State Rep. Jay Fant is dropping out of the attorney general's race to try to become the state's financial regulator, leading the office that shut down his family's bank six years ago.

In a Tuesday evening announcement, the Jacksonville Republican said that he wanted to become commissioner of the Office of Financial Regulation, which oversees banks, check-cashing stores and payday loan shops.

That was the same institution that blamed Fant for the failure of the First Guaranty Bank and Trust, founded by Fant's grandfather in 1947.

At one point, it was Jacksonville's oldest bank. But under Fant's leadership, the bank engaged in risky loans, some of which state regulators said violated banking regulations. When the Great Recession hit, the bank was crushed.

"The bank's financial deterioration is a direct result of poor loan underwriting and a lack of sound lending department controls," OFR examiners wrote in 2009. "The board and executive management are responsible for the resulting deterioration as they failed to institute sound policies and procedures and appropriately oversee credit practices."

That report also said Fant accepted the blame.

"Chairman and Chief Executive Officer Julian E. Fant III acknowledged the board's responsibility for the condition of the bank. … Chairman Fant acknowledged that in hindsight he did not appreciate the gravity of the concerns raised in prior examinations," examiners wrote.

But on Tuesday, Fant blamed "wayward government policy" for the bank's failure:

"I was running a small community bank during the Great Recession and Florida real estate crisis," he said in a statement. "Our company, like all banks and financial firms, suffered tremendously. The federal government intervened by passing a massive bank bailout that helped the largest banks and left the small community banks out in the cold. 64 banks in Florida alone, including ours, went out of business. Wall Street won. Main Street lost."

Fant would be replacing outgoing Commissioner Drew Breakspear, who was pressured to resign by CFO Jimmy Patronis, who complained that Breakspear was not being responsive to people in the industry.

On Tuesday, Fant told Politico, which first reported his announcement, that he wants to instill a "servants culture" in the office.

He's going up against 22 applicants, including Linda Charity, who twice led the office in an interim role.

In April, Charity defended Fant's role in the banking failure, telling the Times/Herald that "people just walked away from their loans."

The Florida Cabinet, made up of Patronis, Gov. Rick Scott, Agriculture Commissioner Adam Putnam and Attorney General Pam Bondi, could pick a replacement as early as next week.

Fant's chances are likely better than they were in the attorney general's race, where he was falling behind in fundraising. And one of his opponents, Ashley Moody, was already endorsed by Bondi.

Times/Herald staff writer William March contributed to this report.