Bank Board Member and Dodd-Frank Co-Sponsor Barney Frank Suspects ‘Anti-Crypto’ Message Behind Signature Bank Failure – Bitcoin News

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Barney Frank, a former member of the U.S. Home of Representatives from Massachusetts and main co-sponsor of the 2010 Dodd-Frank Act, mentioned his opinion on the current failure of Signature Financial institution. In an interview, Frank said that he believes regulators aimed to “ship a really sturdy anti-crypto message.” Frank, who additionally serves as a Signature board member, defined that he was stunned by the monetary establishment’s demise.

The Third-Largest Financial institution Failure in U.S. Historical past: Signature Financial institution’s Demise was Complicated to Firm Executives

New York regulators from the Division of Monetary Companies (DFS) announced on Sunday night that Signature Financial institution (SBNY) was shut down and the Federal Deposit Insurance coverage Company (FDIC) took over because the financial institution’s receiver. The seizure was meant to “defend depositors,” mentioned DFS superintendent Adrienne Harris. In contrast to Silvergate Bank and Silicon Valley Bank (SVB), Signature’s failure was considerably complicated to some market observers and it was the third-largest financial institution failure in the USA.

On Sunday night, superintendent Harris said that as of December 31, 2022, Signature had about $110.36 billion in property and whole deposits of round $88.59 billion. In accordance with Barney Frank, a Signature board member and former U.S. consultant from Massachusetts, the financial institution’s failure was shocking to its executives. In a phone call interview with CNBC, Frank said, “We had no indication of issues till we skilled a deposit run late Friday, which was solely on account of contagion from SVB.”

Frank defined that concern started to unfold final week as Signature’s prospects started transferring deposits from the New York financial institution to bigger monetary establishments comparable to JPMorgan and Citigroup. Though the previous politician noticed “no actual goal cause” for Signature to be seized and shut down, he suspected that U.S. regulators could have been sending a message.

“I feel a part of what occurred was that regulators wished to ship a really sturdy anti-crypto message,” Frank said. “We turned the poster boy as a result of there was no insolvency primarily based on the basics.”

Frank additionally talked about that withdrawals slowed on Sunday, and Signature executives believed the state of affairs was resolved. Moreover, he asserted that the financial institution’s senior employees tried to discover “all avenues” to resolve the monetary establishment’s liquidity points. Frank was a co-sponsor of the 2010 Dodd-Frank Act, which made important modifications to how U.S. banking and the monetary regulatory system are at the moment performed. Nevertheless, the coverage framework has been partially repealed, and a few U.S. banks are exempt from the Dodd-Frank ruleset.

Tags on this story
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What do you concentrate on Barney Frank’s suspicion that regulators wished to ship an anti-crypto message by shutting down Signature Financial institution? Do you consider it is a truthful evaluation or is there extra to the story? Share your ideas within the feedback part beneath.

Jamie Redman

Jamie Redman is the Information Lead at Bitcoin.com Information and a monetary tech journalist residing in Florida. Redman has been an lively member of the cryptocurrency group since 2011. He has a ardour for Bitcoin, open-source code, and decentralized purposes. Since September 2015, Redman has written greater than 6,000 articles for Bitcoin.com Information concerning the disruptive protocols rising at the moment.




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