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Another seat just opened up on the Fed.

The Federal Reserve announced on Friday that Daniel Tarullo will be resigning “on or around April 5″ after more than eight years on the board of governors, creating a third vacancy at the US central bank for President Donald Trump to fill.

Mr Tarullo, who was appointed by President Barack Obama to a term ending in 2022, served as chairman of the board’s committee on supervision and regulation, as well as the Financial Stability Board’s standing committee on supervisory and regulatory cooperation during his tenure.

He said in his resignation letter:

It has been a great privilege to work with former Chairman (Ben) Bemanke and Chair (Janet) Yellen during such a challenging period for the nation’s economy and financial system.

The S&P 500 financials index, which has risen more than a fifth since Mr Trump’s election, rose as much as 0.6 per cent on Friday after the announcement that Mr Tarullo – seen as one of the Fed’s leading voices on bank regulation and supervision – would depart.

Mr Trump vowed on the campaign trail to streamline financial regulations, and within his first weeks in office has already ordered executive agencies to review the Dodd-Frank law passed in the wake of the financial crisis. Mr Tarullo’s resignation may give Mr Trump an opportunity to find a successor who shares his philosophy of reducing regulatory burdens.

In a February 6 note, Evercore ISI analysts Krishna Guha and Terry Haines speculated that filling Fed vacancies may not be at the top of Mr Trump’s to-do list – at least, not right away:

“We do not believe that the first batch of Fed nominations are imminent, with the administration and the Senate focused on executive branch appointments and (Neil) Gorsuch for the Supreme Court; early speculation on the initial two appointments focuses on former Bush administration Treasury official Nason or former SEC Commissioner Atkins for vice-chair for supervision and regulation, and Blankenship, vice-chair of Bank of the West, or Jones, CEO of Old National, for the community banker seat.”

Copyright The Financial Times Limited 2017. All rights reserved.
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