Both the FDIC and the Fed have announced statements on the matter, which are expected to be released on May 1. (Photo: Getty Images)
The bankruptcy of Silicon Valley Bank (SVB) demonstrates that “our regulatory system has failed,” US Federal Reserve (Fed) Vice Chairman Michael Barr admitted on Wednesday during a hearing before the House of Representatives.
“I think we’ve gone bankrupt every time we’ve seen it, which means management (the bank, editor’s note) has failed, supervisors have failed and our regulatory system has failed,” he declared. Before US elected officials, Mr. see
Martin Grunberg, chairman of the FDIC, the agency responsible for guaranteeing bank deposits, assessed that “we share responsibility” for the bankruptcy.
“I think the management of the bank has their responsibility, but I think it’s ours as the regulator of this company,” Mr. Grunberg added.
Regarding the possible change in the rules for regulating banks, Mr. Bar considered. It is necessary to strengthen them.
After the financial crisis of 2008-2009, wide-ranging international banking sector reforms called “Basel III” were launched to strengthen the strength of banks. Many steps have been taken, but some reforms still need to be finalized, especially in the United States.
“I think the scale-based approach makes sense, not all banks need to have the same rules. But we need stricter rules for companies of this size, especially around capital and liquidity,” said Michael Barr.
He had, earlier in the day, been questioned by a Senate committee and termed SVB’s blunder as a “textbook case of mismanagement” on the part of the company’s management.
Both the FDIC and the Fed have announced statements on the matter, which are expected to be released on May 1.
As he did in the Senate, Mr. Barr explained.
“It is a failure of the regulator not to take into account the comments that you refer to the management of a bank, you are not managing an advisory framework, but a regulatory framework that requires banks to follow this advice,” said Brad Sherman, one of the elected officials during the investigation.
“Certified food fanatic. Extreme internet guru. Gamer. Evil beeraholic. Zombie ninja. Problem solver. Unapologetic alcohol lover.”
A mysterious green fireball streaks the sky in Australia
USA: Vice President Kamala Harris scares US Republicans
Australia | A marine park on the scale of Spain