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The Silicon Valley Bank and other recent failures have woken up American regulators to the savage consequences of Bidenomics.

Regulators are now issuing rules requiring smaller institutions to issue debt in order to pay off depositors in a crisis.

All American banks with at least $100 billion in assets would be subject to the new requirement, which makes them hold a layer of long-term debt to absorb losses in the event of a government seizure, according to a joint notice from the Treasury, Office of the Comptroller of the Currency, Federal Reserve and Federal Deposit Insurance Corporation, reported CNBC.

That includes steps to raise levels of long-term debt held by banks, removing a loophole that allowed midsized banks to avoid the recognition of declines in bond holdings, and forcing banks to come up with more robust living wills, or resolution plans that would take effect in the event of a failure.

The point of raising debt levels is so that if regulators need to seize a midsized bank, there is a layer of capital ready to absorb losses before uninsured depositors are threatened.

The requirements will force banks to absorb higher funding costs which will likely be passed onto customers.

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