US President Joe Biden speaks during the Summit for Democracy virtual plenary on “Democracy Delivering on Global Challenges” in the Eisenhower Executive Office Building in Washington, DC, US, on Wednesday, March 29, 2023. Biden during the summit said he will seek $9.5 billion from Congress to promote democracy.
Yuri Gripas | Bloomberg | Getty Images
WASHINGTON — President Joe Biden on Thursday urged federal regulators to take up a set of reforms to safeguard the banking system, following the collapse of Silicon Valley Bank and Signature Bank.
The White House said in a fact sheet Thursday that Biden’s proposals fit into his recent effort “to strengthen oversight and regulation of larger banks so that we are not in this position again.” The administration wants regulators to take a range of steps to reinstate safeguards for banks with assets between $100 billion and $250 billion and bolster supervision over financial institutions.
“Each of these items can be accomplished under existing law,” the White House said.
Several of the proposals the White House endorsed are already under consideration, according to bank regulators who testified this week before two congressional committees.
Among these are stricter rules for measuring liquidity in mid-sized banks, those with over $100 billion in combined assets, but under $250 billion.
While the Trump-era deregulation bill passed in 2018 contained set limits on how much regulators could impose on small banks, it gave them broad discretion as to how to tailor bank capital requirements for the next category up.
The administration is encouraging bank regulators to reinstate liquidity rules under the Dodd-Frank Act that require mid-size banks to hold sufficient liquid assets to cover withdrawals during times of stress. Liquidity issues contributed to the failure of SVB and spread to other banks.
This is a developing story. Please check back for updates.