President Biden says the banking system is safe
DORAL, FL – After the U.S. government announced Sunday the emergency measures is taking to strengthen the banking system and backstop deposits at Silicon Valley Bank and Signature Bank in New York following their collapses, financial regulators said they will guarantee all deposits at the banks.
In the same line, President Biden added on Monday that “Americans can have confidence the banking system is safe”.
“Your deposits are safe,” Biden said from the Roosevelt Room. “Let me also assure you we will not stop at this. We will do whatever is needed on top of all this.”
He is referring to the course of action that will be taken to protect small businesses and workers in the wake of a regulator shutdowns of both banks.
These actions include backstopping depositors’ funds, making sure taxpayers don’t get affected by these moves, holding those at fault accountable and not extending relief to investors of Silicon Valley Bank.
“Management of these banks will be fired. If the bank is taken over by FDIC, the people running the bank should not work there anymore,” Biden said, adding that investors in the banks will “not be protected” because they knowingly took a risk.
Biden also commented there must be a “full accounting” of how this situation evolved and steps must be taken to ensure this “never happens again.”
“In my administration … no one is above the law,” Biden said, before calling on Congress to restore banking regulations rolled back during the Trump administration.
All this was motivated following what happened with Silicon Valley Bank (SVB), the 16th largest U.S. bank with $210 billion in assets, that was seized by California regulators on Friday after depositors rushed to withdraw funds over concerns the bank might become insolvent.
The incident, considered to be the second-biggest bank failure in the U.S. history, led customers of other banks to be fearful, which resulted in New York state regulators also shuttering Signature Bank on Sunday.