The embattled Democrat has served on the agency’s board for nearly two decades His second stint as FDIC chair was marred by allegations that the agency fostered a toxic culture Chair Martin Gruenberg will retire from the agency “It has been the greatest honor of my career to serve at the FDIC. I have especially valued the privilege of working with the dedicated public servants who carry out the critically important mission of this agency,” he wrote in an email later posted on X The retirement date comes one day before President-elect Donald Trump is set to take office Gruenberg has been a constant at the FDIC since 2005 — the longest-tenured board member in the agency’s history He’s served as FDIC chair twice — from 2012 to 2018 and again from early 2023 until now The FDIC agreed to let law firm Cleary Gottlieb audit the agency’s culture. Less than two weeks after the audit was published, Gruenberg agreed to resign — conditionally He said in May he’d step down once the Senate confirmed his replacement The Biden administration nominated Christy Goldsmith Romero, a commissioner with the Commodity Futures Trading Commission, to serve as FDIC chair. And although her hearing came and went without major objections Gruenberg’s pending departure clears the way for Trump to nominate his own candidate to lead the FDIC. Presumably, Hill is on a shortlist for that role Gruenberg said Tuesday he had informed President Joe Biden and the FDIC of his decision “Over the coming weeks I hope to have the opportunity to speak with many of you and thank you personally for your service,” he told employees Tuesday “But for now allow me to extend my gratitude to all of you.” Get the free daily newsletter read by industry experts The longtime central bank governor often served as a vocal counterpoint during Michael Barr's tenure While Bank of America CEO Brian Moynihan called the recent regulatory shift “classic re-engineering,” one peer exec said the changes “are taking all the oxygen in the room.” Subscribe to the Banking Dive free daily newsletter The free newsletter covering the top industry headlines FDIC Chairman Martin Gruenberg has participated in the response to three financial crises: the thrift and banking crisis of the late 1980s and early 1990s and the three large regional bank failures in the spring of 2023 he discussed the causes of those crises and the lessons they offer for today and the future Gruenberg joined a fireside chat with Brookings Senior Fellow Aaron Klein 1930 the daughter of Walter and Rose (Baertschi) Thoman June attended Purcell Country Grade School in Rural Monticello 1948 June married Paul Gruenberg in Monticello June farmed with her husband for many years After retiring from the farm June cleaned at the Gasthaus Motel John’s United Church of Christ where she sang in the choir June was also a former member of Women of the Moose She enjoyed sewing and traveling with her husband on fishing trips to Canada and traveling from Mexico to Alaska Glorianne Rufenacht and Linda Klemm both of Monroe; brothers and Alan (Shirley) Thoman of Wisconsin Rapids; daughter-in-law She was preceded in death by her parents; husband Marvin Thoman and Donald (Marie) Thoman; and brother-in-law John’s United Church of Christ with Reverend Todd Hackman officiating Visitation will be held from 10:00 AM until the time of service at the church Shriner Hager Gohlke Funeral Home is assisting the family Condolences may be sent to the family at: shgfuneralhome.net Please enable JS and disable any ad blocker chairman of the Federal Deposit Insurance Corp.Allison Robbert/Bloomberg Federal Deposit Insurance Corp Chairman Martin Gruenberg — the agency's longest serving board member — said Tuesday that he would retire from the agency in January Gruenberg said he had given President Biden notice that he plans to retire as chairman and member of the board of directors of the FDIC effective Jan the day before President-elect Donald Trump is sworn in  "It has been the greatest honor of my career to serve at the FDIC I have especially valued the privilege of working with the dedicated public servants who carry out the critically important mission of this agency," he wrote "Over the coming weeks I hope to have the opportunity to speak with many of you and thank you personally for your service But for now allow me to extend my gratitude to all of you." Gruenberg was the child of Holocaust survivors from Poland He received his undergraduate degree at Princeton University's School of Public and International Affairs and a J.D Gruenberg began his career in the late 1970s working as the Bronx Congressional aide for Jonathan Bingham where he supported housing and development projects in the Bronx Gruenberg served as a board member of the FDIC since 2005 having been nominated by President Bush and confirmed to the position of vice chairman by the Senate.  Gruenberg built a reputation as a steady and principled leader in financial regulation who sought to protect the stability of the banking system while addressing the intersection of financial regulation and community impact.  Gruenberg joined the FDIC board after serving in the financial services and regulatory areas in Congress Gruenberg served as staff director of the Banking Committee's Subcommittee on International Finance and Monetary Policy from 1987 to 1992 He was also senior counsel to Maryland Democratic Sen Sarbanes on the staff of the Senate Banking Committee from 1993 to 2005.  Gruenberg led the FDIC's response to the 2023 failures of Silicon Valley Bank and Signature Bank, the largest banking calamity since the 2008 financial crisis. Under his leadership, the agency proposed a number of new bank regulations — including higher capital requirements long-term debt reforms and regulations around uninsured deposits at banks — aimed at preventing further industry turmoil.  Student loans CFPB wins rare judgement over student loan debt relief firm A federal judge has ordered FDATR a now defunct student loan debt relief provider to pay $43 million in restitution and fees bucking the trend of cases brought by the Biden administration-era Consumer Financial Protection Bureau being dropped Industry News How Cathinka Wahlstrom is modernizing America's oldest bank BNY's chief commercial officer talks about AI tariffs and her efforts to help create a leaner which he thinks reinforces the case for deregulation including Early Warning's peer-to-peer money transfer app Zelle reiterates the importance of bank redundancies FORECLOSURE WARS She stopped paying her mortgage more than 15 years ago consumer and business confidence are on the upswing while inflation and interest rates have largely stabilized it’s a highly favorable backdrop for banks as witnessed by a rising balance in the FDIC insurance fund and a mere two bank failures in 2024 The industry posted combined net income of $65.4 billion in the quarter ending Sept the most recent for which information is available who resigns as chairman of the bank-regulatory Federal Deposit Insurance Corp at the end of President Biden's term in January opening the transition for a new agency chief to be appointed by Donald Trump Gruenberg has drawn criticism amid complaints the FDIC emerged as a hostile workplace marked by sexual harassment and other misconduct In a Jan. 14 talk at the Brookings Institution Gruenberg reviewed the three most recent banking traumas of the last half century in arguing that many of the same factors that caused so much havoc before could recur The first crisis was marked by a slew of failures among banks and thrifts in the early 1980s The second was the mortgage crisis that brought down more banks and plunged the economy into a deep recession around 2008-2010 failure of three large regional banks including Silicon Valley Bank "I am struck by how many common threads run through them even as the specific context and details differ," he said The troublesome factors cited by Gruenberg included interest-rate risks for banks a reliance on high amounts of uninsured deposits and new financial products that weren’t well understood Many of the same factors remain prevalent today including financial institutions that aren’t banks and thus fall outside of their regulatory oversight with much less transparency and supervision given that today’s largest banks are bigger more complex and more deeply intertwined than ever before 2025 banking sector outlook: FDIC 'problem bank' list grows as industry profits dip For bank customers and especially depositors a key takeaway of his discussion reflects the growing role of nonbanks These entities held $20.5 trillion in assets in the U.S according to a tally by the Financial Stability Board cited by Gruenberg in a 2023 speech These nonbanks include stock and bond mutual funds many of which have intricate ties to traditional banks few investors would assume a stock fund comes with the same protections as a bank deposit account but the differences aren’t always so clear such as with money-market mutual funds and money-market deposit accounts at bank Hence the importance of understanding what you own The two bank failures in 2024 were at Republic First Bank in Pennsylvania and First National Bank of Lindsay Should deposit-insurance coverage be raised?In his talk, Gruenberg questioned whether the FDIC's insurance protections are adequate. The fund insures bank deposits, basically to the tune of $250,000 per depositor at each institution (with a similar federal fund backing credit unions) The amount was last raised in 2008 from $100,000 and the threshold might need to be increased again While most consumers wouldn’t bump up against that limit especially as they can get more coverage