FDIC pins Signature Bank’s failure on poor governance and illiquidity

SBNY management did not prioritize good corporate governance practices, did not constantly heed FDIC examiner issues, and was not constantly responsive or timely in resolving FDIC supervisory recommendations (SRs).” The FDIC blamed Signatures board of directors and management for pursuing “unrestrained growth” using uninsured deposits without executing liquidity threat management methods. Source: FDICDue to noncompliance with the recommendations, the FDIC reduced SBNYs liquidity component rating to “3” starting in 2019, further highlighting the requirement to enhance its fund management practices.Related: Ludicrous to believe Signature Banks collapse was linked to crypto, says NYDFS headTwo federal government bodies were supposedly examining Signature Bank for money laundering prior to its collapse.

SBNY management did not focus on great corporate governance practices, did not always follow FDIC inspector concerns, and was not constantly responsive or prompt in attending to FDIC supervisory recommendations (SRs).” The FDIC blamed Signatures board of directors and management for pursuing “unrestrained growth” utilizing uninsured deposits without executing liquidity danger management techniques. Source: FDICDue to noncompliance with the recommendations, the FDIC downgraded SBNYs liquidity part rating to “3” beginning in 2019, further highlighting the requirement to enhance its fund management practices.Related: Ludicrous to think Signature Banks collapse was connected to crypto, states NYDFS headTwo government bodies were apparently examining Signature Bank for money laundering prior to its collapse.

The United States Federal Deposit Insurance Corporations (FDIC) post-mortem assessment of Signature Bank (SBNY) exposed poor management and inadequate danger management practices as the origin for its collapse.Federal regulators shut down Signature Bank on March 12 to secure the U.S. economy and enhance public confidence in the banking system. The FDIC was selected to handle the insurance procedure. @federalreserve @USTreasury @FDICgov problem declaration on actions to protect the U.S. economy by strengthening public self-confidence in our banking system, guaranteeing depositors cost savings stay safe: https://t.co/YISeTdFPrO— Federal Reserve (@federalreserve) March 12, 2023