Sen. Elizabeth Warren & Rep. Katie Porter Propose Changes To Bank Regulations Rolled Back By Trump

Sen. Elizabeth Warren (D-Massachusetts) and Rep. Katie Porter (D-California) proposed changes to banking oversight in the wake of the Silicon Valley Bank collapse.

The proposal would reintroduce banking regulations rolled back with bipartisan support during the Trump administration.

“No one should be mistaken about what unfolded over the past few days in the U.S. banking system: These recent bank failures are the direct result of leaders in Washington weakening the financial rules,” Warren wrote in an op-ed for the New York Times. “But it’s no wonder the American people are skeptical of a system that holds millions of struggling student loan borrowers in limbo but steps in overnight to ensure that billion-dollar crypto firms won’t lose a dime in deposits.”

Over the weekend, Silicon Valley Bank, a niche bank catering to tech companies and startups, failed. The bank failure, precipitated by numerous customers attempting to withdraw their money, was the second-largest in U.S. history.

Subscribe to our free weekly newsletter!

A week of political news in your in-box.
We find the news you need to know, so you don't have to.

The bank had invested large portions of its assets in 10-year government bonds, making it unable to accommodate consumers looking to get their cash immediately. The Federal Deposit Insurance Corporation (FDIC) took over the bank Friday after the collapse.

Silicon Valley Bank was worth over $200 billion before the collapse, making it the 16th largest bank in the US.

Warren and Porter’s bill, called the Secure Viable Banking Act, would subject banks with $50 billion in assets to stricter federal oversight. The regulations would subject banks to regular stress tests to determine if financial institutions are prepared for bank runs.

If it had been in effect, the bill could have prevented the fall of Silicon Valley Bank.

The bill would reintroduce stress tests to smaller banks as laid out in the 2010 Dodd-Frank legislation following bank collapses during the great recession. Those regulations were cut back to exclude banks with less than $250 billion in assets. Initial arguments suggested that smaller banks were not structurally significant to the U.S. economy and couldn’t generate economic failure.

Ben Shimkus

Recent Posts

GOP Sen. J.D. Vance Says He’ll Only Accept Results Of 2024 Election If They’re ‘Free & Fair’

Sen. J.D. Vance (R-Ohio), a GOP vice president contender, showed his loyalty to former president Donald Trump by supporting…

2 days ago

As Haley Continues To Accumulate Votes in GOP Primaries, Biden Looks To Win Them Over

The Republican primaries held on Tuesday in Maryland, Nebraska and West Virginia highlight the crucial…

2 days ago

New Louisiana Bill Categorizes Abortion Drugs As ‘Controlled Dangerous Substances’

A new Louisiana bill is awaiting final approval from the state House that would categorize…

3 days ago

Biden Announces Sharp Increases In Chinese Tariffs, Building On Trump’s Program

On Tuesday, President Joe Biden announced his plan to enact an $18 billion tariff increase on Chinese…

3 days ago

Bob Menendez’s Federal Bribery Trial Begins, Senator May Try To Pin Blame On His Wife

Sen. Bob Menendez, a three-term New Jersey Democrat, began his federal bribery trial on Monday in…

4 days ago

GOP Sen. Rick Scott Joins Trump In Attacks Against Judge Merchan’s Daughter

On Thursday, Sen. Rick Scott (R-Florida) accompanied former President Donald Trump to New York City for…

4 days ago