Despite statements from the US president claiming that the country’s financial system is secure, bank shares fell on Monday all across the world.
That comes following the failure of American lenders Silicon Valley Bank (SVB) and Signature Bank, which required government intervention to save consumer deposits.
Joseph Biden pledged to take “everything is necessary” to safeguard the financial system.
Investors worry that the impact could yet affect other lenders and cause severe declines in share values throughout the globe.
Earlier on Monday, Spain’s Santander and Germany’s Commerzbank saw their share prices plummet by more than 10% at one point.
Some smaller US banks saw even greater losses on Monday than their European counterparts, despite telling their clients that they had more than adequate liquidity to guard against shocks.
Because of the volatility, there is speculation that the Federal Reserve of the United States will now postpone its plans to maintain raising interest rates in an effort to control inflation.