• According to a recent Gallup poll, 48% of Americans are concerned about the safety of their money deposited with banks.
• Experts at the Hoover Institution think tank postulate that if half of all uninsured savers withdrew all of their cash, 186 American banks would be at “potential risk of impairment.”
• A report from The Telegraph suggests that half of the banks in America could be insolvent.
Concern Over Banking Crisis Reaches Unseen Levels Since 2008
Public opinion of banks appears to be dwindling according to an April survey, as the industry struggles to contain the collapse of several high-profile financial institutions in recent months. A Gallup poll conducted across the United States in April revealed that 48% of respondents said that they were concerned about their money in the bank, with almost 20% who indicated they were “very concerned.” Republicans, lower-income adults and those without a college degree are more worried than their counterparts about the safety of their money in banks or other financial institutions.
Banks At Potential Risk Of Impairment
Experts at the Hoover Institution think tank postulate that if half of all uninsured savers withdrew all of their cash, 186 American banks would be at “potential risk of impairment.” These banks have total assets of $300 billion but represent less than 5% of estimated 4,135 FDIC (Federal Deposit Insurance Corporation) insured commercial banks in the United States. Furthermore, reports suggest California-based PacWest, Arizona’s Western Alliance and Memphis-based First Horizon hang in the balance following a share price slump last week.
Half Of All Banks In America Could Be Insolvent
A more damning report emerged from UK’s Telegraph earlier this month which suggested that half of all banks in America could be insolvent. The research published by Stanford University banking expert Amit Seru estimates that more than 1/3rd large US lenders may not have enough capital on hand to cover potential losses from loan defaults as economic crisis deepens due to COVID-19 pandemic.
Level Of Worry On Par With Financial Crisis In 2008
Gallup concluded that level worry was on par with measured during last bank-induced financial crisis in 2008 when financial institutions previously believed to be too big to fail collapsed soon after Lehman Brothers went bankrupt; largest bankruptcy filing ever in US history.
Conclusion
The recent poll and reports clearly indicate a concerning trend amongst Americans regarding banking crisis and how it might affect them financially given current situation amidst COVID pandemic and downfall witnessed by several high-profile financial institutions recently; emphasizing importance for people to stay up-to-date about latest news related to banking sector before making any decisions related to finances during these difficult times ahead for entire economy globally