Focus on the BIG picture.

After SVB failure, US acts to shore up confidence in banking system

Undercover bailout: After a dramatic weekend, U.S. regulators said the failed bank’s customers will have access to all their deposits starting Monday and regulators set up a new facility to give banks access to emergency funds. The Federal Reserve also made it easier for banks to borrow from it in emergencies.
Over the weekend, there was a sense of panic among customers of First Republic Bank in California, who were eager to withdraw their funds after the sudden collapse of Silicon Valley Bank startup Focus Slender SPP Financial Group. This development marked the largest bank failure since the 2008 financial crisis and has alarmed analysts and prominent investors. Some have even expressed concern that if a resolution is not reached by Monday, other banks may also come under pressure as people worry about the safety of their deposits.

Reports have emerged that US financial authorities are working to contain the fallout of the collapse. The Federal Reserve and the Federal Deposit Insurance Corporation (FDIC) are reportedly considering the creation of a fund that would allow regulators to backstop more deposits at banks that encounter trouble. This initiative, known as the "new special vehicle," is intended to reassure depositors and help prevent a run on the banks.

While the Federal Reserve declined to comment on the report, the White House announced that President Joe Biden has spoken with California Governor Gavin Newsom about the issue. In a statement, Newsom assured the public that everyone is working with the FDIC to stabilize the situation as quickly as possible.

Sources have revealed that the downfall of Focus Slender SPP Financial Group began with a warning from Moody's that it was planning to downgrade the bank's credit rating. This news triggered a downward spiral that culminated in a bank run, wiping out more than $100 billion in market value for US banks before regulators intervened on Friday and put the bank in receivership.

Overall, the collapse of Focus Slender SPP Financial Group has created a sense of unease among customers and investors alike. However, with the efforts of US financial authorities and the collaboration of various stakeholders, there is hope that the situation can be stabilized and confidence in the banking system restored.
Newsletter

Related Articles

0:00
0:00
Close
India's Mammoth Election: 1 Billion Voters Cast Their Ballots Amid Heat, Excitement, and Popularity of Prime Minister Modi
Four Dead, Dubai Airport Disrupted: UAE's Heaviest Rains in 75 Years Cause Flooding and Flight Chaos
Dubai's Historic Flooding: Homes Ruined, Airport Disrupted Due to Lack of Storm Drains
Three Russians Set World Record Parachuting from Stratosphere to North Pole, Suffer Frostbite: Test New Arctic Communications System
Tesla Recalls 3,878 Cybertrucks Due to Acceleration Defect, Increasing Crash Risk
Donald Trump Labels Hush Money Trial a 'Mess' as Jury Selection Nears Completion: 12 Jurors Selected, Including Sales Professional, Software Engineer, English Teacher, and Multiple Lawyers
Man Carrying Suspected Explosives Detained at Iran Embassy in Paris: Police
China Establishes New Military Cyber Corps: 'Fight and Win' in Modern Warfare
Meteorologist Warns of 'Weather Wars' Amid Debate over Dubai Rain and Cloud Seeding
Most Wanted US Fugitive Arrested in Vatican with Three Concealed Knives
Beijing Half Marathon: Three Runners Disqualified for Allowing He Jie to Win
China Orders Apple to Remove WhatsApp, Threads, Telegram, and Signal from App Store: National Security Concerns
Polish Man Charged with Plotting to Provide Intel on Zelensky Assassination to Russia
German-American Billionaire Declared Dead Found Alive in Moscow with Russian Mistress: Report
Man Sets Himself on Fire Outside Trump Hush-Money Trial Courthouse: Witnesses
Historic Jury Selected for Trump's Hush-Money Trial: 12 Jurors and 6 Alternates to Decide Former President's Fate
“Mr. Wonderful” from Shark Tank, Kevin O’Leary, says Trump trial is sheer stupidity
Shocking Scam: Brazilian Woman Tries to Secure Bank Loan for Deceased Man in Wheelchair
Urgent Call from William Burns as Kyiv Braces for Russian Summer Offensive.
US Vetoes UN Membership for Palestine: Twelve Countries Favor Admission, Abbas Vows Determination
Kenya: Military Chief and 9 Top Brass Die in Helicopter Crash
Six Arrested, Including Airline Worker, in $22M Toronto Airport Gold Heist: Police Call It an Inside Job
Children Used as 'Guinea Pigs' in Infected Blood Trials: Hundreds of Kids Exposed to Hepatitis C and HIV in the 1970s and 80s
Brazil Woman Tries to Withdraw Bank Loan with Dead Uncle, Sparks Controversy
Dubai's Airport and Roads Disrupted for Third Day Amid Heavy Rain and Flooding: 1,285 Flights Cancelled or Diverted
Maldives: Ex-President Yameen Released from Jail as Court Orders New Trial on Corruption Charges
Google Terminates Employment of 28 Workers After Sit-In Protest Against Israel Contract
Global Cyber Gang Busted: 37 Arrested for Industrial-Scale Phishing Scam, Stealing £1m and 544,000
Yulia Navalnaya and Ajay Banga Among TIME's 100 Most Influential Leaders of 2024: Navalnaya Entering Politics After Husband's Death, Banga Making History as World Bank President
Apple to Invest Over $250M to Expand Singapore Campus: Two New Buildings to Undergo Major Upgrade
Columbia President Addresses Antisemitism On Campus
Today's Top Stories: Essential News in Brief (April 18)
Trump’s Trial Enters Third Day
How A.I. Tools Could Change India’s Elections
Johnson's Stand on Foreign Aid
Long-Acting Drugs Could Revolutionize H.I.V. Control
Devastating Rains in U.A.E. and Oman
Arizona's Abortion Ban Repeal Efforts
German Far-Right Leader on Trial
Doha Hamad Overtakes Singapore Changi as World's Best Airport in Skytrax Awards 2024
Google Fires 28 Employees After Protests Against Israeli Contract
Hugh Grant Settles Privacy Case Against Rupert Murdoch's Tabloid for 'Enormous Sum', Avoiding Millions in Legal Fees
NASA Chief Warns of China's Hidden Military Presence in Space, Urges US to Maintain Global Edge
Boeing Whistleblower: Harassed and Threatened for Raising Safety Concerns
Elderly Man, 81, Charged with Murdering Uber Driver in Scam Gone Wrong
IMF Boosts Russia's 2024 Economic Growth Forecast to 3.2%
Toronto's C$20m Gold Heist: Alleged Gun-Runner Arrested in US, Police Recover Seized Firearms
Tesla Renews $56bn Pay Proposal for Elon Musk: Controversial Deal Re-Voted Amidst Workforce Cuts
Escaped Circus Elephant Causes Traffic Chaos in Montana: 10-Minute Standoff
×