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European, Asian bank shares plummet, American banks rise in the premarket

SINGAPORE/LONDON, March 13 (Reuters) – Bank shares in Europe and Asia tumbled on Monday, as the collapse of startup-focused Silicon Valley Bank continued to roil markets, even as U.S. bank shares rose in pre-market trade after authorities moved to stem the contagion. .

The U.S. government stepped in on Sunday with a series of emergency measures to bolster confidence in the banking system following the failure of Silicon Valley Bank (SVB) ( ​​SIVB.O ), which marked the biggest U.S. bank failure since the 2008 financial crisis.

That helped U.S. bank stocks gain in premarket trading. Bank of America ( BAC.N ) was up 3% and JPMorgan ( JPM.N ) up 1.9%, but European and Asian banks remained under pressure.

Europe’s STOXX banking index (.SX7P) fell 2%, after falling 3.78% on Friday. Earlier in the day, Japan’s Topix Bank Index ( .IBNKS.T ) lost 4%, while Singapore’s biggest banks also lost ground, down around 1%. (DBSM.SI), (UOBH.SI), (OCBC.SI)

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HSBC’s London-listed shares were down 1.45% after it said it would buy the UK subsidiary of embattled Silicon Valley Bank for 1 pound ($1.21).

After a dramatic weekend, US regulators said the bank’s customers will have access to all their deposits from Monday and set up a new facility to give banks access to emergency funds.

The Federal Reserve also made it easier for banks to borrow from it in times of emergency.

U.S. banks lost more than $100 billion in market value late last week after the collapse, while European banks lost about another $50 billion in value, according to a Reuters calculation.

“The Fed is not only addressing concerns over the bank’s asset side of the balance sheet, but on the debt side, where they are essentially preempting a major bank run, which…could be devastatingly fast to bring down any institution,” said Chris Weston, head of research at Pepperstone.

“There will likely be further migrations to the stronger banks, and those with a large asset base and low equity will continue to see depositors sell capital.”

SVB’s collapse comes alongside the closure of crypto-focused bank Silvergate ( SI.N ), which last week revealed plans to wind down operations and go into voluntary liquidation, in the wake of FTX’s implosion last year.

U.S. government regulators on Sunday also closed New York-based Signature Bank ( SBNY.O ), which became the next victim of the banking crisis after SVB.

Reporting by Rae Wee in Singapore and Alun John and Amanda Cooper in London, Editing by Sam Holmes and Ed Osmond

Our standards: Thomson Reuters Trust Principles.

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