• US Bank takes control of Silicon Valley Bank in biggest banking crisis since 'subprime mortgages'
  • Swiss crisis delivers Credit Suisse to UBS at balance price to avoid collapse

The Federal Reserve has raised interest rates by a quarter point, leaving them in a range ranging from 4.75% to 5%. The rise has been in line with what the market expected, and confirms the intention of the central bank to seek a certain balance in the tightrope on which monetary policy is walking and that has on one side the abyss of hyperinflation and on the other that of a banking crisis initiated in several of the medium-sized entities of that country and that has spread to Europe. where it has caused the fall of the Swiss banking giant Credit Suisse.

The rise is most likely less than it would have been if there had been no banking crisis and its effect, in addition, is moderated by the commitment of the US State and the measures of the Federal Reserve itself to ensure the position of the banks, which in practice introduces more money into the economy.

The rise is the same as that of early February, but lower than that of half a point in December, which in turn was also below the four out of three-quarters of points that preceded it. It is highly likely that, under normal circumstances, the 'Fed' would have opted for a half-point hike in the face of the apparent stagnation in the reduction of inflation. However, the weakness of regional banks may have played a decisive role in making the rise smaller. At the same time, the Federal Reserve has already created a funding window for these banks that amounts in practice to a bailout or, as JP Morgan and Deutsche Bank – the largest banks in the US and Germany, respectively – have described it, a "light quantitative easing", in reference to the Fed's purchase of bank bonds carried out in the last decade to inject money into the economy.

It is a situation that could be defined as an upside-down world. Presumably, interest rate hikes increase banks' financial margin, that is, the difference between the interest they pay to the state to obtain financing and the interest they charge their customers for the loans they give them. And that especially benefits medium-sized banks, which do retail operations, and are not dedicated to investing in Wall Street. And in this crisis it is those retail banks, and not the giants operating in the markets that are crashing. The reason is that those banks have so much money that they don't know what to do with it, and they have invested it largely in Treasuries, the safest financial instrument there is. Now, with the increases in official rates, bonds have lost value, and these entities are in losses.

The rise comes after US authorities have launched a series of measures to contain the spread of the crisis. The latest came yesterday, Tuesday, in a speech by Treasury Secretary Janet Yellen to the American Bankers Association, the sector's main employer. In it, Yellen implied that the State is willing to take care of bank deposits over $ 250,000 (230,000 euros), which is the limit covered by the Federal Deposit Insurance Corporation (FDIC), the equivalent of the Spanish Deposit Guarantee Fund. Already in the case of Silicon Valley Bank (SVB), which was the entity whose intervention unleashed the crisis, and that of Signature, which fell two days later, the authorities guaranteed all deposits, regardless of their size.

On Sunday, New York's New York Community Bank announced it would acquire Signature, but the SVB still has no one to take over its assets, even though the state would keep those at risk.

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