[Congressional Record Volume 144, Number 60 (Wednesday, May 13, 1998)]
[House]
[Pages H3201-H3222]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




               FINANCIAL SERVICES COMPETITION ACT OF 1997

  The CHAIRMAN. The Committee will resume its sitting.
  Mr. LaFALCE. Madam Chairman, I yield 1\1/2\ minutes to the gentleman 
from North Carolina (Mr. Watt).
  Mr. WATT of North Carolina. Madam Chairman, it surprises a number of 
my colleagues on the Committee on Banking and Financial Services that 
the gentleman from Louisiana (Mr. Baker) and I are quite often on the 
same side of financial services issues. But I have got to jump ship on 
him today when he starts trying to do away with CRA for small banks. 
Sixty-four percent of the banks in this country, in fact, would be 
exempted under this amendment. I cannot go there with him.
  The CRA requirements for small banks, those under $250 million in 
assets, were already streamlined in 1995. I am not sure what it is we 
are responding to with this proposed amendment, because in February of 
1996, the American Banker headlines said, ``Small banks give thumbs up 
to streamlined CRA exams.''
  They are not complaining. Who is it that we are trying to protect? 
This is an amendment in search of a problem to solve. And I am not sure 
why we are trying to solve a problem in the midst of this bill that has 
a bunch of problems in it for people who do not even perceive that they 
have a problem.
  CRA has served a very important purpose in our communities. The 
gentleman from Utah (Mr. Cook) is absolutely wrong in his assessment 
that the purpose of CRA is for community people. It is not an 
affirmative action program. It is for small businesses, small farmers, 
people who live in the communities. It has got nothing to do with 
affirmative action. We ought to all be supporting CRA rather than 
trying to abolish it.
  I think we ought to oppose this amendment even though there are some 
other aspects to it that might be valuable.
  Mr. BAKER. Madam Chairman, I yield myself such time as I may consume.
  Madam Chairman, in 1950, the average American family had 50 percent 
of their assets in a bank. Today, that percentage is 17 percent. And in 
the corporate arena, it is even worse.
  For many years, the banks were the only place in town where moderate- 
to large-size businesses could get credit to grow or expand. And from 
perhaps 80 percent of corporate lending, we now find that banks provide 
less than 20. And it is not only just that markets are changing. New 
products are being created.
  In 1980, there were 266 mutual funds in this country. Today there are 
over 2,600. As the stock market continues to surge ahead to 
unparalleled record highs, investors are not worried about deposit 
insurance; they are worried if they are going to miss out on the next 
25 percent rate of return.
  The creation of money market funds, a nonbank product, allowing 
people to put their money in a perceived safe location and earn 
interest on their checking accounts, again, more disintermediation, 
more money flowing out of the banks into nontraditional sources.
  So many banks in the marketplace are surging ahead with these new 
mergers because this gives them a way to keep the profitability up as 
they spread fixed operating cost over larger and larger and larger 
customer bases. It makes good sense for the large institutions. It is 
reported that the NationsBank merger, for that institution alone, will 
result in annual savings in excess of $2 billion. Phenomenal savings 
are occurring through these efficiencies in the marketplace.
  Now, the question becomes, how does the typical $47 million bank in 
America, the 6600 subject of the CRA amendment, see any benefit from 
any of this? Is there any provision that we can point to in this bill 
that we can go back to hometown XYZ in our State and say, this is going 
to help make us more profitable, it is going to relieve us of 
regulatory burden, it is going to give us an opportunity to grow and 
prosper?
  Sure, if they are a billion-dollar institution with branches in 
multiple States, maybe who has even acquired a recent insurance company 
in spite of Federal prohibitions to the contrary, they might see 
tremendous potential in diversification and opportunities, particularly 
if H.R. 10, as currently constituted, is passed.
  But for the average consumer who goes home today and uses their ATM 
machine, if they have them in their community, who is complaining about

[[Page H3202]]

those fee increases, who bitterly hates the new charges for all the 
service the banks are providing, those banks are desperate. They are 
looking for ways to get new revenue streams. Because it is a historical 
fact, interest on loans is in decline and the real growth market is in 
the fee business and trying to find new products.
  Again, that is not a significant problem to a competent management 
team who has diverse interests. But to the hometown bank, walk in a 
hometown bank, the the president and vice president are not only the 
loan officer, not only the fellow who locks the door, there are 
probably two tellers at the window, they are the CRA compliance 
department. They are the OCC compliance department. They put up with 
the audit from the FDIC or the Federal Reserve. They are doing it all.
  Make no mistake, this amendment is a great deal more than just 
limiting the load of CRA and its financial obligations on small town 
institutions. It is, in fact, the product of the Committee on Banking 
and Financial Services on restructuring how a bank can sell new 
products.
  There is nothing insidious about the words ``operating subsidiary.'' 
It is a way of doing business. And quite to the contrary opinion of the 
Federal Reserve, the Secretary of the Treasury, I am told, will urge a 
veto of this legislation because we do not allow operating subsidiaries 
to be engaged, in the base text of H.R. 10, as envisioned by the 
administration.
  I would also point out, for those who are scared of the new world of 
commerce and finance, of all the megamergers and the banks gobbling one 
another and perhaps the giant of all, Microsoft, one day finding a way 
to enter the financial marketplace, guess what? The unitary thrift is 
alive and well if this bill passes. And even worse, it is bigger than 
ever if this bill fails.
  And there is no restraint, no other amendment, no limiting factor. 
There are approximately 800 unitaries that have been in the marketplace 
quite successfully. They own over 62 percent of all thrift assets in 
the country. They are enormously successful. Look down the application 
line.
  Why, even in Louisiana, we have got my Farm Bureau and 26 more who 
are joining together on March 9 to apply for a unitary thrift charter. 
Do my colleagues think they just want to make farm loans? I think they 
have got other plans.
  Now, all of these applications, unless there is something just 
basically deficient with the applicant, will be approved. It could be 
1,500, it could be 2,000 of these new commercial enterprises that own 
thrifts. Under the bill, there is no prohibition about selling these 
entities to Microsoft or to General Motors or any of the other horror 
stories we have heard time after time after time as we concern 
ourselves about where our financial markets are going. This amendment 
would prohibit those sales. It would keep the Microsofts from buying 
unitary thrifts.
  This amendment is a lot more than just CRA operating subsidiaries and 
closing down thrifts. It is an amendment that does important insurance 
reform. If they want to get into the insurance business in this bill, 
as a bank, they have to buy an existing insurance agency that has been 
in business for 2 years.
  What if they are in a town that does not have an existing insurance 
agency that has been in business for 2 years? This amendment allows 
them to petition the State insurance commissioner to certify there is 
no competition in the community and allows them then to enter into the 
insurance business, a small-town, small-bank provision.
  Sure, I know financial modernization is an absolute necessity and 
frankly will proceed whether this Congress or the regulators 
notwithstanding choose to take a position that moves the marketplace 
forward. Bright people are going to find a way to get around the law, 
the Congress notwithstanding. But we can facilitate it. We can make it 
less expensive.
  For the past 50 years, this Congress has taken the pasture of 
financial services and fenced it off; and what we decide is some people 
get 10 acres, some people get 30, some people get the really pretty 
waterfront property in the fertile valley, others get the rocks.
  Now, whether they have 10 acres in the rocks or 30 acres on the 
waterfront has depended on how successful their lobbying effort is. 
That ought not to be the case. We ought to take down the fence lines. 
We ought to let them roam wherever they choose and eat as much grass as 
they want. But if they get sick, do not come back to us.
  This proposal does not allow for that innovation. This proposal makes 
it difficult for small banks to be innovative, to sell new products, to 
use that dreaded operating subsidiary, to reach out to their consumers 
and provide them competitive products at competitive prices in small 
towns across this country. This amendment speaks to that point.
  I understand the differences that some Members may have with the 
philosophy of this amendment. I understand that the Federal Reserve and 
the OCC fight each other for regulatory turf. I understand there are a 
lot of reasons for people to be opposed to this amendment. But I can 
honestly tell my colleagues, the sole motivation for seeing it included 
in H.R. 10 is to give hope back to the small community banks across 
this great Nation.
  Mr. GILLMOR. Madam Chairman, I yield 2\1/2\ minutes to the gentleman 
from Ohio (Mr. Oxley).
  (Mr. OXLEY asked and was given permission to revise and extend his 
remarks.)
  Mr. OXLEY. Madam Chairman, let me first of all say that it has been 
an excellent debate. I have great respect for the gentleman from 
Louisiana, as he well knows, and he certainly has expressed his 
position exceptionally forcefully and well to this body.
  Frankly, I have some empathy for his position, particularly on some 
CRA relief versus small banks. But I really do have major concerns with 
how this particular amendment treats insurance sales in banks. As I had 
indicated earlier during the debate on the LaFalce amendment, this 
issue, the bank sales of insurance, has bedeviled this Congress for a 
long, long time. It has basically kept this modernization legislation 
from passing Congress now for the last 20 years.
  We finally in our committee, after a lot of hard work and a lot of 
gnashing of teeth and a lot of long nights and negotiations between the 
parties, came to an agreement on how we would best deal with banks 
selling insurance; and we basically came to that conclusion that 
indeed, based on court decisions, the Barnett decisions and decisions 
by the OCC that indeed banks would be in a position to sell insurance.
  So the next question is how do we best protect the consumer and at 
the same time allow that kind of activity to take place. So we got the 
players together, the president of the insurance agents, the 
representatives of the insurance agents, representatives of the banks, 
or some banks at least, the ones that were participating in our effort, 
particularly Bank One and NationsBank, who were real leaders in trying 
to come to a conclusion. And after a lot of negotiations and after 
having testimony from the Illinois representatives of the agents and 
the banks telling us how they worked so hard to get a bill passed in 
the Illinois legislature unanimously and signed by the governor that 
became essentially the template for what we tried to do in this piece 
of legislation.

                              {time}  1715

  It is not perfect. In many cases, all of us would have written this 
differently depending on where we are coming from. But the fact is it 
was forged in the caldron of compromise in a major State and signed off 
on by the major players. That is really what we use the basis for our 
provision on insurance in our committee. It has survived on to the 
floor.
  Unfortunately, the amendment of the gentleman from Louisiana (Mr. 
Baker) would rend asunder our ability to make those kind of changes 
that we basically have the major players sign off on. It removes, in my 
estimation, a critical consumer protection preventing implicit 
coercion; that is tying of insurance sales to loans. I think we do have 
to provide the kind of protection for the consumer that is absolutely 
necessary.
  Another concern I have is that the Baker amendment contains a 
mischievous provision requesting the OCC, the Federal bank regulator, 
to report to Congress on the effectiveness of State insurance laws. 
That, in my estimation, is already predetermined how

[[Page H3203]]

that would come out. I ask you to defeat the Baker amendment, as well-
intentioned as it may be and support the underlying bill.
  Ms. JACKSON-LEE of Texas. Madam Chairman, I rise to speak in 
opposition to the Baker Amendment.
  This amendment's aim and consequence is to eviscerate the Community 
Reinvestment Act. That Act was created in order to encourage banks to 
meet the credit needs of the communities in which they were located.
  That Act is the child of a successful grass-roots movement that is 
over 20 years old: the ``anti-redlining'' campaign.
  In the late 60s, the ``anti-redliners'' took it upon themselves to 
investigate just how well banks were treating the customers from the 
communities in which they were located. Their discoveries were 
shocking. Many banks were using their financial leverage to siphon the 
savings of middle and lower income neighborhoods, only to turn around 
and invest those same funds in upper-class neighborhoods.
  Although not alone, the Community Reinvestment Act remedied much of 
this problem. It gave many deserving Americans access to credit and 
capital for the first time. And it did so, and continues to do so by 
simply telling banks that they must make better efforts to serve each 
and every person that comes before them.
  Respected Colleagues, this Act did what it was advertised to do, 
something I wish I could say about much of what we produce. It has 
resulted in over $200 billion dollars worth of investments in low-
income and minority areas.
  Under the Baker Amendment, any bank worth less than $140 million 
dollars would be exempt from the requirements of the Community 
Reinvestment Act. Ladies and gentlemen, that exemption would capture 
80% of all of our banks and thrifts!
  Under the current law, most of these banks already operate under a 
relaxed version of the Community Reinvestment Act standards. These 
``streamlined'' rules are more than satisfactory to banks. There is no 
reason to fix something that is not broken.

  This amendment is a profound step backwards for urban communities and 
minorities. Not only do I not want to face constituent-entrepreneurs 
who can no longer obtain loans for their small businesses, I also do 
not want to hear the outcries from the neighborhoods that are being 
deprived of the essential services which only come to them in the form 
of locally-owned, family businesses.
  I also realize that the Community Reinvestment Act if often the only 
means that urban development groups can reach agreements with banks. If 
this Congress wants to continue to look for private solutions for 
social problems--why do we want to take away the most effective tool 
for getting private institutions and local communities to sit down at 
the same table? It just makes no sense.
  What does make sense? The Community Reinvestment Act has been 
instrumental in over 300 different community renewal projects in over 
70 different metropolitan and rural communities.
  Furthermore, this amendment allows the banking industry to measure 
its own performance in providing minority access to lending against 
other banking institutions. Even more importantly, it removes the 
proverbial leash from banks, allowing them to revert to their 
discriminatory lending practices of the past.
  I ask my fellow colleagues not only to vote against this amendment, 
but also realize that the Community Reinvestment Act provides benefits 
to all citizens of the United States, giving us all equal access to the 
``economic wells'' that make our country great.
  The CHAIRMAN. The question is on the amendment offered by the 
gentleman from Louisiana (Mr. Baker).
  The question was taken; and the Chairman announced that the noes 
appeared to have it.


                             Recorded Vote

  Mr. BAKER. Madam Chairman, I demand a recorded vote.
  A recorded vote was ordered.
  The vote was taken by electronic device, and there were--ayes 140, 
noes 281, answered ``present'' 1, not voting 10, as follows:

                             [Roll No. 145]

                               AYES--140

     Aderholt
     Archer
     Armey
     Bachus
     Baker
     Barrett (NE)
     Bartlett
     Barton
     Bereuter
     Bilbray
     Bilirakis
     Boehlert
     Boehner
     Bonilla
     Bono
     Boucher
     Brady
     Bryant
     Bunning
     Buyer
     Callahan
     Camp
     Canady
     Cannon
     Castle
     Chambliss
     Chenoweth
     Coble
     Coburn
     Collins
     Combest
     Cook
     Cooksey
     Cox
     Cramer
     Crapo
     Davis (VA)
     Deal
     DeLay
     Dickey
     Doolittle
     Dreier
     Duncan
     Ehrlich
     Emerson
     English
     Ensign
     Everett
     Ewing
     Fawell
     Foley
     Fox
     Gallegly
     Gilchrest
     Goode
     Goodlatte
     Goss
     Graham
     Granger
     Gutknecht
     Hansen
     Hayworth
     Hefley
     Hill
     Hilleary
     Hoekstra
     Horn
     Hostettler
     Hulshof
     Hunter
     Hutchinson
     Inglis
     Istook
     Jenkins
     Johnson, Sam
     Jones
     Kelly
     Kim
     King (NY)
     Klug
     Largent
     Latham
     LaTourette
     Lazio
     Linder
     Lucas
     McCollum
     McCrery
     McInnis
     McIntosh
     McKeon
     Miller (FL)
     Moran (KS)
     Moran (VA)
     Myrick
     Nethercutt
     Neumann
     Norwood
     Nussle
     Paul
     Pease
     Peterson (MN)
     Peterson (PA)
     Petri
     Pickering
     Pombo
     Portman
     Pryce (OH)
     Ramstad
     Redmond
     Regula
     Riley
     Rogers
     Rohrabacher
     Ryun
     Scarborough
     Schaffer, Bob
     Sensenbrenner
     Sessions
     Shadegg
     Smith (MI)
     Smith (TX)
     Snowbarger
     Souder
     Stearns
     Stenholm
     Stump
     Sununu
     Talent
     Tauzin
     Taylor (MS)
     Taylor (NC)
     Thornberry
     Thune
     Tiahrt
     Wamp
     Watkins
     Watts (OK)
     Weldon (FL)
     Wicker

