FDIC's Gruenberg undecided about board seat after he gives up gavel

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WASHINGTON — Federal Deposit Insurance Corp. Chairman Martin Gruenberg said Tuesday that he is on the fence about whether to serve on the agency's board for the remainder of the year even after he is replaced as head of the agency.

Gruenberg's term as chairman officially expired in November, and the Trump administration's nominee to succeed him, Jelena McWilliams, appears to be close to Senate confirmation. However, Gruenberg's term as a member of the FDIC's board of directors does not expire until the end of this year.

“Frankly, I am still trying to figure that one out,” Gruenberg told reporters Tuesday after the FDIC released its quarterly bank earnings report, indicating he has yet to make a decision about whether to stay on the board.

Gruenberg was appointed under President Obama, but it is not uncommon for FDIC board members to be from an opposing party. Traditionally, two members of the board are chosen by the party other than the president's. Indeed, Gruenberg has served on the board since 2005, which was during the George W. Bush administration.

On Monday, former acting Comptroller of the Currency Keith Noreika said Gruenberg would remain on the board “as an independent director until the end of the year.”

Noreika, speaking at a banking conference in Washington, said the FDIC “has the potential for radical change” once McWilliams is confirmed.

She would join two other Trump appointees currently on the board, Comptroller of the Currency Joseph Otting and Mick Mulvaney, the acting head of the Consumer Financial Protection Bureau. The FDIC board’s current vice chair is Thomas Hoenig, whose term as a board member expires in March.

“The FDIC is on the verge of undergoing substantial change,” said Noreika, a partner at Simpson Thacher & Bartlett. “Internally, we should be alert to the possibility of turnover of the FDIC senior staff with the new chairman’s arrival. This may result in changing ways that we do business with the FDIC in Washington.”

Although Gruenberg could not say for certain that he would serve out his term on the board, he said he will continue to chair the FDIC until McWilliams is sworn in.

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