First Citizens to acquire Silicon Valley Bank: FDIC news hits as regulators questioned by Congress
First Citizens will acquire the collapsed Silicon Valley Bank as lawmakers set out to examine the recent string of bank failures prompted by the tech-focused financial institution’s failure earlier this month.
Both the Senate and House will hold hearings this week to investigate federal regulators’ response to the recent bank failures and what led to the biggest bank crises since 2008.
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When are the hearings and who is testifying?
Martin Gruenberg, Federal Deposit Insurance Corporation board of directors’ chairman
Michael Barr, Federal Reserve vice chair
Nellie Liang, treasury undersecretary for domestic finance
Gruenberg, Barr and Liang will first testify in front of the Senate Banking, Housing and Urban Affairs Committee at 10 a.m. Tuesday and then in front of the House Financial Services Committee at 10 a.m. Wednesday.
Why does this matter?
The failure of SVB and Signature Bank is the biggest bank crises since 2008 – the nation’s worst financial crisis since the Great Depression – and the threat that its collapse could spread to other financial institutions prompted the Biden administration to intervene.
Both hearings are set to examine the recent bank failures and federal regulators’ response.
SVB collapse aftermath: Biden, Democratic National Committee will return political donations from Silicon Valley Bank executives
What are lawmakers saying?
Following the collapse, President Joe Biden called on Congress to expand the government’s capacity to hold executives accountable and impose tougher penalties for bank failures. While the FDIC, the Securities and Exchange Commission and Justice Department have the authority to investigate what led to these bank failures, Biden is asking for increased federal oversight on senior banking executives.
Sen. Elizabeth Warren, D-Mass., blamed Federal Reserve Chair Jerome Powell for the banking crisis following SVB's collapse
"As Chair of the Fed, you have led and vigorously supported efforts to weaken the regulations that would have subjected banks like SVB and Signature to stronger, liquidity requirements, more robust stress testing, and routine resolution planning obligations," Warren wrote in a 10-page letter to Powell.
"Make no mistake: your decisions aided and abetted this bank failure, and you bear your share of responsibility for it," Warren added.
This article originally appeared on USA TODAY: First Citizens to acquire SVB: FDIC news hits as regulators questioned