Sep 24, 2023  |  
 | Remer,MN
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Misty Severi, Breaking News Reporter

NextImg:SVB collapse: Six people to watch in banking disaster

One of the most important conversations on Capitol Hill this past week has been the unexpected collapse of Silicon Valley Bank.

Although the White House has rejected a bailout that echoes the 2008 financial crisis, the Justice Department and the Securities and Exchange Commission have opened an investigation into the bank's failure. Here are six key players to watch as the drama surrounding the collapse continues to unfold:


Michael Barr, Federal Reserve vice chair of supervision:

Federal Reserve Board Vice Chair for Supervision Michael Barr, listens to participants in a conversations with leaders from organizations that include nonprofits, small businesses, manufacturing, supply chain management, the hospitality industry, and the housing and education sectors at the Federal Reserve building, Friday, Sept. 23, 2022, in Washington. (AP Photo/Manuel Balce Ceneta)

Barr is leading the probe into the Federal Reserve's oversight and regulation of the bank. A report on its findings will be released on May 1, according to the reserve.

"We need to have humility, and conduct a careful and thorough review of how we supervised and regulated this firm, and what we should learn from this experience," Barr said in a release on the investigation.

Barr is also expected to play a pivotal role in the future as the Silicon Valley Bank’s developments continue to inform new policy and political considerations on both sides of the country.

Lael Brainard, director of the National Economic Council:

FILE - Lael Brainard, President Joe Biden's nominee to be Vice Chair of the Federal Reserve, speaks during an event in the South Court Auditorium on the White House complex in Washington on Nov. 22, 2021. The Senate Banking Committee approved Brainard's nomination to serve as the Fed's vice chair on Wednesday, March 16, 2022. (AP Photo/Susan Walsh, File)

Brainard, who was recently sworn in as the new leader of the National Economic Council, will serve as the go-between for the White House and Congress when it comes to banking.

Brainard previously served as the vice chairwoman of the Federal Reserve prior to her promotion. During her time as the vice chairwoman, Brainard warned of the SVB crisis if former President Donald Trump had rolled back some regulations that were imposed following the 2008 financial crisis.

Sen. Sherrod Brown (D-OH) chair of the Senate Banking Committee:

Chairman Sherrod Brown, D-Ohio, speaks with Sen. Elizabeth Warren, D-Mass., left, just before Federal Reserve Board Chairman Jerome Powell delivers his semiannual Monetary Policy Report to the Senate Banking, Housing and Urban Affairs Committee, at the Capitol in Washington, Tuesday, March 7, 2023. (AP Photo/J. Scott Applewhite)

Brown's position as the leading senator on the Senate Banking Committee makes him a very important player in the banking crisis moving forward on Capitol Hill, including in talks about future regulations.

In his role leading the committee, Brown asked officials to start a full-fledged investigation into the major financial failure and wrote a letter that outlined the areas that were vulnerable to another collapse. Two banks were shut down by regulators last week, including the New York-based Signature bank.

“These banks were over-concentrated and over-reliant on particular industries and operated with an exorbitantly high percentage of uninsured deposits,” Brown wrote in a letter to the Treasury Department. “Furthermore, the banks also lacked adequate risk management.”

Brown also said that more regulation would be a good step to avoid more disasters in the future.

Rep. Ro Khanna (D-CA):

Rep. Rohit 'Ro' Khanna, from California's 17th Congressional District centered in Santa Clara and other parts of California's Silicon Valley, is interviewed in Los Angeles Friday, Jan. 26, 2018.

Khanna, who represents Silicon Valley in the House of Representatives, has an interesting role on the Hill because he has to balance the interests of the technological community with being on the far left and pushing for more regulations on banks.

Khanna recently said that the Silicon Valley Bank had petitioned him for fewer restrictions, which he claimed had put him at odds with people in his own party.

“They lobbied to weaken the Dodd-Frank restrictions,” Khanna said. "They lobbied me and others to weaken them, to exempt them from the regulations that could have prevented this crisis."

Sen. Elizabeth Warren (D-MA):

Sen. Elizabeth Warren, D-Mass., has previously chided the Democratic National Committee and last November said the Democrat's 2016 primary had been "rigged" in favor of Hillary Clinton. (AP Photo/J. Scott Applewhite)

Warren has been a strong advocate for strict financial regulation and consumer protection on Capitol Hill. As an outspoken advocate during the banking crisis, Warren has strongly condemned bank lobbyists that have pushed for looser regulations.

Warren is considered a key player because of her polarization. Democrats that want tougher regulations see her as a strong ally, but banks have not been so warm.

Jeff Zients, White House chief of staff:

FILE - White House COVID-19 Response Coordinator Jeff Zients speaks during a press briefing at the White House in Washington, April 13, 2021. Former White House COVID-19 response coordinator Zients is among those on the shortlist to succeed White House chief of staff Ron Klain, who is preparing to leave his job in the coming weeks, according to a person familiar with Klain's plans. (AP Photo/Patrick Semansky, File)

Zients entered the White House during a pivotal moment, just before the bank closures. He comes with a solid background in economics, having served as the NEC director under former President Barack Obama, and as a board member for Facebook.


His main job will be to keep Biden on message, while balancing the competing views within his own party. Liberal Democrats are advocating for tougher regulations on the banks, while more centrist Democrats look for a more balanced deal.

“The Biden-Harris Administration moved quickly to stabilize the banking system, without putting taxpayer dollars at risk – a priority for us,” Zients tweeted Friday afternoon. “@POTUS is putting forward specific proposals Congress can pass now to hold senior bank executives accountable. Let’s get it done."

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