Latest on the banking crisis and global markets

Rep. Patrick McHenry, chairman of the House Financial Services Committee, said the contributions from a fundraiser that Signature Bank threw him prior to the bank’s collapse weren’t processed and have been returned.

“So when people contribute to me, it’s an endorsement of my agenda – not the other way around,” McHenry said, when pressed by?CNN on whether he should recuse himself?from any investigations into the bank failures. “In this circumstance, we had not processed the contributions and we returned them all.”

The fundraiser was?first reported by Bloomberg.

McCarthy later defended his chairman, saying McHenry “doesn’t raise money because these people are influencing him” and pointed out that “there’s a limited amount that someone can provide in this process” anyway.

During a pen-and-pad with reporters at the House GOP policy retreat, McHenry and other top Republicans talked about the need to bring in bank executives to answer questions about the recent bank failures and dismissed the idea that loosening the Dodd-Frank law in 2018 had anything to do with their collapse.

Republicans demurred on whether a legislative response, such as insuring deposits beyond $250,000, is necessary, saying they need to get more information first.

“I want the investigation, the data, to lead to our conclusion for sound public policy,” McHenry said. “That’s my role as committee chair.”

The stabilization of bank outflows has continued into Monday, a US official told reporters during a conference call.

Regulators are closely watching bank deposits as they try to revive confidence in the banking system.

The US official said volatility in the share prices of regional banks has been in no way correlated to deposit outflows.

Uninsured deposit outflows have slowed, stopped or in some cases reversed among all institutions in focus right now, the US official said.

The US official said the administration is staying vigilant but feeling very good about where things stand at the moment in terms of the level of financial resources at these institutions.

The New York Stock Exchange building in The Financial District of Manhattan on March 15.

Stocks closed higher on Monday as investors grew more optimistic about global regulators’ ability to contain the banking crisis.

The rally comes after UBS agreed to buy troubled Swiss lender Credit Suisse for $3.25 billion on Sunday. The bank’s move is the latest in a string of interventions from global governments and industry players who have stepped in to help stymie the tumult in the financial sector.

Shares of UBS rose?about 3.3%?in an intraday reversal. Shares of New York Community Bancorp soared by over 31%, lifted by its purchase of virtually all of Signature Bank’s deposits and $38.4 billion worth of the failed bank’s assets.

Still, regional banks aren’t out of the woods just yet. Shares of First Republic fell?to an intraday record low before ending the session down about 47%?in another day of steep losses for the company.

Recession fears also continued to dog investors ahead of the Federal Reserve’s meeting set to conclude Wednesday. Traders see about a 73%?probability of the central bank raising interest rates by a quarter point.

West Texas Intermediate settled at about $67 a barrel.

The VIX, known as Wall Street’s fear gauge, rose to?about 24.

The Dow rose about 382 points, or?1.2%.

The S&P 500 gained about 0.9%.

The Nasdaq Composite climbed about 0.4%

A person walks in front of a logo of the Swiss bank?UBS?in Zurich, Switzerland March 20.

S&P Global on Monday revised down its outlook on UBS after the bank agreed to rescue Swiss rival Credit Suisse in a $3.25 billion deal.

The credit ratings agency changed its outlook to negative from stable, citing “material execution risk” concerns with UBS’s acquisition of Credit Suisse.

“In our base case, we already anticipate client churn at the combined entity, particularly in wealth management and Swiss banking, where both entities have significant client overlaps,” S&P Global said in a note.

S&P Global maintained its issuer credit ratings for UBS.

U.S. Senator Tim Scott (left) and Representative Patrick McHenry (right).

The top Senate Republican and top House Republican with jurisdiction to oversee the Federal Reserve have requested information from the central bank and the Federal Deposit Insurance Corporation regarding the failed Silicon Valley and Signature banks.

Sen. Tim Scott, the top Republican on the Senate Banking Committee, and Rep. Patrick McHenry, chairman of the House Financial Services Committee, requested in a letter a timeline of “the Federal Reserve’s lending, supervisory, and examination activity for the last two years with regards to SVB/and or Signature Bank,” and the names and titles of all people from the Fed involved in the process.?

