The US Federal Reserve's aggressive interest rate rises and a torrent of negative information on social media were key contributors to the collapse of Silicon Valley Bank, former chief executive Greg Becker said on Tuesday.
“Throughout 2021, the Federal Reserve described inflation as a transitory risk, suggesting that interest rates would not increase significantly in the short term,” Mr Becker said in prepared remarks before the Senate Banking Committee.
From 2020-2021, “banks collectively purchased nearly $2.3 trillion of investment securities in this low-yield environment created by the Federal Reserve”, he added.
SVB's collapse led to a run on other mid-size US banks including Signature – which collapsed soon after – and is still being felt across the banking sector.
His remarks before the committee were his first since SVB was placed into receivership in March.
Mr Becker's characterisation of SVB's failure was rejected by Tim Scott, the committee's ranking Republican, who said a lack of judgment showed Mr Becker should not have been running SVB.
“Anyone that pays close attention to the economy over the past two years could have plainly seen that the Federal Reserve was going to continue to increase interest rates,” he said.
Committee chairman Sherrod Brown said the bank's mismanagement was attributed to “the executives getting rich”.
Fed vice chairman Michael Barr, who led the central bank's review of the regulation of SVB, has characterised the regional bank's collapse a “textbook case of mismanagement”.
In a separate hearing before a US House of Representatives committee, Mr Barr said SVB's board of directors had failed to manage risks as they grew, while also acknowledging that federal supervisors did not fully understand the extent of the bank's vulnerabilities.
The separate hearings point to duelling narratives presented by federal regulators and the failed banks' executives, with Mr Becker accusing online media of incorrectly comparing SVB to Silvergate, a bank that was almost entirely focused on cryptocurrencies.
Media comparisons made between SVB and Silvergate, which voluntarily wound down, “caused rumours and misconceptions to spread quickly online, leading to the start of what would become an unprecedented bank run”, Mr Becker said.
“The next day, the bank run picked up steam. By the end of the day on March 9, $42 billion in deposits were withdrawn from SVB in 10 hours, or roughly $1 million every second,” he added.
Mr Becker also says SVB had hired a risk officer in 2022 after consulting with the Fed as the mid-size lender approached $250 billion in assets. He adds that the bank had hired additional risk professionals to support the group.
He says federal regulators had informed SVB that it had sufficient capital and liquidity during this time.
Former Signature executives said the bank could have survived if federal regulators had not stepped in.
“Although I believed that the bank was in a strong position to weather the storm, regulators evidently saw things differently,” former Signature chairman Scott Shay told the committee.
RESULTS
Bantamweight: Jalal Al Daaja (JOR) beat Hamza Bougamza (MAR)
Catchweight 67kg: Mohamed El Mesbahi (MAR) beat Fouad Mesdari (ALG)
Lightweight: Abdullah Mohammed Ali (UAE) beat Abdelhak Amhidra (MAR)
Catchweight 73kg: Mosatafa Ibrahim Radi (PAL) beat Yazid Chouchane (ALG)
Middleweight: Yousri Belgaroui (TUN) beat Badreddine Diani (MAR)
Catchweight 78KG: Rashed Dawood (UAE) beat Adnan Bushashy (ALG)
Middleweight: Sallah-Eddine Dekhissi (MAR) beat Abdel Enam (EGY)
Catchweight 65kg: Yanis Ghemmouri (ALG) beat Rachid Hazoume (MAR)
Lightweight: Mohammed Yahya (UAE) beat Azouz Anwar (EGY)
Catchweight 79kg: Souhil Tahiri (ALG) beat Omar Hussein (PAL)
Middleweight: Tarek Suleiman (SYR) beat Laid Zerhouni (ALG)
Company%20Profile
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The specs
Engine: 1.5-litre 4-cyl turbo
Power: 194hp at 5,600rpm
Torque: 275Nm from 2,000-4,000rpm
Transmission: 6-speed auto
Price: from Dh155,000
On sale: now
Desert Warrior
Starring: Anthony Mackie, Aiysha Hart, Ben Kingsley
Director: Rupert Wyatt
Rating: 3/5
Ten tax points to be aware of in 2026
1. Domestic VAT refund amendments: request your refund within five years
If a business does not apply for the refund on time, they lose their credit.
