Top bank regulator announces abrupt resignation

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Comptroller of the Currency Joseph Otting announced his resignation Thursday, vacating his perch at a powerful bank regulator as the pandemic-driven economic collapse threatens the financial system.
The Office of the Comptroller of the Currency (OCC) said in a statement that Otting would leave the agency on May 29, just more than halfway through his five-year term at the independent bank regulator.
OCC chief operating officer and first deputy comptroller Brian Brooks will serve as acting comptroller until a full-time replacement for Otting is confirmed by the Senate. Brooks joined the OCC in 2018 after serving at chief legal officer at Coinbase, a cryptocurrency exchange, and the Federal National Mortgage Association, commonly known as Fannie Mae. ADVERTISEMENT
"It has been my distinct honor to serve the United States and this Administration as the 31st Comptroller of the Currency," Otting said in a statement. "I am extremely proud of what the women and men of the agency have accomplished to promote economic opportunity, eliminate unnecessary regulatory burden, and operate the agency in a more effective and efficient manner."
Otting’s announcement comes two days after several media outlets reported his plans to resign and one day after breaking from two other bank regulators to release new rules for how banks should comply with the Community Reinvestment Act (CRA), a 1977 anti-redlining law.
Neither the comptroller nor the OCC have explained why Otting is stepping down, particularly as banks brace for widespread business closures, bankruptcies, foreclosures and loan losses that could threaten their ability to lend and roil the financial system.
Federal bank regulators and industry advocates say that while the U.S. banks are well capitalized and should be able to weather the downturn, weak points elsewhere in the financial system could cause broader issues.
The Federal Deposit Insurance Corp. (FDIC) said the stress of the pandemic on community banks was the reason it expanded the OCC’s final CRA rules to the banks it oversees. ADVERTISEMENT
Otting expressed confidence in the agency’s ability to handle those threats as they emerge, adding that “the agency and the nation are fortunate that the OCC has a deep bench.”
“Brian and the Executive Committee are extremely well suited to continue the agency's important work and succeed in its mission of ensuring banks operate in a safe, sound, and fair manner,” he continued.
Otting has served as comptroller of the currency since November 2017. He was among the first federal bank regulators appointed by President Trump Donald John Trump Trump taps Brooke Rollins as acting domestic policy chief Trump takes pandemic fight to Michigan Trump to celebrate Memorial Day at Baltimore's Fort McHenry MORE with an eye toward loosening regulations, including rules mandated by the Dodd-Frank Wall Street reform law.
Otting, a former bank executive, was the first former banker to lead the OCC in more than 30 years. His decades of industry experience endeared him to bank advocates and their allies in Congress, who praised him for his efforts to streamline regulations.
“His previous experience as a banker gave him a unique understanding of how the industry can best serve its customers and communities, while also maintaining safety, soundness and consumer protections,” said Rob Nichols, president of the American Bankers Association, the largest trade group for U.S. banks.
Patrick Timothy McHenry Trump campaign launches new fundraising program with House Republicans The Hill's 12:30 Report: Trump turns to lawmakers to advise on reopening Trump taps members of Congress to advise on reopening MORE (N.C.), the ranking Republican on the House Financial Services Committee, praised Otting as “an advocate for modernization” that “made a lasting impact on our nation’s financial system during his time in public service.”
“His support for responsible innovation through financial technology has helped foster new ways to reach unbanked and underbanked Americans,” McHenry said in a Thursday statement.
But Otting’s tenure in the banking sector also evoked suspicion and concern among Democrats and industry skeptics.
Otting’s critics zeroed in on his tenure at OneWest Bank , where he served as chief executive and president while eventual-Treasury Secretary Steven Mnuchin Steven Terner Mnuchin On The Money: GOP senators heed Fed chair's call for more relief | Rollout of new anti-redlining laws spark confusion in banking industry | Nearly half of American households have lost employment income during pandemic Rollout of new anti-redlining rules sparks confusion in banking industry OVERNIGHT ENERGY: New documents show EPA rolled back mileage standards despite staff, WH concerns | Land management bureau grants 75 royalty rate cuts for oil and gas | EPA employees allege leadership interference with science in watchdog survey MORE chaired the bank. Brooks, Otting’s successor, was vice chairman of OneWest until...