Senate Banking Committee Democrats today asked Treasury Secretary Janet Yellen for an assessment of possible regulatory and legislative changes needed to strengthen the financial system following the failures of Silicon Valley Bank and Signature Bank.
The Federal Reserve is reviewing its capital and liquidity standards for all large banks following the closures of Silicon Valley Bank and Signature Bank, including those with more than $100 billion in assets, Fed Vice Chairman Michael Barr said this week.
During a Senate Banking Committee hearing this week, regulators agreed that rules governing financial institutions should be strengthened to better protect the overall financial system. Several lawmakers questioned, however, whether those same regulators failed to use their existing tools to rein in Silicon Valley Bank.
Top Republicans on the House Financial Services Committee this week called on federal regulators to explain the decision to invoke an emergency systemic risk exception in the failures of the Silicon Valley Bank and Signature Bank.
One area where many lawmakers and bankers can come together is in the belief that everyone should be playing by the same rules, whether it be banking, crypto firms or fintech, Senate Banking Committee Chairman Sherrod Brown (D-Ohio) said this week at the ABA Washington Summit.
In the matter of the Silicon Valley Bank and Signature Bank failures, lawmakers must first gather the facts and determine what allowed both to occur rather than instantly pushing for new regulation, House Financial Services Committee Chairman Patrick McHenry (R-N.C.) said this week the ABA Washington Summit.
There were “missed opportunities” to see what was happening with SVB’s balance sheet and to correct things before collapse, Waters said.
Senate Banking Committee Ranking Member Tim Scott (R-S.C.) said he and Chairman Sherrod Brown (D-Ohio) are in agreement that the SAFE Banking Act “should go through regular order,” rather than rushing it to the floor and risking opposition on procedural grounds during ABA’s Washington Summit.
House Financial Services Committee Chairman Patrick McHenry (R-N.C.) and Senate Banking Committee Ranking Member Tim Scott (R-S.C.) called on the Federal Reserve to provide “a comprehensive timeline of events related to the Federal Reserve’s lending, supervisory, and examination activity for the last two years with regards to [Silicon Valley Bank] and/or Signature Bank.”
The U.S. banking system is sound and Americans can feel confident that their deposits will be there when they need them, Treasury Security Janet Yellen told lawmakers this week.