Committee Republicans Demand Information from Banking Regulators, Advance Efforts to Get to the Bottom of Recent Bank Failures
Letters to Treasury and FDIC officials are the latest in Committee Republicans’ efforts to get to the bottom of the banking turmoil
Washington,
April 27, 2023 -
Ahead of upcoming reports from the Government Accountability Office (GAO) and federal banking regulators, Committee Republicans sent letters to Treasury Secretary Janet Yellen, Acting Inspector General of the Treasury Richard Delmar, and Federal Deposit Insurance Corporation (FDIC) Chairman Martin Gruenberg demanding additional information regarding the supervisory efforts of their agencies surrounding recent bank failures. This slate of letters builds upon lawmakers’ extensive efforts to get answers from regulators on the collapse of Silicon Valley Bank and Signature Bank.
More on Committee Republicans’ latest letters to Treasury and FDIC officials:
On April 26, the Chairman of the House Financial Services Committee, Patrick McHenry (NC-10), along with Oversight and Investigations Subcommittee Chairman Bill Huizenga (MI-04) and Financial Institutions and Monetary Policy Subcommittee Chairman Andy Barr (KY-06), sent a letter to Treasury Secretary Yellen in her capacity as Chair of the Financial Stability Oversight Council (FSOC) demanding FSOC provide information previously requested by the Committee over a month ago from Council meetings immediately following the collapse of SVB.
On April 24, Subcommittee Chairman Barr sent a letter to Inspector General Delmar demanding still-absent information regarding the Treasury’s determination to take extraordinary action in response to threats to the stability of the United States Financial System, particularly the determination of the failures to be “systemically important.”
On April 24, Subcommittee Chairman Barr sent a letter to Inspector General Delmar in his capacity as Chair of the Council of Inspectors General on Financial Oversight (CIGFO) requesting that CIGFO convene a working group to review and evaluate the effectiveness and internal operations of FSOC surrounding the failures of SVB and Signature Bank.
On April 24, Subcommittee Chairman Barr sent a letter to Chair Gruenberg requesting a full readout of BlackRock Financial Market Advisory’s (BR-FMA) acquisition of SVB and Signature Bank securities held in FDIC receivership.
More information on all prior correspondence to banking regulators following recent failures can be found below:
On March 23, Subcommittee Chairmen Barr and Huizenga, along with Congresswoman Young Kim (CA-40), sent a letter to Vice Chair for Supervision of the Board of Governors of the Federal Reserve System (FRB) Michael Barr and President and CEO of the Federal Reserve Bank of San Francisco (FRBSF) Mary Daly expressing concern about supervisory activity conducted prior to the collapse of Silicon Valley Bank (SVB). In the letter, the lawmakers specifically demanded all communications between the FRB and FRBSF, along with the regulators’ communications with SVB and SVB Financial Group regarding supervisory determinations and regulatory red flags, among other requests.
On March 23, Subcommittee Chairmen Barr and Huizenga sent letters to FSOC Chair Yellen and Chair of the Council of Inspectors General on Financial Oversight, Richard Delmar, demanding greater transparency regarding a March 12 meeting of FSOC that focused on the recent turbulence in the banking system. In the letters, Subcommittee Chairmen Huizenga and Barr requested unredacted minutes of the March 12 meeting in addition to a record of all votes taken, among other information.
On March 23, Subcommittee Chairmen Barr and Huizenga, along with Congresswoman Kim, led a letter to Commissioner Clothilde Hewlett of the California Department of Financial Protection and Innovation (CDFPI) demanding the California regulator provide information regarding its supervisory efforts, coordination with federal regulators, and decision making regarding the failed banks.
On March 23, Subcommittee Chairmen Barr and Huizenga, along with Congressman Andrew Garbarino (NY-02) and Congressman Mike Lawler (NY-17), led a letter to Superintendent Adrienne Harris of the New York Department of Financial Services (NYDFS) demanding the New York regulator provide information regarding its supervisory efforts, coordination with federal regulators, and decision making regarding the failed banks.
On March 22, Chairman McHenry and the Vice Chairman of the House Financial Services Committee, French Hill (AR-02), sent letters to FDIC Chair Martin Gruenberg and Treasury Secretary Janet Yellen. In the letters, Chairman McHenry and Vice Chairman Hill demanded detailed information regarding the Biden Administration’s response to recent bank failures, particularly regarding whether there was a viable private sector option for SVB and Signature Bank.
On March 20, Chairman McHenry and the Ranking Member of the Senate Committee on Banking, Housing, and Urban Affairs, Tim Scott (R-S.C.), formally demanded information from the Fed and the FDIC regarding their regulatory activities with respect to SVB and Signature Bank for the two years leading up to the collapse of the two banks. The top Republicans also requested the Federal Reserve and FDIC preserve all records, future and existing, related to this matter.
On March 17, Chairman McHenry and Ranking Member Maxine Waters (CA-43) sent a letter to the Government Accountability Office (GAO) calling on the agency to study and examine the recent collapse of SVB and Signature Bank. Specifically, the lawmakers urged the office to examine the factors that led to mismanagement of both banks, including any regulatory or examination failures.
###
