Amidst the recent banking crises in Silicon Valley Bank, Signature Bank, Credit Suisse and First Republic, questions are being raised about the security of deposits. Lloyd Blankfein, the former CEO of Goldman Sachs, stated that the answer cannot be given in black and white terms but that the Federal Reserve, Federal Deposit Insurance Corporation and Treasury Department have the power to safeguard deposits bank by bank if they deem it necessary. Experts advise not to panic and withdraw money, instead making sure the bank is FDIC insured with each deposit account insured up to $250,000. Blankfein further noted that banks are better capitalized due to reforms after 2008 and that the current model of banking will cause most Americans to feel safest with too-big-to-fail banks. Lastly, he commented on Federal Reserve Chair Jerome Powell’s decision to raise interest rates, noting that it would be okay to stop at a 0.25% raise.
Former Goldman Sachs CEO discusses safety of money after bank collapses