Late in 2018, two Trump-appointed banking regulators, Federal Reserve Vice Chair Randal Quarles and FDIC Chair Jelena McWilliams, went on a nationwide tour to meet with regional bank examiners.

If you're looking for the roots of the banking crisis that took down Silicon Valley Bank and has rattled the entire financial sector for weeks, that's as good a place to start as any.

The officials' message to the examiners was: Back off.

Banks had been bristling for years over what they saw as overly intrusive supervision by the federal agents. That included government examiners, known as supervisors, going over the heads of executives and meeting directly with boards of directors to warn them about risky behavior.

Quarles, the Fed's vice chair for supervision, had served several stints at the Treasury Department under Republican presidents but came to his latest post directly from the private equity business. He was especially candid about making supervision more bank-friendly.

In November 2017, only a month after taking office, he said at a conference of big banks that "changing the tenor of supervision will probably actually be the biggest part of what it is that I do," adding that he "perceived quite an openness in the deep state at the Fed to taking a fresh look."

In the aftermath of SVB's March 10 collapse, fingers have been pointing everywhere. The Fed and other regulators condemn the bank's executives; Fed Vice Chair Michael Barr, in testimony before the Senate Banking Committee on Tuesday, called the bank's failure "a textbook case of mismanagement."

Lawmakers point their fingers at the Fed; as Sen. Tim Scott, R-South Carolina, ranking member of the committee, inveighed, the warning signs of SVB's failure were "clear as a bell." He condemned the Fed, bizarrely, for paying more attention to the implications of climate change than bank supervision.

Others have pointed to the 2018 rollback of regulations imposed by the 2010 Dodd-Frank banking reform act, softening the rules for mid-sized banks such as SVB. Dodd-Frank was written to avert a repeat of the 2008 banking crisis that almost wrecked the U.S. economy. The 2018 amendments set the industry up for a new crisis.

What everyone seems to be missing is the overall deregulatory atmosphere of the Trump administration. At the Fed, the urge to lighten oversight came from the top, in the person of Fed Chairman Jerome Powell, who had been placed on the Fed Board by Barack Obama but elevated to the chairmanship by Donald Trump.

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