The recent turbulence in the banking industry has raised concerns about the possibility of another financial crisis similar to the one in 2008. However, today’s banking crisis would be different due to the widespread use of social media, online banking, and changes in regulations.

The collapse of Credit Suisse has been dubbed “the first bank crisis of the Twitter generation” by Paul Donovan, chief economist at UBS Global Wealth Management. The use of social media has amplified the importance of reputation, making banks more vulnerable to rumors and damaging information.

In addition, mobile banking has enabled customers to withdraw funds quickly, changing the behavior of bank users and the optics of a financial collapse. Bank runs can happen much faster today due to the combination of quick information dissemination and access to funds.

However, the European Union has implemented measures to prevent another financial crisis, including founding new financial oversight institutions and implementing stress testing to foresee any difficult scenarios and prevent market meltdown.

Danielsson, speaking to CNBC, stated that it is “unlikely” that European banks will face a crisis as serious as the one in 2008. This is because bank funding is more stable, regulators are more aware of the risks, and capital levels are higher. Banks today are expected to have more capital as a buffer, and the leverage ratios are a good metric to measure the difference between the current financial situation and 2008. The European Banking Authority also highlighted the resilience of the European banking sector in a statement about the Swiss authorities helping Credit Suisse.

However, individual players can still encounter difficulties even though the sector as a whole is resilient. According to Parker, there are “pockets of quite serious problems” rather than widespread issues across the industry. Fraser also made similar observations when comparing the current banking system with what happened in 2008, stating that this is not a credit crisis, but rather a situation where a few banks have some problems.

One parallel between the 2008 crisis and the current financial scene is the importance of confidence. Lack of trust has played a significant role in recent European banking turmoil, according to Thomas Jordan, chairman of the Swiss National Bank.

Even though banks have enhanced their capital and liquidity positions, and improved regulation and supervision, “failures and lack of confidence” can still occur, said José Manuel Campa, the chairperson of the European Banking Authority. Stefano Ramelli, an assistant professor in corporate finance at the University of St. Gallen, stated that trust and confidence in the system are fundamental laws of finance, and the most crucial capital for banks is the trust of depositors and investors. If trust is lost, anything can happen.