Capital Briefs: Clinton Expected to Sign State-Bank Branch Bill

Following House approval Tuesday, President Clinton is expected to sign legislation making it easier for state banks to branch across state lines.

The measure, sponsored by Rep. Marge Roukema, R-N.J., would let state banks exercise powers allowed by their home state regulators when they branch into other states. However, these activities would be limited to those permitted to national banks.

The Conference of State Bank Supervisors pushed for the legislation, arguing that without the change state banks would switch to federal charters to avoid the hassle of conflicting state laws.

"This legislation ensures that the dual banking system benefits will continue," said Neil Milner, CSBS president.

The legislation, passed by the Senate on June 12, also would require the Office of the Comptroller to report to Congress all state laws preempted since 1992. Also, the Comptroller's Office must report annually on future preemptions.

The bill also included a provision that would let Wisconsin, Iowa, and Puerto Rico continue to cap interest rates their residents pay to out-of- state state-chartered banks, thrifts, and credit unions.