To stem banking crisis, more than a dozen U.S. banks inject funds into First Republic Bank to avert its collapse.
President Joe Biden has asked Congress to hold bank executives accountable when their banks fail and enter Federal Deposit Insurance Corporation (FDIC) receivership.
He said when banks fail because of mismanagement and excessive risk taking, regulators should cut executives’ compensation, impose civil penalties, and ban them from working in the banking industry again.
The president added Congress should expand FDIC’s authority to impose penalties on negligent executives. Currently, the FDIC can only impose financial penalties on bank executives who recklessly engage in a pattern of unsafe or unsound practices.
Meanwhile, Silicon Valley Bank’s (SVB) parent company, SVB Financial Group, has filed for bankruptcy protection.
To control the crisis triggered by SVB and Signature Bank’s collapse, the Federal Reserve Bank and JPMorgan Chase & Co. have given First Republic Bank access of up to $70 billion in liquidity. 12 other U.S. banks have also announced they will inject $30 billion into First Republic.
Media Coverage (8)
- Al Jazeera
- Biden urges ‘accountability’ for executives of failed banks
- Associated Press
- Biden calls for tougher penalties for execs of failed banks
- Biden asks Congress for tougher laws to hold bank execs accountable
- Biden faces massive political risks from banking turmoil
- Biden takes aim at failed bank executives’ pay, asks Congress to act
- United Press International
- Biden urges expanded FDIC authority over executive mismanagement in banking
- Wall Street Journal
- Biden Asks Congress for More Authority to Punish Bank Executives
- Washington Post
- Biden asks Congress to impose tougher penalties on executives of failed banks