Headline
Four Days That Shook The US Banking System

The United States banking system has been gripped in recent days by a series of convulsions that has seen the collapse of three banks and authorities undertaking extraordinary measures to reassure depositors.
It all began Wednesday night with a liquidation announcement from the small regional Silvergate Bank, a favourite among the cryptocurrency crowd.
The California business was swept up in several crypto mishaps, particularly the implosion of exchange platform FTX, before facing a wave of sudden withdrawals.
Later that same night, medium-sized institution Silicon Valley Bank announced it was facing a huge run of unexpected withdrawals.
SVB, a key lender to start-ups across the United States since the 1980s and the country’s 16th-largest bank by assets, had been hit by the tech sector slowdown as cash-hungry companies rushed to get their hands on their money.
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SVB — along with other banks — was also dealing with the effects of the Federal Reserve’s policy U-turn as the US central bank has moved aggressively over the last year to counter inflation by hiking interest rates.
Banks typically borrow money under short-term instruments while loaning using long-term vehicles.
Ordinarily, this dynamic is beneficial because interest rates on long-term instruments are higher than those on short-term bonds.
But because of the volatility unleashed by the Fed’s policy pivot, there has been an “inversion” of the bond yield curve.
– Run on deposits –
The extent of SVB’s trouble emerged in a presentation last Wednesday.
While the bank emphasized the strength of its balance sheet and the relatively low proportion of its loans compared to its deposits, it also announced a capital increase of $2.25 billion and revealed that after an emergency sale of a portfolio of financial securities worth $21 billion it still came out with a loss of $1.8 billion.
The announcement spooked investors and clients, and sparked a run on deposits.
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On Thursday alone, the SVB saw an estimated $42 billion of withdrawal orders.
It was not able to honour all those requests, and posted a negative cash position of nearly $1 billion by the end of the day.
On the stock market, the SVB tanked by 60 per cent.
Trading was halted on Friday before the Federal Deposit Insurance Corporation (FDIC) took over the bank and said it would protect insured deposits — those up to $250,000 per client.
But the FDIC’s guarantee only covered about four percent of the bank’s deposits, with most accounts well over that limit and clients left uncertain as to whether they would be able to recover their money in full.
The biggest US banks are considered stable, in part because of strict requirements enacted after the 2008 financial crisis.
But other mid-sized and regional institutions have been pressured by worries of a similar run on deposits to that suffered by SVB.
Shares in the New York Signature Bank, California PacWest and the Arizona-based Western Alliance all dropped 20 percent on the day.
– Averting panic –
With SVB’s future, and billions in deposits up in the air, officials from the Fed, the FDIC and the Treasury raced to craft a solution, hoping to avert a potential financial panic before financial markets opened in Asia.
To stop one bank’s failure from spreading into a systemic banking crisis, the three federal agencies announced on Sunday that SVB depositors would have access to “all of their money” starting Monday, March 13, and that American taxpayers will not have to foot the bill.
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The same statement revealed that Signature Bank, the 21st-largest in the country, was automatically closed on Sunday and that its customers would benefit from the same measures as those at Silicon Valley Bank.
In a potentially major development, the Fed announced it would make extra funding available to banks to help them meet the needs of depositors, which would include withdrawals.
On Monday, President Joe Biden praised the “immediate action” by regulators while trying to offer reassurances.
“The bottom line is this: Americans can rest assured that our banking system is safe. Your deposits are safe,” Biden said.
AFP
Headline
South Korea, Japan Protest China, Russia Aircraft Incursions
South Korea and Japan reacted furiously on Wednesday after Chinese and Russian military aircraft conducted joint patrols around the two countries, with both Seoul and Tokyo scrambling jets.
South Korea said it had protested with representatives of China and Russia, while Japan said it had conveyed its “serious concerns” over national security.
According to Tokyo, two Russian Tu-95 nuclear-capable bombers on Tuesday flew from the Sea of Japan to rendezvous with two Chinese H-6 bombers in the East China Sea, then conducted a joint flight around the country.
The incident comes as Japan is locked in a dispute with China over comments Prime Minister Sanae Takaichi made about Taiwan.
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The bombers’ joint flights were “clearly intended as a show of force against our nation, Defence Minister Shinjiro Koizumi wrote on X Wednesday.
Top government spokesman Minoru Kihara said that Tokyo had “conveyed to both China and Russia our serious concerns over our national security through diplomatic channels”.
Seoul said Tuesday the Russian and Chinese warplanes entered its air defence zone and that a complaint had been lodged with the defence attaches of both countries in the South Korean capital.
“Our military will continue to respond actively to the activities of neighbouring countries’ aircraft within the KADIZ in compliance with international law,” said Lee Kwang-suk, director general of the International Policy Bureau at Seoul’s defence ministry, referring to the Korea Air Defence Identification Zone.
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South Korea also said it deployed “fighter jets to take tactical measures in preparation for any contingencies” in response to the Chinese and Russian incursion into the KADIZ.
The planes were spotted before they entered the air defence identification zone, defined as a broader area in which countries police aircraft for security reasons but which does not constitute their airspace.
Japan’s defence ministry also scrambled fighter jets to intercept the warplanes.
Beijing later Tuesday confirmed it had organised drills with Russia’s military according to “annual cooperation plans”.
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Moscow also described it as a routine exercise, saying it lasted eight hours and that some foreign fighter jets followed the Russian and Chinese aircraft.
Since 2019, China and Russia have regularly flown military aircraft into South Korea’s air defence zone without prior notice, citing joint exercises.