                               NOES--281

     Abercrombie
     Ackerman
     Allen
     Andrews
     Baesler
     Baldacci
     Ballenger
     Barcia
     Barr
     Barrett (WI)
     Bass
     Becerra
     Bentsen
     Berman
     Berry
     Bishop
     Blagojevich
     Bliley
     Blumenauer
     Blunt
     Bonior
     Borski
     Boswell
     Boyd
     Brown (CA)
     Brown (FL)
     Brown (OH)
     Burr
     Burton
     Calvert
     Campbell
     Capps
     Cardin
     Carson
     Chabot
     Clay
     Clayton
     Clement
     Clyburn
     Condit
     Conyers
     Costello
     Coyne
     Crane
     Cubin
     Cummings
     Cunningham
     Danner
     Davis (FL)
     Davis (IL)
     DeFazio
     DeGette
     Delahunt
     DeLauro
     Deutsch
     Diaz-Balart
     Dicks
     Dingell
     Dixon
     Doggett
     Dooley
     Doyle
     Dunn
     Edwards
     Ehlers
     Engel
     Eshoo
     Etheridge
     Evans
     Farr
     Fattah
     Fazio
     Filner
     Forbes
     Ford
     Fossella
     Fowler
     Frank (MA)
     Franks (NJ)
     Frelinghuysen
     Frost
     Furse
     Ganske
     Gejdenson
     Gekas
     Gephardt
     Gibbons
     Gillmor
     Gilman
     Goodling
     Gordon
     Greenwood
     Gutierrez
     Hall (OH)
     Hamilton
     Hastert
     Hastings (FL)
     Hastings (WA)
     Herger
     Hinchey
     Hinojosa
     Hobson
     Holden
     Hooley
     Houghton
     Hoyer
     Hyde
     Jackson (IL)
     Jackson-Lee (TX)
     Jefferson
     John
     Johnson (CT)
     Johnson (WI)
     Johnson, E. B.
     Kanjorski
     Kaptur
     Kasich
     Kennedy (MA)
     Kennedy (RI)
     Kennelly
     Kildee
     Kilpatrick
     Kind (WI)
     Kingston
     Kleczka
     Klink
     Knollenberg
     Kolbe
     Kucinich
     LaFalce
     LaHood
     Lampson
     Lantos
     Leach
     Lee
     Levin
     Lewis (CA)
     Lewis (GA)
     Lewis (KY)
     Lipinski
     Livingston
     LoBiondo
     Lofgren
     Lowey
     Luther
     Maloney (CT)
     Maloney (NY)
     Manton
     Manzullo
     Markey
     Martinez
     Mascara
     Matsui
     McCarthy (MO)
     McCarthy (NY)
     McDade
     McDermott
     McGovern
     McHale
     McHugh
     McIntyre
     McKinney
     McNulty
     Meehan
     Meek (FL)
     Meeks (NY)
     Menendez
     Metcalf
     Mica
     Millender-McDonald
     Miller (CA)
     Minge
     Mink
     Moakley
     Mollohan
     Morella
     Murtha
     Nadler
     Neal
     Ney
     Northup
     Oberstar
     Obey
     Olver
     Ortiz
     Owens
     Oxley
     Packard
     Pallone
     Pappas
     Parker
     Pascrell
     Pastor
     Payne
     Pelosi
     Pickett
     Pitts
     Pomeroy
     Porter
     Poshard
     Price (NC)
     Quinn
     Rahall
     Rangel
     Reyes
     Riggs
     Rivers
     Rodriguez
     Roemer
     Rogan
     Ros-Lehtinen
     Rothman
     Roukema
     Roybal-Allard
     Royce
     Rush
     Sabo
     Salmon
     Sanchez
     Sanders
     Sandlin
     Sanford
     Sawyer
     Saxton
     Schaefer, Dan
     Schumer
     Scott
     Serrano
     Shaw
     Shays
     Sherman
     Shimkus
     Shuster
     Sisisky
     Skeen
     Skelton
     Slaughter
     Smith (NJ)
     Smith (OR)
     Smith, Adam
     Smith, Linda
     Snyder
     Solomon
     Spence
     Spratt
     Stabenow
     Stark
     Stokes
     Strickland
     Stupak
     Tanner
     Tauscher
     Thomas
     Thompson
     Thurman
     Tierney
     Torres
     Towns
     Traficant
     Turner
     Upton
     Velazquez
     Vento
     Visclosky
     Walsh
     Waters
     Watt (NC)
     Waxman
     Weldon (PA)
     Weller
     Wexler
     Weygand
     White
     Whitfield
     Wise
     Wolf
     Woolsey
     Wynn
     Yates
     Young (AK)
     Young (FL)

                        ANSWERED ``PRESENT''--1

       
     Hall (TX)
       

                             NOT VOTING--10

     Bateman
     Christensen
     Gonzalez
     Green
     Harman
     Hefner
     Hilliard
     Paxon
     Radanovich
     Skaggs

                              {time}  1737

  Ms. FURSE and Mr. McHUGH changed their vote from ``aye'' to ``no.''
  Messrs. DOOLITTLE, CANNON, DICKEY and REDMOND changed their vote from 
``no'' to ``aye.''
  So the amendment was rejected.
  The result of the vote was announced as above recorded.


                          Personal Explanation

  Mr. GREEN. Madam Chairman, I missed rollcall vote 145 because I was 
unavoidably detained. Had I been here, I would have voted no.

[[Page H3204]]

  The CHAIRMAN. The Chair has been advised that Amendment No. 4 has 
been withdrawn.
  It is now in order to consider Amendment No. 5 printed in part 2 of 
House Report 105-531.


                Amendment No. 5 Offered by Mrs. Roukema

  Mrs. ROUKEMA. Madam Chairman, I offer an amendment.
  The CHAIRMAN. The Clerk will designate the amendment.
  The text of the amendment is as follows:

       Amendment No. 5 offered by Mrs. Roukema:
       Strike subparagraph (A) of section 6(f)(1) of the Bank 
     Holding Company Act of 1956, as added by section 103(a) of 
     the Amendment in the Nature of a Substitute, and insert the 
     following new subparagraph:
       ``(A) the aggregate annual gross revenues derived from all 
     such activities and all such companies does not exceed 10 
     percent of the consolidated annual gross revenues of the 
     financial holding company;''.
       Strike paragraph (2) of section 6(f) of the Bank Holding 
     Company Act of 1956, as added by section 103(a) of the 
     Amendment in the Nature of a Substitute.
       Strike paragraph (3) of section 6(f) of the Bank Holding 
     Company Act of 1956, as added by section 103(a) of the 
     Amendment in the Nature of a Substitute, and insert the 
     following new paragraph:
       ``(2) Foreign banks.--In lieu of the limitation contained 
     in paragraph (1)(A) in the case of a foreign bank or a 
     company that owns or controls a foreign bank which engages in 
     any activity or acquires or retains ownership or control of 
     shares of any company pursuant to paragraph (1), the 
     aggregate annual gross revenues derived from all such 
     activities and all such companies in the United States shall 
     not exceed 10 percent of the consolidated annual gross 
     revenues of the foreign bank or company in the United States 
     derived from any branch, agency, commercial lending company, 
     or depository institution controlled by the foreign bank or 
     company and any subsidiary engaged in the United States in 
     activities permissible under section 4 or 6.''.
       Strike paragraph (4) of section 6(f) of the Bank Holding 
     Company Act of 1956, as added by section 103(a) of the 
     Amendment in the Nature of a Substitute and insert the 
     following new paragraph:
       ``(3) Financial holding company growth beyond cap.--
     Notwithstanding paragraph (1), the Board may, on a case by 
     case basis, allow the aggregate annual gross revenues derived 
     by a financial holding company from activities engaged in, or 
     companies the shares of which such holding company owns or 
     controls, under this subsection to exceed the 10 percent 
     limitation contained in subparagraph (A) of such paragraph so 
     long as--
       ``(A) such aggregate annual gross revenues do not exceed 15 
     percent of the consolidated annual gross revenues of the 
     financial holding company; and
       ``(B) the financial holding company does not commence any 
     new activity, or acquire ownership or control of shares of a 
     company, under this subsection after the date on which such 
     gross revenues first exceed 10 percent of the consolidated 
     annual gross revenues.''.
       After paragraph (3) (as so redesignated) of section 6(f) of 
     the Bank Holding Company Act of 1956, as added by section 
     103(a) of the Amendment in the Nature of a Substitute insert 
     the following new paragraph:
       ``(4) Domestic growth of foreign bank beyond cap.--
     Notwithstanding paragraph (2), the Board may, on a case by 
     case basis, allow the aggregate annual gross revenues derived 
     by a foreign bank from activities engaged in, or companies 
     the shares of which such foreign bank owns or controls, in 
     the United States under this subsection to exceed the 10 
     percent limitation contained in such paragraph so long as--
       ``(A) such aggregate annual gross revenues do not exceed 15 
     percent of the consolidated annual gross revenues of the 
     foreign bank or company in the United States derived from any 
     branch, agency, commercial lending company, or depository 
     institution controlled by the foreign bank or company and any 
     subsidiary engaged in the United States in activities 
     permissible under section 4 or 6; and
       ``(B) the foreign bank does not commence any new activity, 
     or acquire ownership or control of shares of a company, under 
     this subsection after the date on which such aggregate annual 
     gross revenues first exceed the 10 percent limitation 
     contained in paragraph (2).''.
       Strike subsection (g) of section 6 of the Bank Holding 
     Company Act of 1956, as added by section 103(a) of the 
     Amendment in the Nature of a Substitute (and redesignate the 
     subsequent subsection and amend any cross reference to any 
     such subsection accordingly).

  The CHAIRMAN. Pursuant to House Resolution 428, the gentlewoman from 
New Jersey (Mrs. Roukema) and a Member opposed each will control 15 
minutes.
  The Chair recognizes the gentlewoman from New Jersey (Mrs. Roukema).
  Mrs. ROUKEMA. Madam Chairman, I yield myself such time as I may 
consume.
  Madam Chairman, this amendment is a straightforward one. All 
financial holding companies, under this amendment, will be entitled to 
derive 10 percent of their gross annual revenue from nonfinancial 
activities and investments.
  Once a financial holding company hits the 10 percent commercial 
basket, they would not be permitted to make new investments. They would 
be permitted to have a 10 percent commercial basket with a cap. They 
would not be permitted to make new investments in commercial entities 
or activities once they reach that cap. The Federal Reserve, and this 
is very important, could approve on a case-by-case basis a financial 
holding company application for an additional 5 percent, but it would 
only be at the discretion of the Fed, with very strict parameters.
  There are several good reasons, in my opinion, for increasing the 
commercial basket to 10 percent. In the first place, I believe we need 
that famous, or infamous, two-way street for all market participants. 
It should be understood by my colleagues that banks, security firms and 
insurance companies need to be able to affiliate on an equal basis as 
in a holding company.
  The 10 percent commercial basket is especially important for those 
who are concerned about their banks. It would establish parity among 
banks, securities firms and insurance companies by establishing a 
single limit that applies to all participants.
  The basket is only modest. As I have said, it would have strict 
safety and soundness supervision and examinations by Federal and State 
regulators. Sections 23(a) and 23(b) of the Federal Reserve Act impose 
a significant limitation on transactions with affiliates, and the 
Federal safety net, the deposit insurance funds and the Federal payment 
systems, are more than adequately protected by the limits in this bill.

                              {time}  1745

  I want to assure people of that. The commercial basket would 
accommodate normal growth of income from commercial activities. I do 
not have time to go into the business cycle effects, but I think that 
really indicates, it is really an indication of a lot of common sense 
about that. It gives the elasticity to accommodate the banks, the 
securities firms and the insurance industry.
  If financial services holding companies can invest in commercial 
activities, as under this bill, as under this amendment, there will be 
a new potential source of capital for small and midsized companies. I 
know I have heard that question raised by numbers of constituents, and 
I think we can go back to our small and midsized companies, which all 
of us know are really an engine of growth in our communities, and we 
know what trouble they have attracting capital. I believe that this 10 
percent basket will be very helpful to them.
  Madam Chairman, every day I think that we know that there are new 
products and services and we can certainly understand how this 10 
percent basket would help in creating those new innovations for 
variable annuities, money market deposit accounts and sweep accounts, 
and it would be a help to those.
  Now, I want to stress to all of our Members that this is probably a 
subject that is not well understood by many Members, but I have to tell 
my colleagues that the Committee on Banking and Financial Services, in 
committee, adopted an even larger basket, a 15 percent basket, with a 
2-to-1 margin. After studying this for months and months and months, 
our committee voted 35-to-19 to allow a 15 percent basket.
  Madam Chairman, my amendment is more modest. It takes a more modest, 
smaller step towards this innovation. But I also must say that all 5 
subcommittee chairmen of the Committee on Banking and Financial 
Services support this amendment, and I note with great pride and 
appreciation the fact that we have bipartisan support with the ranking 
member of the full committee, the gentleman from New York (Mr. 
LaFalce), and the gentleman from Minnesota (Mr. Vento), my ranking 
member on the Subcommittee on Financial Services. We all give strong 
support to this amendment.
  The securities industry and the insurance industry strongly support 
the amendment, and I must repeat that this is particularly important to 
the

[[Page H3205]]

bankers because the amendment does give parity, a parity arrangement 
for banks in this new financial services world.


                  background--what the amendment does

  My amendment is straightforward. All financial holding companies 
would be entitled to derive 10% of their gross annual revenue from 
nonfinancial activities and investments. Once a financial holding 
company hits the 10 percent commercial revenue cap, they would not be 
permitted to make new investments in commercial entities or activities. 
The Federal Reserve could approve, on a case by case basis, financial 
holding company application to receive up to an additional 5 percent in 
earnings from existing commercial activities.
  The bill as currently drafted would limit the amount of revenue to 5 
percent of annual gross domestic revenues. My amendment would expand 
that limit to 10 percent of annual gross domestic revenues.
  There are several good reasons for increasing the size of the 
commercial basket to 10 percent.


                           the two way street

  We need a two way street for all market participants.
  Banks, securities firms and insurance companies need to be able to 
affiliate on an equal basis in a holding company.
  Insurance companies and securities firms are not prohibited from 
affiliating with commercial entities. They derive significant revenue 
from these nonfinancial activities.
  Insurance companies and securities firms need a commercial basket so 
they can be financial services holding companies. Without a basket they 
will have to curtail existing commercial activities.
  The bill would grandfather existing commercial activities of 
securities and insurance firms--up to 15 percent of annual gross 
revenues.
  Bank holding companies would be limited to 5% of annual gross 
domestic revenues.
  My 10 percent commercial basket would establish parity among banks, 
securities firms and insurance companies, by establishing a single 
limit that applies to all participants.


                          safety and soundness

  The basket is modest--only 10 percent of annual gross revenues.
  Strict supervisiion and examination by the State and Federal 
regulators.
  Sections 23A and 23B of the Federal Resrve Act imposes significant 
limitations on transactions with affiliates.
  The federal safety net--the deposit insurance funds and the federal 
payment systems--are adequately protected by the limits in the bill.


              10 percent accommdates business fluctuations

  The 10 percent commercial basket would accommodate normal growth of 
income from commercial activities.
  It is the hope of every businessman that their businesses will grow. 
The 10 percent commercial basket will permit enough flexibility to 
accommodate reasonable increases in income from commercial activities.
  The 10 percent commercial basket would also help accommodate any 
seasonal decrease in the amount of revenue derived from ``financial'' 
activities.
  The business cycle affects all industries. For instance a securities 
firm's revenues may rise or fall depending on general economic 
conditions. Insurance company revenues can be affected by natural 
disasters. Banks revenues are significantly affected by interest rate 
changes.
  The basket will be large enough to account for normal fluctuations in 
the holding company's financial business.


                            economic growth

  A commercial basket will encourage economic growth.
  If financial services holding companies can invest in commercial 
entities there will be a new potential source of capital for small and 
midsized companies.
  Small and midsized companies--which are the engine of most growth in 
the United States--frequently have problems attracting equity 
financing.
  The 10 percent commercial basket may help these new and innovative 
companies.
  The 10 percent commercial basket may also promote community 
reinvestment. Holding companies could make investments in their 
community's businesses and contribute to vibrant, growing local 
economy.


