The House Financial Services Committee voted 39 to 29 on Thursday to approve a bill that would create a new consumer financial protection agency, clearing the first hurdle to enacting a key priority in the Obama administration's regulatory reform plan.

The bill would strip the federal banking and thrift agencies of their ability to write new consumer protection laws and give oversight of several existing statutes such as the Truth in Lending Act and the Home Mortgage Disclosure Act to the new agency. The legislation would restrict banking regulators' ability to enforce consumer protections and give states more latitude to write and enforce their own standards.

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