U.S. will keep using tools to prevent banking contagion as needed

WASHINGTON (Reuters) – The U.S. government will continue using its tools to prevent contagion in the banking sector, as warranted, to ensure Americans’ deposits are safe, Treasury Undersecretary for Domestic Finance Nellie Liang will tell the U.S. Congress on Tuesday.

In testimony prepared for the Senate Banking Committee, Liang said decisive action taken by the federal government had worked to restore public confidence, protect depositors and bolster liquidity in the banking system.

“We continue to closely monitor developments across the banking and financial system,” Liang said in the remarks. “As Secretary (Janet) Yellen has said, we have used important tools to act quickly to prevent contagion. And they are tools we would use again if warranted to ensure that Americans’ deposits are safe.”