Investment banker-turned-school teacher Jack Ryan, once touted as an up-and-coming star within the GOP, bowed out of the Illinois Senate race this afternoon — four days after sex-club allegations set off a wave of negative reactions too fierce for his campaign to ride out.

With Ryan’s exit from the race, it will be up to the state GOP central committee to name who will face state Sen. Barack Obama (D) in the open-seat race this November.

In a statement, Ryan said he was withdrawing from the race to avoid “a brutal, scorched earth campaign.”

“It’s clear to me that a vigorous debate on the issues most likely could not take place if I remain in the race,” Ryan said. “What would take place, rather, is a brutal, scorched-earth campaign — the kind of campaign that has turned off so many voters, the kind of politics I refuse to play.”

Ryan also blasted the media frenzy that unfolded after the release of documents that included allegations that Ryan took his ex-wife, actress Jeri Ryan, to sex clubs during their marriage where he pressured her to perform sex acts while others watched.

“The media has gotten out of control,” Ryan said. “The fact that the Chicago Tribune sues for access to sealed custody documents and then takes unto itself the right to publish details of a custody dispute — over the objections of two parents who agree that the re-airing of their arguments will hurt their ability to co-parent their child and will hurt their child — is truly outrageous.”

Jeri Ryan made the charges in 2000 during the couple’s child custody battle. At the time, Ryan dismissed his ex-wife’s accusations as “false” and “smut.” Ultimately the judge ruled to give the couple joint custody.

Privately, aides close to Ryan also took aim at the unwillingness of state party leaders to stand behind Ryan through the ordeal.

“Barack Obama’s best friend, the state Republican Party, was a willing accomplice in the public execution of a very good man,” said one source close to the campaign.

Ryan, who left a lucrative job at Goldman Sachs to become a teacher at a mostly black Catholic high school in inner-city Chicago, won a crowded March primary with 36 percent of the vote. He had toyed with the idea of running for public office for several years prior to jumping last year into the race to succeed retiring Sen. Peter Fitzgerald (R).

“He’s just devastated,” said the source. “Because this is a guy who’s led a relatively good life, in terms of helping people … and to have your reputation crapped on and sensationalized and flat out made up, over an accusation that was denied about sex with one’s wife. It doesn’t get any worse than that.”

The state GOP’s Central Committee is now charged with finding a ballot replacement for Ryan in the coming weeks, before ballots are certified in late August.

Hastert met with the 10 Members of the state’s GOP Congressional delegation on Thursday, at which time the group came to the conclusion that Ryan had to go. Sources said that during the meeting Reps. John Shimkus and Don Manzullo were most adamant that Ryan must be replaced.

“Jack Ryan made the right decision,” Hastert said in a statement. “I know it must have been a difficult one. … I am confident the party will select a candidate who will unite Republicans throughout this state and quickly launch a winning campaign based on substantive issues that are of importance to Illinois voters.”

While Hastert never publicly spoke out about the allegations and the future of Ryan’s candidacy this week, the support of Senate leaders, including National Republican Senatorial Committee Chairman George Allen (Va.), never wavered.

“We understand and respect the difficult decision Jack Ryan made today,” Allen said in a statement Friday. “We wish him and his family well as they move forward with their lives.”

Fitzgerald and GOP Conference Chairman Rick Santorum (Pa.) were two of Ryan’s staunchest supporters, even as the calls for him to exit the race grew to a fever pitch before week’s end.

While several names have dominated much of the speculation around who might replace Ryan on the ballot, most of those people are believed to be uninterested in the job.

They include former Govs. Jim Edgar and Jim Thompson, state party Chairwoman Judy Baar Topinka, who is also the state treasurer, and paper company executive Andy McKenna.

But sources said among those more likely to be in the running for the ballot spot are:

• State Sen. Steve Rauschenberger, who placed third in the March GOP primary and has a strong grassroots following among many party activists. However, he has no personal wealth and observers doubt he would have the ability to raise the money necessary to make a competitive run at this late date.

• Dairy magnate Jim Oberweis, who came in second in the primary and does have significant personal wealth to spend. But he’s lost two Senate primaries, not a good indication that he’ll be able to get the backing of party faithful.

• Former state Board of Education Chairman Ron Gidwitz, a wealthy former CEO of Helene Curtis International, who is being touted by many party insiders. There is a wide belief that he has the advantage because he raises money for the state party.

Some Republicans are also floating the possibility of tapping Patrick Fitzgerald, the U.S. attorney for northern Illinois. Supporters say his squeaky clean image and willingness to go after corruption might be just what the party needs in the wake of the Ryan allegations.