SVB collapse: Senate GOP gets second briefing on bank failure after being 'excluded' from first

Emily Jacobs

March 13, 06:21 PM March 13, 06:21 PM

Senate Republicans received an additional briefing on the Silicon Valley Bank collapse Monday after the Treasury Department neglected to invite or inform a number of GOP lawmakers and staff of a hastily scheduled Sunday session.

Treasury officials briefing lawmakers during the Sunday night session admitted on the call that their invitations did not get out to every lawmaker, an aide to Sen. Tim Scott (R-SC) told the Washington Examiner on Monday. Scott, who serves as the top Republican on the Senate Banking Committee, was one of the many GOP lawmakers who did not receive an invite. GOP Banking Committee staffers were also not told of the Sunday briefing.

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"It is unacceptable that Senate Republicans were excluded from Treasury's briefing to Congress this evening," Senate Banking Republicans tweeted from their minority party account after missing out on the first call. "The lack of transparency & responsiveness from the Biden administration has been galling. The administration has the responsibility to keep ALL members updated in real time."

Sen. John Kennedy (R-LA), who serves with Scott on the panel, was one of the other Republicans not told of the call beforehand, WHD News reported Monday. His representatives did not respond to an inquiry from the Washington Examiner on the matter.

Sen. Katie Britt (R-AL), another Senate Banking Republican, lambasted the Biden administration in a statement to WHD News after the Sunday mishap, telling the network, "The public deserves full transparency and accountability without regards to partisanship, and it is unacceptable that this administration excluded Senate Republicans, including those on the Senate Banking Committee, from Sunday night’s bicameral member briefing."

A number of Republicans were present on the call, however, including Reps. Thomas Massie (R-KY) and Marc Molinaro (R-NY) and Sen. Mitt Romney (R-UT).

The Scott aide said the Treasury Department agreed to another briefing at noon on Monday in an effort to reach those who were missed.

The Treasury Department did not respond to the Washington Examiner's request for comment, though an agency official rejected the accusation that Republicans were purposely excluded to WHD News on Monday, noting that invitations for the call had been sent to GOP leadership in the House and Senate.

Officials on both calls briefed lawmakers on the federal regulatory efforts taking place to prevent the Silicon Valley Bank collapse from tanking other financial institutions. Banking regulators shut down SVB on Friday, two days after the nation's 16th-largest federally insured bank announced that it needed to raise more than $2.2 billion to remain solvent, which sent its stock price plunging over 60% in 48 hours.

On Sunday evening, they also announced the closure of Signature Bank while revealing plans to make customers of both financial institutions whole. The SVB failure is the second-largest in U.S. banking history, while Signature Bank is the third.

Silicon Valley Bank collapse: Mark Warner argues 'best outcome will be an acquisition'

Ryan King

March 12, 01:51 PM March 12, 01:51 PM

Sen. Mark Warner (D-VA) argued that the best remedy for the Silicon Valley Bank collapse would be an acquisition.

Stopping short of ruling out support for a bailout, Warner underscored the importance of SVB depositors receiving their money back and emphasized the speed with which SVB's collapse came about.

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"The best outcome will be – can they find a buyer for this SVB bank today, before the markets open in Asia later in the day. That would be the best," Warner told ABC's This Week host Martha Raddatz.

Last Wednesday, SVB revealed that it sold off a trove of securities at a loss and moved to raise capital, which sparked panic from venture capital firms and catalyzed a run on the bank. By Friday, SVB collapsed and was taken over by federal regulators.

SVB was the 16th largest federally insured bank and the largest to plunge into turmoil since Washington Mutual crashed during the 2008 financial crisis. Warner, who sits on the Senate Committee on Banking, Housing, and Urban Affairs, noted the timeline of its demise.

"This bank bought long-term treasuries, interest rates went up, and they got caught in a bind. But what was different in your report made clear, $42 billion came out of this bank on one day — on Thursday. And frankly, some actors, I think, we're accelerating that run. To put in comparison, Washington Mutual during the crisis ... lost $16 billion dollars over 10 days," Warner stressed.

During the Trump administration, Warner was one of 17 Democrats who backed a mid-sized bank rollback in Dodd-Frank, a comprehensive banking regulation package passed in the aftermath of the 2008 financial crisis. Warner helped author the original Dodd-Frank bill.

"I do think these mid-sized banks needed some regulatory relief," Warned said.

Federal Deposit Insurance Corporation policy dictates that bank deposits are insured up to $250,000, but the vast majority of SVB's deposits were worth over $250,000. Regulators have reportedly been working to ensure that depositors who had over $250,000 stashed in SVB will get their money back.

"Shareholders and the bank are going to lose their money, let's be clear about that. But the depositors can be taken care of," Warner stressed. "There's generally been a feeling that the people responsible, the shareholders of the bank, ought to lose their money. Depositors have been a different circumstance."

Warner also emphasized the risks posed by SVB's collapse to working families.

"I know it's called Silicon Valley Bank, but the startups literally are all across the country, and they've got to pay their bills this week," Warner said. "If other regional banks, midsize banks, if people get nervous, they may start taking their money out of those banks and putting it into the large money center banks. We don't want further consolidation."