SVB Collapse ‘Limited’ Despite European Banking Stocks Struggling Under Credit Suisse

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European Commissioner Mairead McGuinness said that Silicon Valley Bank’s collapse had a “small effect” on the European Union. However, she warned everyone to stay watchful for anything else that could happen. Even so, stocks at Europe’s biggest banks dropped by up to 10% on March 15th.

Warning to the EU

Mairead McGuinness, who is the European Commissioner for financial services, said that the effects of Silicon Valley Bank’s fall in the United States have not been felt too much in the European Union yet. However, on March 15 she warned EU parliament to stay aware of any further consequences of this event happening in international markets.

The European Commission (EC) has taken notice of what is happening with banking in the United States. They want to understand if they need to change anything with their own banks. Commissioner McGuinness told the EU parliament that while this may not affect Europe directly, it’s important for them to think about how it could help them.

Impact of SVB Collapse on European Banks

Before Mr. McGuinness commented on how the collapse of SVB would affect the European Union, someone from the European Commission said that since SVB had a small presence in Europe, it wouldn’t have a big impact. Even though the European Commission believes that Europe won’t be badly affected by this crisis in U.S. banking systems, Mr. McGuinness warned that inflation is still a huge problem.

Even though McGuinness said it was okay, the prices of Europe’s largest banks dropped by 10% on that day. This decrease in stock prices happened because of Credit Suisse, a bank from Switzerland. Its stocks went down to the lowest point ever when the person who helps to support it, the Saudi National Bank, said they couldn’t help anymore.

The Saudi National Bank has made a decision after an audit from PwC found some problems with how Credit Suisse is managing their stuff. After hearing news that the Swiss National Bank was helping out, Credit Suisse share prices have gotten better. What do you think of this story? Tell us in the comments!