Biden calls for trust in banks after bankruptcies

WASHINGTON (AP) — President Joe Biden assured Americans on Monday that the country’s financial systems were secure, an attempt to project calm after the shocking and rapid collapse of two banks raised fears of a broader upheaval.

“Their deposits will be there when they are needed,” he said.

Federal banking regulators chose to urgently shut down Silicon Valley Bank on Friday as depositors were withdrawing billions of dollars from the institution within hours. It was the second-worst banking meltdown in US history, behind the 2008 bankruptcy of Washington Mutual. But the financial bloodshed was quick: New York-based Signature Bank also went bankrupt. .

The president, speaking from the White House shortly before a trip to the US West Coast, said he would hold those responsible to account and pushed for better oversight and regulation of the biggest banks. And he promised that taxpayers would not bear the losses.

“We need to know everything that happened,” he said. “Americans can be sure that the banking system is secure.”

Biden added that bank managers should be fired.

“If the FDIC takes control of the bank, the people who run it should no longer work there,” he said, referring to the Federal Deposit Insurance Corporation, the agency responsible for ensuring the stability of the system. banking.

With over $110 billion in assets, Signature Bank is the third largest bank failure in US history. Another troubled bank, First Republic Bank, announced on Sunday that it had strengthened its financial health by accessing funding from the Federal Reserve and JPMorgan Chase.

The events caused concern in the markets at the start of their operations on Monday. Asian and European markets fell, but not dramatically, and US futures fell.