Asia markets UBS, Credit Suisse; China, loan prime rates

The People’s Bank of China left the loan prime rates for 1-year and 5-year unchanged, after cutting the reserve requirement ratio for just about all banks by 0.25 percentage points last week.

The 1-year LPR stayed at 3.65% while the 5-year LPR remained at 4.3%, each unchanged since August last 12 months.

The offshore Chinese yuan strengthened 0.14% to trade at 6.8795, while the onshore Chinese yuan was flat, trading at 6.885 against the U.S. dollar.

— Lim Hui Jie

The Mid-Size Bank Coalition of America has asked regulators to ensure all deposits for the subsequent two years, in line with a Bloomberg report.

The report cited a letter from MBCA, through which the coalition argued that a deposit insurance would stop rapid withdrawals from smaller banks, stabilizing the banking sector.

MBCA proposed the banks themselves would fund the expanded insurance program by increasing the deposit-insurance assessment, said the Bloomberg report.

The coalition’s request comes after U.S. Treasury secretary Janet Yellen said not all depositors shall be protected over the FDIC insurance limits of $250,000 per account, despite the FDIC securing all deposits for Silicon Valley Bank and Signature Bank.

— Yeo Boon Ping

The tech sector was one brilliant spot last week because the banking crisis rocked markets.

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— Weizhen Tan

The U.S. Federal Reserve together with five other central banks have jointly announced to extend the frequency of their U.S. dollar swap line arrangements from weekly to day by day.

The five central banks are the Bank of Canada, Bank of England, Bank of Japan, European Central Bank and Swiss National Bank.

The frequency of 7-day maturity operations will increase from weekly to day by day, starting March 20 and continuing to “at the very least” the tip of April.

In doing so, the monetary authorities said the move would “function a vital liquidity backstop to ease strains in global funding markets, thereby helping to mitigate the results of such strains on the provision of credit to households and businesses.”

The move comes ahead of the Fed’s two-day meeting this week announce its intentions on rates of interest.

— Lim Hui Jie, Jeff Cox

The chance in global EVs is huge, with the European market alone set to be price $300 billion by 2030, in line with estimates from Bernstein.

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— Zavier Ong

The FDIC announced a deal to sell “substantially all deposits and certain loan portfolios” of Signature Bank to Flagstar Bank, a subsidiary of Recent York Community Bancorp.

The agency said Signature’s 40 former branches will begin operating under Flagstar’s name on Monday.

The agreement involves $38.4 billion of Signature’s assets, including $12.9 billion of loans the FDIC said were bought at a reduction of $2.7 billion.

It said, nevertheless, Flagstar’s bid didn’t include the roughly $4 billion in deposits related to Signature’s digital banking business. The agency said it is going to provide those deposits on to digital banking customers. The FDIC also said about $60 billion in loans will remain in receivership.

— Christine Wang

UBS finalized an agreement to purchase its rival Credit Suisse for $3.2 billion. Swiss regulators played a key role in facilitating the deal in an effort to quell a contagion threatening the banking sector.

Credit Suisse saw its shares tumble last week after its largest investor, the Saudi National Bank, declined to supply additional funding. Despite subsequent measures from Credit Suisse and Swiss regulators to calm investors’ fears — including a loan of as much as 50 billion Swiss francs ($54 billion) — shares plunged 25.5% by the tip of the week.

Under the deal, Credit Suisse shareholders will receive one UBS share for each 22.48 Credit Suisse shares. The combined bank can have $5 trillion of invested assets, in line with UBS.

— Hakyung Kim

The Federal Reserve’s decision on whether to boost rates of interest by 25 basis points or implement no rate hike at next week’s policy meeting could depend upon what happens in the approaching days, said Nick Timiraos, chief economics correspondent at The Wall Street Journal.

The Fed is anticipated to approve a quarter-point, or 25 basis point, hike to rates of interest at its meeting next week. But market observers say the central bank’s next decision on rates of interest has been made less certain over the past week amid the bank crisis.

“I’m hearing the identical thing everybody else is hearing, which is that there is a case to be made for going by 25 and there is a case to be made for skipping,” he said on CNBC’s “The Exchange.” “I believe it really depends … on what happens with the state of the markets and this financial instability risk over the subsequent few days.”

— Alex Harring

First Republic Bank took one other leg lower in afternoon trading, plunging greater than 30% as investors positioned themselves in the ultimate hour of trading this week. Friday’s nosedive has brought the stock down greater than 70% from where it began the week.

The drop has also weighed on the SPDR S&P Regional Banking ETF (KRE), which was down 6% on Friday and poised for a weekly lack of greater than 14%.