The White House said Monday that the chairman of the Federal Deposit Insurance Corporation will step down, a departure that follows the release earlier this month of a damning report about the agency’s toxic workplace culture.

The White House said Martin Gruenberg will step down once a successor is appointed and that President Joe Biden will name a replacement “soon.” The announcement came after the top Democrat on the Senate Banking Committee earlier Monday called for Gruenberg’s removal.

Rep. Patrick McHenry (R-N.C.), chair of the House Financial Services Committee, called on embattled FDIC chairman Martin Gruenberg to resign at a contentious hearing Wednesday morning.

Why it matters: Gruenberg's job is on the line in the wake of a damning investigation that found widespread sexual harassment and a toxic workplace culture at the banking agency he leads.

Embattled Federal Deposit Insurance Corporation (FDIC) Chair Martin Gruenberg took the hot seat in front of the House Financial Services Committee on Wednesday morning following a scathing report on widespread sexual harassment and discrimination at his agency.

“Showing up today is not an act of courage. It’s an act of hubris,” Rep. Patrick McHenry (R-N.C.), chair of the Financial Services panel, told Gruenberg. McHenry and numerous other Republicans have called for Gruenberg to resign.

Republican Missouri Rep. Ann Wagner criticized Federal Deposit Insurance Corporation (FDIC) Chairman Martin J. Gruenberg during a Wednesday hearing for his conduct while leading the agency.

The FDIC’s workplace culture is stricken by inappropriate behaviors like “sexual harassment, discrimination, and other interpersonal misconduct,” according to a recent report by law firm Cleary Gottlieb Steen & Hamilton. Gruenberg has a reputation for possessing a temper, based on employees’ examples in the report, and Wagner told the chairman he should be fired.

Fulton Financial (FULT) shares surged Monday after the bank said it acquired the debt and deposits of Philadelphia-based Republic First Bank following the first bank failure of 2024. Republic First Bank was seized by regulators Friday after a deal for $35 million in funding reportedly fell apart earlier this year.12

After a deal was reached with Fulton, the Federal Deposit Insurance Corporation (FDIC) said the Fulton deal was the least costly path for the Deposit Insurance Fund (DIF). It estimated the failure will cost the DIF about $667 million.

Philadelphia-based Republic First Bank was closed by state regulators Friday night and its assets were given to the Federal Deposit Insurance Corp., FDIC announced in a news release.

Republic Bank's assets are now being taken over by Lancaster, Pennsylvania-based Fulton Bank effective immediately. Fulton is also assuming all deposits.

Republic First Bank is a regional lender operating in Pennsylvania, New Jersey and New York. The company did business as Republic Bank and had roughly $6 billion in assets and $4 billion in deposits as of Jan. 31.