The chairman of the House Banking Committee told securities industry representatives today that he plans to conduct a full-scale review of the nation's financial services industry next year.
Rep. Fernand St Germain (D-R.I.) made the announcement today before the annual meeting of the Securities Industry Association as a series of federal and industry officials expressed differing views on whether Congress will act next year on the Glass-Steagall Act and other pillars of federal finance regulation. The Glass-Steagall Act keeps banks out of the securities business by barring them from most kinds of securities underwriting.
St Germain was unwilling to commit himself to consideration of major legislation next year, however.
On the other hand, Sens. John Heinz (R-Pa.) and Donald W. Riegle Jr. (D-Mich.), two members of the Senate Banking Committee, suggested that 1983 could be a landmark year for financial services legislation. In particular, Heinz said there will be "pressure to act on a legislative package as early as" April 1.
Further muddying the prospects for major legislation next year are discussions by top Reagan administration officials, regulators, and industry executives over the possiblity of the establishment of a blue ribbon federal panel to study the same situation, a move likely to further delay consideration of an omnibus financial services bill.
Even within the SIA, there are doubts about whether the increasingly diverse securities industry can unite to attack major legislation altering the structure of the brokerage business.
In particular, it is also unclear whether the mergers of large brokerage firms into insurance companies and other conglomerates will permit the SIA to maintain a cohesive legislative voice.
Robert Linton, newly installed SIA chairman and also chairman of Drexel Burnham Lambert Inc., said in remarks today that Congress "must be made to recognize the threat to our basic system posed by the specter of a handful of giant financial conglomerates dominating the scene.