Hey there, finance aficionados! Big news from the world of central banking: it's time to fasten your seatbelts because digital currencies are taking center stage, and central banks are hopping on board the innovation train. 🚂💨

Joachim Nagel, head honcho at Deutsche Bundesbank and an ECB bigwig, recently sounded the alarm on the urgent need for central banks to get with the times and embrace digital currencies – and fast. Speaking at the BIS Innovation Summit, Nagel painted a picture of a rapidly evolving banking landscape, where traditional models are facing unprecedented challenges. 💼📈
Gone are the days of old-school banking – Nagel knows it, and he's not mincing words. He's all about leveraging distributed ledger technology (DLT) as the secret sauce for modernization, declaring, "We need to shake things up, and DLT is our ticket to ride." 🎟️🔗
But Nagel isn't the only one ringing the digital currency bell. Francois Villeroy de Galhau, the top dog at the Bank of France, is singing the same tune. He's all in on integrating digital currencies to keep up with the times and maintain stability in an ever-changing financial landscape. 💪🏛️
And get this – the ECB has its sights set on a digital euro by October 2025. That's right, folks – it's not just talk; it's action! 🚀💶
But hold your horses – not every central bank is jumping in headfirst. The Swiss National Bank (SNB) is treading cautiously with Project Helvetia III, exploring digital currencies while keeping a wary eye on potential risks. Thomas J. Jordan, the SNB's big cheese, knows the importance of central bank money for financial stability but is wary of the potential pitfalls of retail CBDCs. 🇨🇭💼
It's a delicate balancing act, folks – innovation tempered with caution. But one thing's for sure: the winds of change are blowing, and digital currencies are here to stay. Central banks are embracing the future with open arms, and the financial world will never be the same. 💼🌐
Stay tuned for more updates as the digital currency revolution unfolds – it's going to be one heck of a ride! 🎢💰

#banks #CBDC #digitalcurrency

In the most recent week, #banks borrowed a total of $164.8 billion from two #FederalReserve backup facilities, a hint of heightened financial pressures in the wake of #SiliconValley Bank's bankruptcy.

According to data released by the Fed, banks borrowed a record-breaking $152.85 billion through the discount window, which serves as their traditional source of liquidity, in the week ending March 15. This is an increase from $4.58 billion the week before. The previous record-breaking amount was $111 billion, attained during the financial crisis in 2008.

The statistics also revealed $11.9 billion in borrowing under the Bank Term Financing Program, the Fed's brand-new emergency safety net that was introduced on Sunday.

In light of last week's failures of #SVB of California and #SignatureBank of New York, the credit provided through the two backstops as a whole reveals a banking sector that is still vulnerable and coping with deposit migration.

Additional credit extensions throughout the week totaled $142.8 billion, which includes loans made to bridge banks for SVB and Signature Bank by the Federal Deposit Insurance Corp.

On the other hand, according to EPFR Global statistics quoted by Bank of America Corp., money-market funds had inflows of $113 billion, the highest level since April 2020, while Treasuries saw inflows of $9.8 billion, the highest level since May 2022, in the week ending March 15.

Swiss authorities agreed to change the country's regulations to bypass the shareholder vote and announced the deal over the weekend.

UBS Group agreed to buy ailing rival Credit Suisse for $3.25 billion on March 19 as part of an "emergency order" to prevent instability in financial markets .

UBS has agreed to buy Credit Suisse for more than $2 billion, the Financial Times reported earlier, citing an insider. However, UBS's latest statement revealed that the total consideration for the deal is about 3 billion CHF, or $3.25 billion. That's still a significant bargain compared to Credit Suisse's March 17 market cap of 7.5 billion francs, or about $8 billion .

“This acquisition is attractive to UBS shareholders. But let's be clear about Credit Suisse. It is a "lifebouy". We have structured a transaction that preserves the remaining value in the business while limiting our negative exposure”

said Colm Kelleher, President of UBS.

To seal the deal, Swiss authorities agreed to amend the country's regulations to bypass a shareholder vote and announced the deal over the weekend before the market opened.

As part of the deal, the Swiss National Bank also committed to providing UBS with more than $100 billion in liquidity, according to reports.

The discussions were jointly initiated by the Swiss Federal Ministry of Finance, the Swiss Financial Market Supervisory Authority (FINMA) and the Swiss National Bank, and the acquisition is fully supported, UBS said in a statement.

