Sheila Bair

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Sheila Bair
Sheila Bair.jpg
President of Washington College
In office
2015–2017
Preceded byJack Griswold
Succeeded byKurt Landgraf
Chair of the Federal Deposit Insurance Corporation
In office
June 26, 2006 – July 8, 2011
PresidentGeorge W. Bush
Barack Obama
Preceded byMartin Gruenberg (Acting)
Succeeded byMartin Gruenberg
Assistant Secretary of the Treasury for Financial Institutions
In office
July 2001 – June 2002
PresidentGeorge W. Bush
Preceded byGregory Baer
Succeeded byWayne Abernathy
Chair of the Commodity Futures Trading Commission
Acting
In office
August 21, 1993 – December 21, 1993
PresidentBill Clinton
Preceded byWilliam Albrecht (Acting)
Succeeded byBarbara Holum (Acting)
Personal details
Born
Sheila Colleen Bair

(1954-04-03) April 3, 1954 (age 67)
Wichita, Kansas, U.S.
Political partyRepublican
Spouse(s)Scott Cooper
Children2
EducationUniversity of Kansas (BA, JD)

Sheila Colleen Bair[1] (born April 3, 1954)[2] was the 19th Chair of the U.S. Federal Deposit Insurance Corporation (FDIC),[3] during which time she assumed a prominent role in the government's response to the 2008 financial crisis. She was appointed to the post for a five-year term on June 26, 2006 by George W. Bush through July 8, 2011.[4][5] She was also the 28th president of Washington College in Chestertown, MD, the first female head of the college in its 234-year history, a position she held from 2015 until her resignation in 2017.[6]

Early life[edit]

Bair is a native of Independence, Kansas. Her father, Albert, was a surgeon. Her mother, Clara, was a nurse and housewife. She received her bachelor's degree in philosophy from the University of Kansas in 1975,[7] and worked as a bank teller for a brief period, before receiving a J.D. from the University of Kansas School of Law in 1978. In 1981, she was recruited by Senator Bob Dole, a Republican from her state, to serve as counsel on his staff in Washington.[citation needed]

Career[edit]

Pre-FDIC career[edit]

Prior to her appointment at the FDIC, Bair was the Dean's Professor of Financial Regulatory Policy for the Isenberg School of Management at the University of Massachusetts Amherst, a post she had held since 2002. She also served as Assistant Secretary for Financial Institutions at the U.S. Department of the Treasury (2001 to 2002), Senior Vice President for Government Relations of the New York Stock Exchange (1995 to 2000), a Commissioner and Acting Chair of the Commodity Futures Trading Commission (1991 to 1995), and Research Director, Deputy Counsel and Counsel to Kansas Republican Senate Majority Leader Bob Dole (1981 to 1988).

While an academic, Bair also served on the FDIC's Advisory Committee on Banking Policy. Bair also pursued a seat in the U.S. Congress (she lost the 1990 Republican nomination in the 5th Kansas district by 760 votes to Dick Nichols).[8] Bair began her career in the General Counsel's office of the former U.S. Department of Health, Education, and Welfare.[9]

FDIC tenure[edit]

Bair was appointed to the 19th Chair of the U.S. Federal Deposit Insurance Corporation (FDIC) on June 26, 2006 by George W. Bush.[4] She left the FDIC on July 8, 2011, when her five-year term expired.[10][11] She became a senior advisor to The Pew Charitable Trusts in August 2011.[12] She is chair emerita of the Systemic Risk Council, a volunteer effort formed by the CFA Institute and the Pew Charitable Trusts to monitor and comment on regulation.[13][14] Bair's book Bull by the Horns: Fighting to Save Main Street from Wall Street and Wall Street from Itself was published September 25, 2012. The book was a New York Times and Wall Street Journal best seller.[15] Bair has also written three books for children that encourage savings: Rock, Brock and the Savings Shock (2006), Isabel's Car Wash (2008) and Bullies of Wall Street (2015).

Post-FDIC career[edit]

During the 2012 presidential election, Bair was a critic of Republican nominee Mitt Romney, and indicated she would "probably" write-in former Governor of Utah Jon Huntsman Jr..[16]

In May 2015, Bair was appointed president of Washington College, becoming the first female head of the college in its 234-year history. During her tenure as president, Bair helped implement several debt-reducing programs aimed at making a degree more affordable, including “Fixedfor4,” which guarantees tuition costs will not rise for students during their four years at college, and “Dam the Debt,” which awards scholarships to graduating seniors to help pay off federal student loans.[6][17] Bair resigned on June 30, 2017, citing the demands of the job and insufficient time with her family.[18]

