Nov 19, 2021 - Politics & Policy

Biden's top bank regulator nomination at risk after tense hearing

Saule Omarova, nominee for Comptroller of the Currency, at a confirmation hearing on Nov. 18.

Saule Omarova, nominee for Comptroller of the Currency, at a confirmation hearing on Nov. 18. Photo: Anna Moneymaker/Getty Images

A high-stakes battle over the next bank cop just got shoved into the spotlight.

Driving the news: A crucial hearing yesterday — that was ugly and tense at times — made one thing clear: Saule Omarova's shot at leading one of the nation's most powerful financial regulators may be at risk, with growing opposition from both sides of the aisle.

Why it matters: The law professor — a vocal critic, who's put forth proposals that would "end banking as we know it” — is gunning to oversee lenders whose assets make up two-thirds of the banking system's total.

  • If confirmed as head of the Office of the Comptroller of the Currency, Omarova could leave a mark on hugely important issues, including how banks interact with cryptocurrency or lend to controversial industries — and who gets to be a national bank.

The latest: Omarova's critics are getting louder.

  • Republicans claim her academic research suggests support for nationalizing the bank sector. Moderate Democrats don't like that she opposed a law that eased some regional bank regulations — or that she said earlier this year that small oil-and-gas companies should go bankrupt to help “tackle climate change.”
  • During yesterday's hearing before a key Senate panel, Omarova pushed back: She said the fossil fuel industry was “a very important part of the economy” and that her research isn't an endorsement of any one idea.

Catch up quick: The OCC has had temporary leaders — though, acting heads might not feel totally entitled to pursue an aggressive agenda.

  • By the numbers: The office has been without a permanent head for nearly 18 months straight — including the 10 months Biden has been in office, according to data from the nonprofit Partnership for Public Service.

What we're watching: Other Democrats on the committee, including Sen. Elizabeth Warren (D-Mass.), support Biden's pick.

  • Warren said Republicans who oppose Omarova "are doing the bidding of giant banks that want to keep gobbling up smaller competitors, want to keep ripping off their customers, and want to keep getting away with it.”
  • If there’s no Republican support, just one Democratic opposition could sink the nomination. That may extend the regulatory limbo.

One thing looming: A half-century-old anti-redlining law that the next leader could revamp.

What's next: There's no date yet, but the banking committee will vote on whether to advance Omarova — who would be the first nonwhite and first female to permanently get the job — to a full Senate vote.

Go deeper: More Democrats cool on Biden currency comptroller pick

Go deeper