First Congressional Hearing Into Collapse Of SVB Underway Shortly

The first Congressional hearing into the collapse of Silicon Valley Bank will kick off momentarily with Federal Reserve Vice Chair of Supervision Michael Barr and FDIC Chair Martin Gruenberg providing testimony to the Senate Banking Committee. Livestream: Senate Banking Committee

• Barr will tell the panel that the SVB’s collapse was largely due to a failure of the bank to manage the risk of its liabilities: “SVB’s failure is a textbook case of mismanagement.”
• Barr will argue that intervention from the Fed, the Treasury Department, and the FDIC was essential to prevent contagion: “It appeared that contagion from SVB's failure could be far-reaching and cause damage to the broader banking system.”
• Barr will say that he’s investigating if stricter regulation could have limited the risk to SVB: “Specifically, we are evaluating whether application of more stringent standards would have prompted the bank to better manage the risks that led to its failure.”
• Barr’s full testimony: Barr Testimony
• FDIC Chair Martin Gruenberg will testify that SVB’s collapse will cost the FDIC USD$20 billion and note that the agency will refill the fund via new fees on banks.
• Gruenberg’s full testimony: Gruenberg Testimony