SVB failure signals Fed’s need for a speed rethink

Rapid transition to large-bank bracket left supervisors flat footed on rate risk

The US Federal Reserve’s excoriating self-criticism of its handling of Silicon Valley Bank contains a wide array of potential reforms, but former regulators say one particular finding necessitates the most profound rethink of the Fed’s approach to bank supervision.

From 2019 to 2021, SVB’s assets almost tripled – from $71 billion to $211 billion. During that time, the review said, heightened supervisory or regulatory standards did not kick in fast enough.

The review found SVB’s move from the