Magazine article American Banker

Bankers' Stance Alienates Watt, A Potential Ally

Magazine article American Banker

Bankers' Stance Alienates Watt, A Potential Ally

Article excerpt

Byline: Stacy Kaper

WASHINGTON - Rep. Mel Watt, a potentially key ally in bankers' efforts to minimize the scope of a proposed consumer protection agency, blew up at industry representatives during a House Financial Services Committee hearing Wednesday, arguing that they were standing in the way while he tries to improve the bill.

The North Carolina Democrat, chairman of the monetary policy subcommittee, is still clearly weighing whether to support significant changes in the legislation, including weakening a provision that would eliminate preemption powers and allowing existing regulators to retain some enforcement power for consumer protections.

But he was also clearly fed up with the banking industry, accusing it of trying to kill the bill instead of working to improve it.

"Let me express in a public way what I have expressed to a number of your representatives privately, which is just the utmost sense of exasperation for the positions you have all taken on this which have really been: We are going to oppose it and oppose it and oppose it, and we are going to make all kinds of excuses for not doing this, and we are going to lay down in the road, and we are really not going to come in and sit down and talk about how to resolve the issues," Watt told Ed Yingling, the president and chief executive officer of the American Bankers Association. "There are some issues that I think need to be resolved, and I am just absolutely exasperated at the approach the industry has taken on this."

During the hearing, Yingling repeated the industry's concerns that a new consumer protection agency would target banks instead of nonbank mortgage lenders that he said created the housing crisis.

But Watt rejected Yingling's comments. "Even today you all are telling me, Mr. Yingling, that there is no real case for change here," Watt said. …

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