The President of the United States – Joe Biden – thinks the turbulence that recently shook the banking sector is not entirely gone. As such, his cabinet is ready to impose further legislative changes to cope with any potential issues in the future.
Two of America’s leading banks – Silicon Valley Bank (SVB) and Signature Bank – experienced severe operational issues and were shut down by regulators earlier this month. Major institutions outside the States, including Credit Suisse and Deutsche Bank – also revealed liquidity problems.
- President Biden praised his administration for taking adequate measures during the banking crisis, which sparked fears of another gigantic financial crash similar to the one in 2008:
“We’ve done what we need to do executively. I feel confident things are settling out. The markets seem to be responding.”
- Nonetheless, the leader sees a chance of further problems in the banking industry, saying the government is monitoring things closely:
“No, it’s not over yet. We’re watching very closely. I think my team has handled it very well so far. And rather than get ahead of myself here, I think let’s let things move the way they are.”
- The US watchdogs closed Signature Bank and SVB this month over concerns about their solvency. Both institutions serviced numerous cryptocurrency clients.
- Biden’s first speech after the collapse came in the middle of the month when he described the US banking system as “safe.”
- Despite his assuring statement, some American banks are still shaking. First Republic Bank – one of the top 15 largest in the country- saw its shares decrease by nearly 90 in the past 30 days.
- The Swiss-headquartered Credit Suisse also experienced significant issues lately and was acquired by Switzerland’s biggest banking institution – UBS Group – for over $3 billion.
- Bitcoin reacted positively to the deal, surging beyond $28,500 for the first time since June 2022.