In a letter to the FDIC, they similarly requested, “events related to the FDIC’s supervisory or resolution related activity for the last two years with regards to SVB and/or Signature Bank,” and the names and titles of those involved at the FDIC.?

The deadline for the documents is March 31.

Last week the House Financial Services Committee announced it would hold a hearing with financial regulators over the failure of SVB and Signature Bank.?

Deutsche Bank headquarters on August 13, 2021 in Frankfurt am Main, western Germany.

One of Europe’s leading banks moved quickly Monday to reassure investors it isn’t holding significant quantities of a particularly risky type of bonds issued by Credit Suisse.

“Our exposure to Credit Suisse’s AT1s is near zero,” Deutsche Bank said in a statement.

Deutsche Bank had its own share of troubles in the middle of the past decade, but Germany’s biggest bank has rebounded strongly, and last month reported its highest pre-tax profit in 15 years.

Shares in the bank were down 3% on Monday, broadly in line with the wider European banking sector.

Christine Lagarde, president of the European Central Bank, said in a speech Monday afternoon that banks in the euro area had a “very limited exposure” to Credit Suisse, particularly in relation to AT1 bonds.

“We’re not talking billions, we’re talking millions,” she said.

Analysts said the surprise move to wipe out Credit Suisse’s AT1 bondholders had unsettled investors, particularly as shareholders – typically the last in line for a payout when a bank fails – would be receiving something.

EU banking regulators, while welcoming the “comprehensive set of actions” taken Sunday by Swiss authorities, said Monday they would act differently if ever the need arises.

“In particular, common equity instruments are the first ones to absorb losses, and only after their full use would Additional Tier One be required to be written down,” the Single Resolution Board (SRB), the European Banking Authority and the European Central Bank said in a joint statement. “This approach has been consistently applied in past cases and will continue to guide the actions of the SRB and ECB banking supervision in crisis interventions.”

Some background: AT1s belong to a type of bank capital known as “contingent convertibles.” They are popular with institutional investors because they often offer a higher yield than other bank debt and corporate bonds with a similar rating. However, their “convertible” nature means they can be written down completely, or swapped for equity if a bank gets into distress.

Traders work on the floor of the New York Stock Exchange?on Monday, March 20.

Stocks teetered Monday as investors juggled the uncertainty surrounding the banking crisis and the Federal Reserve’s?upcoming meeting this week.

The Dow rose roughly 1% by the end of the morning trading session. The S&P 500 gained about 0.6%. The Nasdaq Composite fell about 0.03%.

Recession fears continued to loom over Wall Street, and investors accordingly sought refuge in safety stocks. Gold continued its rise to roughly $1,972 a troy ounce.

Bitcoin eased back from earlier levels but remained up at $27,960 per coin, in another sign that investors are seeking steady places to stash their cash.

“There’s still a tremendous amount of risk around the Fed policy meeting on Wednesday,” said Edward Moya, senior market analyst at OANDA.

CNN’s Fear and Greed Index was at 29, indicating fear on Wall Street. That’s up from last week, when the index suggested extreme fear was permeating markets.

Still, investors were heartened by global regulators’ steps to contain the tumult in banking. UBS on Sunday agreed to buy rival Swiss bank Credit Suisse in a move to both rescue the embattled lender and help instill faith in the global financial sector.

An exterior view of the First Republic Bank headquarters on March 13 in San Francisco, California.

First Republic’s stock continued to tumble on Monday and the San Francisco-based bank’s shares were halted multiple times for volatility, having fallen 46% by midday.

Despite having received a $70 billion loan from JPMorgan Chase a week ago and another?$30 billion lifeline?from a consortium of banks on Thursday, investors weren’t optimistic about the bank’s prospects.

Thursday’s government-arranged deal amounted to a big cash deposit that would allow First Republic to meet customers’ demands for withdrawals. That may have helped alleviate the bank run for the time being, said Patricia McCoy, a law professor at Boston College.?“But it doesn’t solve this profitability problem,” she said in an interview Friday.

