Wolters Kluwer Compliance Solutions shares insights in response to Silicon Valley Bank and Signature Bank collapse

Rhea-AI Summary

Following the collapse of Silicon Valley Bank and Signature Bank, federal regulators have been working diligently to stabilize the U.S. banking system. Senior Advisor Timothy Burniston from Wolters Kluwer Compliance Solutions notes that investigations are ongoing to identify the causes of these failures. Amid this turmoil, First Republic Bank received a $30 billion deposit boost from major banks. The Federal Reserve and central banks are coordinating efforts to enhance liquidity, with UBS acquiring Credit Suisse to strengthen global markets. Wolters Kluwer reported 2022 revenues of €5.5 billion and continues to provide risk management and compliance solutions to U.S. financial institutions.

Positive

• Prompt federal action to cover deposits beyond the FDIC limit of $250,000.
• First Republic Bank secured a $30 billion deposit from 11 major banks.
• Regulators and banks are proactively working to instill confidence and mitigate losses.

Negative

• Ongoing investigations regarding the root causes of bank collapses raise uncertainty.
• 73% of respondents in a survey expressed high concern about rising interest rates.

WASHINGTON--(BUSINESS WIRE)-- In the wake of the recent collapse of Silicon Valley Bank (SVB) and Signature Bank—and subsequent banking industry developments in the U.S. and elsewhere—markets and the public should be reassured by the response of federal regulators to cover depositors and to help maintain confidence and stability in the resilient U.S. banking system amid challenging economic times. That’s according to a senior regulatory compliance expert at Wolters Kluwer Compliance Solutions.

“Identifying the root causes leading to the collapse of Silicon Valley Bank and Signature Bank is still very much a work in progress. Significant, meaningful efforts are underway in the federal government to comprehensively investigate and review these failures and help avert additional problems,” said Timothy Burniston, Senior Advisor, Regulatory Strategy for Wolters Kluwer Compliance Solutions. “However, what we can point to in the early days of these developments is that regulators and major banks are collectively working to stem further losses and instill confidence.”

Federal regulators moved promptly following the failures of SVB and Signature to ensure that customers were able to access all of their deposits, beyond the $250,000 insured by the Federal Deposit Insurance Corporation. First Republic Bank, meanwhile, received $30 billion in deposits from 11 major banks as part of an effort to support that institution.

“This past weekend, we saw further mitigation efforts by the Federal Reserve and five central banks across the globe with the announcement of a coordinated expansion in the frequency of dollar swap line arrangements to help boost liquidity as part of a growing response to banking industry turmoil. We also saw UBS announce its acquisition of Credit Suisse to help shore up global markets,” he noted. “And we expect more positive measures by regulators and the industry to address and calm the current turbulence in the industry in the days to come.”

Burniston cites economic factors that may have played a role in these collapses, reinforced by Wolters Kluwers’ most recent Regulatory & Risk Management Indicator survey, the results of which indicated that 73% of respondents were highly concerned about interest rate increases.

He emphasized that for each failed institution, resolution and review processes should be allowed to play out and that close attention should be paid to the lessons learned to help others avoid the same fate.

“Although there are many open questions that will be answered in the coming weeks, we should be encouraged by the regulators and industry leaders that stepped forward assertively and decisively to help prevent far greater detrimental effects to the banking industry,” said Burniston.

Wolters Kluwer Compliance Solutions is a market leader and trusted provider of risk management and regulatory compliance solutions and services to U.S. banks, credit unions, insurers and securities firms. The business, which sits within Wolters Kluwer’s Financial & Corporate Compliance (FCC) division, helps these financial institutions efficiently manage risk and regulatory compliance obligations, and gain the insights needed to focus on better serving their customers and growing their business.

About Wolters Kluwer

Wolters Kluwer (EURONEXT: WKL) is a global leader in professional information, software solutions, and services for the healthcare, tax and accounting, financial and corporate compliance, legal and regulatory, and corporate performance and ESG sectors. We help our customers make critical decisions every day by providing expert solutions that combine deep domain knowledge with specialized technology and services.

Wolters Kluwer reported 2022 annual revenues of €5.5 billion. The group serves customers in over 180 countries, maintains operations in over 40 countries, and employs approximately 20,000 people worldwide. The company is headquartered in Alphen aan den Rijn, the Netherlands.

For more information, visit www.wolterskluwer.com, follow us on LinkedIn, Twitter, Facebook, and YouTube.

View source version on businesswire.com: https://www.businesswire.com/news/home/20230321005817/en/

Media Contacts for Wolters Kluwer Financial & Corporate Compliance division:

Paul Lyon

Senior Director, External Communications

Global Branding & Communications

Wolters Kluwer

Office +44 20 3197 6586

Paul.Lyon@wolterskluwer.com

David Feider

Corporate Communications Manager, Banking & Regulatory Compliance

Wolters Kluwer

Tel: +1 612-852-7966

David.Feider@wolterskluwer.com

Source: Wolters Kluwer

FAQ

What actions are regulators taking after the collapse of Silicon Valley Bank and Signature Bank?

Regulators are ensuring customers can access deposits beyond the insured $250,000 and supporting banks like First Republic with significant deposits.

How much did First Republic Bank receive in deposits from major banks?

First Republic Bank received $30 billion in deposits from 11 major banks.

What are the concerns raised by Wolters Kluwer regarding the banking system?

Wolters Kluwer indicated high concern among industry respondents about interest rate increases and the ongoing investigations into the recent bank failures.

What was Wolters Kluwer's revenue in 2022?

Wolters Kluwer reported annual revenues of €5.5 billion for 2022.

What is the role of Wolters Kluwer Compliance Solutions?

Wolters Kluwer Compliance Solutions provides risk management and regulatory compliance solutions to U.S. banks, credit unions, insurers, and securities firms.