GAO Urges Disclosure Overhaul After 2023 Bank Failures

The failures of Silicon Valley Bank, Signature Bank and First Republic Bank in spring 2023 exposed how rapidly interest-rate and liquidity risks could overwhelm regional lenders. The U.S. Government Accountability Office said public banks without a bank holding company fall outside Securities and Exchange Commission disclosure review and are instead reviewed by banking regulators, whose processes are not designed primarily for investor protection. Signature and First Republic used that structure, leaving investors with less scrutiny of potentially material warning signs.

In a report released Sept. 3, 2026, the GAO said 11 publicly traded banks were outside SEC review, including two with more than $80 billion in assets. Shareholders in Signature and First Republic lost more than $29 billion between the end of 2022 and May 2023. The GAO urged Congress to reassess who reviews disclosures by banks without holding companies and recommended SEC guidance on when breaches of interest-rate or liquidity-risk tolerances are material. The SEC opposed the recommendation, saying staff already provide post-disclosure feedback when warranted.