US regional banks circle the wagons
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US regional banks circle the wagons

Photo: Getty

The US regional banking system has just sustained its third bank collapse this year. Following an initial sharp slump in reaction to the news, bank stocks have continued to fall as short sellers target perceived weakness. Can the sector stabilize as the impact of rate rises on many of these lenders’ business models becomes apparent?


Many questions must be asked of the US regional banking system.

Can it stabilize following the collapse of Silicon Valley Bank (SVB), Signature Bank and First Republic – not to mention the liquidation of Silvergate? Has the deposit run, which saw $42 billion pulled from SVB in a few hours and $100 billion drain away from First Republic in the first quarter, now stopped or just slowed to a walk?

And to what extent will a new, higher-cost phase in bank funding – with regional and large banks responding to sharply higher deposit betas by boosting deposit rates – weaken bank profitability?


Rob Dwyer head.jpg
Latin America editor
Rob Dwyer is Latin America editor. He has been a financial journalist since 1997 and has worked in London, New York and São Paulo, Brazil, where he is now based.
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