WASHINGTON — The Senate on Thursday confirmed Randal Quarles 65-32 to join the Federal Reserve Board as a governor and later by voice vote as the first vice chairman of banking supervision.
That position was created by the Dodd-Frank Act of 2010, but was never filled by the Obama administration, which relied on former Fed Gov. Daniel Tarullo to fill the role on a de facto basis.
Quarles will now take center stage in banking supervision and could play a key role in changing the central bank's stress tests, simplifying the Volcker Rule ban on proprietary trading and dialing back capital rules.
Quarles' approval came despite opposition from progressives.
“He has gone through the revolving door so many times it is hard to keep up,” Sen. Elizabeth Warren, D-Mass., said on the Senate floor, opposing Quarles and his close ties to Wall Street.
Quarles was most recently a managing director at the private equity firm Cynosure Group, and previously served as Treasury undersecretary for domestic finance in the George W. Bush administration.
During her speech, Warren said Quarles would do Wall Street’s bidding and pointed to a July nomination hearing where he said banks should be able to see the testing criteria in advance for Fed-run stress tests and that bank capital standards should be “more sensitive to the character of each institution.”
But Quarles received support from Republicans and moderate Democrats.
Senate Banking Committee Chairman Mike Crapo, R-Idaho, spoke in favor of Quarles' confirmation before the vote, citing his “extensive government and private sector experience” and support from six out of the 11 Democrats on the panel.
Quarles was confirmed for one of the seven Fed board of governor seats. There are three vacancies, but Stanley Fischer, vice chairman of monetary policy, intends to step down later this month, which will open up a fourth.
The term for the board seat Quarles will occupy expires in February, while his vice chairman position has a term for four years. He has been renominated for another board term that expires in 2023, but that was not approved by the Senate.
The Financial Services Roundtable commended the pick.
“FSR looks forward to working with Randal Quarles to better tailor the financial regulatory system in a way that meets the needs of America’s modern economy,” said Tim Pawlenty, its chief executive.
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Updated October 5, 2017 at 11:55AM: This story has been updated to reflect a separate Senate vote for Quarles as vice chair of banking supervision.