WASHINGTON Jan 16 U.S. Housing and Urban
Development Secretary Shaun Donovan will continue in his current
role for a second term under President Barack Obama, an agency
spokesman said on Wednesday.
Donovan, who was New York City's housing commissioner before
taking the top U.S. housing post in 2009, is expected to play a
central role in the Obama administration's efforts to keep the
Federal Housing Administration solvent.
The FHA, which falls under HUD's umbrella, is facing a
projected $16.3 billion capital shortfall and may need a
taxpayer bailout for the first time in its 79-year history.
Donovan, 46, was a chief negotiator in the historic $25
billion settlement reached a year ago with the nation's five
biggest banks and 49 state attorneys general to end a probe of
abusive lending practices stemming from the housing bubble.
Shortly after his re-election, Obama appointed Donovan to
lead rebuilding efforts in areas that suffered damage by
Superstorm Sandy, which ravaged the East Coast in late October.
He was widely expected to stay on.
During Donovan's second term, administration officials and
lawmakers in Washington are expected to draw up more concrete
plans on the government's future role in the mortgage market,
including the fate of housing giants Fannie Mae and
The government seized control of Fannie Mae and Freddie Mac
at the height of the financial crisis in 2008 as mortgage losses