Bankruptcy of an American bank SVBtriggered a crisis in the global banking sector, is a “characteristic case of mismanagement,” according to the Fed’s vice chairman in charge of banking supervision. Michael Barr.

In addition, “the failure of the SVB shows the need to move forward in our work to improve the resilience of the banking system,” a federal central bank (Fed) official is expected to address Congress tomorrow, Tuesday, according to excerpts. speeches published today.

Michael Barr was one of the authors of the Dodd-Frank Act, which was enacted after the financial crisis of 2008-2009 to better regulate large US banking institutions. This reform was subsequently rescinded in 2018 by former US President Donald Trump.

“For example, it is important that we propose and implement final Basel III reforms that will better reflect commercial and operational risks in our assessments of banks’ capital requirements,” the Fed vice president is expected to explain.

Basel III, a wide range of international banking reforms, was launched after the financial crisis of 2008-2009 with the aim of strengthening the resilience of banks. Many measures have been taken, but some reforms are yet to be completed, mainly in the United States.

“We have to ask ourselves why the bank was not able to address the problems we identified in time,” Michael Barr is expected to stress, noting that problem solving “is not the job of the regulators,” but “the job of the management and board of the bank.”

AFP-Reuters