Academic journal article ABA Banking Journal

One More Time: With BIF-SAIF Behind Him, House Banking Chief Jim Leach Has High Hopes for a Bank Modernization

Academic journal article ABA Banking Journal

One More Time: With BIF-SAIF Behind Him, House Banking Chief Jim Leach Has High Hopes for a Bank Modernization

Article excerpt

With BIF-SAIF behind him, House Banking chief Jim Leach has high hopes for a bank modernization law

That bankers are "numbers types" goes without saying, but whether their ranks include many numerologists is unknown.

Yet even ordinary folks consider certain numbers to be good signs--like "3" (as in, "three's the charm") and "21." Bankers who want to see modernization legislation go through may take to heart the following: Jim Leach, returning chairman of the House Banking and Financial Services Committee, is in his 21st year on the committee; he's also starting his third year as committee chairman.

And, just for good measure, numbers-wise, if you consider that the Iowa Republican's modernization legislation was tried two different ways last Congress, H.R. 10, Leach's Financial Services Competitiveness Act, could make it through in this Congress.

For reasons he explains in the following interview, Leach is quite upbeat on the chances for his legislation. But there are two other numbers Leach must watch out for: 1 and 9. The '1" is House Speaker Newt Gingrich, bruised but back after ethics inquiries. Leach was one of 9 members of Congress to oppose Gingrich's re-election as Speaker. While no immediate retribution was apparent, it is an open question whether banking modernization, prone to bogging down, will suffer any ill effects from the matter.

Leach, asked about this, acknowledges that the future is hazy. "I knew [ took a great risk," he says. "When I took it I assumed I would lose my chairmanship." He didn't, obviously, but that doesn't mean the ride will be fun. Leach was the most prominent of those opposing Gingrich's re-election.

On the other hand, if there is anything at all to numerology, one might point out that "1" and "9" add up to "10"--as in H,R. 10, Leach's bill. So much for an analysis of legislation by the numbers.


Jim Leach is known for several underlying stances on banking: being a stickler for capital, very community-bank oriented, and, in sharp contrast to his predecessor, Henry Gonzalez, being a strong backer of the Federal Reserve Board. The 54-yearold chairman met with ABA Banking Journal in late January. The dialog that follows has been edited for length, and, in cases, for clarity.

BJ: Last Congress was your first experience as committee chairman. What did you learn that you can use going forward? Leach: The last Congress was very divisive. There was a lot of byplay.

Some was related to the jurisdiction of the committee. For instance, one of our issues was Whitewater, an awkward moment for the committee. I thought the information placed on the table was significant and it led to at least 24 criminal convictions.

But the first issue, in many ways, for the committee was the Mexican issue. We were asked to put together a program for Mexico, which we did. We found that neither the House nor the Senate was really determined to take on that controversy and we laid out a fallback [executive branch] position, which the Administration accepted.

The approach that we developed in concert with the Administration is one of the most successful approaches ever developed by the government for an economic kind of challenge. And it led to a half a billion dollar profit for the taxpayer.

There were some prospects of an implosion in Mexico, which would not have been good for the American economy. Mexico regaining ground is important to the United States. I consider it much more significant than anything else we did.

We also passed a significant bill that relates to the BIF-SAIF dilemma.

With regard to Glass-Steagall reform, I was disappointed that we could not reach a resolution, but I don't think there's anyone who doesn't acknowledge that the dialogue was advanced rather dramatically. The prospects for change this year are very high. I'm very hopeful that this year it can be done. …

Search by... Author
Show... All Results Primary Sources Peer-reviewed


An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.