Coming Full Circle: Martin J. Gruenberg’s Journey in Public Service
On Wednesday, February 28th, 2024, The O’Malley School of Business at Manhattan College hosted Federal Deposit Insurance Corporation (FDIC) Chairman Martin J. Gruenberg as the featured speaker for the Ambassador Charles A. Gargano Lecture on “Making a Difference in Government”. Mr. Gruenberg was interviewed by the Dean of the Manhattan College O'Malley School of Business, Don Gibson, and UNHP Director of Programs ( and proud Jasper) Jumelia Abrahamson with an audience of about 150 students, faculty, and community guests. Manhattan College posted its overview of the event here.
Gruenberg spoke about his personal journey - from his early years in the Bronx in an apartment in Kingsbridge to handling the Signature Bank multifamily housing portfolio which included the building he grew up in. His parents were Holocaust survivors from Poland who emigrated and settled in the Bronx “..when you come from that kind of a background and you understand how hard life can be – cruel and brutal..”. Despite the flaws this country has, it is built upon the idea of self-governance to protect one’s fundamental liberties, and Gruenberg did not ever take that for granted. A career in public service was a natural path for him to follow.
When asked what influence the Bronx had in his life Chair Gruenberg answered " It was everything. I'm a New Yorker. I root for the Yankees and Knicks. I root for the Giants, and that's not easy. I've had a lot of opportunities and privileges in my life. I came from a working-class family in a working-class Bronx neighborhood.
Gruenberg began his career in the late 70s working as the Bronx Congressional aide for Jonathan Bingham. He supported housing and development projects in the Bronx - an area he was quite familiar with, and where he first interacted with the Northwest Bronx Community and Clergy Coalition (NWBCCC). He worked with organizers such as UNHP Director Jim Buckley, Bill Frey, John Reilly, Lois Harr, Jim Mitchell, and Anne Devenney - "Her motto was Don't Move, Improve. And that's my formative professional experience. I learned from that experience...You could form effective partnerships with local financial institutions, which is where the private money is, the city officials, which is where the public money is, and the community organizations which is where the people are who actually know the neighborhoods. And if those three can get together, you can actually get things done."There were thousands of abandoned housing units in the Bronx in the 1980-90s and through partnerships amongst community organizations, banks, city and state officials, and with the incentive of the Community Reinvestment Act (CRA), over a generation the Bronx was rebuilt “...it really (is) one of the great urban success stories in the country.”
On CRA
The Community Reinvestment Act has wide public support and it is unique in that way. Since its enactment, it has been the source of literally billions of dollars in credit and investment in low and moderate-income communities, in communities of color across the US - urban, suburban, rural, Native American communities,- an enormous benefit. I mentioned it was enacted in '77, and the ( Bronx community) meeting I mentioned in 1980, the bankers were at that meeting for only one reason: CRA. They knew if they did not do something, they could have a problem with the regulator. They did not know that most of these neighborhoods existed until CRA.
Gruenberg was questioned about the FDIC and how he worked to resolve the Signature Bank failure. He took us back to 1933 when the FDIC was created amid the Depression by President Franklin Roosevelt to build confidence in banks and ensure the safety of people’s deposits. When Signature Bank failed in March 2023, the FDIC had to take ownership of its assets and protect depositors. "And it was just a year ago on Friday, March 10; this sticks in your memory when a $100 billion bank fails and you're responsible." The failed bank left behind 80,000 units of multifamily rental housing in NYC, 20,000 of which were in the Bronx, he remarked: “..for a while I could say, I owned the building I grew up in.” As the Chairman of the FDIC, Gruenberg went back to his connections in the Bronx "I had some appreciation for what an incredible mess we were in. And that's a pretty good definition of a nightmare, 80,000 units in NYC. Nothing good could come out of that. You're not going to earn a lot of popularity. But I must say I really benefited because I knew some of the people in this room to call who were still here...working in these Bronx neighborhoods, rebuilding these neighborhoods." UNHP was one of these groups and has played an important role in providing the FDIC with data from its Building Indicator Project on the Signature multifamily portfolio in NYC. Gruenberg acknowledged the commitment of the community organizations and commended their lifetime of work which for him epitomizes public service. He knew that he had to work on forming a partnership between the local community organizations, tenant groups, lenders, and city and state officials if they wanted to have any success in managing this housing portfolio. Under the leadership of Mr. Gruenberg, the FDIC recognized their “ statutory obligation, among other factors, to maximize the preservation of the availability and affordability of residential real property for low- and moderate-income individuals. To support this obligation, the FDIC placed the rent-stabilized or rent-controlled loans in one or more joint ventures (JV) with the FDIC retaining a majority equity interest in the JV. In addition, the JV operating agreement will provide certain requirements that facilitate the financial and physical preservation of these loans and underlying collateral. The FDIC announced several of the Joint Venture transactions in December.
Speaking to the many Manhattan College business students in the audience, Mr. Gruenberg encouraged them to understand themselves and their values and to follow their passions. He recommended public service as a way to express those values and to benefit from the high level of responsibility that one can be awarded. It is both a privilege and a great responsibility to serve the public ...the functioning of a democracy is reliant on the public institutions that sustain it and on the Integrity of public service. It's as simple as that and sustaining ( a high level of public service) is critical to carrying forward our democracy.
It was truly an inspiring evening for all in attendance. UNHP was honored to cohost the lecture and is grateful to Manhattan College for the invite. UNHP is also honored to work with the FDIC and Chair Gruenberg. We hope that the thoughtful stewardship and bold leadership of the FDIC over the fate of the homes of over 80,000 families will improve the living conditions for low-income tenants, preserve the long-term affordability of the properties, and serve as a model for future distressed buildings.
Photo Credit Manhattan College photographer
Aliyah Sahqani, UNHP Intern and Fordham Graduate student authored this post.