Two key lawmakers predicted Thursday that broad financial modernization legislation will not pass this year.
Sen. Robert Bennett said the Senate won't take up the issue unless the House passes a bill first. The Utah Republican said he is skeptical that House Banking Committee Chairman Jim Leach's legislation can pass.
"Last year it was clear that Chairman Leach could not impose his view on the House Banking Committee," said Sen. Bennett, chairman of the Senate Banking financial services and technology subcommittee. "If we see a repeat on the House side, my guess is you won't see much activity in the Senate either."
Despite recent progress, industry groups are still too far apart on controversial issues such as state regulation of bank insurance sales, added Rep. Michael Oxley, R-Ohio.
"The field is strewn with the bodies of people who have pushed for financial modernization," said Rep. Oxley, chairman of the House Commerce Committee's commerce, trade, and hazardous materials panel.
Nevertheless, Rep. Oxley said lawmakers shouldn't give up. He complained that regulators have put securities and insurance firms at a competitive disadvantage by expanding bank powers. "I believe there should be a two-way street," he said.
Both lawmakers made their comments at the Securities Traders Association's Washington conference. - Bill McConnell