Fed: Mismanagement, insufficient supervision led to SVB collapse

Federal Reserve Vice Chair for Supervision Michael Barr released findings from the Fed’s review of Silicon Valley Bank’s (SVB) failure. In response to the insights, Barr said the Fed needs to strengthen its supervision and regulation as he attributed regulatory relief and supervisory changes enacted under the Economic Growth, Regulatory Relief, and Consumer Protection Act (S. 2155) as a factor in the collapse.

The report noted at the time of its failure, SVB had 31 unaddressed safe and soundness supervisory warnings – triple the average number of peer banks.

The report identified four main factors:

• SVB’s board of directors and management failed to manage their risks;

 

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