(Washington) Joe Biden believes that “Congress must act to more heavily sanction bank executives whose mismanagement contributed to the failure of their establishments,” according to a statement released Friday.
As the American banking world is rocked by several failures, the president argues that “no one is above the law” and that “toughening up accountability has a significant deterrent effect in preventing future instances of mismanagement.”
Noting that the law today limits the ability of administrative authorities to act, he considers that it should be “easier for regulators” to financially sanction bankers.
Joe Biden therefore asks American parliamentarians to give more power to the regulatory authorities, and in particular to the Deposit Guarantee Agency (FDIC), the body which intervenes in the event of bank failure.
It remains to be seen how his call will be received: the Democratic party, that of Joe Biden, controls the Senate, but the other house of Congress, that of the representatives, is dominated by the Republican opposition.
However, conservatives are generally hostile to any tightening of banking regulation.
Joe Biden’s call to Congress comes after the US banking world was rocked by the collapse of tech-linked Silicon Valley Bank and the debacle of New York-based Signature Bank.
On Thursday, a group of major American banks had to come to the aid of another establishment, First Republic, considered the new weak link in the system.
This rescue did not reassure the markets for long, which were still very feverish on Friday.
