2023-03-23 07:14:11 ET
- Citigroup ( NYSE: C ) CEO Jane Fraser told the Economic Club of Washington D.C. on Wednesday, as reported by Reuters, that she has confidence in U.S. banks after a series of closures rattled investors and fueled turmoil in global financial markets.
- "The banking system is pretty sound, and large and regional banks are well-capitalized. This is not a credit crisis. This is a situation where it's a few banks that have some problems, and it's better to make sure that we nip that in the bud," she added.
- Since the financial industry turmoil has commence with Silicon Valley Bank ( SIVB ) downfall, Credit Suisse ( CS ) takeover by UBS ( UBS ), major lenders agreeing to deposit $30B in bankrupt First Republic ( FRC ), Fraser is one of the first large bank CEO to comment.
- Fraser highlights that while Citi is not interested in buying First Republic it contributed $5B to the bank as a sign of confidence and Citi expects it to be paid back.
- The move to shore up First Republic was an unprecedented show of unity among banking behemoths that are normally fierce competitors, she said. "We usually try and kill each other in different deals that we're trying to do. But in this instance, this is one where we're in a strong position, we want to stop what could have been a problem," she commented.
- Praising the quick action by U.S. regulators for avoiding a broader crisis, Fraser says - "It's very important to protect depositors. The banking system everywhere around the world depends on confidence, and that confidence has to be in the safety and security of deposits."
- Yesterday, the company announced that Anand Selva, the head of consumer banking operations, will also serve as the company's COO .
- In past 1-month trading session, Citi stock has eroded 13% in value.
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Citigroup CEO Jane Fraser says regional banks are well-capitalized, expects $5B to be paid back