Will Democrats stand by Gruenberg?

By Clair Williams

Lawmakers — mostly Republicans — let loose almost immediately after the release of an independent review of the Federal Deposit Insurance Corp.’s workplace culture, calling for the agency’s chairman, Martin Gruenberg, to resign. Those calls, while neither entirely new nor unexpected, were being made by lawmakers farther afield from the usual suspects on the House Financial Services Committee and Senate Banking Committee who are typically involved in financial policy issues….Those hearings could be critical to Gruenberg’s survival at the agency. So far, both the White House and his Democratic allies on Capitol Hill haven’t asked for his resignation, but that could change in the time between the release of the review and his testimony. Lawmakers are receiving closed-door briefings today on the results of the review, according to multiple committee sources familiar with the matter, which could affect lawmakers’ views. I think it’s going to depend on the hearings,” said Karen Petrou, managing partner at Federal Financial Analytics. “I really do.” While Republicans are unified in opposing Gruenberg’s continued time as chairman of the agency, Democrats have been more shaky, she said. They are in a tough position, Petrou said, because of Gruenberg’s importance to the Democratic banking policy agenda, “but on the other hand, if these were allegations about a Republican or a business person, they would be up in arms.”  “It’s going to be touch-and-go,” she said. “If the hearings go well and he holds his ground and nothing new or untoward comes out, he can hold out. If not, not.”