‘We’re In Deep Doo Doo’: Charlie Gasparino Says ‘More Banks Will Fail’

Fox Business Senior Correspondent Charlie Gasparino gave a dire assessment of recent regional banking troubles that he says will get worse.

This week, federal regulators seized First Republic Bank and facilitated an acquisition of the distressed company to JPMorgan. It was the most recent collapse in a string of high-profile financial institutions. Earlier this year, Silicon Valley Bank and Signature Bank also failed. If investor sentiment is any indication, two other banks – PacWest Bancorp and Western Alliance Bancorp – may be headed for the same fate. The companies’ share prices declined 51% and 38% on Thursday, respectively.

Gasparino appeared on Thursday’s edition of The Story on Fox News, where Martha MacCallum asked him about the crisis.

“How should we read what’s going on today with these banks?” she asked.

“We’re in deep doo doo, I’m afraid,” he replied.

“That a technical measure?” she joked.

“That’s an economic term for you know, something I can’t say on air,” Gasparino responded. “You have three banks. Each one of these banks that failed were considered one-offs. There’s no such thing as one-offs. There’s no such thing as three-offs. The same sort of stuff, risk-taking that those three banks took – Signature, Silicon Valley, and First Republic – is duplicated throughout the banking system, particularly in the mid-size banks, the regional banking system.”

He explained that sources told him “about two dozen banks have similar balance sheets” with money-losing assets.

“Some of those assets are loans, some of them are commercial loans,” he continued. “Commercial real estate isn’t doing too well. The other is the capital that they keep as assets, which are underwater because they bought it at the height of the market before the [Federal Reserve] started tightening interest rates. So, this is a real problem. Now, how do you get out of it – is difficult. More banks will fail. I don’t know if Pacific West is gonna fail, but it’s now a penny stock.”

Gasparino said some banks will continue to face a liquidity crisis as depositors withdraw their money to seek higher savings rates elsewhere, such as short-term money market funds.

Watch above via Fox News.

Have a tip we should know? [email protected]