Speaker Newt Gingrich this week gave the leaders of the House Banking and Commerce committees until next Wednesday to reach a compromise on stalled financial reform legislation.
"Fundamental reform and modernization of the laws governing America's financial services industry has moved another step closer to reality," according to a joint statement released by Rep. Gingrich and key House Republicans Thursday.
The House leadership is "emphatically committed" to bringing financial services reform legislation to the floor before the two-week congressional recess that starts April 2.
The speaker set the short deadline at a meeting Wednesday that included House Majority Leader Richard K. Armey, Republican Conference Chairman John A. Boehner, and the two committee chairmen.
If the Banking and Commerce committees cannot break their three-month deadlock, Republican leaders promised to resolve any outstanding matters themselves, sources said.
Although many disputes remain among sectors of the financial industry, several lobbyists pointed to Rep. Gingrich's edict as a possible turning point.
"They clearly have stepped on the gas," said Edward L. Yingling, chief lobbyist for the American Bankers Association.
"I am definitely more optimistic than I was a week ago," said Robert A. Rusbuldt, senior vice president of government affairs for the Independent Insurance Agents of America.
Others were skeptical.
"Frankly, it's not like this is the first time this has happened," said Rep. David T. Dreier, R-Calif. The Rules Committee vice chairman said he wants to substitute a scaled-down reform bill he introduced last fall.
"I don't think you can have a reconciliation of the issues that are on the table between now and then," said Paul A. Schosberg, president of America's Community Bankers.
Banking Committee Chairman Jim Leach said that the key sticking points are insurance and securities issues as well as the fate of the thrift charter. He acknowledged that the short deadline presents a steep challenge.
"It can be done," Rep. Leach said. "Whether it will be done, I don't know."
Lobbyists agreed that the thrift charter will be the toughest issue to resolve. Rep. Leach said proposed compromise language on the thrift charter issue that the Banking Committee floated earlier this month "appears to be gathering momentum."
Complicating matters is whether the House will attach legislation to override the Supreme Court's decision Wednesday that credit unions cannot expand beyond a single common bond.
"The preliminary consensus was to give that very serious consideration," Rep. Leach said. "The leadership was generally supportive of that possibility." u