Bank lobbyist Phil Corwin found himself in an uncomfortable position last week: on national TV criticizing a big-time Democratic Party fund- raiser.
A guest on ABC's "Nightline" Wednesday, Mr. Corwin was interviewed about a $10,000-a-plate dinner held last September at the home of William Brandt, the new head of Mercury Finance Co. and a friend of President Clinton's.
Mr. Brandt targeted bankruptcy lawyers by touting the attendance at the fund-raiser of Brady Williamson, head of the National Bankruptcy Review Commission, chartered by Congress last year to investigate reform.
Mr. Corwin is an independent lobbyist but was employed by the American Bankers Association when Mr. Brandt repeatedly asked him to attend. When Mr. Corwin declined, he said Mr. Brandt told him the banking industry should not expect to achieve its bankruptcy reform goals by just working with "your Republican friends in Congress."
In a letter to Sen. Charles Grassley, R-Iowa, who is investigating the fund-raiser, Mr. Corwin said he told Mr. Brandt that the ABA could not buy any tickets for the dinner but that many banks had given money to the Democratic National Committee. Mr. Brandt, according to Mr. Corwin's letter, responded: "The banks haven't given enough."
After Treasury Under Secretary John D. Hawke Jr. told a group of international bankers last week that the wall between banking and commerce should be torn down, his predecessor disagreed.
"I see no proven example of it working or any reason to do it," Frank N. Newman said. But if policymakers ignore his opinion, the Bankers Trust New York Corp. chief executive joked: "I'd love to buy Procter & Gamble."
The consumer products company sued Bankers Trust over two derivatives contracts that soured when interest rates rose in early 1994. Bankers Trust settled the case last year at a cost of $145 million.
Seems the party line spelled out by Mr. Hawke last week hasn't trickled down to Comptroller of the Currency Eugene A. Ludwig yet.
At a House Banking subcommittee hearing on financial modernization last week, Mr. Ludwig said he wasn't sure how banking and commerce should be mixed.
"I have not settled on a line here," Mr. Ludwig said. Banning such affiliations "is way too strong, but a free-for-all is a bad idea," he said.
The Comptroller's Office is a bureau of the Treasury Department.
Sen. Lauch Faircloth, who chairs Senate Banking's financial institutions subcommittee, plans to introduce legislation to reform the Federal Home Loan Bank System.
Speaking to America's Community Bankers' government affairs conference last week, the North Carolina Republican said his bill would make membership in the system voluntary, even for thrifts.
It would also eliminate the cap on advances to commercial banks and reallocate the $300 million annual tab paid by the 12 Home Loan banks on Refinancing Corp. bonds.
Sen. Faircloth's proposal is less ambitious than a bill introduced by Rep. Richard Baker, R-La., which would allow Home Loan banks to make advances for community and economic development lending.