The banking sector turmoil that led to the collapse of several lenders was not a systemic crisis and has now subsided, according to IIF CEO Tim Adams.
"We have over 4,000 banks in the United States, we have about 10,000 banks globally that are part of SWIFT and 35,000 financial institutions around the world — 99.999% of them opened their doors over the past month and had no problems whatsoever — [it's] really just a few isolated idiosyncratic institutions," Adams told CNBC's Joumanna Bercetche.
"So I think it is not a crisis, I think it was market turbulence, it has subsided, it has stabilized, but we need to be vigilant and we need to watch for other stresses in the system." The IIF is a global trade body for the financial services industry, with around 400 members in more than 60 countries. Adams said the primary concern among members was the downside risk to growth, particularly in advanced economies.
The IMF on Tuesday lowered its five-year global growth forecast to around 3%, marking the lowest medium-term forecast in an IMF World Economic Outlook report since 1990. The D.C.-based institution's Chief Economist Pierre-Olivier Gourinchas told CNBC on Tuesday that the turmoil in the banking sector had weakened the growth outlook, especially in the face of rapid monetary policy tightening from central banks that have sharply increased lenders' funding costs and increased vulnerabilities.
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