UBS was not the only solution

Swiss authorities were considering alternatives to Credit Suisse in case the deal with UBS falls through over the weekend, including nationalizing the bank in whole or in part as an emergency solution.

Credit Suisse's rescue plan would also include losses for bondholders, raising concerns among European regulators. According to them, this would undermine investor confidence in the European financial sector.

UBS and Credit Suisse have been in talks with regulators since March 15, after Credit Suisse's largest shareholder, the National Bank of Saudi Arabia, said it would not increase its investment in the Swiss bank due to regulations . The comments added to concerns about the bank's ability to generate profits, sparking fears about a possible shareholder financing.

Credit Suisse was founded in 1856 to finance the expansion of the Swiss railways. It was considered the second largest bank in the country.

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#CreditSuisse #UBS #banks #bankingcrash #switzerland

The Dow Jones Industrial Average fell by 0.9%, or 280.83 points, to 31,874.57, as concerns over a banking crisis in Europe pressured the broader market.

The S&P 500 dropped 0.7% to 3,891.93, while the Nasdaq Composite rose 0.05% to 11,434.05.

The Swiss central bank's announcement that it would provide liquidity to Credit Suisse if necessary helped the indexes regain some ground in afternoon trading.

Credit Suisse's U.S.-listed shares fell by nearly 14% after it revealed "certain material weaknesses" in its internal controls over financial reporting for the years 2021 and 2022.

The financial sector's crisis has centered around regional banks in recent days, and the big banks saw declines in sympathy with Credit Suisse and the European Bank sector.

#banks #crypto2023

A new report highlights a troubling trend of US banks closing customers' accounts and freezing withdrawals without prior warning. Numerous individuals have reported sudden loss of access to both their checking and savings accounts, leading to severe financial hardships. This article delves into the case of Elad Nehorai, whose account with Bank of America was shut down without explanation, leaving him unable to access his life savings.

The Surge in Account Closures:

The Banking Policy Institute has disclosed that the number of Suspicious Activity Reports (SARs) submitted by banks to law enforcement has doubled in less than a decade, reaching approximately 1.4 million in 2021, up from around 830,000 in 2014. These reports are often cited as the reason for account closures, as banks act upon concerns of suspicious behavior exhibited by their customers.

The Lack of Follow-Up:

Surprisingly, despite the significant increase in SARs, only 4% of these reports result in any follow-up by law enforcement. Furthermore, only a small fraction of those follow-ups lead to arrests and convictions, indicating that the majority of reported suspicious activities do not merit further investigation or action.

Elad Nehorai's Experience:

Elad Nehorai's ordeal with Bank of America serves as a poignant example of the impact of sudden account closures. Upon logging into his account, Nehorai received an alarming alert, prompting him to visit a bank branch in West LA. There, he was shocked to learn that his account had been closed, effectively denying him access to his life savings. The bank provided no explanation, leaving Nehorai distressed and financially crippled. #usa

Challenges of Dealing with Banking Giants:

In Nehorai's case, as in many others, the power and influence of large banking institutions seem overwhelming, making it challenging for individuals to assert their rights or seek explanations for abrupt account closures. The lack of control over such situations can be distressing and leave customers feeling powerless.

Media Intervention and Outcome:

After Nehorai's story caught the attention of CBS Los Angeles, they sent a television crew to cover the situation. Interestingly, although his account remained closed, the media attention prompted the bank to grant him permission to transfer his money to another account. This suggests that public exposure can have an impact on banks' actions, potentially pressuring them to reconsider their decisions.

Explanation by Bank of America:

In response to media inquiries, Bank of America stated that an FBI report triggered the closure of Nehorai's account. Interestingly, Nehorai himself had submitted the report to the FBI, informing them of a scammer impersonating him via email to solicit money from one of his clients. However, the bank's actions raise questions about their account review processes and customer communication protocols.

In Summary:

The growing number of abrupt account closures in US banks raises serious concerns about the need for transparency and fair treatment of customers. While banks must remain vigilant against fraud and suspicious activities, it is equally important to ensure that innocent customers are not unjustly impacted. The story of Elad Nehorai serves as a stark reminder of the power dynamics between individuals and massive financial institutions, highlighting the importance of consumer protection measures and a fair and efficient resolution process for affected customers. #bank #banks #bankruptcy