U.S. Senators demand answers from Fed about California bank failure

By CAMERON ARCAND THE CENTER SQUARE CONTRIBUTOR

(The Center Square) — A bipartisan group of senators is demanding answers about what led to the collapse of Silicon Valley Bank and what knowledge the federal government may have had about it beforehand.

Sen. Kyrsten Sinema, I-Ariz., and Sen. Thom Tillis, R-N.C., along with numerous other Republican and Democrat senators, said in a letter to Federal Reserve Vice Chair Michael Barr that they are “deeply concerned that regulators may have missed clear warning signs in the lead up to the failure of SVB.”

“It is gravely concerning that retail participants, utilizing only publicly available information, were able to identify clear and compelling examples of financial mismanagement and asset overconcentration at SVB, while the Fed, which can draw even deeper from non-public supervisory information, was unable to ascertain a similar conclusion,” the letter states.

“The fact that the San Francisco Fed, among other regulatory agencies, found no reason to take appropriate regulatory action or even investigate SVB further in the months, weeks, and days prior to the bank’s collapse must be addressed in a manner that restores public confidence in Fed supervision,” they continue.

Silicon Valley Bank failed last week, which resulted in the Federal Deposit Insurance Corporation stepping in to help depositors. The bank was known for supporting the technology sector, and New York officials also decided to shut down Signature Bank shortly afterward. First Republic Bank is also struggling and using other financial institutions for assistance.

“The Fed should review the financing

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