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Joe Biden defended the US banking system, but clarified that his government “will not take responsibility for the losses”

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President Joe Biden assured Americans on Monday that their banking system “is safe” and their deposits will be available “when they are needed”, after the bankruptcy of Silicon Valley Bank and Signature Bank, which threatened to trigger a broader crisis.

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In statements from the White House, Biden added that US taxpayers will not bear the bank’s losses and that he will ask Congress to “strengthen” regulation of the banking sector.

Biden on Sunday hinted at new regulation of big banks following America’s biggest bank failure since the 2008 financial crisis, but he faces a divided Congress that is unlikely to pass tougher new rules.


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His economic team worked with regulators over the weekend on the measures, which include guaranteeing deposits at both banks, establishing a new mechanism to give financial institutions access to emergency funds and making it easier for banks to borrow from the Fed. Federal in emergencies.

The measures sent waves of relief to Silicon Valley and sent stock futures rallying, but the crisis is testing confidence in the US financial system and fears persist that the fallout will roil global markets later in the week.

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“The American people and American businesses can trust that their bank deposits will be there when they need them,” Biden said in his statement on Sunday.

Biden will make remarks Monday morning on further plans to keep the economy running amid a crisis sparked by the sudden collapse of Silicon Valley Bank (SVB) last week, he added.

“I am strongly committed to holding those responsible for this disaster accountable and to continue our efforts to strengthen oversight and regulation of big banks so we don’t find ourselves in this situation again,” Biden said. His comments are expected after 08:00 local time (1200 GMT).

US markets open at 9:30 a.m. (1:30 p.m. GMT).

The US Federal Deposit Insurance Corporation said Monday that it had transferred all Silicon Valley Bank deposits to a newly created bridge bank and that all depositors would have access to their money starting Monday morning.

Source: Ambito

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