Since leaving government service, Bair has served on a number of corporate boards. She is currently on the boards of Bunge Limited,[19] Lion Electric,[20] and Fannie Mae.[21] In November 2020, Bair was named the first woman Chair of Fannie Mae's Board of Directors.[22] Bair previously was on the boards of Host Hotels & Resorts,[23] the state-run Industrial and Commercial Bank of China (2017 to 2020), Thomson Reuters and Santander.[24][25][26] She was criticized for joining the board of Santander, a Spanish banking group, which critics viewed as inconsistent with her public views on the revolving door.[27] She has also served on a number of nonprofit boards, including as a founding director of the Volcker Alliance, the Center for Responsible Lending, the RAND Corporation, and the National Women's Law Center.[28][29]

In 2021, Bair was appointed to a group advising the International Financial Reporting Standards Foundation (IFRS) on setting up the International Sustainability Standards Board (ISSB), which aims to create a set of global standards for firms reporting the impact of climate change.[30] Also in 2021, Ms. Bair was appointed a trustee of Economists for Peace and Security, a group of renowned economists and public servants concerned about issues of peace, conflict, war, and the world economy.[31]

Bair is married to Scott P. Cooper and has two children, Preston and Colleen.

2008 financial crisis[edit]

Bair assumed a prominent role in the government's response to the 2008 financial crisis, working alongside and sometimes publicly opposing Treasury Secretary Hank Paulson and Tim Geithner, then president of the New York Federal Reserve. She also helped shape the resulting Dodd–Frank Wall Street Reform and Consumer Protection Act of 2010.[10][32]

Shortly after taking charge of the FDIC in June 2006, Bair began warning of the potential systemic risks posed by the growing trend of subprime-mortgage-backed bonds. In the spring of 2007 she met privately with industry executives, urging them to modify adjustable-rate mortgages rather than allow homes to go into foreclosure, which could set off a cascading effect throughout the economy.[10][33] In October 2007, Bair took her argument public with an op-ed in The New York Times.[34]

Within the Bush administration, Bair's mortgage modification argument was initially at odds with the Treasury Secretary who believed such action would have little effect. Bair also resisted many of the government bailouts of insolvent banks; rather she argued that the government should impose greater accountability by forcing those institutions to sell off bad assets, replace management and re-privatize them, more akin to how the FDIC handles smaller banks. Bair argued that when companies are viewed as “too big to fail” it leads to reckless behavior because there is an implicit guarantee of government support.[33] Bair favored “market discipline,” meaning shareholders and bondholders would take losses when an institutional fails.[10]

Bair fought against the Federal Reserve's adoption of the Basel II advanced approaches, which would have allowed large banks to use their own internal models to help set their regulatory capital requirements.[10][35] In the aftermath of the crisis, Bair pressed the Basel Committee on Banking Supervision to adopt strong capital and leverage standards.[36] She successfully argued for international adoption of ‘Leverage Ratio’ – a strict capital requirement applying to all of a bank's assets to complement more subjective capital standards based on the perceived riskiness of a bank's assets.[37]

The Troubled Asset Relief Program included a mortgage-relief plan partially modeled on Bair's loan-modification ideas.[33] Following the crisis, the Dodd–Frank Wall Street Reform and Consumer Protection Act was drafted with a number of provisions Bair sought, including the FDIC's expanded powers to seize large financial institutions, place agency examiners on-site within banks, recover pay from executives deemed responsible for an institution's failure, and the requirement of banks to create a ‘Living Will’ as a guide for orderly resolution.[32]

In a fictional TV movie about the crises, Patricia Randell played Bair in the 2011 HBO movie Too Big to Fail, based on the popular book of the same name by New York Times journalist Andrew Ross Sorkin.[38]

2020 Coronavirus pandemic[edit]

In March 2020, Bair called for the Federal Reserve to focus on getting credit flowing to U.S. businesses affected by the spreading coronavirus and workers losing their jobs.[39] In an op-ed for the Financial Times, Bair called for the Federal Reserve and other central banks to require systemically-important banks to suspend discretionary bonuses, dividends and shareholder buybacks in order to impede losses while expanding their balance sheets to support increased borrowing from businesses hurt by the pandemic.[40] The Bank of England and European Central Bank subsequently pressed their banks to do so.[41][42]

Reputation[edit]

In 2009, Bair was named one of Time magazine's "Time 100" most influential people.[43] In 2008, Bair topped The Wall Street Journal's annual 50 "Women to Watch List."[44] In 2008 and 2009, Forbes ranked her as the second most powerful woman in the world behind German chancellor Angela Merkel. Forbes described her FDIC office as "the last stop for capital-starved banks (and their insured customers) before going under."[45]

