Kenneth Guenther, executive vice president of the Independent Bankers Association of America, blamed pressure from "libertarian Republicans" for Rep. Jim Leach's decision to accept mergers between banks and nonfinancial companies.
But Mr. Guenther isn't giving in. In a rare meeting with Newt Gingrich last week, he and Rossville (Ga.) Bank president Charles R. Lusk urged the House speaker to block legislation that allows banks and commercial firms to affiliate.
"Hopefully the Congress will realize the profound downside risk of the radical financial restructuring being proposed by Republican libertarians and Wall Street apologists," Mr. Guenther said in a statement.
Mr. Guenther said Rep. Leach, the House Banking Committee chairman, was "dragged kicking and screaming" to endorse limited cross-industry mergers after Rep. Richard Baker, R-La., and Rep. John Linder, the Georgian who heads the Republican Congressional Committee, worked to "undermine his position in the (banking) committee."
Rep. Gingrich reportedly told Mr. Guenther that the debate has not been settled. The speaker urged the IBAA to take its concerns to House Republican Conference Chairman John Boehner, who will head a GOP "working group" on financial modernization.
Also at the meeting, Rep. Gingrich promised that GOP leaders have made no decisions on expanding credit union membership, a move banks oppose.
Sen. Alfonse M. D'Amato told credit union executives that he supports a "broad membership policy" for the nonprofit financial institutions.
In a March 11 letter to the New York State Credit Union League, he predicted that the Supreme Court would overturn "unfair restrictions" imposed by a lower court barring credit unions from serving more than one employer group.
Also, Sen. D'Amato said he would "strongly oppose"' any efforts to strip credit unions of their tax-exempt status.
Sen. D'Amato also told the thrift industry a deal is a deal.
Fearing that creating a new charter could dilute their powers, thrift executives have been asking Congress to move ahead with merging the deposit insurance funds. But lawmakers last year promised bankers that there would be no fund merger without charter reform, and Sen. D'Amato told the New York Bankers Association nothing has changed.
"I understand some of my thrift friends think we are going to go back on that, and are now lobbying for us not to merge the charters," Sen. D'Amato said. "They're just whistling Dixie. We keep our promises. That is the law and we are going to follow through."
House Rules Committee Chairman Gerald B.H. Solomon seems to think banks are just jealous of credit unions.
"I say to banks if you want to be nonprofit and plow your income back into your depositors, then you can have a tax break too," Rep. Solomon told a National Association of Federal Credit Unions conference last week.
Rep. Solomon also took a swipe at a newspaper published in his home state. Responding to a recent editorial criticizing credit unions' tax- exempt status, The New York Republican said: "Do you know why The New York Times ran this? I wonder if it had to do with Citibank and all the other banks" with headquarters in New York City.
Reps. J.C. Watts, R-Okla., and Frank LoBiondo, R-N.J., have given up their Banking Committee duties after gaining seats on the House transportation panel.
Rep. Watts will take a leave of absence-meaning he can rejoin the banking panel. Rep. LoBiondo has quit the committee outright.
The two will be replaced by other GOP members, but no one has been named. Rep. Jon Fox, R-Pa., who also gained a spot on the Transportation Committee, is keeping his banking seat.
Much to the relief of banking regulators, Norman E. D'Amours is giving up his turn to head the Federal Financial Insitutions Examination Council.
The National Credit Union Administration chairman, who has been criticized by Congress for his leadership style, decided to decline the post because he's too busy.
"He respectfully declined because of his workload here," said Robert Loftus, the NCUA's director of public and congressional affairs. "With the Supreme Court case and legislative field of membership issues, it was more important that he concentrates here."
Comptroller of the Currency Eugene A. Ludwig will become the exam council's new chairman April 1.
The Justice Department's civil rights division has lost its number two Fair-Lending fighter. Kerry Alan Scanlon resigned this month as deputy assistant attorney general to begin a civil rights compliance practice in the Washington office of Kaye, Scholer, Fierman, Hays & Handler.
"This is the kind of practice where my background and experience will be helpful," said Mr. Scanlon, who previously worked for the NAACP Legal Defense and Education Fund and the Washington Lawyers Committee for Civil Rights and Urban Affairs.