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☆ Investors are pouring record amounts into money market funds as rates rise. How to pick the best one
▼ + stars: | 2023-03-28 | by ( Darla Mercado | Cfp | ) www.cnbc.com time to read: +4 min

Investors in search of relative safety and attractive yields are piling into money market funds at record levels. In particular, they fled to government money market funds – which hold U.S. Treasurys – with retail assets surpassing $1.25 trillion. Here's what you should know as you browse: Three varieties In addition to government money market funds, there are also tax-exempt money market funds. She noted that there are also some state-specific money market funds, which might make sense for residents in high-tax jurisdictions. Money market funds also shouldn't be confused with money market accounts – which are interest-bearing accounts you can open at a bank.

☆ First Citizens to buy large chunk of failed Silicon Valley Bank
▼ + stars: | 2023-03-27 | by ( Elliot Smith | ) www.cnbc.com time to read: +1 min

Photo illustration, the Silicon Valley Bank logo is visible on a smartphone, with the stock market index in the background on the personal computer on March 14, 2023, in Rome, Italy. First Citizens Bank & Trust Co will buy Silicon Valley Bank's deposits and loans, the U.S. Federal Deposit Insurance Corporation said Monday, just over two weeks after the biggest U.S. banking collapse since Lehman Brothers. The deal includes the purchase of approximately $72 billion of SVB assets at a discount of $16.5 billion, but around $90 billion in securities and other assets will remain "in receivership for disposition by the FDIC." It comes after the regulator transferred all SVB deposits and assets into a new "bridge bank" earlier this month in an effort to protect depositors of the failed lender. "The 17 former branches of Silicon Valley Bridge Bank, National Association, will open as First–Citizens Bank & Trust Company on Monday, March 27, 2023," the FDIC statement said Monday.

REUTERS/Murad Sezer/IllustrationORLANDO, Florida, March 27 (Reuters) - The most extraordinary outcome of the March banking shock would be if the problem dissipated quickly. Many people hope the crisis of confidence infecting global banking this month can be repelled almost as quickly as it appeared. SAVINGS AND LOANS DEBACLEThe easy comparison for any banking or market turmoil is the GFC of 2007-08. But crises don't have to be equal to or worse than the world's most calamitous financial disaster in a century to be extremely damaging. But other banking crises follow the same playbook, even if their outcomes are not as extreme.

☆ The banking crisis has college students on edge about Wall Street jobs and internships. 'I just want to know what the plan is.'
▼ + stars: | 2023-03-27 | by ( Emmalyse Brownstein | ) www.businessinsider.com time to read: +6 min

That's the concern plaguing aspiring investment bankers across the country as they watch the banking crisis unfold. "I think there's definitely a sense of unease in finance," said Asif Rahman, co-founder of Wall Street career coaching company Office Hours. Over at SVB's investment banking arm, incoming first-year analysts have been told that their jobs are secure. "We've reached out to all of our incoming analysts and interns. "The incoming summer interns are worried about low return offer rates," the professor said.

☆ Factbox: The biggest financial crises of the last four decades
▼ + stars: | 2023-03-25 | by ( ) www.reuters.com time to read: +4 min

Fears of banking contagion remain, and investors are worried that global economies will suffer if the effects of higher interest rates torpedo more lenders. Michael Milken had helped popularize the financial instrument, with many using it as a way of funding leveraged buyouts. The country ended up getting external financial support from the International Monetary Fund and a $50 billion bailout from the United States. GLOBAL FINANCIAL CRISIS OF 2008The biggest financial crisis since the Great Depression was rooted in risky loans to shaky borrowers, which started to lose value after central banks raised interest rates in the period leading up to the crisis. EUROPEAN DEBT CRISISSpurred by the 2008 financial crisis, surging debt at some of the major European economies led to a loss of confidence in the region's businesses.

☆ Analysis: Banking woes, Fed keep U.S. market investors on edge
▼ + stars: | 2023-03-25 | by ( David Randall | ) www.reuters.com time to read: +5 min

But investors are guarded, wary that another bank run could erupt if people believe U.S. or European regulators won't protect depositors. Uncertainty over the Fed's intentions is amplifying investors’ hesitation in stocks and sparking huge swings in U.S. government bond prices. The Fed raised rates by 25 basis points on Wednesday but indicated it was on the verge of pausing further increases. Risk assets have been somewhat resilient despite the concerns in the banking sector, said Jason England, global bonds portfolio manager at Janus Henderson Investors. England expects longer-duration bond yields to start to rise from current levels, making short-term bonds and money market funds more attractive.

