Republicans scuffle over US House banking panel

* Aides see Bachus prevailing over rival for chair

* Royce claim could be marker for two years from now

* No final decisions on chairs likely until December

By Kevin Drawbaugh

WASHINGTON, Nov 4 (BestGrowthStock) – Just days after winning
control of the U.S. House of Representatives, Republican
leaders on Thursday faced an internal fight over the
chairmanship of a key committee that oversees Wall Street.

Representative Spencer Bachus was expected to prevail over
rival Ed Royce to become the next head of the House Financial
Services Committee, aides said, but the struggle could play a
role in setting the panel’s agenda for 2011-12.

Royce, from California, announced in a statement late on
Wednesday that he was challenging Bachus, the panel’s top
Republican and heir-apparent to the chairmanship.

However, Bachus claimed to have the race all but sewn up.

“I’ve spoken to my colleagues on the steering committee and
in leadership and I have their overwhelming support and fully
expect to serve as the chairman,” the Alabama congressman told
Reuters earlier in the day.

The Royce challenge underscores lingering doubts about
Bachus, whose leadership has been questioned before by
colleagues. After difficult negotiations with Democrats over
the 2008 bank bailouts, Bachus had to beat back an attempt to
oust him as ranking minority member of the committee.

He prevailed then, however, with the support of John
Boehner, due to become speaker of the House — the top post in
the chamber — in the next Congress. Aides said the
Boehner-Bachus connection is still strong.


If he becomes chairman, Bachus will have to step aside in
two years under party term limit rules. The challenge being
made now by Royce may actually be his way of laying claim to
the chairmanship in 2012, some aides said.

The committee, with more than 70 members, is one of the
largest in Congress. Banks, insurers and other deep-pocketed
financial firms regularly pour money into the campaign coffers
of the panel’s members.

Boehner and other top Republicans will determine who gets
the head posts at financial services and other committees.

“Those decisions will be made by the steering committee at
the appropriate time,” Boehner spokesman Kevin Smith said.

Decisions will not be made for a few more weeks. Congress
is in recess until the week of Nov. 15. House Republicans will
hold leadership elections that week. Appointments to
chairmanships will not start until December, aides said.

Democratic Representative Barney Frank, the current head of
the committee, won re-election on Tuesday, but with the control
of the House changing hands, he looses his chairmanship.

Either Bachus or Royce would represent a dramatic change
from Frank, with Republicans vowing to attack landmark banking
reforms pushed through earlier this year by Democrats.

Both Bachus and Royce want to reform the broken U.S.
housing finance market and the mortgage giants at the center of
it — Fannie Mae (FNMA.OB: ) and Freddie Mac (FMCC.OB: ), which are
known as government-sponsored enterprises, or GSEs.

Bachus said on Wednesday that the GSEs should be liquidated
and government removed as much as possible from the housing
market. Analysts doubt a major reform will occur before 2012.

Royce has long been an advocate of giving insurance
companies the option of answering to a federal regulator. If he
were named chairman, he would likely move this controversial
issue up the committee’s list of priorities, aides said.

While Royce is among the most senior members of the
committee, he is not in line to take over any of the panel’s
six subcommittees.

For Republicans, seniority is one of a number of factors
considered in choosing committee chairmen. Representatives Jeb
Hensarling and Scott Garrett, though well down the seniority
list, have also been seen as potential rivals to Bachus.

Hensarling, meanwhile, has announced he wants to be
Republican Conference chairman — a top leadership post — and
he has wide support.

(Editing by Will Dunham)

Republicans scuffle over US House banking panel