Governor Hochul: "Our view was to make sure that the entire banking community here in New York was stable, that we can project calm, that this is a time when we could manage a certain narrow situation and to make sure that that did not get any worse and that was what our objectives were."
Hochul: "Small businesses overall [are] the lifeblood of our city and our state, and we wanted to make sure that they also, again, had the confidence to know that their deposits and their ability to make payroll were protected."
Earlier today, Governor Kathy Hochul provided an update on Signature Bank and the steps her administration has taken to protect depositors in New York State.
VIDEO of the event is available on YouTube here and in TV quality (h.264, mp4) format here.
AUDIO of the event is available here.
PHOTOS of the event are available on the Governor's Flickr page.
A rush transcript of the Governor's remarks is available below:
Good morning, everyone. This morning, I wanted to update New Yorkers on what's been happening over the weekend with the banking sector. We're going to take questions at the end, but this situation is very much still developing, and there may be some questions we're unable to answer. I just want to preface by saying that at the out front.
But I wanted to make sure that the public is up to speed on everything that we know and what has transpired over a very tumultuous weekend. I'm joined by Adrienne Harris, the Department of Financial Services Superintendent, who has done an extraordinary job from the very beginning but had a chance to see her in action this weekend as we sat together last night down in the offices overlooking Wall Street and realizing that we had reached a turning point in a situation that really was quite volatile up until we received some resolution out of Washington. We'll talk about that in a second.
But I want to thank her for drawing on her years of experience working in Washington, working at the Treasury Department, working at the White House, and now being the top regulator for New York State. So, Superintendent Harris, I want to applaud you once again for everything you are doing on behalf of New Yorkers.
Karen Persichilli Keogh, the Secretary of the Governor, has joined us, as well as Liz Fine, Counsel of the Governor. These are just a few of the team members who worked tirelessly throughout this weekend. We spent hours on the phone, myself calling the White House, the Superintendent speaking to everyone at the Federal Reserve, the Treasury Department, FDIC, and all the financial institutions that were very much concerned about what was transpiring. And also a lot of business leaders - we spoke to business leaders from the Partnership, we spoke to the New York Business Council, we spoke to people at REBNY and ABNY and making sure that everyone knew in real time what was going on.
So where do we stand? As you know, the New York State Department of Financial Services took possession of a New York Chartered bank known as Signature last night. While that sounds extraordinary, that is what happens in terms of the transition from a temporary hold by the state, and it's immediately turned over to the FDIC, the department appointed the FDIC to run the day-to-day operations, and this all is in the aftermath of what happened.
We saw on Friday this unfolding with Silicon Valley Bank out in California, and this had an effect on a bank here, in particular, Signature Bank. And the Superintendent explained what happened here, but our view was to make sure that the entire banking community here in New York was stable, that we can project calm, that this is a time when we could manage a certain narrow situation and to make sure that that did not get any worse and that was what our objectives were. So, what the Federal Reserve and the FDIC did this weekend was important. They invoke powers that were conferred to them to create a stop gap situation to give out the message to all depositors that their deposits, even above the $250,000 limit, which is in the law with FDIC protections, that those above that would also be protected. And what this did sent a ripple across the states - and also the country - that deposits would be protected, and that was important for people to hear.
And having not just Silicon Valley Bank, but also Signature Bank on the list when these decisions are made in Washington yesterday was what we had really pushed hard for all weekend long to ensure that the same protections afforded the depositors at Silicon Valley Bank would also be afforded to the businesses and the families and the small town shops and everyone else who does business at Signature Bank to make sure that they knew they were protected as well.
I'm very grateful to the Biden Administration for their swift action. We were in communication all weekend long. They understood the need that we had here in New York to ensure that Signature Bank was also on the list of those that received these additional protections because they saw that a run on a regional bank could pose a great risk to our stability.
This was what the level of concern was over the weekend, that people this morning waking up and deciding to take their money out of a bank because of uncertainty could lead others to flee regional banks, and that would create incredible instability in a sector of the banking community that we think is particularly important. And that would've had large ripple effects throughout the economy, because these banks do hold deposits from small businesses and consumers, including those in the innovation economy, which is critically important to our lifecycle here in New York State.
Small businesses overall, the lifeblood of our city and our state, and we wanted to make sure that they also, again, had the confidence to know that their deposits and their ability to make payroll were protected.
So, we decided it was important to do whatever we could to protect them from customers of Signature Bank, particularly those who had uninsured deposits, to know that they would be protected. So that's what the President reinforced a short time ago and we want to make sure everyone knows, the bank branches are open today.
This was even an area that could have been in doubt over the weekend, if again, we were not successful in persuading the federal government to include Signature and all of its customers in its protection. So, the banks are open. Everything is fine, calm. Now the FDIC is in charge of the bank, and they'll be communicating any further details about the future.
But basically, the management has changed. This was important that this is not a bailout of government taxpayer dollars. This is simply using fees that are assessed on all banks by the FDIC in such a time they would need them. So that money is there. It is not from the taxpayers, but also now there's new leadership.
So, this is not continuing the existing leadership that led the bank into the situation it's in. It is bringing a new flesh, fresh blood, as well as hopefully a potential acquisition, that will be working forward as well. This is an unusual circumstance, but the main message I want to deliver is that New Yorkers should have confidence that their money is secure.
And wherever they've chosen to bank that that is protected. And we wanted to come out here this morning because they deserve that confidence and let them know that they should continue maintaining that level of confidence that the banking industry in our state is strong. It is on solid footing and the actions taken yesterday by the federal government and quickly implemented by our superintendent will go along way toward bolstering that.
I am grateful to the countless partners we had in the federal government who acted so thoughtfully and responded so quickly. I'm grateful to the men and women of New York, the entrepreneurs who continue to build here, who have faith and confidence in our systems, and the companies who employ so many workers and all of those who are keeping our state's economy so strong.
I want them to know once again, despite the jitters over the weekend, this is Monday, the banks are open, the assets are protected, the deposits are protected, and a lot of that was the result of the work done by our Superintendent to make sure that we are looking out for our New York family here.
So, Superintendent, I'll turn it over to you and then we'll take a few questions.