Treasury Secretary Yellen: US banking system ‘stay healthy’

In the course of the decision of the supervisory authorities Two vulnerable lenders shut down to curb bank runsTreasury Secretary Janet Yellen tried to reassure members of Congress on Thursday that the US financial system remains strong.

In prepared remarks before the Senate Finance Committee on President Joe Biden’s fiscal 2024 budget proposal, Yellen said regulators took “determined and vigorous action” to gain control of California’s Silicon Valley Bank and New York’s Signature Bank take over and to guarantee all of their deposits, including those in excess of the $250,000 federal insurance limit – are designed to enhance depositor confidence.

“I can assure the members of the committee that our banking system remains sound and that Americans can be confident that their deposits will be there when they need them,” Yellen said. “This week’s actions demonstrate our unwavering commitment to keeping depositors’ savings safe.”

She spoke as part of Bidens push to pass a $6.8 trillion budgetwho proposes higher taxes on the wealthy to prop up Social Security and Medicare, along with increased military spending.

In the prepared remarks, Yellen also mentioned inflation, which continues to show gradual declines. February is The 6% level remains well above that the Federal Reserve’s 2% target. While the White House announced passage of the Inflation Reduction Act last year as a means to curb price growth, it did not mention the legislation by name.

“We’ve seen some moderation in headline inflation, but more needs to be done,” she said. “Our administration will continue to build on the actions we have taken to expand offerings and drive cost savings in areas such as energy and healthcare.”

Yellen’s comments come a day after Global Finance the markets were rocked by concerns about the viability of Credit Suisse, one of the largest and most important financial institutions in the world. Early Thursday, the Swiss lender said it would accept a $54 billion loan from the Swiss National Bank to stabilize its finances.

The announcement boosted Credit Suisse stocks even though the turmoil on Wall Street continuedwith First Republic and other regional US banks trading significantly lower Thursday morning.

Yellen is likely to face questions about US banks’ exposure to Credit Suisse and their potential resilience when confronted with a deepening global financial crisis.

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