Treasury Secretary Robert E. Rubin on Monday reiterated the Clinton administration's pledge to veto financial services reform legislation, which the Senate could take up today.

"We have said we would veto it in the form it now exists," Mr. Rubin said in response to questions during a Treasury Department news conference.

Mr. Rubin added that the administration's resolve remains unshaken even though the American Bankers Association, the Bankers Roundtable, and other former industry opponents have decided to back the pending Senate bill.

The administration has complained that both the House and Senate versions would unfairly bar direct operating subsidiaries of national banks-which are regulated by the Treasury's Office of the Comptroller of the Currency-from underwriting and other cutting-edge financial powers. Instead, broad powers would be granted solely to financial holding company units, which are regulated by the Federal Reserve Board.

"There is a very important public policy issue with respect to the involvement of elected administrations (in) bank regulation policy," Mr. Rubin said.

Senate consideration has been delayed while warring factions negotiate privately. Initial action on the bill, a procedural motion, is expected today. But that motion could not be voted on until Thursday because of Senate rules, buying extra time for dealmaking. There is less than two weeks left in this congressional session.

Sources said that lobbyists from the ABA and the Independent Insurance Agents of America met Monday to discuss possible changes to the Senate legislation's insurance selling rules. The agents' lobby reportedly wants to expand the 13 types of consumer protections-such as restrictions on deceptive advertising by banks about the safety of nondeposit products-that states may adopt.

The thrift industry also wants to eliminate restrictions on unitary thrift holding companies. An amendment is expected that would let commercial firms buy grandfathered unitaries. But Fed Chairman Alan Greenspan warned in a Sept. 25 letter to Senate Banking Committee leaders that the agency "strongly supports" the limits in the Senate bill.

Also, Republican Sens. Phil Gramm and Richard C. Shelby are still threatening to fight the bill because, they argue, it would expand regulatory enforcement powers under the Community Reinvestment Act. Sen. Jesse Helms, R-N.C., is supporting Sens. Gramm and Shelby.

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