As Congress considers letting industrial companies buy banks, corporate America has just one thing to say: Wake us up when it's over.
Of 10 major corporations contacted by American Banker, not one expressed interest in buying a bank. Industrial trade groups, meanwhile, said the issue is a low priority, at best. And analysts who follow some of the possible acquirers see little reason for such deals.
Even industrial companies active in financial services are shrugging off queries about their interest in bank acquisitions.
"We already have what we need without all the regulatory hassles of owning a bank," said Mary Horne, a spokeswoman for the huge GE Capital Services.
The widespread disinterest contrasts sharply with the issue's urgency on Capitol Hill. The idea of letting banks and nonfinancial companies buy one another has emerged as a central, and highly contentious, part of financial "modernization."
Proponents have argued that the current prohibition jars with the principles of a free-market economy. Others, however, said that these mergers would produce dangerously large conglomerates and conflicts of interest between lenders and affiliates.
Rep. Jim Leach, chairman of the House Banking Committee, has gone so far as to warn that giant corporations may "gobble up" banks if the current restriction is lifted. Companies like Exxon and General Motors, he has said, could easily swallow Citibank, Chase Manhattan, or another large banking company.
The arguments, however, seem largely theoretical.
This newspaper's spot survey-which included companies ranging from Exxon to Coca-Cola to Bell Atlantic-suggested that corporate America sees almost nothing to gain from owning banks.
Some companies simply aren't interested in offering financial services. And those that are see cheaper and easier approaches than buying banks.
Take AT&T Corp., for example. To issue its popular Universal credit card, the telecommunications giant operates a credit card bank, a thrift, and a Utah industrial loan company-none of which are subject to the tough Federal Reserve oversight faced by bank holding companies.
"We have sufficient flexibility," said company spokesman Mitchell Montagna.
Corporate lobbyists seem equally uninterested.
Martin Regalia, chief economist at the U.S. Chamber of Commerce, said financial modernization has not been discussed at his group's government affairs meetings in three years.
Kimberly Pinter, director of corporate finance and tax legislation for the National Association of Manufacturers, said she was "vaguely aware" of the legislative efforts but had received no orders to weigh in on behalf of her group.
How could there be such a large gap between the policy debate and the views of the potential beneficiaries?
To some, it's typical of Washington. Banking legislation often gets bogged down in rhetorical disputes that have little practical impact, said Peter J. Wallison, a lawyer in the Gibson, Dunn, and Crutcher firm and a former Treasury Department general counsel.
"No matter how heated the debate gets in Washington, there is really no effect on the lives, finances, employment, or well-being of the people of the United States," he said.
Others suggested that policymakers are ahead of corporate chieftains in thinking through the implications. If that is right, the expressions of uninterest are unlikely to last.
"If it's not on their radar screen now, merging commerce and banking opens new options," said Kenneth Guenther, executive vice president of the Independent Bankers Association of America. "Any alert management has to be open to new options."
Added Rep. Leach: "It's inconceivable that consolidation would not immediately commence if legislation passed mixing commerce and banking."
Telephone companies, with their natural reach into the lives of consumers, are often cited as likely potential acquirers of banks. But Bell Atlantic, Bell South, and Pacific Telesis each said it isn't interested.
Perhaps the most frequently mentioned name of all is Microsoft Corp., a central player in the explosive field of home banking. But Microsoft just wants to sell software to financial firms and isn't interested in acquiring Chase Manhattan or any other bank, said Natwest Securities Corp. analyst Kevin A. McCarthy.
"The Justice Department breaths down their back every time they make a move," Mr. McCarthy said. "For them to go into a more heavily regulated industry like banking is crazy."
With or without the support of industry, the movement to break down the barrier between banking and commerce is clearly gaining. Resistance in the House is eroding, and the Clinton administration is poised to throw its support behind the idea.
"More and more, the competitive lines are beginning to blur, and we shouldn't stick to these irrational distinctions," said Treasury Under Secretary John D. Hawke Jr.
He noted that commercial companies had been allowed for years to own a single thrift-with no ill effects. Among companies that have bought thrifts are: Temple Inland Inc., a lumber and paper company in Diboll, Tex.; Hi-Vee Food Stores Inc., West Des Moines; and Bloomfield, Mich.-based PHM Corp., owner of Pulte Homes.
But concerns linger. Rep. Leach pointed to Japan and Germany where, in his view, commercial ownership of banks has led to tight credit for small firms and clear conflicts of interest.
"There would be no national interest in the 'Keiretsu-ization' of the economy," he said.
