The Lobbyists: Thrifts Lose, Small Banks Gain on Senate Panel

The new lineup of the Senate Banking Committee will boost community bankers' grassroots lobbying power at the expense of thrifts, according to industry lobbyists.

Four of the panel's new members hail from rural states with few thrifts: Wayne Allard, R-Colo., Chuck Hagel, R-Neb., Tim Johnson, D-S.D., and Michael Enzi, R-Wyo.

Peter Kravitz, lobbyist for the Independent Bankers Association of America, said small banks have a strong presence in all four states. "That's the case all through the Midwest where agriculture is king and you need banks to make farm loans."

In the four rural states newly represented on the panel, there are 724 banks and only 37 thrifts. Rhode Island, the other state recently represented on the panel, has only 6 savings institutions.

What's worse for thrifts, veterans Christopher S. Bond of Missouri and Patty Murray of Washington, whose states are home to 75 thrifts, are leaving the committee.

Robert R. Davis, director of government relations for America's Community Bankers, said the new lineup won't be a problem. The thrift trade group already has good relationships with Sens. Allard, Hagel, and Enzi, he said. "In states that don't have a lot of institutions, banks or thrifts, quality contacts make a lot of difference."

One big issue at stake: thrifts want Congress to preserve the right of commercial firms to own a single thrift as part of a new banking charter. However, the IBAA, many of whose members are small-town agricultural lenders, will fight any proposal to let commercial firms buy banks.

Although Senate Banking Committee Chairman Alfonse M. D'Amato has said he wants to break down the barriers between banking and commerce, resistance from the new members could block that initiative.

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House Banking Committee Chief Counsel Joseph L. Seidel last week ended roughly a year of speculation that he would jump to the private sector by accepting a partnership at Washington law firm Williams & Jensen.

Committee Chairman Jim Leach promoted deputy general counsel Gary Parker to replace Mr. Seidel. Mr. Parker, 38, has been a congressional staffer since 1985, first as legislative assistant to Rep. Leach, then for the past eight years as a banking committee staffer.

Mr. Parker is a graduate of Iowa State University and the University of Iowa College of Law.

A staffer for the committee since 1987, Mr. Seidel will take on securities and banking lobbying and regulatory work for Williams & Jensen, whose clients include First Union Corp. and CS First Boston.

"I've been here more than nine years and it seems like the time is right," said Mr. Seidel, 37. "There are very few people left on the committee staff from when I started."

In fact, only Chief of Staff Anthony F. Cole and Deputy Staff Director Joseph M. Ventrone have served the panel's Republicans longer.

Mr. Seidel was the lead Republican attorney on a fistful of important banking laws, including the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 and the Federal Deposit Insurance Corp. Improvement Act of 1991. During the last Congress, he was also the primary staffer for Rep. Leach's unsuccessful effort to repeal the Glass-Steagall Act.

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There's no shortage of financial industry trade groups, but law firm Hughes, Hubbard, & Reed is trying to launch another, the Electronic Commerce Forum. The association aims to recruit a cross-section of banking, securities, and other financial firms, said Mary Clare Fitzgerald, director of government relations at Hughes, Hubbard.

The group will lobby Congress and regulators on issues such as privacy and security in hopes of speeding the development of on-line commerce.

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