Banking: Back in the News

The challenges in banks' portfolios will work out over time.

I am great with faces, but I am terrible with names. Once I see someone, I have near-total recall of past interactions: details about their firms and their families return quickly to mind. But the most critical field in my mental address book is often blank.

On one occasion last year, I referred to Mike, the leader of one of our offices, as “Joe” throughout a client meeting. There were confused looks around the table, which isn’t atypical when I am presenting. When the misnomer was pointed out afterwards, I was terribly embarrassed.

It is a blessing that our recollections of unpleasant experiences eventually fade. That is the point we had reached with the banking crisis of 2023, whose anniversary is approaching. But recent weeks have brought that episode forward in our consciousness. The names have changed, but some of the details are familiar.

Late winter and early spring of last year were difficult times for the banking industry. The failure of Silicon Valley Bank (SVB) and two others sent shivers through markets. That unfortunate episode had receded into memory, until recent news surrounding New York Community Bank (NYCB) reinstated concerns about the financial sector.

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