Hoping to kill opposition by giving something to all sides, Republicans on the House Banking Committee agreed Thursday to tackle a massive banking bill.
The legislation would give the banking industry Glass-Steagall repeal and regulatory relief and deliver a healthy insurance fund to the thrift industry and the Clinton administration.
The bill also would merge the bank and thrift charters and block the Comptroller of the Currency from giving national banks broader insurance or securities powers.
"It is our consensus that each part leverages the others," House Banking Committee Chairman Jim Leach said.
Rep. Marge Roukema, R-N.J., predicted the bill would let Congress approve recapitalization of the Savings Association Insurance Fund quickly. "Time is of the essence," she said.
But one source doubted that the American Bankers Association would drop its opposition to the thrift fund fix because it would force banks to pay $600 million annually to help pay off thrift bailout bonds.
An industry source also doubted that Senate Banking Committee Chairman Alfonse M. D'Amato would accept the unusual package. "The Senate Banking Committee appears to be on a different track than the omnibus bill as proposed by Chairman Leach," the source said. "It's going to be very difficult to get this through the Senate."
Rep. Leach said he would suggest his package to House Speaker Newt Gingrich and other Republican leaders when he meets them next Wednesday.
If they are unwilling to bring the combined bill to the floor, Rep. Leach would offer to attach the thrift fund fix and charter merger to a debt ceiling increase that must be approved by next Friday.
The committee's decision caught administration officials and industry lobbyists by surprise.
As part of the combined bill, Republicans on the House panel also agreed to block two recent efforts by the Comptroller of the Currency to expand bank powers.
One, the so-called Magna decision, allowed Magna Bank of Missouri to retain insurance offices in towns with more than 5,000 people when it converted from a state to a federal charter. National banks are generally prohibited from selling insurance from larger-sized towns.
The bill also would stop the Comptroller's Office from proceeding with a proposal to let national banks offer new products and services as long as they are delivered through subsidiaries.