Fed Nominee Nellie Liang Withdraws From Consideration


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WASHINGTON — The White House said Monday that Nellie Liang, an economist and financial regulation expert nominated by President Trump for a seat on the Federal Reserve’s board of governors, had withdrawn her name from consideration.

Ms. Liang, who was nominated in September, faced opposition from the banking industry and Senate Republicans sympathetic to Wall Street’s concerns that she favored overly stringent financial rules.

“We regret to announce that today Nellie Liang notified us that she has withdrawn from nomination to the Federal Reserve Board of Governors,” Lindsay Walters, a White House spokeswoman, said in a statement. “We supported her nomination and believe she would have made a good governor.”

Ms. Liang, 60, is a fellow at the Brookings Institution. She previously spent three decades on the Fed’s staff, rising to lead a department created after the financial crisis to monitor financial stability.

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Nellie Liang, who was nominated by President Trump to serve on the Federal Reserve Board, has withdrawn her name from consideration.CreditBrookings Institution

At the Fed, she helped orchestrate stricter postcrisis oversight of the financial industry, including the creation of annual “stress tests” to determine whether the nation’s banks could withstand a severe economic downturn.

Mr. Trump’s nomination of Ms. Liang was applauded by many current and former Fed officials, who regarded her expertise as a potentially valuable addition to the Fed’s board. The Fed has significantly increased its focus on maintaining financial stability in the aftermath of the financial crisis, when bad bets by big banks helped plunge the American economy into a recession.

But the banking industry has argued that the government overreacted to the crisis and imposed overly restrictive rules that are impeding lending and economic growth. Both the Trump administration and congressional Republicans have pledged to ease the burden of those regulations, despite hefty profits at the United States’ biggest banks. Financial firms had quietly rallied opposition to Ms. Liang’s nomination, arguing that she was not supportive of efforts to recalibrate postcrisis rules.

Jerome H. Powell, the Fed’s chairman, supported Ms. Liang’s nomination and encouraged Senate Republicans to confirm her. But the Senate Banking Committee did not schedule a confirmation hearing in the fall, and Ms. Liang’s nomination expired when the 115th Congress ended this month.

Ms. Liang would have become the first Asian-American to serve on the Fed’s board, and just the 10th woman. She has spent almost her entire professional life at the Fed. She graduated from the University of Notre Dame in 1979, then completed a doctorate at the University of Maryland in 1986. That same year, she joined the Fed’s staff in Washington as a research economist.

Her decision to withdraw from consideration leaves two vacancies on the Fed’s seven-member board.

The Senate also did not act on the nomination of Marvin Goodfriend, an economics professor at Carnegie Mellon University. Now that a new session of Congress is underway, the White House could renominate Mr. Goodfriend, but it has not announced if it plans to do so.



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