Banking Crisis: One Year Later

Fifteen banks have failed since 2019, with the most recent one collapsing on October 18, 2024.

Morgan Stanley will have to pay $2 million for failing to flag trading in First Republic Bank by its former CEO. The transactions happened in the lead-up to the regional bank's collapse.

A sharp decline in bonuses led to a decrease in median bank CEO pay last year.

Former executives from two banks that collapsed within two weeks of each other spoke Tuesday about lessons to be learned from the crisis.

Total direct compensation for the CEOs of large and midsize banks declined by 6.6% in 2023, and annual bonus payouts tumbled by 30%. The decreases came as banks grappled with the fallout from last spring's banking crisis.

New York Community Bank's acquisition of the failed Signature Bank helped with its liquidity. But there were other considerations that decisionmakers overlooked in allowing the transaction to take place.

There were significant red flags that regulators overlooked when allowing New York Community Bank to acquire Signature Bank. Those include the fact that the company was still integrating the Flagstar Bank transaction.

On both sides of the Atlantic, regulators have failed to live up to their promises about how they would approach bank failures. Until they do, the industry operates in legal limbo.

The Federal Home Loan Bank System stepped up advances by 37% or more to Silicon Valley, Signature and First Republic banks ahead of their failures, the GAO says in a post-mortem on last year's banking crisis. The findings add to the debate about whether the system should be a lender of last resort.

Larger banks are responsible for a special assessment to cover the costs of the failures of Silicon Valley Bank and Signature Bank. The price tag has ballooned by $4.1 billion, and trade groups are criticizing the FDIC's process, arguing that it lacks transparency.