President Joe Biden urged Congress to give regulators greater authority to claw back pay and punish executives at distressed banks who contributed to the failure of their institutions through mismanagement.
In a statement released on Friday, Biden said, "No one is above the law — and improving accountability is a crucial disincentive to prevent mismanagement in the future. "It should be simpler for regulators to recoup remuneration from executives, levy civil penalties, and ban Executives from working in the banking industry again when banks collapse due to poor management and excessive risk-taking."
Biden emphasized that the law placed restrictions on his ability to hold executives accountable and he requested help from Congress.
“Senior bank executives whose poor management led to the failure of their firms must face heavier punishment,” according to Biden.
The Federal Deposit Insurance Corp. and Federal Reserve will fully insure deposits at both failed banks, Silicon Valley Bank and Signature Bank, according to the nation's top bank regulators, who announced this on Sunday. Wall Street and major financial institutions will cover the cost rather than taxpayers. The New York-based Signature Bank, which was shut down on Sunday due to the same concerns about systemic contagion as SVB, had been a well-liked source of financing for cryptocurrency businesses.
The president highlighted that although the measures taken over the weekend were not paid for with government money, they were required to stop additional economic damage.
“Because of the steps, we took,” Biden claimed, "Our banking system is more resilient and stable today. "On Monday morning, I assured the American people and businesses that they may be sure that their deposits will be available as needed. That's still the situation. ”
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