The collapse of Silicon Valley Bank and Signature Bank in March shows that more oversight of midsize lenders is needed, Federal Reserve Chair Jerome Powell told lawmakers in his semi-annual testimony.
While banking stress occurred in the fallout of the SVB and Signature failures, the Fed Chair reiterated that “the U.S. banking system is sound and resilient.” At the same time, the turmoil that unfolded earlier this year highlights the importance of maintaining a set of “appropriate rules and supervisory practices” for banks similar in size to SVB and Signature.
“The recent bank failures, including the failure of Silicon Valley Bank, and the resulting banking stress have highlighted the importance of ensuring we have the appropriate rules and supervisory practices for banks of this size,” said Powell….