WASHINGTON | Thu 28 april 2011 10: 21 am EDT
WASHINGTON (Reuters)-the world of bank regulation is not known for full but even within this beige universe Martin Gruenberg has a decidedly low-key public manner.
The current No. 2 man at the Federal Deposit Insurance Corp.--and a strong contender to take over Chairman Sheila Bair in the coming months--speaks at a volume just north of a whisper at meetings of the FDIC Board of Directors.
Those who have worked with him say that Gruenberg is silently in the background as well. They warn, however, not to mistake his low-key style for a lack of strong convictions, including a solid approach to reining in risky bank practices.
"His style is softer but he can be quite fierce when he wants to be," said John Dugan, who served with Gruenberg on the FDIC Board when he was Comptroller of the currency from 2005 to 2010.
This quiet assertiveness can quickly be put to the test, with the FDIC is going toe-to-toe with reckless Wall Street figures such as the Agency reshapes banks capital, redesigns their remuneration packages and forces them to write "living wills" that format how the overthrow of companies can be dismantled by the Government.
Gruenberg, 58, is a leading Democratic candidate to be appointed by President Barack Obama at the head of the FDIC, Bair when the Republican period in June, according to industry and congressional sources ends.
If he doesn't get the nomination, he will probably serve as the Acting President until the Senate confirms Bair of replacement.
Gruenberg the muted style is a stark contrast of Bair, who helmed the Agency since 2006, navigating the financial crisis and the bailouts, calling out well-paid bankers and collides with other supervisors along the way.
Bair has said that she wants to move on to non-profit work or back to the academic world.
WASHINGTON MAN
Gruenberg, who refused to be interviewed, is a native New Yorker and son of immigrants who attended high school in the Bronx before moving to Princeton. Colleagues say he is a die-hard fan of the Yankees.
Despite his New York roots, Gruenberg, has spent his career in Washington. Since the mid-1980s he is grinding away on issues first as a top banking aide to one-time Senate Banking Committee Chairman Paul Sarbanes, a Democrat. He came in 2005 at the FDIC and between November 2005 and June 2006, he served as Acting President, giving him a taste of running of the Agency.
People who have worked with Gruenberg in Congress and the FDIC describe him as a policy wonk who delves into details and takes some time to form an opinion but rarely derogations from that point of view when I makes his spirit.
"He is not a man of many words but when he speaks he makes it very clear what the position is," said Wayne Abernathy, a Republican, who worked with Gruenberg on the banking Commission and is now a top official at the American Bankers Association.
While the Gruenberg CV rich in experience, might be most desirable quality that he has a good chance to be confirmed--a rarity in partisan Washington and a contrast with Elizabeth Warren, whose lack of Congressional support her chances at the head of the new consumer watchdog stumbled.
PRESERVATION OF THE LEGACY BAIR
Observers said that they expect Gruenberg would keep the Agency on the aggressive regulatory path Bair has mapped and a special emphasis on protection of consumers.
Gruenberg threatens to press for a strict implementation of Basel III, and he is actively involved in Basle discussions since joining the FDIC, according to colleagues.
It is a touchy subject among bank executives, and under international regulatory bodies that a consistent approach to capital levels. "It will stifle economic growth and I believe already that," said JPMorgan CEO Jamie Dimon earlier this month about the Basel III framework.
While Bair flash beneficial during the rescue and the writing of Dodd-Frank was, Gruenberg can do good but take a strong diplomatic approach behind the scenes with financial firms. "There is no wish-Ypsilon. You know where he comes from and why, "said Mitchell Glassman, a longtime high FDIC official who the Agency in December and now works for Deloitte Consulting LLP.
Gruenberg would probably keep a lower profile but he knows in order to detain are in every Washington turf battles that might emerge, former colleagues said, a quality that would allow him to do well in the FDIC seat on the multi-regulator financial stability Oversight Council. "I think he would understand that he would have to work with them, but I don't think he would be a laughing stock," said Mark Oesterle, a one-time top aide to Richard Shelby, the top Republican on the Banking Committee.
(Reporting by Dave Clarke, editing by Dave Zimmerman)
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