Treasury Under Secretary John D. Hawke Jr. on Monday panned House leaders' plans to attach regulatory relief legislation to a budget bill that must be enacted by April 24.
"That has no chance of happening," Mr. Hawke said after a speech at the spring meeting of the Independent Bankers Association of America. He said the regulatory relief bill contains too many controversial provisions, such as Community Reinvestment Act exemptions for small banks, which the Clinton administration opposes.
IBAA executive vice president Kenneth A. Guenther said House leaders, such as Majority Whip Tom DeLay, R-Tex., are "very interested" in adding regulatory relief provisions to the must-pass continuing resolution.
Bank regulators and administration officials have been trying desperately for weeks to attach the thrift insurance fund rescue to this budget bill.
Mr. Guenther said House leaders are looking at the reg relief provisions as a way to entice support for the Savings Association Insurance Fund fix from the banking industry.
Banks oppose the rescue because it would force the industry to pay about $12 billion over the next 21 years in Financing Corp. bond interest. The administration is supporting a change in the bill that would delay banks' contribution to Fico until Jan. 1. However, banks are unlikely to win a rebate of excess premiums paid in 1995.
The legislation also would raise $6 billion to rebuild the thrift fund through a one-time fee on thrift deposits.
Industry lobbyists are predicting the thrift fund fix will make it on the spending bill but say there is not enough time to add regulatory relief, because the Senate and House versions of the bill are so different.
"You would have to have the two banking committees have a conference," one lobbyist said. "Where's the time for that?"
In his speech, Mr. Hawke said it is also too late to pin some of the Fico cost on credit unions or government-sponsored enterprises such as Fannie Mae and Freddie Mac, as some banks are advocating.
The fact that credit unions compete with banks but are tax-exempt "warrants a reexamination of the playing field," Mr. Hawke admitted.
