S. HRG. 115–241 NOMINATIONS OF JELENA McWILLIAMS, MARVIN GOODFRIEND, AND THOMAS E. WORKMAN HEARING BEFORE THE COMMITTEE ON BANKING, HOUSING, AND URBAN AFFAIRS UNITED STATES SENATE ONE HUNDRED FIFTEENTH CONGRESS SECOND SESSION ON THE NOMINATIONS OF: JELENA MCWILLIAMS, OF OHIO, TO BE CHAIRPERSON AND A MEMBER, BOARD OF DIRECTORS, FEDERAL DEPOSIT INSURANCE CORPORATION MARVIN GOODFRIEND, OF PENNSYLVANIA, TO BE A MEMBER, BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM THOMAS E. WORKMAN, OF NEW YORK, TO BE A MEMBER, FINANCIAL STABILITY OVERSIGHT COUNCIL JANUARY 23, 2018 Printed for the use of the Committee on Banking, Housing, and Urban Affairs ( Available at: http://www.govinfo.gov/ U.S. GOVERNMENT PUBLISHING OFFICE 30–196 PDF WASHINGTON : 2019 VerDate Nov 24 2008 13:56 Feb 05, 2019 Jkt 046629 PO 00000 Frm 00001 Fmt 5011 Sfmt 5011 L:\HEARINGS 2018\01-23 NOMINATIONS\HEARING\30196.TXT SHERYL COMMITTEE ON BANKING, HOUSING, AND URBAN AFFAIRS MIKE CRAPO, Idaho, Chairman RICHARD C. SHELBY, Alabama SHERROD BROWN, Ohio BOB CORKER, Tennessee JACK REED, Rhode Island PATRICK J. TOOMEY, Pennsylvania ROBERT MENENDEZ, New Jersey DEAN HELLER, Nevada JON TESTER, Montana TIM SCOTT, South Carolina MARK R. WARNER, Virginia BEN SASSE, Nebraska ELIZABETH WARREN, Massachusetts TOM COTTON, Arkansas HEIDI HEITKAMP, North Dakota MIKE ROUNDS, South Dakota JOE DONNELLY, Indiana DAVID PERDUE, Georgia BRIAN SCHATZ, Hawaii THOM TILLIS, North Carolina CHRIS VAN HOLLEN, Maryland JOHN KENNEDY, Louisiana CATHERINE CORTEZ MASTO, Nevada JERRY MORAN, Kansas DOUG JONES, Alabama GREGG RICHARD, Staff Director MARK POWDEN, Democratic Staff Director ELAD ROISMAN, Chief Counsel BRANDON BEALL, Professional Staff Member ELISHA TUKU, Democratic Chief Counsel AMANDA FISCHER, Democratic Professional Staff Member COREY FRAYER, Democratic Professional Staff Member DAWN RATLIFF, Chief Clerk CAMERON RICKER, Deputy Clerk JAMES GUILIANO, Hearing Clerk SHELVIN SIMMONS, IT Director JIM CROWELL, Editor (II) VerDate Nov 24 2008 13:56 Feb 05, 2019 Jkt 046629 PO 00000 Frm 00002 Fmt 0486 Sfmt 0486 L:\HEARINGS 2018\01-23 NOMINATIONS\HEARING\30196.TXT SHERYL CONTENTS TUESDAY, JANUARY 23, 2018 Page Opening statement of Chairman Crapo ................................................................. 1 Prepared statement .......................................................................................... 35 Opening statements, comments, or prepared statements of: Senator Brown .................................................................................................. 2 NOMINEES Jelena McWilliams, of Ohio, to be Chairperson and a Member, Board of Directors, Federal Deposit Insurance Corporation ............................................ 4 Prepared statement .......................................................................................... 35 Biographical sketch of nominee ....................................................................... 37 Responses to written questions of: Senator Brown ........................................................................................... 85 Senator Scott ............................................................................................. 89 Senator Rounds ......................................................................................... 89 Senator Menendez ..................................................................................... 90 Senator Schatz ........................................................................................... 90 Senator Cortez Masto ................................................................................ 92 Marvin Goodfriend, Ph.D., of Pennsylvania, to be a Member, Board of Gov- ernors of the Federal Reserve System ................................................................ 5 Prepared statement .......................................................................................... 44 Biographical sketch of nominee ....................................................................... 45 Responses to written questions of: Senator Brown ........................................................................................... 96 Senator Menendez ..................................................................................... 98 Senator Warner ......................................................................................... 99 Senator Schatz ........................................................................................... 101 Senator Cortez Masto ................................................................................ 102 Thomas E. Workman, of New York, to be a Member, Financial Stability Oversight Council ................................................................................................. 