As banks topple, regulators face reckoning


In this photo illustration, Silvergate Capital Corporation

NEW YORK: Last Monday, the head of the Federal Deposit Insurance Corp (FDIC) warned a gathering of bankers in Washington about a US$620bil (RM2.8 trillion) risk lurking in the US financial system.

Last Friday, two banks had succumbed to it. Whether US regulators saw the dangers brewing early enough and took enough action before this week’s collapse of Silvergate Capital Corp and much larger SVB Financial Group is now teed up for a national debate.

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