by spreading their deposits among multiple banks it's a different story with business customers larger companies easily could exceed $250,000 in a deposit account dedicated to meeting payroll disbursements Silicon Valley Bank's failure was tied to having a high proportion of uninsured depositors who fled quickly when cracks began to appear About 90% of the bank's deposits were uninsured at that time The FDIC estimates them at more than $7 trillion which would represent more than 40% of all banking deposits of providing blanket insurance coverage to all deposits as less feasible as it would result in much higher expenses for banks which pay premium assessments to support the FDIC’s insurance fund When asked by Brookings senior fellow Aaron Klein about what keeps him up at night such as a surprise spike in interest rates that could wreak havoc on the economy and banking sector The second is the growth of nonbanks and the prevalence of noninsured deposits (above the $250,000 limit) at mainstream banks “We should not allow the relative stability (of the banking sector) to lull us into a false sense of complacency,” Gruenberg said Reach the writer at russ.wiles@arizonarepublic.com speaking Tuesday at the Brookings Institution shared lessons learned from bank crises “as we head into a period of uncertainty about the future path of financial regulation.” in his final days leading the banking agency identified the growth of the non-bank financial sector as one of his biggest concerns Gruenberg, set to step down from his role Jan. 19, offered parting thoughts Tuesday recapping the similarities between the bank and thrift crisis of the 1980s the Global Financial Crisis of 2008 and the regional bank failures of 2023 and the need to keep the lessons they offered top of mind “I am concerned that memories are short,” Gruenberg said cautioning against allowing current stability “to lull us into a false sense of complacency.” Gruenberg has served on the FDIC’s board since 2005 making him the third-longest tenured financial regulator in American history Gruenberg was vice chairman of the FDIC during the 2008 crisis and served as a Senate Banking Committee staff member during the 1980s crisis The outgoing FDIC chair said he sought to share lessons from those experiences “as we head into a period of uncertainty about the future path of financial regulation” in the U.S The incoming Trump administration is largely expected to usher in a period of lighter regulation strong and effective supervision is indispensable,” Gruenberg asserted private credit lenders and non-bank mortgage servicing companies Gruenberg frets over “the prospect of some external shock” to the U.S economy and financial system that could prompt a sharp spike in interest rates Since some non-bank firms are highly leveraged and “deeply connected” to the banking system Gruenberg worries about a domino effect similar to what was seen in 2008 “One thing we learned in 2008 is to take tail risks seriously Gruenberg also warned of the risks that come with innovation financial products and companies come with the evolution of the financial system “but we should not kid ourselves into believing that they don’t present risks that need to be carefully supervised and Reflecting on the three bank crises that occurred during his time in financial regulation Gruenberg said he’s struck by what they have in common: “interest rate and liquidity risk new activities and products whose risks were poorly understood interconnection with non-bank financial companies and failures of supervision and regulation to identify and address those risks “supervision should have been emphasized more not less,” especially given the bank’s rapid growth and balance sheet concentrations the management of interest rate risk – central to the 2023 bank failures –  remains an issue for banks “We still have the underlying vulnerabilities that precipitated the 2023 failures,” including large concentrations of unrealized loss on assets on balance sheets and larger banks’ reliance on uninsured deposits “What’ll be important is to continue our efforts to strengthen the supervision of those underlying risks in the cases of those three failed banks,” Gruenberg said referring to SVB as well as Signature and First Republic banks He also noted unfinished work on rulemakings including finalizing bank regulators’ capital requirements proposal Basel III was a fundamental response to elements of the 2008 crisis And one of the elements within that proposal – requiring banks to hold capital against their unrealized losses on available-for-sale securities – “would have been very helpful in 2023,” he said The speech served as a counterpoint to FDIC Vice Chair Travis Hill’s remarks last week who’s largely expected to replace Gruenberg as chair called for “a new direction” for the agency Hill advocated for a shift in bank supervision zeroing in on core financial risks rather than on “process-related issues that have little bearing on a bank’s … financial condition or solvency.”  Hill also said he anticipates the regulator will soon take “a more open-minded approach” to innovation and technology bank said he sees President Donald Trump’s tariff policy as "one large additional straw on the camel’s back." After scrapping a policy requiring board diversity for companies it advises Goldman backed off its own equity initiatives But its CEO is keeping a strong stance on diversity’s value House Financial Services Committee Republicans bemoaned recent “disastrous” banking rules and pushed regulators to pause work on new rules before Trump takes office Republicans on the House Financial Services Committee on Wednesday sought to persuade bank regulators to commit to pausing any rulemaking plans until President-elect Donald Trump takes office in two months During the committee’s oversight hearing of the Federal Reserve the Office of the Comptroller of the Currency and the National Credit Union Administration Republicans bemoaned the “disastrous” and “partisan” regulation that’s come from those agencies during the Biden administration Given the outcome of the presidential election “the era of post-financial crisis regulation is over,” committee Chair Patrick McHenry “This administration’s regulators failed to see it Additionally, FDIC Chair Martin Gruenberg faced more Republican ire for continuing to lead the agency. Gruenberg last appeared before the committee in May, just days after the release of law firm Cleary Gottlieb’s scathing report on the FDIC’s work culture Gruenberg told FDIC staff Tuesday that he would retire But Republicans on Wednesday denounced that move and expressed disapproval that he hasn’t yet left Just ahead of the hearing, the committee’s Republicans issued a report detailing the FDIC’s workplace culture under Gruenberg and introduced a resolution calling for Gruenberg’s immediate removal Given the upcoming change in presidential administration Republicans called on regulators to avoid moving forward with new rules and regulations in the next two months “We don’t want to spend the last few weeks of the Biden administration fighting over bad policy ideas,” said Rep. French Hill, R-AR. Hill is one of the top contenders to replace McHenry, who didn’t seek reelection this year prodded regulators on whether they’re reviewing finalized regulations and considering rolling back rules who scolded regulators for their “anti-crypto crusade,” aimed to get each official to commit that their agencies would halt “overregulation” during “the dying light of your time here.” Acting Comptroller Michael Hsu said the OCC would follow the Administrative Procedure Act and do its job but appeared to indicate the agency wouldn’t put forth new proposals before being cut off by Nunn Gruenberg noted the FDIC has a number of rulemakings in process and has extended comment periods for some but doesn’t expect any will be ready for action before the end of Biden’s term Michael Barr, the Fed’s vice chair for supervision, said the central bank expects to work with new colleagues at the OCC and FDIC in the coming year on its three rulemakings in the works, including the closely watched capital requirements proposal In September, Barr laid out adjustments to that proposal, which regulators acknowledged Wednesday isn’t likely to move forward during Biden’s term The agencies have other joint efforts in the works such as one related to combating elder fraud but on “the major rulemakings that people are focused on,” Barr said he plans to wait to work with new colleagues at the OCC and FDIC and other regulators present nodded in agreement The changes to the Basel proposal “take on the major issues in the comment letters that have the most material impact,” Barr told lawmakers Wednesday There are additional changes that I would expect would be appropriate prior to finalizing the Basel III endgame rule.”   sought to find out if Barr was willing to “go it alone” on the Basel proposal if the next heads of the OCC and FDIC are “incredibly unreasonable.” What do you do if you end up with unreasonable colleagues?” Sherman asked Barr referring to Trump’s picks for attorney general and secretary of state “I’m not going to engage in a hypothetical,” Barr replied Steve Gruenberg was named the Assistant Baseball Coach at Case Western Reserve University in October 2020 receiving a berth to the NCAA Tournament in 2023 and 2024 and claiming the University Athletic Association Championship in 2022 and 2024 His work with the pitching staff helped lead sophomore Tyler Horvath to D3baseball.com All-America Second Team honors in 2022 while Horvath shared UAA Pitcher of the Year honors with graduate student Evan Faxon Gruenberg helped the 2024 