bankruptcy Silicon Valley Bank (SVB) is due to managers’ lack of foresight due to the decline in the value of the public debt portfolio and the impact of the sharp rise in interest rates as the Federal Reserve struggles with the inflationary spiral in the United States. States shook the markets with the declines in the stock markets on Monday. However, neither the commissioner responsible for the economy, Paolo Gentiloni, nor the main ones Eurozone economy and finance ministersincluding the vice president Nadia KalvinoThey see a “certain risk” for European banks and have sent a message of calm that excludes any possible contamination.
Of course, they agree that an increase in volatility is necessary. excessive “common sense” and, according to the Spanish minister, “to monitor monetary policy on both sides of the Atlantic.” So, both us federal reserve aspect European Central Bank think again upload policy interest rates They started last year to rein in inflationary tensions and are expected to continue this week in Frankfurt. “I would say that this increase in volatility in international financial markets requires more common sense among financial institutions and those responsible for monitoring monetary policy on both sides of the Atlantic,” he said on arrival at the Eurogroup meeting. The fall of the SVB and the “turbulence” it created in the international financial markets leaked into the meeting.
Despite this call for prudence, the first vice president denies that what happened in the United States, where officials acted “quickly and forcefully”, was transferred to Spain thanks to the health of Spanish banks. “Spanish banks find themselves with a strengthened supervisory and regulatory framework and a healthy state of their balance sheets. This is the situation we are in with the perspective of growth and the well-evolved Spanish economy throughout 2023 (…) We will closely monitor the developments and the reaction of the US officials”, but “in the case of the USA there is no concrete exposure to the banks affected at the moment,” said the finance minister, “Germany It doesn’t change anything for him.” christian lindner.
Very similar words have been pronounced by some of your colleagues, such as the French. Bruno Le Maire which excluded “no particular risk of contamination” for France. “On the one hand, because French banks do not have exposure to Silicon Valley banks, and on the other, because French banking business models are so different, with a diversity of risk and a robust supervisory system that protects them. . I repeat, there is no special risk for France,” he insisted on arriving at the meeting, with a message very similar to that of his colleagues from Portugal and Belgium, emphasizing the soundness of European banking rules. “We are monitoring the situation hour by hour” but “for now we have no indication of any risk, of an impact on our Belgian banks,” the finance minister said. vincent van peteghem.
And the commissioner for economic affairs, like the national representatives. “We do not see a particular risk of contamination. Of course, we are assessing the situation in close contact with the European Central Bank” and “we took note of the initiative taken by the US authorities to prevent contamination”, but “European banks, not just the biggest but all European banks” Gentiloni said, “We are applying Basel’s precautionary standards. So there is no direct contamination. The possibility of an indirect impact is something we need to monitor, but at the moment we do not see it as a significant risk,” he said. The European Commission SVB’s presentation is very limited.