Congress announces March 29 hearing into failures of SVB and Signature Bank

FDIC chair Martin Gruenberg and Fed Vice Chair for Supervision Michael Barr will appear before Congress on March 29 as part of a hearing into the collapse of SVB and Signature.
Turner Wright
Posted by Turner Wright March 17, 2023 2 Mins Read
FDIC chair Martin Gruenberg and Fed Vice Chair for Supervision Michael Barr will appear before Congress on March 29 as part of a hearing into the collapse of SVB and Signature.

Representatives from the Federal Deposit Insurance Corporation and Federal Reserve will be testifying before the United States House Financial Services Commission in a newly announced hearing investigating the collapse of two major banks.

In a March 17 notice, Representatives Maxine Waters and Patrick McHenry — the ranking member and chair of the committee, respectively — said U.S. lawmakers would listen to testimony from federal financial regulators “in response to the failures of Silicon Valley Bank and Signature Bank” in a March 29 hearing. FDIC chair Martin Gruenberg and Fed Vice Chair for Supervision Michael Barr are expected to appear before Congress.

“The House Financial Services Committee is committed to getting to the bottom of the failures of Silicon Valley Bank and Signature Bank,” said Waters and McHenry. “This hearing will allow us to begin to understand why and how these banks failed.”

On March 10, Silicon Valley Bank shuttered following a bank run among major depositors, but the government stepped in to announce most uninsured depositors — those with more than $250,000 — would be covered. In contrast, reports suggested Signature Bank had no issues with solvency at the time of its closure on March 12, but New York regulators stepped in, giving the FDIC control of the firm’s insurance process.

Barr will be releasing a report on the Fed’s supervision and regulation of Silicon Valley Bank. The Department of Justice and Securities and Exchange Commission have also reportedly announced their own probes into some of the bank’s executives selling stock in the weeks leading up to the closure.

Related: US lawmaker suggests Signature’s collapse was tied to instability of crypto

Some lawmakers have pointed to exposure to crypto firms as potential culprits in the downfall of the banks, while advocates in the space have argued that government officials were looking to “de-bank” crypto and blockchain companies. The House Financial Services Committee says it expects to hold multiple hearings on the issue.

Update (March 21 at 6:02 PM UTC): Nellie Liang, Under Secretary for Domestic Finance at the U.S. Treasury Department, has been added to the witness list for the hearing.

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