WASHINGTON-With the approach of a new administration, several candidates, including the incumbent NCUA Chairman Michael Fryzel, have already begun jockeying for the top spot at the credit union agency.
The Republican Fryzel, who took office just four-and-a-half months ago, is hoping against long odds to keep his job in the Democratic administration and is discussing the possibility with emissaries from President-elect Barrack Obama.
"We've met with the transition team. All of the (NCUA) Board members have met with the transition team," said Fryzel.
Chicago native Fryzel, who has noted his ties to Illinois politics that gave rise to Obama, and his assertive actions in his short tenure during the historic financial crisis, will help persuade the incoming Democratic administration to retain him as NCUA Chairman. "Nothing was discussed about who should be chairman, but we're confident they'll take into consideration what we've done and what type of job needs to be done," he said. "I'm hoping the president-elect will take into consideration what we've done here."
Fryzel's best bet is the work NCUA is doing to keep limit the financial crisis among credit unions, something he expects to worsen over the coming months, and the possibility the Obama administration will not want to change successful management as the crisis continues. Under his brief tenure, NCUA has taken a number of unprecedented steps, including getting the expansion of the emergency loan fund, the Central Liquidity Facility, through Congress and using it to prop up troubled natural-person and corporate credit unions, as well as funneling CLF funding for the purpose of refinancing at-risk mortgages.
But history is not on Fryzel's side. Observers recall the events surrounding the appointment of Ed Callahan, Fryzel's predecessor and mentor as director of the Illinois Department of Financial Institutions, who was named NCUA Chairman in 1981 by President Ronald Reagan, moving then-chairman Democrat Larry Connell to one of the other seats on the panel. "It's not impossible but highly unlikely," said one former NCUA Board member of the possibility of Fryzel keeping the chair, noting that such political appointments are generally reserved for campaign supporters of the same political party.
Meantime, Gigi Hyland, the sole Democrat on the three-member panel is also reported to be lobbying the Obama team for the job as chairman. But observers say her odds are long too because she was a supporter of Obama's chief rival for the Democratic nomination, New York Sen. Hillary Clinton, and because she has less than three years left on her term. NCUA chairmen are generally appointed that have full terms in order to attract top candidates or political supporters to the job. The full term on the NCUA board is six years.
Other Seat Available
Several other candidates are starting to rear their heads for the third seat on the NCUA Board, currently occupied by Rodney Hood, whose term expires in April. Representatives at the credit union trade groups are reporting they are receiving expressions of interest for the seat.
With two of the seats, and thus control of the Board, now occupied by Republicans (Fryzel and Hood), the Obama administration is almost certain to appoint a Democrat to the vacancy, switching control of the panel. Most observers expect that candidate to be appointed chairman.
The importance of the chair is not lost on Fryzel, as the chairman sets the agenda for the NCUA Board and is the sole spokesperson for the agency.
And Fryzel clearly wants to stay in the corner office on NCUA's seventh floor. Asked if he planned to remain on the Board if he were moved over by the Democrats, he said, "I like this office."
