WASHINGTON -- You could call it "The Education of Marianne Wright."
The former thrift examiner, now charged with pioneering the government's examinations of Fannie Mae's and Freddie Mac's finances, says her philosophy was forged during a rocky year at a small California thrift.
The year was 1983, and Ms. Wright was controller of Farmers Savings and Loan in Davis, Calif.
Healthy on paper, the thrift was riddled with problems as it grew at breakneck speed with no internal checks or guidance from its board.
Recalling the experience in a recent interview, Ms. Wright said: "I think that's what made me the type of regulator I think a regulator should be. You have to look at emerging issues and problems."
Ms. Wright went on to examine dozens of West Coast thrifts at the height of the thrift crisis.
Today, as director of examination and oversight at the Office of Federal Housing Enterprise Oversight, Ms. Wright is charged with the scrutiny of the nation's largest financial institutions, formally the Federal National Mortgage Association and the Federal Home Loan Mortgage Corp.
Experts say she must have a clear strategic focus to do her job.
The agencies are immense, they are growing rapidly, and conduct millions of transactions on state-of-the-art equipment.
"There's a tremendous disparity between the resources at her disposal and the task to be performed," said lawyer Thomas Stanton, who has been a leading advocate of closer management scrutiny.
Fully staffed, Ms. Wright will have nine examiners on her team.
"She's charting new ground ...as an examiner of two formidable forces," said a Congressional aide who follows Fannie and Freddie.
"The real issue is to make sure that [management] controls are in place to keep anyone from betting the bank if there are any losses," Mr. Stanton added.
The agencies, which buy and securitize home loans made by lenders, hold loans and have guaranteed mortgage-backed securities worth $1.2 trillion and have issued debt worth another $321 billion.
Though owned by shareholders, the two enterprises were chartered by Congress and enjoy the implicit backing of the federal government.
If they were ever to go belly-up, taxpayers would have to foot a very healthy bill that could dwarf the $150 billion thrift bailout.
Congress, alarmed by the thrift meltdown, formed the Office of Federal Housing Enterprise Oversight in 1992 to monitor the financial soundness of the two agencies.
The office is headed by Aida Alvarez.
Ms. Wright said her first priority is to "understand very methodically" the different lines of business at the agencies, and how each line of business is being managed.
She said she wants to understand "how much guidance the board has given to establishing the parameters of risk" at each agency, and how well management keeps itself informed about risk.
She suggested that her examiners would zero in on whether the agencies are appropriately managing the risk of multifamily loans.
"You can take a single-family loan and put it on your books and put it on the shelf," she said. "You may not do that with a multi-family loan. You have to actively manage it."
She agreed that her examinations into the risks of different lines of business will, for the first time, give the government the hard data it would like to push the agencies to do more for lowerincome borrowers.
"To me it is not mutually exclusive to provide affordable housing and make profits on that," said Ms. Wright. "It's a matter of managing the risk associated with some properties like that."
Ms. Wright was born in Germany just before World War II. Her first vivid memory, she said, is of starting school in a bombed-out building in Berlin in 1945.
She came to the U.S. in 1959, and her first job here was as a teller at the Bank of America, but she quit to get married.
In the mid-70s she went back to school to get a business degree and began a career as an examiner at the California Department of Savings and Loan.
Before coming to the new agency, Ms. Wright spent seven years as assistant regional director in the San Francisco office of the Office of Thrift Supervision.
When she's not examining, Ms. Wright says she likes to read, hike and ride a bike by herself to "get my thoughts together."
She's a traveler, and hopes to go to India soon.