Washington, D.C., May 17, 2023 – U.S. Senator Katie Britt (R-Ala.) yesterday demanded answers about the financial mismanagement and risky business practices at Silicon Valley Bank (SVB) during a hearing of the Senate Committee on Banking, Housing, and Urban Affairs with former SVB CEO Greg Becker and two executives from Signature Bank.
Reviews of SVB and Signature Bank have spotlighted both the unique management and supervisory failures that contributed to the respective collapses of the banks. In particular, Becker and SVB’s leadership took home millions in compensation while the bank was engaged in speculative transactions, operated without a Chief Risk Officer for the last eight months of 2022, and had 31 open supervisory findings from the Federal Reserve.
A transcript of the exchange between Senator Britt and Becker follows:
BRITT: So, tell me, what did you do wrong? In reflection, looking back over the last five years, and particularly the last three, what could you have done differently to prevent this from happening?
BECKER: Senator, I’ve thought about your question, especially, over the last eight weeks, pretty much, every day. And it is amazing, I mean, hindsight, we can look at the fastest rate …
BRITT: Absolutely. And that is what I’m asking you to do. In hindsight, what could you have done differently? We can have the best quarterback in the entire country win a Super Bowl. He even goes back and he dissects film to see when he should have stayed in the pocket longer, when he should have moved here. Everyone does this, especially, the teams that lost. You lost, and you lost big. When you dissect that, what could you have done differently?
BECKER: Senator, I think about the — when we were making the decisions, so the investments and when our team made those decisions, I truly do believe that we made the best decision we could …
BRITT: So, you think — yes, I only have a minute 19 seconds left. Let’s get to it. There is nothing you think you could have done differently?
BECKER: Senator, if the …
BRITT: No — yes or no? Is there anything you could have done differently?
BECKER: If the team would have known it was going to be the fastest rate in history, I believe they would have considered different decisions.
BRITT: So, you still take no responsibility for any of this?
BECKER: Senator, I was the CEO of Silicon Valley Bank. I take responsibility for what ultimately happened.
BRITT: If you take responsibility then, will you give that $1.5 million bonus back?
BECKER: Senator, as I previously said …
BRITT: I understand …
BECKER: … I want to cooperate with the process …
BRITT: But, I mean, will you do it? You don’t have to — I mean, will you do it? Let’s say they say, no, you don’t have to give it back, will you give it back?
Because you said you care about your 8,000 employees and their families. You say you care about everything you’ve put everyone through. There are CEOs and banks all across this country that are having to pay up for your mistake.
You said you went to Hawaii. Did you have a chance to walk on the beach, sit on the beach, and when you did, did you think about what you’ve done to these people? And if so, will you give back the $1.5 million from your FY 2022 performance?
BECKER: Senator, as I previously said, I’m committed to cooperate with the process with the regulators and other agencies that I know are going to be looking into that specific question.
BRITT: Okay. Well, I hope even if, for whatever reason, they say you don’t have to, I hope that you dig deep and you decide that that needs to be somewhere besides in your pocket. Thank you.
Video footage of Senator Britt’s line of questioning can be found here.
During the hearing, Senator Britt also emphasized that bad actors in the banking industry are outliers, operating in stark contrast to the practices of Alabama’s financial institutions across the state.
“Despite this, banks in my state of Alabama and in states and communities across the country have proven resilient, and have been able to weather this storm. The same cannot be said of your banks, and I do not believe this is a circumstance of you being unlucky,” Senator Britt told former SVB and Signature executives.
On Thursday, May 18, 2023, the full Banking Committee will be having a hearing with the state and federal regulators that had oversight over both SVB and Signature Bank.