In November last year, Seoul scrambled jets as five Chinese and six Russian military planes flew through its air defence zone.
Similar incidents occurred in June and December 2023, and in May and November 2022.
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Meanwhile, Tokyo said Monday it had scrambled jets in response to repeated takeoff and landing exercises involving fighter jets and military helicopters from China’s Liaoning aircraft carrier as it cruised in international waters near Japan.
It also summoned Beijing’s ambassador after military aircraft from the Liaoning locked radar onto Japanese jets, the latest incident in the row ignited by Takaichi’s comments backing Taiwan.
Takaichi suggested last month that Japan would intervene militarily in any Chinese attack on the self-ruled island, which Beijing claims as its own and has not ruled out seizing by force.
AFP
Headline
Thousands Reported To Have Fled DR Congo Fighting As M23 Closes On Key City
Fierce fighting rocked the eastern Democratic Republic of Congo on Tuesday as the Rwanda-backed M23 militia rapidly advanced towards the strategic city of Uvira, with tens of thousands of people fleeing over the nearby border into Burundi, sources said.
The armed group and its Rwandan allies were just a few kilometres (miles) north of Uvira, security and military sources told AFP.
The renewed violence undermined a peace agreement brokered by US President Donald Trump that Kinshasa and Kigali signed less than a week ago, on December 4.
Trump had boasted that the Rwanda-DRC conflict was one of eight he has ended since returning to power in America in January.
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With the new fighting, more than 30,000 people have fled the area around Uvira for Burundi in the space of a week, a UN source and a Burundian administrative source told AFP.
The Burundian source told AFP on condition of anonymity he had recorded more than 8,000 daily arrivals over the past two days, and 30,000 arrivals in one week. A source in the UN refugee agency confirmed the figure.
The Rwanda-backed M23 offensive comes nearly a year after the group seized control of Goma and Bukavu, the two largest cities in eastern DRC, a strategic region rich in natural resources and plagued by conflict for 30 years.
Local people described a state of growing panic as bombardments struck the hills above Uvira, a city of several hundred thousand residents.
“Three bombs have just exploded in the hills. It’s every man for himself,” said one resident reached by telephone.
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“We are all under the beds in Uvira — that’s the reality,” another resident said, while a representative of civil society who would not give their name described fighting on the city’s outskirts.
Fighting was also reported in Runingo, another small locality some 20 kilometres (12 miles) from Uvira, as the M23 and the Rwandan army closed in.
Burundi views the prospect of Uvira falling to Rwanda-backed forces as an existential threat, given that it sits across Lake Tanganyika from Burundi’s economic capital Bujumbura.
The city is the main sizeable locality in the area yet to fall to the M23 and its capture would essentially cut off the zone from DRC control.
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Burundi deployed about 10,000 soldiers to eastern DRC in October 2023 as part of a military cooperation agreement, and security sources say reinforcements have since taken that presence to around 18,000 men.
The M23 and Rwandan forces launched their Uvira offensive on December 1.
Rich in natural resources, eastern DRC has been choked by successive conflicts for around three decades.
Violence in the region intensified early this year when M23 fighters seized the key eastern city of Goma in January, followed by Bukavu, capital of South Kivu province, a few weeks later.
– Regional risk –
The peace deal meant to quell the fighting was signed last Thursday in Washington by Congolese President Felix Tshisekedi and his Rwandan counterpart Paul Kagame, with Trump — who called it a “miracle” deal — also putting his signature to it.
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The agreement includes an economic component intended to secure US supplies of critical minerals present in the region, as America seeks to challenge China’s dominance in the sector.
But even on the day of the signing, intense fighting took place in South Kivu, where Uvira is located, which included the bombing of houses and schools.
Witnesses and military sources in Uvira said that Congolese soldiers fleeing the fighting had arrived in the city overnight Monday and shops were looted at dawn.
Several hundred Congolese and Burundian soldiers had already fled to Burundi on Monday, according to military sources, since the M23 fighters embarked on their latest offensive from Kamanyola, some 70 kilometres north of Uvira.
Since the M23’s lightning offensive early this year, the front had largely stabilised over the past nine months.
Burundian President Evariste Ndayishimiye warned in February there was a danger of the conflict escalating into a broader regional war, a fear echoed by the United Nations.
Headline
‘Santa Claus’ Arrested For Possessing, Distributing Child Sexual Abuse Material
A 64-year-old man from Hamilton Township has been arrested in the United States after investigators linked him to the possession and distribution of child sexual abuse material.
The suspect, identified as Mark Paulino, had been working as a “Santa for hire” at holiday events, a role that placed him in repeated contact with children.
Mercer County officials said the investigation began on 4 December when detectives were alerted to suspicious online activity involving the uploading of child pornography from a residence in Hamilton Township. The probe quickly identified Paulino, a retired elementary school teacher, as the person involved.
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Police stated that Paulino had presented himself online as a retired teacher and had recently performed as Santa Claus for photographs and private, corporate, and organisational events. “Because this role involved direct, repeated contact with children, detectives worked around the clock to secure a search warrant,” authorities explained.
The warrant was executed on 5 December, during which police seized multiple items regarded as evidentiary. Paulino was taken into custody without incident and charged with possession and distribution of child sexual abuse materials, as well as endangering the welfare of a child.
Prosecutors have filed a motion to detain him pending trial. The investigation remains ongoing, and authorities have urged members of the public with relevant information to come forward.
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