WASHINGTON (NewsNation) — As President Joe Biden tries to show that bank executives should not be able to just get away clean if their banks fail, he’s called on Congress to take action to prevent further failures like those of Silicon Valley and Signature Bank.
Biden wants bank executives to expand the Federal Deposit Insurance Corporation’s (FDIC) oversight capabilities in four ways:
- Expand the FDIC’s ability to claw back executive compensation
- Expand FDIC ability to claw back stock sale gains
- Expand FDIC’s authority to fine executives
- Allow FDIC to bar executives from holding banking jobs
In the case of Silicon Valley Bank, the Wall Street Journal reports that CEO Greg Becker sold more than a couple million dollars in common stock in the days leading up to the sale, though he had filed to do so 30 days earlier.
A White House official told NewsNation on Friday that this is not the end from Biden on this front. In the coming days, the president is expected to call for additional actions, as well.
The top Democrat on the Senate Banking Committee on Friday seemed to throw his support behind the concept.
“Working people and small businesses have been forced to pay the price for executives’ arrogance and recklessness too many times before. We need stronger rules to rein in risky behavior and catch incompetence,” said Sen. Sherrod Brown (D-Ohio).
Three Democrats, Sen. Richard Blumenthal of Connecticut and Congressmen Adam Schiff and Mike Levin from California — where SVB is located — have already put forth proposed legislation to go after the compensation of executives at failed banks. It would call for recouping a significant portion of the compensation trifecta: income, bonuses, and stock sales.
NewsNation reached out to the American Banking Associated for comment but has not received a response.