Washington – Senator Elizabeth Warren of Massachusetts said Sunday of Congress’ proposal to end the Federal Deposit Insurance Corporation’s (FDIC) deposit insurance program. insurance limit From the current $250,000 limit, it’s a “must consider now” option as lawmakers debate how to respond to the rapid collapse of two banks earlier this month.
“I think the removal of the FDIC’s insurance cap is a good move,” Warren said in an interview with Face the Nation. “The question is where is the right number for lifting? or rely more heavily on regulators to do their job.”
Democratic senators said a key issue for Congress to address is where to set the insurance cap on FDIC deposits.
“Two million dollars? Five million dollars? Ten million dollars?” she said. “Small businesses need to be able to count on money to pay their payroll and to pay their utility bills. Nonprofits need to be able to do that. No, that’s what regulators are supposed to do.”
Warren declined to say whether he was in talks with the White House about plans to increase the FDIC’s insurance level above the $250,000 cap, but said, “That’s one of the options we have to look at now.” rice field.
suddenly Closure of Silicon Valley Bank March 10, followed by The collapse of New York’s signature bank A few days later, federal banking regulators rushed to create a plan to strengthen the banking system and reassure Americans that they could have confidence in their financial system.
as part of The Biden Administration’s Emergency Measures The idea was to make all money accessible to all depositors with an account at Silicon Valley Bank. The Federal Reserve has also established a new lending facility to help financial institutions meet the needs of depositors.
But the failures of two banks have sparked renewed scrutiny from bank regulators, including Federal Reserve Chairman Jerome Powell.
Warren said on Sunday that regulators and executives at these banks should be held accountable, particularly criticizing the Fed and Powell as “dangerous people to put in this position.”
“We need accountability to regulators who have clearly failed their jobs, and it starts with Jerome Powell, and we need accountability to executives at these big financial institutions,” Warren said. “Look, Gary Becker and the others who blew up these banks should have clawbacks.”
The Massachusetts senator also said he doesn’t trust San Francisco Fed President Mary Daly, and went public with Silicon Valley Bank as early as December.
“The Federal Reserve should have acted, but the San Francisco Fed and the Federal Reserve have acted,” she said. “Remember that the Federal Reserve and Jerome Powell are ultimately responsible for the oversight and supervision of these banks, and they say their job is to deregulate these banks. We have now seen the results.”
Warren said Chairman Powell “needs to make a 180-degree turn and monitor these banks more carefully,” and Congress will tighten bank regulation.
“This whole bank tranche has been poorly regulated for five years. I am worried,” she said. “That’s why I’m now calling for a change in the Fed’s regulatory approach and a change in Congress to roll back its power to deregulate.”
Sunday Warren separately I was asked It conducted an independent investigation into bank and regulatory failures and asked Treasury inspectors, the FDIC, and the Federal Reserve to submit preliminary reports to Congress within 30 days.