                          enhance competition

  The 10 percent commercial basket will enhance competition between all 
participants in the financial services industry.
  This bill is supposed to level the playing field between the banking, 
securities and insurance industries.
  The insurance and securities firms have never been prohibited from 
affiliating with commercial firms.
  The 10 percent basket would permit a ``modest'' level of commercial 
affiliation and would enhance competition.


                       new products and services

  Innovation is the United States.
  Every day there are new products and services.
  Examples include: variable annuities, money market deposit accounts, 
and sweep accounts.
  A basket which is too small would result in statutory and regulatory 
barriers which the legislation is supposed to eliminate.
  We need to have a basket large enough to accommodate the new products 
and services which the financial services industry creates in the 
coming years.
  This amendment has significant support.
  The Banking Committee adopted a larger 15 percent basket by a vote of 
35-19. A 2 to 1 margin.
  All 5 Banking Subcommittee Chairmen supported this amendment.
  The amendment enjoyed strong bipartisan support in committee.
  I note that Mr. LaFalce, the ranking minority member of the full 
committee, and Mr. Vento, the ranking member on my financial 
institutions subcommittee, support this amendment.
  Other members of the committee will be speaking in support of this 
amendment.
  The securities industry and the insurance industry strongly support 
this amendment. And this amendment, to repeat, will give parity (pg.2) 
to the Banks.
  Madam Chairman, I reserve the balance of my time.
  Mr. LEACH. Madam Chairman, I rise in opposition to the amendment.
  I do not want to speak at length at this time; I simply would say 
that the gentlewoman has outlined a very thoughtful perspective on a 
very troubling area of law. I happen to believe this is perhaps the 
most profound amendment, if not profound approach, that applies to the 
financial landscape in the United States that can be expressed or will 
be addressed by this body, and I will have a substitute amendment at 
the appropriate time that will be designed, in effect, to negate the 
effects of this particular amendment.
  I would simply suggest to my colleagues that if one believes that 
what this country needs is more conglomeration, greater integration of 
financial institutions with other parts of commerce, then this 
amendment is a very sensible way to go. If, on the other hand, one 
believes that the engine of dynamism in this country are smaller 
enterprises, more discreet enterprises, enterprises that are hallmarked 
by competition, enterprises that are hallmarked by nonintertwined 
capitalism, then I think one will want to give serious thought to 
alternatives, or the alternative that I will be presenting.
  Madam Chairman, at this time I would allow the gentlewoman and the 
advocates of her approach to make as strong a case as they can marshal, 
and I reserve the balance of my time.
  Mrs. ROUKEMA. Madam Chairman, I yield 3 minutes to the gentleman from 
Minnesota (Mr. Vento), the ranking member of the subcommittee.
  (Mr. VENTO asked and was given permission to revise and extend his 
remarks.)
  Mr. VENTO. Madam Chairman, I rise in strong support of the Roukema-
Vento-LaFalce, and Baker amendment. This is a good amendment. This I 
think is an amendment which provides parity for both the banking, the 
securities, and the insurance industries.
  As we seek to modernize financial institutions, Madam Chairman, in 
the past, the Committee on Banking and Financial Services has guided 
into enactment, working with the Senate and the administration, the 
Branching and Interstate Banking Act, which in essence, vertically 
integrated and provided an opportunity for banks to work across State 
lines and eliminate some of the geographic barriers.
  What is occurring here and what has been said by the regulators is, 
of course, the recognition that financial entities, insurance, banking, 
and securities, have instruments that look very much alike. What we 
want is a 2-way street regards their ability to do business. We want 
the securities and insurance industry, which has historically involved 
an equity ownership that is commerce, to, in fact, be able to 
participate and not to have to change the entire nature of the way that 
they operate in a limited extent, and of course operating at a 10 
percent equity ownership position would facilitate that.
  Now, on the banking side, we have had any number of intrusions in 
terms of commerce. In fact, this bill personifies some of those 
intrusions, such as

[[Page H3206]]

the non-bank bank provisions of this bill; such as the provisions in 
this bill that permit nearly 100 unitary thrifts to continue to have a 
commerce role, 100 of them, without any limitation as to a percent of 
revenue or assets. There is no 10 percent limitation in this example.
  Then, of course, we have banks that are owned by commercial companies 
in this Nation. There are 4 or 5 of them. And we have, of course, 
looking beyond that, looking at our U.S. banks that operate abroad, 
they all have a commerce role in those market places where they are not 
limited. They own commercial interests abroad and exercise, I might 
say, many other powers out of a holding company or even subsidiary 
going back to a past argument and are regulated by the Federal Reserve, 
curiously, who doesn't object to such relationship.
  So there is a mixture of commerce and banking. That already is an 
established fact. I have just given my colleagues 4 or 5 instances of 
commerce banking ownership by banks. The question is, are we going to 
rationalize and regulate this in a consistent and fair manner? That is 
what we are trying to do with this amendment.
  We recognize that to completely shut off commerce in banking, we 
would be shutting down this particular bill in terms of what securities 
firms or insurance firms may be able to do, and to deny that the 
Federal Reserve Board, through some artifice that they suggest: Well, 
the bank does not have controlling interest, they only have this 
investment in this area; they only have a participation in this 
particular area. Well, that is an artifice. That is an artificial 
distinction, and we should recognize that and adopt an amendment that 
gives parity to both banks and the other institutions such as the 
Roukema-Vento amendment, and I urge my colleagues to adopt it.
  I rise in support of the Roukema-Vento amendment that will provide a 
parity basket--that is an equal 10 percent basket for all financial 
holding companies--as opposed to the unequal 5 percent for banks and 15 
percent for everyone else basket.
  As my colleague stated, the amendment would provide a 10 percent of 
annual gross revenues basket for commercial activities. This limited 
basket is further narrowed because affiliations would be prevented 
between the largest 1,000 U.S., companies. A further safeguard is the 
prohibition on transactions with affiliates engaged in non-financial 
activities.
  This amendment is a responsible approach that recognizes the reality 
of our financial marketplace and works within that framework. It would 
reduce the disparity between bankholding companies that would be frozen 
at 5 percent, and the new financial holding companies formed by 
securities or insurance companies that would have a 15 percent basket. 
There is no rationale for the difference.
  What is important to recognize is that commerce and banking are 
already in the marketplace on an ``ad hoc'' and ``exception to the 
rule'' basis. What the bill does and the Roukema-Vento amendment does 
better is make a clear and reasonable framework for the linking. 
Without a basket, there is no ``two way street'' which is modernization 
speak for an opportunity for securities and insurance companies to 
affiliate with bank. That is why even the Leach ZERO basket approach 
allows the very thing he and his supporters will preach against--a 15 
percent basket for up to 15 years.
  If Congress were acting in a void, the creation of a financial system 
that creates an absolute and total separation of banking and commerce 
might be achievable. In fact, however, we are not working in a void.
  There is a long tradition of equity ownership with investment banking 
and insurance industries. The regulators have been playing around the 
edges with regard to operating subsidiary powers and on Section 20 
affiliates. The unitary thrift holding company provides a clear 
opportunity for commerce and banking and that over 100 unitaries are 
using today. We have non-bank banks, grandfathered banks, and 
grandfathered activities. What we don't have is a level and open 
playing field that recognizes the reality of today's marketplace. We 
need a rational overall structure that establishes the same firewalls, 
the same rules and same competitive opportunities for everyone within 
the U.S. financial services industries.
  This amendment, really a take off from legislation Mrs. Roukema and I 
introduced early last session, provides that overarching structure and 
a two-way street. Total restrictions on banking and commerce need to be 
lifted so that financial services entities can diversify: spreading 
risk and increasing profitability. The EQUAL 10 percent basket, with 
the ability for the Federal Reserve Board to move to 15 percent in 
strict circumstances, will provide running room to allow for ups and 
downs in the business cycle and will assure that the majority of 
financial services companies will not immediately bump up against the 
top of the basket.
  I urge my colleagues to support this amendment and to oppose the 
Leach amendment that follows. This basket parity amendment is one small 
step in the direction of the banking industry. This parity amendment 
will keep the law relevant to the current and future market conditions 
of all players. While this bill remains flawed for banks, passage of 
this amendment will alleviate one of the unfair aspects of H.R. 10--
while the Leach amendment will only make it worse.
  Mr. LEACH. Madam Chairman, I yield 4 minutes to the distinguished 
gentleman from Nebraska (Mr. Bereuter), who has such a thoughtful 
perspective on this issue, and who is also the chairman of the 
Subcommittee on Asia and the Pacific, and I think might want to address 
that perspective.
  (Mr. BEREUTER asked and was given permission to revise and extend his 
remarks.)
  Mr. BEREUTER. Madam Chairman, I am a 17-, 18-year member of the 
Committee on Banking and Financial Services. I do chair the 
Subcommittee on Asia and the Pacific of the House Committee on 
International Relations, and I think, frankly, that is a more relevant 
set of experience right now for this legislation than service on the 
Committee on Banking and Financial Services. Because of that 
combination, I have had an opportunity to watch up close, first as a 
member of the authorizing subcommittee for the IMF legislation or the 
activities of the IMF, and then from the Asia and Pacific Subcommittees 
to see what is happening in Japan and Korea and Thailand in recent 
months.
  I want to speak in the strongest possible terms of my opposition to 
the Roukema-Vento amendment and for the Leach-Campbell-Bereuter 
substitute.
  What we have seen over the last few years is a Japanese banking 
system where the assets have grown tremendously because Japanese banks 
have been able to take equity positions or ownership in businesses. So 
as the economy was good in Japan, the assets of those banks also moved 
upward dramatically with the progress of those industries. So Japan had 
most of the largest 20 or 25 banks in the world. But what happens with 
their mixing of banking and commerce is that it also exaggerates trends 
downward. So at a time when the Japanese need a strong banking system, 
they do not have that strong banking system to help them spin out of 
their economic difficulties.
  In fact, if we take a look at the ownership of a Japanese bank today 
and their assets, we will find that they can take 5 percent ownership 
in this business, 5 percent in this business, 5 percent in this 
business, and so on, and as those businesses had trouble, then, in 
fact, the asset base of the banks also has deteriorated.
  We have also had, there and in Korea, an incestuous relationship 
between banks and businesses. So we have the disaster in the Republic 
of Korea today with the chaebols, those huge conglomerates, when banks 
gave loans to such businesses without considering the real risk, but 
only on the basis of those incestuous business relationships. And the 
same sort of thing happened in Japan and Thailand. I can tell my 
colleagues that the burden of proof should be on those people in 
Congress and not American society that want to change Glass-Steagall--
those who want to eliminate the separation between commerce and 
banking.
  What did Paul Volcker tell the Committee on Banking and Financial 
Services? I want to quote from his statement to us. He said, ``The 
American financial system is the most vigorous, flexible, innovative, 
quickest-to-change, most efficient in allocating capital, and it has 
been done by maintaining the separation. So the burden of proof seems 
to me to be on those who want to end this separation. We are doing fine 
without it, and without exception those countries that have more 
connections between banking and commerce are noted for having 
inflexible systems.''
  The burden of proof, my colleagues, is on those people who want to 
establish this so-called ``basket,'' and certainly, it is on those 
people who want to accentuate the size of it. Once we

[[Page H3207]]

cross that line, once we eliminate the separation between commerce and 
banking, we know what is going to happen. The beneficiaries of this 
change are going to be in here every year asking for an increase. That 
is not in the best interests of the United States.
  Madam Chairman, I want to suggest to my colleagues that the burden of 
proof indeed should be on those people that want to break down the 
barriers between commerce and banking, on those who want to disturb the 
status quo. We have the strongest banking system in the world, and we 
have loans being made on the basis of risk, not on the basis of 
incestuous relationships between banks and business.
  I would like to ask my colleagues to take a look at a ``Dear 
Colleague'' letter that the gentleman from Iowa (Mr. Leach), the 
chairman of the committee, and the gentleman from California (Mr. 
Campbell) and I have circulated to show my colleagues the breadth of 
the opposition to any changes in Glass-Steagall. It is extraordinary. 
It spans the ideological-business-political-labor spectrum. This 
elimination of the Glass-Steagall barrier is a step we do not want to 
take. Vote ``no,'' vote ``no'' emphatically on the Roukema-Vento 
amendment, and support the status quo, which keeps the barrier between 
banking and commerce.
  Mrs. ROUKEMA. Madam Chairman, I yield myself such time as I may 
consume to observe my colleague's arguments against my amendment. I 
will reserve most of them for the debate on the Leach proposal, but I 
would say that there is no comparison, none whatsoever, between what 
the Japanese, the south Koreans or the Indonesians do in terms of 
regulatory controls and the accounting practices and the forcing of 
conflicts of interest under their system. So the comparisons with 
Southeast Asia are not valid.

                              {time}  1800

  To tell Members the truth, some of the strongest banking financial 
systems in the world are in Europe, particularly in great Britain, 
Germany, and other European countries. Virtually every one of those 
countries have at least a 10 percent commercial entity, and in many 
cases, many more, and have had them for a long period of time.
  Madam Chairman, I yield 2 minutes to our colleague, the gentleman 
from New York (Mr. Engel).
  Mr. ENGEL. Madam Chairman, I thank the gentlewoman from New Jersey 
for yielding time to me.
  Madam Chairman, I rise in strong support of the 10 percent basket 
amendment, the Roukema-Vento-Baker-LaFalce amendment.
  This amendment is similar to an amendment I offered during the markup 
of this bill in the Committee on Commerce. As a New Yorker, I fully 
understand the importance and significance of providing the proper 
framework where financial services can thrive.
  Our nation's markets are the envy of the world, and New York is the 
capital of the world's economy. Any legislation that is reported must 
ensure that our financial structure retains its ability to adapt to the 
changing needs of the public.
  To this end, I believe that financial modernization legislation must 
allow banks, securities, and insurance firms with commercial interests 
to invest some percentage of its domestic gross revenues in 
nonfinancial services. Financial modernization legislation should 
reflect the current market, and permit some form of commercial 
affiliation. A 10 percent commercial basket is a reasonable first step 
toward integrating commerce and banking.
  Legislation on this matter must be flexible enough to ensure that 
financial service providers can continue to evolve. We cannot push back 
progress. Without a basket, many firms would be forced to choose 
between their current commercial activities and newly authorized 
banking powers. In addition, many firms would have difficulty competing 
in the global economy without having some ability to invest in foreign 
entities.
  While we are pleased that a 5 percent basket was included in the 
bill, a 10 percent basket provides the proper cushion to accommodate 
both the normal growth of a commercial enterprise and the potential 
decrease of financial activity revenues.
  To this end, I strongly urge my colleagues to vote for the 10 percent 
basket amendment. Financial providers must have the ability and the 
flexibility needed to move forward as we approach the 21st century. As 
the gentlewoman correctly pointed out, a 15 percent basket would even 
make more sense, but this is a scaled-back bill, a moderate bill, a 
bill trying to make progress, and a bill trying to get a majority of 
the votes.
  We cannot put our heads in the sand. We cannot be blinded. We cannot 
pretend that progress does not march on. To pretend that this is the 
same financial economy as that of 50 or 60 years ago just does not make 
sense. I urge my colleagues to vote for this very, very modest 
amendment, which moves us in the right direction.
  Mr. LEACH. Madam Chairman, I yield 3 minutes to the gentleman from 
Michigan (Mr. Dingell).
  Mr. DINGELL. Madam Chairman, I want to express affection and respect 
for the authors of this amendment, but I want to differ with them 
strongly on its need. I talked to the distinguished chairman of the 
Federal Reserve Board. He opposes this amendment, and he says this in 
his May 4 letter to me: ``There is every reason to move with caution in 
this area. The combining of banking and commerce is clearly 
irreversible. Once permitted, the Congress is unlikely to impose the 
costs and disruption of disentanglement.''
  Let us look at Germany. Their financial institutions have been 
discussed. The German economy is stagnant. They are exporting jobs 
because they cannot start them up at home.
  Look at Asia, and look what is happening. Over there, a bank can do 
anything it wants. They own property, they own real estate, they own 
businesses, they own stock. When values start going down on those kinds 
of assets, the bank is in serious trouble. It happened in Thailand, it 
happened in Korea, it has happened in Japan, and all three economies 
are stagnant, in good part because of this.
  Listen to what Chairman Greenspan says:

       The current turmoil in some Asian economies highlights the 
     risk that can arise from the interrelationships between banks 
     and nonbank corporate entities. First, if the 
     interrelationships are too close, the banks' decisions with 
     respect to lending might be based, not on the underlying 
     creditworthiness or other relevant characteristics of the 
     borrowers, but rather on such factors as implicit or explicit 
     subsidies, personal and business relationships, and common 
     managers.

