New York (CNN) Despite the looming debt ceiling crisis that has taken center stage in Washington in recent weeks, lawmakers have not forgotten about last Financial crisis this year: Bank failures in March led to turmoil in the regional banking sector.
The US Senate Committee on Banking, Housing, and Urban Affairs holds three hearings this coming week centering on the collapse of Silicon Valley Bank and Signature Bank in March.
The three sessions will be held from Tuesday through Thursday.
- Witnesses on Tuesdays at 10 a.m. ET: Greg Baker, former CEO of Silicon Valley Bank; Scott Shay, Former Chairman and Co-Founder, Signature Bank and Eric Howell, Former President, Signature Bank.
- Witnesses on Wednesdays at 2:30 p.m. ETMark Bialik, Inspector General, Board of Governors of the Federal Reserve System and Bureau of Consumer Financial Protection; Paul Kubik, Senior Fellow, American Enterprise Institute and more.
- Witnesses on Thursdays at 9:30 a.m. ET: Michael Barr Vice President, Oversight, Federal Reserve Board of Governors. Martin Gruenberg, Chairman, Board of Directors of the Federal Deposit Insurance Corporation; Adrian Harris, Superintendent, New York State Department of Financial Services and more.
Federal regulators were first called in to answer questions about the bank’s collapse from the Senate Banking Committee and the House Financial Services Committee in March.
Since then, the Federal Reserve and the Federal Deposit Insurance Corporation have released reports detailing management errors at SVB and Signature Bank, as well as errors by federal regulators in properly handling red flags that preceded the banks’ deaths.
The Fed recommended a comprehensive reassessment of its regulatory and supervisory functions in its report, and Barr called on the central bank to strengthen those operations.
calls for Stronger regulation of the banking sector was accelerated this month after the collapse of First Republic Bank, which was taken into FDIC custody and sold to JPMorgan Chase on May 1. To address “regulatory shortcomings” in banking security.
Warren also called on former First Republic CEO Michael Roffler to respond to the regional lender’s failure and “gross mismanagement.”
Economic and banking sector leaders, including Federal Reserve Chairman Jerome Powell and JPMorgan CEO Jamie Dimon, recently assured the public that the banking sector is stable.
However, investors are concerned that there is another shoe to give away, and this has jittered the market. The SPDR S&P Regional Banking exchange traded fund, which tracks a group of mid-cap banks, is down more than 38% for the year. Backwest Bank fell about 79.5%, Western Alliance fell 54.8% and KCorp 47.8%.
American consumers are concerned about the economy
US consumers are concerned about the uncertainty surrounding the economy and the default on US government debt.
This is according to a preliminary report from the University of Michigan on Friday. The survey shows the university’s index of consumer confidence fell 9% this month, with declines erasing more than half of its gains since rebounding from a record low in June 2022.
A separate report from the Federal Reserve Bank of New York on Friday shows that US households are becoming increasingly frugal. Monthly household spending growth fell to 5.4% from a revised 7.1% in December, according to the New York federal household spending survey, which is sent out every four months.
Meanwhile, projected monthly spending growth fell to 3.4% in April, hovering around levels not seen since December 2020.
There are many dreaded headwinds Confronting the economy and consumers, including tightening credit standards, the looming debt ceiling crisis and the possibility of a recession later this year. These factors affected consumers’ confidence in the economy and their financial portfolios.
The Conference Board poll indicated that consumer confidence worsened last month due to growing concerns about the labor market: The group’s consumer confidence index, which measures attitudes toward the economy and the labor market, fell to its lowest level since last July.
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the next
Monday: 2023 Federal Reserve Financial Markets Conference in Atlanta.
Tuesday: 2023 Atlanta Federal Reserve Financial Markets Conference (continued), April Retail Sales and Homebuilders Confidence Index. Earnings report from Home Depot.
Wednesday: New home starts in April and building permits. Earnings reports from Target (TGT) and TJ Maxx (TJX).
Thursday: Weekly unemployment claims, April existing home sales and mortgage rates. Earnings report from Wal-Mart (WMT).
Friday: FHFA Evaluation Subcommittee Meeting.
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