RIA Novosti published an article under the heading “Kostin announced the largest banking crisis in the United States since 2008”, which says:
“The biggest banking crisis since 2008 is unfolding in the US, and the problems are spreading to Europe as well,” VTB CEO Andrey Kostin said at a meeting with Russian President Vladimir Putin.
“You look at what is happening now in the United States: in fact the biggest financial banking crisis since 2008, and it is already spreading to Europe,” he said.
According to the banker, the sanctions against Russia destroyed the world trade system and led to an increase in inflation, and "the attempts of the West to solve this in standard ways led to the depreciation of banking assets."
“In the end, we have what we have. But our banking sector feels secure. I don’t think there will be any problems,” Kostin concluded.
As CNN financial analyst Nicole Goodkind points out , formally the 2023 banking crisis in the United States was even larger than the 2008 crisis: the total assets of the three failed banks amounted to $559 billion, and the assets of the 25 banks that failed in 2008 amounted to $523 billion. But this is not had a significant negative impact on the economic situation in the country. Analysts of the Russian investment company BCS Mir Investments noted at the end of June:
“As we approach the middle of 2023, the stock market (S&P 500) could have the most impressive first half performance since 2019. <…>
As of mid-June 2023, the growth of the S&P 500 (including dividends) since the beginning of the year was 15.8%, without dividends – 14.8%. The cumulative return of the Dow Jones Industrial Average is 4.6%, the Nasdaq Composite is 31.4%. <…>
And what happened in those years when the market growth in the first half of the year was at least 10%? We counted 15 such years: in the average, capitalization increased by 23.3% following the results of each of them. The market usually not only maintained gains, but added an additional 750 bp in the second half of the year. n. to profitability. <…> If this year the recession bypasses the United States and the world economies, and if we exclude the possibility of “black swans”, then the forecast for the market for 2023 remains positive.”
Kostin's claim that the US banking crisis continues to unfold is debatable to say the least. At the end of March, researchers from Northwestern, Columbia and Stanford universities, as well as the University of Southern California, concluded that about 200 banks were at risk. But the bank's most recent failure came on May 1, when the troubled First Republic Bank, whose shares fell 97% in price, was bought by the nation's largest bank, JPMorgan Chase. The latter's CEO, Jamie Dimon, then noted that his company's emergency intervention put an end to the immediate shocks of the banking crisis. Since then, there have been no reports of any US bank being threatened. However, some analysts, such as the same Nicole Goodkind, who at the end of May published an article “The banking crisis has subsided, but has not ended”, believe that a certain danger remains for small regional banks; a study by the Federal Reserve Board found that there had been an "unprecedented flight of deposits from the regional banks to the big banks".
The largest bank to fail was First Republic Bank, which ranked 14th in the country in terms of assets. There are no signs of any threat to the larger banks.
The main causes of the crisis, contrary to Kostin's assertion, have nothing to do with sanctions against Russia. The cause of the problems for the affected banks was the increase in the refinancing rate, due to which the national bonds in which many banks invested during the pandemic, when the rate was kept at a very low level, ceased to generate income. In turn, the refinancing rate had to be raised to counter inflation caused by the policy of stimulating the economy during the pandemic: the administration of Donald Trump in 2020 pumped the economy with fiat dollars.
The bursting "bubble" in the cryptocurrency market also played its role in the deterioration of the position of some banks; this was the main reason for the collapse of Signature Bank,which invested heavily in cryptocurrencies.
Sanctions against Russia did not have any significant impact on the economic situation in the United States, since the volume of trade between the two countries was small: in 2021 it was $34.4 billion, with total US exports of $2.55 trillion. In the first months after Russia's attack on Ukraine, energy prices rose sharply, but this was only beneficial for the United States as one of the world's largest exporters of oil and oil products.
