Saule Omarova, Biden’s Nominee to Oversee Nationwide Banks, Withdraws

Mr. Biden final month nominated Ms. Omarova, a Cornell College regulation professor, to be Comptroller of the Forex, which supervises most of the greatest U.S. lenders together with

JPMorgan Chase

& Co. and

Wells Fargo

& Co.

Ms. Omarova’s earlier requires shrinking massive banks and making a a lot greater position for the Federal Reserve in shopper banking has drawn opposition from business advocates and Republicans. They have mentioned she envisions an excessively massive position for the federal government that they are saying would crimp enterprise, even at neighborhood lenders, a strong constituency that lobbied in opposition to her nomination.

A bunch of reasonable Democrats privately voiced their opposition to Ms. Omarova within the days after a contentious nomination listening to in November, in accordance with individuals accustomed to the deliberations. Their opposition alone doubtless scuttled her probabilities of affirmation by way of the evenly divided Senate.

Montana Sen. Jon Tester,

Arizona Sen. Kyrsten Sinema

and Virginia Sen. Mark Warner—all centrist Democrats—conveyed their opposition to Senate Banking Committee Chairman

Sherrod Brown

(D., Ohio) on a phone name about two weeks in the past, The Wall Avenue Journal reported final month.

The dialog got here after Messrs. Tester and Warner challenged Ms. Omarova on the Nov. 18 listening to over her previous writing and considering on banking oversight. Mr. Tester additionally pressed her on the listening to over remarks she made earlier this yr calling for smaller oil-and-gas corporations to go bankrupt to assist the U.S. in tackling local weather change.

Ms. Omarova responded to Mr. Tester on the listening to by saying she misspoke and that her remarks weren’t well-framed. “My intention was…precisely the other,” she mentioned. “We have to assist these corporations to get restructured.”

Ms. Omarova didn’t reply to an electronic mail on Tuesday looking for remark. In a short withdrawal letter launched by the White Home, Ms. Omarova mentioned, “it’s not tenable for me to proceed as a Presidential nominee.”

White Home officers have defended Ms. Omarova however didn’t touch upon Democratic opposition. Administration officers have mentioned that Ms. Omarova, who was born in Kazakhstan when it was a part of the Soviet Union, has been the goal of “crimson baiting” from Republicans.

“As a powerful advocate for shoppers and a staunch defender of the security and soundness of our monetary system, Saule would have introduced invaluable perception and perspective to our vital work on behalf of the American individuals,” Mr. Biden mentioned on Tuesday. “However sadly, from the very starting of her nomination, Saule was subjected to inappropriate private assaults that have been far past the pale.”

Ms. Omarova’s defenders additionally embrace liberal-leaning Democrats corresponding to Mr. Brown and Sen. Elizabeth Warren of Massachusetts. They’ve mentioned she is an completed banking skilled who will stand as much as the business. The senators say Washington regulators have been too deferential to massive banks in recent times and that Ms. Omarova would work to make the monetary system extra inclusive for shoppers.

The Workplace of the Comptroller of the Forex is an unbiased bureau of the Treasury Division. It oversees about 1,200 banks with complete belongings of $14 trillion, about two-thirds of the entire within the U.S. banking system.

The White Home has struggled to discover a comptroller nominee who might win help from its Senate allies. Earlier than nominating Ms. Omarova, the White Home thought of at the least three different people for the position however by no means nominated them.

At current, the company is run on an interim foundation by Michael Hsu, a former Fed staffer. It has been with no Senate-confirmed head since Could 2020.

Write to Andrew Ackerman at andrew.ackerman@wsj.com