With financial reform legislation poised to head to the full Senate, banking trade groups are giving mixed signals on whether they support the historic bill.

Though the American Bankers Association is on board, small-bank and big- bank associations have refused to endorse the legislation.

Still, industry officials contended that the groups remain united and that only fine distinctions separate them.

"The three trade groups are very, very close not only in their positions but in their specific areas of concern," said ABA chief lobbyist Edward L. Yingling. "I am confident we will be able to work together."

After the Senate Banking Committee approved reform legislation on a 16- to-2 vote Friday, the ABA immediately announced its "cautiously optimistic" support for the bill. The group threatened to withdraw that endorsement, however, if key pro-bank changes that the committee made to the House bill are removed.

Other groups were more deliberate.

The legislative and executive committees of the Independent Bankers Association of America met over the weekend in Chicago and officially softened the group's stance to "no opposition."

Kenneth A. Guenther, executive vice president of the IBAA, said Tuesday that Senate Banking's version was better than the House bill because it would strengthen protections for bank sales of insurance from unfair state laws, let national banks sell title insurance, and bar the deposit insurance funds from bailing out nonbank units of financial conglomerates.

The group stopped short of declaring full support because the bill "will accelerate the merger wave across the financial services industry," Mr. Guenther said. He also complained that the legislation still would create uninsured, wholesale financial institutions and partially scale back the power of federal bank regulators to defend in court their decisions to override state laws.

Yet the group decided that industry consolidation may be inevitable and that the ban on bank ownership of commercial businesses in both bills-which small banks covet as a protection from conglomerates-might be dropped by the new Congress next year, he said.

The Bankers Roundtable issued an even more hedged statement Tuesday. The group said the Senate Banking bill contains "significant improvements" but suggested it wants stronger protections for insurance activities of banks and more powers for direct operating subsidiaries.

The splintered banking industry message adds to the political confusion over the bill after last week's vote. For instance, Senate Banking's addition of limits on the transfer of ownership of unitary thrift holding companies has riled the thrift industry.

And longtime backers are raising objections. The Independent Insurance Agents of America withdrew its support of the bill last week because of pro-bank changes to the insurance provisions. Meanwhile, the American Council of Life Insurance threatened to oppose the bill if measures that would ease the conversion of mutual life insurance companies to stock- issuing holding companies are not restored. Senate Banking Chairman Alfonse M. D'Amato removed the provisions to protect New York insurance laws, sources said.

It is unclear when, or if, the Senate will vote. Senate Majority Leader Trent Lott said on the chamber floor Monday that he would try to schedule a vote before adjournment Oct. 9 but suggested it would be difficult to find time this month.

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