Paul Morigi
Billionaire investor Warren Buffett has been in touch with senior Biden administration officials in recent days about the regional banking crisis.
There were several conversations between Biden officials and Buffett over the past week, according to youo Bloomberg report Saturday, which quoted people familiar. The talks revolve around which billionaire could invest in the U.S. regional banking sector, though Buffett also gave his views on the sector’s current turmoil.
The conversations come as Buffett has been a savior of the banking industry in the past. Chairman of Berkshire Hathaway (NYSE: BRK.B) invested $5 billion in Bank of America (BAC) in 2011 as it tried to bolster the bank due to its subprime mortgage losses. In 2008, Buffett came to the aid of Goldman Sachs (GS), investing $5 billion in the bank at the height of the financial crisis.
Regional banks may need Buffett’s help after several bank stocks fell this week, such as Western Alliance Bancorp (WAL), KeyCorp (KEY) Comerica (CMA) and Zions Bancorp (ZION), after the double check of Silicon Valley Bank and Signature Bank.
A group representing midsize US banks has sent a letter to the FDIC asking the agency to insure all bank deposits for the next two years, according to a separate Bloomberg report.
First Republic Bank (FRC) shares slipped 15% after-hours trading on Friday after a media report that the troubled lender is in talks to raise capital from other banks or private equity firms through the issuance of new shares.