Banks, led again by JPMorgan, are trying to work on yet another rescue plan for First Republic on Monday, the Wall Street Journal reported.

People walk near Swiss bank?Credit?Suisse?in Zurich, Switzerland, on March 20.

The UBS rescue of Credit Suisse is an encouraging development that should help boost diminished confidence in the global banking system, according to Moody’s Analytics chief economist Mark Zandi.

Zandi described the UBS-Credit Suisse deal – one that was pushed by Swiss regulators – as a “big plus.”

“Governments are judiciously resolving the weak links in the global financial system by either shutting them down (SVB and Signature), merging them with strong institutions (Credit Suisse) or organizing support for struggling institutions (First Republic),” Zandi told CNN in an email on Sunday.

Those steps – combined with the FDIC guaranteeing all deposits at failed institutions and the Fed launching a new bank lending program – “should restore confidence in the soundness of the financial system,” Zandi said.

The FDIC also announced an agreement Sunday night to sell most of failed Signature Bank to Flagstar Bank owner New York Community Bank.

“There should be no doubt that depositors will get their deposits when they want them,” Zandi said.?

The trading floor at the?New?York?Stock?Exchange on March 17.

The US banking sector is in good shape despite the global banking crisis, the co-president of Alliance Partners and a former financial economist for the Securities and Exchange Commission says.

“The US is fundamentally in good shape. I think we have really strong community banks, regional banks, you know, the country’s largest banks have certainly been stepping up to do what they can to stabilize the system, Lori Bettinger told CNN Chief Correspondent Christine Romans on Monday. “

A cautiously optimistic Bettinger says the next week will be crucial as bank jitters grip consumers and investors on Wall Street.

Bettinger also says most consumers shouldn’t be concerned about the banking industry’s health, reaffirming the United States Treasury secretary’s message that their money is safe.

An employee holds the door open at the?Silicon?Valley?Bank?branch office in downtown San Francisco, California, on March 13.

In a potentially good sign for the on-edge banking industry, the FDIC says there’s “substantial interest” in the remnants of Silicon Valley Bank — so the agency is extending the bidding process to give interested parties more time.?

“The FDIC and the bidders need more time to explore all options in order to maximize value and achieve an optimal outcome,” it said in a statement Monday.?

Just over a week ago, the FDIC took over Silicon Valley Bank and Signature Bank after both suffered a sudden run on deposits. Already, the FDIC has managed to offload much of what remains of Signature’s business to Flagstar Bank, a subsidiary of New York Community Bank.

While Flagstar appeared reluctant to take on all of Signature’s assets — about $60 billion of which will stay in FDIC receivership — the agreement suggests there’s still appetite for deals, even despite banks’ badly shaken confidence over the past 10 days.?

UBS London headquarters on March 20.

The European-listed shares in Switzerland’s biggest bank, UBS, rose 4.5% Monday afternoon — rebounding from earlier losses following its takeover of rival Credit Suisse.

Earlier in the session UBS’s stock had been down as much as 15% in early trade, along with a broader fall in the European banking sector.

Europe’s benchmark Stoxx Europe 600 Banks index — which tracks 42 big EU and UK?banks — fell 6% Monday morning before notching a modest rise of 0.8% by mid-afternoon.

Markets shuddered Monday despite Sunday’s announcement by Swiss authorities that UBS would buy ailing lender Credit Suisse for 3 billion Swiss francs ($3.25 billion).The deal, designed to help stem market panic, also came with conditions that wiped out $17 billion worth of Credit Suisse’s bonds, a move that rattled investors in Europe’s credit market.

This month’s banking meltdown was catalyzed in part by plunges in tech profits and cryptocurrency values. But in a strange twist, those two sectors also stand to gain the most from it.?

The tech sector suffered a disappointing 2022: The tech-heavy Nasdaq ended the year down nearly 30% as inflation soared, the Federal Reserve raised interest rates and the pandemic-era tech services boom dried up.?Cryptocurrencies didn’t fare well, either, with bitcoin losing about 60% of its value in 2022.??

