by Harold Hutchison
A former economic adviser to former President Donald Trump said Monday that the Federal Deposit Insurance Corporation (FDIC) prevented several efforts to purchase Silicon Valley Bank.
Federal regulators shut down Silicon Valley Bank Friday after its stock price collapsed and customers began a bank run following the financial institution’s disclosure of a $1.8 billion loss on asset sales due to high interest rates, CNBC reported. The Federal Deposit Insurance Corporation (FDIC) also shut down Signature Bank Sunday, citing “systemic risk,” CNBC reported separately.
“I have heard it from people I have a great deal of faith in that were very close to the situation that there were buyers who were willing to step in and buy the bank and that the radicals at the FDIC basically weren’t going to allow that to happen,” Kevin Hassett, a former chairman of the Council of Economic Advisers, told Fox Business host Larry Kudlow. “I even heard again someone told me this directly that was close to the situation, that the Biden administration had a whitelist of companies were allowed to buy the failed bank and companies that weren’t.”
Depositors who had accounts at Silicon Valley Bank and Signature Bank will be able to fully recover their funds, the FDIC announced in conjunction with the Treasury Department and the Federal Reserve Sunday.
Republican Sen. Bill Hagerty of Tennessee questioned why the FDIC opposed purchases of Silicon Valley Bank in a Sunday Twitter post.
“Based on news reports, the FDIC seems to have rejected market buyers of SVB & instead turned the Fed & Treasury into an even bigger safety net,” Hagerty tweeted.
Hassett also criticized the FDIC for not allowing the purchases, adding that Congress should hold hearings on how the FDIC handled the reported offers.
“They’re so concerned about some bank getting a little bit bigger that they have decided to put all these taxpayer monies at risk and I think it’s something we’ve seen from the Biden administration really from the beginning is that they have got a radical left agenda,” Hassett said. “And it does not ever exude any common sense. So here we are in the middle of a potential banking crisis, we’ve got people willing to step up to buy the company and the radical left-wingers at the FDIC won’t let them do it.”
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Harold Hutchison is a reporter at Daily Caller News Foundation.
Photo “SVB Headquarters” by Coolcaesar CC4.0.