US Secretary of the Treasury Janet Yellen on Monday said deposit outflows from small and medium-sized banks were diminishing, but she was watching the situation closely and was “not willing to allow contagious runs to develop” in the US banking system.
Yellen told reporters after an event at Yale University that confidence in the banking system was strengthened by actions taken by the Treasury, the US Federal Reserve and the US Federal Deposit Insurance Corp (FDIC) after the failures of Silicon Valley Bank and Signature Bank.
“My read is that outflows from smaller and medium-sized banks are diminishing, and matters are stabilizing, but it’s a situation we’re watching very closely,” Yellen said.
Photo: Reuters
CLIMATE FOCUS
Asked whether the Financial Stability Oversight Council, the multi-regulator body charged with curbing systemic risks, had spent too much time on assessing risks of climate change and missed problems that led to the failures of Silicon Valley and Signature, Yellen disagreed, saying the body studies all potential financial risks.
“We’ve focused on a range of issues including financial, risks and have not put all of our focus on climate risks,” she said, adding that the body had also identified interest-rate mismatches as a potential risk.
“I don’t think there’s a fundamental problem with the banking system,” she added.
Meanwhile, the FDIC on Monday announced that the marketing process for the about US$60 billion loan portfolio retained in receivership following the failure of Signature Bank.
The FDIC expects to begin its marketing of the retained loan portfolio of the former Signature Bank later this summer, it said in a statement.
The portfolio is comprised primarily of commercial real-estate loans, commercial loans and a smaller pool of single-family residential loans.
Last week, Reuters reported that the FDIC has retained advisers to sell the securities portfolios that the new owners of failed Silicon Valley Bank and Signature Bank rejected.
The FDIC on Monday said that it has retained Newmark & Co Real Estate Inc as an adviser on the sale.
On March 19, a unit of New York Community Bancorp agreed with US regulators to buy deposits and loans from Signature Bank.
CHIP WAR: Tariffs on Taiwanese chips would prompt companies to move their factories, but not necessarily to the US, unleashing a ‘global cross-sector tariff war’ US President Donald Trump would “shoot himself in the foot” if he follows through on his recent pledge to impose higher tariffs on Taiwanese and other foreign semiconductors entering the US, analysts said. Trump’s plans to raise tariffs on chips manufactured in Taiwan to as high as 100 percent would backfire, macroeconomist Henry Wu (吳嘉隆) said. He would “shoot himself in the foot,” Wu said on Saturday, as such economic measures would lead Taiwanese chip suppliers to pass on additional costs to their US clients and consumers, and ultimately cause another wave of inflation. Trump has claimed that Taiwan took up to
SUPPORT: The government said it would help firms deal with supply disruptions, after Trump signed orders imposing tariffs of 25 percent on imports from Canada and Mexico The government pledged to help companies with operations in Mexico, such as iPhone assembler Hon Hai Precision Industry Co (鴻海精密), also known as Foxconn Technology Group (富士康科技集團), shift production lines and investment if needed to deal with higher US tariffs. The Ministry of Economic Affairs yesterday announced measures to help local firms cope with the US tariff increases on Canada, Mexico, China and other potential areas. The ministry said that it would establish an investment and trade service center in the US to help Taiwanese firms assess the investment environment in different US states, plan supply chain relocation strategies and
WASHINGTON POLICY: Tariffs of 10 percent or more and other new costs are tipped to hit shipments of small parcels, cutting export growth by 1.3 percentage points The decision by US President Donald Trump to ban Chinese companies from using a US tariff loophole would hit tens of billions of dollars of trade and reduce China’s economic growth this year, according to new estimates by economists at Nomura Holdings Inc. According to Nomura’s estimates, last year companies such as Shein (希音) and PDD Holdings Inc’s (拼多多控股) Temu shipped US$46 billion of small parcels to the US to take advantage of the rule that allows items with a declared value under US$800 to enter the US tariff-free. Tariffs of 10 percent or more and other new costs would slash such
Hon Hai Precision Industry Co (鴻海精密) is reportedly making another pass at Nissan Motor Co, as the Japanese automaker's tie-up with Honda Motor Co falls apart. Nissan shares rose as much as 6 percent after Taiwan’s Central News Agency reported that Hon Hai chairman Young Liu (劉揚偉) instructed former Nissan executive Jun Seki to connect with French carmaker Renault SA, which holds about 36 percent of Nissan’s stock. Hon Hai, the Taiwanese iPhone-maker also known as Foxconn Technology Group (富士康科技集團), was exploring an investment or buyout of Nissan last year, but backed off in December after the Japanese carmaker penned a deal
RSS