Bernanke spooks markets with bank failure warning

The dollar hit a record low against the euro after Ben Bernanke, the chairman of the Federal Reserve, warned that small banks could fail in the coming months.

"There will probably be some bank failures," Bernanke told US lawmakers on Thursday 28 February, pinpointing small, newer banks in areas where house prices have plummeted as those at most risk.

However, there were no "serious problems" at the bigger banks, whose failure could pose a systemic threat, the chairman said, adding that their