US Treasury Secretary says state will not bail out bankrupt SVB bank
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U.S. authorities will not buy bad loans from bankrupt Silicon Valley Bank (SVB), but are working to help its savers, Treasury Secretary Janet Yellen said in an interview. CBS.
Ms. Yellen said she had been working with US banking regulators all weekend to find a way to resolve the problems caused by the SVB bankruptcy. She noted that whenever a bank with billions in deposits fails, it is “worrisome.”
At the same time, the minister stressed that the US banking system remains safe and stable, largely due to the capital and liquidity controls developed during the financial crisis in 2008. According to her, the Ministry of Finance wants to make sure that the problems that exist in the SVB do not affect other banks.
She recalled that the US authorities rescued bankrupt investors and large systemically important banks during the crisis, but after the reforms of the banking system, the state has no such intentions. “But we care about contributors and are focused on meeting their needs,” Ms. Yellen said.
March 11, California Digital Regulator declared bankrupt SVB, the 16th largest bank in the US. The SVB bankruptcy was the largest since the 2008 crisis, the bank became the second largest bankrupt in US history after Washington Mutual Bank. In the investor prospectus, SVB explained that it needed to recover the $1.8 billion in losses it incurred as a result of the sale of part of its portfolio of assets.
In edition Axios believe that the US is facing a “catastrophic banking crisis” if the authorities do not rescue depositors’ funds before the opening of SVB branches on March 13. According to Axios, the US urgently needs to find a buyer for SVB, which will help the organization’s clients save their money. If this fails, the US will have to provide uninsured deposits, which is contrary to the policy of current President Joe Biden, the newspaper writes.
About the reaction of the US financial and technology markets to the collapse of SVB – in the material “Emergency high-tech bankruptcy”.
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