Global financial crash fears after ‘bloodbath’ of Deutsche Bank shares | City & Business | Finance

Earlier this month, fears regarding the banking sector started in the US when SVB collapsed.

The bank is known predominantly for services in the technology industry and had benefitted from low-interest rates.

But, SVB suddenly entered a crisis when customers withdrew their deposits.

The bank has also invested in government bonds, but the value of these dropped when interest rates rose.

SVB then announced it would sell $2.25billion (£1.8billion) in new shares to plug the hole in its finances, provoking many customers to withdraw their cash. The bank’s stocks then plummeted.

Credit Suisse has come under scrutiny for years, with many casting doubt over how profitable the bank is.

The Saudi National Bank, a major backer of the Swiss bank, subsequently withdrew its funding. Then, other banks did the same.

Credit Suisse was saved by its rival UBS for $3.15billion (£2.6billion).

Source link

Check Also

Cost of living payment: Full list of DWP benefits not eligible for upcoming £300 boost | Personal Finance | Finance

Millions of Britons on certain mean-tested benefits are to receive a £300 cost of living …