The conversations come as Buffett has been a savior to the banking sector in the past. The chairman of Berkshire Hathaway (NYSE:BRK.B) invested $5 billion in Bank of America (BAC) in 2011 as he tried to bolster the bank due to its losses tied to subprime mortgages. In 2008, Buffett came to the aid of Goldman Sachs (GS), investing $5 billion in the bank in the depths of the financial crisis.
Regional banks may need the help of Buffett after several of the banks' stocks cratered this week, such as Western Alliance Bancorp (WAL), KeyCorp (KEY) Comerica (CMA) and Zions Bancorp (ZION), after the twin failures of Silicon Valley Bank and Signature Bank.

Credit Suisse, the battered Swiss banking giant, has agreed to a takeover by Switzerland’s largest bank, UBS — a move aimed at staving off immediate concerns of a disorderly bankruptcy and stemming panic about global financial turmoil.
UBS has agreed to buy Credit Suisse in an emergency deal that ties up two of Europe’s largest banks, Swiss authorities announced Sunday.
Swiss authorities are planning to speed up the process by circumventing laws that would require a shareholder vote, the Financial Times reported earlier Sunday. The Financial Times also reported that the value of the all-share deal was more than $2 billion, but that figure was not officially confirmed by the Swiss authorities.
A “swift and stabilizing solution was absolutely necessary,” Alain Berset, president of the Swiss Confederation, said in a Sunday afternoon news conference. The UBS deal, he said, was “the best solution for restoring the confidence that has been lacking in financial markets recently.”
In a joint statement Sunday afternoon, Treasury Secretary Janet L. Yellen and Federal Reserve Chair Jerome H. Powell said that they “welcome” the announcement.
“The capital and liquidity positions of the U.S. banking system are strong, and the U.S. financial system is resilient,” Yellen and Powell wrote. “We have been in close contact with our international counterparts to support their implementation.”
Credit Suisse and UBS did not immediately respond to requests for comment.
The takeover caps more than a week of speculation over the Swiss giant’s fate amid growing fears of a global financial crisis, after two U.S. regional banks suddenly failed earlier this month. Although U.S. regulators have taken sweeping steps, including backstopping deposits at Silicon Valley Bank and Signature Bank of New York, those measures have done little to assuage fears of a cascading banking crisis.
Those concerns went global this week, after Credit Suisse warned of “material weaknesses” in its financial reporting. On Thursday, the bank received $53.7 billion in emergency funds from Switzerland’s central bank, but it wasn’t enough to restore confidence in the bank’s viability. Shares of Credit Suisse have tumbled more than 20 percent in the past week, and more than 35 percent this year.
The past week has raised new questions on what it will take to avert another crisis. On Sunday, Sen. Elizabeth Warren (D-Mass.) called on Congress to lift the federal insurance cap for bank deposits above $250,000. She also urged lawmakers to repeal a provision of the 2018 law that had loosened restrictions on banks with $50 billion or more in assets, saying the latest tumult in the financial system underscored her belief that the Fed has fallen short on its core duties.

UBS Group AG agreed to take over its longtime rival Credit Suisse Group AG for more than $3 billion, pushed into the biggest banking deal in years by regulators eager to halt a dangerous decline in confidence in the global banking system. The deal between the twin pillars of Swiss finance is the first megamerger of systemically important global banks since the 2008 financial crisis when institutions across the banking landscape were carved up and matched with rivals, often at the behest of regulators.
The Swiss government said it would provide more than $9 billion to backstop some losses that UBS may incur by taking over Credit Suisse. The Swiss National Bank also provided more than $100 billion of liquidity to UBS to help facilitate the deal.
Swiss authorities were under pressure to make the deal happen before Asian markets opened for the week. The urgency on the part of regulators was prompted by an increasingly dire outlook at Credit Suisse, according to one of the people familiar with the matter. The bank faced as much as $10 billion in customer outflows a day last week, this person said.
The sudden collapse of Silicon Valley Bank earlier this month prompted investors globally to scour for weak spots in the financial system. Credit Suisse was already first on many lists of troubled institutions, weakened by years of self-inflicted scandals and trading losses. Swiss officials, along with regulators in the U.S., U.K. and European Union, who all oversee parts of the bank, feared it would become insolvent this week if not dealt with, and they were concerned crumbling confidence could spread to other banks.
An end to Credit Suisse’s nearly 167-year run marks one of the most significant moments in the banking world since the last financial crisis. It also represents a new global dimension of damage from a banking storm started with the sudden collapse of Silicon Valley Bank earlier this month.
Unlike Silicon Valley Bank, whose business was concentrated in a single geographic area and industry, Credit Suisse is a global player despite recent efforts to reduce its sprawl and curb riskier activities such as lending to hedge funds.
Credit Suisse had a half-trillion-dollar balance sheet and around 50,000 employees at the end of 2022, including more than 16,000 in Switzerland.
UBS has around 74,000 employees globally. It has a balance sheet roughly twice as large, at $1.1 trillion in total assets. After swallowing Credit Suisse, UBS’s balance sheet will rival Goldman Sachs Group Inc. and Deutsche Bank AG in asset size.

