SEC’s Walter Calls Designated Successor White a Quick Study

U.S. Securities and Exchange Commission Chairman Elisse B. Walter said her designated successor Mary Jo White will be a quick study as the nation’s top financial-markets regulator.

Walter was appointed chairman after Mary Schapiro left the post in December. Walter’s tenure as chairman may be brief as President Barack Obama last week said he will nominate White, a former prosecutor and corporate lawyer with no experience as a regulator, to succeed her.

“She’s a very quick study and she’s a very smart woman and I look forward to working with her as she comes,” Walter told reporters today in Washington. “I think she’s terrific.”

Walter, 62, said she would remain chairman until White, a former U.S. Attorney in Manhattan, is confirmed by the Senate. White is a partner at law firm Debevoise & Plimpton LLP in New York and served on the board of the Nasdaq Stock Market Inc.

Walter, who became a commissioner in July 2008, said she hasn’t decided how long she’ll remain on the commission once White joins.

“I have decided not to think about it for now because that may be a very short time and that may be a very long time,” she said.

Walter said the commissioners are “working well together” on an effort to overhaul rules governing the $2.7 trillion money market mutual-fund industry. The SEC has been working to change the rules since the September 2008 collapse of the $62.5 billion Reserve Primary Fund.

Schapiro Plan

A plan by Schapiro to force money funds to choose between a floating share value or a combination of capital buffers and withdrawal restrictions was dropped in August after a majority of the five-member commission didn’t support moving forward.

Commissioners renewed consideration of a proposal after the Financial Stability Oversight Council issued recommended rules in November. The FSOC, a panel of regulatory chiefs lead by the Treasury secretary, was created by the Dodd-Frank Act to address systemic risks in the wake of the 2008 financial crisis.

“The whole dynamic around that project has changed,” Walter said.

SEC Commissioner Daniel M. Gallagher, a Republican appointee, said commissioners are studying options for new money-fund regulation prepared by the SEC staff. He declined to describe the proposals.

“I think there is a path forward developing,” Gallagher said.

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