US bank regulators answer senators’ questions on SVB
The US Senate Banking Committee on Tuesday launched leading US banking regulators on the collapse of the Silicon Valley Bank (SVB) and Signature Bank.
“We have to look at the inside of the bank, the Trump-era bank chiefs and the bank regulators who made it their mission to give Wall Street whatever it wants,” committee chair Sherrod Brown said.
The lawmakers are questioning Federal Reserve Vice-Chairman Michael Barr, responsible for banking supervision, as well as officials from the FDIC and the Treasury Department.
After the collapse of the regional banks, the authorities were accused of overly lax supervision. On March 10, the Californian banking supervisory authority closed Silicon Valley Bank and put it under the US deposit insurance fund FDIC.
The constantly increasing liquidity consumption of their customers from the start-up area quickly squeezed the bank’s deposits. To meet liquidity needs, the institution sold a bond portfolio at a loss of $1.8 billion — about the same as the financial group’s net profit for 2021.