Magazine article American Banker

Leach Warns Banks He'll Move Glass-Steagall Bill without Them

Magazine article American Banker

Leach Warns Banks He'll Move Glass-Steagall Bill without Them

Article excerpt

WASHINGTON Rep. Jim Leach criticized a group of big banks for locking themselves into an "impractical" position on insurance powers and said he's ready to move his Glass-Steagall bill without their consent.

The House Banking Committee chairman appears to have lost patience with the negotiations that his staff has been conducting with the Bankers Roundtable and a variety of insurance interests. His latest comments could increase pressure on the Roundtable to compromise with the insurance industry.

"Clearly, Leach is saying that some institutions are asking for everything, and legislation just doesn't work that way," said Kenneth Guenther, executive vice president of the Independent Bankers Association of America.

Alfred M. Pollard, the Roundtable's legislative director, said his group takes Rep. Leach's warning seriously, but argued that his members must protect their interests. "The pressure I feel is the pressure that's been there all along. We're trying to come up with something that will work. We made a commitment to produce something that our members will support," he said.

Rep. Leach did not identify the banks he believes have taken an impractical position, but a group of institutions - including Florida's Barnett Banks Inc. and Ohio's Banc One Corp. - have been pressing for protection from state insurance regulators. The industry also opposes a provision that would set a moratorium on new insurance powers for national banks.

In a Dec. 28 letter to the Roundtable's head, Chase Manhattan Corp. chairman Thomas G. Labrecque, Rep. Leach said that the remaining disagreements may be impossible to reconcile and that there is "no advantage in lengthy further delay."

Rep. Leach said he will ask House Speaker Newt Gingrich to allow the Glass-Steagall bill to come the floor for a vote as soon as Congress and the White House resolve their budget dispute. …

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