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The House Financial Services Committee has scheduled hearings on the collapse of Signature Bank and SVB, which threaten to derail the US financial system.
According to March 17th announcement by the House Financial Services Committee, the first hearing on the sudden collapse of Silicon Valley Bank (SVB) and Signature Bank has been set for March 29.
FDIC board chairman Martin J. Gruenberg and Federal Reserve (VC) deputy chairman Michael S. Barr will testify at the first hearing. More witnesses will be invited, according to the announcement.
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In the announcement, US representatives Maxine Waters and Patrick McHenry noted:
The House Financial Services Committee is committed to investigating the failures of Silicon Valley Bank and Signature Bank. This hearing will allow us to begin to understand why and how these banks fail.
Shortly before the SVB failed, bank executives were given significant bonuses. US president Joe Biden recently asked Congress to ensure financial regulators have the power to reverse compensation awarded to executives at bankrupt banks.
After taking over SBV, The FDIC announced that bank depositors will be fully covered. In contrast, Signature Bank claimed to have no solvency problems at the time of its closure. However, New York’s financial regulator seized the bank’s operations and turned them over to the FDIC.
Several legislators have pointed to the potential link between crypto and banks as the main reason for the collapse. In response, crypto proponents have claiming the government is sending messages to banks to stop offering their services to the crypto world.
While the authorities are awaiting SVB and Signature Bank hearings, The Department of Justice (DoJ) and the US Securities and Exchange Commission (SEC) have launched an investigation into Silicon Valley Bank executives who sold shares leading to the bank’s collapse..
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