☆ Get ready for stocks and real estate to crash - and the US economy to crater, 'Rich Dad Poor Dad' author warns
▼ + stars: | 2023-03-24 | by ( Theron Mohamed | ) www.businessinsider.com time to read: +2 min

Robert Kiyosaki expects stocks, bonds, and real estate to crash as higher interest rates bite. The "Rich Dad Poor Dad" author slammed the Fed for choking growth and eroding the US dollar's value. "Raising interest rates will crash stocks, bonds, real estate, & US dollar," the personal-finance guru and "Rich Dad Poor Dad" author tweeted on Thursday, adding that he expects the vast derivatives market to tank as well. "Saving money & investing in a well diversified portfolio of stocks, bonds, mutual funds & ETFs is risky advice," he tweeted in February. The founder of The Rich Dad Company has been sounding the alarm on an epic market crash and massive recession for more than 18 months.

☆ Swiss franc grapples with safe-haven identity crisis after Credit Suisse
▼ + stars: | 2023-03-24 | by ( Samuel Indyk | ) www.reuters.com time to read: +5 min

Money managers ditched the Swiss franc at the fastest rate in two years last week in the run-up to the dramatic takeover of Credit Suisse (CSGN.S) by UBS (UBSG.S). "You still have some of the safe-haven hedging properties in the Swiss franc but it can only take so much when the risk ends up being so concentrated in the Swiss economy and the Swiss financial sector," Kundby-Nielsen added. "If it hadn't been Credit Suisse, but any other European bank getting into trouble, you would have seen the Swiss franc rising sharply because it would have been the safe haven for European risk," said Francesco Pesole, FX strategist at ING. "The franc is not an 'all-weather' safe haven and so far we've not had the type of market pressures that would typically lead to franc appreciation," he said. SWISSIt's one thing for the franc to have lost some favour among investors during a Swiss-centric crisis, but quite another to suggest its days as a safe haven are numbered.

Similarly, the U.S. economy and stock markets tend to outperform during booms and draw in overseas investment that lifts demand for dollars. Surely times of great banking and credit stress should boost the greenback? And now we face a bout of severe banking stress alongside stubbornly high inflation that had almost all major central banks raising interest rates again over the past week despite the pretty clear underlying credit stress. JPMorgan's take on the stressed side of the dollar smile last week pointed out that "the underlying macro-financial pathology that necessitates lower yields is the primary determinant of dollar direction". Clearly, the dollar smile is no laughing matter.

☆ Spooked dealmakers scurry back into their foxholes
▼ + stars: | 2023-03-23 | by ( Jeffrey Goldfarb | ) www.reuters.com time to read: +8 min

NEW YORK, March 23 (Reuters Breakingviews) - Jonathan Kanter, a lawyer by training, has become something of a magician. Pay closer attention, however, and Kanter is methodically rewriting a decades-old regulatory playbook. Last year, these breakup charges reached their highest level in a decade, at an average 4.5% of deal prices. The Department of Agriculture partnered with the DOJ on the case, another feature of Kanter’s plan of attack. As legal weaknesses emerge, dealmakers should be in position to better structure transactions and defend themselves at trial.

☆ Big investor in Credit Suisse bonds says 'bail-in' system worked
▼ + stars: | 2023-03-22 | by ( Herbert Lash | ) www.reuters.com time to read: +3 min

The firm's exposure to Credit Suisse AT1s represented 1.32% of Spectrum's assets under management (AUM) on Feb. 28. In 2021 and early 2022 Spectrum held about $400 million of Credit Suisse AT1 bonds, Jacoby said. The Credit Suisse debt represents about 12% of the benchmark for CoCos, a massive slice of the ICE BofA U.S. dollar contingent capital index (.MERCOCO), he said. "We had been paring back in Credit Suisse, had an internal negative outlook for a little over a year." "This is a Credit Suisse event and this is a Swiss bank regulation event, this is not a global disaster for CoCos."

☆ Wall Street is confident high-yielding banks won't cut their dividends
▼ + stars: | 2023-03-22 | by ( Scott Schnipper | ) www.cnbc.com time to read: +5 min

Atlanta's Truist Financial ($41 billion) now yields 6.2% while Minneapolis's U.S. Bancorp ($53 billion) pays 5.1% on its common stock. After all, high dividend yields are often a sign of financial or business distress, or a red flag that the payments so many mom-and-pop investors depend on are unsustainable. Wall Street just doesn't think most payouts will be cut — so long as any recession this year stays on the mild side. "Despite these lower dividend growth expectations, we believe these bank holdings still have attractive dividends," Peris added. A final straw in the wind: Wall Street has issued dozens of research reports since Silicon Valley Bank went under.

