Democratic Senator Elizabeth Warren from Massachusetts, a member of the Senate Banking Committee, has voiced her support for raising the Federal Deposit Insurance Corp.’s (FDIC) standard cap of $250,000 on deposits. Her comments come after the Silicon Valley Bank‘s failure, which exposed risks at regional banks across the United States.
In a recent interview with CBS News, Warren stated that lifting the FDIC insurance cap would be positive but emphasized the need to determine the right number.
She questioned whether it should be $2 million, $5 million, or $10 million. The decision on this matter is crucial and requires further discussion.
Warren refrained from commenting on whether President Joe Biden‘s administration was actively pushing for raising the FDIC’s deposit insurance ceiling. However, she confirmed that it was one of the options under consideration.
Warren used the opportunity to once again criticize Federal Reserve Chair Jerome Powell for his role in advocating financial deregulation. She held Powell and the Fed ultimately responsible for the SVB’s failure, calling for accountability for regulators who failed to perform their duties.
Warren answered negatively when asked if she had confidence in San Francisco Fed President Mary Daly, citing the regulators’ responsibility for the failure.
Warren demanded accountability from bank executives, including clawbacks from former SVB CEO Gary Becker and a lifetime ban from the financial industry for executives in charge of failed banks.
In conclusion, Warren’s call to lift the FDIC insurance cap is gaining traction, and the matter needs further discussion to determine the right amount.
Accountability is essential for regulators and bank executives who fail to do their jobs properly.