Bank holding companies would be freed from overlapping state and federal securities regulations under a bill approved by the House Commerce Committee Wednesday.
The measure would replace some state securities regulations with a uniform set of federal laws.
For example, most state reporting requirements for broker-dealers would be preempted by a single federal requirement. The bill also would cut compliance costs for bank holding companies, which often issue stock to raise capital in more than one state and are consequently subjected to a patchwork of securities registration laws.
"This is a reg relief bill for the securities industry, but because banks issue stock and have broker-dealers, this will also lessen regulatory burden for us," said Sarah Miller, general counsel for the ABA's Securities Association.
The legislation also would loosen the restrictions faced by lenders who extend credit to their customers to buy securities.
Senate Banking Committee Chairman Alfonse M. D'Amato, R-N.Y. is preparing a companion bill, which may be introduced as early as today.