Banking Crisis 2023

A cultural shift at the Federal Reserve aimed at making the supervisory process more transparent may have also contributed to the central bank's failure to detect and remediate excessive risk at Silicon Valley Bank, whose failure last month roiled the banking industry.

On Friday, Federal Reserve Vice Chair for Supervision Michael Barr will share findings from his review of the supervision of Silicon Valley Bank before its failure last month.

Senior officials of the Federal Deposit Insurance Corp. are said to be weighing whether to downgrade their scoring of the San Francisco bank's condition, including its Camels rating. That could limit the bank's use of the Federal Reserve's discount window and an emergency facility launched last month.

This has been a difficult year for the industry with government takeovers of three regional institutions, which rank among the 10 biggest failures in U.S. history. Here is a look at what went wrong at those three banks and the seven others on this infamous list.

The California bank, which endured large deposit outflows in March, anticipates selling its $2.7 billion lender finance portfolio in the coming months. It's also looking at cutting facilities, employee headcount and vendor costs.

Some 77% of banks did not did not record significant deposit inflows or outflows following Silicon Valley Bank's failure, according to a survey of executives at 567 institutions. The findings highlight the stability of many smaller banks' deposit bases.

The California bank, which was hit hard by last month's banking crisis, has partially rebuilt its deposit base. It reported a first-quarter loss, but one that was smaller than some analysts expected.

Federal Reserve Vice Chair for Supervision Michael Barr had promised to share findings from his review of the Fed's oversight efforts for the failed bank by May 1.

First Republic Bank is exploring divesting $50 billion to $100 billion of long-dated securities and mortgages as part of a broader rescue plan, according to people with knowledge of the matter.

Federal officials should have protected both banks' uninsured depositors by following the law's carefully designed framework for dealing with failures of systemically important banks.