- The regulator published a report on the reasons for the collapse of the bank
- The department believes that wrong management is to blame
- Allegedly, the management did not listen to the recommendations of the agency
On Friday, April 28, the Federal Deposit Insurance Corporation (FDIC) published a report on the causes of the collapse of Signature Bank. According to him, the organization closed due to the carelessness of the leadership and “infection” in the sector.
The second is the domino effect. In FDIC insistthat the bank failed to cope with the pressure after the situation deteriorated amid the bankruptcy of Silvergate and SVB.
In its report, the regulator also points out that Signature’s top management “did not always listen” to the agency’s recommendations. In particular, this concerns the high risk of servicing cryptocurrency deposits, the share of which was up to 20% of the total assets of the organization.
But at the same time, the FDIC emphasizes that the mere fact of a counterparty’s cooperation with cryptocurrency companies is not the reason for its liquidation. The regulator also noted the “unprecedented speed” of the outflow of client funds, which “may affect” the regulatory framework.
Why is this case suspicious in the community?
Earlier, we reported that the US Blockchain Association was interested in the bankruptcy of Signature. The organization believes that the authorities deliberately closed the bank without obvious signs of a financial crisis as a warning to other counterparties.
This indirectly confirms the fact that the Republicans in the Committee on Financial Services of the House of Representatives are also considering a similar theory. Three representatives of the party asked the FDIC for all the information on this case.
They believe that the federal authorities are conducting an operation to “isolate” the cryptocurrency segment in the banking field. There have been similar precedents in the past.