T. Timothy Ryan Jr., a Washington lawyer and former key Labor Department official, will be nominated as the nation's top savings and loan regulator, according to Bush Administration sources.
Ryan would become permanent director of the Office of Thrift Supervision, which oversees the S&L; industry beleaguered by the financial collapse of hundreds of insolvent institutions.
"The agency needs strong leadership," said an Administration source. Although Ryan has no direct experience with S&L; regulation, he worked as solicitor of the Labor Department in the Reagan Administration from 1981 through 1983, handling litigation and important issues of regulatory policy and enforcement.
Ryan "is a seasoned government veteran, tough and aggressive," an Administration source said. "We looked at a lot of different people for this job, and we feel he will provide important leadership and management skills." The Office of Thrift Supervision is "an agency that needs a change in direction after a rough period," according to the source.
Ryan would be the permanent replacement for the controversial M. Danny Wall, who has resigned as the top thrift regulator. Wall came under considerable criticism from Congress for his management of the Federal Home Loan Bank Board, the old regulatory agency for S&Ls.;
He was accused of providing overly optimistic estimates of the severity of the S&L; crisis. Wall was repeatedly attacked by members of Congress in connection with his delay in closing Lincoln Savings & Loan Assn., the Irvine institution that has become a politically damaging symbol of the entire S&L; debacle.
The shutdown of Lincoln may ultimately cost the government $2 billion. And the political contributions by Lincoln's former owner, Charles H. Keating Jr., have caused intense embarrassment for five senators. The Federal Home Loan Bank Board was abolished by last year's savings and loan rescue legislation, which provided $50 billion for the shutdown of crippled S&Ls; and payments to depositors, whose accounts are insured up to $100,000.
Ryan has solid connections with the White House, having directed a team of lawyers that helped the Bush campaign navigate the complexities of state rules and laws on delegates on the way to the presidential nomination in 1988. He worked as an advance man in President Richard M. Nixon's 1972 reelection campaign, served as general counsel in President Gerald R. Ford's losing bid for election in 1976, and joined (former Sen.) Howard H. Baker Jr.'s brief effort to win the Republican presidential nomination in 1980.
Ryan, 44, is currently a partner with the law firm of Reed, Smith, Shaw & McClay. The FBI will be undertaking a background check required of high-level nominees before his name is formally submitted to the Senate for confirmation.
After passage of the S&L; legislation last year, the bank board's powers were trimmed, it was renamed the Office of Thrift Supervision and placed in the Treasury Department. However, the office still has the authority to set financial standards for S&Ls; and implement the complex provisions of S&L; law. Its rulings can mean fiscal life or death for hundreds of financially troubled institutions.
The Office of Thrift Supervision is being run temporarily by Salvatore R. Martouche, assistant secretary of the Treasury for enforcement. Martouche has been responsible for the Secret Service, the Customs Service and government activities aimed at money-laundering from illegal activities.
Martouche will hold the post until Ryan is confirmed by the Senate, according to Administration sources.