  That is exactly what has happened in Japan, Thailand and Korea.
  Listen further:

       Second, the interrelationships can become so complex and 
     nontransparent that investors and counterparties cannot 
     properly understand or assess the banks' financial soundness.

  Again, this is happening in Korea, in Japan, and Thailand, and in the 
Asian economies which are in trouble. This amendment would authorize a 
replication of that unfortunate situation.
  Continuing,

       Both of those risks are important elements in the problems 
     now facing some Asian banking systems and are the reasons why 
     banking and commerce have historically been separated in the 
     United States.

  If Members want a more clear warning on the dangers of this 
amendment, check with Chairman Greenspan. Madam Chairman, the Chairman 
goes on to say this:

       Thus, it is critical that H.R. 10 retain its ongoing $500 
     million cap. Such a cap allows the controlled experimentation 
     of the mixing of banking and commerce, without locking 
     policymakers into one particular approach that, as noted, may 
     be impossible to reverse and that could do more harm than 
     good. . . . If the fundamental and longstanding structural 
     separation of banking and commerce in this country is to be 
     changed, the Board strongly believes that any modification 
     should proceed at a deliberate pace, in order to test the 
     response of market and technological innovations as well as 
     the supervisory regimes to the altered rules.

  I urge my colleagues to heed the warning that is present in these 
words. Do not replicate the follies of Korean, Japanese, Thai banking. 
Let us use responsibility. The strength of this country has been that, 
although our banks have not been as big as they would like to be, they 
have been strong.
  I have heard the banks complain constantly about the size of Japanese 
and Korean banks and their ability to do

[[Page H3208]]

all manner of things. It turns out that this ability to do all manner 
of things has created a disaster for these countries. We are being 
asked to bail them out. What are we going to do when our replication of 
their banking system creates the same abuses, the same hazards, and the 
same economic collapse for our constituents?
  I beg the Members, reject this amendment.
  Mrs. ROUKEMA. Madam Chairman, I yield 3 minutes to the gentleman from 
New York (Mr. LaFalce), the ranking member of the full committee.
  Mr. LaFALCE. I thank the gentlewoman for yielding time to me, Madam 
Chairman.
  Surely the whole question of banking and commerce is one of the most 
difficult for the committee to come to grips with. An attempt was made 
within the Committee on Banking and Financial Services to put 
responsible limitations on that combination. That was 15 percent across 
the board. But then the bill was changed when the Republican leadership 
brought it forth, and it is 15 percent for these new financial 
services' holding companies, and 5 percent for bank holding companies.
  So we have to understand that what the amendment that the gentlewoman 
from New Jersey would do is not to increase it from the existing bill, 
it is to level it. It is to bring the 15 percent down to 10, the 5 
percent to 10; to have a leveling of the field between these financial 
services holding companies, and the banks.
  It is also my understanding that subsequent to this amendment, the 
chairman of the committee, the gentleman from Iowa (Mr. Leach) will be 
offering an amendment with a zero basket but with a grandfather 
provision that would allow up to 15 percent. So even in this zero 
basket, as I understand it, the grandfathered institutions would have a 
higher basket than the Roukema amendment would provide.
  This is a difficult issue, but if we are to allow the mixing of 
banking and commerce, I think a 10 percent across-the-board basket 
would be more appropriate.
  In fashioning my motion to recommit, however, stripping the bill of 
the controversial national bank charter provisions, so we simply would 
not deal with it, so that we would simply deal with the Glass-Steagall 
and the bank holding company changes, it is my intent to follow the 
disposition of the House on this issue. If the House wants to go for 
15, 5, or 10, or a zero basket with a 15 percent for the grandfathered 
institutions, that is what I would incorporate in my motion to 
recommit.
  Mr. LEACH. Madam Chairman, I yield 2 minutes to the gentleman from 
Massachusetts (Mr. Markey).
  Mr. MARKEY. Madam Chairman, in 1694 the British parliament ruled that 
banking should not mix with commerce. In 1791, Alexander Hamilton, in 
the United States, decided that banking should not mix with commerce. 
Thus, it has been over the last 300 years in the Anglo-American 
tradition.
  Now we are told, since the 1980s, that we should mirror the Japanese 
model of Keiretsu, where bankers and industrialists work very closely 
together. In fact, we were told in the 1980s here in Congress that if 
we did not model ourselves upon the Japanese economic system, that we 
would become an economic power of the past.
  Now, in the 1990s, what do we see? Keiretsu in Japan means bankers 
and industrialists apologizing to the Japanese people for destroying 
their economy over the last 15 years. The American system continues on 
with its entrepreneurial, Darwinian, Adam Smith, ruthless set of 
decisions, with bankers deciding, venture capitalists deciding, which 
one of the American companies deserves more capital, not because it is 
tied to it, not because it is married to it.
  What happens as a result of the Japanese system? Something called 
Asian flu. That comes from having bankers too closely tied to 
industrialists, having too deep of an investment in them and anyone who 
gets close to them. What is recommended here by the Roukema amendment? 
That we should, as well, engage in Keiretsu.
  Our system is working. It has worked for 300 years. We do not have to 
abandon it and emulate the Japanese. The correct vote here tonight is 
no on Roukema, no on the Japanese system. It has failed, and failed 
badly. Vote yes on the Leach amendment. The Leach amendment will keep 
the continuation of the Anglo-American system.
  Mr. DINGELL. Madam Chairman, will the gentleman yield?
  Mr. MARKEY. I yield to the gentleman from Michigan.
  Mr. DINGELL. Madam Chairman, it is also no on the Korean system and 
the Thai system.
  Mr. LEACH. Madam Chairman, I yield myself such time as I may consume.
  Madam Chairman, let me make several points. There has been a lot of 
talk on the floor today about the bill in general. This amendment comes 
to summarize several aspects of it.
  For example, there has been talk about consumer issues, protecting 
the public. I do not know a bigger consumer issue or a bigger public 
protection issue than the question of do we allow the safety net of 
financial institutions to be spread to commercial activities of banking 
institutions. This is what has cost lots of countries in the world lots 
of money.
  Asian countries, European countries, a French bank, a Spanish bank, 
German institutions have cost substantial funds either to their 
institutions or to their public deposit safety nets, if they exist.
  Let me give an example in Germany, because we have focused so much 
time in the Far East. In Germany a few years back there was a metals 
firm that went under called Metallgesellschaft. This particular metal 
company entered into some very sophisticated derivatives trading.
  A study at the Chicago Federal Reserve Bank has indicated that they 
believe that the risk environment involved, the lack of supervision, 
because it was associated with a commercial bank, caused substantial 
losses; by ``substantial'', $6 billion.
  The Chicago Federal Reserve then examined an American company not 
associated with the bank, a major American company called Enron. Enron 
entered into the same kinds of derivative transactions on the same 
metals at the same time. It made a mistake or two, but because of the 
discipline of the United States stock market, Enron run survived quite 
nicely, and it is prospering today. Metallgesellschaft caused enormous 
losses to a particular financial institution.

                              {time}  1815

  Now, if we think about what it is that is at stake in all of this 
that one relates to, is there a difference between financial prowess 
and management of enterprise prowess? What we have developed in this 
country today are the most sophisticated capital markets, but also 
capacities of people that know how to manage money to take over lots of 
enterprises, enterprises that they may not be very good at managing.
  I happen to think that there is a huge distinction between management 
and financial prowess. And what this approach before us has in mind is 
the idea that because one is a good money manager, one then can become 
a manager of manufacturing, a manager of retail sales, and the end 
result is very simple. It is a concentration of ownership.
  This country has long had an antipathy to concentration of ownership. 
Here we are going to be looking at combining financial and commercial 
ownership in ways that I think, if one takes a step back and looks at 
it, one should have grave doubts about. I know, frankly, some very 
smart individuals have brought this approach to the Congress that are 
Members; smart people on the outside have suggested it would be the way 
to go. But every time I try to describe it neutrally to people in my 
district and I ask the local Rotary if they think the local bank ought 
to own the local department store, if they think it would be smart for 
a national auto company to be intertwined with a national bank, I get 
people saying, you have got to be crazy.
  That is what this amendment not only endorses, but leads to.
  I personally think we ought to just take a step back, think it 
through and suggest that mixing commerce and banking, which is an 
abstract concept, just simply does not fit the United States of 
America. I urge serious consideration of the amendment that I will 
shortly be offering to this particular approach.
  Mrs. ROUKEMA. Madam Chairman, I yield such time as he may consume to

[[Page H3209]]

the gentleman from Delaware (Mr. Castle).
  (Mr. CASTLE asked and was given permission to revise and extend his 
remarks.)
  Mr. CASTLE. Madam Chairman, I rise in strong support of the Roukema 
amendment.
  Mrs. ROUKEMA. Madam Chairman, I yield myself the balance of my time.
  I would simply like to say there have been a lot of dramatics here 
and a lot of quotes here and a lot of economic analysis, and I do not 
know that there has been substantiation of any of it. I do know that 
when Mr. Greenspan came before our committee, he indicated, no, he did 
not want to hold open the commercial basket, but he did say that we had 
to take a step in this direction. It was inevitable with technology and 
the global markets with which we are dealing. It was out there; we had 
to deal with it in some way or other.
  We are not opening it up, as has been implied here, to unlimited 
commercial activity. We are saying that 10 percent gives the legitimate 
two-way street and the parity and the kind of mixture that we are 
having between banks, insurance and securities. And that is all.
  Forget the drama. It is not keiretzu. When we get to the Leach 
amendment, I will give a little more of my own analysis of why we are 
not talking about Asian flu.
  The CHAIRMAN. It is now in order to consider substitute amendment No. 
6 printed in part 2 of House Report 105-531.


Amendment No. 6 Offered by Mr. Leach as a Substitute for Amendment No. 
                       5 Offered by Mrs. Roukema

  Mr. LEACH. Madam Chairman, I offer an amendment as a substitute for 
the amendment that would eliminate the commercial basket for financial 
services holding companies.
  The CHAIRMAN. The Clerk will designate the amendment.
  The text of the amendment is as follows:

       Part 2 amendment No. 6 printed in House Report 105-531 
     offered by Mr. Leach as a substitute for amendment No. 5 
     offered by Mrs. Roukema:
       Strike subsection (f) of section 6 of the Bank Holding 
     Company Act of 1956, as added by section 103(a) of the 
     amendment in the nature of a substitute (and redesignate 
     subsequent subsections and any cross reference to any such 
     subsection accordingly).
       In paragraph (1) of subsection (f) (as so redesignated) of 
     section 6 of the Bank Holding Company Act of 1956, as added 
     by section 103(a) of the amendment in the nature of a 
     substitute, strike ``subsection (f)(1) and''.
       In paragraph (2) of subsection (f) (as so redesignated) of 
     section 6 of the Bank Holding Company Act of 1956, as added 
     by section 103(a) of the amendment in the nature of a 
     substitute--
       (1) strike ``, as of the day before the company becomes a 
     financial holding company,''; and
       (2) insert ``(excluding revenues derived from subsidiary 
     depository institutions)'' before ``, on a consolidated 
     basis''.
       In paragraph (4) of subsection (f) (as so redesignated) of 
     section 6 of the Bank Holding Company Act of 1956, as added 
     by section 103(a) of the amendment in the nature of a 
     substitute, insert ``(excluding revenues derived from 
     subsidiary depository institutions)'' before the period at 
     the end.
       In paragraph (5) of subsection (f) (as so redesignated) of 
     section 6 of the Bank Holding Company Act of 1956, as added 
     by section 103(a) of the amendment in the nature of a 
     substitute, strike ``, subsection (f),''.
       In paragraph (6) of subsection (f) (as so redesignated) of 
     section 6 of the Bank Holding Company Act of 1956, as added 
     by section 103(a) of the amendment in the nature of a 
     substitute, strike ``, subsection (f),''.
       After paragraph (6) of subsection (f) (as so redesignated) 
     of section 6 of the Bank Holding Company Act of 1956, as 
     added by section 103(a) of the amendment in the nature of a 
     substitute, insert the following new paragraph:
       ``(7) Sunset of grandfather.--A financial holding company 
     engaged in any activity, or retaining direct or indirect 
     ownership or control of shares of a company, pursuant to this 
     subsection, shall terminate such activity and divest 
     ownership or control of the shares of such company before the 
     end of the 10-year period beginning on the date of the 
     enactment of the Financial Services Act of 1998. The Board 
     may, upon application by a financial holding company, extend 
     such 10-year period by not to exceed an additional 5 years if 
     such extension would not be detrimental to the public 
     interest.
       Strike paragraph (1) of section 10(c) of the Bank Holding 
     Company Act of 1956, as added by section 131(a) of the 
     amendment in the nature of a substitute (and redesignate 
     subsequent paragraphs and any cross reference to any such 
     paragraph accordingly).
       In subparagraph (A) of paragraph (1) (as so redesignated) 
     of section 10(c) of the Bank Holding Company Act of 1956, as 
     added by section 131(a) of the amendment in the nature of a 
     substitute, strike ``paragraph (1)(A) and''.
       In subparagraph (C) of paragraph (1) (as so redesignated) 
     of section 10(c) of the Bank Holding Company Act of 1956, as 
     added by section 131(a) of the amendment in the nature of a 
     substitute, strike ``or (g)''.
       In subparagraph (B) of paragraph (2) (as so redesignated) 
     of section 10(c) of the Bank Holding Company Act of 1956, as 
     added by section 131(a) of the amendment in the nature of a 
     substitute, strike ``Notwithstanding paragraph (1)(A)(i), 
     the'' and insert ``The''.
       In subparagraph (A) of paragraph (3) (as so redesignated) 
     of section 10(c) of the Bank Holding Company Act of 1956, as 
     added by section 131(a) of the amendment in the nature of a 
     substitute, strike ``, (2), or (3)'' and insert ``or (2)''.

