Pete Schroeder and Michelle Price

WASHINGTON (Reuters] – Randal Qarles was U.S. Federal Reserve Vice Chair for Supervision, the most influential bank regulator in the country, and announced Monday that he would resign at December’s end. It will be the end to a controversial four-year-old term, during which many critics said he was too friendly toward Wall Street.

Quarles’ exit will probably see the Fed take a more tough stance on banks after the 2008-2009 financial crisis. The Fed is expected to tackle thorny topics such as fair lending, climate change, bank capital requirements, fair lending, and other issues. His plans for resignation were announced Monday.

Quarles’ departure opens up another spot for President Joe Biden, to help fill the gap in what could have been a wide remake of Fed personnel.

Quarles, who was appointed in 2017 by the former Republican President Donald Trump as the vice chair of supervision after the financial crisis, but which President Barack Obama never filled, was first elected to this position.

Quarles’ term as chief of the Financial Stability Board (an international regulatory organization) expires in December. Quarles was officially removed as head of the Fed’s internal regulatory panel after his term in office as vice-chair for supervision ended in October.

A Wall Street attorney and investor in private equity, he was immediately seen as an industry friend who would help Trump fulfill his pledge to lower red tape.

Quarles was supported by Jerome Powell (Fed chair) and continued to loosen a number of rules that had been in place after the crisis. Democrats were furious at the change, saying it saved Wall Street billions while increasing the risk of systemic disasters.

He stated that it was his responsibility to make sure they work as designed and that, due to the complexity and breadth of this new regulation, we’ll be able improve them,” he said to an audience of 2018

Among the most contentious changes Quarles spearheaded were revisions to the “Volcker Rule” curbing speculative bank investments; scrapping a requirement for big banks to hold capital against certain swap trades; stripping the Fed of its power to flunk banks on their annual “stress tests” based on subjective concerns; and easing capital, leverage and liquidity rules for all but the biggest lenders.

Quarles, 64 years old, often stated that he had tailored rules for banks to address specific risks. Some regulatory experts supported this assertion. Quarles has stated that the industry’s outstanding performance in the economic crisis caused by the pandemic did not prove that he had weakened the system.

Quarles, as chair of the multilateral Financial Stability Board (2018-2018), had a global impact. The body increased scrutiny over the expanding non-bank financial sector, particularly money market funds.

Wall Street executives often expressed disappointment with Quarles. Privately, they complained that he didn’t go enough to loosen the post-crisis rules. This complaint was shared by some Republican congressmen.

Lael brainard, who was a Fed governor at the time, opposed many of Brainard’s revisions. He said they had gone too far and that there was increased systemic risk. It is rare for institutions known for their consensus to be so openly critical. Brainard has been considered the leading contender to succeed Quarles as vice chair.

Quarles’ successor will possess a full-blown agenda that addresses the whole gamut of issues, including capital rules, fair lending, digital assets, fintech, climate change, and financial regulation.

Quarles generally followed Powell when it came to monetary policies. Quarles backed Powell’s prompt introduction of extraordinary monetary stimuli to combat the COVID-19 pandemic. He also supported Powell’s call for a more inflation-friendly monetary policy.

Quarles seemed more keen to begin a conversation on the reduction of Fed bond purchases in a May speech than his peers, citing inflation fears. He said he was in agreement with core Fed officials who believed that most of the current pressures for higher prices will pass.

He said, “I’m not concerned about a return in the 1970s.”

Quarles is a Mormon from Utah, an amateur pilot, and multimillionaire. Quarles did not grow up in Washington, preferring to stay home with his family, rather than attend the capital’s cocktail party circuit.

Multiple executives and colleagues described Quarles as intelligent, principled, and extremely erudite. Quarles often peppered speeches with cultural and classical references, even Star Trek analogies.

Hope Eccles was Quarles’ great-niece from Marriner S. Eccles (Fed chair 1934-1948), a family link that Quarles said gave him deep respect for the central bank.