Money

Senate confirms Trump nominee for top Fed job

Randal Quarles will be banking watchdog

WASHINGTON (CNNMoney) - President Donald Trump has pledged to "do a big number" on the 2010 financial reform law known as Dodd-Frank. Now he has his own point man for the job.

On Thursday, the Senate confirmed Randal Quarles for the Federal Reserve's vice chair of supervision post in a 65-32 vote.

Quarles is the first person to fill the role of banking watchdog at the Federal Reserve. The position was created under the 2010 Dodd-Frank reform law to oversee the country's largest U.S. banks.

"We look forward to working with him on issues of deep importance to our members which promote safe and efficient markets," said Ken Bentsen, president and CEO of SIFMA, a securities trade group said about Quarles.

Quarles, a former top Treasury Department official in the George W. Bush administration, is the founder and managing director of The Cynosure Group, a private equity firm in Salt Lake City.

Former President Barack Obama never nominated anyone for the job. Daniel Tarullo, the former Federal Reserve governor, who stepped down in April, served as the de facto vice chairman for supervision.

Jerome Powell has been serving as the head of the bank oversight committee since Tarullo left.

By filling the post, the Trump administration will now have an opportunity to reshape the post-crisis financial regulatory landscape. The president has repeatedly renewed his pledge to do a "major elimination of the horrendous" Dodd-Frank regulations.

Quarles has already signaled the need to take a second look at the reform law. "There are ways to redefine Dodd-Frank and other forms of regulatory policy in ways that would be beneficial to the economy," Quarles told Bloomberg Television in a November 2015 interview.

Speaking on the Senate floor, Sen. Elizabeth Warren, a key member of the Senate Banking Committee, vehemently opposed Trump's pick, arguing Quarles would work to help the interests of Wall Street and not American families.

Quarles will play a different role overseeing bank supervision than Tarullo. Tarullo was nominated by President Barack Obama in January 2009 to serve as a primary responder in shaping the regulatory landscape following the 2008 financial crisis.

But from his new perch at the Fed, Quarles will be in a position to help steward a comprehensive review of existing regulations to find areas of improvement, rather than building it from scratch.

Before leaving his post earlier in April, Tarullo opened the door to possible changes to the reform law. He signaled out the so-called Volcker Rule, which bans the largest banks from taking risky bets with taxpayer money, as one area revisions could be made. That's at least one area of shared agreement with Quarles, who said the rule is "not well designed."

Still, Tarullo has urged his predecessor and Congress not to completely unwind the entirety of sweeping law aimed at preventing another financial crisis.

"Neither regulators nor legislators should agree to changes that would effectively weaken that regime, whether directly or indirectly," said Tarullo in a speech at Princeton University. "It would be tragic if the lessons of the financial crisis were forgotten so quickly."


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