Senate committee clears Smith to head up FHFA

The Senate Banking Committee approved President Obama’s nominee, Joseph Smith, as director of the Federal Housing Finance Agency, the conservator of Fannie Mae and Freddie Mac. However, at least one senator aired concerns on the lack of strength Smith may bring to the post. The nomination, which cleared the committee in a 16-6 vote, still needs full Senate approval. Smith currently serves as the North Carolina commissioner of banks and will replace FHFA Acting Director Edward DeMarco. If approved, Smith will play a pivotal role in the fates of the troubled government-sponsored enterprises. “Mr. Smith brings to this position both tremendous expertise and a deep commitment to strengthening our housing finance system for the American people,” Obama said when he made the nomination. But Sen. Richard Shelby (R-Ala.), ranking Republican on the committee, voted against Smith, challenging his credentials to sort out two companies that have already cost taxpayers nearly $150 billion. “The first confirmed director must hit the ground running — equipped with the skills and experience needed to be a strong regulator free from influence by the current administration,” Shelby said in a released statement. “In other words, we need a watchdog not a lapdog.” Speaking before the committee earlier in December, Smith pledged leadership in determining how to meet the local needs of regulating Fannie and Freddie. “The activities of Fannie Mae and Freddie Mac are national in scope but local in impact, directly affecting communities across the country,” Smith said. “Leadership in this context means determining how to address critical local needs in conjunction with the agency’s duties of conservatorship.” Write to Jon Prior.