With six director openings across three federal financial institution regulators – and with a seventh set to open late this summer – there’s much nomination and confirmation work ahead for the administration of President Donald Trump.
But that work will be complicated by restrictions on some of those seats, which represent nearly half (46%) of all director seats at the three agencies with boards, such as those limiting the number of members from any one political party, and (in one case) requiring at least one member to have experience at the state level.
As of today, seats open for nominations are: Two (of the total three) at the National Credit Union Administration (NCUA), with the third seat (that of the chairman) set to expire in August; two (of the total five) at the Federal Deposit Insurance Corp. (FDIC); two (of the total seven) at the Federal Reserve Board. (For more on nominations made, returned to the White House, and renominations, see earlier reporting here.)
In the cases of the NCUA and FDIC, the path forward to achieving full occupancy on their respective boards is somewhat complicated by restrictions by political affiliation on who can sit on the boards.
At the NCUA, federal law requires that “no more than two Board members can be from the same political party.” Assuming that Republican Rodney Hood is confirmed (he was re-nominated last week) and Chairman J. Mark McWatters remains on the board past August, the second open seat would have to be filled by a Democrat.
Meanwhile, at the FDIC, federal law requires that not more than three of the members of the board may be members of the same political party. Chairman Jelena McWilliams (a former staff member of the Senate Banking Committee on the Republican side) and CFPB Director Kathleen (“Kathy”) Kraninger (also a former Republican Senate staffer) are clearly on the GOP side.
But the political affiliation of Comptroller of the Currency Joseph M. Otting – appointed by Trump and confirmed by the Senate in 2017 – is less clear; he is not listed as either Republican or Democrat on any publicly available biography or CV. If he is, in fact, not a Republican, that leaves at least one seat open for another Republican nomination to the FDIC board. In addition, the nominee for that seat (or the other, which could conceivably go to a Democrat) will need to have “state bank supervisory experience” as required under federal law.
Governors on the Federal Reserve Board are not restricted as to their political affiliations. However, membership is restricted by region: no two governors may come from the same Federal Reserve District, of which there are 12 across the country. Of the five current FRB governors: Powell represents the Philadelphia district; Vice Chairman Richard Clarida the Boston district; Vice Chairman for Supervision Randal Quarles the Kansas City district; Gov. Lael Brainard the Richmond district; and Gov. Bowman the St. Louis district.