Biden Delivers 5-Minute Remarks on SVB Following Massive Crash

  • In a five-minute speech before taking off for San Diego, the president assured Americans that the U.S. banking system is "safe" and that "no losses will be borne by the taxpayers."
  • Silicon Valley Bank and Signature Bank have been shut down by state regulators in California and New York, respectively, over the last few days in the second-largest bank failure in U.S. history.
  • On Monday, Biden said the Obama administration had taken steps to make sure such a failure wouldn't happen again, but "the last administration rolled back some of these requirements."

President Joe Biden delivered brief remarks on the Silicon Valley Bank (SBV) chaos on Monday, speaking for just about five minutes before departing for San Diego, California.

After a weekend of financial turbulence, Biden addressed the bank run that led to the SVB collapse on Friday, as well as Signature's bank abrupt closure on Sunday, reassuring Americans that the U.S. banking system remains "safe" and that "no losses will be borne by the taxpayers."

He told customers who had deposits with the two banks that they would have access to their money as early as Monday but warned investors that they would not be protected as they "knowingly took a risk." Biden added that he would fire those running the banks and vowed to seek stronger regulations, without specifying how. The president took no questions after his quick speech.

Last week, SVB suffered the second-largest bank failure in American history after state regulators closed the bank and handed it over to the Federal Deposit Insurance Corporation (FDIC). The largest failure happened during the 2008 financial crisis with the fall of Washington Mutual.

Biden Silicon Valley Bank
President Joe Biden speaks about the banking system in the Roosevelt Room of the White House on March 13, 2023, in Washington, D.C. Anna Moneymaker/Getty

Two days after SVB shuttered, Signature Bank was forced to close its doors when state regulators said that keeping the bank open could threaten the stability of the entire financial system.

The president's remarks did reveal that he had no plans to hand out a taxpayer bailout, like those seen after the 2008 crash. Instead, the costs will be financed by the fees that the banks had paid the FDIC.

While SVB was little known outside of Silicon Valley, it is a key player in the tech sector and has been able to successfully compete with bigger-name banks. Signature Bank is even lesser known but its closure underscores the impact that SVB's fallout has on small or midsize banks.

On Monday, Biden said there were "important questions" about how these banks "got into the circumstance in the first place."

He suggested that the Trump administration was partly to blame for SVB's implosion, saying that the Obama administration had taken steps to ensure the 2008 crisis wouldn't happen again, but that "the last administration rolled back some of these requirements."

Biden's remarks echo the criticisms that other top Democrats have, pointing to Republicans who voted to reduce regulatory oversight on SVB in 2018—bipartisan legislation that was then signed into law by President Donald Trump.

In a Sunday statement, Vermont independent Senator Bernie Sanders said, "Let's be clear. The failure of Silicon Valley Bank is a direct result of an absurd 2018 bank deregulation bill signed by Donald Trump that I strongly opposed."

The Economic Growth, Regulatory Relief, and Consumer Protection Act—which saw support from some Democrats, like Senators Joe Manchin and Tim Kaine—was seen as a significant part of the 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act, which included regulations that Trump said were "crushing community banks and credit unions nationwide."

In response, Trump's campaign has put the fall of SB on "out-of-control Democrats and the Biden administration." Speaking to Fox News Digital, Trump campaign spokesperson Steven Cheung said the comments were "nothing more than a sad attempt to gaslight the public to evade responsibility."