WASHINGTON — Two different interpretations of this week's historic midterm elections emerged on Wednesday, with both sides competing to say how the vote would impact the financial services world.

On the one hand, House Republicans, who retook the chamber after four years, saw their victory as a mandate to overturn much of the Dodd-Frank law, with some calling for the elimination of the new Consumer Financial Protection Bureau, while fully privatizing the housing finance sector.

Senate Democrats, who remained in control despite a narrow majority, acknowledged the vote was a call for more moderation and consensus, but warned their House colleagues not to refight unwinnable battles.

"I don't think that major changes will take place on Dodd-Frank," said Sen. Tim Johnson, D-S.D., who is expected to chair the Senate Banking Committee next year. "It's a matter of minor changes taking place. There is not only resistance from the Senate, but the veto is possible, too. So we should focus on realistic solutions to our problems."

With the Dodd-Frank bill out of the legislative arena and into the regulatory arena, Marilyn Mohrman-Gillis, Managing Director of Public Policy & Communications at the Certified Financial Planner Board of Standards,  said her sense was that there would be little impact. Unless of course there was a repeal of the bill, which shedoesn't think is "politically likely, feasible, or in the cards."

"These landmark pieces of legislation don’t happen that often," said Mohrman-Gillis. "My sense is we are in a settling in period and that the Dodd-Frank bill has to go through the rulemaking process and implementation process, but I don’t see a huge shift in our world whether there's a GOP in charge of the House or Democratic leadedrship in charge of the House."

While it is clear, she said, that many believed the governemtn has become too big, which is why there was a pushback at the polls on Tuesday, I don’t think that financial regulatory reform will be repealed. 

This view was clearly not shared by top House Republicans, who pledged to have a go at Dodd-Frank as soon as possible.

Rep. Scott Garrett, who hopes to chair the capital markets subcommittee, took a hard-line stance Wednesday, calling on the administration to dismantle the new consumer bureau before it is even started.

"We don't need a CFPB," he said. "That would be a great first step for this administration if they want to start showing how they are willing to work with us, to say that, ‘We recognize the failure that this doesn't do anything to address the problems so let's start unwinding that.' "

In an interview, Rep. Spencer Bachus, R-Ala., who is the lead candidate to chair the Financial Services Committee, did not go as far. He said instead the CFPB should have its budget cut and its structure overhauled.

Garrett also said the House Financial Services Committee should address the risk-retention provisions of Dodd-Frank, which he warned could harm the market.

"What we are hearing from the CMS market is that everything is on hold because of how this is all going to play out," Garrett said, noting regulators are still studying how they will formulate risk-retention rules. "So we need to address that probably very soon, because if we fail to address that now, you'll just continue to see the securitization market continue to be somewhat paralyzed, and we can't have that."

Rep. Randy Neugebauer, R-Texas, the panel's current vice ranking member, agreed a top priority was to revamp some of the Dodd-Frank provisions, calling the law "overreaching."

"One of our bigger fears is that when the regulations and implementation are started, that they'll even be more far-reaching than the legislation. And if that's the case, then I think you are going to see us try to take some action to make some corrections there," he said.

Specifically, Neugebauer said he would like to separate the consumer bureau from the Federal Reserve Board (where it is housed), cut its funding and increase congressional oversight.

Mohrman-Gillis admitted the prospects for additional legislation in the next two years were slim. While the CFP will be looking for opportunities to have hearings and get a bill introduced, she thinks it will be a fairly quiet time, though she anticiaptes the SEC will engage in rulemaking on the fiduciary standard. "The real impact will occur in the SEC," she added.  

Neugebauer said Republicans were also focused on housing finance reform, but would be careful to move forward in a way that doesn't spook the markets.

"We need to be very methodical, but we also need to be sure that we get this right, because the American economy is very fragile right now," Neugebauer said. "If we do something that is not all that positive to the markets, we may be creating a worse problem than we are trying to fix."

For his part, Johnson agreed that the government-sponsored enterprises were a top priority, but said he would wait on the administration's proposal before taking action. He said he hoped after that point to work with Sen. Richard Shelby, the panel's top Republican, to craft a bipartisan bill.

"I've always believed in consensus," Johnson said. "That was my style yesterday before the elections and my style today after the elections. No one party has all the right or wrong answers."

But GSE reform and oversight of Dodd-Frank were not the only items on Republicans' minds. Rep. Shelley Moore Capito, the top Republican on the housing subcommittee, said she wants to concentrate on the administration's foreclosure prevention program, which she said has proven to be a failure.

"I would like to see some greater oversight into the foreclosure programs that the administration has put forward," Capito said in an interview. "The effectiveness, the money, where it is and what it's being used for — that to me is a big issue. … Obviously they are floundering, and I think we need to focus and look at that issue."

Capito is also concerned about the regulatory burden faced by community banks. The panel needs to look at a way to help them, she said.

"We need to look at some regulatory streamlining and I was talking to our local bankers here and they have four and five regulators coming in," she said. "I think that's something that probably was an intent of the original financial reform package and got lost."

House Democrats, meanwhile, were taking a wait-and-see approach to determine what role they will play next year. Rep. Mel Watt, D-N.C., said Republicans should take the lead on fixing the housing finance issue after years of criticizing the Democrats' ideas.

"Among the biggest issues is how we deal with Fannie and Freddie and deal with housing in the country," Watt said. "They are going to have to answer that question, and it will be interesting to see how they answer it compared to how we would have answered it."

But like other House lawmakers, Watt saw little sign there would be a bipartisan consensus around that or many other issues.

"Financial services historically has tended to be less partisan," he said, but "over the last several years it has become more partisan because the Republican leadership has put more partisan people … in leadership positions. It's been more difficult to find consensus. If the Republican leadership continues down that path, then it could be kind of contentious going forward."

Rep. Luis Gutierrez, the chairman of the financial institutions subcommittee, said in an e-mail to American Banker that he plans to keep fighting to protect consumers and to investigate the foreclosure mess and hopes that Republicans won't seek to undermine Democrats' recent achievements.

"I hope that the significant progress we have made toward strong and popular consumer protections and financial reform … over the past years will not be reversed. I look forward to meeting with the new chair and seeing where we can find common ground to work together," the Illinois Democrat said.