Federal Reserve Loans $12 Billion to US Banks in Wake of Silicon Valley Bank Collapse
Since the collapse of the Silicon Valley bank, the Federal Reserve’s loans to U.S. banks under the program totaled nearly $12 billion amid an attempt to ease pressure on the financial system.
In a statement, the Federal Reserve (the US central bank) announced that the amounts owed under the “Interim Bank Financing Program” had reached $11.9 billion by last Wednesday.
And last Sunday night, the Federal Reserve, in collaboration with the Treasury Department and the Federal Deposit Insurance Corporation, unveiled a loan program to spare other banks the liquidity problems that led to the collapse of Silicon Valley Bank as the program provides additional funding. to “help ensure that banks can meet the needs of all savers.” As stated in the Federal Statement.
For its part, Treasury Secretary Janet Yellen told senators on Thursday that authorities moved quickly to protect depositors at Silicon Valley and Signature banks, which also collapsed after seeing a “serious contagion risk” in the banking sector.
Shares of a number of regional banks, led by the First Republic, fell days after the collapse of the Silicon Valley Bank due to concerns about its long-term financial position, while markets reacted positively after the group announced the opening of 11 largest US banks, including Bank of America, Citigroup, JP Morgan and Goldman Sachs, which invested $30 billion in First Republic on Thursday.
The group said in a statement that its actions reflect “trust in the country’s banking system.”
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