Life is getting tough for borrowers. Where will the pain be felt?

Ramifications from the fall of Silicon Valley Bank

NEW YORK, NEW YORK - MARCH 16: People walk past the New York Stock Exchange (NYSE) on March 16, 2023 in New York City. Stocks fell again in morning trading as investors continue to show concerns over the stability of global banks following the collapse last week of Silicon Valley Bank. (Photo by Spencer Platt/Getty Images) — Image: Getty Images

Apr 11th 2023

After american regulators seized control of a collapsing Silicon Valley Bank (svb), the fallout felt unpleasantly familiar. The biggest bank failure since 2008 was swiftly followed by others. Signature Bank fell two days later. Another week and fleeing investors had forced Credit Suisse, a 167-year-old Swiss bank, into a hasty tie-up with its rival ubs. Fifteen years ago a cascade of such failures prompted a global credit crunch, as financial institutions drastically tightened lending standards in an attempt to protect themselves, which was followed by the worst downturn in generations. Was a repeat under way?

This article appeared in the Finance & economics section of the print edition under the headline “The big squeeze”