# Fed missed warning signs before Silicon Valley Bank collapsed

> A new review faults Federal Reserve staff for failing to spot the bank's vulnerability before its 2023 failure.
- Title: Fed missed warning signs before Silicon Valley Bank collapsed
- Summary: A new review faults Federal Reserve staff for failing to spot the bank's vulnerability before its 2023 failure. The Fed's supervisors knew or should have…
- Keywords: silicon valley bank, federal reserve, bank failure, supervision, michael barr, michelle bowman, 2023 banking crisis, deposit insurance, regulatory oversight, starling advisory group, business, finance
- Source: CNBC — https://cnbc.com/2026/09/18/fed-silicon-valley-bank.html
- Author: Matt Peterson
- Published: 2026-09-18T13:30:01+00:00
- Read time: 2 min
- Topics: silicon valley bank, federal reserve, bank failure, supervision, michael barr, michelle bowman, 2023 banking crisis, deposit insurance, regulatory oversight, starling advisory group, business, finance
## Fed missed Silicon Valley Bank warning signs
A new outside review found Federal Reserve staff knew or should have known Silicon Valley Bank was vulnerable before its 2023 collapse, according to Fed Vice Chair Michelle Bowman.

> knew, or should have known
## The bank's risky deposit structure
Silicon Valley Bank had 94 percent uninsured deposits concentrated in venture capital-backed technology companies, making it vulnerable when those customers rushed to withdraw funds.

> 94 percent uninsured and concentrated in venture capital, backed technology companies
## What triggered the 2023 bank run
Silicon Valley Bank announced a $1.8 billion loss on securities in March 2023 after the Fed raised interest rates, causing its Treasury holdings to lose value. Customers immediately sought to withdraw their funds.
## Fed's earlier review blamed regulatory changes
Michael Barr's 2023 review found that a 2018 law reducing regulatory standards prompted a less assertive supervisory approach at the Fed.
## New review contradicts earlier findings
The outside consulting firm Starling Advisory Group disagreed with Barr's conclusion, finding that delays in supervisory action were not caused by the regulatory tailoring mandate.

> The delays in supervisory action were not caused by the regulatory tailoring mandate
## Barr steps down, Bowman takes over
Michael Barr stepped down from his supervisory role in February 2025 to allow President Trump to select a new top regulator. Michelle Bowman was confirmed for the position.
## Bowman launches major oversight overhaul
The new Fed Vice Chair for Supervision plans to reduce the Fed's supervision and regulation division by about 30 percent, with a dozen senior staff already having left by early September.
## White House and critics weigh in
The White House charged that Barr failed to do his job and released a politicized report absolving himself of blame. Senator Elizabeth Warren called the new review an embarrassing attempt to rewrite history.

> failed to do his job throughout this debacle
## Key takeaway

The Fed's supervisors knew or should have known Silicon Valley Bank was at risk, but failed to act decisively before the crisis hit.