Saturday 03 Jun 2023
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LONDON (March 22): The banking turmoil sparked by the collapse of Silicon Valley Bank is not yet over, and a significant number of banks will fail within two years, the CEO of hedge fund Man Group, Luke Ellis, told a Bloomberg conference in London on Wednesday (March 22).

Asked whether the crisis in the sector was over, Ellis told delegates at the event he did not think so.

Market chaos forced the emergency rescue of Credit Suisse by its Swiss rival UBS over the weekend, in a move that has brought some calm to markets.

"I think we will have significantly more banks that don’t exist in 12-24 months," he said, adding that he thought smaller and regional banks in the US and challenger banks in Britain could be at risk.

Ellis said technology such as social media had accelerated the timescale at which concerns about banks could circulate. "Things happen at a much faster speed. Whether that's a crisis or it's good news," he said.

Many hedge funds have made money from the volatility in the banking sector in recent days by betting against banks, although Ellis said he had no positions in US regional banks.

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