In an effort to protect the US economy by increasing public trust in the country’s banking system, the Biden administration announced that Silicon Valley Bank depositors will be able to access their funds beginning Monday.
Overview
Proposals from the boards of the Federal Deposit Insurance Corporation (FDIC) and the Federal Reserve, as well as consultation with the president, Treasury Secretary Janet Yellen approved actions on Sunday that will allow the FDIC to complete its resolution of the Silicon Valley Bank in Santa Clara, California, in a way it protects all depositors, according to an official statement.
“We are announcing a systemic risk exception for Signature Bank, New York, New York, which was closed today by its state chartering authority. This institution’s depositors will be made whole “It stated.
End Note
However, shareholders and certain unsecured debt holders will not be protected, according to the interagency federal statement.
Finally, the Federal Reserve Board declared on Sunday that it would make additional funding available to eligible depository institutions to help ensure banks that have the ability to meet the needs of all their depositors.
