An outside review commissioned by the Federal Reserve found that Fed staff knew or should have known Silicon Valley Bank was vulnerable before its March 2023 failure, according to Vice Chair Michelle Bowman. The report, conducted by consulting firm Starling Advisory Group, contradicts an earlier internal review by Fed Governor Michael Barr that blamed regulatory standard changes, instead attributing supervisory failures to staff awareness of risks.
An outside review commissioned by the Federal Reserve found that Fed staff knew or should have known Silicon Valley Bank was vulnerable before its March 2023 collapse, according to Vice Chair Michelle Bowman. The bank experienced a run after disclosing $1.8 billion in securities losses, with 94% of deposits uninsured and concentrated in venture capital–backed tech companies. The findings raise questions about the Fed's prior oversight and may prompt scrutiny of former Supervision Vice Chair Michael Barr's role.
U.S. stock futures were little changed Friday after Thursday's rally following the Federal Reserve's first rate hike in three years. Asian markets posted mixed gains, while U.S. markets recovered from Wednesday's post-Fed decline as investors focused on artificial intelligence-driven profit growth despite higher rate prospects.