(Bloomberg) -- Former Federal Reserve Vice Chair for Supervision Randal Quarles played down the role of looser rules in Silicon Valley Bank’s collapse and said he expects the Fed to raise rates a quarter point next week.

Speaking Tuesday evening in New York, he said financial stability concerns surrounding SVB’s failures undermine support for a 50 basis-point increase at the Fed’s March 21-22 meeting. He said a smaller move, followed by a policy pause, was the most likely outcome.

The changes the Fed made to bank regulations during his tenure “had nothing to do” with the SVB collapse, Quarles said at the event organized by the Money Marketeers of New York University. “I think there’s interesting questions around supervision and interesting questions about the treatment of uninsured deposits,” he said.

Quarles, appointed by President Donald Trump, served as the Fed’s top cop on Wall Street from 2017 until 2021, a period that saw the Trump administration relax some of the tougher rules imposed on the banking industry after the 2008-2009 financial crisis.

The Fed has launched an internal probe of its supervision of SVB after its collapse sparked sharp criticism of the central bank’s oversight.

US regulators took emergency measures Sunday evening to protect depositors of SVB and New York’s Signature Bank, which was also closed, to prevent the crisis spreading.

Quarles said that most stress tests would not have spotted the problems at SVB.

“For banks of SVB’s size, losses in your available for sales securities account have never been run through for capital.” he said. “You don’t have to hold capital against those losses, and that’s always been the case.”

Quarles said he expected the steps to be effective and that the performance of bank stocks earlier Tuesday was a sign the measures would already having the desired effect.

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