Former FDIC chair on lessons learned from bank collapses

Former FDIC Chair Sheila Bair lists lessons learned from bank collapses
Bair: Banks didn't do a good job of managing interest rate risk
"I don't see a systemic issue." Bair says it's an unusual situation

Updated: Mar 13, 2023 / 06:36 PM CDT

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(NewsNation) — Former FDIC chair Sheila Blair told NewsNation there are lessons that can be learned from the collapse of Silicon Valley Bank and Signature Bank after a bank run.

The banks didn’t do a good job of managing interest rate risk, Blair explained and the failures shouldn’t be seen as a harbinger of systemic issues.

Banks also need to be aware of who their depositors are and how likely those investors are to pull money out if they get nervous. The relatively small number of large investors who withdrew money was part of what led to Silicon Valley Bank’s collapse.

Blair also indicated the fed’s aggressive raising of interest rates may have contributed to the situation.