After the back-to-back collapse of three smaller banks, their biggest US counterparts are seeing a rush of depositors fearful the crisis will spread.
(Bloomberg) — After the back-to-back collapse of three smaller banks, their biggest US counterparts are seeing a rush of depositors fearful the crisis will spread.
JPMorgan Chase & Co., the largest US bank, alone received billions of dollars in recent days, and Bank of America Corp., Citigroup Inc. and Wells Fargo & Co. are also seeing higher-than-usual volume, according to people with knowledge of the matter. Representatives for the firms declined to comment or didn’t respond to messages.
“The top six banks in the US are and have been too big to fail, the financial crisis over 10 years ago demonstrated that,” Michael Imerman, an assistant professor at the University of California Irvine’s business school, said in an interview. “So it’s safer to go with a name with higher degree of certainty.”
Silicon Valley Bank’s seizure Friday, the biggest US bank failure since the financial crisis, was precipitated by fleeing depositors and sent shock waves across the global financial system. Regulators took measures to shore up deposits Sunday, in conjunction with an announcement that Signature Bank failed. Both collapses followed the news last week that Silvergate Capital Corp. would wind down.
Other banks are seeing increased deposit inflows as well. Citizens Financial Group Inc. announced Monday that it “has seen higher than normal interest from prospective new customers over the past few days,” and that it would temporarily extend branch hours to accommodate.
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