Bank-Sponsored Compromise Plan On Insurance Ban Going Nowhere

two-year freeze on new insurance powers in return for repeal of the Glass- Steagall Act. But the compromise proposed by the Bankers Roundtable appears to be too little, too late. Insurance agents have no reason to negotiate because they have already convinced House Republican leaders to bar the Comptroller of the Currency from expanding national banks' insurance powers. "We have not heard anything from the bankers that is giving anything to us," said Bob Rusbuldt, vice president of federal affairs for the Independent Insurance Agents of America. The Bankers Roundtable, a trade group of large banks, Tuesday asked House Banking Chairman Jim Leach to shorten a proposed moratorium on the Comptroller of the Currency to two years from five in an attempt to generate support among bankers for Rep. Leach's Glass-Steagall repeal bill. The Roundtable proposal also would limit state insurance regulators' ability to govern insurance sales by national banks. Wednesday, representatives from the insurance industry met with House banking committee staffers to discuss the proposal, but so far, insurers have little interest in weakening the powers of state regulators. "We have already compromised and we think we have been more than reasonable," Mr. Rusbuldt said. The agents originally sought a permanent ban of the Comptroller's ability to expand bank insurance powers. The insurance restrictions are attached to a Glass-Steagall/regulatory relief bill pending in the House. Large banks are desperate for the new securities underwriting powers the bill would allow, but the industry is split over the legislation because of the insurance restrictions. Anthony T. Cluff, the Roundtable's executive director, is undaunted. "We just want to push forward some ideas and see if we can't spring a bill out of the House," he said. But other banking trade groups are skeptical. "Everybody thinks it would be difficult to get agents to agree at this point," said American Bankers Association chief lobbyist Edward L. Yingling. Besides, the current budget stalemate is dominating Congress, and Glass- Steagall repeal is unlikely to get more attention this year, said Alexandria, Va., banking consultant Bert Ely. Banking industry opposition to the insurance restrictions has made House leaders reluctant to bring the Glass-Steagall/regulatory relief bill to the House floor for a vote. Officials in the Comptroller's office said they have not had time to review the proposal and declined to comment Wednesday.