So why are those two factors at least partially responsible for the current banking chaos?Because Silicon Valley Bank and Signature Bank had a highly concentrated customer base in those sectors.

And as interest rates continued to chip away at crypto profits and undercut the value of tech stocks, it became tough for the industry to raise funds. So companies began to draw down their deposits at the already-beleaguered banks, causing a liquidity crisis and their subsequent collapses.?

Yet, ironically, the banking mess is now helping tech companies and cryptocurrencies as investors flock out of the banking system in search of alternative safe spaces to store their cash.?

Bitcoin jumped to a 9-month high this past weekend as investors sought out alternative assets. The digital currency gained around 3% over the last 24-hours alone and is now trading at nearly $28,000 per coin – significantly higher than its November low of $15,480.?

The Nasdaq, meanwhile, is up nearly 11% so far this year.?

Generalist investors that were “hiding out in financial stocks and the overall banking sector are now seeing a much more white knuckle environment not knowing what news will come out on a Sunday night and which bank is under distress,” wrote Wedbush analysts in a note Monday.?

There are more positive signs for Big Tech ahead, wrote the analysts. Companies have been rigorously enacting cost-cutting measures, their fundamentals are stabilizing, and the Fed could be nearing the end of its aggressive hiking regimen.?

“While it sounds like Twilight Zone comment to many investors; tech stocks have become the new safety trade with Big Tech leading the way,” they wrote.

UBS headquarters' entrance in Zurich, Switzerland, on March 20.

US stocks rose Monday as investors digested UBS’s takeover of embattled Swiss lender Credit Suisse.

UBS on Sunday agreed to buy Credit Suisse for 3 billion Swiss francs ($3.25 billion), which is about 60% less than what the bank was worth at Friday’s market close. Shares of Credit Suisse tumbled 56%.

Shares of New York Community Bancorp, which said Monday it would buy $38.4 billion worth of assets and virtually all deposits from failed Signature Bank, climbed over 33%, after seeing its biggest jump on record earlier in the day.

Gold continued its rise Monday as investors sought safer assets, having earlier hit its highest level in almost a year. Bitcoin jumped to a 9-month high.

West Texas Intermediate, the US benchmark for oil, sank to $65 a barrel, its lowest level since 2021, amid ongoing concern about banking sector contagion.

Regional banks continue to be under pressure over a week after the collapse of Silicon Valley and Signature banks rocked the financial sector, sending customers fleeing and banks rushing to restore faith in the security of their deposits.?

Compounding the market’s volatility is a Federal Reserve policymaking meeting. Traders see a roughly 70% probability that the central bank will raise interest rates by a quarter point.

The Dow rose about 207 points, or 0.65%.

The S&P 500 gained about 0.2%.

The Nasdaq Composite fell about 0.3%.

The European Central Bank is pictured behind EU flags in Frankfurt am Main, western Germany, on March 16.

Banks showed limited appetite Monday for the emergency supply of US dollars offered by major central banks to keep credit flowing to households and businesses. That could be a sign that banks aren’t quite as stressed as we believed.

One lender borrowed $5 million via the European Central Bank, ECB data showed, while there were no takers in the United Kingdom, according to the Bank of England figures.

On Sunday, the Federal Reserve, the ECB, the Bank of England and the central banks of Canada, Japan and Switzerland announced “a coordinated action to enhance the provision of liquidity via the standing US dollar liquidity swap line arrangements.

”Swap lines are agreements between two central banks to exchange currencies. The swap line between the Fed and the ECB, for example, enables the ECB to receive US dollars in exchange for an equivalent amount of euros. The ECB can then distribute those dollars to commercial banks in the 20 countries that use the euro.

Such agreements can be an important tool for preserving financial stability and preventing market tension from affecting the economy.

A group of Swiss investors is considering legal action over the emergency takeover of Credit Suisse by UBS that was announced Sunday.

Ethos Foundation said the Swiss pension funds it represents are “doubly penalized” by the takeover because they won’t get to vote on the deal and they’ll be faced in the future with the downsides of dealing with one dominant national bank.