staff finish the year ranked third among all Division III teams with 10.5 strikeouts per nine innings while the team's 413 total strikeouts during the year surpassed the previous program record by 54 Gruenberg brought with him extensive experience as an NCAA Division III coach He came off an eight-year stint as the Associate Head Baseball Coach at Kenyon College where he worked primarily with the pitchers and catchers while also assisting with recruiting and other facets of team management he guided 20 players to All-North Coast Athletic Conference honors and helped the 2018 squad earn a spot in the NCAC Baseball Tournament Gruenberg has also been the Assistant Coach and Pitching Coach for the Harwich Mariners of the prestigious Cape Cod Summer Baseball League since 2013 where he worked to develop some of the top collegiate pitching talents in the country that appeared in the prestigious league Thirty-four of his pitchers in the league were drafted over the last four years and his 2016 squad set a league record with a 2.00 team ERA he served as the Mariners Youth Clinic Coordinator In addition to his duties with the baseball team at Kenyon Gruenberg was an assistant coach with the football team from 2012-17 coaching wide receivers and linebackers and serving as the Director of Football Operations Gruenberg worked as an assistant coach at John Carroll University for one season helping the team reach the 2012 Ohio Athletic Conference Championship Tournament Gruenberg began his collegiate career pitching for Marietta College including the squad’s 2006 National Championship campaign He went on to earn his Bachelor of Science in Human Development and Family Science from The Ohio State University School and Counseling Psychology from the University of Missouri He is also certified as a Strength and Conditioning Coach by the International Sports Sciences Association Thanks for visiting The use of software that blocks ads hinders our ability to serve you the content you came here to enjoy We ask that you consider turning off your ad blocker so we can deliver you the best experience possible while you are here This website is using a security service to protect itself from online attacks The action you just performed triggered the security solution There are several actions that could trigger this block including submitting a certain word or phrase You can email the site owner to let them know you were blocked Please include what you were doing when this page came up and the Cloudflare Ray ID found at the bottom of this page Connecting decision makers to a dynamic network of information Bloomberg quickly and accurately delivers business and financial information Chairman Martin Gruenberg will step down on Jan ending a career at an agency that struggled with last year’s banking turmoil and then a toxic workplace scandal “It has been the greatest honor of my career to serve at the FDIC,” Gruenberg said in a message Tuesday to agency employees “I have especially valued the privilege of working with the dedicated public servants who carry out the critically important mission of this agency.” ‘architect of Operation Chokepoint 2.0’ Martin Gruenberg to resign Jan 19 Martin Gruenberg is set to exit as FDIC chair with Representative Tom Emmer blasting him as “an architect of Operation Chokepoint 2.0.” News COINTELEGRAPH IN YOUR SOCIAL FEEDMartin Gruenberg the Federal Deposit Insurance Corporation chair and alleged “architect of Operation Chokepoint 2.0,” has reportedly announced he’ll retire on Jan 19 — a day before Donald Trump is inaugurated as United States president Reuters reported on Nov confirmed his departure in a message to FDIC employees saying that he had informed outgoing President Joe Biden of his decision Republican House of Representatives member Tom Emmer blasted Gruenberg on X in response to the news claiming he was “an architect of Operation Chokepoint 2.0 and drove the FDIC into the ground failing to protect his own employees from the toxic work environment that he cultivated.” Source: Tom Emmer Emmer’s comment stems from a May congressional hearing in which Gruenberg testified after an investigation said the FDIC under his watch had fostered a culture that exposed staff to sexual assault Gruenberg’s exit comes six months after he said he would step down and will end his time at the FDIC where he has intermittently served as chair or acting chair since 2005 His exit clears the way for Trump to select a new boss for one of the country’s top banking regulators Nic Carter, a partner at Castle Island Ventures who coined the term “Operation Chokepoint 2.0,” recently claimed that Silvergate likely would have survived had it not been forced into voluntary liquidation by US regulators trying to “decapitate” the crypto industry He claimed an insider at the bank told him Silvergate was forced to cap crypto deposits at 15% or face consequences Crypto companies rely heavily on crypto-friendly banks to accept deposits enable on-ramps for customers and pay expenses Most industry pundits expect a friendlier crypto regulatory environment under Trump after the president-elect campaigned on ending perceived regulatory hostility toward the industry Magazine: Bitcoin dominance will fall in 2025: Benjamin Cowen, X Hall of Flame It was already a stretch to get revamped capital requirements across the finish line unobstructed Now they reportedly face a “no” vote from an outspoken Democrat For those following the race against the clock to revamp capital requirements two things rumored to potentially happen this week didn’t First, Sept. 19 came and went with no new proposal Bloomberg’s sources floated that date as the earliest a rewritten proposal could land Reuters had touted it as a chance for the regulator’s five panel members to discuss changes to the multiagency proposal designed to bring U.S They discussed fintech-bank relationships at the meeting it sounds as though the proposal has an unanticipated opponent: Consumer Financial Protection Bureau Director Rohit Chopra Chopra has privately described the compromise on capital requirements as somewhat of a giveaway to Wall Street banks, Bloomberg reported Friday analysts may have assumed the biggest threat to the reworked Basel proposal came from Republicans who opposed it “We’ve been too focused on reverse engineering a particular capital aggregate — first a significant increase … and now somewhere in between,” McKernan told Bloomberg McKernan last week reiterated his preference for the Basel measure to be withdrawn and re-proposed. The FDIC board’s other Republican, Vice Chair Travis Hill But that leaves three Democrats on the FDIC board It would also run counter to comments Fed Chair Jerome Powell made Wednesday “The idea is that we will move as a group to put this again out for comment and then the comments will come back 60 days later and we'll dive into bringing this to a conclusion sometime the first half of next year,” Powell said at a press conference to discuss the Fed’s interest rate reduction As for when the revamped proposal will land, “we don't have a calendar date for that," Powell said, according to American Banker By the calendar, if the revamped proposal were to be released today (and don’t count out a 4 p.m. Friday Fed decree) a 60-day comment period would mean the earliest a rule could be finalized is Nov 19 — though opponents may argue that new comments would not have been taken into account Republican lawmakers who oppose the measure have long said they would seek to rescind it using the Congressional Review Act under which rules can be halted up to 60 days after they are finalized 18 – two days ahead of the inauguration of a new president but more than two weeks after a new Congress will have come into session if a majority of House members and senators oppose the rule the next White House occupant could sign off on it conventional wisdom would have pointed to two party-line monoliths and if Donald Trump were elected calling it – let’s check against the alleged Chopra wording – “a Wall Street giveaway.” This may be a sign of confidence in Democratic circles that Vice President Kamala Harris will win if a key Democrat like Chopra thought a Republican would take the White House wouldn’t he get behind an effort to get some sort of capital requirements compromise on the books rather than toss it away A representative for Chopra declined to comment to Bloomberg Chair Martin Gruenberg and Office of the Comptroller of the Currency acting chief Michael Hsu both made statements last week emphasizing regulatory cooperation OCC and the FDIC have worked cooperatively on the Basel III proposal including the changes outlined in Vice Chairman Barr’s remarks,” Gruenberg said Sept “I look forward to the agencies working together to bring Basel III to a conclusion that will strengthen bank capital and bolster financial system resilience and stability.” But Bloomberg reported Friday that the Fed’s outsized role in creating 450 pages of revisions to the Basel proposal rewrite left the FDIC and OCC with little voice on the matter that the Fed can’t go it alone to hit a January deadline But past cowboy-like efforts by single regulators who are supposedly in a partnership have often failed in spite of themselves is he denying Gruenberg’s legacy one last chance at redemption Gruenberg has little reason to stick around than to keep a seat warm Then again, if Chopra has proved exceedingly proficient at a specific task in his capacity as an FDIC board member, it’s punctuating the end of the agency chief’s tenure The removal of Todd Harper and Tanya Otsuka may put other regulators at risk Chair Martin Gruenberg warned that deregulatory efforts in the past have often created the conditions for financial crises to emerge and suggested that the similar deregulatory push by the incoming Trump administration could yield similar results.   