Buffett: Do not panic about U.S. banking industry

(Reuters) – Warren Buffett on Wednesday said people should not be panicked about the banking industry or the safety of U.S. bank deposits, despite the recent failures of Silicon Valley Bank and Signature Bank.

Speaking on CNBC television, the billionaire chairman of Berkshire Hathaway Inc said recent banking problems do not resemble the problems that helped trigger the 2008 global financial crisis.

Buffett said some banks have “mismanaged” their assets and liabilities, and that banks board of directors should ensure there are consequences when top executives make mistakes that hurt shareholders.

People “do not need to be panicked” about the banking industry and “shouldnt be worried about deposits they have in an American bank,” though that message has recently gotten “confused” and “mixed up,” Buffett said.

Buffett also said he would bet $1 million that no American depositor would lose money from a bank failure, with the person on the losing side of that bet donating the money to charity.

The Federal Deposit Insurance Corp insures deposits for up to at least $250,000 per depositor per FDIC-insured bank.

Buffett was speaking from Japan, where he was visiting five large Japanese trading houses in which Berkshire has investments.

Berkshire invests in several banks, including a stake in Bank of America Corp worth $34.2 billion as of the end of 2022.

(Reporting by Jonathan Stempel in New York; editing by Jason Neely)