Action on Legislation
Glass Steagall/Regulatory Relief
Rep. Jim Leach
R-Iowa
House Banking Committee Chairman Jim Leach on Tuesday abandoned his yearlong effort to enact a sweeping financial modernization bill. Instead, he proposed a stripped-down version of his Glass-Steagall repeal and regulatory relief bills.
Rep. Leach conceded that he could not overcome widespread opposition to his bill, despite months of negotiations with the banking and insurance industries.
Under his new plan, regulators would have more authority to expand powers for bank holding companies, but banks would be prohibited from affiliating with securities firms or insurance companies.
To placate large banks pushing for new securities powers, Rep. Leach asked Federal Reserve Board Chairman Alan Greenspan to expand their underwriting activities through "section 20" affiliates.
Securities Regulation Reform
Rep. Jack Fields
R-Tex.
Bank holding companies would be freed from overlapping state and federal securities regulations under a bill approved by the House Commerce Committee on May 15. The measure, sponsored by Rep. Jack Fields, R-Tex., would replace some state securities regulations with a uniform set of federal laws.
The bill also would cut compliance costs for bank holding companies, which often issue stock to raise capital in more than one state and consequently are subjected to a patchwork of securities-registration laws. Senate Banking Committee Chairman Alfonse M. D'Amato has introduced a companion bill.
Bad Debt Recapture
Republican leaders on June 10 reached agreement to end a legislative logjam that has blocked $3 billion in tax breaks for thrifts. Sponsored by House Ways and Means Committee Chairman Bill Archer, the provisions have widespread support, but they are included as amendments to controversial health insurance legislation.
Both House and Senate bills protect thrifts from back taxes on bad debt reserves taken before 1988. The bills also make thrifts liable for $1.5 billion in taxes on reserves taken since Jan. 1, 1988, with the revenue used to pay for new health initiatives.
Republicans want to authorize medical savings accounts, but Democrats oppose the plan and the White House may veto it.
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New Legislation
ATM Fees
Sen. Alfonse M. D'Amato
R-N.Y.
Senate Banking Committee Chairman Alfonse M. D'Amato on May 23 introduced legislation banning ATM surcharges. Sen. D'Amato's effort follows previous moves by House Banking Committee members Charles Schumer, D-N.Y., and Bernard Sanders, Vermont independent.
Rep. Sanders' bill also would ban surcharges; Rep. Schumer's bill simply would require disclosure of all ATM fees at the time of a transaction.
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Pending Legislation
Thrift Fund Rescue
Bob Dole
Thrift lobbyists are holding out hope that lawmakers will move ahead with former Senate Majority Leader Robert Dole's plan to offset the cost of repealing a federal gasoline tax with revenue raised from capitalizing the Savings Association Insurance Fund.
Mr. Dole, who retired Tuesday, was the primary backer of the gas tax repeal.
In April, Mr. Dole introduced plans to use money raised from a special assessment on thrift deposits to cover budget revenue lost by repealing a 4.3 cents-per-gallon gas tax.