In a valedictory speech at the Brookings Institution Tuesday afternoon Gruenberg said that innovation in financial products and services is a critical aspect of a healthy financial system But he also said that over his career as a Senate Banking Committee staffer beginning in the 1980s and nearly 20 years as a member of the FDIC board he has seen efforts to loosen prudential standards on banks in the name of fostering innovation lead to financial crises down the road I thought there might be value in sharing some of the lessons of that experience as we head into a period of uncertainty about the future path of financial regulation in the United States and globally," Gruenberg said I offer the observation that while innovation can greatly enhance the operation of the financial system experience suggests it be tempered by careful and prudent management and appropriate regulation and supervision." Gruenberg said the passage of the Depository Institutions Deregulation and Monetary Control Act in 1980 and the Garn-St Germain Act in 1982 lifted some of the Depression-era limits on interest rates banks and thrifts could pay depositors and sanded down other safeguards on thrifts meant to make them more competitive The result of that innovation was the Savings and Loan Crisis in which hundreds of banks failed when interest rate changes put their portfolios underwater.  "While certain deregulatory measures were appropriate for the thrifts to navigate their interest rate-induced losses it is clear in retrospect that the manifestation of risk in one area cannot be dealt with by deregulating other types of risk-taking," Gruenberg said strong and effective supervision is indispensable." the push in the late 1990s to end the Glass-Steagall prohibition against the mixing of investment and commercial banking was meant to foster innovation and led to an era of combination in the banking industry that led to the creation of many of the Global Systemically Important Banks that dominate the industry today But the commingling of commercial banking and the advent of more complex offerings like collateralized debt obligations and derivatives trading made the job of supervising bank holding companies far more difficult which made the ultimate meltdown of the U.S housing market impossible for the banking industry to withstand on its own and harder for regulators to avoid proactively "Modest attempts to curtail risky lending activities through regulatory guidance were met with significant resistance from the industry and Congress Such efforts were often thought to stifle innovation," Gruenberg said "As the mortgage market became over-extended continued demand for highly-rated assets and declining demand for the riskier tranches of mortgage-related securities incentivized financial engineering of new products — such as collateralized debt obligations and credit default swaps — that fueled the demand for continued securitization of non-prime mortgages At the time this financial engineering was considered a form of innovation." 2025 4:12 PM The failures of Silicon Valley Bank Signature Bank and First Republic in the spring of 2023 could also find their antecedents in deregulatory efforts by Congress and Consumer Protection Act in 2018 raised the asset threshold for banks' enhanced prudential standards spelled out in Dodd-Frank from $50 billion to $100 billion leaving the Federal Reserve wide latitude to apply those standards to banks with between $100 and $250 billion of assets.  The application of that law led to many banks between $100 billion and $250 billion of assets not having to submit resolution plans to their regulators comply fully with the liquidity coverage ratio or undertake company-run stress testing which Gruenberg said could have given supervisors more of a chance to head off the banks' failures before it was too late "The deregulatory environment of the time did not help Silicon Valley Bank would not have been in compliance with the full Liquidity Coverage Ratio as it had been applied prior to the implementation of the 2018 law," Gruenberg said "It was not required to undertake company-run stress testing and the transition rules under the 2018 law delayed its supervisory stress test despite its rapid growth Its holding company was not large enough to require a Title I resolution plan The 2018 law also had a chilling effect on supervisors at the time as documented in the Federal Reserve's analysis of the SVB failure." Gruenberg's remarks are a marked contrast with those given by his likely successor, FDIC Vice Chair Travis Hill, last week. In that speech Hill criticized the FDIC and other banking regulators for issuing enforcement actions against banks engaged in relationships with fintech vendors and the de facto prohibition against engagement with cryptocurrency companies saying that approach has a chilling effect on banks who are looking to embrace innovation to gain a competitive edge "A much better approach would have been — and remains — for the agencies to clearly and  transparently describe for the public what activities are legally permissible and how to conduct  them in accordance with safety and soundness standards," he said which has not been the case in recent years." Gruenberg is slated to resign his chairmanship on Jan advanced several significant pieces of policy aimed at undoing Trump-era deregulation in a marathon board meeting today It was the most policy-packed FDIC board meeting we’ve seen this administration – certainly the longest we can recall. For theoretically outgoing Chair Martin Gruenberg, it felt like a kind of regulatory Alamo – a blast of Democratic banking policy before he may depart the embattled federal agency. The DoorDash effect: $107B in economic impact In 2024, DoorDash powered $107B in economic activity through sales for local businesses, from restaurants to grocers to florists. Dashers earned $16.7B, delivering 4 hours per week on average. Local delivery drives real economic impact. Explore the report. President Joe Biden on Thursday said he would nominate Christy Goldsmith Romero to be chair of the Federal Deposit Insurance Corporation to replace the embattled Martin Gruenberg a member of the Commodity Futures Trading Commission would take over an agency that has been in the spotlight for months due to allegations of a toxic workplace culture Gruenberg said he would step down as soon as a replacement is confirmed by the Senate.  Romero is one of two CFTC officials included among four nominees announced by the White House will be nominated as assistant Treasury secretary for financial institutions The president also plans to nominate Gordon I Ito as a member of the Financial Stability Oversight Council and to renominate Caroline A Crenshaw as a Securities and Exchange Commission member Gruenberg’s announcement that he would leave the FDIC followed an independent investigation commissioned by the agency The probe found that the “FDIC has failed to provide a workplace safe from sexual harassment discrimination and other interpersonal misconduct,” the agency said in a May 7 statement The investigation confirmed earlier reporting by The Wall Street Journal.  Romero worked for 12 years at the Treasury Department Among her roles there was special inspector general for the Troubled Asset Relief Program which was created during the financial crisis She also has been counsel to two former SEC chairs and worked in the agency’s enforcement arm praised Romero’s selection and urged the chamber to move quickly on the nomination.    who has been unanimously confirmed by the Senate twice would bring to the FDIC decades of financial services experience including valuable experience as the special inspector general protecting taxpayers at the Troubled Asset Relief Program,” Brown said in a statement and fair regulator who is not afraid to do what’s right.”   was circumspect about Romero but said Gruenberg must leave before she is confirmed “I will review Christy Goldsmith Romero’s nomination to ensure she has the qualities necessary to support employees lead the FDIC through the changes it desperately needs and return credibility to the independent agency,” Scott said in a statement “But let me be clear – Chairman Gruenberg should resign immediately Every day he remains Chairman means the agency can’t move forward and heal or begin the process of restoring a respectable dignified workplace culture at the FDIC.”   Gruenberg has been on the FDIC board for nearly 20 years He was sworn in as chairman in January 2023 He previously was chairman from November 2012 to mid-2018 He was vice chairman from August 2005 to July 2011.    