Bush Nominee for Top S&L; Regulator Blasted by Panel

T. Timothy Ryan Jr., President Bush’s hastily named nominee to regulate savings and loan associations, ran into a barrage of criticism Wednesday from senators who said he is unqualified to help direct the massive rescue of the thrift industry.

Ryan, a pension lawyer and former Labor Department official, told skeptical members of the Senate Banking Committee that he was drafted for the S&L; job four weeks ago by Treasury officials.

Because Ryan, 44, has no experience with S&Ls; or banks, “there is a very serious reservation on the part of many” senators that he can handle the job, said Sen. Donald W. Riegle Jr. (D-Mich.), the committee chairman.

“Colleagues have said to me publicly and privately this is a major area of concern to them,” Riegle told Ryan at the end of 4 1/2 hours of questioning.

Sen. Alan J. Dixon (D-Ill.) called Ryan “a perfectly decent fellow (who) doesn’t know anything about the thrift industry or the financial industry.” Ryan has been active in Republican politics and knew some Treasury officials from the 1988 presidential campaign.

Sen. Connie M. Mack III (R-Fla.), who spent 16 years in the banking business, said he is fearful Ryan lacks “the background or scope of knowledge to understand what is happening in the trenches.”

The Administration has been rushing to find a new director of the Office of Thrift Supervision because a recent court ruling threw into potential jeopardy the government takeover of 150 insolvent institutions. A U.S. District Court judge blocked the impending takeover of an Illinois S&L;, saying the OTS couldn’t act because M. Danny Wall, the former OTS director, had not been constitutionally confirmed by the Senate. The government has taken the case to an appeals court, which will hear arguments next month.

Fearful of the possible threat to its regulatory powers, the Administration sped the nomination of Ryan to the Senate last week. But the committee response Wednesday suggests he may face a difficult struggle to win confirmation.

“I did not seek the job,” Ryan said in response to questions. “Frankly, I was surprised when I received the call. (My) background was principally as a lawyer on the pension side.”

Sen. Riegle told Ryan, “It sounds to me like you were drafted.”

Charles H. Keating Jr., the controversial S&L; executive who has become a symbol of the thrift crisis, sat in the audience two rows behind the witness table during the first hour of Ryan’s meeting with the committee.

The failure of Keating’s S&L;, Lincoln Savings of Irvine, is expected to cost the government $2.5 billion to pay off depositors, making it the biggest single casualty of the thrift crisis. Although the government is suing Keating for fraud, the Arizona multimillionaire has gone on a public relations offensive, arguing that he was brought down by overzealous government regulators.

Keating offered to testify as a witness against Ryan, but was turned down by the committee. He came to Washington anyway, handed out a printed statement denouncing the government and Ryan’s nomination, and was pounced on by a swarm of eager reporters and photographers before the hearing began.

“I’m not embarrassed by anything I’ve done,” Keating said.

According to Keating, Ryan’s predecessors as thrift regulators were unqualified, and Ryan’s confirmation “would just nail the coffin lid on taxpayer losses.”

If confirmed by the Senate, Ryan would supervise the broad regulatory powers of the OTS, which enforces capital standards and other key rules for thrift institutions. The OTS also serves as a watchdog looking for failing S&Ls; that could be candidates for takeover by the federal government.

Sen. Jake Garn (R-Utah), the committee’s ranking Republican, called for quick action on Ryan’s nomination, saying confirmation will help accelerate the process of cleaning up the troubled thrift industry by closing down or selling failed institutions.

“The tourniquet has not yet been put in place, the (S&L;) industry is still hemorrhaging and the taxpayers will pay the cost,” Garn said.

The nominee, admitting his lack of knowledge and experience in financial issues, pledged to bring determination, energy, and decisiveness to the job.

“I’m a quick learner and dedicated,” Ryan said. “My reputation is as a doer.

“I have a proven record in the enforcement area,” added Ryan, who served as solicitor of the Labor Department from 1981 to 1983. He directed the government cleanup of the questionable investments of a Teamsters Union pension fund. Since 1983, Ryan has been a private attorney with Reed, Smith, Shaw & McClay specializing in pension and employee benefit law.

In 1988, Ryan was special counsel to the Bush for President Committee. In 1980, he served as legal counsel for the Ronald Reagan presidential transition office. In 1976, he worked on Gerald R. Ford’s presidential campaign. He also was an attorney with the National Labor Relations Board.

He vowed to “regain and keep the public confidence in the thrift regulatory system.”