Awards[edit]

Bair received the John F. Kennedy Profile in Courage Award and Hubert H. Humphrey Civil Rights Award.[46]

In 2009, Bair was presented the Consumer Federation of America's Philip Hart Public Service Award.[47] In 2011, Bair was named of named one of America's Top Leaders by The Washington Post and Harvard's Center for Public Leadership.[48]

On March 29, 2012 Bair was honored by the Romney Institute of Public Management (BYU Marriott School of Management) as the Administrator of the Year.[49][50]

Publications[edit]

  • Bair, Sheila (2012). Bull by the horns : fighting to save Main Street from Wall Street and Wall Street from itself. New York: Free Press. ISBN 9781451672480. LCCN 2012039342.
  • Bair, Sheila; illustrated by Judy Stead (2008). Isabel's car wash. Morton Grove, Illinois: Albert Whitman & Co. ISBN 9780807536520. LCCN 2007030956.
  • Bair, Sheila; illustrated by Barry Gott (2006). Rock, Brock, and the savings shock. Morton Grove, Illinois: Albert Whitman & Co. ISBN 9780807570944. LCCN 2005026974.
  • Bair, Sheila (2015). The Bullies of Wall Street. New York: Simon & Schuster. ISBN 9781481400879. LCCN 2014005948.

References[edit]

