According to an April survey, public opinion of banks appears to be diminishing as the industry battles to contain the collapse of numerous high-profile financial organizations in recent months.
A Gallup poll conducted in April across the United States with at least a thousand respondents reported that 48% were anxious about their money in the bank, with over 20% indicating they were “very concerned.”
However, it should be noted that the poll was conducted after the failures of Silicon Valley Bank and Signature Bank, but before the failure of First Republic Bank in late April. Gallup stated that the level of concern was comparable to that recorded during the previous bank-induced financial crisis in 2008, “when financial institutions previously believed to be “too big to fail” collapsed.”
“The most recent readings are comparable to those from 2008.” In September of that year, just after the failure of Lehman Brothers, the largest bankruptcy filing in US history.”
Meanwhile, specialists at the Hoover Institution believe that if half of the uninsured savers withdrew all of their money, 186 American banks would face a “potential risk of impairment.”
These banks have total assets of $300 billion, however, they account for less than 5% of the estimated 4,135 FDIC-insured commercial banks in the United States.
Furthermore, rumors indicate that California-based PacWest, Arizona-based Western Alliance, and Memphis-based First Horizon Banks are in jeopardy following a share price drop last week.
Earlier this month, the UK’s Telegraph published a more scathing report, claiming that half of America’s banks may be insolvent. It referenced research published in April by Stanford University banking specialist Professor Amit Seru, who estimated that over 2,315 US banks have assets worth less than their liabilities.
“The market value of assets in the United States banking system is $2.2 trillion lower than suggested by their book value of assets accounting for loan portfolios held to maturity,” he stated.