WASHINGTON - The Senate Agriculture Committee approved legislation by voice vote Thursday that would exclude swap agreements and other over-the-counter derivatives from federal regulation.

Financial services industry officials praised the action and urged House and Senate leaders to swiftly approve the bill and its counterpart, which the House Agriculture Committee passed Tuesday.

"Enactment of those provisions will ensure that these transactions will continue to be enforceable in accordance with their terms, promote financial innovation, reduce systemic risk, and ensure that U.S. markets remain at the vanguard of financial innovation," said Marc E. Lackritz, president of the Securities Industry Association.

Controversy remains over other parts of the bill, such as whether to legalize single stock futures. And Senate Banking Committee Chairman Phil Gramm, a co-sponsor of the Senate bill, has concerns about changes in the details of the provision regarding swaps, his spokeswoman said. The House bill still has to pass through the Banking and Commerce committees.

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