The sudden failure of two big banks has people watching and wondering if they should be concerned about the money in their own bank accounts.

Dr. Greg Filbeck, Director of the Black School of Business at Penn State Behrend and a professor of finance and risk management told Erie News Now that he views the failure of Silicon Valley Bank and the subsequent fall of Signature Bank as specific to those banks because of poor risk management and response to rising interest rates.  

He doesn't anticipate so called "contagion" to other financial institutions. "No, I don't think individuals need to be concerned about it. I think the administration responded appropriately to allay those fears and to be able to put safeguards in place to keep not only the bank system sound but also to allay fears of potential contagion effects from depositors who are worried." Filbeck said.  "You've go one bank in Silicon Valley that's been involved in venture capital, you have a second bank now that is very heavy in crypto so these are not necessarily the type of assets that you see associated with a typical bank."

Still, Monday was a jittery day on Wall Street for stocks in mid-sized banking institutions. Stocks in local and regional banks were down, following the trend across the market.  That includes PNC Financial, closing down 7.11 and CNB Financial Corp the holding company for Erie Bank, down 2.33.

Dr. Filbeck said contagion can be psychological, fueled by fear and internet chatter that isn't based in data, but it can be real too if a bank that fails has direct ties to other financial institutions.  We asked if he thinks any more banks will fail before this crisis is over. "I mean that would of course take a crystal ball to be able to answer that question conclusively, but I see no reason for continued contagion. Obviously I think that there will a very diligent watch on banks that may appear vulnerable particularly in the short run, but there's no reason to believe this will cause a continuation of concerns."

In response to the crisis, regulators guaranteed all deposits at the two banks. They also created a program that effectively provides a lifeline to other banks to shield them from any run on deposits.