Rep. John Linder, chairman of the National Republican Congressional Committee, told big-bank lobbyists last week that he plans to co-sponsor legislation allowing banks and nonfinancial firms to merge.
The Georgian would become the first member of the GOP leadership to pick a side in the financial modernization debate. The legislation is sponsored in the House by Rep. Richard Baker, R-La., and in the Senate by Banking Committee Chairman Alfonse M. D'Amato, R-N.Y.
Competing proposals have been introduced by House Banking's top two Republicans, Jim Leach of Iowa and Marge Roukema of New Jersey.
Rep. Linder said he expected House leaders to take a strong role in pushing financial reform legislation to a vote, according to sources attending the annual meeting of the American Bankers Association's Legislative Liaison Advisory Committee, or Lilac, in Palm Springs, Calif.
Rep. Linder also said he expected a "working group" headed by John Boehner of Ohio, the House Republican Conference chairman, to be appointed shortly. Rep. Linder said the task force would tackle contentious points such as industry disputes over bank insurance sales, but leave bulk of the bill to the banking committee.
With big-name co-sponsors slow to sign on, credit union groups may ask friendly lawmakers to introduce legislation expanding access to credit unions in the next couple of weeks.
Since mid-February the groups have asked allies in Congress to hold off until a bipartisan slate of high-profile supporters could be recruited.
But many lawmakers appear reluctant to come forward following the Supreme Court's Feb. 24 decision to hear the case challenging whether credit unions may serve employees at more than one company. (A decision is not expected until early next year and Congress often defers action while cases are pending before the high court.)
Charles O. Zuver, director of governmental affairs for the Credit Union National Association, conceded that the court's action has caused possible supporters to back off.
"We are running into that argument: 'Let's wait for the court to decide,' " he said.
Officials from CUNA and the National Association of Federal Credit Unions met on Monday to discuss strategy.
"Our policy is to seek out a well-balanced bill and get it introduced," he said. "But we know we can't wait. If we lose the Supreme Court case, we must have legislation ready in Congress."
Mr. Zuver wouldn't identify lawmakers who have agreed to sponsor the Credit Union Membership Access Act, which would allow a credit union to serve multiple membership groups as long as each group had a "common bond."
"It was Gene Ludwig's job to say Jim Leach had an ugly baby," Rep. Bruce Vento, D-Minn., quipped to lobbyists at the ABA Lilac meeting. Rep. Vento was recounting last year's disputes over financial modernization legislation between Rep. Leach and Comptroller of the Currency Eugene A. Ludwig... Democratic Banking Committee staffer Mitchell L. Feurer is stepping down after six years to launch a lobbying office for Charles Schwab & Co.
