The rapid intervention of the United States government and regulators to insure all of Silicon Valley Bank and Signature Bank’s deposits after the organizations went bankrupt last week and to negotiate with banks for the First Republic’s bailout did not succeed. soothe swash And fears because the crisis is far from being contained or ended. HE context is is complex, both economically and politically. And the president of the United States, Joe Biden, tried to send a message to the citizens this Friday. zoom out another recovery image the unpopular of 2010 and impunity for bankers
Biden showed his “firm commitment” in his statement. Let those responsible for this mess be held accountable.”. it has provided “No one is above the law” and noted that strengthening accountability to avoid both mismanagement and excessive risk-taking in the future has a “significant deterrent” effect. He also reminded that Legislation limits your authority act against bankers, but summoned to congress to look like amount like boundary offsets or impose civil finesalso vget them back to their jobs in the industry those who contribute to the problems of their organizations through their mismanagement.
Expand FDIC mandates
Further details on Biden’s proposals are given in the explanatory document sent by the White House shortly after Biden’s statement. In particular, it asks Chambers to: Expanding the powers of the Federal Deposit Insurance Corporation (FDIC) for its English acronym, which already has the power to punish mismanagement).
In the case of compensations For example, the FDIC is reminded that due to the 2010 Dodd-Frank act, which was relaxed in 2018, it can recover money paid or received from the sale of shares in the case of managers of large banks. What Biden is demanding is new regulation that extends this power to i.includes smaller sized entities. And in perspective, stock sales The executives of Silicon Valley Bank and Signature Bank, who also intervened last Sunday, earned approx. days before its collapse.
The FDIC may also prohibit executives from taking other positions at banks if they “deliberately or consistently disregard the safety and soundness of their organizations” and fine them if their behavior “recklessly”, and Biden calls for these tools to be strengthened. standard laws to enforce veto or economic sanctions.
The President, who came out on Monday to make sure “the system is safe”, insisted on defending the measures taken by the administration and regulators in his statement, defending what he had done to the banking system.more flexible and stable”.