U.S. Sen. Katie Britt (R-Montgomery) put federal financial regulators in the hot seat Tuesday during a Senate Committee on Banking, Housing and Urban Development hearing where she grilled them about their handling of the recent collapses of Silicon Valley Bank and Signature Bank.
Britt opened her line of questioning by first praising Alabama for its strong banking institutions. She then asked the vice chairman for Supervision of the Federal Reserve System’s Board of Governors Michael Barr, if he had used all the tools at his disposal to prevent the banking collapses.
When Barr tried to deflect the question, Britt said: "Well, I find it concerning, though, when you all were asked, each one of you was asked, 'would you like to see more powers, more (regulatory) strength in this?' Every single one of you said 'yes' when you don't actually know if you utilized the tools in your toolbox correctly or if the people that were under your supervision were supervising appropriately.
"I think that's what people hate about Washington. We have a crisis, and you come in here without knowing whether or not you did your job," she continued. "You say you want more. That's not the way this works. You need to be held accountable, each and every one of you. I'm a big believer you gotta own your own space."
Britt emphasized the importance of the agencies and officials working together to prevent a future banking crisis and chided regulators for not getting out in front of the latest collapse.
"[S]ix months prior, JP Morgan noticed that there was a problem, their equity research team, and then Moody's obviously met with SVB prior to saying that they were going to downgrade. So I've heard y'all say this was a rushed process. If the outside sector knew this was happening, you and the Fed and the 4,000 examiners should have known that this was coming as well."
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