Bear Stearns has had to take out emergency funding, sparking fears that major Wall Street banks are suffering considerably from the credit crunch.
In the UK, a similar move by Northern Rock led to a bank run, which left the bank so indebted to the state that the Government was forced to nationalise it. Bear Stearns is known to have used funding from JP Morgan Chase, which will be available for up to 28 days, to provide the bank with liquidity. It said it is in talks with JP Morgan Chase to secure more permanent financing facilities. The news sent Bear Stearns' share price down 58% on the news, hitting a low of $28 per share. Alan Schwartz, CEO of Bear Stearns Companies Inc, comments: "Bear Stearns has been the subject of a multitu...
To continue reading this article...
Join Professional Adviser for free
Signup and gain exclusive members-only insights
- Unlimited access to real-time news, industry insights and market intelligence
- Stay ahead of the curve with spotlights on emerging trends and technologies
- Receive breaking news stories straight to your inbox in the daily newsletters
- Make smart business decisions with the latest developments in regulation, investing retirement and protection
- Members-only access to the editor’s weekly Friday commentary
- Be the first to hear about our events and awards programmes
