Why did regulators ignore Dodd-Frank and orderly liquidation for failed banks?

Source: The Hill
by Paul Kupiec

“At 6:15 pm eastern time on Sunday, Treasury Secretary Yellen, Fed chair Jerome Powell and FDIC chair Martin Gruenberg issued a statement confirming that the FDIC insurance fund would cover all depositor balances in accounts held at the failed institutions Silicon Valley Bank (SVB) and Signature Bank, even those above the $250,000 FDIC insurance limit. The statement said that the agency heads were taking the extraordinary action of guaranteeing all deposits in two specific banks using powers available to them under a ‘systemic risk exception’ even though the Dodd-Frank Act specified that the Treasury, FDIC, and Fed should use Orderly Liquidation Authority (OLA) in such a situation. … OLA empowers the FDIC to keep the failing bank open and operating without any depositor losses and ideally without the use of any deposit insurance funds.” (03/16/23)