Bowman faults delayed supervision for Silicon Valley Bank failure
Michelle W. Bowman, Federal Reserve Vice Chair for Supervision, said an independent review found delayed action on Silicon Valley Bank's core risks. Speaking in Bangkok on October 15, 2026, local time, she called for clearer supervisory accountability.
Nine months without effective action
Bowman said preliminary findings from the review she commissioned showed supervisors knew about Silicon Valley Bank's interest rate and liquidity risks at least nine months before its 2023 receivership by the Federal Deposit Insurance Corporation.
Unclear decision rights and accountability delayed enforcement and actionable guidance.
From 2019 to failure, the bank received 54 matters requiring attention or immediate attention; none required action on core financial risks.
The review rejected earlier explanations blaming social media, statutory tailoring or regulatory changes under the 2018 Economic Growth, Regulatory Relief, and Consumer Protection Act.
Bowman said timely intervention gives banks scope to reduce exposures, strengthen liquidity or raise capital.
Decision rights replace procedural delays
The Fed is considering clearer Board and Reserve Bank responsibilities, examiner decision rights and direct escalation to senior leaders.
It refined operating principles published in fall 2025 to prioritize material risks and timely, proportionate action.
Bowman linked this agenda to the Financial Stability Board's (FSB) 2026 work program.
She said the Basel Committee on Banking Supervision (BCBS) and FSB repeated incomplete findings, including then–Vice Chair Barr's April 2023 report, without verification, leaving subsequent regulatory work unjustified.
Findings are not risk control
Bowman's test of supervisory effectiveness is action on material risks, not the number of findings issued.
She said proportionality means tailoring scrutiny to size, complexity and business model, not weaker supervision.
She urged the BCBS and FSB to validate evidence and concentrate on safety, soundness and financial stability.