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Fed Chair Powell Asked About Oversight and Regulation Following SVB

FED
  • Q: Can you talk about oversight as SVB and whether regulation needs to be overhauled? Can Americans have confidence there aren't other ones in the system that you've missed?
    • A: SVB management failed badly. They grew quickly with exposure to significant liquidity and interest rate risk, and didn't hedge. SVB experienced an unprecedentedly rapid and massive bank run.
    • We're doing a review of supervision and regulation. How did this happen is the question, and what went wrong. Make an assessment of policies to put in place, and implement them.
    • These are not weaknesses broadly through the banking system - it was an outlier in terms of uninsured deposits and holdings of duration risk. Supervisors were on the issue but this still happened.

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