SVB: Bank stocks continue to come under pressure

Is this the beginning of the financial crisis?

Global bank stocks continued to be under pressure on Tuesday due to concerns about the impact of a Silicon Valley bank failure.

Regulators in the UK, US and Asia acted quickly to stem the fallout from the collapse of US banks.

The Bank of Japan has provided further support to maintain stability in financial markets after major stock indices fell by 2.1%.

But investors remain concerned that other banks may face similar problems. Prior to last week's shocking collapse, SVB was a relatively obscure bank and the 16th largest bank in the United States.

However, the decision to invest in assets such as government bonds when interest rates were at record lows meant the SVB faced huge losses as the central bank started raising rates.

There is concern that other banks will be caught in the same way.

Russ Mold, investment director at AJ Bell, said:

“I think SVB was a poorly run bank that took too much risk in one sector and got caught up in rising interest rates, but if it had been properly managed this wouldn't have happened.

But rising interest rates will undoubtedly pose additional challenges for banks, the economy and start-ups."

In Japan, shares of major lenders like MUFG, the country's biggest bank, fell more than 8% on Tuesday. An index of Japanese bank stocks, known as the Topix Banks Index, fell 7.4% despite a Bank of Japan (BoJ) guarantee.

"Japanese financial institutions' direct exposure to Silicon Valley banks is small, so the impact will be limited," a BOJ official said.

European bank index stocks fell 0.75% on Tuesday morning. But this was an improvement from his 6.7% drop on Monday.

In the UK, financial stocks that plunged on Monday continued to fall. Banking group Standard Chartered fell 1.6% and HSBC fell 1.1%.

Stocks of several US regional banks fell on Monday. Shares of San Francisco-based First Republic Bank fell 62%, while shares of Western Alliance Bank of Arizona fell 47%.

HSBC steps in to save UK division of Silicon Valley Bank

Lessons learned from the failed 'tech bank' SVB

The SVB was handed over to US regulators over the weekend after an unexpected sale of some bonds last Wednesday sparked a bank scramble.

By the end of Thursday, bank customers (mostly in the tech sector) had attempted to withdraw $48 billion from him. New York-based Signature Bank, which focuses on the cryptocurrency industry, also filed for bankruptcy over the weekend. Meanwhile, HSBC bailed out his SVB UK business with his £1.

There is now speculation that the Federal Reserve will cut back on rate hikes next week to quell turmoil in the banking sector.

The Federal Reserve (Fed) has raised interest rates to curb the rate of increase in prices known as inflation.

On Tuesday, new figures showed that US annual inflation fell to 6% in February and from 6.4% in January.

The US Federal Reserve (Fed) also raised interest rates by 0.75 points, even though interest rate setters voted for his smaller rate hike of 0.25 points in February.