Biden's SVB Crisis Speech Today: "You Can Access Deposits When Needed"

"Hold the Main Culprits Accountable, Strengthen Supervision and Regulation of Major Banks"

U.S. President Joe Biden will deliver a national address on the 13th (local time) regarding the financial sector crisis triggered by the collapse of Silicon Valley Bank (SVB).

According to major foreign media on the 13th, President Biden stated in a statement on the 12th (local time), "Tomorrow morning (the 13th), I will give a speech on how to maintain the resilience of the banking sector and protect our historic economic recovery."

President Biden emphasized, "Americans and American businesses can have confidence that they will be able to access their deposits when needed," adding, "We are committed to holding those responsible for this turmoil fully accountable to ensure that we never face such a situation again, and to continuing efforts to strengthen oversight and regulation of large banks."

Earlier, the U.S. Treasury Department, Federal Reserve (Fed), and Federal Deposit Insurance Corporation (FDIC) announced that they would guarantee all customer deposits at SVB regardless of the insurance limit. Treasury Secretary Janet Yellen reported the Fed and FDIC's recommendation to President Biden, who approved a solution that fully protects all depositors. However, some shareholders and unsecured creditors were excluded from protection.

Regarding this, President Biden said, "At my direction, over the weekend, the Treasury Secretary and the Chair of the National Economic Council (NEC) worked diligently with financial regulatory agencies to resolve the issues with SVB and Signature Bank," adding, "We reached a swift solution that protects workers and small businesses and keeps our financial system safe." He also emphasized, "This measure prevented taxpayer money from being put at risk."

SVB, established in 1982, is a major bank in the technology startup sector. For the past 40 years, it has served as a funding source for the venture capital (VC) and startup ecosystem, but due to a liquidity crisis and a bank run (massive withdrawal of deposits), U.S. financial authorities ordered its emergency closure. The U.S. financial authorities also shut down Signature Bank, based in New York. The government stated, "The New York State financial authorities suspended operations of Signature Bank as of today, considering similar systemic risks as with SVB." Global financial markets are on high alert over the possibility that the SVB incident could spread to bank runs at other banks, escalating into a crisis across the entire financial system.