The failure of Silicon Valley Bank (SVB) and Signature Bank, in the opinion of Rep. Gary Palmer (R-AL), chairman of the House Policy Committee, was partly due to a concentration on the so-called woke agenda rather than the traditional responsibilities of banks.
While acknowledging there might be consequences, Palmer told FM Talk 106.5 in Mobile, AL, he did not think there was a solvency concern.
“First of all,” he declared, “This is not a solvency concern. The problem is one of liquidity. It won’t cause a bank run, in my opinion, but there will be some consequences anyway. I believe that the market is quite wary of this.
The Alabama congressman cited SVB’s political inclinations as evidence that they appeared to come before duties within the financial firm.
Palmer said, “What happened with Silicon Valley Bank was a handful of things that, frankly, were inconceivable to me. “First of all, the bank was without a risk management employee for nine months. Then, only one of their board of directors’ members had any prior banking expertise. Their governing body was founded on inclusiveness, equity, and diversity. They were choosing terrible management strategies. They gave Black Lives Matter more than $70 million. The Silicon Valley Bank was arguably the top financial institution in the nation lending money to green new deal-style businesses that were known for never, if ever, being able to earn a profit. They eventually had a significant liquidity issue, and similar problems are present at the Signature Bank.”
“The management of the assets of the customers who were banking with them was less important than advancing this woke agenda,” he continued.