ISTANBUL

The US Federal Reserve expects the recent banking turmoil to push the nation’s economy into "a mild recession" later this year, according to its minutes released Wednesday.

"Given their assessment of the potential economic effects of the recent banking-sector developments, the staff’s projection at the time of the March meeting included a mild recession starting later this year, with a recovery over the subsequent two years," the minutes said.

The Fed's projections come after four US banks abruptly failed last month -- Silvergate Bank, Silicon Valley Bank (SVB), Signature Bank and First Republic Bank.

"Regional banks with an unusually large reliance on uninsured deposits and holdings of securities with significant unrealized mark-to-market losses experienced larger declines in stock prices," the minutes said.

The US central bank added that developments so far would likely lead to some weakening of credit conditions as some banks were likely to tighten lending standards amid rising funding costs and increased concerns about liquidity.