Republican presidential contender Mitt Romney said on Tuesday U.S. markets were distressed and raised the possibility of a solvency crisis at U.S. banks.
"We have to make sure these institutions have sufficient capital," Romney told Reuters after a speech to Florida's Republican Jewish Coalition, describing the U.S. stock market as "distressed" after a plunge in global stock prices.
The former Massachusetts governor, who made a fortune as a venture capitalist before entering politics, said he saw a worrying trend in growing numbers of U.S. banks seeking capital offshore following a blowout in subprime mortgages.
He stopped short of predicting some banks would face the risk of insolvency. But in a speech earlier to Florida's Jewish Republican community he said he had been warned of such a crisis.
"We were talking about the credit crisis and how bad the credit crisis was and how to make sure the credit crunch is not spread, and someone sent a message back that said the credit crisis is so 2007 -- 2008 is a solvency crisis," he said.
"And that's obviously a very fearful perspective and hopefully one that does not rear its ugly head in reality. But people are talking about institutions having difficulty maintaining their level of capital," he added.
Stocks tumbled at the open on Tuesday, joining a global equity rout on fears of a U.S. recession. Investors dumped stocks despite the Federal Reserve's slashing benchmark interest rates by 75 basis points in a surprise decision.
Romney is in a close four-way race in Florida where the primary on January 29 is the next test in the state-by-state battles to determine the Republican and Democratic candidates who will square off in November's presidential election.
The multimillionaire former venture capitalist has retooled his campaign to emphasize his nearly 25 years of business experience that includes founding Bain Capital LLC, a successful Boston-based private-equity firm, in 1984.