According to Fox Business reporter Charlie Gasparino, reliable sources have informed him that more than a dozen regional banks are facing significant challenges following the collapse of First Republic Bank, as they are deemed to be “very impaired.”
Gasparino told “Fox News Tonight” host Lawrence Jones, “The big banks, I believe, the J.P. Morgans, the Bank of America, CitiGroup, Wells Fargo, they’re well-capitalized, they’re diversified and do different things, but we have a problem with regional banks. And what is the problem? The problem is we printed a ton of money, we spent a ton of money from the federal government. Those banks went out on the spectrum, as gamblers always do when you give them free money, and they invested in risky stuff. They loaded up on capital at the top of the market.”
Gasparino continued, “When you put those two things together, you have a real hole in the balance sheet of many of these regional banks. Now if you’re at a regional bank, should you be worried? I would say yes, you should be worried.”
“It’s going to be catastrophic”
Former Blackrock acc manager tells Bannon more bank failure to come in the wake of First Republic Bank, SVB, Signature bank, Credit Suisse falling.
The Biden media is fooling folks into believing everything is ok. Many will be caught off guard pic.twitter.com/99ss1DywMK— Melissa Tate (@TheRightMelissa) April 26, 2023
In a swift move, federal regulators intervened and closed down First Republic Bank during the early hours of Monday. Subsequently, the bank was sold to J.P. Morgan Chase. This action followed weeks after First Republic Bank received a substantial $30 billion injection from various lenders to prevent potential contagion following the abrupt collapses of Silicon Valley Bank and Signature Bank in March.
Charlie Gasparino attributed the crisis encountered by regional banks to Federal Reserve Chairman Jerome Powell and the Biden administration. Gasparino specifically pointed out factors such as inflation, government spending and the Federal Reserve’s decision to raise interest rates ten times since March 2022, resulting in levels not witnessed since the period preceding the 2008 financial crisis. Gasparino’s concerns align with criticisms and warnings expressed by officials from the Obama administration.
In a February 24, 2021, op-ed published in The Washington Post, Larry Summers, the former Treasury Secretary under the Clinton administration and an economic advisor to former President Barack Obama, raised concerns about the potential for inflation. Similarly, Steven Rattner, a former official in the Obama administration, expressed his apprehensions regarding the inflationary risks associated with President Biden’s spending in several op-eds throughout 2021 in The New York Times.
In response to the collapses of Silicon Valley Bank and Signature Bank, President Joe Biden expressed confidence in the state of banks on March 24, stating that they were “in pretty good shape.”
Gasparino said, “The regional banks are the least able to handle that crush. J.P. Morgan can handle it better, and that’s what you have now. Now my sources are telling me there’s about two dozen banks that are very impaired. Now whether they go under or not, I don’t know.”
