GOP Congressman: ‘I Have Not Had a Single Conversation with the White House’ About Changing Cap on FDIC Deposits

(CNSNews.com) – Rep. Patrick McHenry (R-N.C.) said Sunday that he hasn’t had “a single conversation with the White House or the administration” about changing the FDIC insurance levels.

As CNSNews.com reported, Sen. Elizabeth Warren (D-Mass.) proposed raising the cap on FDIC insurance levels.

“Well, that’s the first time I have heard a proposal like that, and I have not had a single conversation with the White House or the administration about deposit insurance, changing the levels. What I will do, though, legislatively, and in an oversight function, is to determine whether or not we need to address the FDIC deposit level. We did it after the last financial crisis raising it from $100,000 to $250,000,” McHenry told CBS’s “Face the Nation.”

When asked whether one of the large systemically important banks should be able to step in and buy up a troubled bank like First Republic, the congressman said, “I think all options should be on the table.”

As to whether there’s anything that would block that kind of “white knight rescue,” McHenry said, “What I need to get to the bottom of investigatively in Congress is the who, what, when, where, why, and how of these bank failures and the decisions made over” Signature and Silicon Valley Banks, “and the decision made over the weekend.”

“We saw a private sector response to help support a bank,” he said. “Was that a viable option last weekend? Or was there an ideological lens that prevented them from taking these institutions and making it less turbulent for America?”

“That’s why I was asking the question I asked you, because what you’re suggesting there is that the Biden administration didn’t want a big bank to come to the rescue here,” host Margaret Brennan said.

“We don’t know that,” McHenry said, adding that “I don’t have the facts on whether or not the FDIC had a viable buyer last weekend. We have press reports of two banks that were at the table. We have comments from other bankers that they were prevented from bidding.

“I don’t have the facts, and until I have the facts, I’m not going to draw a conclusion, especially in a moment like this,” the congressman said.

McHenry said he’s calling in the head of the FDIC and the vice chair for supervision from the Federal Reserve’s Board of Governors because “We need to understand the decisions that were made last weekend on — from Thursday until Sunday night on whether or not there’s a viable private sector solution.

“We also need to understand the underlying causes of the collapse of these banks, and we’re going to get to that. The question of the San Francisco Fed is a question of supervision. We need to get to the bottom of whether or not this is a supervisory problem, a regulatory problem, a bank mismanagement problem, perhaps all three in all frankness,” he said.

BRENNAN: I want to ask you about some of the things being said, populist politics around banking everyone engages in.

MCHENRY: It never ends.

BRENNAN: It never ends, but the two banks that did fail, they were in New York and they were in California. 

Conservatives like Mike Pence, Ron DeSantis, Donald Trump, your colleague James Comer, they’re throwing around terms like woke banks advancing the liberal agenda. They’re blaming diversity and environmental initiatives. Isn’t there a danger in casting a very substantive, active crisis in terms of a culture war?

MCHENRY: I think everyone’s preaching their book. And that’s what we heard in your first segment.

BRENNAN: Right, but do you agree that’s not helpful?

MCHENRY: Everyone is preaching their book, and their book is, well, if they thought it was a problem a month ago, they apply it to this circumstance. That’s happening on both sides of the aisle, but when it comes to the question of ESG and these initiatives, my fellow…

BRENNAN: Environmental initiatives.

MCHENRY: Social and governance. 

BRENNAN: And the encouragement of companies to take that into consideration with their investment. So, there is — there has been a lot of political debate about that. 

There is substance here, and if the management of these institutions was much more concerned about politics or the environmental or social goods, rather than the governance regulations, ensuring you had a capable board, you had proper oversight of people’s deposits, then this shows they had mismanagement. 

So, I think there are — there are natural questions that we have…

BRENNAN: But do you have evidence of that, that the — that the – – I mean, there wasn’t a risk officer fully at Silicon Valley Bank for an extended period of time.

MCHENRY: Yes, and you had very few people that had banking expertise on the board of the bank. So, there are some questions, natural questions we should raise, and we should…

BRENNAN: But, that’s bad — that’s bad management. That’s not woke banking, whatever that means.

MCHENRY: But, as I said, whatever your book of business was as a politician a month ago, a year ago is applied to this general circumstance. What I’m trying to do is get to the details of what happened.

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