Uncertainty at FDIC as Chopra, Gruenberg Seek to Sideline McWilliams

In a highly unusual move, at least two of the FDIC’s four board members today said they have approved a request for public comments on the agency’s rules for bank mergers and acquisitions. However, the FDIC officially denied this assertion. “Earlier today, the Consumer Financial Protection Bureau posted on its website a document, purportedly approved by the FDIC, requesting comment on bank mergers,” the agency said in a statement. “No such document has been approved by the FDIC.”

A statement from FDIC Board Member Martin Gruenberg and CFPB Director Rohit Chopra, also an FDIC board member, indicated that the board members taking part in this action have directed the FDIC’s executive secretary to publish a request for information in the Federal Register, upon which a 60-day window for comments will follow. They did not indicate under which FDIC bylaws or procedures their action might be valid.

“The FDIC has longstanding internal policies and procedures for circulating and conducting votes of its Board of Directors, and for issuing documents for publication in the Federal Register,” the FDIC said. “In this case, there was no valid vote by the Board, and no such request for information and comment has been approved by the agency for publication in the Federal Register.”

Senate Banking Committee Ranking Member Pat Toomey (R-Pa.) sharply criticized the move and called on the Biden administration to disavow it. “In its history, the bipartisan FDIC board has generally worked in cooperative fashion no matter which party controlled the White House,” Toomey said. “This unprecedented, illegitimate attempt to depose a bona fide and Senate-confirmed chairman would severely weaken the ability of independent regulators to operate free from political interference.”