Update: President Biden demands accountability for Silicon Valley Bank failure

MENLO PARK -- While the federal government has stepped in to protect depositors of the failed Silicon Valley Bank, a investigation into how it happened is just beginning.

Over the weekend, President Joe Biden said he wants to know how this failure happened.

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"I am firmly committed to holding those responsible for this mess fully accountable and to continuing our efforts to strengthen oversight and regulation of larger banks so that we are not in this position again," he said in a statement.

He reinforced those sentiments in a national address Tuesday morning.

Mr. Biden reassured Americans that they can have confidence in the U.S. banking system and quelled any concerns about the fallout from its abrupt failure.

"Americans can have confidence that the banking system is safe," Mr. Biden said in brief remarks from the White House. "Your deposits will be there when you need them. Small businesses across the country that deposit accounts at these banks can breathe easier knowing they'll be able to pay their workers and pay their bills, and their hard-working employees can breathe easier as well."

Investors in the banks, however, will not be protected, the president said, and management will be fired.

"They knowingly took a risk, and when the risk didn't pay off, investors lose their money. That's how capitalism works," Mr. Biden said.

The president also called for a "full accounting" of what led to the collapse of Silicon Valley Bank and a second institution, Signature Bank of New York, which was taken over by state regulators Sunday, and how to hold those responsible accountable.

"No one is above the law," Mr. Biden said.

On Monday, the Federal Deposit Insurance Corporation  transferred all deposits—both insured and uninsured—and substantially all assets from SVB to a newly created, full-service FDIC-operated 'bridge bank' in an action designed to protect all depositors

Depositors will have full access to their money beginning Monday morning when the  17 branches of the bank opened for business in both California and Massachusetts and resumes normal banking hours and activities, including online banking. 

Federal officials said all depositors and borrowers will automatically become customers of the new bank and will have customer service and access to their funds by ATM, debit cards, and writing checks. 

On Friday morning, the California Department of Financial Protection and Innovation shut down the bank and appointed the FDIC as the receiver. It was the second largest bank failure in U.S.

By Sunday, both U.S. and British officials took extraordinary steps to stop a potential banking crisis after the historic failure. The UK Treasury and the Bank of England "facilitated the sale″ of Silicon Valley Bank UK to HSBC, ensuring the security of 6.7 billion pounds ($8.1 billion) of deposits.

U.S. regulators also worked all weekend to try to find a buyer for the bank. Those efforts appeared to have failed Sunday. But they have assured all depositors at the failed institution that they could access all their money quickly.

On Monday morning, 17 branches of the bank will open for business in both California and Massachusetts. Depositors will be able to move their funds elsewhere 

Under the plan, depositors at Silicon Valley Bank, including those whose holdings exceed the $250,000 insurance limit, will be able to access their money and move it elsewhere.

In a sign of how fast the financial bleeding was occurring, regulators announced that New York-based Signature Bank had also failed and was being seized on Sunday.

At more than $110 billion in assets, Signature Bank is the third-largest bank failure in U.S. history. Another beleaguered bank, First Republic Bank, announced Sunday that it had bolstered its financial health by gaining access to funding from the Fed and JPMorgan Chase.