The banking industry has had more success in Washington this year than any year in memory.
The American Bankers Association established five major legislative objectives at the beginning of 1994. It believed the year would be a pretty good one if a couple of the goals were achieved. By the time Congress. adjourned this fall, four of the five priorities had been accomplished:
* A regulatory-relief measure was ohtamed as part of the community development bank bill, despite initial objections to its inclusion from the chairmen of both the House and Senate banking committees.
* A significant and long-sought bankruptcy reform-bill was pushed through in the final days of the Congress, overcoming extreme partisan warfare.
* The attempt by the insurance agents to roll back bank insurance powers through a bill sponsored by Sen. Christopher Dodd was blocked in the Senate Banking Committee, despite the bill's overwhelming support in that committee a year earlier.
* The defeat of the Dodd passage of the interstate branching bill, possibly the most significant piece of banking legislation enacted since the Great Depression.
The only item on the ABAs agenda not achieved was legislation to limit the exposure of banks to vicarious liability on environmental claims brought against their customers. That highly complex political issue will be given high priority again next year.
There were many reasons for the successes, not the least of which was the degree of political involvement by so many of the industry's leaders. Bankers, angered by a decade-long string of political defeats and alarmed by severe losses in the industry's market share, were determined to change the tide, and they did.
My concern today is that the industry's leadership might heave a collective sigh of relief over their victories and lose their zest for continued political combat. Though far from conclusive, there are some signs this may be occurring.
Before the afterglow of a fabulous year had even begun to fade, some bankers were wondering whether their memberships in the trade associations, which cost next to nothing in the scheme of things, were justified. Moreover, participation in political activities by chief executives of major banks began to wail off.
My hope is that we are experiencing a pause, not new-found indifference. For in my judgment, the stakes in Washington for the banking industry over the next several years are huge.
Banks are scheduled to receive a reduction of more than $4 billion per year in deposit insurance premiums beginning in late 1995. Will they get all, some, or none of it?
Will the bank and savings and loan-deposit insurance funds be merged? If so, what will it cost the banks, and what will they get in return?
Will there be another push for consolidation of the regulatory agencies ? If so, will banks be able to block any measure that would restrict theft ability to select whatever organizational structure best minimizes their costs and maximizes their competitive freedoms?
Will we be able to repeal or at least liberalize substantially the Bank Holding Company Act? How about the Glass-Steagall Act?
Will the insurance agents press again on the Dodd legislation? Will the bankers be able to turn back those efforts and make progress in formally tearing down the barriers between banking and insurance?
Will the Federal Home Loan Bank System be modernized? How will those reforms affect the System's substantial and growing base of bank members?
Will the industry be able to roll back the scope of the deposit insurance system to eliminate the "too big to fail" doctrine and make banking in the U.S. more freeenterprise in nature? If so, will those reforms foster a climate in which the industry's regulatory burden can be reduced further?
Bankers should indeed savor their recent hard-earned political victories. But not for long. They must quickly regain their fervor for waging the even larger battles ahead.
Mr. Isaac, a former chairman of the Federal Deposit Insurance Corp., is chairman and CEO of Secura Group, a financiti institutions consulting firm m Washington.