  The CHAIRMAN. Pursuant to House Resolution 428, the gentleman from 
Iowa (Mr. Leach) and a Member opposed, each will control 15 minutes.
  The Chair recognizes the gentleman from Iowa (Mr. Leach).
  Mr. LEACH. Madam Chairman, I yield myself such time as I may consume.
  The movement to go beyond the integration of financial services and 
eliminate the traditional legal barriers between commerce and banking 
is simply a bridge we should not cross. It is a course fraught with 
risk and devoid of benefit and one for which there is no justification.
  Such a step would open the door to a vast restructuring of the 
American economy and an abandonment of the traditional role of banks 
and impartial providers of credit, while exposing the taxpayer to 
liabilities on a scale far exceeding the savings and loan bailout. At 
issue with financial services modernization is increased competition. 
At issue with mixing commerce and banking is economic conglomeration, 
the concentration of ownership of corporate America.
  Recognizing this, warnings about mixing commerce and banking have 
been issued by the Federal Reserve Board, by Paul Volcker, and by 
consumer activist Ralph Nader. It is opposed by groups representing 
consumers, labor organizations, community bankers, farmers, travel 
agents, realtors, pharmacists, building contractors and the self-
employed. In other words, the concept is opposed by the millions of 
workers, small businessmen and women who are the generators of economic 
prosperity in the United States.
  Proponents of a commercial basket argue that U.S. financial holding 
companies need a commercial basket to be able to compete with foreign 
competitors, and that virtually all European countries permit banks to 
make direct investments in commercial activities. However, this 
overlooks a couple of simple facts.
  First, in testimony before our committee, Chairman Volcker noted that 
the mixing of commerce and banking in Germany, France, Spain, Japan and 
elsewhere has led to massive financial losses for both banks and 
taxpayers in these countries. There is plenty of recent experience in 
other parts of the world to suggest that potential problems with 
banking-commerce links are not just theoretical, Paul Volcker noted.
  Second, a recent New York Times article indicated that the European 
universal banks have a lower return on equity than U.S. banks, such as 
Citicorp, which does not have a commercial basket. So why would we 
encourage our banks to go in that direction?
  Third, the U.S. financial system has much more depth and credit in 
equity markets. That is one of the strengths of the United States 
system. It thus could not be more ironic that powerful groups in 
Washington are today suggesting that Congress redesign America's 
financial landscape to make it more like that of Japan and Germany, 
France and Spain and the 1980s United States S&L industry.
  Mixing commerce and banking only benefits large banks and large 
corporations at the expense of small banks and small business. For 
decades small business has been the engine of job creation in the 
United States, and mixing banking and commerce places American job 
growth in jeopardy.
  For instance, would an individual hoping to open a restaurant in a 
town where the only bank was owned by McDonald's be able to obtain a 
loan, or would the bank disregard its role as an impartial provider of 
credit? Would a bank owned by a real estate developer

[[Page H3210]]

provide comparably priced credit to competing developers? Given these 
troubling possibilities, it is no surprise that the nonpartisan General 
Accounting Office issued a report demonstrating that there is no 
compelling economic argument for mixing commerce and banking and a lot 
of socioeconomic and political jeopardy in doing so.
  In this time of crisis in Asian economies, the lessons of the 
chaebols of Korea, the keiretzus of Japan and cartels of Indonesia 
should not be lost in the United States. Those who advocate financial 
modernization legislation which mixes commerce and banking might want 
to take a hard look at the conflicts of interest endemic to systems 
that have allowed such mixing.
  In East Asia, bank ownership of industrial firms led to crony 
capitalist relationships with the government. The virtue of America's 
decentralized, stock-market-oriented financial system is that credit 
and investment decisions are made based on economic fundamentals, not 
entangled relationships or corporate favoritism.
  America is a country which has traditionally opposed concentrations 
of power, both political and economic. It is the country of 
Jeffersonian individualism, Jacksonian bank skepticism and Teddy 
Roosevelt trust busting. The contemplated mixture of commerce and 
banking goes beyond the lessons that we have learned and the values 
that we hold.
  Madam Chairman, I reserve the balance of my time.
  Mr. VENTO. Madam Chairman, I rise in opposition to the Leach 
amendment.
  The CHAIRMAN. The gentleman from Minnesota (Mr. Vento) is recognized 
for 15 minutes.
  Mr. VENTO. Madam Chairman, I yield myself 2 minutes.
  Madam Chairman, I rise in opposition to this amendment. This 
amendment, what it actually says, and I respect the chairman and his 
staunch opposition to commerce and banking; he has been consistent in 
that particular view. But what this amendment does is it says, they 
rise in opposition to the Roukema amendment which provides a 10 percent 
basket even for securities, insurance or banking firms, but this one 
says, 10 percent is too much, but 15 percent is just about right.
  That is what this amendment does. This provides 15 percent commerce 
ownership within a securities or insurance firm for 15 years.
  Here we are in an environment in which economic events within a short 
period of time, in days, maybe months, certainly years, in 15 years we 
could see dramatic changes in terms of what happens in the economy. We 
are saying, we are providing a level playing field, taking the most 
important financial entities in our country, banks, and treating them 
in a disparate way. Of course, I mentioned the many, many exceptions.
  Now, in order to sell this particular proposal to the Members, we 
have had the bloody flag of the S&L crisis waved back and forth. It has 
been suggested that somehow our culture and free enterprise system and 
free people are going to accept the type of government and type of 
control that exists in Asia, in Japan or Korea or Germany. I do not 
think so.
  I think that our free enterprise system is strong enough and mature 
enough to recognize what actually is taking place. What happens when 
banks permit the financing for mergers and acquisitions? What happens 
when banks make these tremendous loans and end up collecting these 
companies as collateral? They become, in a sense, investors. They end 
up picking up that collateral and having that control. And there are 
many, many exceptions. In fact one of the largest corporations in my 
State, 3M owns a bank. It has not undercut 3M yet. They are still going 
to the private market.
  I oppose this amendment.
  Madam Chairman, I reserve the balance of my time.
  Mr. LEACH. Madam Chairman, I yield 3 minutes to the gentleman from 
California (Mr. Campbell).
  Mr. CAMPBELL. Madam Chairman, it is a compliment to the side of the 
argument presented by the chairman of the committee that those opposing 
his amendment would say that it allows 15 percent commercial investment 
to continue, as though they realize what danger it is to allow such 
mixture of commerce and banking.
  Let me at the start put to rest this argument. The 15 percent that 
would be allowed to continue for the bank holding company during the 
period of a wind-down is in order to allow a reasonable phaseout of the 
mixture of banking and commerce that is already in existing law.
  The fundamental debate here tonight is between those who wish to go 
to zero mixing of commerce and banking and those who would permit it, 
those who believe that 5 percent mixture is not enough and, in the 
Roukema amendment, that it be 10, or as we heard in the debate earlier, 
that some would even go to 15.
  I think the real debate thus is, shall we have a mixture of commerce 
and banking? Admittedly, the Leach amendment, of which I am proud to be 
a cosponsor, has a phaseout provision. That is appropriate for now. 
Eventually, however, under the Leach amendment there will be no mixture 
of commerce and banking, as there should be no mixture of commerce and 
banking.
  Under the Roukema amendment, it will be 10 percent today, probably 15 
percent or 20 in years to come.
  What is the objection to the mixture? I think it has been adequately 
explained by my colleagues in regard to the risk that comes from a 
commercial investment made by someone that ought to be a neutral 
provider of capital. I would rather address one point that has not been 
made, and that is whether the fire walls are adequate, because we know 
that in the bill itself and in the amendment from our colleague, the 
gentlewoman from New Jersey (Mrs. Roukema), there is a set of fire 
walls to make sure that the bank does not offer a loan to the very 
commercial enterprise in which it has an equity stake.
  But there is no fire wall against providing a loan to the customers 
of that commercial enterprise or to the suppliers of that commercial 
enterprise. And so a bank might own some stock in General Motors, and 
General Motors cannot get its new fleet out on time because Firestone 
has a little trouble providing the tires, due to cash flow. Will the 
bank not be tempted to give a little bit of leniency on any loan to 
Firestone? It would not break any fire wall to do so because the fire 
wall only applies as to the extension of credit to General Motors, if, 
by hypothesis, the bank has an equity stake in General Motors.
  The point is simple, there is no way that the imagination of 
humankind can prevent the temptation from arising. If a bank has an 
equity stake in an enterprise, that enterprise will have a claim on the 
bank's lending policy.
  Lastly, why do we care so much? Because it is not the companies' 
money. I have no problem with the company retaining earnings and using 
it for its own intended investment--splendid, but not with the 
taxpayers' money. What we are dealing with here tonight is Bank 
Insurance Fund money which, if the Bank Insurance Fund is stressed, 
will, as in the case of the savings and loan crisis, and will, in this 
context again, be a tax upon the taxpayers.

                              {time}  1830

  Mr. VENTO. Madam Chairman, I yield 2 minutes to the gentleman from 
Texas (Mr. Paul), a member of the committee.
  (Mr. PAUL asked and was given permission to revise and extend his 
remarks.)
  Mr. PAUL. Madam Chairman, I rise in opposition to the Chairman's 
amendment and in strong support of the amendment of the gentlewoman 
from New Jersey.
  There are two positions that one could take on this. We could have 
zero integration, which this amendment would do; or we could think 
about the market. The market would just allow it to exist.
  Earlier, somebody quoted Hamilton as being opposed to an integration 
of commerce in banking. Well, of course, at that particular time in 
history we had the Jeffersonians, and they were strongly in support of 
the market and even against central banking.
  So I think, considering all things, that I cannot get my 100 percent, 
and we certainly do not want zero. We need to move in a direction, so I 
would say this very modest request is very justified.
  I think this FDIC insurance is something we should be concerned 
about,

[[Page H3211]]

but that is a different issue for the moment. I object to that, but I 
do not believe this will solve the FDIC problem.
  We have to think about how we got here. In the 1920s, the Federal 
Reserve created a lot of credit. They created a boom and a booming 
stock market and good times. Then the Federal Reserve raised the 
interest rates and there was a stock market crash and a depression. And 
out of the depression came the desire to regulate banking and commerce. 
That caused the depression, which was erroneous, because the cause of 
the depression was excessive credit and then a deflated bubble, which 
should be all laid at the doorstep of the Federal Reserve.
  This is the size of the Glass-Steagall Act, a few pages, in order to 
solve a problem that did not exist. But we have been living with this 
for all these years. And now, over these several years, we have been 
trying to solve the problem. Now, this is the size of the solution. 
This is H.R. 10, this is the version of the Committee on Commerce as 
well as the version of the Committee on Banking and Financial Services 
that went to the Committee on Rules.
  We need to look at the fundamental cause of our problems and not jump 
off a cliff and do the wrong thing. I strongly support the Roukema 
amendment.
  Mr. LEACH. Madam Chairman, I yield 3 minutes to the gentleman from 
Nebraska (Mr. Bereuter), my distinguished friend and coauthor of the 
amendment.
  (Mr. BEREUTER asked and was given permission to revise and extend his 
remarks.)
  Mr. BEREUTER. Madam Chairman, I thank the gentleman for yielding this 
time to me.
  The gentleman from Texas has just spoken to us about letting the 
market work. The problem with the mixing of commerce and banking is 
that market decisions are not made. Credit decisions are made on the 
basis of equity that a bank has in a business. We are more likely to 
have the market working properly when we have this division between 
banking and commerce as we have had since the 1930s, even tracing far 
back beyond that, as the gentleman from Massachusetts (Mr. Markey) 
earlier said, tracing back in some form to a period even before the 
founding of the Republic.
  I just cannot help but think of what happened in the home State of 
the gentleman from Texas (Mr. Paul) when we had under S&L law in Texas, 
in that State and some other States, an opportunity under their 
legislation to use federally insured deposits to make investments in 
their own name instead of loans to residents of their community. And I 
recall something like 50 percent of the total losses in the S&L debacle 
were in the gentleman's home State of Texas.
  The gentleman from Minnesota (Mr. Vento) suggests that this 10 
percent basket is a modest step. Well, I think we are more likely to 
pay attention to what the gentleman from New York (Mr. Engel) said. He 
said this 10 percent basket is a reasonable first step as a basket. And 
that is the point this gentleman was trying to make some time ago; that 
there is, in fact, no end to this process for a larger basket all the 
time once we break the barrier down between commerce and banking. We 
are going to be back here with such amendments year after year.
  Mr. VENTO. Madam Chairman, will the gentleman yield?
  Mr. BEREUTER. I yield to the gentleman from Minnesota.
  Mr. VENTO. I wanted to suggest that I did not agree with the 
gentleman from New York (Mr. Engel) on the first step.
  Mr. BEREUTER. I thank the gentleman for that clarification.
  I watch with awe and wonder the gentleman from New York (Mr. 
LaFalce), who speaks to us in such a soothing voice, about how the 
changes that are being made here are actually reducing it from 15 
percent basket to 10 percent basket. And, well, that is accurate. But 
in reality, of course, the status quo is a zero basket. And that is 
what we are supportive of the Leach amendment think is a crucial and 
proper level. It is crucial that we maintain this barrier against 
mixing banking and commerce. I think it provides us a much higher 
likelihood of the impartial provision of credit by bankers to people 
and to businesses that deserve to receive credit. It avoids a 
concentration of economic power.
  Earlier, too, we heard references about a bloody flag being waived in 
the debate on S&Ls. But I think that is appropriate for we have to 
learn from our experience. And it boggles my mind, it boggles foreign 
legislators' minds that we in America would be recreating, the kind of 
unhealthy banking situations that we find in Asian countries.
  And as the gentlewoman from New Jersey (Mrs. Roukema) ask earlier, 
well, what about Europe? Well, in fact, the problems resulting from the 
mix of commerce and banking exists in Europe, too. And, in fact, in 
France and Spain the public treasuries were raided to make insolvent 
large banks more solvent after they made imprudent commercial 
investments. And that is what we would have to have.
  Do not trade the separate American banking and commercial systems for 
the failures of Asia or Europe.
  Mr. VENTO. Madam Chairman, I yield 3 minutes to the gentleman from 
Texas (Mr. Bentsen).
  Mr. BENTSEN. Madam Chairman, I thank the gentleman for yielding me 
this time.
  This is, no question, a very difficult issue. I can come down almost 
on either side. But if we do not deal with it tonight, and my bet is we 
probably are not going to deal with it tonight, we are going to have to 
deal with it at some point in the future.
  Again, I have nothing but the greatest respect for the chairman of 
the Committee on Banking and Financial Services, and I think he has 
thought long and hard about this, but we have to consider a few things.
  First of all, the chairman talked really about two types of 
commercial baskets. I think he talked about what this amendment or the 
Roukema amendment was about, and then he talked about what he thinks 
may come in the idea of a reverse basket where McDonald's owns banking 
entities around the country.
  Of course, we already have a system in place where we have the small 
town banker that owns the bank and the car dealership and the feed 
store and everything else, and that is allowed under current law. But I 
think we also have to remember we have a much more dynamic marketplace.
  And that leads into my second point. It is not really fair to compare 
the United States' economy to that of Asia or even Europe. Our market 
is much more sophisticated. It is much more diversified. Our capital 
and credit markets are much more diversified, much more efficient, much 
larger. So, yes, there may well be risk, but I think it is a very 
unfair comparison to make.
  I think that the gentleman uses the example of the German company and 
Enron, which happens to be based in my home city of Houston, and how 
efficient the U.S. market, the stock market treats it, and I think that 
is true with respect to banks.
  We could turn this over to Mr. Greenspan and let him write the entire 
bill and just rubber stamp it when it gets back over here and let him 
go on with his business. I think that would be inappropriate. But what 
I think Mr. Greenspan and the former chairman, Mr. Volcker, said, when 
they testified before the committee, is getting back to the real crux 
of the issue, which is, well, we are opening the door a little bit and 
it is going to get broader.
  But herein lies the problem. Because, as the chairman knows, we are 
going to find, and we are finding it now, that where banks, as they 
become stronger, are going to get into areas which are not financial in 
nature, whether it is data processing or others, that have to be part 
of their function to be competitive. And we are going to have to 
address this problem. If we do not address it tonight, we will be 
addressing it down the road very shortly, I believe.
  So I think the chairman has thought a lot about his amendment, I 
appreciate what he has to say about it, but I think we ought to defeat 
it and support the amendment of the gentlewoman from New Jersey.
  Mr. LEACH. Madam Chairman, I yield 1 minute to the distinguished 
gentleman from California (Mr. Campbell), who is also a coauthor of the 
amendment.
  Mr. CAMPBELL. Madam Chairman, I asked for the additional time just to 
stand in defense of the free market. Our good friend and colleague the 
gentleman from Texas (Mr. Paul) spoke on

