March 14, 2023 11:20 GMT
MNI BRIEF: Eurozone Banks Likely Safe, SVB Risk Remains- Scope
Basel framework should prevent systemic banking collapse, but irrational actors may multiply risks, ratings agency says
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European banking’s robust regulatory and supervisory framework, solid capital and liquidity buffers mean a repeat of the US-based SVB crisis is unlikely, with investor confidence in banks likely to remain high and systemic risks contained, rating agency Scope said on Tuesday.However, “irrational behaviour, herd mentality and the actions of aggressive short sellers mean damaging impacts cannot be excluded for targeted institutions,” they added, with the likely failure of more US banks expected to reverberate for some time.