PARIS (Reuters) – The European banking stock market sector is heading down sharply on Monday morning for the second consecutive session, still affected by the setbacks of SVB Financial Group despite the measures announced by the authorities to limit the impact of this collapse.

Around 09:30 GMT, the Stoxx 600 index of banks plunged 5.48%, to a low of more than seven weeks, after having already lost 3.8% on Friday. It shows the largest sector decline, with Commerzbank (-11.92%) leading the declines.

Credit Suisse (-9.09%), Banco BPM (-7.09%), Virgin Money (-7.14%), Danske Bank (-4.5%), Intesa Sanpaolo (-5.46%) appear also among the largest declines in the sector.

In Paris, BNP Paribas yields 4.13%, Société Générale 4.11% and Crédit Agricole 3.68%.

Faced with the threat of a withdrawal of customer deposits, the US Federal Reserve (Fed) has undertaken to make funds available, via a new bank financing program, for institutions that need it.

In France, the Minister of Finance Bruno Le Maire assured that there was no “specific alert” on the sector in France, while the United Kingdom said it wanted to “avoid the damage” linked to the fall of SVB Financial Group which operates under the name of Silicon Valley Bank (SVB).

Trapped by the accelerated rise in interest rates in the United States, SBV collapsed on the stock market last week after a surprise capital increase intended to make up for a loss of 1.8 billion dollars, following the sale of a bond portfolio.

According to Citigroup analysts, the problems facing SVB represent a very limited risk for European banks.

“European banks have less concentration of deposits, still record relatively healthy deposit flows, operate with large liquidity portfolios and remain well capitalized,” writes Citigroup.

(Written by Claude Chendjou, with Tristan Chabba, edited by Blandine Hénault)

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