Last week, US Senate Banking Committee Republicans called for the withdrawal of the Federal Deposit Insurance Corporation's (FDIC) new corporate governance guidelines. They argued that the proposed rules, aimed at institutions with over $10 billion in assets, would undermine the safety and soundness of the financial system.
In a letter to FDIC Chair Martin Gruenberg, Ranking Member Tim Scott and eleven other Republican Senators emphasized the need for clear regulatory frameworks to maintain safety and soundness. They pointed to the 2023 banking turmoil as an example of what happens when risk management and supervision are deficient. "The failure of Silicon Valley Bank (SVB) in particular underscores the necessity for regulatory constructs to emphasize clear and direct accountability standards for both bank management and regulators," the Senators wrote. "Unfortunately, the Proposal, as drafted, indicates the FDIC is preparing to move in the opposite direction."
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