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Biden assures secure banking system Amid two banks collapse - Here's what you need to know

US President Joe Biden delivered a reassuring message to Americans on Monday that the country's banking system is secure, even as two banks, California-based Silicon Valley Bank and New York-based Signature Bank, collapsed due to a rise in interest rates.

While all customers will have immediate access to their deposits, investors in these banks will not be protected, and managers will be fired. Depositors' money will be safe as it will be covered by funds banks routinely pay into a US government-held account for emergencies. However, financial experts warn that the US banking industry reported $620 billion in paper losses caused by rising interest rates at the end of last year, and so customers are being advised to keep a watchful eye on their bank's investments.

The Federal Reserve is also providing other banks access to an emergency lending program to provide additional stability to the wider banking system. The actions taken were prompted by the failure of Silicon Valley Bank, which had about $200 billion in assets, and Signature Bank, which had over $100 billion in assets.

The two banks' failures rank as the second and third largest in US history, respectively.

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