Romero sponsored the agency’s Technology Advisory Committee which examines cybersecurity and emerging technologies such as artificial intelligence and digital assets Next week is shaping up to be a weird splitscreen of a time for bank regulators The Republican House is moving full speed ahead with a semi-annual oversight hearing scheduled for next week Bill Huizenga (R-Mich.) is prepping a resolution to condemn the chair of the Federal Deposit Insurance Corp for failing to cooperate with congressional investigators has abandoned plans to host its own oversight hearing with bank regulators on Tuesday according to three people familiar with the planning it has begun to catalyze significant changes in the bank supervisory and regulatory environment The FDIC is the first mover in this effort Longtime director and sometime Chairman Martin Gruenberg resigned as a director over the weekend prior to the January 20 inauguration If one were to accept reductive descriptions of their respective policy inclinations former Chairman Gruenberg would best be described as having favored very strong regulation and as skeptical of innovation in the banking system appears to favor substantially lighter regulation and to trust the banking system with greater scope for innovation Acting Chairman Hill published a list of ambitious goals for the agency these goals would temper or reverse several of the measures that the Gruenberg-led FDIC considered standout achievements Implementation of these measures would generally require approval by a majority of the FDIC board and in some cases might also require agreement of other bank regulators The President should be able to assure a Republican majority of the five-member board any necessary agreement among the banking  agencies the public notice-and-comment process could well draw out the timing of change and result in final actions that differ from the proposals This note summarizes and comments on the Acting Chairman’s goals as published on January 21: See more » Refine your interests » Back to Top Explore 2025 Readers' Choice Awards Copyright © var today = new Date(); var yyyy = today.getFullYear();document.write(yyyy + " "); JD Supra, LLC Santander UK sets aside £295mn for car finance probe FDIC chair Gruenberg to step down in January  HSBC to relaunch UK ‘Premier’ wealth banking brand ECB warns of AI stock bubble The Financial Conduct Authority said last week that it is seeking a Supreme Court ruling to clarify lenders’ rights to appeal the bank acknowledged “significant uncertainties” regarding potential remediation cautioning that the final financial impact could vary from the amount reserved Lloyds Banking Group has also earmarked £450mn to cover its potential costs Santander UK said it remains well capitalised with significant buffers over regulatory requirements with its CET1 capital ratio rising to 15.4 per cent in Q3 How a car finance ruling is affecting UK banks chair of the Federal Deposit Insurance Corporation opening the door for president-elect Donald Trump to appoint new leadership at the key US banking regulator Gruenberg, a Democrat and Wall Street critic, has led the FDIC for nearly two decades. His exit comes as the FDIC faces critical regulatory challenges, including long-term debt requirements for US regional banks and the revised “Basel III Endgame” capital rules He faced mounting pressure to resign after a 2023 Wall Street Journal report exposed widespread misconduct at the FDIC that questioned his leadership He said in May he would step down once the Senate confirmed his replacement is expected to assume interim leadership and is reportedly being considered for the permanent role by the incoming Trump administration Gruenberg described his tenure at the FDIC as “the greatest honour” of his career HSBC is relaunching its fee-free “Premier” wealth banking brand in the UK aimed at mass affluent customers with £100,000 to £2mn in investable assets according to an interview with Jose Carvalho head of HSBC UK’s wealth and personal banking The offering includes 24/7 customer service financial planning tools and international Carvalho told Reuters that the bank intends to double assets under management in its UK wealth business to £100bn within five years “We think there is substantial growth for us into that segment of 16.5mn customers in Britain which is going to grow to probably close to 18mn in two or three years’ time,” Carvalho said Carvalho revealed that HSBC plans to launch a flagship wealth centre in London’s prestigious Mayfair district next year noting that the bank expects to recover its investment in its Premier offering over time as customers purchase additional products such as wealth management services The European Central Bank cautioned on Wednesday about a potential “bubble” in artificial intelligence-related stocks warning of global market disruptions if investor expectations are not met “This concentration among a few large firms raises concerns over the possibility of an AI-related asset price bubble,” the ECB noted in its biannual Financial Stability Review in a context of deeply integrated global equity markets it points to the risk of adverse global spill overs should earnings expectations for these firms be disappointed.” the ECB also warned that the euro area remains vulnerable to trade fragmentation a risk that could be heightened by US president-elect Donald Trump’s proposed tariff policies could adversely impact growth in the region Your feedback will help us improve our article content Plus: NatWest posts strong Q1 profit ahead of full privatisation Plus: BNY ups office mandate to four days a week Plus: BoE warns of higher loan loss provisions linked to US tariffs Plus: Erste Group in talks to buy 49% stake in Santander Bank Polska Federal Reserve vice chair for supervision Michael Barr chair Martin Gruenberg and acting director of the Office of the Comptroller of the Currency Michael HsuBloomberg News The book has all but closed on the Biden administration's bank regulatory endeavors as top agencies officials agreed to hold off on putting forth or advancing any additional reforms this year During testimony in front of the House Financial Services Committee on Wednesday Federal Reserve Vice Chair for Supervision Michael Barr Chair Martin Gruenberg and Acting Comptroller of the Currency Michael Hsu said while they would not drop ongoing rulemaking processes — including those related to capital long-term debt and liquidity requirements — they also would not attempt to advance any other changes ahead of the Trump administration's ascendance in January and for some of them we've extended the comment period," Gruenberg said "We don't think any of them will be ready for action before the end of the year." The topic was broached repeatedly throughout the three-hour hearing Agency officials said they would continue to pursue low-profile initiatives — including certain data collection programs and joint effort on combating elder fraud — but nothing regarding the high-profile rules that have drawn criticism from the agency Despite the assurances from the Fed, FDIC and OCC, new regulatory pursuits are continuing to emerge from other parts of the Biden administration. Consumer Financial Protection Bureau Director Rohit Chopra, whose agency has championed new causes such as deposit insurance reform in the weeks since the election Rep. French Hill, R-Ark., one of several committee members vying for its gavel in the next administration said this month's electoral outcome demonstrated the American public's opposition to Biden era regulatory pursuits and urged the testifying officials to respect that "The people of the country have elected President Trump "We're going to have change in the independent agencies in the executive branch and so we don't want to spend the last few weeks of the Biden administration fighting over bad policy ideas." Fed Vice Chair Barr said he intends to resume working on the pending proposals with his new counterparts at the other agencies — Gruenberg announced this week his plan to step down on Jan 19 and Hsu can be dismissed by the new president at will — and confirmed that he would remain in his position through the remainder of his vice chairmanship and I intend to serve my fixed term of office," he said Barr has been the subject of much speculation since Donald Trump's electoral victory earlier this month amid reports that the president-elect's transition team is exploring options for stripping Barr and Fed Chair Jerome Powell of their leadership positions or removing them from office altogether Barr said his status on the board is protected by "a number of safeguards" and he would not resign if asked by Trump or someone else within the administration Barr also emphasized his confidence that the Fed can remain insulated from outside political influences despite the once-and-future-president's desire for greater influence over the central bank "The Federal Reserve has been around a long time," Barr said And those values have served the American public very well and I expect them to persist into the future." Agency independence was another theme of the hearing Democrats and Republicans both expressed varying degrees of both support and concern for regulatory independence though the former were more uniformly aligned with regulators on the topic 2024 2:19 PM "The independence of our agencies has been critical to supporting the stability of our economy for more than a century," said Rep I hope my colleagues on both sides of the aisle will join me in supporting you and chair Powell to defend that independence." Rep. Patrick McHenry, R-N.C., the outgoing chair of the committee said he also values the agencies' abilities to operate based on facts and free of overt political sway he argued that the agencies have jeopardized that freedom by failing to adhere to the Administrative Procedure Act and pursuing policies beyond that statutory mandates "This administration's regulators have repeatedly advanced rules that reduce access and increase costs to the financial products used by everyday Americans because of your actions the political independence and authority of your agencies is in danger of being reduced McHenry also blasted the agencies for fighting "the last war" by focusing on reforms aimed at addressing issues related to the banking crisis of 2008 which is likely the last time the three Biden-appointed officials would appear before Congress closes the chapter on their regulatory agenda "The era of post-financial crisis regulation is over," he stated the