Regional bank crisis may be far from over, experts warn

By Chris Matthews

Regulators should stay vigilant as headwinds remain, say analysts

The stock-market panic over the regional banks has subsided for now, but experts say that regulators should remain focused on shoring up the stability of the sector amid economic headwinds that could persist for years to come. Shares of regional banks like PacWest Bancorp Corp. PACW, -6.46% have rebounded in the past week following news that their deposit bases had stabilized, with the SPDR S&P Regional Banking ETF gaining nearly 15% from its early March lows….A new variable for regulators to consider is the speed with which runs on Silicon Valley Bank and Signature Bank occurred, according to Karen Petrou, co-founder of the banking advisory firm Federal Financial Analytics, Inc. “The most radically new lesson of the recent crisis is the vulnerability of banks to viral runs,” she said, noting that new technology has enabled panic to spread much faster than in previous eras, carving out a new terrain for regulators to navigate….Petrou said that these new realities mean that Congress should increase deposit insurance for business transaction accounts and regulators must get serious about improving bank supervision and becoming much more assertive when they see behavior that could lead to worries about bank solvency. There were quite a lot of opportunities for regulators to step in and turn these failed banks around,” she said. “We’ve got to have much better supervision.”

https://www.marketwatch.com/story/regional-bank-crisis-may-be-far-from-over-experts-warn-2b793d95