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US hearings this week could take Basel II temperature

WASHINGTON, June 6 (Global Risk Regulator) – US Senate hearings scheduled this week on President George W Bush’s nominations for important posts in the nation’s banking supervision system could test the political temperature following the latest US proposals for implementing the controversial Basel II bank safety rules.

On Thursday, June 8, the Senate’s banking committee will hold hearings on Bush’s nomination of Donald Kohn as vice chairman of the Federal Reserve Board, which oversees the US central banking system, and of Sheila Bair as chairman of the Federal Deposit Insurance Board (FDIC), which insures customer deposits at US banks.

Kohn, a monetary policy specialist who is a member of the Fed’s Board of Governors and a veteran of the Federal Reserve system, has been nominated to fill the vacancy left by Roger Ferguson’s resignation as Fed vice chairman.

Bair is currently dean’s professor of financial regulation policy at Isenberg School of Management at the University of Massachusetts-Amherst. She was previously Assistant Treasury Secretary for financial institutions. Bair would replace Donald Powell, who left the FDIC in November to co-ordinate efforts to rebuild hurricane-hit US Gulf Coast areas.