Bill Seeks To Bar Wal-Mart From Owning an ILC (Again)

WASHINGTON - The House overwhelmingly approved a bill last week to bar commercial firms such as Wal-Mart from owning industrial loan companies and state-chartered banks. But the bill is expected to run into major opposition in the Senate, where Bob Bennett, Senator from Utah, which is home of half the ILCs, has a prominent seat on the banking committee.

The bill was introduced in the House to prevent retail giant Wal-Mart from owning a bank-such as the one owned by competitor Target Stores-but appears to have lost some of its impetus since Wal-Mart withdrew its ILC application.

Still, key members of both parties hope to maintain the traditional barrier between banking and commerce, which has been in effect since the Great Depression.

The bill would have no effect on any CU applications for an ILC because it requires that an ILC applicant conduct at least 85% of its business in financial services.