In a statement Monday, Ethos urged UBS to consider spinning out the Swiss bank and listing it separately via an IPO as soon as possible.

“This would preserve jobs and maintain a healthy competition, which would ensure the proper functioning of our economy,” Ethos said. “Faced with this unprecedented failure in the history of the Swiss financial centre, Ethos will continue to defend the interests of minority shareholders, starting with the Swiss pension funds. All options will be examined in the coming days, including legal ones, to determine the responsibilities of this debacle.”

The Marriner S. Eccles Federal Reserve Board Building is seen on September 19, 2022 in Washington, DC.

Many other banks, the identities of which will likely remain unknown for quite some time, sought emergency loans from the Federal Reserve over the past week. Banks borrowed a record $153 billion from the Fed’s discount window last week – a last-resort option for banks to gain quick access to cash.?

The good news: Those loans do not indicate anything inherently wrong with the global banking system. None of the banks that borrowed from the Fed’s discount window borrowed on secondary credit terms – emergency, overnight loans that help deeply troubled banks keep the lights on. Those loans come with severe restrictions and more oversight from the Fed.

The fact that the loans the Fed delivered were primary credit “indicates that US bank supervisors consider the banks that needed emergency support ‘healthy’ and not at elevated risk of imminent failure,” noted Jill Cetina, Moody’s analyst, in a note to investors Friday.

The bad news: Banks may be healthy on the whole, but all that borrowing shows just how much strain is on the financial system at the moment.

Strain means banks may be resistant to lend money, adding more scrutiny to the creditworthiness of borrowers. That means fewer mortgages and less money flowing to businesses, which could slow the global economy.

That’s why central banks stepped in on Sunday. Their coordinated action, the likes of which the world hasn’t seen since the European debt crisis a decade ago, represents the first indication that the banking crisis could have long-lasting and damaging effects to the global economy.

A man takes a picture with his mobile phone of a market board at the headquarters of Swiss giant banking UBS in Zurich on March 20.

Credit Suisse, hobbled for decades by mismanagement, scandal and bad bets, finally succumbed to the emerging global banking crisis. Its stunning and?rapid takeover by rival UBS, orchestrated by Swiss authorities Sunday, took one giant, wobbling domino off the table. Hours later, a group of central banks from around the world boosted the movement of US dollars through the global financial system to keep loans flowing to households and businesses and support the world’s major economies.

The question investors and nervous customers want answered this week: What’s next? Are other banks about to fall – or be saved? Will regulators be forced to step in with more rescue plans?

Some regional banks have teetered on the brink over the past week, with anxious customers pulling tens of billions of dollars in cash from the smaller banks and placing them with bigger institutions that are better capitalized.

To pay customers their withdrawals, regional banks have scrambled to access enough cash. First Republic received a $70 billion loan from JPMorgan Chase a week ago and another $30 billion lifeline on Thursday. That still appears to be insufficient, with First Republic’s shares tumbling another 33% Friday.

Many other banks, the identities of which will likely remain unknown for quite some time, sought emergency loans from the Federal Reserve over the past week. Banks borrowed a record $153 billion from the Fed’s discount window last week – a last-resort option for banks to gain quick access to cash.?

A sign reads “FDIC Insured” on the door of a branch of First Republic Bank in Boston, Massachusetts, on March 13.

The solution to the banking crisis sweeping the globe would be for customers to stop withdrawing deposits. But the banking system and regulators would have to calm fears before that happens system-wide.

That’s why there are growing calls for US authorities to guarantee all customer deposits, regardless of whether they’re insured or uninsured. The US Federal Deposit Insurance Corporation insures deposits at eligible banks up to $250,000 per account. European countries operate similar programs.?

If regulators insured all deposits of all sizes, similar to what happened to Silicon Valley Bank and Signature customers after those banks failed, that could give customers confidence that their money is safe with regional banks.

Moody’s on Friday said there is a “high likelihood” that federal regulators could invoke a systemic risk exception to protect all uninsured depositors at First Republic. But if regulators make an exception for just one more bank, that would mean rescuing every teetering bank.

