The US banking industry is in pretty good shape heading into this economic dislocation, Timothy Sloan, former CEO of Wells Fargo and special advisor to Fortress Capital, said in a webinar last week hosted by Los Angeles-based George Smith Partners. The conversation included Don Griffith, former chairman and CEO at Grandpoint Bank and Pat Jackson, president and CEO of Sabal Capital Partners.

"The combination of good management decisions in the banks themselves and the regulatory changes that were made, meaning that the banking system has two-to-three times the amount of capital and liquidity," explained Sloan in the conversation, differentiating this event from the previous recession during the financial crisis. "The system is in pretty good shape, and you can see that in the fact that we are in a difficult economic environment, and while the banks have decided to suspend share buybacks, they are continuing with dividends. That is not what we saw in the financial crisis."

Banks have taken a conservative step back from lending activity, largely because of the market uncertainty, but this is a very different retreat than occurred in 2008. Today, according to Sloan, banks are still able to serve customers and there is little concern about stability and the ability to provide capital—the chief function of the banking system. "I think it is in good shape on an absolute basis and also relative to the rest of the world," he added.