Editor’s Note: The NYU School of Law Program on Corporate Compliance and Enforcement (PCCE) is watching the recent banking crisis and failures of Silicon Valley Bank, Signature Bank, and First Republic Bank. In this post, lawyers at Cleary Gottlieb Steen & Hamilton LLP analyze the reports released by the Federal Reserve, the FDIC, and GAO, and the NYDFS.
by Derek Bush, Hugh C. Conroy, Jr., Patrick Fuller, Lauren E. Semrad, Julia A. Knight, Megan Lindgren, Rishi Kumar, and Abby Shamray
From top left to right: Derek Bush, Hugh C. Conroy, Jr., Patrick Fuller, and Lauren E. Semrad.
From bottom left to right: Julia A. Knight, Megan Lindgren, and Rishi Kumar.
(Photos courtesy of Cleary Gottlieb Steen & Hamilton LLP)
In late April, several banking regulators and the Government Accountability Office released reports analyzing factors that contributed to the failures of Silicon Valley Bank and Signature Bank, while at the same time suggesting areas of forthcoming supervisory focus and regulatory change.[1] The “FRB Report,” led by Federal Reserve Board (“FRB”) Vice Chair for Supervision Michael Barr, analyzes the supervision and failure of SVB Financial Group and Silicon Valley Bank (together, “SVB”).[2] The “FDIC Report,” led by the Federal Deposit Insurance Corporation’s (“FDIC”) Chief Risk Officer, and the “NYDFS Report,” led by the New York Department of Financial Services (“NYDFS”) Office of General Counsel, examine the supervision and failure of Signature Bank.[3] The “GAO Report” focuses on how the responsible bank regulatory agencies regulated and supervised SVB and Signature Bank, and how the agencies responded to the March 2023 turmoil.[4]
These reports offer a detailed look into the bank supervisory process and provide important insights into regulatory and supervisory changes that may be on the horizon. In this post, we summarize our expectations for potential regulatory and supervisory developments.