Banking commissioner appointment awaits N.C. vote

Ray Grace, who has been North Carolina's acting banking commissioner for more than a year, is waiting to learn whether the General Assembly will allow him to serve for what remains of his predecessor’s term.

Last week, Sen. Harry Brown, a Republican from Jacksonville and a member of the Senate’s Finance Committee, introduced a resolution to make Grace the official replacement for Joseph Smith. In February 2012, Smith resigned as commissioner so that he could oversee the roughly $25 billion national mortgage settlement, designed to provide relief to homeowners hurt when the housing bubble popped. The settlement involves five of the county’s biggest mortgage servicers, including Bank of America, JPMorgan Chase and Wells Fargo.

Nathan Batts, senior vice president of the North Carolina Bankers Association, said Monday that Grace has “very strong support” within the General Assembly.

“From all indications, speaking with those in leadership, Ray is held in great regard,” Batts said, adding that his association supports Grace for the commissioner position.

He also has the backing of Gov. Pat McCrory, a Republican who took office this year and who last month unveiled his support for Grace. After Smith announced his resignation Feb. 14, then-Gov. Bev Perdue, a Democrat, nominated Grace, who was chief deputy commissioner of banks before Smith quit, to serve as his replacement. But Ha Nguyen, spokeswoman for the commissioner's office, said Monday that legislation to confirm Grace's appointment was never introduced into the General Assembly last year, resulting in Grace serving in an interim role for nearly 14 months.

Smith’s term was set to expire at the end of March 2015.

A former Marine, Grace, 64, has worked for the commission since 1974. The commission is responsible for chartering and regulating the state’s banks, thrifts and nondepository trust companies.

Grace has held various positions for the commission, including commercial bank examiner, special supervisory examiner and director of bank applications. In a December 2011 speech given to the General Assembly’s Joint Legislative Economic Development & Global Engagement Oversight Committee, Smith referred to an “inflexible regime of federal bank regulation” brought about by the recession, according to a transcript.

“Banks do want, and need, to lend to small businesses and their other traditional customers,” Grace said. “The deep and persistent recession in which we find ourselves has made that lending problematic.”

Last year, after Smith left, Grace suddenly found himself having to work with a committee of General Assembly members studying ways to modernize North Carolina’s banking laws. The modernization efforts began years ago, while Smith was still commissioner, but Batts said Grace’s interactions with the committee in 2012 helped him to establish credibility with the General Assembly, which in June passed a bill to modernize the laws.

Robert Singer, corporate counsel for the bankers association, said Monday that he expects the General Assembly to confirm Grace as commissioner.

“I would be astounded if he wasn’t,” Singer said. “I hear from folks that he has overwhelming support in both the Senate and the House.”

Nguyen said Grace was out of town and unavailable for an interview Monday.