WASHINGTON — Federal Deposit Insurance Corp. Chairman Sheila Bair said Monday she will step down from her post on July 8.
"It has been a privilege and honor to serve as the head of this great agency during one of the most tumultuous times in the history of our nation's financial system," Bair wrote in a resignation letter to President Obama.
Bair's impending departure has been well-established for months after she indicated she would leave at the end of her five-year term. She was appointed by President Bush in June 2006.
At the helm of the agency, Bair, a former assistant Treasury secretary and university professor, amassed a record as one of the most consequential FDIC chairmen of all time.
Among early voices warning that subprime mortgage losses could wreak havoc on the financial system, Bair's was perhaps the loudest. She became the champion of efforts to fight foreclosures, and equipped the FDIC to focus more intensely on its consumer protection duties. Often butting heads with the industry, Bair pushed for a tough regulatory response as a means to prevent another crisis, all while the agency handled 337 bank failures since the start of 2009 without causing a ripple to system.
Under Bair's influence, the FDIC's powers were significantly expanded by the Dodd-Frank Act, as the law authorized the agency to manage future wind-downs of systemically important financial companies subject to a new resolution regime.
In an internal memo to FDIC employees, Bair said, "We have experienced many challenges together over that period of time and I cannot thank you enough for your dedication."
Bair's future is unclear, although she has signaled an interest in returning to academia or entering the nonprofit world. The FDIC's future is clearer. Vice Chairman Martin Gruenberg, who will likely become the agency's acting chairman after Bair's departure, is expected to be nominated by the White House shortly to succeed Bair.
In her resignation letter, Bair told President Obama, "Please be assured of my deep respect and support for your efforts and those of my regulatory colleagues to assure a healthy and stable financial sector that can support real economic growth and prosperity for this and future generations."
