Biden Vows to Strengthen Banking Regulations After Silicon Valley and Signature Bank Failures
President Joe Biden addressed the nation on Monday, assuring Americans that the banking system is safe and that their deposits will be there when they need them.[0] The speech came after the collapse of Silicon Valley Bank and Signature Bank raised fears of a full-blown banking crisis.
Biden said he will ask Congress and the banking regulators to strengthen the rules for banks to make it less likely this kind of bank failure would happen again and to protect American jobs and small businesses.[1] He also noted that “no losses will be borne by the taxpayers” and the money will come from the fees that banks pay into the Federal Deposit Insurance Corporation.[2]
The collapse of Silicon Valley Bank and Signature Bank sent shockwaves throughout the financial world, prompting swift and decisive action from the Biden administration. Treasury Secretary Janet Yellen ruled out a federal bailout for Silicon Valley Bank during an interview on CBS News' Face the Nation Sunday.[3] Rather than bailing out the bank, the Biden administration and federal regulators on Sunday night said they would to backstop customers’ deposits—even those that weren’t insured.[4]
The Federal Deposit Insurance Corporation (FDIC) took control last week of SVB's assets after the bank ran out of cash.[5] On the weekend, Federal regulators determined that Signature Bank of New York posed a systemic risk and took control of it.[5] The president stated that, including small businesses that require funds for payroll, customers of the banks will have instantaneous access to their money.[5]
Biden also vowed to hold those responsible for the Silicon Valley Bank collapse “fully accountable” and to continue efforts to strengthen oversight and regulation of larger banks.[6]
“The American people and American businesses can have confidence that their bank deposits will be there when they need them. I am firmly committed to holding those responsible for this mess fully accountable and to continuing our efforts to strengthen oversight and regulation of larger banks so that we are not in this position again,” he said.[7] “I’m pleased they reached a solution that protects workers, small businesses, taxpayers, and our financial system.[7]
0. “Following SVB Failure Biden Vows to Hold Banks Accountable” Bloomberg, 13 Mar. 2023, https://www.bloomberg.com/news/articles/2023-03-13/biden-says-he-will-seek-stronger-regulations-for-banks-lf6ugqxe
1. “Biden stresses taxpayer funds won’t be used in Silicon Valley Bank collapse – live” The Guardian US, 13 Mar. 2023, https://www.theguardian.com/us-news/live/2023/mar/13/silicon-valley-bank-collapse-biden-address
2. “Biden says “banking system is safe” after Silicon Valley Bank collapse” Axios, 13 Mar. 2023, https://www.axios.com/2023/03/13/biden-says-banking-system-is-safe-after-svb-collapse
3. “Biden vows to hold those responsible for Silicon Valley Bank failure ‘fully accountable'” CNN, 13 Mar. 2023, https://www.cnn.com/2023/03/12/politics/janet-yellen-bailout-silicon-valley-bank-cnntv/index.html
4. “Wall Street pummels regional banks, despite Biden's assurances” CNN, 13 Mar. 2023, https://www.cnn.com/2023/03/13/investing/first-republic-bank/index.html
5. “Banking crisis: President Joe Biden says taxpayer money won't be used to bail out SVB, Signature Bank” Yahoo Finance, 13 Mar. 2023, https://finance.yahoo.com/banking-crisis-president-joe-biden-132320292.html
6. “Biden says ‘the banking system is safe' after Silicon Valley Bank shutdown” NBC News, 13 Mar. 2023, https://www.nbcnews.com/politics/politics-news/biden-deliver-remarks-silicon-valley-bank-shutdown-rcna74622
7. “Relief checks live updates: Social Security payments, tax refunds, student loan debt…” AS USA, 13 Mar. 2023, https://en.as.com/latest_news/relief-checks-live-updates-social-security-payments-tax-refunds-student-loan-debt-n-3/
