Michael Barr, Governor of the Federal Reserve, is responsible for supervising the banks. WIN MCNAMEE/Getty Images via AFP
DECRYPTION – US regulators are learning the first lessons from the bankruptcies of medium-sized banks. Blaming management errors, they plead for a tightening of the rules.
Pending a full report on the causes of regional bank failures, promised for May 1, US regulators summoned before the Senate Banking Committee presented their first conclusions. Michael Barr, Governor of the Federal Reserve, responsible for supervising banks, considers that Silicon Valley Bank (SVB) is a “textbook case” of management failure. The repeated and specific warnings from experts at the San Francisco Fed, who have been going through its accounts since 2021, have hardly been followed up.
For his part, Martin Gruenberg, head of the federal agency that guarantees bank deposits (FDIC), recognizes that the bankruptcies of SVB and Signature Bank demonstrate that the financial stability of the United States may be affected by problems from banks “medium” whose total assets were between 100 and 200 billion dollars.
Read alsoRegulators learn early lessons from ‘medium bank’ bankruptcies
His observation, shared by the Fed and the Treasury, changes the debate on the nature of supervision…
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