President Joseph Biden assured this morning that, thanks to the quick action of his administration in recent days, "Americans can trust that the banking system is safe", and that "their deposits will be there when they need them" after the bankruptcy from SVB.
And it is that, after the Silicon Valley Bank shares collapsed last Friday, and with them uncertainty was generated in the country's financial system, the Signature Bank collapse was also reported.
“Small businesses across the country that had deposit accounts at these banks can breathe easy knowing they will be able to pay their workers and pay their bills. And their workers can also breathe easy," Biden said at a press conference.
The president explained that last week, upon learning of the banks' problems and the impact they could have on employment, some small businesses and the banking system in general, he gave instructions to act quickly and protect those interests.
He also explained that the government regulator in charge, the Federal Deposit Insurance Corporation (FDIC), took control of Silicon Valley Bank's assets last Friday and those of Signature Bank over the weekend.
According to what was indicated, he specified that the US Treasury Secretary, Janet Yellen, and a team of bank regulators have taken immediate measures, among which are the protection of customer deposits and access to them from today, which includes small businesses.
“Taxpayers will not suffer losses, and this is an important point. Let me repeat it: Taxpayers will not suffer a loss. Instead, the money will come from fees banks pay to the Deposit Insurance Fund," President Biden said.
"Thanks to the actions our regulators have already taken, all Americans can be sure that their deposits will be there when they need them," he added.
He explained that the management of both banks will be fired and that if the FDIC takes over the bank, the people who run it should no longer work there, while investors will not be protected because, he said, they took a risk knowing that it wasn't worth it. "Investors lost their money. That's how capitalism works."
Finally, he specified that both banks must offer a full explanation of what happened.
Biden recalled that during the Obama-Biden administration, strict requirements were placed on banks such as Silicon Valley Bank and Signature Bank, including the Dodd-Frank Act, to ensure that the crisis experienced in 2008 is not repeated.
«Unfortunately, the last government? Trump Administration? has removed some of these requirements. I will ask Congress and banking regulators to strengthen the rules for banks to make it less likely that this type of bank failure will happen again and to protect America's jobs and small businesses."
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