Office of Thrift Supervision Director John Reich told employees Thursday that he will leave office Feb. 27.

Mr. Reich, the agency's chief since August 2005, acknowledged in an e-mail to employees that it was "not a good time … for me to leave." The OTS has come under heavy fire for its supervision of major thrifts, including Washington Mutual and IndyMac Bancorp., that failed last year. Several policymakers have also recommended merging the OTS with other banking regulators.

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