Obama Expected to Nominate Watt to Lead FHFA

WASHINGTON — President Obama is expected to nominate Rep. Mel Watt, D-N.C., on Wednesday to head the Federal Housing Finance Agency, according to sources, a move that is likely to spark a fierce confirmation battle.

Watt's name was first floated last month, and already spurred opposition from at least one Senate Republican, Sen. Bob Corker, who said such a pick would be too political.

Watt has been praised by consumer groups for his experience on the House Financial Services Committee and his extensive work on housing issues. Even before an official announcement was made, Rep. Elijah Cummings, the lead Democrat on the House Oversight Committee, said Watt was a great choice.

"I am very encouraged by recent reports that the President is planning to nominate Mel Watt to head the FHFA," Cummings said in a press release. "Congressman Watt has deep expertise in housing policy and a record of distinguished service on the House Financial Services Committee.  He will be an excellent Director for FHFA."

Bloomberg first reported the news of Watt's pending nomination on Wednesday. Since his name was initially discussed, other media reports have suggested Mark Zandi, an economist, was also in the running to lead the FHFA.

The agency is currently headed by Ed DeMarco, a Bush appointee, who has been heavily criticized by the administration and many Democrats for refusing to allow principal reductions on loans owned by Fannie Mae and Freddie Mac, which are under conservatorship.

But Republicans have defended DeMarco and fought previous attempts to confirm a successor.

The Obama administration nominated Joseph Smith, North Carolina's former banking commissioner, to head the FHFA, but withdrew his nomination after Sen. Richard Shelby and other GOP lawmakers said they would oppose him.

Corker has already signaled his intent to oppose Watt's nomination.

"The administration recently has floated a name through the press for a person to lead the GSEs," Corker said last month. "I'm all for politicians going on to grander things, but I think the GSEs are a very unusual situation and that is, we really need somebody with technical strength and with no political bias whatsoever to help us walk through this. And the last thing we need is a politician who's been involved in these issues for years leading the organization."