US regulators to consider SVB oversight failures in upcoming reports

Washington: US regulators overseeing Silicon Valley Bank’s rapid collapse earlier this month confirmed Tuesday that they will consider any failings they may have made, in reports to be published by May 1. The Federal Deposit Insurance Corporation will launch an examination of the deposit insurance system in light of the decision by regulators to make uninsured depositors whole after SVB’s collapse, FDIC Chair Michael Gruenberg told the Senate Banking Committee. The findings of a separate review by the Federal Reserve, which was SVB’s primary regulator before it failed earlier this month, will also be published by the same date. “The decision to cover uninsured depositors at these two institutions was a highly consequential one,” Gruenberg said, adding the FDIC would conduct “a comprehensive review” of its deposit insurance system by May 1. By law, the FDIC insures up to $250,000 of customers’ deposits in eligible banks. But regulators took the controversial decision to support SVB and Signature Bank’s uninsured deposits earlier this month, citing fears of contagion. Gruenberg said the FDIC will also conduct a review of the regulatory failings that led to the collapse of Signature Bank in the immediate aftermath of SVB’s failure. The Fed’s separate report, which was announced earlier this month, will include previously “confidential supervisory information,” the US central bank’s vice chair for supervision Michael Barr confirmed to Senators on Tuesday. There would be “no limitations” placed on the staff members conducting the review into “how the Federal Reserve conducted supervision and the regulatory oversight of the firm,” he said. Read all the Latest News , Trending News , Cricket News , Bollywood News , India News and Entertainment News here. Follow us on Facebook, Twitter and Instagram.