  1. ^ "Presidential Nomination: Sheila Colleen Bair". The White House website via Archives.gov. 2006-05-01. Retrieved 2009-03-08.
  2. ^ Howard, Theresa (2008-10-03). "FDIC's Bair emerges as key player in bank rescues". USA Today.
  3. ^ "FDIC: Board of Directors & Senior Executives". Fdic.gov. Archived from the original on 2010-11-23. Retrieved 2010-10-17.
  4. ^ a b "FDIC: Board of Directors & Senior Executives". FDIC. Archived from the original on 23 November 2010. Retrieved 9 July 2011.
  5. ^ Dash, Eric (9 May 2011). "F.D.I.C. Chairwoman to Leave in July". The New York Times. Retrieved 23 September 2020.
  6. ^ a b Seltzer, Rick (2 June 2017). "Bair Resigns From Washington College". Inside Higher Ed. Retrieved 23 September 2020.
  7. ^ "Bair, Sheila C.". Current Biography Yearbook 2010. Ipswich, MA: H.W. Wilson. 2010. pp. 23–26. ISBN 9780824211134.
  8. ^ Cope, Debra; James Swann (October 2006). "Full plate, Open mind: Meet FDIC chairman Sheila Bair". Community Banker. Retrieved 2009-02-01.[dead link]
  9. ^ "FDIC: Tapping the Unbanked Market: Helping People Enter the Financial Mainstream". Fdic.gov. Archived from the original on 2010-12-05. Retrieved 2010-10-17.
  10. ^ a b c d e Nocera, Joe (9 July 2011). "Sheila Bair's Bank Shot". The New York Times. Retrieved 11 November 2020.
  11. ^ "FDIC Chairman Sheila Bair leaving agency". USA Today. 2011-05-09.
  12. ^ The Pew Charitable Trusts (2011). Former FDIC Chair Sheila C. Bair to Join Pew as Senior Advisor Archived 2012-09-09 at archive.today. Retrieved May 12, 2012.
  13. ^ "Former FDIC Chair to Lead Systemic Risk Council". 2012-06-06.
  14. ^ Long, Long; Hannah (21 August 2019). "Former FDIC Chair Joins Fannie Mae's Board". American Banker. Retrieved 28 November 2020.
  15. ^ "Bull by the Horns". Simon&Schuster. Retrieved 14 December 2020.
  16. ^ Slack, Donovan. "Former FDIC chair 'disappointed' by Obama but 'aghast' at Romney". POLITICO. Retrieved 2021-10-18.
  17. ^ Nasiripour, Shahien (26 September 2016). "Sheila Bair Called the Financial Crisis. Here's Her New Nightmare". Bloomberg. Retrieved 10 December 2020.
  18. ^ Campbell, Colin; Anderson, Jessica (5 June 2017). "Washington College appoints Kurt M. Landgraf new president". The Baltimore Sun. Retrieved 23 September 2020.
  19. ^ Doe. "Board of Directors". Bunge. Retrieved 23 September 2020.
  20. ^ "Board of Directors". Lion Electric. Retrieved 2021-06-28.
  21. ^ "Fannie Mae names former FDIC chair Sheila Bair to board". Reuters. 21 August 2019. Retrieved 23 September 2020.
  22. ^ "Fannie Mae Names Sheila C. Bair as New Chair of the Board of Directors". Fanniemae.com. 4 November 2020. Retrieved 24 November 2020.
  23. ^ "Management Team". Host Hotels. Retrieved 23 September 2020.
  24. ^ Miller, Matthew (March 27, 2017). "China's ICBC appoints former FDIC chief Bair as independent director". Reuters. Retrieved November 11, 2019.
  25. ^ Harrison, Crayton (23 May 2014). "Thomson Reuters Adds Former FDIC Chairman Sheila Bair to Board". Bloomberg News. Retrieved 13 October 2020.
  26. ^ Dayen, David (29 April 2020). "Sheila Bair Floated as Bailout Oversight Panel Chair". The American Prospect. Retrieved 23 September 2020.
  27. ^ William Alden (January 27, 2014). "Bair, Critic of the Revolving Door, Joins Board of Santander". New York Times. Retrieved 18 August 2014.
  28. ^ "Sheila C. Bair". Volcker Alliance. Retrieved 13 October 2020.
  29. ^ "My Favorite Things, Part II". Rand.org. 7 January 2014. Retrieved 13 October 2020.
  30. ^ Jones (7 June 2021). "New global sustainability disclosures board draws heavyweight backing". Reuters. Retrieved 1 July 2021.
  31. ^ "Board of Trustees". Economists for Peace & Security. Retrieved 2021-07-21.
  32. ^ a b Solomon, Deborah (7 July 2011). "Bair's Legacy: An FDIC With Teeth". The Wall Street Journal. Retrieved 13 November 2020.
  33. ^ a b c Lizza, Ryan (29 June 2009). "The Contrarian". The New Yorker. Retrieved 12 November 2020.
  34. ^ Bair, Sheila (19 October 2007). "Fix Rates to Save Loans". The New York Times. Retrieved 11 November 2020.
  35. ^ Tooze, Adam (2019). Crashed: How a Decade of Financial Crises Changed the World. New York City: Penguin Books. pp. 87–88. ISBN 9780143110354.
  36. ^ Basel Committee said to consider 3% surcharge on biggest banks
  37. ^ Tooze, Adam (2019). Crashed: How a Decade of Financial Crises Changed the World. New York City: Penguin Books. pp. 313–315. ISBN 9780143110354.
  38. ^ "Patricia Randell". Ensemble Studio Theatre. Retrieved April 3, 2019.
  39. ^ Wiltermuth, Joy. "Exclusive: Fed is 'throwing money in the wrong place,' says Sheila Bair, former top banking regulator". MarketWatch. Retrieved 2020-03-18.
  40. ^ Bair, Sheila (22 March 2020). "Force global banks to suspend bonuses and payouts". Financial Times. Retrieved 10 October 2020.
  41. ^ Makortoff, Kayleena (31 March 2020). "UK banks agree to scrap £8bn dividends amid recession fears". The Guardian. Retrieved 10 October 2020.
  42. ^ "ECB tells banks to skip dividends, buybacks until October". Reuters. 27 March 2020. Retrieved 10 October 2020.
  43. ^ Sellers, Patricia (30 April 2009). "2009 TIME 100: Sheila Bair". Time. Retrieved 24 November 2020.
  44. ^ Donner, Francesca (10 November 2008). "Women to Watch 2008: Sheila Bair Takes Top Spot". The Wall Street Journal. Retrieved 24 November 2020.
  45. ^ "Forbes Most Powerful Women #2 Shelia C. Bair". Forbes.com. August 27, 2008. Retrieved 2011-07-18.
  46. ^ "FDIC chair Sheila Bair to give 2010 Dole Lecture - KU News". University of Kansas. Retrieved 2010-10-17.
  47. ^ "Thirty-Ninth Annual Awards Dinner" (PDF). Consumer Federation of America. June 17, 2009. Retrieved 2013-01-21. (hard to view)
  48. ^ Fox, Tom (29 November 2011). "Sheila Bair: The former FDIC chairman's 20-20 foresight". The Washington Post. Retrieved 28 November 2020.
  49. ^ "BYU MPA Administrator of the Year". mpa.byu.edu. Archived from the original on 2012-05-19. Retrieved 2012-03-30.
  50. ^ "Administrator of the Year and Graduation Banquet". mpaa.byu.edu. Archived from the original on 2012-04-19. Retrieved 2012-03-30.

External links[edit]

Political offices
Preceded by
Chairperson of the Commodity Futures Trading Commission
Acting

1993
Succeeded by
Preceded by
Assistant Secretary of the Treasury for Financial Institutions
2001–2002
Succeeded by
Preceded by
Chairperson of the Federal Deposit Insurance Corporation
2006–2011
Succeeded by