After a disagreement with Democratic banking regulators, the Republican chairwoman of the Federal Deposit Insurance Corporation, who was chosen by former President Donald J. Trump, said on Friday that she would be stepping down from her position.
Jelena McWilliams, who began her five-year tenure as chair in June 2018, has announced her resignation, which will take effect on February 4, according to a letter to President Biden. She is also resigning from her position as a director on the board of directors of the F.D.I.C. She is the only Republican now serving on the five-member board, and her departure will create a vacancy for the position of vice chair.
In her letter, she said that “during my tenure, the agency remained focused on its essential purpose to preserve and build trust in our financial system.” In the current environment, banks continue to maintain strong capital and liquidity levels in order to encourage lending while also protecting against future losses.
After Rohit Chopra, a member of the Federal Deposit Insurance Corporation board of directors and the new director of the Consumer Financial Protection Bureau, complained earlier this month that Ms. McWilliams had refused to recognise Democratic regulators’ attempts to review rules governing bank mergers, Ms. McWilliams resigned. In an editorial published in The Wall Street Journal, Ms. McWilliams referred to the disagreement as a “hostile takeover” by other board members.
During her time in office, Ms. McWilliams has mostly adhered to Republican ideological principles. President Biden’s plan, which includes altering the federal government’s position on major problems such as climate change and wealth inequality, was hampered as a result of her presence on the campaign trail.
Members of Congress who represent districts in the Federal Deposit Insurance Corporation, which is best known for protecting consumer deposits but also has a role in monitoring all of the nation’s banks, complained that Ms. McWilliams was obstructing efforts by the majority to determine policy.
The political battle for control of the sleepy bank regulator, which some experts suspect is part of a Democratic campaign to remove Ms. McWilliams from her position, broke into the open in early December, according to sources. At an email, Mr. Chopra and two other Democrats on the board — Martin J. Gruenberg, a veteran member, and Michael J. Hsu, the acting comptroller of the currency — voted to solicit public comment on the topic of bank mergers, which was previously discussed in a meeting. Rather than on the F.D.I.C.’s website, a statement about the request was put on the website of the consumer bureau that Mr. Chopra directs. The Food and Drug Administration issued a statement shortly thereafter stating that such a request for feedback had not been authorised.
Democrat board members have ended the bipartisan cooperation that has existed throughout the Federal Deposit Insurance Corporation’s 88-year history, according to Pat Toomey, a Republican who sits on the Senate Banking Committee, who issued a statement on Friday criticising the Democratic board members for doing so.