A week after the second-largest bank collapse in U.S. history, Treasury Secretary Janet Yellen told the Senate Finance Committee on Thursday that the nation’s banking system “remains sound” and Americans “can feel confident” about their deposits.

Her remarks, coming against the backdrop of deepening concerns about the health of the global financial system, were an effort to signal to markets that there would be no broader contagion from the collapse of Silicon Valley Bank in California and Signature Bank in New York.

Facing fierce questioning by lawmakers on how Federal Reserve interest rates contributed to the bank failures and whether taxpayers would bear the brunt of the commitment to make depositors at the banks whole, Yellen stressed the need for the federal government to act to assure stability in the market.

“We certainly need to analyze carefully what happened to trigger these bank failures and examine our rules and supervision” to prevent failures from happening again, Yellen told the committee.

Yellen was the first Biden administration official to face lawmakers over the decision to protect uninsured money at two failed regional banks, a move that some have criticized as a bank “bailout.”

“The government took decisive and forceful actions to strengthen public confidence” in the U.S. banking system, Yellen testified. “I can reassure the members of the committee that our banking system remains sound, and that Americans can feel confident that their deposits will be there when they need them.”

Yellen also defended the government’s argument that taxpayers will not bear the cost of protecting uninsured money at two failed regional banks.

The week has been a whirlwind for markets globally on worries about banks that may be bending under the weight of the fastest set of hikes to interest rates in decades. In Europe, troubles at Credit Suisse, Switzerland’s second-largest lender this week prompted the Swiss central bank to agree to loan Credit Suisse up to 50 billion francs ($54 billion).

In less than a week, Silicon Valley Bank, based in Santa Clara, California, failed after depositors rushed to withdraw money amid anxiety over the bank’s health. Then, regulators convened over the weekend and announced that New York-based Signature Bank also failed. They ensured all depositors, including those holding uninsured funds exceeding $250,000, were protected by federal deposit insurance.

The Justice Department and the Securities and Exchange Commission have since launched investigations into the Silicon Valley Bank collapse.

Thursday’s hearing, meant to address President Joe Biden’s budget proposal, came after the sudden collapse of the nation’s 16th-biggest bank and go-to financial institution for tech entrepreneurs. While lawmakers questioned Yellen on the deficit and upcoming debt ceiling negotiations, many focused instead on what role regulators played in the bank failures.

The Biden administration’s “handling of the economy contributed to this,” insisted Sen. Tim Scott, R-S.C. “I plan to hold the regulators accountable.”

Sen. Mark Warner, D-Va., wondered aloud, “Where were the regulators in all of this?” and called for accountability in the bank run.

“Nerves are certainly frayed at this moment,” said Sen. Ron Wyden, D-Ore., who chairs the committee. “One of the most important steps the Congress can take now is make sure there are no questions about the full faith and credit of the United States,” he said, referring to raising the debt ceiling.

Sen. Mike Crapo of Idaho, the committee’s top Republican, said, “I’m concerned about the precedent of guaranteeing all deposits,” calling the federal rescue action a “moral hazard.”

Yellen said on CBS’ “Face the Nation” last Sunday that a bailout was not on the table, stating, “we’re not going to do that again,” referring to the U.S. government’s response to the 2008 financial crisis, which led to massive government rescue policies to large U.S. banks.

Yellen, a former Federal Reserve chair and past president of the San Francisco Federal Reserve during the 2008 financial crisis, was a leading figure in the resolution this past weekend, which was engineered to prevent a wider systemic problem in the banking sector.

“This week’s actions demonstrate our resolute commitment to ensure that depositors’ savings remain safe,” she said.

Sen. Sherrod Brown, D-Ohio, compared the bank collapse to the rail industry’s lobbying that Democrats say contributed to the East Palestine train derailment that rocked an Ohio community. “We see aggressive lobbying like this from banks as well,” he said.

In Europe, troubles at Credit Suisse, Switzerland’s second-largest lender, have deepened concerns about the global financial system.

Credit Suisse was having issues long before the two U.S. banks collapsed, but the news Wednesday that the bank’s biggest shareholder would not inject more money led shares of European banks to plunge.

On Thursday, the Swiss central bank agreed to loan Credit Suisse up to 50 billion francs ($54 billion), sending its shares soaring.

Regulators are trying to reassure depositors that their money is safe. They “don’t want anybody to be the person who sits in a darkened room or darkened cinema and shouts fire, because that’s what prompts a rush for the exits,” said Russ Mould, investment director at the online investment platform AJ Bell.

Despite the banking turmoil, the European Central Bank hiked interest rates by a half percentage point to try to curb stubbornly high inflation, saying Europe’s banking sector is “resilient,” with strong finances and plenty of available cash.

ECB President Christine Lagarde said the central bank would provide additional support to the banking system if it became necessary. She said banks “are in a completely different position from 2008” because of safeguards added after the financial crisis.

ECB Vice President Luis de Guindos also said Europe’s exposure to Credit Suisse, which is outside the European Union’s banking supervision structure, was “quite limited” and “not concentrated” in any one place.

The Swiss bank, which has seen its stock decline for years, has been pushing to raise money from investors and roll out a new strategy to overcome an array of troubles, including bad bets on hedge funds, repeated shake-ups of its top management and a spying scandal involving Zurich rival UBS.

(AP)