Magazine article American Banker

California Senate Panel Votes for Compromise

Magazine article American Banker

California Senate Panel Votes for Compromise

Article excerpt

California Senate Panel Votes for Compromise

The first formal step has been taken here in passing compromise interstate banking legislation.

The state Senate Banking and Commerce Committee voted 6-2 Tuesday to approve a bill that would allow full interstate banking in California in 1991.

The measure reflects half of a compromise reached last week that would also allow regional banking in the West, including Texas, beginning July 1, 1987. A bill to accomplish that is pending in the California Assembly. Passage of both bills is expected.

The compromise bill now goes to the full Senate.

The next step is to amend the regional banking provisions in the bill pending in the Assembly.

Both houses must act on the bills before the end of the month, when the Legislature ends its two-year session.

The only opposition heard by the Senate committee came from Consumers Union and the Northern California Association for Nonprofit Housing.

Judith Bell of Consumers Union said, "Most or all the states that have passed interstate banking legislation have included provisions for loans for housing, economic development, or economic services.'

The bill approved by the Senate committee has no such provisions, which have generally been opposed by New York banks seeking to enter the California market.

Sylvia Martinez of the housing group decried the bill's failure to protect small savings and loans that make loans for low-income housing.

Sen. Rose Ann Vuich, an author of the bill, told both representatives that their concerns could be addressed in future legislation, but to do so now would upset the compromise.

Meanwhile, the Legislature, after a decade of debate, on Tuesday sent Gov. George Deukmejian a bill to allow banks and corporations to get out of the controversial unitary method of taxation. …

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