U.S. authorities raced on Sunday to stem jitters about the health of the nation’s financial system, pledging to fully protect all depositors’ money following the collapse of Silicon Valley Bank while also giving any banks squeezed for cash easier terms on short-term loans.
The Treasury Department, Federal Reserve and Federal Deposit Insurance Corp. jointly announced the efforts aimed at strengthening confidence in the banking system after SVB’s failure spurred concern about spillover effects.
SVB’s collapse into FDIC receivership — the second-largest U.S. bank failure in history behind Washington Mutual in 2008 — came suddenly on Friday, following a frenetic couple of days where its long-established customer base of tech startups yanked deposits. After SVB’s collapse, a number of other regional lenders saw their shares plunge amid concerns about the financial stability of smaller banks.
