FDIC Chairman Gruenberg Resigns Amid Toxic Labor Crisis

Federal Deposit Insurance Corporation (FDIC) Chairman Martin Gruenberg announced his resignation this week in the wake of a workplace investigation that uncovered a troubling culture of sexual harassment and discrimination at the agency. However, Gruenberg will remain president until a successor is confirmed.

Yahoo Finance’s Jennifer Schonberger digs into the details and provides insight into the potential implications Gruenberg’s resignation could have for future FDIC policies.

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This post was written by Angel Smith

Video transcript

Well, FDIC Chairman Martin Greenberg resigned this week after a recent investigation found that a pervasive culture of sexual harassment and discrimination at the agency was collapsing.

What happens now?

Yahoo Finance’s own Jennifer Schonberger is here, Jennifer.

What happens now?

Good morning, Brad bows to pressure to resign as IC president. Martin Greenberg now says he is prepared to resign less than a week after rejecting bipartisan calls to do so.

A move that could have implications for a proposal to impose stricter capital requirements on banks.

Bloomberg says he will resign once a successor is in place to avoid a scenario that would play out.

Republican FDIC Vice Chairman Travis Hill, something that could derail proposed bank capital requirements.

In a statement Monday evening, Greenberg said: “In light of recent events, I am prepared to step down from my responsibilities once a successor is confirmed. Until that time, I will continue to fulfill my responsibilities as chairman of the FDIC, including the transformation of the work culture of the FDIC S.

Last week, in hearings before the House and Senate, Runberg refused to resign.

His about-face comes after Senate Banking Committee Chairman Sherrod Brown on Monday called on President Biden to nominate a new agency chair to restore the FDIC’s work culture following a hearing with employees of the agency. the FDIC.

Now that Brown did not call for Greenberg’s resignation during a committee hearing last week, the White House says the president will soon introduce a new nominee for FDIC chairman, which they hope the Senate will quickly confirm.

There is now speculation that normally a woman would be a confirmation process and getting someone confirmed can be a very long process and aggravate the wound.

We are in an election year this year and, as mentioned, Greenberg’s departure has implications for proposed bank capital requirements because the FDIC has the right to vote on those proposals.

The candidate could become a target for banks that have been aggressively pushing to relax these proposed rules.

While Democrats favor strict rules, both the FDIC and the Fed have said they are in the process of making broad material changes to those rules.