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Trump pick Nellie Liang withdraws nomination for Fed governor

Brian Cheung
Reporter

Note: This story was edited on 1/8 at 9:22 a.m. to add comments from Liang.

Nellie Liang, the former Federal Reserve official selected by President Donald Trump for a seat on the Fed board, has withdrawn her nomination.

“We regret to announce that today Nellie Liang notified us that she has withdrawn from nomination to the Federal Reserve Board of Governors.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

In a statement to Yahoo Finance on Tuesday, Liang said she “decided to withdraw my name from consideration to be a member of the Board of Governors of the Federal Reserve because the likelihood of a prolonged process could have left me in professional limbo for too long.” Liang currently works at the Washington, D.C.-based think tank Brookings Institution, where she says she looks forward to “contributing as an outside researcher to the vital economic policy issues they face.”

Nellie Liang speaks during a financial stability analysis conference in Washington, D.C., U.S., on Friday, May 31, 2013. Photographer: Andrew Harrer/Bloomberg via Getty Images

Liang, whose 11-year career at the Fed was highlighted by her work establishing many post-crisis regulatory reforms on the banking industry, was nominated by the administration in September. Her nomination by an administration broadly seeking to reduce red tape led to some confusion within the Republican-controlled Senate, which fueled early skepticism over Liang’s ability to survive the confirmation process.

Since joining Brookings in February 2017, Liang has penned articles defending the need for strong stress tests and criticizing the U.S. Treasury’s recommendations for loosening capital requirements on the largest banks.

Liang never faced the Senate Banking Committee for a hearing. She did not respond to requests for comment.

Goodfriend

There is still one Fed nomination up in the air: Marvin Goodfriend. The Carnegie Mellon University professor cleared the committee in February 2018 but a bumpy confirmation hearing raised concerns that he also would struggle to win enough support in a full Senate confirmation vote. Because a new Congress has taken office effective January 2019, his nomination technically lapsed and would require renomination from the White House.

The White House did not provide an update on Goodfriend’s nomination.

The Federal Reserve Board of Governors currently has five of its seven seats filled. Fed Chair Jay Powell was originally appointed as a Fed governor under the Obama administration in 2012 but was sworn in as Chair in 2018 after being nominated by Trump. Richard Clarida, Randal Quarles, and Michelle Bowman are all first-time Fed Governors appointed by Trump. The last remaining Obama-era governor not to be renominated by Trump is Lael Brainard, whose term ends in 2026.

Brian Cheung is a reporter covering the banking industry and the intersection of finance and policy for Yahoo Finance. You can follow him on Twitter @bcheungz.

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