IMF Warns of Uneven Recovery as Global GDP to Shrink 4.4%


IMF warns: banks may suffer losses for another 5 years

  • IMF warned that bank profits could decline until 2025.

  • In 2020, shares of the US banking sector sank noticeably.

  • Bitcoin is showing relative resilience against this backdrop, offering a possible alternative to investors.

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According to experts from the International Monetary Fund (IMF), problems in the traditional banking sector may persist until 2025.

Banks face a bleak future

This Friday, the International Monetary Fund (IMF) released a report that complements the Global Financial Stability Report published earlier in April..

IMF warns: banks may suffer losses for another 5 years

According to the latest estimates from the Foundation’s experts, the global economic downturn triggered by the COVID-19 pandemic has painfully affected the financial sector. As a consequence, bank profits may continue to be in the red until 2025.

In addition, the IMF draws attention to the fact that bank profits began to decline even before the appearance of the coronavirus..

IMF warns: banks may suffer losses for another 5 years

Last year, BeInCrypto’s editors also talked about problems in the banking sector – for example, a massive decrease in deposit rates, forcing citizens to look for more attractive ways to save and invest..

“Beyond the immediate challenges posed by the COVID-19 outbreak, bank profits could remain under pressure in the coming years due to a prolonged period of low interest rates – even as the economy begins to recover from the current shock,” the report said..

Many stocks in the US banking sector have been in the red since the beginning of this year. So, for example, JPMorgan profits for the 1st quarter of this year fell 69%.

IMF warns: banks may suffer losses for another 5 years

Such dismal performance has already forced Berkshire Hathaway, the brainchild of renowned investor Warren Buffett, to start actively dumping shares and dumping its stakes in leading US banks..

Time to change priorities?

Meanwhile, the bitcoin (BTC) rate looks quite advantageous and stable against this background. What is noteworthy, recently some analysts have started talking about the fact that the first cryptocurrency in the world began to lose correlation with the stock market and play its own game..

IMF warns: banks may suffer losses for another 5 years

The continuation of this trend and further drawdown in the banking industry may cause a redistribution of investment flows in favor of Bitcoin and other cryptocurrencies..

Perhaps the banks themselves are beginning to see a competitor in bitcoin. It is no coincidence that some of them decide to try themselves in a new role as custodian services providers in the digital asset segment, while others resort to the opposite strategy and conduct campaigning campaigns against cryptocurrencies among their clients. Crypto enthusiasts believe they are driven by an obvious fear of losing customers.

Do you believe that the problems in the traditional banking sector will prompt investors to turn their attention to an alternative such as cryptocurrencies? Share your opinion in the comments and join discussions in our Telegram channel!


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