Conservative group backs Royce for Financial Services chair

In a letter sent to members of the House Republican Steering Committee, David Keene backed Royce for the position over the presumed favorite, Rep. Spencer BachusSpencer Thomas BachusOvernight Finance: Trump, lawmakers take key step to immigration deal | Trump urges Congress to bring back earmarks | Tax law poised to create windfall for states | Trump to attend Davos | Dimon walks back bitcoin criticism Manufacturers press Senate to approve Ex-Im board members Now is the time to fix Ex-Im Bank MORE (R-Ala.). As ranking minority member on the committee, Bachus is officially next in line when Republicans take control of the House in January. However, Royce has received some high-profile conservative support, including an endorsement by The Wall Street Journal's editorial board.

The endorsement comes with a slight jab at former committee chairman Mike Oxley (R-Ohio), who Keene said acquiesced to the "formidable" Frank and opposed any significant reform of Fannie Mae and Freddie Mac. Oxley retired in 2007. 

That lack of reform contributed to the subprime mortgage crisis, Keene said.

"[Frank's] success was a key factor in the debacle that followed, resulting in a government takeover of Fannie Mae and Freddie Mac, along with 90% of the nation’s housing market," Keene wrote. "Royce .. was in the forefront of those who fought for GSE reform when it counted, and has the leadership qualities grass roots conservatives are looking for as part of the new Republican majority."

Royce and Bachus are currently making their cases to steering committee members and House GOP leadership. Royce made his presentation to the committee on Tuesday — a decision is expected to come sometime next week.