SVB deal boosts stocks

BANKING stocks rallied yesterday after parts of collapsed Silicon Valley Bank were snapped up by a US regional lender.

The deal involving North Carolina-based First Citizens eased worries about the wider sector, which is experiencing the biggest shock since the 2008 financial crisis.

Reports that US authorities were considering more support for embattled lenders also lifted investor appetite after weeks of turmoil.

The collapse of SVB and two smaller American lenders had set off global tremors resulting in the demise of 167-year- old Credit Suisse.

SVB’s UK arm has already been rescued in an emergency £1 takeover by HSBC.

Concerns have also spread to US regional banks and in particular First Republic. Its shares rose 10.5pc yesterday however, while other regional lenders such as Keycorp and Zions also posted gains, as did bigger names such as JP Morgan and Citigroup. First Citizens soared 22pc.

In Europe, Deutsche Bank – which fell 8.5pc on Friday as fears over the European banking sector spread – climbed 6pc yesterday. UK banks were also on the front foot with Barclays up 2.3pc, NatWest ahead by 0.5pc, HSBC rising 1.3pc and Lloyds climbing 1.3pc.

The deal for SVB sees First Citizens take on assets of £90bn, deposits of £46bn and a loan book of £59bn as well as its 17 branches.

SVB was taken over by the Federal Deposit Insurance Corporation (FDIC) earlier this month after a bank run which saw billions of dollars pulled out by depositors.