[[Page H3212]]

behalf of the free market, and it is hard to beat him when he speaks on 
behalf of the free market, but I am not weak in my own right in terms 
of defending the free market--on this floor, and in our Committee on 
Banking and Financial Services.
  I say people should do whatever they want with their own money. If 
they want to have a commercial enterprise and a bank and an insurance 
company and a real estate company, may God bless them. May they succeed 
and prosper in America, the greatest economy in the world, but on their 
own dime. But, if they have access to the Federal tax dollar through 
the FDIC, its successor, the Bank Insurance Fund, then no, sir, no, 
ma'am. I want to make sure they are restricted with what they do when 
taxpayers' funds are at risk. I want to make sure they are careful.
  And do not tell me it will not happen. I came to this Congress in 
1989. I joined the Committee on Banking and Financial Services, and the 
thrift crisis happened. I hope no one suggests causality in that order 
of events. But let me say to my colleagues there were people telling me 
I should not worry; that the thrifts were safe; savings and loans could 
not be better. And we ended up, we the taxpayers, paying for it.
  I'm for the free market--on their own dime, but not on the taxpayers.
  Mr. VENTO. Madam Chairman, I yield 2\1/2\ minutes to the gentlewoman 
from New Jersey (Mrs. Roukema).
  Mrs. ROUKEMA. Madam Chair, I thank my colleague for yielding me this 
time.
  I do not know where to begin here. There have been so many strawmen 
and exceptions to prove the rule thrown out here that it is really a 
little difficult to answer. But I do want to say to my colleagues, let 
us be very sure. This is not the time of Jefferson or Hamilton. It is 
not even the time of Teddy Roosevelt. We are in modern times with 
technological changes that are so fast pace we can hardly absorb them, 
and in global market places. And that is the reality of what we are 
trying to do here.
  Now, I secondly want to point out that, with all due respect to my 
good friend and colleague, the chairman of the committee, and my other 
good friend and colleague, the gentleman from Nebraska (Mr. Bereuter), 
my colleague on the committee, we have worked long and hard on lots of 
different issues, but with all due respect we cannot be making these 
parallels between Southeast Asia and what we are proposing here with a 
10 percent commercial basket with the kinds of regulatory reforms and 
fire walls and structures that we have in place in this bill.
  This is not Japan, South Korea or Indonesia. It is not unlimited 
investment, as those countries have. It is a 10 percent basket. Also, 
we do not have a situation where banks lend to only certain companies. 
We also do not have the family connection things of those foreign 
countries. Banks in the United States are generally examined annually, 
and we have the generally accepted accounting principles and stricter 
requirements. The foreign banks do not have this.
  I could go on and on. In fact, I will, in one more respect. U.S. bank 
transactions with affiliates are subject to the protections, and under 
this bill would continue to be subject to the protections of 23(a) and 
23(b) of the Federal Reserve Act. And this is very important because it 
is specific to how you cannot make these gross comparisons that are 
being made. The restrictions on the amount of loans a bank can make to 
their affiliates, and requires fair deal for all, not giving better 
deals to any one particular affiliate. There are all kinds of 
distinctions in this bill.
  We are making a modest step forward and one that I believe any 
objective observer would say get with the program, figure out a 
regulatory structure that would accommodate so that we can compete with 
virtually every other of the successful European countries with whom we 
are competing.
  Mr. LEACH. Madam Chair, I yield myself such time as I may consume.
  First, let me talk about competition. In case no one has noticed, 
over the last 2 decades the United States of America has outstripped 
competitively virtually every Western European country. We organize 
differently than Europe. We decentralize.
  In case nobody has noticed, the last 7 years Japan has averaged about 
1 percent growth. The United States 2 to 4 times the rate of growth in 
each of these years in Japan. We organize differently.
  In terms of speed, in very short order, very large things can occur. 
We have just witnessed announcement in the last 4 or 5 weeks of the 
largest financial combination in American history. Reports after the 
fact indicate that the leadership of the two institutions involved, 
Travelers and Citicorp, reached a decision in a 6 to 7 week time frame.
  As financial institutions grow, these percentage restraints grow with 
them. So we have a circumstance that the larger financial institutions 
become, the larger the commercial enterprises they can intertwine with. 
In very, very short order the American commercial landscape as well as 
financial landscape can change if this kind of approach is adopted.
  Finally, let me just note that in addition to concentration of 
ownership that can occur, we are likely to get a concentration of 
geographic control.

                              {time}  1845

  It simply is a fact that most large enterprises are not located in 
rural areas. It simply is a fact that people in what are called money 
center areas are more mobile with large sums of capital than people who 
are not.
  And so, in very short order, if one goes ahead with an approach that 
authorizes the mixing of banking and commerce, one can see a 
concentration of ownership grow in this country and one can see a 
geographic concentration of that ownership come to be of rather telling 
dimensions.
  So I would simply urge this Congress to note that, other than some 
very large interest groups, I know of no one that advocates this 
approach. I have never in my time in public life gotten a letter that 
has said, ``What ails America is that Chase Manhattan and General 
Motors are not combined.'' I have never gotten a letter that says, 
``What we need are larger enterprises, not from growth within but from 
conglomeration.'' And I just suspect that if the American public 
thought this through, there is not only lack of majority support, there 
is lack of any support other than a very, very few very, very wealthy 
people.
  So I would urge restraint.
  Mr. BEREUTER. Madam Chairman, will the gentleman yield?
  Mr. LEACH. I yield to the gentleman from Nebraska.
  Mr. BEREUTER. The Chairman is exactly right about the small number of 
entities, if any, that are supportive of it. There are a handful of 
firms and banks. But on the other side, perhaps it is good to reiterate 
the people that are in favor of the Leach amendment, maintaining the 
status quo of the zero basket. The chairman has mentioned a few of them 
before.
  Mr. VENTO. Madam Chairman, I yield myself 1\1/2\ minutes.
  I wanted to point out that the Leach proposal has a 15 percent basket 
for securities and insurance firms. And what I presume that means, the 
way it operates, is that until the year 2013, for 15 years, they could 
have that 15 percent basket of equity position. They then could go, 
under this Glass-Steagall provision, and buy banks, buy insurance 
firms, and maintain 15 percent equity ownership. So it boggles the 
mind.
  I understand that we are against commerce and banking, except that 
this particular configuration until the year 2013 would prevail. In my 
judgment, it is an untenable position in terms of what is going on. As 
I listen to the debate here, I wonder if really we are prepared, or the 
proponents of this amendment are prepared, to really repeal the Glass-
Steagall amendment. Because they seem to have learned no lessons or 
recognized no difference between the fact that we are not able to 
distinguish some of the instruments of these financial entities; that 
in fact the banks write two-thirds of the derivatives, that the types 
of loan programs that they are involved in, I think very often look 
like investments. The inconsistency of this in this particular bill, in 
the marketplace, it seems that they are in a state of denial, quite 
frankly.
  I am just amazed at the vehemence in terms of this particular 
position. And then to compare us to Germany and Japan and other 
countries where

[[Page H3213]]

they do not have a regulatory system, a culture, and a free enterprise 
system as we have. I must state again, this is not my first step. This 
is just a recognition to get out there and regulate it.
  Madam Chairman, I yield 1 minute to the gentleman from Nebraska (Mr. 
Bereuter).
  Mr. BEREUTER. Madam Chairman, I just wanted to point out to the 
gentleman from Minnesota (Mr. Vento) regarding the grandfathering 
arrangement, it is a 10-year period. It could be extended for five 
years. But this is dealing with an anomalous situation. It is a 
condition created by regulators because the Congress did not act 
earlier. These anomalous conditions are not a good situation, but the 
grandfather clause is a valuable way to remedy these anomalous 
situations.
  Mr. VENTO. Reclaiming my time, I understand. I think the gentlemen 
are being very fair. Except it just becomes very inconsistent in terms 
of what the effect is. It just becomes unworkable and it is untenable 
to present a bill like this where we have such an unlevel playing 
field; and to criticize 10 percent at the same time they are providing 
15 percent here just boggles the mind.
  Madam Chairman, I yield 3 minutes to the gentleman from Louisiana 
(Mr. Baker), a distinguished member of the Committee on Banking and 
Financial Services.
  Mr. BAKER. Madam Chairman, I thank the gentleman for yielding the 
time.
  I certainly want to acknowledge the hard work that the gentleman from 
Iowa (Mr. Leach) has given in the difficult management of H.R. 10 
throughout not just this session, but many years.
  However, this is one issue where the chairman and I have had 
significant differences of legitimate opinion as to the appropriateness 
of diversified financial structures. If we were to adopt the zero 
parity amendment that is proposed by this amendment, we would find 
significant dislocations in the current marketplace. There would be 
corporations and entities legally engaged in businesses which they have 
engaged in for many years which would, of necessity, have to divest 
those revenue streams from their corporate structure. Stated another 
way, people lawfully engaged in business that does no harm would now, 
by action of this Congress, be told they can do that no more.
  That, to me, seems to be a bit unreasonable, especially when we 
realize that one of the important elements this amendment does not 
address is the structure of the unitary thrift, which will continue to 
exist and proliferate, which may be resold without limit in which one 
cannot only have nonfinancial income, they can own a plywood plant, a 
hotel, a restaurant, and a thrift.
  Mr. VENTO. Madam Chairman, if the gentleman will yield, there is no 
10 percent limit in there. There could be a 100 percent.
  Mr. BAKER. That is correct. The gentleman makes the point that there 
is no revenue limit at all with regard to the unitaries that can be 
sold to commercial enterprises, so that a General Motors can get into 
the thrift business by accessing that charter. This amendment does not 
address that question.
  And so what we have left at the end of consideration if this 
amendment were to prevail is a very unbalanced marketplace where a few 
authorized actors have the right to have very diverse incomes, while we 
are taking banks and financial enterprises down to zero level and 
requiring them to divest themselves of currently legally authorized 
activities.
  When we look at those currently authorized institutions that have 
significant activity, American Express, for example, enjoys 9 to 14 
percent of revenue annually coming from nonfinancial related 
activities. We see A.G. Edwards, Charles Schwab, Lehman Brothers, we 
can go down the list and look at what is going on in the market today 
and realize the consequences of this amendment are not minor.
  Now, I certainly understand the proponents' perspective that we 
should not allow commercial and financial interests to intermingle. But 
I have to tell my colleagues, smart people are figuring out ways to do 
that no matter what the Congress might attempt to limit.
  This is a very serious amendment. It is a very thoughtful amendment. 
It is a very important amendment. But it is a disaster for the existing 
financial marketplace of this country if it were to be adopted.
  Mr. TOWNS. Madam Chairman, I rise in opposition to the amendment 
offered by the gentleman from Iowa.
  The five percent commercial basket contained in H.R. 10 recognizes 
that the securities industry has a long, troublefree history or 
affiliation with commercial companies. In fact, there are instances in 
which securities firms have benefitted greatly from the capital a 
commercial affiliate has contributed. Additionally, allowing financial 
holding companies (F.H.C.s) to invest a percentage of their domestic 
gross revenues in non-financial activities will provide companies with 
a source of capital and will help F.H.C.s.
  The Commerce Committee reported out this with a 5% commercial basket. 
The Banking Committee passed a 15% commercial basket amendment by a 35 
to 19 vote. At no point did either committee say that there should be 
no commercial basket. Modernization legislation can not continue the 
status quo. This bill must reflect the current market and permit some 
form of commercial affiliation. Therefore, I would urge my colleagues 
to oppose this amendment and to support the gentlelady's from New 
Jersey's amendment to increase the commercial basket to 10%.
  The CHAIRMAN. All time has expired.
  The question is on the amendment offered by the gentleman from Iowa 
(Mr. Leach) as a substitute for the amendment offered by the 
gentlewoman from New Jersey (Mrs. Roukema).
  The question was taken; and the Chairman announced that the ayes 
appeared to have it.
  Mr. VENTO. Madam Chairman, on that I demand a recorded vote, and 
pending that I make the point of order that a quorum is not present.
  The CHAIRMAN. Pursuant to House Resolution 428, further proceedings 
on the substitute amendment offered by the gentleman from Iowa (Mr. 
Leach) will be postponed.
  The point of no quorum is considered withdrawn.
  It is now in order to consider amendment No. 7 printed in part 2 of 
House Report 105-531.


                Amendment No. 7 Offered by Mr. Kingston

  Mr. KINGSTON. Madam Chairman, I offer an amendment.
  The CHAIRMAN. The Clerk will designate the amendment.
  The text of the amendment is as follows:

       Amendment No. 7 offered by Mr. Kingston:
       After section 108 of the Amendment in the Nature of a 
     Substitute, insert the following new section (and conform the 
     table of contents accordingly):

     SEC. 109. GAO STUDY OF ECONOMIC IMPACT ON COMMUNITY BANKS AND 
                   OTHER SMALL FINANCIAL INSTITUTIONS.

       (a) Study Required.--The Comptroller General of the United 
     States shall conduct a study of the projected economic impact 
     that the enactment of this Act will have on financial 
     institutions which have total assets of $100,000,000 or less.
       (b) Report to the Congress.--The Comptroller General of the 
     United States shall submit a report to the Congress before 
     the end of the 6-month period beginning on the date of the 
     date of the enactment of this Act containing the findings and 
     conclusions of the Comptroller General with regard to the 
     study required under subsection (a) and such recommendations 
     for legislative or administrative action as the Comptroller 
     General may determine to be appropriate.

  The CHAIRMAN. Pursuant to House Resolution 428, the gentleman from 
Georgia (Mr. Kingston) and a Member opposed each will control 5 
minutes.
  The Chair recognizes the gentleman from Georgia (Mr. Kingston).
  Mr. KINGSTON. Madam Chairman, I yield myself such time as I may 
consume.
  This amendment is a very simple one. It simply says that after 6 
months of enactment of this legislation that a study will be done on 
institutions with $100 million or less in assets to see how House 
Resolution 10 impacts them, and it requires the Comptroller of the 
Currency to conduct that study and just to be sure that our smaller 
financial institutions, usually community banks, see if they are 
negatively impacted by it.
  It is not second-guessing the bill as much as it is saying the bill 
may not be perfect, there may be some unintended consequences that 
affect the bill if it is passed without this amendment. So all we are 
trying to do is say, let us take a look at it, let us make

[[Page H3214]]

sure that things are working as they are intended to work, and let us 
get that report back to Congress.
  Mr. BLILEY. Madam Chairman, will the gentleman yield?
  Mr. KINGSTON. I yield to the gentleman from Virginia.
  Mr. BLILEY. Madam Chairman, we have looked at the amendment. We think 
it is a good amendment, and we are prepared to accept it.
  Mr. LEACH. Madam Chairman, will the gentleman yield?
  Mr. KINGSTON. I yield to the gentleman from Iowa.
  Mr. LEACH. Madam Chairman, in my view, it is a very thoughtful 
amendment. We are very appreciative that the gentleman has offered it, 
and I hope it will be adopted.
  Mr. KINGSTON. Reclaiming my time, I appreciate that.
  Mr. LaFALCE. Madam Chairman, will the gentleman yield?
  Mr. KINGSTON. I yield to the gentleman from New York.
  Mr. LaFALCE. Madam Chairman, I concur in the judgments of the 
gentleman from Virginia (Mr. Bliley) and the gentleman from Iowa (Mr. 
Leach).
  Mr. KINGSTON. Madam Chairman, I appreciate that, and I yield back the 
balance of my time.
  The CHAIRMAN pro tempore (Mr. Nussle). The question is on the 
amendment offered by the gentleman from Georgia (Mr. Kingston).
  The question was taken; and the Chairman pro tempore announced that 
the ayes appeared to have it.
  Mr. KINGSTON. Mr. Chairman, on that I demand a recorded vote, and 
pending that, I make the point of order that a quorum is not present.
  The CHAIRMAN pro tempore (Mr. Nussle). Pursuant to House Resolution 
428, further proceedings on the amendment offered by the gentleman from 
Georgia (Mr. Kingston) will be postponed.
  It is now in order to consider Amendment No. 8 printed in part 2 of 
House Report 105-531.


                Amendment No. 8 Offered by Mrs. Roukema

  Mrs. ROUKEMA. Mr. Chairman, I offer an amendment.
  The CHAIRMAN pro tempore. The Clerk will designate the amendment.
  The text of the amendment is as follows:

       Amendment No. 8 offered by Mrs. Roukema:
       After subtitle H of title I, insert the following new 
     subtitle (and redesignate the subsequent subtitle and conform 
     the table of contents accordingly):

                  Subtitle I--Deposit Insurance Funds

     SEC. 186. STUDY OF SAFETY AND SOUNDNESS OF FUNDS.

