The world is talking about this bankruptcy! Fed launches investigation into SVB

The Fed statement indicated that the result of the review, which will be conducted by Michael Barr, Vice President of Financial Institutions, will be published on May 1.

“REVIEW NECESSARY”

“Events surrounding Silicon Valley Bank require thorough, transparent and expeditious scrutiny by the Fed,” Fed Chairman Jerome Powell said in a statement. he performed the assessment of it.

“WE WILL REVIEW”

“We need to be humble and carefully and thoroughly review how we oversee and regulate this company and what we can learn from this experience,” Barr added. he used the phrase.

It should be noted that the Fed’s review decision came after criticism of the Central Bank’s supervision after the bankruptcy of the SVB.

In news from the US press, it was indicated that the Joe Biden administration examined the quality of supervision of the bank carried out by officials of the state of California and the San Francisco Fed.

LARGEST BANKRUPTCY SINCE 2008

The share price had lost more than 60 percent last week after California-based SVB closed its $21 billion bond position at a loss of about $1.8 billion and announced it would raise more than $2 billion. million in equity.

Its operations were suspended because the bank kept losing after some venture capital investors advised companies to withdraw their money from the bank.

The US Federal Deposit Insurance Corporation (FDIC) announced on March 10 that a trustee has been appointed to the SVB, sending markets tumbling. In the statement made by the FDIC, it was noted that the SVB was the first FDIC-insured institution to file for bankruptcy this year.

The SVB bankruptcy was one of the largest bankruptcies recorded in the US since the 2008 global financial crisis. The largest such bankruptcy occurred during the 2008 crisis, when Washington Mutual went bankrupt.

SVB, the 16th largest bank in the US, often provided financing to startups and venture capital. (AA)