Today, Ricki Helfer turns over the Federal Deposit Insurance Corp. to Andrew C. Hove Jr.

Her advice to the agency's vice chairman: Be a pessimist.

"The biggest challenge is reminding insured institutions in what are extraordinarily good times that they must pay attention to the potential risks for the future," Ms. Helfer said in a recent interview.

"It is easy to have a short memory about the past when things look so good," she said. "And the past, of course, was the most significant banking and thrift crisis since the Great Depression."

Reflecting on her two-and-a-half-year term as chairman, Ms. Helfer cited as equally important the FDIC's successful campaign to capitalize the thrift fund and her effort to reform the agency internally.

Arriving after the financial crisis of the late 1980s and early 1990s, the first woman to head a banking agency said she threw her energy into transforming "a huge bureaucracy." Her goal was to build a leaner, more businesslike agency that instead of closing institutions alerts them to potential problems in order to keep them open.

"If somebody five or 10 or 50 years from now wants to talk about what Ricki Helfer did at the FDIC, I hope they would say she prepared the FDIC for the future."

While no one can predict what will cause the next banking crisis, Ms. Helfer said, she formed the division of insurance in late 1995 to identify risks that could cause losses at financial institutions.

Escalating chargeoffs from credit card, consumer installment, and subprime loans as well as the year 2000 computer glitch rank highest among present concerns, she said.

Institutions must adjust their credit underwriting standards in the face of escalating personal bankruptcies and be wary of rapid growth in asset categories, she cautioned.

While she was a vocal and visible FDIC chairman, much of Ms. Helfer's energy was focused on revamping the agency through downsizing and cost- cutting.

Since she took its reins, the FDIC has absorbed Resolution Trust Corp. employees and still cut the combined work force by 36%, or 5,000 jobs. Ms. Helfer also leaves behind a blueprint for chopping the staff by another one-third, which would bring the agency's head count to roughly 6,500 by 2000.

"That was by far the most difficult part of my job," she said.

FDIC morale plummeted, and despite official denials, stories persist that Ms. Helfer was an unpopular and overbearing boss.

Ms. Helfer said she asked tough questions to assure the thoroughness of the information on which she based her decisions.

"By and large I think I have been as sensitive to the issues of people around me as I have been also demanding and disciplined," she said. "I would guess I have not been the easiest person that some people have worked for."

When she announced her resignation in March, saying she had met her goals and wanted to spend more time with her husband, Ms. Helfer was going against the grain of her reputation as tireless. Many people are not satisfied by her explanation, she admitted.

"You have to be razor sharp in these jobs, and you have to give them your total attention," she said. "I have done that for more than two and a half years, really to the exclusion of my family and friends."

Her pace reportedly has not slowed in recent months. "She's still probably more intense than most of us are on a normal day," one senior staffer said.

When asked if the lamented incivility of Washington had affected her, the normally quick-speaking Ms. Helfer took a long pause and chose her words carefully.

"This is a very difficult time to be in a senior government position in Washington," said Ms. Helfer, whose confirmation was slowed by the Whitewater scandal and whose agency has been questioned about its oversight of Lippo Bank in Los Angeles.

"One has to devote an enormous amount of energy in the jobs we are in today to making certain that no one has a reason to misunderstand or distort what you are trying to do," she said.

Ms. Helfer plans to take it easy for several months and eventually will lecture and write on banking issues. A former Federal Reserve lawyer and later a partner at the Gibson, Dunn & Crutcher law firm, Ms. Helfer said in order to avoid conflicts of interest, she has not talked to potential employers.

Names have surfaced for her successor, but no nomination is imminent. Observers said they expect Mr. Hove to hold the interim post for at least a year. He inherits some unfinished business and looming controversies.

In several speeches this year, Ms. Helfer has defended the FDIC against reformers who seek to scale back or privatize federal deposit insurance. She criticized a recent Bankers Roundtable proposal to end government backing of the Bank Insurance Fund, cancel the government's so-called "too big to fail" policy for large banks, and limit deposit coverage to $100,000 per person per institution.

"I find it amazing that institutions that clearly benefited from the fact that ... the full faith and credit guarantee was in place in the '80s and early '90s would now propose to take it away," she said.

On financial reform, Ms. Helfer recently testified before the House Banking Committee in favor of affiliations among financial firms but encouraged tightly limiting any combination of banking and commerce.

She also told House lawmakers to merge the bank and thrift insurance funds, which at a combined $36 billion hold the biggest reserves in FDIC history. The timing of the funds' marriage is "unpredictable," she said, but could happen during the current Congress.

Subscribe Now

Access to authoritative analysis and perspective and our data-driven report series.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.