The conclusions were unsparing: “Our supervisory staff knew, or should have known, about these vulnerabilities as early as March 2022,” Bowman said, summarizing the report.
SVB’s deposit base was 94% uninsured and concentrated heavily among venture capital-backed technology companies, according to the review, as reported by Bowman.
When the bank announced a $1.8 billion loss on securities sales and sought additional capital, depositors fled, triggering a run that regulators could not contain.
Federal officials, including the Federal Deposit Insurance Corporation (FDIC) and the Federal Reserve, moved to shutter the institution and extend deposit protection beyond the standard $250,000 limit.
A culture of caution that proved costly
The review identified a “long-standing culture of risk aversion” as a central driver of supervisory inaction.
