President Joe Biden has sought to reassure Americans that the banking system is safe, following the collapse of Silicon Valley Bank and Signature Bank.
In remarks from the White House on Monday, Biden said: “Americans can have confidence that the banking system is safe. Your deposits will be there when you need them. Small businesses across the country that deposit accounts at these banks can breathe easier knowing they’ll be able to pay their workers and pay their bills, and their hard-working employees can breathe easier as well.”
He added that he will ask Congress and 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.”
The president said no losses would be borne by the taxpayers, but instead, the money will come from the fees that banks pay into the Deposit Insurance Fund.
Treasury Secretary Janet Yellen ruled out a federal bailout for Silicon Valley Bank’s investors, telling CBS News that “we’re certainly not looking” to do that.
“Let me be clear that during the financial crisis, there were investors and owners of systemic large banks that were bailed out, and we’re certainly not looking,” Yellen said. The reforms that have been implemented ensure that we won't be repeating the same mistake.
The Biden administration also announced on Sunday that customers of Silicon Valley Bank and Signature Bank would have full access to their deposits, even if their account totals were above the maximum $250,000 covered by federal insurance.
HSBC Holdings plc announced that its UK ring-fenced subsidiary, HSBC UK Bank plc, is acquiring Silicon Valley Bank UK Limited (SVB UK) for £1. Noel Quinn, HSBC Group CEO, said the acquisition “makes excellent strategic sense for our business in the UK.”
On Friday, before regulators took possession of the failing SVB bank, employees of the bank were given their yearly bonuses, according to individuals with knowledge of the disbursement.
Additionally, SVB CEO Greg Becker sold $3.6 million in company shares on Feb. 27, less than two weeks before SVB revealed the massive losses that prompted its collapse.
0. “Biden speaks on banking crisis hoping to reassure Americans” ABC News, 13 Mar. 2023, https://abcnews.go.com/Politics/biden-speaks-banking-crisis/story?id=97820883
1. “Biden says Americans can “rest assured” banking system is secure after SVB collapse” CBS News, 13 Mar. 2023, https://www.cbsnews.com/news/joe-biden-silicon-valley-bank-collapse-watch-live-stream-today-2023-03-13
2. “Biden stresses that Silicon Valley Bank is not getting a bailout” The Hill, 13 Mar. 2023, https://thehill.com/homenews/administration/3897534-biden-stresses-that-silicon-valley-bank-is-not-getting-a-bailout/
3. “Biden vows to hold those responsible for Silicon Valley Bank failure ‘fully accountable'” KTVZ, 13 Mar. 2023, https://ktvz.com/politics/cnn-us-politics/2023/03/12/treasury-secretary-rules-out-bailout-for-silicon-valley-bank-2/
4. “Silicon Valley Bank collapse: Biden speaks Monday on financial sector crisis” NPR, 13 Mar. 2023, https://www.npr.org/2023/03/13/1163046482/watch-live-biden-discusses-the-silicon-valley-banks-meltdown-and-the-u-s-economy
5. “HSBC acquires Silicon Valley Bank UK Limited” HSBC, 13 Mar. 2023, https://www.hsbc.com/news-and-media/media-releases/2023/hsbc-acquires-silicon-valley-bank-uk-limited
6. “Silicon Valley's ‘greed and avarice' have ‘finally come home to roost' in SVB collapse, trader says” CNBC, 13 Mar. 2023, https://www.cnbc.com/2023/03/13/svb-collapse-silicon-valleys-greed-and-avarice-to-blame-trader-says.html