![]() ![]() The 2018 law that eased banking regulations advanced with a degree of encouragement from Frank, who was on Signature’s board at the time. Kathy Hochul said Monday that federal and state regulators “saw that a run on a regional bank could pose a great risk to our stability.” They apparently had a more negative view of our solvency.”Ī Signature spokesperson declined to comment on what happened with the bank. “The FDIC and the state of New York looked at things and made their decision,” Frank said. ![]() A number of moderate Democrats still in Congress helped write the 2018 legislation, including those facing reelection in 2024.įrank, who served on Signature’s board since 2015, said his bank was in “good shape” but was hit with a run generated by “the nervousness and beyond nervousness from SVB and crypto.” The bank’s digital assets business made it the “unfortunate victim of the panic that really goes back to FTX,” the cryptocurrency exchange that failed last year.įrank said other lenders were in trouble the last few days, with the Federal Home Loan Bank telling Signature when it applied for money on Friday that “they didn’t have enough to go around because they were getting so many requests.”įrank said Signature, now in the hands of regulators, will probably sell for close to what the bank’s leaders believed it’s worth. Some Democrats, like Frank, say the 2018 law isn’t the problem. Some like Warren want Washington to restore the tougher regulations that were rolled back in 2018. The rift between Frank and Warren is just a preview of what’s to come as Democrats sort out positions on how to respond to the latest banking crisis, which led to a weekend bailout of depositors at Silicon Valley Bank and Signature. “They should have to meet higher capital standards, they should be subject to stress tests and they should have regular supervision that would catch exactly the kind of mistake that SVB made, mistakes about the failure to hedge risk and mistakes about concentrating in one industry,” Warren said in an interview Monday. ![]()
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