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FDIC Chair Speaks on Resolution of Large Regional Banks
August 17, 2023On Monday, Federal Deposit Insurance Corporation (“FDIC”) Chair Martin Gruenberg gave remarks to the Brookings Institution on “The Resolution of Large Regional Banks.” Chair Gruenberg did not say “I told you so” in his prepared remarks, but Brookings basically did it for him. The Brookings Institution’s description of Chair Gruenberg’s remarks note his 2019 speech to the Brookings Institution when he was a member of the FDIC Board “warning about the underappreciated resolution challenges and financial stability risks that would emerge upon the failure of a large regional bank … [calling for] require[ing] loss absorbing debt at these types of banks and urged stronger resolution planning requirements.” Brooking went on to say that “[h]is words proved prophetic this March when Silicon Valley Bank and Signature Bank failed, resulting in regulators exercising systemic risk authority to protect uninsured deposits.”
