IBA: Illinois Banks Remain Well-Positioned To Serve Our State
Over the weekend, the IBA was in contact with state regulators, congressional offices, and state lawmakers to discuss the evolving situation regarding Silicon Valley Bank and other troubled institutions. We have stressed the following:
- Illinois banks and thrifts remain well-capitalized and have diverse portfolios of assets and deposits. Illinois depositors should feel secure in keeping their money in our federally-insured banks and thrifts.
- All depositors, insured and uninsured, in the recent failed banks are being made whole and have full and immediate access to their accounts (as of today).
- Federal regulators have established a new credit facility to prevent further liquidity issues. Taxpayers will bear no losses from this temporary program, or from the recent failures.
President Biden Remarks on Bank Failures
President Biden this morning provided an overview of the federal government’s actions following the closures of several institutions. Biden said the banking system is safe, and he praised his banking regulatory team for its quick action. He stressed that all depositors will have access to deposits, that banking regulators have set up procedures to prevent systemic failure, and that losses would “not be borne by the taxpayers.” Watch President Biden’s remarks.
Talking Points for Your Customers and Community
Many banks are probably fielding questions from customers. Below are several talking points that you may use for your customers, employees, and media. You may also refer general media inquiries to the Illinois Bankers Association by emailing firstname.lastname@example.org.
- The banking system is safe, and so are your deposits at our bank. They are protected by the federal government’s deposit insurance, and further bolstered by the resilience of our bank.
- Our bank has a very different profile than the banks that failed. We are a local bank, we are well capitalized, and we are open for business to serve our customers and community.
- Our team is here to answer your questions at your local branch. We stand ready to assist you at all times with any of your questions or concerns.
- Federal deposit insurance protects your money up to $250,000, and over the weekend, federal regulators have stated that no depositors, whether insured or uninsured, will lose money in the recent failures.
- For more information on deposit protections, see the following:
Fed Creates New Loan Fund to Support Bank Liquidity, Boost Confidence
On Sunday night, federal regulators announced actions to support bank liquidity and address consumer confidence. Treasury Secretary Yellen approved policy actions to complete the resolution of Silicon Valley Bank. All depositors will have access to their money starting today. The agencies announced “a similar systemic risk exception” for Signature Bank of New York.
The banking agencies announced that “any losses to the Deposit Insurance Fund to support uninsured depositors will be recovered by a special assessment on banks, as required by law.” Regulators reinforced that “the U.S. banking system remains resilient and on a solid foundation.”
The Federal Reserve has also created a new Bank Term Funding Program. The program will offer loans of up to one year to eligible depository institutions, with U.S. Treasuries, agency debt and mortgage-backed securities and other qualifying assets posted as collateral and valued at par.
Read the interagency statement.
Read the Fed statement.
View the Bank Term Funding Program term sheet.
FHLB of Chicago Provides Customer Statement Regarding Liquidity
The Federal Home Loan Bank of Chicago released a statement this morning to its members, reinstating that the FHLBChicago is “ready and committed to fulfill our mission of being a stable and reliable source of liquidity to our members.” The statement also provides tips for members on accessing liquidity through the bank.