Quarles has served as the Fed’s first vice chair of supervision, which gave him wide-ranging authority over the banking system. In that role, he oversaw a broad loosening of some of the financial regulations that were put in place after the 2008-2009 global financial crisis and recession.

Quarles’ deregulatory approach prompted criticism from some on the Fed and from many progressives. It has also sparked resistance from progressives to the potential re-nomination of Jerome Powell as Fed chair.

With Powell’s term as chair ending in February, an announcement is expected sometime this month on whether Biden will offer him a second four-year term. The president is considered likely to re-nominate Powell, although he could decide instead to elevate Lael Brainard, who is now the lone Democrat on the Fed’s seven-member board, to the position of chair.

Besides Quarles’ soon-to-be vacated position on the board, a second slot is vacant and a third will open up in January, when Vice Chair Richard Clarida’s term on the board will expire. Counting the seat held by the Fed chair, that gives Biden a total of four potential slots to fill.

The president may decide to re-nominate Powell while also promoting Brainard to replace Quarles as vice chair for supervision. That move could potentially mollify at least some of Powell’s critics. Brainard cast some dissenting votes against Quarles’ deregulatory efforts.

Members of the Board of Governors have permanent votes at each Fed meeting on interest-rate policy, a powerful tool that affects hiring and the economy. The 12 regional Fed bank presidents also attend policymaking meetings. But only five of them are able to vote on the Fed’s decisions: The New York Fed president holds a permanent vote, and the regional bank presidents hold four votes that rotate among them each year.

The Fed governors also vote on financial regulations, and they could take steps to regulate some cryptocurrencies, known as stablecoins. Some of the officials, including Brainard and Powell, have discussed incorporating climate change considerations into the Fed’s bank oversight, a possibility that has met with opposition from congressional Republicans.

Potential nominees for the three vacancies on the Fed’s board include Lisa Cook, an economist at Michigan State University who would be the first black woman to serve as a Fed governor, and Sarah Bloom Raskin, who previously served as a Fed governor and as a financial regulator in Maryland.

Another potential nominee is William Spriggs, chief economist at the AFL-CIO and an economics professor at Howard University.

At a Senate hearing in September, Sen. Sherrod Brown, an Ohio Democrat who chairs the Senate Banking Committee, which oversees Fed nominations, said, “It’s time we had a Black woman on the Board of Governors.”

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