Company			Symbol	Uninsured deposits / 	Loans and HTM/		YTD %
domestic deposits 	total deposits		change
(higher is riskier)	(higher is riskier) 	
Bank of New York Mellon	(BK)		96.5%			31.2%		 -0.1%
SVB Financial Group	(SIVB)		93.9%			94.4%		-53.9%
State Street		(STT)		91.2%			40.1%		 -1.8%
Signature		(SBNY)		89.7%			93.3%		-39.2%
Northern Trust		(NTRS)		83.1%			54.5%		 -3.1%
Citigroup		(C)		77.0%			64.6%		  4.3%
HSBC Holdings		(HSBA)		72.5%			47.4%		 11.9%
First Republic Bank	(FRC)		67.7%			110.6%		-69.1%
East West Bancorp	(EWBC)		65.9%			91.1%		-13.9%
Comerica		(CMA)		62.5%			72.8%		-36.6% 

Financial institution	Deposits not insured by the FDIC
Signature Bank			90%
SVB				88%
Citigroup			85%
First Republic			68%
JPMorgan 			59%
BNY Mellon			56%
Citizens Financial		49%
KeyCorp				47%
PNC				46%
Truist				46%
M&T Bank			45%
Fifth Third 			42%
Bank of America			33%
Goldman Sachs			33%
Huntington Bancshares		33%

Leading Wall Street economist Nancy Lazar discusses the resilience of the U.S. economy, despite several canaries in the coal mine examples of financial strain. Lazar shares her insights on why the economy is holding up better than expected and what we can expect moving forward, including the impact of the Federal Reserve’s efforts to slow down the recovery.

How worried should the average person be about news that San Francisco’s First Republic Bank is teetering on the brink, following on the heels of Santa Clara’s Silicon Valley Bank, which imploded last week? The bigger issue is whether the bank crisis will continue to spread, and how it could ripple into the economy — for instance, by making it harder to get loans, spurring still more layoffs, and even tipping the country fully into a recession.
Most experts think that we’re still far from dire consequences, although there could be more short-term pain ahead.
“For the vast majority of people, this mini crisis is going to pass, and we’re all going to have many other things to worry about in our professional and personal lives,” said Ross Levine, a finance professor at the Haas School of Business at UC Berkeley. Still, he said, “This is a very uncertain time.”
Darrell Duffie, a Stanford finance professor, was also sanguine: “The most likely scenario is that the economy will be fine because there won’t be a major problem in the banking system,” he said. “There might be some mergers and some problems at other banks. But I think it’s most likely that after one or two more banks have had to be rescued, whether by merger or similar treatment, it will stop there.”
Why? “Because the government will do its darndest to make sure this won’t lead to significant contagion,” Duffie said. “There’s every sign the government means business. The speed and size of its actions so far are commensurate with putting a stop to this.”
Those actions included the extraordinary steps of agreeing to backstop all Silicon Valley Bank deposits, even above the insured limits, and getting 11 big banks to deposit $30 billion into First Republic to signal confidence and help keep it afloat. In addition, the Federal Reserve is ensuring that banks have plenty of funds on hand by making money available to them on “terrifically generous” terms, he said.
But not everyone was optimistic- John Lonski, former chief economist at Moody’s Investors Service and founder of the economic/market research firm Thru the Cycle, thinks that lots of smaller and regional banks could be consolidated or collapse, as happened in the savings and loan crisis, which triggered the failure of about 1,000 banks from 1986 to 1995.
He thinks cascading effects this time could include banks tightening credit — which could make it harder for people to get mortgages or credit cards, and for businesses to get loans. And that could lead to an even worse outcome.
“That credit crunch (could) finally push the U.S. economy into this long-expected recession,” he said. That would mean more layoffs, he said, particularly of middle-aged and older workers, who have higher salaries.
Anastassia Fedyk, an assistant professor of finance at Haas, weighed in midway between the upbeat and downbeat views: “We are in a contagion spiral, going from Silicon Valley Bank to First Republic,” she said. “It’s speculation at this point about how much more damage we’ll see spilling over to others.”
But, she cautioned, the domino effect could be real if investor confidence continues to sink. “We’re already on the second domino,” she said. “The regulatory responses were enough to stop some of the fallout from SVB, specifically. All those exposed deposits were protected, but not enough to quell fears that something similar might happen with similarly exposed banks like First Republic.”
Although she thinks a recession “is in the realm of feasibility,” it’s still early, and the government has a lot more tools at its disposal to stem the risk, she said.
All eyes are likely to be on the Federal Reserve next week as it meets to decide whether to continue raising interest rates to fight inflation, or press pause on its campaign, Levine said.
“They face an excruciatingly difficult decision,” he said. “They need to assess the vulnerabilities in the banking industry. If they assess there really are no systemic vulnerabilities, that this is just a few small banks, then they are likely to choose to continue with (raising rates). If they see other risks, risks they view as genuine or (that) could induce banks to restrict credit — even if the Fed views banking as very sound — then they might decide to pause the raising of interest rates.”
Duffie thinks the Fed is less likely to raise interest rates than it otherwise would have done. The banking events themselves could cause credit to tighten, thereby lowering inflation, he said. “It’s a shifting of probabilities from the Fed pushing on inflation and therefore taking a risk of recession to this brewing problem in the banking system having a similar effect on credit provision,” he said.
“Given the uncertainties, pausing for one meeting cycle could be very prudent,” Levine said. “Markets are obviously very sensitive on banks now. Waiting to tighten credit might give everything a chance to calm down.”