New Roll for Call Fannie, Freddie Congressional Committees
January 10, 2013
Following the official opening of the 113th Congress last week, the two key congressional committees overseeing mortgage and housing issues are reorganizing their membership rolls but it remains to be seen whether lawmakers will be any more successful at advancing legislative GSE reform than during the previous two-year session.
As expected, Rep. Jeb Hensarling, R-TX, has assumed the gavel of the House Financial Services Committee, replacing the term-limited former chairman Spencer Bachus, R-AL, who will remain on the committee.
Rep. Gary Miller, R-CA, will serve as vice chairman of the committee, while Rep. Lynn Westmoreland, R-GA, will serve in the newly created position as the Committee Whip.
Chairman Hensarling also announced plans to combine two existing subcommittees – the Domestic Monetary Policy and Technology Subcommittee and the International Monetary Policy and Trade Subcommittee. The new Domestic and International Monetary Policy Subcommittee will be chaired by Rep. John Campbell, R-CA.
Other subcommittee chairmen include Rep. Scott Garrett, R-NJ, who will continue running the Capital Markets and Government-Sponsored Enterprises Subcommittee and Rep. Shelley Moore Capito, R-WV, who will serve as chair of the Financial Institutions and Consumer Credit Subcommittee.
Rep. Patrick McHenry, R-NC, will replace Rep. Randy Neugebauer, R-TX, as chairman of the Oversight and Investigations Subcommittee. Neugebauer will move over to chair the Insurance Housing and Community Opportunity Subcommittee.
On the other side of the aisle, Rep. Maxine Waters, D-CA, will replace the retiring Rep. Barney Frank, D-MA, as the committee’s Ranking Member.
Meanwhile, the Senate Banking Housing and Urban Affairs Committee hasn’t yet formally announced subcommittee leadership for the 113th Congress.
Sen. Tim Johnson, D-SD, will remain committee chairman while Sen. Mike Crapo, D-ID, will replace the term-limited Sen. Richard Shelby, R-AL, as the committee’s ranking member. Also, Sen. Jack Reed, D-RI, is expected to retain the gavel for the Banking Subcommittee on Securities, Insurance and Investment.
Although increased activity on GSE reform from both Congress and the Treasury Department is expected during 2013, there’s a “very low probability of any legislation becoming law,” concluded an analysis by FBR Capital Markets.
“We continue to believe that the real work on GSE reform continues to be undertaken by the FHFA under the direction of Acting Director Edward DeMarco,” said FBR. “This stealth GSE reform is working to standardize the contracts and procedures at Fannie Mae and Freddie Mac, as well as to establish a single securitization platform.”
Once this securitization is completed, concluded FBR, it would be easier for Congress to tackle the issue.
“We see it likely that Congress could end Fannie and Freddie in name but preserve the infrastructure of both,” added FBR. “This would prevent excess disruption in the mortgage market and allow the Treasury to continue to collect on the future profitability of the GSEs.”
Look for other Fannie, Freddie, Federal Housing Finance Agency and Federal Home Loan Bank news in the next issue of Inside The GSEs on Friday, Jan. 18, 2013.