Other worries heart on whether or not Jerome H. Powell, the Fed chair, allowed an excessive amount of deregulation throughout the Trump administration. Randal Ok. Quarles, who was the Fed’s vice chair for supervision from 2017 to 2021, carried out a 2018 regulatory rollback legislation in an expansive approach that some onlookers at the time warned would weaken the banking system.
Mr. Powell usually defers to the Fed’s supervisory vice chair on regulatory issues, and he didn’t vote towards these adjustments. Lael Brainard, then a Fed governor and now a high White House financial adviser, did vote towards some of the tweaks — and flagged them as doubtlessly harmful in dissenting statements.
“The crisis demonstrated clearly that the distress of even noncomplex large banking organizations generally manifests first in liquidity stress and quickly transmits contagion through the financial system,” she warned.
Senator Elizabeth Warren, Democrat of Massachusetts, has asked for an independent review of what occurred at Silicon Valley Bank and has urged that Mr. Powell not be concerned in that effort. He “bears direct responsibility for — and has a long record of failure involving” financial institution regulation, she wrote in a letter on Sunday.
Maureen Farrell contributed reporting.
