Biden says ‘our banking system is secure’ after two banks shut down

Addressing the White House Monday morning, President Biden spoke about what his administration did after two banks, Silicon Valley Bank and Signature Bank, were shut down by banking regulators. “Americans can rest assured that the banking system is secure. Your deposits are safe.”

video transcript

Joe Biden: Today, thanks to my administration’s swift action over the last few days, Americans can have confidence that their banking system is secure. Small businesses across the country who deposit accounts in these banks breathe easier knowing they can pay their employees and pay their bills. It also allows hard-working employees to breathe easily.

Last week, when I learned about the problems with banks and their impact on jobs, small businesses and the banking system as a whole, I directed my team to act quickly to protect these interests. they did it. they did it.

On Friday, the FDIC, the government regulator in charge, took control of the assets of Silicon Valley banks. And over the weekend, it took over the assets of Signature Bank. Treasury Secretary Yellen and a team of bank regulators took immediate action. And here are the highlights.

First, all customers who have deposits with these banks can rest assured. Rest assured they are protected. They can access their money starting today. This includes small businesses across the country that need to have a bank there, run payroll, pay bills, and stay in business.

No loss — this is the key point. There are no losses borne by the taxpayer. Let me repeat. There are no losses borne by the taxpayer. Instead, the money is derived from fees that banks pay to deposit insurance funds. Thanks to the actions our regulators have already taken, every American needs confidence that their deposits will be there when they need them.

Second, the management of these banks will be laid off. If the bank was taken over by his FDIC, the people running the bank shouldn’t be working there. Third, bank investors are not protected. They took risks on purpose. And if the risk doesn’t pay off, the investor loses money. That’s how capitalism works.

And fourth, there is the key question of how these banks got into this situation in the first place. A full explanation of what happened and why those responsible should be held accountable. No one in my administration is above the law. And finally, we need to reduce the risk of this happening again.

During the Obama-Biden administration, it imposed stringent requirements on banks, including Silicon Valley Bank and Signature Bank, including the Dodd-Frank Act to ensure the crisis we saw in 2008 never happened again. Unfortunately, the previous administration rolled back some of these requirements.

I will urge Congress and banking regulators to tighten banking rules to reduce the likelihood of another bank failure of this kind and to protect American jobs and small businesses. , the conclusion is this. Americans can be confident that their banking system is secure. Your deposit is safe.