Biden says US banking system is safe after SVB, Signature collapse
US President Joe Biden pledged on Monday to do whatever is needed to address a banking crisis threatened by the collapses of Silicon Valley Bank and Signature Bank, which forced regulators to step in with emergency measures.
Biden's address came after weekend moves by the United States to guarantee deposits at collapsed tech-focused lender SVB failed to reassure investors about the health of other banks around the world.
Biden said his administration's rapid action over the weekend should give Americans confidence that the US banking system is safe, adding that he was going to ask Congress and regulators to strengthen bank rules.
"Americans can have confidence that the banking system is safe. Your deposits will be there when you need them."
US regulators on Sunday stepped in after the collapse of SVB - the largest US bank failure since 2008, which suffered a run after a big hit on a portfolio of bonds.
SVB's customers will have access to all their deposits starting Monday and regulators set up a new facility to give banks access to emergency funds. The Federal Reserve also made it easier for banks to borrow from it in emergencies.
Regulators moved swiftly too to close New York’s Signature Bank , which had come under pressure in recent days. But more stress is expected.
Rules introduced after US banks sparked a global financial crisis in 2008 by aggressive mortgage lending may come under the spotlight in the coming days. They were partially repealed in 2018 under former President Donald Trump.
The changes to the Dodd-Frank Act pushed by Republicans raised the threshold at which banks are considered systemically risky and subject to stricter oversight to $250 billion from $50 billion. Silicon Valley bank had $209 billion in assets at the end of last year.
Democrat Biden faces a divided Congress after Republicans took control of the House of Representatives in January, and new US bank regulations could be difficult.
