WASHINGTON - Rep. Jim Leach of Iowa, the ranking Republican on the House Banking Committee, has sharply criticized the administration's plan to consolidate the federal banking agencies, saying it would politicize the regulatory process.
"A single, presidentially controlled regulator simply puts too much power in the hands of any incumbent administration," he said in a speech to the institute of International Bankers
Rep. Leach said the resulting "presidentialization" of authority raised the prospect of presidential money managers "demanding political contributions from large institutions with the implication that regulatory decisions could be affected."
Earlier State Fees?
Rep. Leach also suggested that the administration's proposal to consolidate regulatory authority in a single agency might increase the fees paid by state-chartered banks.
While stressing that he does not favor the concept of a single regulator, Rep. Leach said it would be better to vest authority in the Federal Reserve rather than create the type of new agency the administration has proposed.
The Fed has unique regulatory and supervisory expertise spread across the whole spectrum of the banking industry," he said. In addition, he added, the central bank has an established tradition of independence.