☆ A retro red, blue, and white Credit Suisse ski cap is attracting ferocious bids online — and prices are now up to $200
▼ + stars: | 2023-03-21 | by ( Huileng Tan | ) www.businessinsider.com time to read: +3 min

Credit Suisse merch is popping up in online marketplaces following the 167-year-old lender's merger with UBS. Branded gold bars and bags are some of the other Credit Suisse merch available on the platforms. One listing of the Credit Suisse cap started at 80 francs on March 19. Bidding on other Credit Suisse merch — such as this tote bag and a coin bank — also attracted four and five bids, respectively. And while Credit Suisse merch may be attracting buyers, the same cannot be said for the shares of the 167-year-old lender.

LONDON, March 20 (Reuters) - Bank of America's electronic stocks desk has halted trading with a desk at Credit Suisse that uses computer-led strategies, "out of an abundance of caution effective today," an email seen by Reuters on Monday said. Bank of America (BAC.N) said it would no longer send trades to Credit Suisse's "ATS Crossfinder". That trading platform anonymously matches buy and sell orders for the same kinds of securities, according to the Credit Suisse (CSGN.S) website. Bank of America sent the email to traders and hedge fund clients on Monday morning. Credit Suisse declined to comment on the email and Bank of America also declined to comment.

March 20 (Reuters) - Shares of U.S. lender First Republic tumbled nearly 50% on Monday on fears it will need a second rescue to stay afloat, bucking a broader rally in bank shares driven by UBS Group's state-backed takeover of Credit Suisse. "First and foremost, the Credit Suisse, UBS merger certainly takes a lot of stress out of the global banking system." The 3 billion Swiss franc ($3.2 billion) deal for the troubled Swiss bank - which was once worth more than $90 billion - was engineered by Swiss regulators and announced on Sunday. European bank shares (.SX7P) rebounded from recent losses, while on Wall Street the S&P 500 banks (.SPXBK) index recovered 0.6%. [1/2] Buildings of Swiss banks UBS and Credit Suisse are seen on the Paradeplatz in Zurich, Switzerland March 20, 2023.

☆ Credit Suisse memorabilia up for grabs in online shops after merger
▼ + stars: | 2023-03-20 | by ( ) www.reuters.com time to read: +1 min

[1/3] Gold bars from the Credit Suisse are seen in a shop in Zurich, Switzerland March 20, 2023. Dozens of bars of gold, stamped with the name of the issuer - the 167-year-old Credit Suisse - were uploaded to the country's most popular online marketplaces, Ricardo.ch and tutti.ch. With it still unknown whether the Credit Suisse brand will be continued, the sellers are seeking to attract those looking to snap up a piece of Swiss financial history. Credit Suisse is expected to remain an independent brand until the merger is complete, at which point UBS will decide whether to pull the plug on the separate Credit Suisse identity. Corporate swag from recently failed Silicon Valley Bank is also proving popular online, as is merchandise linked to Lehman Brothers, which filed for bankruptcy at the height of the 2008 financial crisis.

In a package engineered by Swiss regulators on Sunday, UBS Group AG (UBSG.S) will pay 3 billion Swiss francs ($3.2 billion) for 167-year-old Credit Suisse Group AG <CSGN.S>, which was once worth more than $90 billion. European bank shares inched into positive territory (.SX7P) while shares in U.S. financial giants Citigroup (C.N) and JPMorgan Chase (JPM.N) rose 1.2% and 0.7% respectively. Investor focus had shifted to the massive blow some Credit Suisse bondholders will take, a new worry in a rolling banking sector crisis sparked by the collapse of midsize-U.S. lenders Silicon Valley Bank (SVB) and Signature Bank (SBNY.O) earlier this month. [1/2] Buildings of Swiss banks UBS and Credit Suisse are seen on the Paradeplatz in Zurich, Switzerland March 20, 2023. QUESTIONS FOR UBSThe deal to buy Credit Suisse will make UBS Switzerland’s only global bank and the Swiss economy more dependent on a single lender.

