Silicon Valley Bank’s Collapse Sends Spanish Banks to Stock Market Plunge

The collapse of Silicon Valley Bank affects bank prices worldwide. Also in Spain. Financials hit markets hard on Friday with sharp declines, making for a difficult day for the selective Spanish stock market, the Ibex 35, which fell more than 4% in early trading hours after confirming a decline. The second bank in the United States, New York Singular Bank.

Six out of 35 shares of the Spanish stock market are held by banks, which is the sector with the largest weight in it. The decline that the Ibex 35 is experiencing this Monday is the strongest since the fall on November 21, when it fell more than 4.9%.

All banks lead the stock market crash in Spain. Sabadell, which came from the bank’s stellar value last year, is now the most penalized with a collapse of up to 10%. Santander gives up almost 8% and CaixaBank, which is owned by the state, gives up more than 7%. The other three Ibex banks, BBVA, Bankinter and Unicaja, are also positioned on this drop.

The panorama painted in Spanish banks is one seen in the rest of Europe. BNP Paribas, the EU’s most important banking group, fell more than 6% in the first hours of the session on Monday. The German giant Deutsche Bank is also leaving more than 7%. Societé Générale, Credit Agricole and other French banks also fell sharply, often exceeding 5%. Dutch ING was one of the worst hit, falling 8.4%.

So far, two banks have been affected by the crisis that spans the US, led by Silicon Valley Bank. The banking group collapsed due to losses incurred by deposit management after interest rate hikes. A second entity has been spun off, New York Signature Bank. Another bank with similar characteristics, First Republic, suffered a more than 60% drop before the US market opened.

Source: El Diario





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