In a rare show of consensus, congressional lawmakers from both parties said Sunday they would oppose any potential bailout option for Silicon Valley Bank, which collapsed on Friday in the biggest bank failure since the 2008 financial crisis.
Treasury Secretary Janet Yellen ruled out a bailout possibility for the bank’s owners and investors, and members of Congress on both sides of the aisle piled in to say it wouldn’t be the right move for face the second largest bank failure in the country. history.
“Let me make it clear that during the financial crisis there were investors and owners of large systemic banks that were bailed out…and the reforms that have been put in place mean we’re not going to do that again,” he said. said Yellen in an interview with CBS’ “Face The Nation.”
Regulators closed the bank on Friday over concerns about its solvency as customers withdrew their funds. Federal authorities are reportedly looking for ways to protect uninsured bank deposits to avoid panic in the hours before the first markets open in Asia, The Washington Post reported.
Democratic Sen. Bob Menendez (NJ) said on NBC’s “Meet the Press” that he was “not ready” to offer Silicon Valley Bank a bailout “by any stretch of the imagination.”
“We have to see exactly everything that is relevant to the specific set of circumstances and see what else – if there is anything else – we should be thinking about,” Menendez said.
Republican Rep. Nancy Mace (SC) stressed on CNN’s “State of the Union” that she would not support a bailout “at this time.”
“You know, we can’t keep bailing out private companies, because there are no consequences for their actions. People, when they make mistakes or break the law, need to be held accountable in this country,” Mace said.
“It’s still very early. I don’t even think it’s been 48 hours. But at this time, I would not support a bailout,” the MP said.
Former President Nancy Pelosi (D-California) would have said at an SXSW panel that she doesn’t think “there’s no appetite in this country to bail out a bank” and instead hopes another bank will buy it.
The Wall Street Journal reported on Sunday that regulators are putting the bank up for auction in a bid to reimburse depositors.
Speaker Kevin McCarthy (R-California) said on Fox News’ “Sunday Morning Futures” that he thinks a bigger bank acquiring Silicon Valley Bank is “great potential” and something the administration was considering.
“Silicon Valley Bank has a lot of assets. It’s right where the capital is right now. So it’s interesting for someone to want to buy it. It’s just a timeline of where to go from there. ‘front. And the administration has tools to deal with that,” McCarthy said.
Hairy would have said that there are several potential buyers, but she hasn’t identified them — and that she hopes to see a purchase by tomorrow morning. McCarthy said he hopes the administration will make an announcement on that by tomorrow before U.S. markets open.
“I spoke with the administration, about (Federal Reserve Chairman) Jay Powell and Janet Yellen. They have the tools to handle the current situation. They know the seriousness of the situation and they are working to make an announcement before the markets open,” the president said of the administration. “And hopefully something can be announced today moving forward.”
The Hill has contacted the White House for comment.
Rep. Michael McCaul (R-Texas), whose home state hosts the South by Southwest tech festival, said on CBS’ “Face the Nation” that he hopes the bank’s failure was “an isolated event “.
“We want to make sure this is an isolated event, not a systemic event that could impact things like in 2008 when we bailed out the financial sector,” he said. declared.
Sen. Mark Warner (D-Va.) meanwhile said he was waiting to see what decisions, if any, were made by Sunday before deciding.
“There’s generally been a feeling that, you know, the officials, the shareholders of the bank should lose their money,” Warner said on ABC’s “This Week.” “Depositors have been a different circumstance, but there are questions around moral hazard. I’m confident the overall system is pretty solid.
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