The Senate Banking Committee has postponed voting on the financial reform bill until September, further diminishing the controversial legislation's chances of enactment this year.
Chairman Alfonse M. D'Amato met with fellow committee Republicans last week and decided to hold off because of other legislative priorities and continuing efforts to compromise with banking industry opponents of the reform bill, sources here said Monday.
"Time is sort of running short now" because Congress has less than two months of work left before adjournment, a committee aide said. "Members have other stuff going on."
Work in the Senate has bogged down on health-care, tobacco, and appropriation bills. Plenty of other banking legislation remains undone, too.
Senate Republican leaders aim to vote within the next two weeks on the credit union and private mortgage insurance reform bills and approve bankruptcy reform this month. The Banking Committee has scheduled a July 29 vote on regulatory relief legislation, and Sen. D'Amato has set hearings this week on ATM surcharges and mortgage disclosure laws.
Senate passage of financial reform legislation remains a long shot, but a vote in Senate Banking would set the stage for debate next year, said Edward L. Yingling, chief lobbyist for the American Bankers Association.
Still, supporters have not given up.
"Whether the bill is reported out of committee at the end of July or early September is really not going to have any bearing on full Senate consideration," said Samuel J. Baptista, president of the Financial Services Council. Although the Senate has a crowded agenda, he said, "a lot can get done at the end of a session."
The delay provides more time for compromises to be negotiated, Mr. Baptista added. A top D'Amato staffer met Monday with banking and insurance industry representatives to discuss changes to the bill's insurance sales provisions.
The committee is considering dropping the requirement that banks offer low-cost accounts to needy customers and restricting the sale of unitary thrift holding companies that are grandfathered by the bill, sources said. However, no progress has been made on the major stumbling block: whether new financial powers should be housed in holding company units or bank operating subsidiaries.