Republicans on Capitol Hill want Richard Cordray as Fed chief

President Joe Biden may have avoided a partisan showdown in the Senate by re-nominating Jerome Powell as the Federal Reserve chief, but Republicans on Capitol Hill aren't giving him the benefit of the doubt when it comes to the three additional nominations he's expected to make in the coming weeks.

The White House is considering nominating former Consumer Financial Protection Bureau Director Richard Cordray as the top banking XLF regulator, according to news reports on Tuesday.

Richard is left of Lenin, Republican Sen. John Kennedy of Louisiana told CNBC Tuesday. Richard believes that only government can make America great. He and I disagree. Kennedy sits on the Senate Banking Committee, which would have to approve a nominee to the Federal Reserve Board of Governors before it can be referred to for confirmation by the full Senate. In an evenly split Senate where Republicans and Democrats have equal representation at the committee level, nominees can advance from a deadlocked committee vote at the discretion of Democratic Senate Majority Leader Chuck Schumer of New York.

The Republicans wouldn't have the power to block Cordray's confirmation in the Senate in the face of united Democratic support, but they will not go down without a fight, given that Cordray has been a thorn in the side of the banking industry and its allies on Capitol Hill.

In a tweet Tuesday, Congressman Blaine Luetkemeyer of Missouri, a senior Republican on the House Financial Services Committee, said that Cordray, as CFPB director, made it his mission to bog down the U.S. financial services industry with as many regulations as possible. Cordray would replace Gov. Randal Quarles is planning to leave the Fed at the end of the year after his term ended in October.

Quarles, a Republican and former bank lawyer who was appointed by former President Donald Trump in 2017, presided over years of deregulation at the Fed, including moves to roll back capital and liquidity requirements for all but a handful of the nation's largest banks. The changes, partially spurred by bipartisan deregulatory legislation passed in 2018, proved to be a boon for large regional banks KRE, with less than $250 billion in assets.

Progressives like Democratic Sen. Elizabeth Warren of Massachusetts are hoping that a new vice chairman for supervision would be able to reverse some of what Quarles did in recent years. She opposes Powell's renomination to chair the Fed on the grounds that deregulation on his watch made him a dangerous man to head up the Fed. In 2012, Warren worked with Cordray as he became the first Senate-confirmed director of the CFPB.

Cordray would need the support of Senate Banking Committee Chairman Sherrod Brown, who has also been critical of the Fed's banking oversight of late. Brown, an Ohio Democrat, said he likes him. I am talking to the White House about him and a number of other people. The White House declined to comment on Cordray's potential nomination, referring to a statement issued last week by MarketWatch that Biden will begin making appointments in early December.