Biden administrator's apparent last survivor said he is not willing to let go of implementing the reform efforts he helped initiate in the form of the Dodd-Frank Act of 2010 "I do think it's important to finalize the Basel process to raise capital standards to a level playing field across the international system and to take into account the risks that we saw from the global financial crisis that were not yet fully incorporated into our minimum requirements," Barr said adding that the proposal also reflects "lessons learned" from the failure of Silicon Valley Bank about interest rate risk management Several Republicans on the committee used the hearing to excoriate Gruenberg for both presiding over a period of rampant sexual harassment and discrimination at the FDIC and his unwillingness to step down readily "The information that has come out about the pervasive harassment misogyny and toxic workplace culture at the FDIC under your leadership "You have no business continuing to lead this agency preventing the necessary changes from beginning at this agency and for your employees to continue to be a distraction." Democrats on the committee praised Grueberg's efforts to keep the financial system sound and tried to deflect criticism against him by pointing to Trump's announce cabinet appointees, at least two of whom — Pete Hegseth and Matt Gaetz — are facing sexual abuse allegations Waters at one point asked if Republicans "want [Gruenberg to] get up out of his seat and walk out the door?" Ebrima Santos Sanneh and Claire Williams contributed to this report “President Biden should put his money where his mouth is and fire him.” WASHINGTON – Following reports of sexual harassment and discrimination at the Federal Deposit Insurance Corporation (FDIC) Senator Joni Ernst (R-Iowa) offered a resolution on the Senate floor demanding President Biden fire FDIC Chair Martin Gruenberg proving they are putting politics over protecting women in the workplace Watch her full remarks here Watch her push back against Democrats here “I rise today to remind this body that 42 days ago it was confirmed that Martin Gruenberg fueled a toxic workplace culture at the FDIC yet he is still collecting a taxpayer-funded salary President Biden said – and I quote – ‘I’m not joking when I say this: if you’re ever working with me and I hear you treat another with disrespect…I promise you I will fire you on the spot.’ “They sent coworkers unwanted sexual photos of themselves and others and downright sexist comments designed to belittle “As the FDIC’s own hand-picked investigators stated ‘for far too many employees and for far too long the FDIC has failed to provide a workplace safe from sexual harassment the FDIC needs to clean up the raunchy ‘90s frat house Gruenberg has allowed to fester and there’s no better place to start than at the top How can someone who can’t regulate the behavior of the agency be trusted to regulate the banking industry “Public reports say Gruenberg personally looked the other way when it came to sexism “Investigators determined Gruenberg himself had a reputation of – QUOTE ‘losing his temper and interacting with staff in a demeaning and inappropriate way.’ “They also claimed Gruenberg was either unable or unwilling to recognize his failures… except when the writing was on the wall “I am aware Gruenberg has agreed to resign but only after the Senate confirms a replacement “But we all know why he’s refusing to just quit today… “If and when the FDIC chairmanship becomes vacant President Biden has nominated someone to backfill Gruenberg and I look forward to reviewing her record and her credentials But we all know it will take significant time for her to go through the confirmation process and face a vote here in the Senate “Let us be crystal clear about what’s happening President Biden is letting a dirtbag run the FDIC for who knows how long because he cares more about politics than protecting women in the workplace integrity means doing the right thing when no one is looking the FDIC deserves a leader who acts with integrity and Gruenberg’s conduct doesn’t fit the bill the time has come to turn the page on Martin Gruenberg “President Biden should put his money where his mouth is and fire him “But since Biden doesn’t seem to remember his OWN pledge it is the responsibility of the Senate to remind him of it.” The White House on Thursday nominated Christy Goldsmith Romero as chair of the Federal Deposit Insurance Corp. (FDIC) bank regulator following the scandal-induced resignation of Martin Gruenberg Goldsmith Romero, who must still be confirmed by members of the U.S. Senate has been a commissioner at the Commodity Futures Trading Commission (CFTC) since March 2022 She has more than 20 years of experience as a federal attorney and financial regulation leader under four U.S The Conference of State Bank Supervisors (CSBS) issued a statement in which Karen Lawson its executive vice president for policy and supervision “By nominating an individual to the FDIC Board who lacks state bank supervisory experience has ignored the requirements of the Federal Deposit Insurance Act,“ Lawson said “Congress insisted on state supervisory experience on the FDIC Board for a reason: states are the chartering authority and primary regulator for 79% of all U.S State supervisors understand the economic impact that state-chartered banks have on the families and small businesses in their communities Federal supervision and regulation of banks should be guided by the important state and local perspective the Senate should fully explore her positions on critical matters affecting the dual-banking system and the importance of preserving the role of the states in our financial system.“ In November 2023, Gruenberg and the FDIC became embroiled in scandal after an investigation by The Wall Street Journal uncovered years of sexual harassment and misogyny that created a “toxic work environment.” The report noted that ”the agency’s inspector general found the FDIC’s policies for preventing identifying and disciplining sexual harassment fell short.” Last month, an independent investigation by Cleary Gottlieb Steen & Hamilton LLP, a New York-based law firm, “confirmed a workplace culture rife with pervasive sexual misconduct, discrimination and retaliation,“ according to reporting from Politico Although the investigation did not call for Gruenberg’s resignation it also questioned whether he had the “moral authority” to imposed needed reforms and detailed instances in which Gruenberg “lost his temper and berated staff.“ Gruenberg announced his resignation upon the confirmation of his successor He has been a member of the FDIC board of directors since 2005 serving two separate stints as chair as well as multiple stints as acting chair Reuters reported that Senate confirmation hearings for Goldsmith Romero could begin as early as next month with the new chair potentially in place prior to the November presidential election the chairman of the House Financial Services Committee issued a statement Thursday following the nomination of Goldsmith Romero “Another day with Martin Gruenberg at the helm of the FDIC is one too many,” McHenry said “Chair Gruenberg’s successor must be prepared to hit the ground running to implement the Cleary Gottlieb recommendations and end the egregious misconduct that has come to define the agency during his tenure Christy Goldsmith Romero must immediately begin taking steps to reverse the toxic culture overseen by Gruenberg to rebuild trust between FDIC employees and management The Senate must move forward with confirmation proceedings expeditiously to curtail Chair Gruenberg’s ability to further damage the agency and endanger financial stability.” Goldsmith Romero was also an adjunct professor of law at Georgetown University Law Center and the University of Virginia Law School from 2019 to 2021 She taught courses in securities regulation cryptocurrency regulation and federal oversight She also spent six years at the Securities and Exchange Commission (SEC) including as counsel to chairs Mary Schapiro and Christopher Cox during the financial crisis of the late 2000s She earned a law degree from Brigham Young University and an undergraduate degree from Old Dominion University Editor’s note: This article was updated to include comments from the Conference of State Bank Supervisors and website in this browser for the next time I comment Δdocument.getElementById( "ak_js_1" ).setAttribute( "value" Fair housing experts offer their thoughts on what a repeal of CCP and more private listings could mean for members of protected classes Don't have an account? Please Sign Up You are currently accessing Central Banking via your Enterprise account If you already have an account please use the link below to sign in If you have any problems with your access or would like to request an individual access account please contact our customer service team Phone: 1+44 (0)870 240 8859 Email: csqueries@infopro-digital.com chair of the US Federal Deposit Insurance Corporation is stepping down after a review found the regulator had failed to deal with widespread cases of misconduct including complaints against the chair himself I am prepared to step down from my responsibilities once a successor is confirmed,” Gruenberg said on May 20 Until then he said he will continue to lead efforts to improve the FDIC’s workplace culture Only users who have a paid subscription or are part of a corporate subscription are able to print or copy content To access these options, along with all other subscription benefits, please contact info@centralbanking.com or view our subscription options here: http://subscriptions.centralbanking.com/subscribe You are currently unable to print this content. 