WASHINGTON - The call for financial reform and
for new banking industry powers has echoed through the halls of
Congress for the last four years. And every year, the predictions
of major new legislation have gone unfulfilled.
This time, the predictions may well come true.
The catalysts for a series of legislative reforms in the 100th
Congress, according to lawmakers, lobbyists and banking regulators,
are worries about the integrity of the nation's securities markets
raised by the Ivan F. Boesky insider-trading scandal, pent-up demand
for big changes in allowable banking services and the precarious
condition of the government's fund that insures deposits at the
nation's thrift institutions.
They add that with the rise to am Proxmire as head of the
banking committee, the two congressional chambers should be able to
avoid some of the bitter disputes that were characteristic of the
last four years, when new legislation died for lack of a consensus.
``For too many years, the courts, regulators and state
legislatures have made all the decisions on restructuring the
financial system,'' Proxmire said. ``But if the system is to be
changed or preserved, only the Congress should make those
``I think this is the year for major financial legislation,''
said Rep. Charles E. Schumer, the Brooklyn Democrat. ``Too much has
happened in the industry to keep the status quo.''
Schumer and others predict that Congress will pass a series of
banking laws, including a financial rescue of the Federal Savings
and Loan Insurance Corp.; a ban on limited-service banks; the
granting of new underwriting powers for banks, and a requirement
that banks clear checks much faster than they do now.
``Some of the most outrageous and scandalous behavior in the
history of our securities and banking systems has occurred during
the past several years,'' said John D. Dingell, the Michigan
Democrat who is chairman of the House Energy and Commerce Committee.
``Obviously, the time has come to improve enforcement of our
existing laws and to revise some of those laws to address the sorts
of knavery and thievery we have seen.''
Even so, the outlook for new laws limiting corporate takeovers
is uncertain. Though Boesky's $100 million settlement with the
Securities and Exchange Commission highlighted to many lawmakers a
takeover trend gone wild, there is nothing near a consensus on
passing restrictive securities laws, legislative experts say. …