Federal Reserve Chair Jerome Powell affirmed confidence in the bank sector on Wednesday and stated that the recent failure of some regional banks could slow the economy. Powell stated that the banking system was “sound and resilient” and that the central bank was closely monitoring the availability of credit for consumers and businesses. Powell’s comments came after the Silicon Valley Bank collapsed, which was the second-largest bank failure in U.S. history. The devaluation of the bank's bond portfolio due to the sudden rise in interest rates resulted in significant paper losses. Powell remarked that SVB’s management “failed badly in managing those interest rate risks. Banks similar to SVB, such as First Republic ($FRC@US) and PacWest ($PACW@US), have experienced an alarming outflow of deposits. The Fed’s new Bank Term Funding Program allows banks to access cash for uninsured deposits. According to Powell, deposit flows have remained stable in the past week, and Americans can trust that their funds are secure.