ANZ’s CEO says banking turmoil has potential to trigger financial crisis

Australia and New Zealand Banking Group’s chief says the latest turmoil in the global banking system has the potential to trigger a financial crisis, though it is too early to predict if it could lead to a repeat of 2008.

Authorities around the world are on high alert for the fallout from recent turmoil at banks following the collapse of Silicon Valley Bank (SVB) and Signature Bank in the US and the emergency takeover of Credit Suisse.

But he said it was premature to assume the current condition could result in “another GFC”, referring to the global financial crisis about 15 years ago that plunged the world’s major advanced economies into their worst recession since the Great Depression in the 1930s.

Australian banks did not suffer as much as those in the US and Britain during the 2008 crisis, thanks in part to tighter lending standards and a more resilient home economy.

Australia’s banking regulator, soon after the collapse of startup-focused lender SVB, said it had intensified supervision of the local banking industry and sought more information on the potential impact.

Global regulators have acted much quicker to support banks this time, having learned lessons from the prior crises, Elliott said.

Related Articles

Back to top button