Saturday, April 26, 2025

Downfall of SVB, Credit Suisse undermined confidence: JP Morgan CEO

Date:

Share post:

London, April 5: The financial turmoil that led to the downfall of Silicon Valley Bank (SVB) in the US and Credit Suisse in Europe is not yet over and its effects will be felt for years, warns JP Morgan CEO Jamie Dimon.

In an annual letter to JP Morgan’s shareholders, Dimon said last month’s failure of SVB and the Swiss government-brokered takeover of Credit Suisse by its rival UBS had undermined confidence in the banking system, the Guardian reported.”As I write this letter, the current crisis is not yet over, and even when it is behind us, there will be repercussions from it for years to come,” he said.

Although suggesting that there were marked differences with the 2008 financial crisis, Dimon, who has been the chair and chief executive of JP Morgan since 2006, suggested that the risks to the market had been “hiding in plain sight”, in a swipe at regulators.

These risks included exposure to interest rates being raised sharply around the world to tackle soaring inflation.

Dimon criticised the US Federal Reserve for failing to incorporate higher borrowing costs into its annual stress tests.

The turmoil in the banking sector had led investors to price in a greater risk of a US recession, he said, warning that banks were now more likely to show caution when approving new lending for businesses and households, with consequences for an economy already struggling with rate increases, the Guardian reported.

“It is not clear when this current crisis will end,” Dimon said. “It has provoked lots of jitters in the market and will clearly cause some tightening of financial conditions as banks and other lenders become more conservative.”

Axel Lehmann, the Credit Suisse chair, told investors at the 167-year-old bank’s last-ever annual shareholder meeting in Zurich on Tuesday that he was “truly sorry” the bank had failed to stem the crisis.

“I apologise that we were no longer able to stem the loss of trust that had accumulated over the years and for disappointing you,” he said.

IANS

Related articles

CARS24 lays off nearly 200 employees in restructuring exercise

New Delhi, April 26: Autotech platform CARS24 has laid off nearly 200 employees across various functions, as part...

Pak Army official sparks outrage with throat slit gesture at London protest against J&K terror strike

London, April 26: In a deeply controversial moment, a senior official from the Pakistan Army inflamed tensions by...

Gold smuggling case: Karnataka HC dismisses actress Ranya Rao’s bail plea

Bengaluru, April 26: The Karnataka High Court on Saturday dismissed the bail plea of actress Ranya Rao in...

Kailash Mansarovar Yatra to take place between June-August: MEA

New Delhi, April 26: The much-awaited ​Kailash Mansarovar Yatra will take place between June to August, this year,...