The move was discreet and quick.
On the same day that Silicon Valley Bank (SIVB) was shut down by regulators, the name of Greg Becker, its CEO, also disappeared from the website of the Federal Reserve Bank of San Francisco.
Becker was a director of the board until March 10.
To be precise, he was a Class A director of the San Francisco Federal Reserve Bank board. He had held this position since 2019. His seat has been vacant since the failure of his bank.
The San Francisco Federal Reserve Bank indicates on its website that there is a "vacant seat Group 1,” the seat which was occupied by Becker. His photo has disappeared but there are photos of the other directors.
"Last updated March 2023," the Federal Reserve Bank of San Francisco says on its website.
Each of the regional Federal Reserve Banks has three classes of directors: Class A, Class B, and Class C. Class A directors are elected and represent the member banks.
Becker along with two other bank executives -- Simone Lagomarsino and Randolph (Randy) Compton -- represented the banks within the San Francisco Federal Reserve.
The 12 regional Federal Reserve Banks are supervised by the Federal Reserve in Washington. The boards of the regional Federal Reserve Banks supervise the local banks to which they give advice in matters of governance in particular. These boards also have a hand in the process of selecting new regional Fed presidents in the event of a vacancy.
Becker Sold Shares Before SVB Collapse
However, these boards are often singled out by Wall Street critics who denounce a sort of collusion between them and the banks they are supposed to supervise.
These criticisms also claim that there are conflicts of interest between board directors and the industry. This stems from the fact that the boss of Lehman Brothers was one of the directors of the New York Fed's board at the start of the 2008 financial crisis. The collapse of his bank on Sept. 15, 2008, is considered the spark of the crisis that nearly swept away the global financial system.
The San Francisco Federal Reserve didn't respond to a request for comment.
Becker has been under fire since the failure of the bank he headed, Silicon Valley Bank, the second-largest bank failure in U.S. history.
He sold $3.6 million worth of SVB shares on Feb. 27, eleven days before SVB was shut down by regulators. This was the result of a run on the bank, caused by the firm’s announcement that it planned to raise $2.25 billion by issuing new common and convertible preferred shares to shore up its finances, after it sold bonds in its portfolio of investments at a $1.8 billion loss.
The question everyone asks is whether he was aware of the capital raise plan.
