Key Democrat calls for FDIC chief's ouster over 'toxic culture' that includes sexual harassment

The top Democrat on the Senate's Committee on Banking, Housing, and Urban Affairs on Monday called for new leadership at the Federal Deposit Insurance Corp. and asked President Biden to select a replacement for embattled FDIC Chair Martin Gruenberg.

Senate Banking Committee Chair Sherrod Brown of Ohio issued a statement in which he said the FDIC needs someone at the top "who must fix the agency’s toxic culture and put the women and men who work there – and their mission – first."

"That’s why I’m calling on the President to immediately nominate a new Chair who can lead the FDIC at this challenging time and for the Senate to act on that nomination without delay," Brown wrote.

FDIC CHAIR GRUENBERG REFUSES TO RESIGN

Gruenberg came under fire after a Wall Street Journal expose in November revealed alarming claims of an abusive workplace culture at the FDIC, and an external review that followed found sweeping reports of employee mistreatment and sexual harassment.

The FDIC chief has spent nearly two decades in leadership roles at the agency and was also the subject of some employee complaints about his temper. He testified for several hours before the committee last week and faced steady criticism from Republicans and Democrats, who expressed anger, dismay and disbelief at the extent of the issues at the FDIC.

FDIC CANCELS PLANNED BOARD MEETING AFTER WSJ REPORTS OF TOXIC WORKPLACE

"After chairing last week’s hearing, reviewing the independent report, and receiving further outreach from FDIC employees to the Banking and Housing Committee, I am left with one conclusion: there must be fundamental changes at the FDIC," Brown said in his statement.

The request is a major blow to Gruenberg's efforts to stay on atop the bank regulator, as Brown is the most senior Democrat thus far to call for his replacement.

Notably, Brown did not call for Gruenberg to immediately resign, as many Republicans in Congress have. Should Gruenberg leave the agency without a confirmed replacement, leadership of the FDIC would fall to Travis Hill, the agency's vice chair and a Republican. The agency would then be deadlocked 2-2.

The FDIC is working with the Federal Reserve and the Office of the Comptroller of the Currency on several rule-writing projects that would tighten requirements on larger banks. That agenda could be imperiled should Gruenberg leave the agency without a replacement.

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The FDIC declined to comment when reached by FOX Business, and the White House did not immediately respond.

Reuters contributed to this report.