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Sen. Elizabeth Warren (D-Mass.) said Monday that the collapse of Silicon Valley Bank (SVB) was enabled by Congress, which in 2018 passed a law to ease bank regulations put in place following the 2008 financial crisis. 

In a New York Times opinion piece, Warren noted that SVB was one of many banks that lobbied Congress to pass the bipartisan bill, which scaled back parts of the Dodd-Frank Act. 

“No one should be mistaken about what unfolded over the past few days in the U.S. banking system: These recent bank failures are the direct result of leaders in Washington weakening the financial rules,” Warren wrote. 

Federal regulators shut down SVB on Friday following a massive run on the bank. On Sunday, regulators said they would protect all depositors at SVB and Signature Bank by providing money from a Federal Deposit Insurance Corporation fund paid for by bank fees. 

Warren, who voted against the 2018 bank deregulation bill, said that the crises would have been avoided if the banks were required to hold more liquid assets.

The bill also exempted banks with less than $250 billion in assets from rigorous Fed stress tests, which Democrats and other critics of the bill say could have caught the issues at SVB sooner.

SVB had just more than $200 billion in assets by the end of 2022, making it one of the 20 largest banks in the U.S. but below the higher stress test threshold.

SVB also invested large amounts of money into long-term bonds that saw their value drop when the Federal Reserve raised interest rates. The bank quickly ran out of cash when companies rushed to withdraw their money.

“They would have been required to conduct regular stress tests to expose their vulnerabilities and shore up their businesses,” Warren wrote. “But because those requirements were repealed, when an old-fashioned bank run hit S.V.B‌., the‌ bank couldn’t withstand the pressure — and Signature’s collapse was close behind.”

Warren called on Congress to repeal the 2018 banking law, ensure that regulators can recover bonuses paid out to executives at failed banks and ensure that the Federal Reserve boosts capital requirements.

The Massachusetts senator noted that just days before the collapse, GOP lawmakers pushed Federal Reserve Chairman Jerome Powell not to implement stricter capital requirements for larger banks. Those pleas came at the behest of the banking industry, which had been making the case that banks are well-capitalized.