In order to reassure People that the U.S. banking system remained robust and allay concerns that this was the start of other financial institution collapses, President Joe Biden stated on Monday that prompt action to protect the deposits of two closed banks was necessary.
“Americans can trust that the financial system is secure. You’ll have access to your deposits when you need them “Before leaving for California, Biden told reporters on Monday morning from the Roosevelt Room of the White House.
Many were concerned that the closures of California’s Silicon Valley Bank, which managed the finances of numerous Internet firms, and New York Signature Bank would cause a client panic that may trigger a string of other bank failures when Biden gave his morning briefing at the White House.
“No damages will be incurred by the taxpayers, and I want to stress how vital this is. No losses will be borne by the taxpayers, let me say that again. The funds will instead come from the fees that banks pay to the Deposit Insurance Fund “announced Biden on Monday.
In the end, Americans can rest easy knowing that our banking system is secure, Biden stated. Your bank deposits are secure.
All clients, according to Biden, may “rest confident” that they will be safe and able to access their funds on Monday. He claimed that the change will enable businesses to continue operating and to pay employees and debts. Deposits up to $250,000 are typically insured by the Federal Deposit Insurance Corporation, however the administration’s action will give that safety net to all depositors.
The president said that fees from the deposit assurances will come from fees paid by the banking industry into the federal insurance fund and not taxpayers. He added that those running failed banks will lose their jobs when they come under the control of the feds.
“The management of these banks will be fired,” Biden said. “If the bank is taken over by the FDIC, the people running the bank should not work there anymore.”
Biden said while depositors will have their funds protected, investors in the banks will not enjoy the same luxury.
