For Baptista Lost Cause Is Reborn
In his last four years of lobbying, Sam Baptista can count his legislative victories on one hand. Well, O.K., make that one finger.
Still, when Mr. Baptista wins, he wins big. Last week, when the House Banking Committee voted to authorize nonfinancial companies to own banks, he triumphed on an issue that until recently the entire town had written off as a lost cause.
Granted, Mr. Baptista still has a long ways to go. Before his legislative quest can be enshrined in law, it must pass through the hostile territory of the House Energy and Commerce Committee and the Senate Banking Committee, not to mention the House and Senate floors. Mr. Baptista puts the odds at "only slightly better than 50-50."
But even if the banking and commerce measure is not part of the bill that goes to the President's desk this year or next, Mr. Baptista and others believe the banking committee vote has permanently changed the terms of the debate: a point of view once regarded as unthinkable has been given respectability.
That is quite a turnabout from the situation in 1987, when Congress closed the so-called non-bank bank loophole, a provision that permitted commercial and industrial concerns to own limited-service commercial banks.
Mr. Baptista said he wasn't discouraged by that vote.
Loophole Seen as Problem
"I always thought they closed it because it was a loophole, because it permitted companies to operate outside the prescribed structure," he said.
As a lobbyist for the American Financial Services Association and spokesman for the Mayflower Group, a coalition of big banks, securities firms and diversified financial companies - Mr. Baptista had been at work for a year already in crafting a bill that would permit bank affiliations with nonfinancial companies. With passage of the 1987 law, he became president of the newly formed Financial Services Council, the successor to the Mayflower Group.
He started with few allies. His principal one was Rep. Doug Bernard, D-Ga., a former banker whose efforts to modernize the banking system had consistently been frustrated. But a big break came this year when Treasury Secretary Nicholas Brady agreed to recommend that Congress end the separation of banking and commerce.
Much Consideration by Brady
That was no easy battle, Mr. Baptista recalled. Mr. Brady "did a lot of sould searching," before endorsing the Financial Services Council position.
Should Mr. Baptista prevail this year, he may effectively have worked himself out of a job, since the Financial Services Council is a one-issue trade group.