President Biden emphasized that Silicon Valley Bank (SVB) would not receive a government bailout after regulators seized its assets.
He stated that taxpayers would not bear any losses and that the money to cover SVB’s failure would come from the fees that banks pay into the Deposit Insurance Fund.
Treasury Secretary Janet Yellen also ruled out the possibility of a bailout, stating that the government would not repeat the same mistakes made during the 2008 banking crisis.
Lawmakers from both parties also showed consensus around not allowing a bailout option for SVB, and some have even called for the bank to be purchased by an outside entity.
The FDIC created the National Bank of Santa Clara to hold SVB’s deposits and assets on Friday, and Biden stated that SVB’s investors would not be protected and its management would be fired.
This bank failure was the largest since the 2008 financial crisis.