White House taps Gruenberg for FDIC chair

WASHINGTON — The White House has said it will nominate Martin Gruenberg to serve as chairman of the Federal Deposit Insurance Corp. 

Gruenberg has been acting chairman of the agency since its former head Jelena McWilliams resigned in February. It's his third time atop the FDIC as part of a long career at the agency that spans decades, and would be his second stint as confirmed chairman if the Senate approves the pick. 

The Biden administration previously said they would nominate two Republicans to the their mandated board seats: Travis Hill, previously McWilliams' policy chief, as vice chair of the FDIC, and Jonathan McKernan, senior counsel at the Federal Housing Finance Agency who's been working with the Senate Banking Committee under ranking member Sen. Pat Toomey, R-Pa., for a board slot. The move confused policy watchers, who noted that with Gruenberg unconfirmed, Hill would become acting chairman should the nomination go through without a pick for the accompanying chairmanship. 

Drew Angerer/Bloomberg

At the time, the White House said they would nominate a permanent chair. 

Sen. Sherrod Brown, D-Ohio, chair of the Senate Banking Committee, which is responsible for banking agency nominations, said in a statement that he would now look to move Gruenberg's nomination through the Senate "as swiftly as possible." 

"I applaud President Biden's nomination of Marty Gruenberg to be Chair of the FDIC," Brown said. "Marty has years of experience shepherding the agency through difficult economic times, working with board members of both parties, and taking actions that protect consumers and strengthen the banking system. With experienced leadership at the helm, the FDIC can continue to address risks to our financial system, increase access to affordable financial services to consumers, and ensure that banks honor their commitment to communities across the country through the Community Reinvestment Act." 

Sen. Elizabeth Warren, D-Mass., an influential progressive on the banking committee, agreed, saying in a statement that Gruenberg is "an effective regulator with a proven track record of holding banks accountable," adding that "under his leadership, I am confident that the FDIC will work to ensure that banks serve the needs of American families, not just bank executives."

As acting FDIC Chairman, Gruenberg has tackled core issues that have, at times, been met with criticism from banking trade groups. The FDIC board has raised assessment fees for banks, done away with a supervisory appeals body that banks preferred and reinstated the old model.

He's also joined other regulators in revamping the Community Reinvestment Act, and scrutinizing banks' relationship with crypto companies. He notably cracked down on cryptocurrency-related companies that the FDIC says misleadingly claim deposit insurance, sending cease and desist letters to FTX, among others, to take down questionable statements and to clarify terms. 

Gruenberg has also spoken about the need to toughen resolution requirements for large regional banks, along with his fellow banking regulators. 

Leadership at the FDIC is expected to come under scrutiny under a likely Republican-controlled House in the new Congress. Rep. Pat McHenry, R-N.C., has sent letters questioning the role of Consumer Financial Protection Bureau Director Rohit Chopra in the partisan scuffle over bank merger policy that led to McWilliams' resignation from the agency. 

Gruenberg — along with acting Comptroller of the Currency Michael Hsu, Federal Reserve Vice Chairman of Supervision Michael Barr and National Credit Union Administration chair Todd Harper — is slated to testify before the Senate Banking Committee on Tuesday and the House Financial Services Committee on Wednesday.