US authorities may be reluctant to do that if there’s a chance the system can work out its problems on its own. With a looming debt ceiling crisis and intense scrutiny about using taxpayer money to fund anything close to resembling a bailout, the Biden administration would almost certainly prefer an organic solution to the crisis.

There’s some evidence that may be starting to happen.

Western Alliance and Charles Schwab, which both reported a large amount of withdrawals last week, sought to reassure customers and investors by saying deposits were relatively steady over the past few days and they remained sufficiently liquid – which means they have enough cash to continue to fund their operations.

And a US official told CNN that deposits at small and midsize American banks have stabilized in recent days, with outflows either slowing, stopping or in some cases reversing.?

Credit Suisse’s problems – years in the making – are unrelated to the recent deposit runs at US banks. But after UBS came to the rescue of Credit Suisse, the flood of deposit withdrawals from US regional banks eased and central banks tried to make dollars more available to keep banks lending, there’s hope the current banking crisis fades and the world evades an economic downturn.

What’s certain: This isn’t over yet.

– CNN’s Matt Egan and Phil Mattingly contributed to this report

Stressed banks will pay much greater attention to the creditworthiness of borrowers, whether they’re businesses looking for loans or home buyers trying to find mortgages.

Christine Lagarde, president of the?European Central Bank, told reporters Thursday that “persistently elevated market tensions” could further constrict credit conditions that were already tightening in response to rising interest rates.

CNN’s Anna Cooban contributed to this report.

The Marriner S. Eccles Federal Reserve building is pictured in Washington, DC, on March 13.

Lenders of last resort — central banks — and some of the industry’s strongest players provided huge sums of emergency cash to support teetering banks since the global banking crisis began.

More than $400 billion has gone so far in direct central bank support.

In guaranteeing all deposits at Silicon Valley Bank and Signature Bank, the US Federal Reserve is on the hook for $140 billion.

Then there’s the $54 billion the Swiss National Bank offered Credit Suisse in the form of an emergency loan, and 209 billion Swiss francs ($225 billion) offered to UBS in loans, guaranteed by the Swiss states, and protection against potential losses.

The Fed has also agreed to record amounts of loans to other banks this week. Banks borrowed nearly $153 billion from the Fed in recent days, smashing the previous record of $112 billion set during the crisis of 2008.

Banks also drew on nearly?$12 billion of loans?from the Fed’s new emergency lending program established at the start of the week with the aim of preventing more banks from collapsing.

The $318 billion the Fed has loaned in total to the financial system is about half what was extended during the global financial crisis.

The banking industry has also coughed up billions. JPMorgan Chase, Bank of America and Citigroup are among a group of 11 lenders providing the $30 billion cash infusion aimed at shoring up confidence in First Republic Bank.

HSBC has reportedly committed more than $2 billion to SVB’s UK business, which it bought on Sunday for ￡1.

CNN’s Anna Cooban contributed to the reporting.

This story has been updated to reflect the latest numbers.

Customers line up outside a Silicon Valley Bank location in Wellesley, Massachusetts, on March 13.

On March 10, the failure of Silicon Valley Bank — biggest since the global financial crisis — was playing out in real time as a major lender to the tech industry succumbed to a?classic bank run.

A week on, Signature Bank has been shut down, First Republic Bank has been propped up, and the first major threat since 2008 to a bank of global financial significance — Credit Suisse — has been averted after it was?taken over by UBS.

Here’s a timeline of what happened:

Friday, March 10: The US government’s Federal Deposit Insurance Corporation (FDIC) took control of SVB. It was the biggest banking collapse in America since Washington Mutual in 2008. The wheels started to come off 48 hours earlier when the bank took a multibillion-dollar?loss cashing out US government bonds to raise money to pay depositors. It tried — unsuccessfully — to sell shares to shore up its finances. That triggered the panic that led to its downfall.

Sunday, March 12: The FDIC shut down Signature Bank after a run on its deposits by customers who were?spooked by the implosion of SVB. Both banks had an unusually high ratio of?uninsured deposits to fund their businesses.

