President Biden on Monday said the banking system is safe, as he stressed steps taken to limit the fallout from the collapse of Silicon Valley Bank and shore up confidence in the financial system.
"Thanks to the quick action of my administration over the past few days, Americans can have confidence that the banking system is safe," Mr. Biden said in televised remarks.
Mr. Biden's remarks came one day after federal regulators announced emergency measures to guarantee all depositors with money at Silicon Valley Bank following its failure.
Regulators on Sunday said they had taken control of a second lender, Signature Bank, one of the main banks for cryptocurrency companies. Officials took the extraordinary step of designating SVB and Signature Bank as a systemic risk to the financial system, which gives regulators flexibility to guarantee uninsured deposits.
Mr. Biden said that deposits in SVB and Signature were safe and customers would have access to their money starting today and no losses would be borne by taxpayers. He said he would ask Congress and the banking regulators to strengthen the rules for banks, to "make it less likely this kind of bank failure would happen again."
He said investors in the banks will not be protected and management will be replaced. He said they knowingly "took a risk and when the risk didn't pay off, investors lose their money. That's how capitalism works."
The moves, designed to shore up wavering confidence in the banking system, were jointly announced on Sunday by the Treasury Department, the Federal Reserve and the Federal Deposit Insurance Corp.