Costa, Colleagues Urge U.S. Financial Regulators and Treasury Department to Act Swiftly After Silicon Valley Bank Collaps

WASHINGTON - Congressman Jim Costa and his House colleagues wrote to Treasury Secretary Janet Yellen, Federal Reserve Chair Jerome Powell, FDIC Chair Martin J. Gruenberg, and Acting Comptroller of the Currency Michael J. Hsu, urging immediate action to protect depositors and prevent runs on banks following the Silicon Valley Bank collapse. 

“Right now, we are concerned about the depositors at SVB, and at banks across the country suddenly unnerved by Silicon Valley Bank’s catastrophic failure that unfolded in only forty-eight hours. If Americans can’t trust that their basic deposits are safe, we could suddenly face runs at banks of all sizes across the country. In the 2008 financial crisis, banks were ‘too big to fail.’ We cannot encourage a system where banks are ‘too small to succeed,’” the Members of Congress wrote in a letter to U.S. regulators and the Treasury Department. “Additional steps need to be taken to give confidence to depositors and discourage them from fleeing to only the largest banks. Unjustified runs on healthy regional banks would be highly damaging to our economy, threaten our national security, and create enhanced long-term risks.”

Read the full letter here.