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McHenry Delivers Opening Remarks at Hearing to Continue Oversight of Recent Bank Failures

Washington, May 17 -

Today, the House Financial Services Committee is holding a joint subcommittee hearing to continue its oversight of regional bank failures. Lawmakers from the Subcommittees on Financial Institutions & Monetary Policy and Oversight & Investigations will question two panels of witnesses, including former executives from Silicon Valley Bank (SVB), Signature Bank, and First Republic Bank, as well as state-level regulators that oversaw the failed institutions. 

Committee Republicans will use this opportunity to examine the ways in which both regulators and bank management failed to identify the market pitfalls underlying the collapses and correct course.

Watch Chairman McHenry’s opening remarks here.

Read Chairman McHenry’s opening remarks as prepared for delivery:

“Today we’ll hear three different stories from three different banks. 

“Your business models were not the same. Your depositors were not the same. And the degree of mismanagement was not the same. 

“But the truth is, each of you bears responsibility as the captain of your respective ship. 

“There was a storm brewing and you failed to batten down the hatches.

“And while inflation raged, the Fed and the Biden Administration told us all that it was ‘transitory’ – nothing to worry about. 

“We’ll get into the mismanagement shortly, but maybe one of your mistakes was believing the bureaucrats. 

“As we all know, inflation was not transitory and after being late to respond, the Fed was forced to raise rates at the fastest pace in modern history. 

“Again, you failed to appropriately prepare for this inflationary and high interest rate environment. 

“Mr. Becker, Silicon Valley Bank was the projectile that set this volatility into motion. 

“The Biden Administration used another buzzword to describe SVB—idiosyncratic. 

“Clearly, as there are three of you here today, the problem goes much deeper.

“The subsequent failures of Signature and First Republic Bank, coupled with the volatility in regional bank stocks, sent shockwaves through our financial system. The fear of contagion has rocked an already shaky economy. 

“So, while we’ll hear from each of you and the New York and California regulators today, I think it’s important to take a step back and really examine the undercurrents that caused this crisis. 

“The economic mismanagement by the Biden Administration created the perfect storm and each of you failed to right the ship.”

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