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View our subscription options If you already have an account, please sign in here RiskTechForum.com and Chartis-Research.com Please use your existing password to sign in All fields are mandatory unless otherwise highlighted If you don’t have a Central Banking account © Infopro Digital Risk (IP) Limited (2025) Published by Infopro Digital Services Limited Companies are registered in England and Wales with company registration numbers 09232733 & 04699701 To use this feature you will need an individual account Alternatively you can request an individual account The Burdick Job Corps (BJC) Center in Minot hosted its combined Community Relations Committee and Workforce Development Council meeting on Wednesday to share updates on successes and opportunities for local businesses to build bridges with the workforce of the next generation the Career Development Services System director shared some career development milestones from the last half of 2024 which he described as a “whirlwind of opportunities.” Two welding students at BJC were chosen for one opportunity and traveled to Pascagoula which is a manufacturing stop for Ingalls Shipyard The Ingalls Shipyard has contracts with the U.S “By the end of the first weekend of December they were both offered a full time job as welders in the shipyard They went down and represented the center very well and themselves at the program,” Gruenberg said 27 they are going back down permanently.” Gruenberg said the two students’ starting pay was about $55,000 Gruenberg said this opportunity was a first for the BJC and the pipeline with the Ingalls Shipyard would continue with other trades as well Gruenberg shared another avenue opening up for BJC culinary students who prepared and served the lunch at the meeting who will have the opportunity in February to travel to Florida to learn and work under chefs at Disney Culinary restaurants “I’m really guarded and protective of the students here they better not go work at the park and I better not see them making hotdogs and fries at one of the kiosks But that’s not what it is,” Gruenberg said “They’ll be able to work on a cruise ship and work under a chef with experience.” BJC culinary students pursuing the experience with Disney Culinary will have to have earned their high school diplomas completed more than 50% of their culinary training and completed their ServSafe food handling and management certifications Gruenberg also spotlighted three BJC students who have started their career paths at Dakota College of Bottineau which he said the Job Corps is considering expanding “The ultimate goal for me and our staff here is that when our students graduate from Job Corps we would love for them to earn 20 bucks an hour That’s the goal,” Gruenberg said Another speaker at the meeting was office administration graduate Gabriel Lima who came to the Burdick Job Corp in 2024 at the age of 21 Lima said his plans for his future were derailed after a traumatic experience heading into his senior year of high school Lima said he struggled after graduating and bounced around the country before he became aware of the Job Corps and took the leap to change the direction in his life Job Corps helped to remind me how much I used to love to learn It reignited my self confidence and confidence in my abilities.” Lima interned at Minot City Hall and is currently pursuing a degree at Minot State University Job Corps Workforce Specialist and Minot Mayor Tom Ross commended Lima for how well he adapted to the work at City Hall are still scratching trying to find a way to get him to work over there while he’s going to school It’s fun to watch students like you grow but also spiritually and in maturity,” Ross said Ross implored local employers to engage with the students and staff at the Job Corp to build even more bridges to develop the future workforce One man has been arrested and another is at large after an attempted burglary in southwest Minot in the early .. Kelly Armstrong has directed all government agencies to fly the U.S Copyright © 2025 Ogden Newspapers of North Dakota | https://www.minotdailynews.com | 301 4th St SE “You have fueled calls for your resignation from the political opportunists across the aisle and jeopardized critical regulations pending finalization at your agency.” Video (YouTube) in a House Financial Services Committee hearing Congresswoman Ayanna Pressley (MA-07) discussed the essential work of the Federal Deposit Insurance Corporation (FDIC) and criticized FDIC leadership and Chair Martin Gruenberg specifically for failing to address reported persistent and widespread sexual harassment at the agency and in turn jeopardizing critical financial regulations pending at the agency The hearing follows damning reports of a toxic work environment at FDIC that detailed rampant sexual harassment and other misconduct under Gruenberg and his predecessors who is herself a survivor of sexual violence and a champion for survivors’ justice also questioned Chairman Gruenberg on why perpetrators of harassment were not held accountable by the agency and urged him to clarify on the record that no employee will face retaliation for reporting harassment A full transcript of the Congresswoman’s exchange with Chair Gruenberg is available below and the full video is available here Ayanna Pressley Calls for Resignation of FDIC Chairman GruenbergHouse Financial Services CommitteeMay 15 The work of the FDIC is paramount in supervising our banks like Community Reinvestment Act and Basel III It was just last year when folks in my district were constantly refreshing the agency’s webpage to see if their money was safe after the failure of Silicon Valley Bank I had initially planned to spend this time discussing regulations and requesting updates from Chair Gruenberg on the timeline for finalizing rules that stabilize our financial system after reading the recent report into the FDIC’s workplace the public needs answers on the toxic culture of racial discrimination and misogyny that has taken root and festered at the FDIC but especially women employees who have brought their knowledge and their skills to serve at the FDIC and you have failed the American public who relies on the agency to work productively and to put forth policies that protect consumers from bank malfeasance I have to just consider the source here when it comes to some of the outrage from my colleagues across the aisle because these are the same people who seek to actively defund diversity who denied and undermined the Me Too Movement who voted against the Violence Against Women Reauthorization and who don’t want to support finally passing the Equal Rights Amendment And that is why I am truly disgusted by the fact that you have created an opportunity for Republicans who did all of those things to advance their anti-regulation agenda and to use survivors – which I am one – of abuse as political pawns and I almost walked out just on the strength of that but the only reason why I didn’t is because that is a systemic issue here in Congress and often for people who come before this committee And if you don’t have one woman in a position of leadership and authority that should be there The report detailed hundreds of women who experienced harassment with no recourse you stated that the FDIC already has “appropriate policies and procedures in place.” and this is a yes or no question – I’m serious – do you now agree that the policies and procedures in place have been a cataclysmic failure and an affront to the many women who have been harassed and forced to change the career goals and life trajectory These are just a few of the words to describe the intense feelings of sexual harassment and what survivors endure According to the FDIC’s own reporting more than 80% of harassment complaints resulted in zero discipline or any discipline more serious than a temporary suspension and deeply unsatisfactory and it is retraumatizing no employee at the FDIC will face any form of intimidation or retaliation for reporting an incident of sexual harassment regardless of confidentiality agreements PRESSLEY: It is shameful that through your inadequate leadership at the helm of this agency that you have fueled calls for your resignation from the political opportunists across this aisle and jeopardized critical regulations I do not have confidence that you can continue to lead in this role because there is a deficit of trust and your credibility has been undermined to lead the FDIC through the changes it needs to make to affirm the dignity of the survivors of harassment Chair Martin Gruenberg declined to testify at a House Financial Services Committee hearing scheduled for Wednesday on workplace misconduct at the agency citing scheduling conflicts.Bloomberg News WASHINGTON — Federal Deposit Insurance Corp Chair Martin Gruenberg will not attend the scheduled House hearing on Wednesday addressing workplace misconduct allegations at the banking agency which an FDIC spokesperson attributed to a scheduling conflict Federal Reserve vice chair for supervision An independent report by law firm Cleary Gottlieb released in early May corroborated allegations that had surfaced in a Wall Street Journal article last fall The report also unearthed additional details including harassment and discrimination as well as criticism of Gruenberg's temper in workplace settings.  