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‘Vital for the middle class’: Concerns are growing about US regional banks

View of the New York skyline

For the US economy, medium-sized regional banks play a more important role than the big Wall Street banks.

(photo: ddp/Vichie81)

Denver Joe Biden is in a hurry. The US president wants to regulate medium-sized banks more closely and surprisingly made a number of demands on Thursday that the regulatory authorities must implement.

The Democrat wants to subject institutions with total assets of between $100 billion and $250 billion to annual stress tests. They should increase their liquidity requirements and review the interest rate risk on their balance sheets.

The president’s message is clear: He wants to reverse the deregulation that occurred under his predecessor, Donald Trump. Trump has loosened regulations for medium-sized institutions such as Silicon Valley Bank (SVB), enabling the risky institution strategy that led to its collapse. Biden served as vice president in 2009 in the cleanup business after the bankruptcy of Lehman Brothers and wants to prevent a new banking crisis at all costs.

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