Wednesday, March 15: After watching shares in Credit Suisse?collapse by as much as 30%, Swiss authorities announced a backstop for the country’s second-biggest bank. It calmed the immediate market panic but the global player is not out of the woods yet. Investors and customers are worried that it doesn’t have a credible plan to reverse a long-term decline in its business.

Thursday, March 16: First Republic Bank was teetering on the brink as customers withdrew their deposits. In a meeting in Washington, US Treasury Secretary Janet Yellen and Jamie Dimon, the CEO of America’s biggest bank, drew up plans for a private sector rescue. The result was an agreement with a group of American lenders to deposit tens of billions of dollars of?cash into First Republic to staunch the bleeding.

Sunday, March 19: Switzerland’s biggest bank, UBS, agreed to buy its?ailing rival Credit Suisse?in an emergency rescue deal aimed at stemming financial market panic.

A branch of Signature Bank is pictured in New York, on March 13.

A week after Signature Bank failed, the Federal Deposit Insurance Corporation said it has sold most of its deposits to Flagstar Bank — a subsidiary of New York Community Bank.

New York Community Bank bought substantially all of Signature’s deposits and a total of $38.4 billion worth of the company’s assets. That includes $12.9 billion of Signature’s loans, which New York Community Bank purchased at a steep discount — it paid just $2.7 billion for them. New York Community Bank also paid the FDIC stock that could be worth up to $300 million.

At the end of last year, Signature had more than $110 billion worth of assets, including $88.6 billion of deposits, showing how the run against the bank two weeks ago led to a massive decline in deposits.

Not included in the transaction is about $60 billion in other assets, which will remain in the FDIC’s receivership. It also doesn’t include $4 billion in deposits from Signature’s digital bank business.

As the banking crisis spreads, banks have grown increasingly wary of taking on risk. That’s likely why New York Community Bank was unwilling to take on all of Signature’s assets.

The FDIC said Sunday it expects to sell off those assets over time, and the total cost to the government will ultimately be about $2.5 billion.

Global oil prices fell more than 2% early Monday, with US crude trading around $65 a barrel and international benchmark Brent crude around $71, as a selloff in global banking stocks resumed despite dramatic weekend action to shore up confidence.

Stress in the banking industry could slow economic growth, reducing demand for energy, as lenders become warier about extending credit to businesses and households.

Goldman Sachs believes that the American economy has a 35% chance of entering a recession within a year — up from 25% before the banking sector meltdown started.

Meanwhile, gold prices jumped 1.7% to trade at $2,004 per ounce — the highest price since March 8, 2022.

Gold often benefits from increased demand during times of economic uncertainty. It also becomes more attractive to investors when interest rates are low.

The market turmoil unleashed 10 days ago by the collapse of Silicon Valley Bank has prompted many analysts to dial down their expectations for interest rate hikes by the Federal Reserve and Bank of England this week.

Traders work at the stock exchange in Frankfurt, Germany, on March 20.

European markets have opened lower as concerns over the banking sector remain.

On Sunday, Switzerland’s biggest bank, UBS, agreed to buy Credit Suisse in an emergency rescue deal aimed at stemming financial market panic unleashed by the failure of two American banks earlier this month. UBS is paying 3 billion Swiss francs ($3.25 billion) for Credit Suisse, about 60% less than the amount the bank was worth when markets closed on Friday.

Just hours after the deal was announced, the US Federal Reserve and several other major central banks announced a coordinated effort to boost the flow of US dollars through the global financial system with the aim of keeping credit flowing to households and businesses.

People walk past a sign showing numbers for the Hang Seng Index in Hong Kong on Monday, March 20.

Asia Pacific stocks fell on Monday, even as regulators across the region sought to assure investors that their money was safe in the wake of a?bailout for Credit Suisse?and coordinated efforts by global central banks to?boost liquidity?in financial markets.

Both lenders are headquartered in London, but make most of their money in Asia.

Stephen Innes, managing partner of SPI Asset Management, said traders were on high alert because “the more policymakers do, the more investors expect more bad news to come down the pipe, which creates a horrible negative feedback loop.”