       (a) Study Required.--The Board of Directors of the Federal 
     Deposit Insurance Corporation shall conduct a study of the 
     following issues with regard to the Bank Insurance Fund and 
     the Savings Association Insurance Fund:
       (1) The safety and soundness of the funds and the adequacy 
     of the reserve requirements applicable to the funds in light 
     of--
       (A) the size of the insured depository institutions which 
     are resulting from mergers and consolidations since the 
     effective date of the Riegle-Neal Interstate Banking and 
     Branching Efficiency Act of 1994; and
       (B) the affiliation of insured depository institutions with 
     other financial institutions pursuant to this Act and the 
     amendments made by this Act.
       (2) The concentration levels of the funds, taking into 
     account the number of members of each fund and the geographic 
     distribution of such members, and the extent to which either 
     fund is exposed to higher risks due to a regional 
     concentration of members or an insufficient membership base 
     relative to the size of member institutions.
       (3) Issues relating to the planned merger of the funds, 
     including the cost of merging the funds and the manner in 
     which such costs will be distributed among the members of the 
     respective funds.
       (b) Report Required.--
       (1) In general.--Before the end of the 9-month period 
     beginning on the date of the enactment of this Act, the Board 
     of Directors of the Federal Deposit Insurance Corporation 
     shall submit a report to the Congress on the study conducted 
     pursuant to subsection (a).
       (2) Contents of report.--The report shall include--
       (A) detailed findings of the Board of Directors with regard 
     to the issues described in subsection (a);
       (B) a description of the plans developed by the Board of 
     Directors for merging the Bank Insurance Fund and the Savings 
     Association Insurance Fund, including an estimate of the 
     amount of the cost of such merger which would be borne by 
     Savings Association Insurance Fund members; and
       (C) such recommendations for legislative and administrative 
     action as the Board of Directors determines to be necessary 
     or appropriate to preserve the safety and soundness of the 
     deposit insurance funds, reduce the risks to such funds, 
     provide for an efficient merger of such funds, and for other 
     purposes.
       (c) Definitions.--For purposes of this section, the 
     following definitions shall apply:
       (1) Insured depository institution.--The term ``insured 
     depository institution'' has the meaning given to such term 
     in section 3(c) of the Federal Deposit Insurance Act.
       (2) Bif and Saif members.--The terms ``Bank Insurance Fund 
     member'' and ``Savings Association Insurance Fund member'' 
     have the meaning given to such terms in section 7(l) of the 
     Federal Deposit Insurance Act.

  The CHAIRMAN pro tempore. Pursuant to House Resolution 428, the 
gentlewoman from New Jersey (Mrs. Roukema) and a Member opposed each 
will control 5 minutes.
  The Chair recognizes the gentlewoman from New Jersey (Mrs. Roukema).
  Mrs. ROUKEMA. Mr. Chairman, I will not take the 5 minutes.
  This is a very direct and straightforward amendment, and I believe 
that it can easily be understood. It simply asks for a study to be 
done. It requires that the FDIC conduct a study regarding the two 
deposit insurance funds, the Bank Insurance Fund and the Savings 
Association Insurance Fund, the SAIF.
  The FDIC, under this study amendment, would look at the number of 
institutions in each fund and the risk posed by the concentration of 
deposits in those individual institutions or in certain regions of the 
country. The FDIC would be required to address how the funds might be 
merged and how long such a merger would be taken into effect and how 
such a merger would be paid for if there were extenuating costs 
circumstances. The FDIC would be required to file a written report with 
the Congress within 9 months after enactment.
  I think, Mr. Chairman, those of us that have been working on this 
issue over the years have understood that originally there was a 
central element of the bill that was going to require integration of 
the funds, of the deposit insurance funds, and we dropped that because 
we felt that we did not quite know enough about the costs and how they 
would be allocated and whether or not indeed there would be enough 
capital in those deposits.

                              {time}  1900

  So I think that this is the better part of valor so that we cannot 
abandon the complications of the BIF SAIF implications as we have known 
them, but I think it gives us an intelligent useful way to take our 
time, go about it, and know the complexities of it, not only 
nationwide, but on a regional basis. I think this will serve us well.
  Mr. BLILEY. Mr. Chairman, will the gentlewoman yield?
  Mrs. ROUKEMA. I am happy to yield to the gentleman from Virginia.
  Mr. BLILEY. Mr. Chairman, we have read the amendment. We think it is 
a good amendment, and we would support the amendment.
  Mr. LEACH. Mr. Chairman, will the gentlewoman yield?
  Mrs. ROUKEMA. I yield to the gentleman from Iowa, the chairman of the 
Committee on Banking and Financial Services.
  Mr. LEACH. Mr. Chairman, again, I think this is a very thoughtful 
amendment, and I am delighted the gentlewoman has brought it to the 
attention of the House and urge its adoption.
  Mr. LaFALCE. Mr. Chairman, will the gentlewoman yield?
  Mrs. ROUKEMA. I yield to the gentleman from New York.
  Mr. LaFALCE. Mr. Chairman, I would concur in the judgments of the 
gentleman from Virginia (Mr. Bliley) and the gentleman from Iowa (Mr. 
Leach).
  Mr. Chairman, this amendment would require the FDIC to produce a 
study on the BIF and SAIF Funds within 9 months of the date of 
enactment.
  The Study would focus on concentration in the two funds. The FDIC 
would look at the number of banks or savings associations in the 
particular fund. They would tell us if concentration in terms of the 
percentage of deposits, number of institutions or regional 
concentration pose any Safety and Soundness Concerns.
  The FDIC would also report on how it will merge the two funds, how 
long it will take, the expected cost and how the costs would be divided 
among the members of the Deposit Insurance Funds.

[[Page H3215]]

  Mr. Chairman, many of the members of the Banking Committee are 
worried about the deposit insurance funds. With respect to the SAIF--
which insures savings associations--the largest savings association in 
the United States--Washington Mutual--accounts for over 11% of the 
deposit which are insured by the SAIF. They are based primarily on the 
West Coast of the United States. We are particularly concerned about 
the concentration of savings association deposits on the West Coast.
  With respect to the bank insurance fund, the recent merger of 
NationsBank and BankAmerica raises a smaller, but similar, issue. The 
combined bank will hold roughly 8.6% of the deposits which are insured 
by the BIF. We are not quite as concerned about regional concentration 
with respect to the BIF as we are with the SAIF.
  The FDIC has said in recent testimony before the House Banking 
Committee that they would like to have the insurance funds merged. 
Several members, including Mr. McCollum and myself, are very concerned 
about concentration also, and would like to see the funds merged.
  I believe we should not prejudge the situation but request a report 
which will form the basis for further Congressional Action.
  The CHAIRMAN pro tempore (Mr. Nussle). Is there a Member who rises in 
opposition to the amendment from the gentlewoman from New Jersey?
  Seeing none, the question is on the amendment offered by the 
gentlewoman from New Jersey (Mrs. Roukema).
  The question was taken; and the Chairman pro tempore announced that 
the ayes appeared to have it.
  Mrs. ROUKEMA. Mr. Chairman, I demand a recorded vote.
  The CHAIRMAN. Pursuant to House Resolution 428, further proceedings 
on the amendment offered by the gentlewoman from New Jersey (Mrs. 
Roukema) will be postponed.


          Sequential Votes Postponed In Committee Of The Whole

  The CHAIRMAN pro tempore. Pursuant to House Resolution 428, 
proceedings will now resume on those amendments on which further 
proceedings were postponed in the following order: Substitute amendment 
No. 6 offered by the gentleman from Iowa (Mr. Leach), amendment No. 5 
offered by the gentlewoman from New Jersey (Mrs. Roukema), amendment 
No. 7 offered by the gentleman from Georgia (Mr. Kingston), and 
amendment No. 8 offered by the gentlewoman from New Jersey (Mrs. 
Roukema).
  The Chair will reduce to 5 minutes the time for any electronic vote 
after the first vote in this series.


                  Amendment No. 6 Offered by Mr. Leach

  The CHAIRMAN pro tempore. The pending business is the demand for a 
recorded vote on amendment No. 6 offered by the gentleman from Iowa 
(Mr. Leach) as a substitute for amendment No. 5 offered by the 
gentlewoman from New Jersey (Mrs. Roukema) on which further proceedings 
were postponed and on which the ayes prevailed by voice vote.
  The Clerk will redesignate the amendment.
  The Clerk redesignated the amendment.


                             Recorded Vote

  The CHAIRMAN pro tempore. A recorded vote has been demanded.
  A recorded vote was ordered.
  The vote was taken by electronic device, and there were--ayes 229, 
noes 193, not voting 10, as follows:

                             [Roll No 146]

                               AYES--229

     Abercrombie
     Aderholt
     Andrews
     Archer
     Bachus
     Baesler
     Baldacci
     Ballenger
     Barr
     Barrett (NE)
     Barrett (WI)
     Barton
     Bass
     Becerra
     Bereuter
     Berman
     Berry
     Bilirakis
     Bishop
     Blagojevich
     Bliley
     Blunt
     Boehlert
     Bonilla
     Bonior
     Borski
     Boswell
     Boyd
     Brady
     Calvert
     Camp
     Campbell
     Canady
     Cannon
     Cardin
     Chabot
     Chambliss
     Chenoweth
     Clement
     Coble
     Coburn
     Collins
     Combest
     Condit
     Conyers
     Cooksey
     Costello
     Cox
     Cramer
     Crane
     Crapo
     Cubin
     Cummings
     Danner
     Davis (VA)
     Deal
     DeFazio
     Delahunt
     Diaz-Balart
     Dicks
     Dixon
     Doolittle
     Duncan
     Edwards
     Ehlers
     Emerson
     Ensign
     Evans
     Ewing
     Fawell
     Filner
     Fowler
     Fox
     Franks (NJ)
     Frelinghuysen
     Gallegly
     Ganske
     Gejdenson
     Gephardt
     Gibbons
     Gilchrest
     Gillmor
     Gilman
     Goode
     Goodling
     Goss
     Graham
     Gutierrez
     Gutknecht
     Hamilton
     Hansen
     Hastings (WA)
     Herger
     Hilleary
     Hinchey
     Hinojosa
     Hobson
     Horn
     Hostettler
     Houghton
     Hoyer
     Hulshof
     Hutchinson
     Hyde
     Inglis
     Istook
     Jackson (IL)
     Jenkins
     John
     Johnson (CT)
     Johnson (WI)
     Kanjorski
     Kaptur
     Kasich
     Kennedy (MA)
     Kennedy (RI)
     Kildee
     Kim
     Kingston
     Kleczka
     Klug
     Kolbe
     Kucinich
     Latham
     Leach
     Lewis (CA)
     Lipinski
     LoBiondo
     Lofgren
     Lucas
     Luther
     Maloney (NY)
     Manzullo
     Markey
     Martinez
     Matsui
     McCarthy (MO)
     McCrery
     McDade
     McDermott
     McHugh
     McInnis
     McIntosh
     McIntyre
     McKeon
     Menendez
     Metcalf
     Mica
     Millender-McDonald
     Miller (CA)
     Miller (FL)
     Minge
     Moran (KS)
     Nadler
     Nethercutt
     Northup
     Norwood
     Nussle
     Oberstar
     Obey
     Olver
     Ortiz
     Oxley
     Packard
     Pallone
     Pappas
     Parker
     Pease
     Pelosi
     Peterson (MN)
     Peterson (PA)
     Petri
     Pickering
     Pickett
     Pombo
     Pomeroy
     Portman
     Poshard
     Pryce (OH)
     Quinn
     Redmond
     Regula
     Reyes
     Riley
     Rivers
     Rodriguez
     Rogers
     Ros-Lehtinen
     Rothman
     Roybal-Allard
     Rush
     Sabo
     Sanders
     Sandlin
     Sanford
     Saxton
     Scarborough
     Schaefer, Dan
     Shadegg
     Shaw
     Shimkus
     Sisisky
     Skeen
     Skelton
     Slaughter
     Smith (NJ)
     Smith (OR)
     Smith (TX)
     Smith, Linda
     Snyder
     Souder
     Sununu
     Taylor (NC)
     Thomas
     Thune
     Tierney
     Torres
     Traficant
     Upton
     Wamp
     Waters
     Watkins
     Waxman
     Weller
     Whitfield
     Wicker
     Wolf
     Woolsey
     Young (FL)

                               NOES--193

     Ackerman
     Allen
     Armey
     Baker
     Barcia
     Bartlett
     Bentsen
     Bilbray
     Blumenauer
     Boehner
     Bono
     Boucher
     Brown (CA)
     Brown (FL)
     Brown (OH)
     Bryant
     Bunning
     Burr
     Burton
     Buyer
     Callahan
     Capps
     Carson
     Castle
     Clay
     Clayton
     Clyburn
     Cook
     Coyne
     Cunningham
     Davis (FL)
     Davis (IL)
     DeGette
     DeLauro
     DeLay
     Deutsch
     Dickey
     Dingell
     Doggett
     Dooley
     Doyle
     Dreier
     Dunn
     Ehrlich
     Engel
     English
     Eshoo
     Etheridge
     Everett
     Farr
     Fattah
     Fazio
     Foley
     Ford
     Fossella
     Frank (MA)
     Frost
     Furse
     Gekas
     Goodlatte
     Gordon
     Granger
     Green
     Greenwood
     Hall (OH)
     Hall (TX)
     Hastert
     Hastings (FL)
     Hayworth
     Hefley
     Hill
     Hilliard
     Hoekstra
     Holden
     Hooley
     Hunter
     Jackson-Lee (TX)
     Jefferson
     Johnson, E. B.
     Johnson, Sam
     Jones
     Kelly
     Kennelly
     Kilpatrick
     Kind (WI)
     King (NY)
     Klink
     Knollenberg
     LaFalce
     LaHood
     Lampson
     Lantos
     Largent
     LaTourette
     Lazio
     Lee
     Levin
     Lewis (GA)
     Lewis (KY)
     Linder
     Livingston
     Lowey
     Maloney (CT)
     Manton
     Mascara
     McCarthy (NY)
     McCollum
     McGovern
     McHale
     McKinney
     McNulty
     Meehan
     Meek (FL)
     Meeks (NY)
     Mink
     Moakley
     Mollohan
     Moran (VA)
     Morella
     Murtha
     Myrick
     Neal
     Neumann
     Ney
     Owens
     Pascrell
     Pastor
     Paul
     Paxon
     Payne
     Pitts
     Porter
     Price (NC)
     Rahall
     Ramstad
     Rangel
     Riggs
     Roemer
     Rogan
     Rohrabacher
     Roukema
     Royce
     Ryun
     Salmon
     Sanchez
     Sawyer
     Schaffer, Bob
     Schumer
     Scott
     Sensenbrenner
     Serrano
     Sessions
     Shays
     Sherman
     Shuster
     Smith (MI)
     Smith, Adam
     Snowbarger
     Solomon
     Spratt
     Stabenow
     Stark
     Stearns
     Stenholm
     Stokes
     Strickland
     Stump
     Stupak
     Talent
     Tanner
     Tauscher
     Tauzin
     Taylor (MS)
     Thompson
     Thornberry
     Thurman
     Tiahrt
     Towns
     Turner
     Velazquez
     Vento
     Visclosky
     Walsh
     Watt (NC)
     Watts (OK)
     Weldon (FL)
     Weldon (PA)
     Wexler
     Weygand
     White
     Wise
     Wynn
     Young (AK)

                             NOT VOTING--10

     Bateman
     Christensen
     Forbes
     Gonzalez
     Harman
     Hefner
     Radanovich
     Skaggs
     Spence
     Yates

                              {time}  1924

  Messrs. LIVINGSTON, HEFLEY, ROGAN, WALSH, DOGGETT, GEKAS, JONES, and 
BRYANT changed their vote from ``aye'' to ``no.''
  Messrs. OXLEY, KIM, DICKS, GANSKE, KENNEDY of Massachusetts, WAXMAN, 
McKEON, McINTOSH, ISTOOK, McDERMOTT, MILLER of California, ADERHOLT, 
BASS, DELAHUNT, POMEROY, MICA, DOOLITTLE, GOODLING, and SHIMKUS, Ms. 
RIVERS, and Ms. LOFGREN changed their vote from ``no'' to ``aye.''
  So the amendment was agreed to.
  The result of the vote was announced as above recorded.


                      Announcement by the Chairman

  The CHAIRMAN. Pursuant to House Resolution 428, the Chair announces 
that she will reduce to a minimum of 5 minutes the period of time 
within which a vote by electronic device will

[[Page H3216]]

be taken on each amendment on which the Chair has postponed further 
proceedings.


                         Parliamentary Inquiry

  Mrs. ROUKEMA. Madam Chairman, I have a parliamentary inquiry.
  The CHAIRMAN. The gentlewoman will state it.
  Mrs. ROUKEMA. Madam Chairman, I have had many, many questions in the 
last few minutes, that Members were rather confused on what they were 
voting on. Will the Chair please explain what this second vote will be, 
with precision?
  The CHAIRMAN. The Chair is about to put the question on the Roukema 
amendment, as amended by the substitute by the gentleman from Iowa (Mr. 
Leach), on which the committee just voted.
  Mrs. ROUKEMA. I think Members have to understand that would mean that 
it would change the bill to include no commercial basket.
  The CHAIRMAN. The Chair cannot interpret the amendment.
  Mrs. ROUKEMA. Who can then? Who can?