6 Prepared statement .......................................................................................... 74 Biographical sketch of nominee ....................................................................... 75 Responses to written questions of: Senator Brown ........................................................................................... 105 Senator Scott ............................................................................................. 107 Senator Warner ......................................................................................... 107 Senator Schatz ........................................................................................... 107 Senator Cortez Masto ................................................................................ 108 ADDITIONAL MATERIAL SUPPLIED FOR THE RECORD Letters submitted in support of the nomination of Jelena McWilliams .............. 111 Letters submitted in support of the nomination of Marvin Goodfriend .............. 115 Letters submitted in support of the nomination of Thomas E. Workman .......... 120 (III) VerDate Nov 24 2008 13:56 Feb 05, 2019 Jkt 046629 PO 00000 Frm 00003 Fmt 5904 Sfmt 5904 L:\HEARINGS 2018\01-23 NOMINATIONS\HEARING\30196.TXT SHERYL VerDate Nov 24 2008 13:56 Feb 05, 2019 Jkt 046629 PO 00000 Frm 00004 Fmt 5904 Sfmt 5904 L:\HEARINGS 2018\01-23 NOMINATIONS\HEARING\30196.TXT SHERYL NOMINATIONS OF JELENA MCWILLIAMS, MARVIN GOODFRIEND, AND THOMAS E. WORKMAN TUESDAY, JANUARY 23, 2018 U.S. SENATE, COMMITTEE ON BANKING, HOUSING, AND URBAN AFFAIRS, Washington, DC. The Committee met at 10:05 a.m. in room SD–538, Dirksen Sen- ate Office Building, Hon. Mike Crapo, Chairman of the Committee, presiding. OPENING STATEMENT OF CHAIRMAN MIKE CRAPO Chairman CRAPO. This hearing will come to order. This morning we will consider the nominations of Ms. Jelena McWilliams to be the Chairperson of the Federal Deposit Insurance Corporation; Dr. Marvin Goodfriend to be a Member of the Board of Governors of the Federal Reserve System; and Mr. Thomas Workman to be a Member of the Financial Stability Oversight Council. Welcome to all of you and congratulations to you on your nomi- nations. I see friends and family sitting behind you, and I welcome them here as well today. We are fortunate to have three highly qualified individuals to consider for these positions, which are critical to ensuring a safe, sound, and vibrant financial system and a healthy, growing econ- omy. I am particularly excited that one of these nominees, Ms. McWilliams, is a former staffer of mine, and is no stranger to the Members of this Committee who have been on this Committee over the past several years. Ms. McWilliams did outstanding work while she was at the Committee, and I am fully confident she will bring the same diligence, work ethic, and intellect to the FDIC that she showed here. In addition to working at the Committee, Ms. McWilliams also worked as an attorney at the Federal Reserve during the financial crisis, and she currently is the Chief Legal Officer, Corporate Sec- retary, and Executive Vice President of Fifth Third Bank. These varied experiences have provided her with the particular background and expertise needed to run the FDIC. As head of the FDIC, Ms. McWilliams would be in charge of administering the De- posit Insurance Fund. Additionally, in its role as a prudential regu- lator, the FDIC plays a critical role in ensuring the safety and (1) VerDate Nov 24 2008 13:56 Feb 05, 2019 Jkt 046629 PO 00000 Frm 00005 Fmt 6633 Sfmt 6633 L:\HEARINGS 2018\01-23 NOMINATIONS\HEARING\30196.TXT SHERYL 2 soundness of the financial system while also promoting economic growth. Dr. Goodfriend also has an impressive background, having worked at the Federal Reserve Bank of Richmond for close to 30 years. He has written extensively about monetary and regulatory policy, and he testified before this Committee in 2016. The Fed is currently in the midst of normalizing monetary policy by winding down its balance sheet and raising interest rates after years at the zero lower bound. With respect to regulatory policy, the Federal Reserve is review- ing many of the rules put in place following the crisis. If confirmed, I look forward to working with Dr. Goodfriend on further regu- latory and monetary policy improvements. Finally, we will consider Mr. Workman to serve as the inde- pendent insurance expert on the Financial Stability Oversight Council. The Council is charged with identifying risks and respond- ing to emerging threats to financial stability, which has significant implications for both banks and nonbank financial companies. Mr. Workman will be well equipped and is well equipped to fill the insurance expert role, bringing over four decades of practical insurance industry