The Federal Reserve blamed last month\u0027s collapse of Silicon Valley Bank on poor management, watered\u002Ddown regulations and lax oversight by its own staffers
But the FDIC found its own regulatory deficiencies, notably insufficient staffing to adequately supervise Signature Bank, which was based in New York. The agency also took a light-handed approach to regulation, the report found.
“While higher supervisory and regulatory requirements may not have prevented the firm’s failure, they would likely have bolstered the resilience of Silicon Valley Bank,” the report said.Article content Alexa Philo, a former bank examiner for the Federal Reserve Bank of New York and senior policy analyst at Americans for Financial Reform, said the Fed could adopt stricter rules on its own, without relying on Congress.
The Fed’s report, which includes the release of internal reports and Fed communications, is a rare look into how the central bank supervises individual banks as one of the nation’s bank regulators. Typically such processes are confidential, and rarely seen by the public, but the Fed chose to release these reports to show how the bank was managed up to its failure.Article content
Silicon Valley Bank was the go-to bank for venture capital firms and technology start-ups for years, but failed spectacularly in March, setting off a crisis of confidence for the banking industry. Federal regulators seized Silicon Valley Bank on March 10 after customers withdrew tens of billions of dollars in deposits in a matter of hours.
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