HSBC and Standard Chartered were facing greater scrutiny Monday as two global banks that had also “had their share of ups and downs,” according to Innes.

For Standard Chartered, recent speculation that the bank was a “takeover target” may be weighing on the stock, he said. Standard Chartered’s CEO?told CNBC?last month that the bank was “absolutely not” for sale.

HSBC, meanwhile, could be subject to investor jitters after?buying the UK arm?of Silicon Valley Bank, the lender that collapsed earlier this month, Innes said.

But some analysts predicted that markets could pick back up later on Monday if investor nerves settle.

— CNN’s Mark Thompson contributed to this report.

A Credit Suisse office building is pictured in Zurich, Switzerland, on Monday, March 20.

Shares in Credit Suisse plunged after UBS agreed to buy its doomed rival at a huge discount to where they were trading Friday.

In the opening minutes, Credit Suisse fell as much as 62%, UBS shares were 8% lower.

On Sunday, Switzerland’s biggest bank, UBS, agreed to buy Credit Suisse in an emergency rescue deal aimed at stemming financial market panic unleashed by the failure of two American banks earlier this month.

UBS is paying 3 billion Swiss francs ($3.25 billion) for Credit Suisse — about 60% less than the amount the bank was worth when markets closed on Friday.

The Swiss central bank said in a statement that the agreement would “secure financial stability and protect the Swiss economy.”

The US Federal Reserve and several other major central banks announced a coordinated effort Sunday night to boost the flow of US dollars through the global financial system with the aim of keeping credit flowing to households and businesses.

Sunday’s statement came just hours after Swiss authorities?orchestrated an emergency takeover of Credit Suisse?by UBS. Credit Suisse — one of the 30 most important banks in the global financial system — was bleeding money last week after investor and customer confidence collapsed.

Market turmoil triggered by the?second and third biggest bank failures in US history?earlier this month is threatening to make it harder for people to borrow money, US Treasury Secretary Janet Yellen said last week.

“If banks are under stress, they might be reluctant to lend,” Yellen said Thursday in testimony to the Senate Finance Committee. “We could see credit become more expensive and less available.”

Christine Lagarde, president of the European Central Bank (ECB), told reporters Thursday that “persistently elevated market tensions” could further constrict credit conditions that were already tightening in response to rising interest rates.

Read more here.

Signs for UBS and Credit Suisse banks are seen in Zurich, Switzerland, on March 18.

Switzerland’s biggest bank, UBS, has agreed to buy its?ailing rival Credit Suisse?in an emergency rescue deal aimed at stemming financial market panic unleashed by the failure of two American banks earlier this month.

“UBS today announced the takeover of Credit Suisse,” the Swiss National Bank said in a statement. It said the rescue would “secure financial stability and protect the Swiss economy.”

UBS is paying 3 billion Swiss francs ($3.25 billion) for Credit Suisse, about 60% less than the bank was worth when markets closed on Friday. Credit Suisse shareholders will be largely wiped out, receiving the equivalent of just 0.76 Swiss francs in UBS shares for stock that was worth 1.86 Swiss francs on Friday.

Extraordinarily, the deal will not need the approval of shareholders after the Swiss government agreed to change the law to remove any uncertainty about the deal.

Credit Suisse?(CS)?had been losing the trust of investors and customers for years. In 2022, it recorded its worst loss since the global financial crisis. But confidence collapsed last week after it acknowledged “material weakness” in its bookkeeping and as the demise of Silicon Valley Bank and Signature Bank spread fear about weaker institutions at a time when soaring interest rates have undermined the value of some financial assets.

Shares in the 167-year-old bank fell 25% over the week, money poured from investment funds it manages and at one point account holders were withdrawing deposits of more than $10 billion per day, the Financial Times reported. An emergency loan of nearly $54 billion from the Swiss National Bank failed to stop the bleeding.

But it did “build a bridge” to the weekend, to allow the rescue to be pieced together, Swiss officials said Sunday night.

“It is absolutely essential to the financial structure of Switzerland and … to global finance,” he told reporters.

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