The closure of three U.S. banks in the space of a week has led to an influx of fresh cash for Wall Street’s biggest institutions, with Bank of America reportedly raking in over $15 billion in customer deposits recently.
The collapse of Silicon Valley Bank SIVB,
For Bank of America BAC,
The report said other big banks such as Citigroup C,
Separately, State Street Corp. Chief Executive Officer Ron O’Hanley told Bloomberg TV that Tuesday’s move by Moody’s Investors Service’s, which lowered its outlook on the U.S. banking system to negative from stable, was “a terrible overreaction.”
“There were a lot of unique circumstances around the banks in question—both on the asset and liabilities side,” O’Hanley said on Wednesday. “I don’t think it’s helpful when rating agencies treat entire sectors the same way.”
Meanwhile, shares of several regional banks showed signs of continuing Tuesday’s rebound on Wednesday, though most haven’t fully recovered from severe stress seen in recent days.
Shares of First Republic Bank FRC,
Investors have been grappling to keep up with fast-paced events in the financial sector in recent days. Over the weekend, the U.S. government rolled out the new Bank Term Funding Program to shore up unsecured deposits as Signature Bank collapsed over the weekend just days after Silicon Valley Bank, a unit of SVB Financial SIVB, shut down after a rush of withdrawals.
Read: SVB’s collapse makes it impossible to say what stocks are worth as bond-market volatility explodes
