As time was running out Wednesday for lawmakers to reach a financial reform compromise, industry lobbyists were scratching their heads to figure out what is in the deal-or whether there really is one.
The House Banking and Commerce committees were still working furiously early Wednesday afternoon to meet the March 4 deadline that House Speaker Newt Gingrich set last week. Republican leaders want a bill that would merge the banking, insurance, and securities industries to reach the floor by April 2.
Rep. Gingrich met with Republican leaders and committee heads later in the afternoon to determine whether a compromise had been reached.
"The outstanding issues are largely resolved," House Banking Committee Chairman Jim Leach said through a spokesman afterward. "The next step will be some consultations with Democrats."
Rep. John J. LaFalce, the Banking Committee's ranking minority member, complained earlier in the day that Democrats had been shut out of negotiations.
"It will be very difficult to move to the House floor any financial modernization legislation that does not have broad bipartisan support," the New York congressman said.
Details remained scarce on how the two committees plan to break their four-month deadlock, but a compromise on the thrift charter is reportedly near, while disputes remain over securities and insurance issues as well as bank subsidiary powers.
Edward L. Yingling, chief lobbyist for the American Bankers Association, said the committees appeared to be "the closest they have ever been" to a compromise, but that too many questions remain unanswered to lay odds on chances for success.
Official signals were mixed.
"They are still working with the notion that they are going to finish this," a spokesman for House Republican Conference Chairman John A. Boehner said.
"We will have to see how things go whether we can go forward to the floor or not," a Banking Committee spokesman said. "Certainly we have advanced things from last week."
Banking Committee member Rep. H. Richard Baker, R-La., said that the committees had narrowed their differences considerably but that "extremely difficult" issues remained. For instance, determining regulatory turf for hybrid financial instruments-whether they should be overseen by banking, insurance, or securities regulators-remains undone.
Speaking at the annual government affairs conference of America's Community Bankers, Rep. Baker warned that the thrift industry may not like the compromise on the fate of their charter. The Banking Committee has proposed preserving the thrift charter but limiting its powers.
Thrift leaders said that the proposal is a backdoor attempt to gut the thrift charter and that they remained staunchly opposed to surrendering any powers.
"Instead of putting a gun to your head and killing you, it stabs you and lets you bleed to death over the next three years," said James R. Turner, president of Heartland Community Bankers Association in Topeka, Kan.
Other lobbyists were upbeat about other parts of the bill.
David J. Pratt, senior vice president of federal affairs for the American Association of Insurance, said he was confident a compromise was very close and that a bill could pass the House in early April.
"It is coming together well," he said. Insurance companies are pleased with provisions they expect will let state insurance regulators challenge decisions by bank regulators in federal appeals court, he said.
Whether the banking industry will agree to that provision-which would eliminate a historic legal advantage for the Office of the Comptroller of the Currency-is unclear, Mr. Yingling said.
Comptroller of the Currency Eugene A. Ludwig said Wednesday at the Independent Bankers Association of America conference in Hawaii that he is pessimistic that any bill will benefit banks. "What we have been seeing is not going to be good for anyone."
Other political issues could interfere, too. Banks and credit unions fear that Republican leaders may add legislation to expand credit union membership to the reform bill-killing both.