IMF chief says rising rates exposed banking vulnerabilities
1 min read 01 May 2023, 10:10 PM ISTIndustry leaders need to ‘anticipate shocks and be ready to act when they occur, because they will be coming,’ Kristalina Georgieva said
PremiumThe International Monetary Fund’s chief said the rapid acceleration in interest rates “exposed vulnerabilities in the financial sector," adding that the banking industry needs to be on watch for additional risks.
Industry leaders need to “anticipate shocks and be ready to act when they occur, because they will be coming," Kristalina Georgieva said in an interview with Stephanie Flanders, the head of economics and government at Bloomberg News, at the Milken Institute Global Conference in Beverly Hills, California.
“What we have lived through in the last years has been a series of unthinkable events," Georgieva said. “The pandemic, the war in Ukraine, the rapid jump of interest rates after many, many years of staying low."
Georgieva’s comments Monday come as US regulators continue efforts to shore up the banking sector, which has been rattled by the Federal Reserve’s aggressive interest-rate hikes and accelerating depositor withdrawals.
First Republic Bank became the fourth regional lender to collapse since since turmoil kicked off in March, with the Federal Deposit Insurance Corp. over the weekend orchestrating its sale to JPMorgan Chase & Co.
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