Bowman faults delayed supervision for Silicon Valley Bank failure
Michelle W Bowman, Federal Reserve Vice Chair for Supervision, said an independent review found supervisors failed to act on Silicon Valley Bank's known risks. She spoke in Bangkok on October 14, 2026.
Nine months without effective action
Bowman said preliminary findings showed supervisors knew about Silicon Valley Bank's interest rate and liquidity risks at least nine months before Federal Deposit Insurance Corporation receivership in 2023.
Unclear decision rights and weak accountability delayed enforcement and actionable guidance.
Between 2019 and its failure, the bank received 54 matters requiring attention or immediate attention; none required action on its core financial risks.
The review rejected earlier explanations blaming social media, statutory tailoring under the 2018 Economic Growth, Regulatory Relief, and Consumer Protection Act or regulatory changes.
Bowman said earlier reports, including then-Vice Chair Barr's April 2023 report, were incomplete.
Clear authority replaces committee delays
The Federal Reserve is considering clearer responsibility between Board and Reserve Bank staff, explicit decision rights and direct escalation from examiners to senior supervisory leaders.
It has refined operating principles published in fall 2025 using lessons from the independent review.
Bowman advocated early identification of material risks and timely, proportionate action.
Supervisory intensity would reflect banks' size, complexity, activities, business models, interconnectedness and stability impact.
She said proportionality does not mean weaker supervision.
Standards need verified foundations
Bowman said the Basel Committee on Banking Supervision and Financial Stability Board repeated unverified findings from earlier reports.
She argued that the resulting regulatory work lacked justification.
Her stated test for modernization is timely action on material risks, not the volume of supervisory findings.