The Federal Reserve announced an emergency lending facility on Sunday to shore up the US banking system after the implosion of Silicon Valley Bank sparked fears of contagion.
In a statement, the Fed said it would provide additional funding to eligible depository institutions to “help ensure banks have the ability to meet the needs of all depositors” and “are prepared to deal with potential liquidity pressures”.
He added: “This action will increase the capacity of the banking system to maintain deposits and ensure the supply of money and credit to the economy.”
In a joint statement issued along with the new credit facility, the Bank’s Term Funding Program, Treasury secretary Janet Yellen, Fed chairman Jay Powell and Martin Gruenberg of the Federal Deposit Insurance Corporation said that all depositors of Silicon Valley Bank will have access to money on Monday.
All depositors of Signature Bank, which they say has been closed, will also pay in full.