US banks have faced a significant outflow of capital for the past year, with $910 billion in deposit flight since May 2022, as data from the Federal Reserve reveals. The Daily Hodl brings the information, and surely plenty of folks won’t like it.
The capital held by banks on behalf of depositors has faced a decrease from $18.06 trillion to $17.15 trillion, with $13 billion leaving the system only in the last week. The failure of banks such as Silicon Valley Bank, Signature Bank, and First Republic, along with the collapse of Credit Suisse, has left their impact on regional US banks such as PacWest and Western Alliance. These banks have stated that they have not witnessed above-average withdrawals since March 31st.
The Federal Reserve’s interest rate hikes are cited as a key factor contributing to the precarious position of over 700 American banks that face”significant safety and soundness risk.”
Fed Chair Jerome Powell maintains that the banking system is sound and resilient, but some traders anticipate further rate hikes in the future.
Jerome Powell was born on February 4, 1953, and he’s also an American economist and lawyer. Powell’s career and life have been marked by a combination of financial expertise, public service, and also leadership roles in both the public and private sectors.
After Powell earned a law degree from Georgetown University Law Center, he practiced law and worked in investment banking before entering the public service. Back in the early 1990s, the current Fed Chair served as Undersecretary of the Treasury under President George H. W. Bush, focusing on policy matters related to financial institutions.
Jerome Powell became the Chair of the Federal Reserve in February 2018, when he succeeded Janet Yellen.