Senior Democrats want Obama to keep FDIC chief

WASHINGTON (Reuters) - Rep. Barney Frank said on Thursday he and Sen. Christopher Dodd are urging President-elect Barack Obama to retain Sheila Bair as the chairman of the Federal Deposit Insurance Corp and possibly give her a larger role to regulate mortgages.

Frank, chairman of the House Financial Services Committee, also told reporters at a consumer banking conference that at the moment Congress would not be willing to approve the rest of funding for the $700 billion financial rescue package.

Frank, a Massachusetts Democrat, said "at the very least" the Treasury Department will need to use the funds to halt home foreclosures. Dodd, a Connecticut Democrat, is chairman of the Senate Banking Committee.

(Reporting by John Poirier)