Blackrock boss Larry Fink: SVB collapse may signal ‘dominoes are starting to fall’

City AM (via MSN):

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The collapse of Silicon Valley Bank could signal the “dominoes are starting to fall” after an abrupt end to the era of low interest rates and cheap money, the boss of the world’s biggest asset manager BlackRock has warned.

In his annual letter to investors today, Larry Fink said a series of aggressive rate hikes to tame rampant inflation in the past year had “exposed cracks in the financial system” and “something else had to give”.

The global banking sector has been plunged into crisis in the past week after Silicon Valley Bank and two smaller regional lenders failed, prompting jitters across markets and a sell-off in banking stocks.

Credit Suisse is the latest lender to appear to be on shaky ground today, after shares in the firm plunged more than 20 per cent in morning trading.

Fink said SVB’s failure had been down to a “classic asset-liability mismatch” and may be a harbinger of things to come.



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