WASHINGTON - The Republican "Contract with America" has some industry representatives wondering if House GOP members are using an axe to trim regulations that could best be handled with a scalpel.

The industry is particularly alarmed over a bill, on the House floor at the end of last week, that would freeze action on regulations issued since Nov. 20, while blocking issuance of new rules through the end of the year.

As originally drafted, The Regulatory Transition Act would have had the apparently unintended effect of placing a freeze on rules issued by banking regulators to protect deposit insurance funds and ensure safety and soundness.

But at the request of members from both sides of the aisle in the House Banking Committee, the bill was amended to exempt these rules.

Nonetheless, a raft of other banking regulations could be affected, and some industry representatives are scratching their heads as to what this means for banks.

"Banking regulation is so different from everything else," said James McLaughlin, director of agency relations for the American Bankers Association. "Banks have got to go to regulators for everything they do.

"To place any restrictions on bank regulators with broad-brush measures like this could have some effects that are not recognized at first blush."

Regulations aimed at overhauling the Community Reinvestment Act could be among the first affected. New rules are expected to become final in March. But industry sources predicted that enactment of the regulatory moratorium would put the rules on hold.

An Office of Thrift Supervision rule finalized in November that ended annual independent audits for OTS-regulated institutions of $500 million or less could be put on hold as well, said Marti Sworobuck of America's Community Bankers.

"This could have the unintended consequence of reversing a decision that had removed a burden from the industry," Ms. Sworobuck said.

One rule that apparently is safe is the bank industry's promised insurance premium reduction. The Banking Committee was able to persuade House leaders to exempt the premium rule.

Still, Debbie Shannon, a lobbyist for the American Bankers Association, said the trade group spent some time working on the BIF language.

"We submitted some suggested report language that clarifies the bill to exempt reductions in assessments and fees," Ms. Shannon said, referring to the explanatory materials that accompany bills. "We wanted to tighten it up just to make sure."

Part of the uncertainty is caused by the pace at which HR 450 has moved through the House. The measure breezed through a Government Reform and Oversight subcommittee and full committee vote to reach the House floor in three weeks. As a result, there has been little time for lobbyists or lawmakers to consider all of the bill's far-reaching effects.

"It's unbelievable," groused a Democratic House Banking aide, criticizing the Republican majority. "It's very scary - this is major stuff they are doing, and it's all going too damn fast."

This is exacerbated by trade groups' caution in voicing their concerns too loudly. Some are reluctant to appear to nay-say the contract.

"We're just crossing our fingers and trying to figure out what the punishment would be if we had the nerve to speak up about some of the specific problems this will create," said one industry source.

However, Kenneth A. Guenther, executive vice president of the Independent Bankers Association of America, said concerns about the moratorium are overblown.

"The industry is so healthy that a six-month moratorium isn't going to hurt it," Mr. Guenther said. "I think that this is an important signal to pass to the regulatory industry that is Washington."

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