(Adds quotes, details on financial stability council)
By David Lawder
NEW HAVEN, Conn., April 3 (Reuters) - U.S. Treasury
Secretary Janet Yellen on Monday said deposit outflows from
small and medium-sized banks were diminishing, but she was
watching the situation closely and was "not willing to allow
contagious runs to develop" in the U.S. banking system.
Yellen told reporters after an event at Yale University that
confidence in the banking system was strengthened by actions
taken by the Treasury, Federal Reserve and Federal Deposit
Insurance Corp after the failures of Silicon Valley Bank and
Signature Bank.
"My read is that outflows from smaller and medium-sized
banks are diminishing, and matters are stabilizing, but it's a
situation we're watching very closely," Yellen said.
Asked whether the Financial Stability Oversight Council, the
multi-regulator body charged with curbing systemic risks, had
spent too much time on assessing risks of climate change and
missed problems that led to the failures of Silicon Valley and
Signature, Yellen disagreed, saying the body studies all
potential financial risks.
"We've focused on a range of issues including financial,
risks and have not put all of our focus on climate risks," she
said, adding that the body had also identified interest rate
mismatches as a potential risk.
"I don't think there's a fundamental problem with the
banking system," she added.
(Reporting by David Lawder; Editing by Mark Porter and Sonali
Paul)
david.lawder.thomsonreuters.com@reuters.net))
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