US Senator Bill Hagerty pressed a watchdog to investigate a top banking regulator’s attempts to find a buyer for failed lender Silicon Valley Bank.
(Bloomberg) — US Senator Bill Hagerty pressed a watchdog to investigate a top banking regulator’s attempts to find a buyer for failed lender Silicon Valley Bank.
Hagerty, a Republican member of the powerful Senate Banking committee, says he’s concerned that the Federal Deposit Insurance Corp. might have “intentionally frustrated available methods” of resolving the bank in a way that would lower taxpayer costs. He sent the letter to the agency’s inspector general on Thursday.
He cited media reports that the FDIC moved slowly to start the bidding process over the weekend — before the regulators on Sunday invoked a so-called systemic-risk exception for both Silicon Valley Bank and Signature Bank. Though the FDIC is required to resolve a bank at the lowest cost, the move gives the agency more leeway.
“Any slow-walking of the acquisition evaluation and approval process would obviously limit or even eliminate the effectiveness of that solution in reducing market panic,” Hagerty wrote.
An FDIC representative declined to comment. The agency’s inspector general didn’t immediately respond to a request for comment.
In their joint statement Sunday, the Federal Reserve, FDIC and Treasury Department said in a joint statement Sunday that all depositors would be made whole but “no losses will be borne by the taxpayer.”
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