Biden Urges Trust in Banks After Second Collapse
‘Americans can have confidence that the banking system is safe,’ the president says, adding that the managers of the failed banks should be fired.

President Biden insisted Monday that the nation’s banking system was safe, seeking to project calm after the collapse of two banks stirred fears of a broader upheaval and prompted regulators to offer emergency loans to banks to stave off additional failures.
“Your deposits will be there when you need them,” Mr. Biden said.
Despite the message from the White House, investors continued to dump shares in bank stocks. Shares of First Republic Bank plunged more than 70 percent even after the bank said it was accessing emergency funding from the Federal Reserve as well as additional funds from JPMorgan Chase.
American regulators closed Silicon Valley Bank on Friday after depositors rushed to withdraw their funds all at once. It was the second largest bank failure in American history, behind only the 2008 failure of Washington Mutual. New York-based Signature Bank also failed.
Speaking from the White House shortly before a trip to the West Coast, the president said he would seek to hold those responsible accountable, and he pressed for better oversight and regulation of larger banks. He promised that no losses would be borne by taxpayers.
“We must get the full accounting of what happened,” he said. “Americans can have confidence that the banking system is safe.”
Mr. Biden also said the managers of the banks should be fired.
“If the bank is taken over by the FDIC, the people running the bank should not work there anymore,” he said, referring to the Federal Deposit Insurance Corporation, the agency responsible for ensuring the stability of the banking system.
International regulators also had to step in to ease investor fears. The Bank of England and U.K. Treasury said they had facilitated the sale of a Silicon Valley Bank subsidiary in London to HSBC, Europe’s biggest bank. The deal protected $8.1 billion of deposits.
Under the plan announced by American regulators, depositors at Silicon Valley Bank and Signature Bank, including those whose holdings exceed the $250,000 insurance limit, will be able to access their money on Monday.
Under a new Fed program, banks can post those securities as collateral and borrow from the emergency facility.
The Treasury has set aside $25 billion to offset any losses incurred. Fed officials said, however, that they do not expect to have to use any of that money, given that the securities posted as collateral have a very low risk of default.
Though Sunday’s steps marked the most extensive government intervention in the banking system since the 2008 financial crisis, the actions were relatively limited compared with 15 years ago.
The two failed banks themselves have not been rescued, and taxpayer money has not been provided to them.