Despite Republican calls for his resignation at last month's hearing, the veteran bank regulator managed to retain support from congressional Democrats, though Senate Banking Committee Chair Sherrod Brown, D-Ohio, called for new leadership at the agency, spurring Gruenberg to say he would resign upon the confirmation of a successor including creating an Office of Professional Conduct and firing several employees involved in misconduct He apologized and expressed commitment to changing the agency's culture while acknowledging the hurt caused by these issues Hsu and Jonathan McKernan — who co-chaired a special board committee tasked with overseeing the investigation into the agency's culture — and representatives from Cleary Gottlieb will provide testimony interpreted Gruenberg's conditioning of his resignation on the confirmation of a Democratic successor — and thus retaining a Democratic majority on the FDIC board — as a way to respond to resignation calls without sacrificing Biden bank regulations "The likeliest scenario in our view is that the process to name and confirm a new nominee is strategically slow-walked to ensure that Gruenberg is in the seat and able to cast a vote advancing Democratic bank policies," he wrote in a research note "It is difficult to envision either the White House moving quickly to submit a nominee or the Senate acting with haste on that nomination." today asked Federal Deposit Insurance Corporation (FDIC) Chair Martin Gruenberg if he would like to apologize to his employees for the well-documented harassment and bullying that they endured under his leadership Kennedy also called on Gruenberg to resign so that a more qualified leader could step in to improve the culture at the FDIC “You ought to be ashamed of yourself I'm embarrassed to have to even read some of these allegations,” Kennedy said “These folks on the first row behind you—are they FDIC employees Would you like to turn around and apologize to the female employees sitting behind you at the FDIC?” Kennedy asked Gruenberg then turned and issued a short apology to FDIC employees “And now I think you ought to resign.”  Watch Kennedy’s full exchange with Gruenberg here. indispensable guide to what Trump’s second term means for Washington follow the latest on tariffs and executive orders Stay on top of the latest events in US politics with the FT’s trusted and impartial coverage Insight and analysis on US politics from commentators such as Ed Luce and James Politi This subscription does not include access to ft.com or the FT App Essential digital access to quality FT journalism on any device Complete digital access to quality FT journalism with expert analysis from industry leaders Terms & Conditions apply Discover all the plans currently available in your country See why over a million readers pay to read the Financial Times After months-long scandal over misconduct at top bank regulator Gruenberg said he would step down once a successor is confirmed Federal Deposit Insurance Corporation (FDIC) chairman Martin Gruenberg announced his resignation on Monday amid a months-long scandal over sexual harassment and other misconduct at the top bank regulator Gruenberg said he would step down from his responsibilities once a successor is confirmed a top Democrat had called for Gruenberg to be replaced after an external review found sweeping reports of employee mistreatment and sexual harassment There must be “fundamental changes” at the agency Senate banking committee chairman Sherrod Brown said adding that he wanted Joe Biden to immediately nominate a replacement Brown is the most senior Democrat to call for Gruenberg’s replacement Spokespeople for the FDIC and the White House did not immediately respond to requests for comment Gruenberg testified alongside several other banking regulators before Congress He vowed to take steps to address longstanding cultural issues at the agency after the review found multiple instances in which he lost his temper with subordinates But Republicans and Democrats alike expressed skepticism that Gruenberg would be able to overhaul the agency where he has served for nearly two decades He was sworn in to his current five-year term as chair of the FDIC in January 2023 He had also served as chairman from November 2012 to mid-2018 and receiving further outreach from FDIC employees to the Banking and Housing Committee I am left with one conclusion: there must be fundamental changes at the FDIC Those changes begin with new leadership,” Brown said in his statement Brown did not call for Gruenberg to immediately resign Should Gruenberg leave the agency without a confirmed replacement leadership of the FDIC would fall to Travis Hill The FDIC is working with the Federal Reserve and the Office of the Comptroller of the Currency on several rule-writing projects that would tighten requirements on larger banks including a contentious plan to boost big bank capital requirements The FDIC chairman faced multiple calls for his resignation Wednesday at a House panel hearing where he said four agency employees have been let go this year over misconduct Republican lawmakers didn’t mince words for Federal Deposit Insurance Corp Chairman Martin Gruenberg during a House committee hearing Wednesday charging him with creating the toxic culture issues at the agency and lacking the moral authority to continue leading it Gruenberg, along with Michael Barr, the Federal Reserve’s vice chair for supervision, and Michael Hsu, acting comptroller of the currency, appeared before the House Financial Services Committee; the semi-annual oversight hearing came just days after a scathing third-party audit report of the FDIC was released Since the report’s release, several lawmakers have called for Gruenberg to step down and House Financial Services Committee Chairman Patrick McHenry Multiple Republicans on the committee asserted Wednesday that an executive found to have led a bank with such a toxic workplace culture rife with misconduct would be booted immediately while Gruenberg seeks to hang onto his position called that a “horrible double standard.”  Democrats expressed doubt over Gruenberg’s ability to lead a needed transformation of the agency and sought to understand when and to what extent Gruenberg was aware of the FDIC’s pervasive issues Prior to news reports from The Wall Street Journal last November that detailed the agency’s toxic culture Gruenberg said he was aware of cases being brought forward under the agency’s normal process but not of deep-seated culture issues at the FDIC law firm Cleary Gottlieb determined the FDIC has failed to provide a workplace safe from sexual harassment discrimination and other bad behavior “for far too many employees and for far too long.”  The 234-page report, based on testimony of more than 500 current and former FDIC employees, outlined the agency’s “misogynistic” and “insular” workplace culture where “a widespread fear of retaliation” exists It also revealed several instances when Gruenberg – who has led the agency for 10 of the last 13 years – lost his temper at work Gruenberg said he’s “deeply committed” to the agency and takes full responsibility for the report’s findings He told lawmakers he’s met with some of the FDIC employees who shared their experiences with Cleary Gottlieb and is keenly aware of the impact of their experiences “I also acknowledge my own failures as chairman both in failing to recognize how my temperament in meetings impacted others and for not having identified deeper cultural issues at the FDIC sooner,” he said during his testimony who serves as a member of the FDIC’s board on Wednesday agreed with lawmakers that the report is “highly disturbing” and the issue “severe,” although he believes Gruenberg has accepted responsibility and is fully committed to implementing change at the agency The FDIC accepts all of the Cleary Gottlieb report’s recommendations and has begun implementing some already Gruenberg said during his testimony Wednesday “To restore credibility with our workforce we must act swiftly on the report’s recommendations and demonstrate a commitment to making fundamental change,” he said Those include appointing a transformation monitor who will oversee and report on the FDIC’s implementation of the recommendations and tapping an independent third-party expert to assist with the agency’s efforts The FDIC will issue requests for proposals for those “as early as this week.”  The agency also seeks to establish an independent professional conduct office that would report to the FDIC board to better handle complaints and execute disciplinary action to address misconduct The FDIC has come up with its own action plan seeking to address issues initially raised in The Wall Street Journal reports last November A number of the independent report’s recommendations are already in the FDIC’s plan our Action Plan goes beyond the recommendations in the report.”  That plan is centered on providing more support and resources to victims strengthening the agency’s process for reporting and investigating misconduct complaints and increasing accountability for those found to have engaged in misconduct Gruenberg typically visits each of the FDIC’s six regional offices once a year and such issues weren’t brought up during those meetings present challenges when it comes to misconduct and oversight the agency has to break the “good old boys” network that’s at the core of the report Gruenberg told the committee that four people have been let go from the agency this year related to misconduct and the agency has made management changes “Sounds like you need to fire more people,” said Rep adding that “a lot of people,” not just four allowed the agency’s toxic culture to fester McHenry posited that the FDIC’s workplace issues contributed to last year’s failure of Signature Bank because agency employees were afraid to present Gruenberg with information that could cause him to lose his temper