In a package engineered by Swiss regulators on Sunday, UBS will pay 3 billion Swiss francs ($3.23 billion) for 167-year-old Credit Suisse Group AG (CSGN.S) and assume up to $5.4 billion in losses. Investor focus has now shifted to the massive blow some Credit Suisse bondholders will take, adding to anxiety about other banking sector risks including contagion and the fragile state of U.S. regional lenders. UBS acquiring Credit Suisse for 3 billion francs a week ago would have seemed like a terrific deal. Buildings of Swiss banks UBS and Credit Suisse are seen on the Paradeplatz in Zurich, Switzerland March 20, 2023. QUESTIONS FOR UBSThe deal to buy Credit Suisse will make UBS Switzerland’s only global bank and the Swiss economy more dependent on a single lender.

European bank shares slumped, with an index of leading lenders (.SX7P) down 5.8%. Credit Suisse shares slumped 62%, reflecting the huge loss its shareholders will see in their investment in the bank. Monetary authorities in Singapore and Hong Kong, where Credit Suisse hosts large regional offices, separately said the Swiss bank's business continued without interruption. And Credit Suisse urged its staff to go to work, according to a memo to staff seen by Reuters. Credit Suisse staff arriving to work in Hong Kong and Singapore on Monday morning, however, fretted about retrenchments and retaining business.

The European Central Bank vowed to support euro zone banks with loans if needed, adding the Swiss rescue of Credit Suisse was "instrumental" in restoring calm. There are also concerns about what happens next at Credit Suisse and what that means for investors and employees. The Swiss central bank said Sunday's deal includes 100 billion Swiss francs ($108 billion) in liquidity assistance for UBS and Credit Suisse. Credit Suisse shares had lost a quarter of their value last week. The bank was forced to tap $54 billion in central bank funding as it tries to recover from scandals that have undermined confidence.

The logos of Swiss banks Credit Suisse and UBS on March 16, 2023 in Zurich, Switzerland. Credit Suisse shares collapsed by 60% at around 9:05 a.m. London time (5:05 a.m. Swiss authorities and regulators helped to facilitate the deal, announced Sunday, as Credit Suisse teetered on the brink. The size of Credit Suisse was a concern for the banking system, as was its global footprint given its multiple international subsidiaries. "This suggests that a substantial part of Credit Suisse's $570bn assets may be either impaired or perceived as being at risk of becoming impaired.

☆ Credit Suisse memorabilia up for grabs in online shops
▼ + stars: | 2023-03-20 | by ( ) www.reuters.com time to read: +1 min

☆ Buy Berkshire Hathaway stock for Warren Buffett's steady hand during crises, says Morningstar
▼ + stars: | 2023-03-20 | by ( Yun Li | ) www.cnbc.com time to read: +2 min

Warren Buffett's long history of aiding failing banks is one reason for investors to buy Berkshire Hathaway shares now, in the midst of the latest banking blowup, according to Morningstar. "Another banking crisis, another call to Buffett," Morningstar analyst Greggory Warren said in a note Monday. The legendary investor has been a white knight for troubled banks on other occasions. Buffett also famously came to Goldman Sachs' rescue with a $5 billion cash infusion after the collapse of Lehman Brothers in 2008. The analyst said Berkshire shares are appealing right now and could serve as downside protection given its diverse businesses and unmatched balance sheet strength.

☆ Fed and other central banks try to head off crisis by boosting flow of dollars
▼ + stars: | 2023-03-19 | by ( Mark Thompson | ) edition.cnn.com time to read: +3 min

Credit Suisse — one of the 30 most important banks in the global financial system — was bleeding money last week after investor and customer confidence collapsed. Swap lines are agreements between two central banks to exchange currencies. They allow a central bank to obtain foreign currency from the central bank that issues it, and distribute it to commercial banks in their country. During the global financial crisis of 2008 following the collapse of Lehman Brothers, funding markets dried up because of an extreme aversion to risk. From Monday through at least the end of April, the Fed and other central banks will make dollars available on a daily basis, rather than weekly.

The terms of the deal will see Credit Suisse shareholders receive 1 UBS share for every 22.48 Credit Suisse shares they hold. "This acquisition is attractive for UBS shareholders but, let us be clear, as far as Credit Suisse is concerned, this is an emergency rescue. The Swiss National Bank pledged a loan of up to 100 billion Swiss francs ($108 billion) to support the takeover. UBS initially offered to buy Credit Suisse for around $1 billion Sunday, according to multiple media reports. It reported a full-year net loss of 7.3 billion Swiss francs for 2022 and expects a further "substantial" loss in 2023.

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