Fink’s response to the collapse of Silicon Valley Bank (SVB) and the other wobbles in the sector in the US, was to warn of a “slow rolling crisis”. 

Not so much a cliff-edge 2008 re-revisited but more of a slow-motion car crash that could take out more regional US banks.

The world has changed so much since the last crash and yet some of the fundamentals remain the same.

This time instead of there being an issue with liquidity there is a problem with the consequences of rising interest rates.

Fink’s assessment is that higher interest rates was the first domino. The fall of a bank like SVB was the second. He sees the third being about the implications of higher rates on the value of assets in the US.

Funds invested in illiquid investments, such as private equity, real estate and private credit, “could yet be a third domino to fall”, particularly if they have used borrowed money to increase returns, he wrote.

Credit Suisse gave everybody a scare but it has given some investors quite a few scares long before this week.

Its problems are well known. The Swiss authorities were always going to step in if needed given the size of the bank.

Clearly after years of incredibly cheap money, the cycle has turned and some will struggle to assess, never mind deal with, the consequences.

The most surprising thing was the view in the markets that interest hikes would finish up early in the US or Europe because of these banking wobbles.

One investor stands to make 12 times their money if ECB interest rates fall below 1pc next year. It is an interesting bet but I doubt they will be collecting on it.

Inflation is still a problem. The rate hikes have been the most rapid since the 1980s.

This is because at first central banks were asleep, especially in Frankfurt, to the reality of what was happening with inflation.

In Ireland, the dynamics are a little different. We no longer have massively indebted Irish property companies. Much of the cash that has gone into property development here in recent years has come from abroad.

Listed REITS doesn’t look hugely indebted either. Price drops in commercial property, especially offices, will happen but should not cause a financial earthquake.

When it comes to the housing market we have ready-made buyers with lots of cash stepping in at every opportunity.

I am not talking about hard-pressed young couples, but the State, local authorities and other taxpayer-backed entities trying to buy up as much housing as they can.

Bigger so-called cuckoo funds are also still keen on buying houses here because of the huge demand and relatively poor supply.

Non-household buyers account for 42pc of new homes bought.

So as house prices come under pressure in other countries, these entities will help support the market here. House price growth is slowing and the value of houses will most likely drop. But the scale of the fall should be curtailed by these buying forces.

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Price hikes boost Glanbia salary supplements 

Glanbia managing director Siobhán Talbot enjoyed a huge 73pc jump in her overall remuneration last year to nearly €6m.

Most of the remuneration was performance based and came through the long-term and short-term incentive plans, which topped up a €1.1m salary.

This was the first year senior management could avail of a new incentive scheme which meant they could achieve a higher multiple of salary if certain performance metrics were met.

By all of the standard criteria, Glanbia is doing very well. Its revenues are up. Its earnings are up. Its share price is up 20.6pc in the last 12 months and 12.9pc since January.

Like other companies, Glanbia has managed to navigate the higher-cost inflationary environment of 2022 by putting up its prices.

Higher costs provide great cover for price increases across a range of products, whether to consumers or industry.

The star performer in the group was Glanbia Performance Nutrition (GPN) which posted a 13.9pc increase in revenue and a 10.5pc increase in EBITDA.

However, on a like-for-like basis stripping out the impact of currency, volume sales in this division actually fell by 2.1pc.

This was more than made up for with a 16.7pc pricing increase.

At its ingredients division headline figures showed a 13pc increase in EBITDA. On a like-for-like basis volumes were down 3.5pc.

Price increases of 16.1pc more than made up for less product being sold.

The trick in running a competitive consumer foods business like Glanbia’s Optimum Nutrition is to ensure you have the right product, the right marketing and the right market position to be able to get price increases through.

After all, health supplements are a very tough business, especially in the US. Glanbia managed to grow its earnings margin in two of its three big divisions.

This could only be done by keeping a tight control on operating costs as well as hiking prices.

It is a tough balance that Talbot and the executives at Glanbia seem to have got right.

And they have been handsomely rewarded for it.

The downside of relying on price increases in an inflationary environment is that you can’t do it too often. This year won’t be easy.

Banking lessons from Anglo to SVB

The loss of Silicon Valley Bank (SVB) to the international tech financing world is pretty significant.

So many growing tech companies in the US and in Ireland have benefited from its presence and what some describe as its ‘helping-hand’ approach.

Perhaps that was part of the problem. Tech executives loved SVB, partially because they saw it as a bank that resembled their own businesses – entrepreneurial, high growth, a listening approach and highly innovative.

But are these the qualities a bank should aspire to? Most of its staff were still working from home when it collapsed.

As one former banker told the FT during the week, “some people worked from Miami, some moved to Las Vegas or a cabin in the woods and did the digital nomad thing.”

A bank that “understands” its customers in a way that it copies what these entrepreneurial businesses do, sounds a bit like Anglo Irish Bank back in the day.

Wasn’t Anglo high growth, entrepreneurial, innovative, flexible (which often means quick lending decisions) and in touch with its customer base? Well it imploded too.

SVB’s governance, strategy and culture are now being looked at closely especially by regulators. Bolting and stable doors come to mind, a bit like Anglo too.

As one banker said last week, SVB wasn’t “cut throat like Goldman Sachs”. But Goldman is still in business.