“Supervisors failed to take forceful enough action,” the Fed document mentioned.
The Federal Reserve failed in its function because the banking trade watchdog in the run up to the collapse of Silicon Valley Bank, the central financial institution mentioned on Friday.
The Fed sharply criticized management at Silicon Valley Bank for “a textbook case of mismanagement,” however the document additionally faulted the Fed’s lax oversight and an incapability to watch for the systemic risk posed by way of the financial institution’s failure.
“Federal Reserve supervisors failed to take forceful enough action,” mentioned Michael Barr, the central financial institution’s vice chair for supervision, who wrote the document. “SVB’s failure demonstrates that there are weaknesses in regulation and supervision that must be addressed.”
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