He was among the most prominent critics of the takeover of Credit Suisse by UBS. Now the chairman of the US Federal Deposit Insurance Corporation has announced his resignation. This follows a months-long scandal involving sexual harassment and other misconduct.
Martin Gruenberg, the chairman of the US Federal Deposit Insurance Corporation (FDIC), has announced his resignation. The 71-year-old had come under heavy fire in recent months. An external review had found extensive reports of sexual harassment and other misconduct at the top banking regulatory agency.
Pressure on US President Joe Biden
Gruenberg has now drawn the consequences. On Monday, he announced that he would step down from his responsibilities as soon as a successor is confirmed. According to the report, commissioned from a law firm following revelations by the American newspaper «Wall Street Journal,» Gruenberg himself exhibited a rough demeanor with subordinates.
The chairman of the Banking Committee in the US Senate, Sherrod Brown, called for «fundamental changes» at the agency and urged US President Joe Biden to immediately find a replacement for the FDIC leadership.
Harsh Criticism of Swiss Rescue Plan
Gruenberg was especially known here for his criticism of the takeover of Credit Suisse (CS). In an interview with the «Financial Times,» he expressed his dissatisfaction with Switzerland and its handling of CS. The decision to merge CS with UBS and thus save it was «not a helpful» way to deal with a failing global bank, he said.
He believed that not opting for this was a missed opportunity.
No Fear of Liquidation?
American banking authorities would not shy away from a complete liquidation in a similar situation. «I would resolve J.P. Morgan or another globally systemic bank,» he stated. «We think this is doable.»
The FDIC wants to remind bank shareholders and managers that they cannot rely on government bailouts in emergencies, as they did during the 2008 financial crisis.
