US President Joe Biden on Monday mentioned that Individuals can retain their confidence on the US banking system after failures and fears of worldwide ripple results because of the Silicon Valley Financial institution collapse, information company AP reported.
President Biden mentioned: “You’ll be able to have faith that the banking system is secure. Your deposits will likely be there if you want them.” “No losses will likely be borne by the taxpayers. Let me repeat that. No losses will likely be borne by the taxpayers,” he mentioned.
In a five-minute speech, Biden highlighted 4 factors: Keep away from panic, No bailout with taxpayers’ cash, fixing accountability, motion will to keep away from such a scenario in future.
He additionally known as on the Congress and regulators to strengthen guidelines on banks after failures.
US Treasury Secretary Janet Yellen had additionally mentioned earlier that the federal government is not going to bail out Silicon Valley Financial institution (SVB), following its shutdown by regulators final Friday. Yellen mentioned a number of reforms had been launched after the 2008 monetary disaster with the only purpose to forestall any requirement for a bailout by the federal government.
When requested if the US authorities will intervene as a part of emergency measures within the SVB meltdown points, notably with respect to bailout issues, Yellen replied, “America’s financial system depends on a secure and sound banking system that may present for the credit score wants of our households and companies. So every time a financial institution, particularly one like Silicon Valley Financial institution with billions of {dollars} in deposits fails, it’s clearly a priority.”
Earlier, the US authorities had mentioned that SVB depositors “may have entry to all of their cash beginning Monday (March 13)”. It mentioned that taxpayers gained’t be chargeable for any losses related to SVB’s decision.
WHAT HAPPENED TO SILICON VALLEY BANK?
Silicon Valley Financial institution (SVB), a serious US lender for enterprise capital-backed firms, was seized by California banking regulators on Friday. The Federal Deposit Insurance coverage Company (FDIC) in its order mentioned that the transfer is aimed “to guard insured depositors”.
The closure of SVB is seen as the most important financial institution failure since Washington Mutual throughout the peak of the 2008 monetary disaster. The financial institution failed after depositors, principally know-how employees and enterprise capital-backed firms, started withdrawing their cash from the financial institution.
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