The US House’s top government watchdog committee is asking Federal Reserve Chair Jerome Powell to help its investigation into the failure of Silicon Valley Bank, saying Fed officials are balking at turning over some records.
(Bloomberg) — The US House’s top government watchdog committee is asking Federal Reserve Chair Jerome Powell to help its investigation into the failure of Silicon Valley Bank, saying Fed officials are balking at turning over some records.
In a letter to Powell on Monday, the House Oversight Committee’s Republican chairman James Comer says Fed staff produced some non-public confidential supervisory information but that the panel hasn’t “received any communications responsive to” requests it has made starting in late April.
“We look forward to continuing working with you and your staff so that the Committee can receive a fully responsive production,” Comer and Representative Lisa McClain, chair of the subcommittee on Health Care and Financial Services, wrote to Powell.
There was no immediate response Monday to telephone messages and email requests for comment on the letter from spokesmen at the Fed’s Board of Governors.
The committee disclosed on April 27 that it’s investigating the role played by the San Francisco Fed, led by Mary Daly, and other state and federal regulators in SVB’s collapse. The bank fell into Federal Deposit Insurance Corporation receivership on March 10 in the second-biggest bank failure in US history.
Comer and McClain wrote at the time that the Fed “appears to have failed to adequately supervise SVB and respond to the bank’s mismanagement.” Daly’s office allegedly knew in late 2022 that “almost 96%” of SVB’s deposits were uninsured, making the bank susceptible to a run, they said.
Read more: SVB Mess Festered Under Fed’s Bureaucracy and Feel-Good Culture
In the new letter addressed directly to Powell, Comer and McClain say the San Francisco Fed first responded by producing on May 22 an overview of the Federal Reserve System and a copy of the central bank’s postmortem review of the Fed’s supervision of SVB by Vice Chair of Supervision Michael Barr — information that “was already publicly available,” the two lawmakers said.
San Francisco Fed officials then told committee staffers during a May 25 call that they’d been advised by Powell’s staff “the Fed Board was asserting privilege over a majority of the requested materials,” citing confidentiality of supervisory information.
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