Warren Buffett, chairman and CEO of Berkshire Hathaway, known as the "Oracle of Investment," was recently reported to have contacted senior administration officials regarding the U.S. regional bank crisis. It is also known that they discussed options for investing in regional banks.
Bloomberg News reported on the 19th (local time), citing anonymous sources, that Buffett met with senior officials last week to discuss the recent regional bank crisis. The sources said both sides discussed the possibility of Buffett investing in U.S. regional banks, and Buffett also provided advice on the current crisis situation.
This comes amid ongoing concerns about risks to the banking system following the bankruptcies of Silicon Valley Bank (SVB) and Signature Bank. Despite special measures by U.S. authorities allowing full deposit withdrawals regardless of insurance limits, anxiety remains that the crisis could spread further. Bloomberg estimates that the market value of banks worldwide has plummeted by more than $500 billion (approximately 654.75 trillion KRW) since the SVB incident.
Buffett has previously acted as a savior during banking crises. In 2008, when Goldman Sachs’ stock price plummeted due to the Lehman Brothers bankruptcy, he invested $5 billion to help raise capital. In 2011, amid the fallout from the subprime mortgage crisis when Bank of America’s (BoA) stock price collapsed, he also invested $5 billion.
Bloomberg reported, "As the Biden administration struggles to overcome the banking crisis without injecting taxpayer money, investments or interventions by individuals like Buffett could help prevent the crisis from spreading without direct bailouts."
On social media and other platforms, posts have surfaced claiming that private jets of bank CEOs landed in Omaha last weekend, where Buffett is staying. This has led to speculation that Buffett may step into investing in small and medium-sized banks.
However, Buffett has not escaped the aftershocks of the SVB fallout. Wall Street investment publication Investors Business Daily (IBD) reported that an analysis of data from S&P Global Market Intelligence and MarketSmith showed Berkshire Hathaway suffered losses of $12.6 billion (approximately 16 trillion KRW) this year across 15 U.S.-listed stocks it holds. IBD noted that Buffett, who has traditionally focused his investments on financial stocks, appears to be paying the price for this approach due to the SVB crisis.
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