Treasury, White House: Confident in Regulators Response on Silicon Valley Bank Collapse

WASHINGTON—Treasury Secretary Janet Yellen met with banking regulators on Friday on the collapse of SVB Financial Group as she and the White House expressed confidence in their abilities to respond to the largest bank failure since the 2008 financial crisis.

Yellen met Friday with representatives from the Federal Reserve, the Federal Deposit Insurance Corporation and the Office of the Comptroller of the Currency to discuss developments with SVB. SVB is also known as Silicon Valley Bank. Treasury stated in a statement.

“Secretary Yellen expressed full confidence in banking regulators to take appropriate actions in response and noted that the banking system remains resilient and regulators have effective tools to address this type of event,” It was.

California’s banking regulators closed SVB on Friday, appointing FDIC receiver to protect depositors at startup-focused lender.

After arriving at Santa Clara, Calif.’s shuttered Silicon Valley Bank (SVB), headquarters, an employee takes his place in the car. This was March 10, 2023. (Justin Sullivan/Getty Images)

Cecilia Rouse (Chair of the Council of Economic Advisers) told reporters at White House that the U.S. financial system was fundamentally better and stronger than during the 2008 financial crises. The White House was prepared to use these words by regulators. “better tools” They were created to protect investments.

Rouse claimed that the Federal Deposit Insurance Corp. was quick to intervene to protect deposits as high as $250,000.

“Our banking system is far more resilient than it was in 2008. We’ve learned a lot. We’ve got better tools,” She said.

She pointed out that banks are now required to undergo stress testing and have more capital than they did during the previous crisis.

“We put in guardrails, and our regulators have much visibility into the banking sector than they did a decade ago.”

Yellen gave testimony on Friday, before the U.S. House of Representatives Ways and Means Committee. Yellen was asked questions about SVB’s position and stated: “There are recent developments that concern a few banks that I’m monitoring very carefully. And when banks experience financial losses, it is and should be a matter of concern.”

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