Magazine article Insight on the News

Gramm, Shelby Delay D'Amato Banking Proposal

Magazine article Insight on the News

Gramm, Shelby Delay D'Amato Banking Proposal

Article excerpt

The long-awaited banking-reform bill virtually collapsed in the Senate Banking Committee just before the congressional Labor Day recess. Chairman Alfonse D'Amato of New York announced that the "markup," or final agreement on the text of the bill, would be postponed for two weeks, but experts tell news alert! the bill is dead.

"We have not been able to resolve all of the differences," D'Amato said, but "we hope this can be done."

"I thought there was a reasonable chance of getting it out of committee," Bert Ely, a financial-services consultant in Alexandria, Va., told news alert/ "But now I think this delay is fatal. The bill is hung up on one issue which could force the bill to go to conference [between the House and Senate]. But it is an issue that the opposing factions say can't be compromised."

The proposed Financial Services Act, known as HR10, would have brought the most significant changes to the nation's financial institutions since the depression-era Glass Steagall and Bank Holding Company acts. For the first time in 60 years, banks would be able to get into businesses such as securities brokering and insurance. The recent mergers of financial institutions such as Citicorp and Travelers Group Inc. (worth $697.5 million) and Nationsbank/Bank of America (worth $524.7 million) are reflections of the way the financial markets have changed in 60 years.

A controversial balance of competing interest groups, HR10 passed the House of Representatives by one vote last May. …

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