WASHINGTON (Nexstar) – First Republic Bank was seized by regulators early Monday, marking the third bank failure in 2023 and the second-largest bank failure in U.S. history.

President Biden is trying to reassure Americans that the U.S. banking system is strong but at the same time, the administration says more action is needed to safeguard the banking industry.

Government regulators stepped in by taking control of First republic bank and quickly selling off most of its assets to JP Morgan Chase. As part of the deal, the FDIC provided $50 billion dollars in financing to Chase.

“These actions are going to make sure the banking system is safe and sound and that includes protecting small businesses across the country who need to make payroll for workers and their small businesses,” President Biden said.

While the Biden administration says all is well with the U.S. banking system, First Republic is the largest bank to fail since the 2008 financial crisis. Rules that were put into place after that crisis have since been weakened by Congress.

“The banking system overall is in stable shape,” said National Economic Council Deputy Director Bharat Ramamurti. “The president’s been clear that he is supportive or reinstating a lot of the rules on these large regional banks, that were rolled back in the previous administration.”

However, Ej Antoni with the conservative Heritage Foundation says the regulations won’t fix the problem and instead says the blame lies elsewhere.

“The systemic interest rate risk, that the Fed created within the banking system is causing the house of cards to collapse,” Antoni said.

The Heritage Foundation says interest rates were kept too low for too long during the height of the pandemic, and the assets banks bought are now worthless.

Interest rates were kept low during the pandemic to prevent the entire economy from collapsing since many businesses were closed and many people were unemployed. One of the only ways that individuals and businesses could stay afloat was by borrowing money at a low-interest rate.