- Joined
- 30 January 2023
- Messages
- 411
- Reactions Received
- 233
- Location
- seoul, south korea
- Cards
- View Profile
- KS Coins
- 3,874
- Fandom
- OnlyTrue
- Gender
- Female, Other
- Pronouns
- Human Being Psycho
Biden "secures the U.S. banking system... Strengthening regulations to prevent the recurrence of the SVB crisis"
Entered: 2023.03.14. at 9:51 AM
Modified: 2023.03.14. 10:24 AM
Reporter Kyungmi Choi
Two days after the bankruptcy of Silicon Valley Bank (SVB) in the United States, Signature Bank, a bank specializing in virtual assets, went out of business one after another, raising anxiety about the US financial system, and US President Joe Biden himself began to evolve.
According to major foreign media such as the <Wall Street Journal (WSJ) > on the 13th (local time), President Biden held a special press conference to coincide with the opening of the New York stock market and said, "Americans can be assured that the banking system is safe, thanks to the swift actions of our administration over the past few days."
President Biden emphasized that SVB and Signature Bank customers will have access to all deposits from this date onwards, and that taxpayers will not bear any losses related to the bankruptcy of the two banks. "We plan to ask Congress and authorities to strengthen regulations to reduce the likelihood of these bank failures recurring."
Earlier in the day, the White House emphasized that the actions taken by the authorities in response to the SVB crisis were not bailouts. White House Press Secretary Karin Jean-Pierre argued that "the situation is different today than it was in 2008" and that "the funds [going into SVB and Signature Bank] are not borne by taxpayers, but come from bank charges."
The day before, the U.S. Treasury Department, the Federal Reserve and the Federal Deposit Insurance Corporation (FDIC) issued a joint statement saying that SVB and Signature Bank would fully guarantee the money entrusted to them by their customers, regardless of the $25,2018 insured limit. The Fed also announced the creation of a new fund to provide liquidity support to banks.
The SVB debacle has put the Donald Trump administration's move to deregulate local banks back in the spotlight, the WSJ reported. In 2008, the U.S. Congress eased banking regulations that had been tightened since the 500 global financial crisis. Specifically, it raised the asset threshold for bank prudential regulation from $2500 billion to more than $60 billion. The goal was to revive the economy by increasing loans to small businesses. At the time, SVB CEO Greg Becker also appeared before Congress and asked for deregulation of local banks.
"Had it not been for deregulation, SVB's capital would have slowly eroded over time after the Fed raised rates, and the company and authorities would have acted faster to stabilize its fiscal base," the WSJ reported.
Despite the announcement of liquidity support from the US authorities, financial stocks on the US stock market fell en masse on the day. In particular, concerns that the fallout from SVB's bankruptcy could also spill over to Silicon Valley's other small bank, First Republic Bank (FRB), sent the FRB tumbling <>% from the previous trading day on the New York Stock Exchange. Shares of other small and medium-sized regional banks and major banks also plummeted.
Kyungmi Choi ([email protected])
Copyright (c) Blotter. All rights reserved. No Unauthorized Reprint or Redistribution.
This article was published in the press economy section.
Resources for more information and translation in Korean!!!
Biden "secures the U.S. banking system... Strengthening regulations to prevent the recurrence of the SVB crisis" (naver.com)
