Jay Janis, President Carter's nominee to be the next chairman of the Federal Home Loan Bank Board, progressed toward confirmation yesterday with minimal opposition at his House hearing. His nomination is expected to go to the Senate early next week.
His chief challenger -- who wasn't even present -- is Rep. Benjamin S. Rosenthal (D-N.Y.). Senate Banking Committee Chairman William Proxmire (D-Wis.) read a letter from Rosenthal questioning whether Janis' housing-lending background might not prejudice him against the small saver.
Before serving as undersecretary of Housing and Urban Development under Patricia Harris, Janis, 46, was a community developer in Florida and a director of a savings and loan association there.
At HUD, Janis served as vice chairman of an interagency task force on Regulation Q, which puts a ceiling on the rate of interest that financial institutions can pay on savings accounts. The task force recommended the ceiling be lifted, but HUD wanted to retain it because, it said, increased interest on savings accounts would lead to higher mortgage rates.
Although Janis testified that he now supports the administration's bill to phase out Regulation Q gradually, Rosenthal is known to fear that Janis won't actively promote lifting the ceiling, a move that eventually would lead to higher interest rates being paid to all savers.
Proxmire pressed Janis to make equity for small savers a priority for the bank board. Janis replied that, although he favors giving better advantages to the small saver, his key goal will be to make savings and loans more competitive with banks, credit unions and money market mutual funds.
Janis said in this context that he supports nationwide establishment of NOW, or checking-with-interest accounts, and the concept of savings and loan associations as family finance centers making consumer as well as mortgage loans. He said thrifts also should develop new souces of funds, such as commercial paper, Eurobonds and subordinated debentures.
Janis said he would like thrifts to play a role in Carter's solar energy bank; yet, he emphasized that thrifts should maintain their special role of providing financing for housing, rather than becoming commercial banks.
Janis pledged that the FHLBB wouldn't back away from the strong stance it took under his predecessor, Robert McKinney, on social issues such as community reinvestment and redlining. The nominee admitted to a "somewhat negative" opinion on interstate branching for financial institutions, not wanting large associations to take over small ones. But he said he would await White House recommendations on changing the McFadden Act -- now expected in mid-October -- before deciding on interstate branching in the Washington metropolitan area or elsewhere.
Janis again said his opinion was "somewhat negative" on the conversion of mutual savings and loan associations to stock companies, citing the possibility of windfall profits for insiders.
Janis clashed with Sen. Robert Morgan (D-N.C.) by endorsing pre-empting of state laws such as usury ceilings and mortgage assumptions. Morgan threatened to vote against the appointment unless Janis assured him in writing that he respected state laws.