Magazine article American Banker

Branching Advocates Gain as Dodd Drops Amendment

Magazine article American Banker

Branching Advocates Gain as Dodd Drops Amendment

Article excerpt

WASHINGTON -- Advocates of interstate branching scored a major breakthrough last week, but they are by no means home free.

Since 1991, when interstate was first taken up in earnest by Congress, the main stumbling block has been the insurance lobby's effort to link the measure to limits on bank powers. With the two issues entangled, legislation became gridlocked.

On Thursday, however, Sen. Christopher J. Dodd, D-Conn., announced he was dropping his effort to attach insurance language to interstate legislation that the Senate Banking Committee is scheduled to take up on Feb. 23.

Sen. Dodd is the insurance industry's prime ally on this issue, and he had been expected to prevail in the Senate. As a result, most observers assumed interstate was dead for the year.

Concerns Remain

Still, other roadblocks loom.

Of greatest concern to bankers is the possibility that consumer groups will succeed in attaching amendments that mandate new services to low-income consumers.

"We are quite firm," said Edward L. Yingling, chief lobbyist for the American Bankers Association. "If there are any negative amendments, we will do everything we can do to kill the bill."

Mr. Yingling believes he can make good on his threat. In fact, he said, it was primarily his organization's efforts that led Sen. Dodd to withdraw his insurance amendment.

"What happened was, we worked that issue very hard," he said. "I know we were picking up votes."

Interstate also must survive a possible split in the banking industry on the issue. …

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