Joe Biden: “The US banking system is safe”

President Joe Biden He told US residents on Monday that the country’s financial systems were sound, following the shocking and rapid failure of two banks that raised fears of a wider upheaval.

“Americans can be sure that the the banking system is safehe said from the Roosevelt Room before a West Coast trip. “Your deposits will be there when they need it.”

US regulators shut down Bank of Silicon Valley Friday after suffering a traditional bank run, in which depositors rushed to withdraw their funds all at once. It was the second largest bank failure in U.S. history, second only to that of Washington Mutual In 2008.

Sign of the speed with which financial hemorrhageregulators have announced that the Signature Bankbased in New York, had also gone bankrupt.

The president, from the Roosevelt Room shortly before US markets opened, said he would try to hold the culprits accountable and pushed for improve the supervision and regulation of large banks.

“I will ask Congress and banking regulators to tighten the rules for banks so that this type of bank failure is less likely to happen again,” he said in a televised address from the White House.

Biden He added that “the management of these banks will be fired”.

Likewise, Biden promised that no loss would be borne by taxpayers.

“The money will come from the fees banks pay for deposit insurance,” he said.

The governments of UNITED STATES there Britain they took extraordinary measures to avoid a possible banking crisis.

US regulators worked all weekend to find a buyer for the Bank of Silicon Valleywhich had more than $200 billion in assets and was aimed at tech start-ups, venture capitalists, and high-paying tech workers.

Although those efforts appear to have failed, authorities assured all bank customers that they would be able to access their money on Monday.

He bank of england and the british treasure announced on Monday morning that they had facilitated the sale of the London branch of the Silicon Valley bank to HSBCthe largest bank in Europe, guaranteeing the safety of 6.7 billion pounds (8.1 billion dollars) of deposits.

The guarantees were part of an extensive program of emergency loans intended to prevent a wave of banking avalanches that would threaten the stability of the banking system and the economy as a whole.

The New York Stock Exchange opened lower on Monday, in a market shaken by the specter of a possible contagion despite announcements of official contingency measures to guarantee deposits.

During the first exchanges, the Dow Jonesits given 0.59%, technology Nasdaq0.80%, and the broad S&P 500 index, 1.08%, while several regional banks went bankrupt.

The gestures of european banks They were also severely punished on Monday. Swiss credit it leads the declines with a fall of 14%, after several quarters of poor results, but entities deemed more solid have also felt the blow.

German Commerzbank fall of 11.3%, the French Societe Generale and the Spaniards Sabadell they fell 6.2% and 9.4%, respectively. Another Spaniard, Santander lost 7.4% and the Dutch ING and 8.3%.

He The pan-European STOXX 600 index fell 2.4% and posted its biggest percentage decline since December 2022. Banks, automakers and insurers were the main bearers.

Concerns have been raised about the resilience of the sector’s balance sheet in the face of the collapse of SVB. However, the European Central Bank (ECB) does not plan an emergency meeting of its banking supervisory board on Monday, it said Reuters a high level source.

Meanwhile, investors now see a nearly 90% chance that the Fed will raise interest rates by 25 basis points (bps) next week, a sharp reversal from the 50bp hike they had previously expected after strong economic data.

News in development…