Thomas Hoenig's retirement from regulatory work was apparently short-lived.
The former chief executive of the Federal Reserve Bank of Kansas City has been nominated as vice chairman of the Federal Deposit Insurance Corp., the White House said Thursday night.
The choice of Hoenig to be the FDIC's No. 2 would bring to Washington one of the Fed's most outspoken recent voices on regulatory policy. Hoenig, who stepped down just this month after a 20-year stint running the Kansas City bank, was known for his dissenting opinions as a member of the central bank's Federal Open Market Committee.
He has also been critical of the impact of "too big to fail" institutions, as well as efforts to reduce that impact in the Dodd-Frank Act. He would be joining the FDIC at a time when the agency is implementing one of the key reforms of the financial overhaul law: a new resolution system for winding down failing behemoths.
In a recent interview with American Banker, Hoenig took the view that the new law
"The Dodd-Frank bill now defines what a systemically important financial institution is, which makes it now a kind of broad notice that these are the institutions that are 'too big to fail,'" he said in the interview. "That means we will further concentrate our financial system to these powerful few companies, and therefore make it even more fragile in the sense of financial vulnerability to the taxpayer."
If confirmed, Hoenig would succeed Martin Gruenberg as the agency's vice chairman. Gruenberg is currently running the FDIC as the acting chairman, and is awaiting Senate confirmation for the permanent job as head of the agency.