2. E-invoicing in the UAE
Businesses should continue preparing for the implementation of e-invoicing in the UAE, with 2026 a preparation and transition period ahead of phased mandatory adoption.
3. More tax audits
Tax authorities are increasingly using data already available across multiple filings to identify audit risks.
4. More beneficial VAT and excise tax penalty regime
Tax disputes are expected to become more frequent and more structured, with clearer administrative objection and appeal processes. The UAE has adopted a new penalty regime for VAT and excise disputes, which now mirrors the penalty regime for corporate tax.
5. Greater emphasis on statutory audit
There is a greater need for the accuracy of financial statements. The International Financial Reporting Standards standards need to be strictly adhered to and, as a result, the quality of the audits will need to increase.
6. Further transfer pricing enforcement
Transfer pricing enforcement, which refers to the practice of establishing prices for internal transactions between related entities, is expected to broaden in scope. The UAE will shortly open the possibility to negotiate advance pricing agreements, or essentially rulings for transfer pricing purposes.
7. Limited time periods for audits
Recent amendments also introduce a default five-year limitation period for tax audits and assessments, subject to specific statutory exceptions. While the standard audit and assessment period is five years, this may be extended to up to 15 years in cases involving fraud or tax evasion.
8. Pillar 2 implementation
Many multinational groups will begin to feel the practical effect of the Domestic Minimum Top-Up Tax (DMTT), the UAE's implementation of the OECD’s global minimum tax under Pillar 2. While the rules apply for financial years starting on or after January 1, 2025, it is 2026 that marks the transition to an operational phase.
9. Reduced compliance obligations for imported goods and services
Businesses that apply the reverse-charge mechanism for VAT purposes in the UAE may benefit from reduced compliance obligations.
10. Substance and CbC reporting focus
Tax authorities are expected to continue strengthening the enforcement of economic substance and Country-by-Country (CbC) reporting frameworks. In the UAE, these regimes are increasingly being used as risk-assessment tools, providing tax authorities with a comprehensive view of multinational groups’ global footprints and enabling them to assess whether profits are aligned with real economic activity.
Contributed by Thomas Vanhee and Hend Rashwan, Aurifer
COMPANY%20PROFILE
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KILLING OF QASSEM SULEIMANI
ELIO
Starring: Yonas Kibreab, Zoe Saldana, Brad Garrett
Directors: Madeline Sharafian, Domee Shi, Adrian Molina
Rating: 4/5
Bangladesh tour of Pakistan
January 24 – First T20, Lahore
January 25 – Second T20, Lahore
January 27 – Third T20, Lahore
February 7-11 – First Test, Rawalpindi
April 3 – One-off ODI, Karachi
April 5-9 – Second Test, Karachi
GROUPS
Group Gustavo Kuerten
Novak Djokovic (x1)
Alexander Zverev (x3)
Marin Cilic (x5)
John Isner (x8)
Group Lleyton Hewitt
Roger Federer (x2)
Kevin Anderson (x4)
Dominic Thiem (x6)
Kei Nishikori (x7)
What are the GCSE grade equivalents?
- Grade 9 = above an A*
- Grade 8 = between grades A* and A
- Grade 7 = grade A
- Grade 6 = just above a grade B
- Grade 5 = between grades B and C
- Grade 4 = grade C
- Grade 3 = between grades D and E
- Grade 2 = between grades E and F
- Grade 1 = between grades F and G
John%20Wick%3A%20Chapter%204
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The Gentlemen
Director: Guy Ritchie
Stars: Colin Farrell, Hugh Grant
Three out of five stars
