© 2024 Kansas City Public Radio
NPR in Kansas City
Play Live Radio
Next Up:
0:00 0:00
Available On Air Stations

How the collapse of 2 financial institutions caused a Kansas City bank's stock to fall

Ways To Subscribe
$100 bills lay scattered atop one another.
Giorgio Trovato

Earlier this week, Silicon Valley Bank in California and Signature Bank in New York collapsed, prompting the Federal Deposit Insurance Corporation to take them into receivership. Then, it caused the stock of UMB Bank in Kansas City to drop.

Following the collapses of Silicon Valley Bank and Signature Bank that had the U.S. financial system on high alert, a Kansas City bank's stock plunged on Monday.

UMB Bank, which has the largest customer base of any bank in the Kansas City area, saw its stock price fall nearly 30% that morning. While it rebounded to about 15% just before the markets closed, as of Wednesday it hasn't come close to its previous price.

Finance professor Bill Keeton, of the University of Missouri-Kansas City, says UMB Bank was a victim of what economists call "contagion"; when the financial issues of one bank cause investors and uninsured depositors at another to worry.

"(UMB) also had a pretty high percent of uninsured deposits, though not as high as Silicon Valley Bank and Signature Bank," said Keeton. "Investors and depositors — just seeing that that, here was another bank that had a lot of uninsured deposits — they started selling the stock."

  • Bill Keeton, associate teaching professor at the University of Missouri-Kansas City
Stay Connected
When I host Up To Date each morning at 9, my aim is to engage the community in conversations about the Kansas City area’s challenges, hopes and opportunities. I try to ask the questions that listeners want answered about the day’s most pressing issues and provide a place for residents to engage directly with newsmakers. Reach me at steve@kcur.org or on Twitter @stevekraske.
As Up To Date’s senior producer, I construct daily conversations that give our listeners context to the issues of our time. I strive to provide a platform that holds those in power accountable, while also spotlighting the voices of Kansas City’s creatives and visionaries that may otherwise go unheard. Email me at zach@kcur.org.
KCUR serves the Kansas City region with breaking news and award-winning podcasts.
Your donation helps keep nonprofit journalism free and available for everyone.