          Amendment No. 5 offered by Mrs. Roukema, as Amended

  The CHAIRMAN. The Clerk will redesignate the amendment.
  The Clerk redesignated the amendment.
  The CHAIRMAN. The question is on Amendment No. 5 offered by the 
gentlewoman from New Jersey (Mrs. Roukema), as amended.
  The question was taken; and the Chairman announced that the ayes 
appeared to have it.


                             Recorded Vote

  Mrs. ROUKEMA. Madam Chairman, I demand a recorded vote.
  A recorded vote was ordered.
  The CHAIRMAN. This will be a 5 minute vote.
  The vote was taken by electronic device, and there were--ayes 218, 
noes 204, not voting 10, as follows:

                             [Roll No. 147]

                               AYES--218

     Abercrombie
     Aderholt
     Andrews
     Archer
     Bachus
     Baesler
     Baldacci
     Ballenger
     Barr
     Barrett (NE)
     Barrett (WI)
     Barton
     Bass
     Becerra
     Bentsen
     Bereuter
     Berman
     Berry
     Bilirakis
     Bishop
     Bliley
     Blunt
     Boehlert
     Bonior
     Bono
     Borski
     Boswell
     Boyd
     Brady
     Burton
     Buyer
     Calvert
     Camp
     Campbell
     Canady
     Cardin
     Chabot
     Chambliss
     Chenoweth
     Clement
     Coble
     Coburn
     Collins
     Combest
     Condit
     Cooksey
     Costello
     Cox
     Cramer
     Crane
     Crapo
     Danner
     Deal
     DeFazio
     Delahunt
     Diaz-Balart
     Dicks
     Dixon
     Doolittle
     Duncan
     Dunn
     Ehlers
     Emerson
     Ensign
     Evans
     Ewing
     Fawell
     Filner
     Foley
     Fowler
     Fox
     Franks (NJ)
     Frelinghuysen
     Gallegly
     Ganske
     Gejdenson
     Gekas
     Gephardt
     Gibbons
     Gilchrest
     Gillmor
     Gilman
     Goode
     Goodling
     Goss
     Graham
     Gutierrez
     Gutknecht
     Hall (OH)
     Hamilton
     Hansen
     Hastings (WA)
     Herger
     Hilleary
     Hinchey
     Hinojosa
     Hobson
     Horn
     Hostettler
     Houghton
     Hoyer
     Hulshof
     Hunter
     Hutchinson
     Inglis
     Istook
     Jackson (IL)
     Jenkins
     Johnson (CT)
     Johnson (WI)
     Jones
     Kanjorski
     Kasich
     Kennedy (MA)
     Kennedy (RI)
     Kildee
     Kingston
     Kleczka
     Klug
     Kolbe
     Kucinich
     Lampson
     Latham
     Leach
     Lipinski
     Lofgren
     Lucas
     Luther
     Maloney (NY)
     Manzullo
     Markey
     Martinez
     Matsui
     McCarthy (MO)
     McCrery
     McDade
     McDermott
     McHugh
     McInnis
     McIntosh
     McIntyre
     McKeon
     Menendez
     Metcalf
     Mica
     Miller (CA)
     Miller (FL)
     Minge
     Moran (KS)
     Murtha
     Nethercutt
     Northup
     Norwood
     Nussle
     Oberstar
     Obey
     Olver
     Ortiz
     Oxley
     Pallone
     Parker
     Pease
     Pelosi
     Peterson (MN)
     Peterson (PA)
     Petri
     Pickering
     Pickett
     Pomeroy
     Portman
     Poshard
     Redmond
     Regula
     Reyes
     Riley
     Rivers
     Rodriguez
     Rogers
     Ros-Lehtinen
     Rothman
     Roybal-Allard
     Sabo
     Sanders
     Sandlin
     Sanford
     Saxton
     Scarborough
     Schaefer, Dan
     Shadegg
     Shaw
     Sisisky
     Skeen
     Skelton
     Smith (NJ)
     Smith (TX)
     Smith, Linda
     Snyder
     Souder
     Stark
     Sununu
     Taylor (MS)
     Taylor (NC)
     Thomas
     Thune
     Tierney
     Torres
     Traficant
     Upton
     Wamp
     Waters
     Watkins
     Waxman
     Weller
     Whitfield
     Wicker
     Wolf
     Woolsey
     Young (FL)

                               NOES--204

     Ackerman
     Allen
     Armey
     Baker
     Barcia
     Bartlett
     Bilbray
     Blagojevich
     Blumenauer
     Boehner
     Bonilla
     Boucher
     Brown (CA)
     Brown (FL)
     Brown (OH)
     Bryant
     Bunning
     Burr
     Callahan
     Cannon
     Capps
     Carson
     Castle
     Clay
     Clayton
     Clyburn
     Conyers
     Cook
     Coyne
     Cubin
     Cummings
     Cunningham
     Davis (FL)
     Davis (IL)
     Davis (VA)
     DeGette
     DeLauro
     DeLay
     Deutsch
     Dickey
     Dingell
     Doggett
     Dooley
     Doyle
     Dreier
     Edwards
     Ehrlich
     Engel
     English
     Eshoo
     Etheridge
     Everett
     Farr
     Fattah
     Fazio
     Forbes
     Ford
     Fossella
     Frank (MA)
     Frost
     Furse
     Goodlatte
     Gordon
     Granger
     Green
     Greenwood
     Hall (TX)
     Hastert
     Hastings (FL)
     Hayworth
     Hefley
     Hill
     Hilliard
     Hoekstra
     Holden
     Hooley
     Hyde
     Jackson-Lee (TX)
     Jefferson
     John
     Johnson, E.B.
     Johnson, Sam
     Kelly
     Kennelly
     Kilpatrick
     Kim
     Kind (WI)
     King (NY)
     Klink
     Knollenberg
     LaFalce
     LaHood
     Lantos
     Largent
     LaTourette
     Lazio
     Lee
     Levin
     Lewis (CA)
     Lewis (GA)
     Lewis (KY)
     Linder
     Livingston
     LoBiondo
     Lowey
     Maloney (CT)
     Manton
     Mascara
     McCarthy (NY)
     McCollum
     McGovern
     McHale
     McKinney
     McNulty
     Meehan
     Meek (FL)
     Meeks (NY)
     Millender-McDonald
     Mink
     Moakley
     Mollohan
     Moran (VA)
     Morella
     Myrick
     Nadler
     Neal
     Neumann
     Ney
     Owens
     Packard
     Pappas
     Pascrell
     Pastor
     Paul
     Paxon
     Payne
     Pitts
     Pombo
     Porter
     Price (NC)
     Pryce (OH)
     Quinn
     Rahall
     Ramstad
     Rangel
     Riggs
     Roemer
     Rogan
     Rohrabacher
     Roukema
     Royce
     Rush
     Ryun
     Salmon
     Sanchez
     Sawyer
     Schaffer, Bob
     Schumer
     Scott
     Sensenbrenner
     Serrano
     Sessions
     Shays
     Sherman
     Shimkus
     Shuster
     Slaughter
     Smith (MI)
     Smith (OR)
     Smith, Adam
     Snowbarger
     Solomon
     Spratt
     Stabenow
     Stearns
     Stenholm
     Stokes
     Strickland
     Stump
     Stupak
     Talent
     Tanner
     Tauscher
     Tauzin
     Thompson
     Thornberry
     Thurman
     Tiahrt
     Towns
     Turner
     Velazquez
     Vento
     Visclosky
     Walsh
     Watt (NC)
     Watts (OK)
     Weldon (FL)
     Weldon (PA)
     Wexler
     Weygand
     White
     Wise
     Wynn
     Young (AK)

                             NOT VOTING--10

     Bateman
     Christensen
     Gonzalez
     Harman
     Hefner
     Kaptur
     Radanovich
     Skaggs
     Spence
     Yates

                              {time}  1937

  Messrs. SPRATT, JOHN, RUSH, and EDWARDS changed their vote from 
``aye'' to ``no.''
  Ms. WATERS and Mr. HUNTER changed their vote from ``no'' to ``aye.''
  So the amendment was agreed to.
  The result of the vote was announced as above recorded.


                Amendment No. 7 Offered by Mr. Kingston

  The CHAIRMAN. The pending business is the demand for a recorded vote 
on the amendment No. 7 offered by the gentleman from Georgia (Mr. 
Kingston) on which further proceedings were postponed and on which the 
ayes prevailed by voice vote.
  The Clerk will redesignate the amendment.
  The Clerk redesignated the amendment.


                         Parliamentary Inquiry

  Mr. SABO. Madam Chairman, I have a parliamentary inquiry.
  The CHAIRMAN. The gentleman will state it.
  Mr. SABO. Madam Chairman, is this a request for a rollcall vote on an 
amendment which passed without dissent?
  The CHAIRMAN. A recorded vote was requested.
  Mr. SABO. Madam Chairman, the amendment was accepted by all the 
managers of the bill without dissent?
  The CHAIRMAN. The Chair shortly will ask those in support of a 
recorded vote to rise. The Chair did not happen to be presiding at the 
time that that vote took place.
  Mr. SABO. Maybe we should vote ``no.''


                             Recorded Vote

  The CHAIRMAN. A recorded vote has been demanded.
  A recorded vote was ordered.
  The CHAIRMAN. This will be a 5-minute vote.
  The vote was taken by electronic device, and there were--ayes 404, 
noes 18, answered ``present'' 1, not voting 9, as follows:

                             [Roll No. 148]

                               AYES--404

     Ackerman
     Aderholt
     Allen
     Andrews
     Archer
     Armey
     Bachus
     Baesler
     Baker
     Baldacci
     Ballenger
     Barcia
     Barr
     Barrett (NE)
     Barrett (WI)
     Bartlett
     Barton
     Bass

[[Page H3217]]


     Becerra
     Bentsen
     Bereuter
     Berman
     Berry
     Bilbray
     Bilirakis
     Bishop
     Blagojevich
     Bliley
     Blunt
     Boehlert
     Boehner
     Bonilla
     Bono
     Borski
     Boswell
     Boucher
     Boyd
     Brady
     Brown (CA)
     Brown (FL)
     Brown (OH)
     Bryant
     Bunning
     Burr
     Burton
     Buyer
     Callahan
     Calvert
     Camp
     Campbell
     Canady
     Cannon
     Capps
     Cardin
     Carson
     Castle
     Chabot
     Chambliss
     Chenoweth
     Christensen
     Clay
     Clayton
     Clement
     Clyburn
     Coble
     Coburn
     Collins
     Combest
     Condit
     Cook
     Cooksey
     Costello
     Cox
     Coyne
     Cramer
     Crane
     Crapo
     Cubin
     Cummings
     Cunningham
     Danner
     Davis (FL)
     Davis (IL)
     Davis (VA)
     Deal
     DeGette
     Delahunt
     DeLauro
     DeLay
     Deutsch
     Diaz-Balart
     Dickey
     Dicks
     Dingell
     Dixon
     Doggett
     Doolittle
     Doyle
     Dreier
     Duncan
     Dunn
     Edwards
     Ehlers
     Ehrlich
     Emerson
     Engel
     English
     Ensign
     Eshoo
     Etheridge
     Evans
     Everett
     Ewing
     Farr
     Fattah
     Fawell
     Filner
     Foley
     Forbes
     Ford
     Fossella
     Fowler
     Fox
     Franks (NJ)
     Frelinghuysen
     Frost
     Furse
     Gallegly
     Ganske
     Gejdenson
     Gekas
     Gephardt
     Gibbons
     Gilchrest
     Gillmor
     Gilman
     Goode
     Goodlatte
     Goodling
     Gordon
     Goss
     Graham
     Granger
     Green
     Greenwood
     Gutierrez
     Gutknecht
     Hall (OH)
     Hall (TX)
     Hamilton
     Hansen
     Hastings (FL)
     Hastings (WA)
     Hayworth
     Hefley
     Herger
     Hill
     Hilleary
     Hilliard
     Hinchey
     Hinojosa
     Hobson
     Hoekstra
     Holden
     Hooley
     Horn
     Hostettler
     Houghton
     Hoyer
     Hulshof
     Hunter
     Hutchinson
     Hyde
     Inglis
     Istook
     Jackson (IL)
     Jackson-Lee (TX)
     Jefferson
     Jenkins
     John
     Johnson (CT)
     Johnson (WI)
     Johnson, E. B.
     Johnson, Sam
     Jones
     Kaptur
     Kasich
     Kelly
     Kennedy (MA)
     Kennedy (RI)
     Kennelly
     Kildee
     Kilpatrick
     Kim
     King (NY)
     Kingston
     Kleczka
     Klink
     Klug
     Knollenberg
     Kolbe
     Kucinich
     LaFalce
     Lampson
     Lantos
     Largent
     Latham
     LaTourette
     Lazio
     Leach
     Lee
     Levin
     Lewis (CA)
     Lewis (GA)
     Lewis (KY)
     Linder
     Lipinski
     Livingston
     LoBiondo
     Lofgren
     Lowey
     Lucas
     Luther
     Maloney (CT)
     Maloney (NY)
     Manton
     Manzullo
     Markey
     Martinez
     Mascara
     Matsui
     McCarthy (MO)
     McCarthy (NY)
     McCollum
     McCrery
     McDade
     McDermott
     McGovern
     McHale
     McHugh
     McInnis
     McIntosh
     McIntyre
     McKeon
     McKinney
     McNulty
     Meehan
     Meek (FL)
     Meeks (NY)
     Menendez
     Metcalf
     Mica
     Millender-McDonald
     Miller (CA)
     Miller (FL)
     Minge
     Moakley
     Mollohan
     Moran (KS)
     Moran (VA)
     Morella
     Murtha
     Myrick
     Nadler
     Neal
     Nethercutt
     Neumann
     Ney
     Northup
     Norwood
     Nussle
     Obey
     Olver
     Ortiz
     Owens
     Oxley
     Packard
     Pallone
     Pappas
     Pascrell
     Pastor
     Paul
     Paxon
     Payne
     Pease
     Pelosi
     Peterson (MN)
     Peterson (PA)
     Petri
     Pickering
     Pickett
     Pitts
     Pombo
     Pomeroy
     Porter
     Portman
     Poshard
     Price (NC)
     Pryce (OH)
     Quinn
     Rahall
     Ramstad
     Rangel
     Redmond
     Regula
     Reyes
     Riggs
     Riley
     Rivers
     Rodriguez
     Roemer
     Rogan
     Rogers
     Rohrabacher
     Ros-Lehtinen
     Rothman
     Roukema
     Roybal-Allard
     Royce
     Rush
     Ryun
     Salmon
     Sanders
     Sandlin
     Sanford
     Sawyer
     Saxton
     Scarborough
     Schaefer, Dan
     Schaffer, Bob
     Schumer
     Scott
     Sensenbrenner
     Serrano
     Sessions
     Shadegg
     Shaw
     Shays
     Sherman
     Shimkus
     Shuster
     Sisisky
     Skeen
     Skelton
     Slaughter
     Smith (MI)
     Smith (NJ)
     Smith (OR)
     Smith (TX)
     Smith, Adam
     Smith, Linda
     Snowbarger
     Snyder
     Solomon
     Souder
     Spence
     Spratt
     Stabenow
     Stearns
     Stenholm
     Stokes
     Strickland
     Stump
     Stupak
     Sununu
     Talent
     Tanner
     Tauscher
     Tauzin
     Taylor (MS)
     Taylor (NC)
     Thomas
     Thompson
     Thornberry
     Thune
     Thurman
     Tiahrt
     Tierney
     Towns
     Traficant
     Turner
     Upton
     Visclosky
     Walsh
     Wamp
     Waters
     Watkins
     Watt (NC)
     Watts (OK)
     Waxman
     Weldon (FL)
     Weldon (PA)
     Weller
     Wexler
     Weygand
     White
     Whitfield
     Wicker
     Wise
     Wolf
     Woolsey
     Wynn
     Young (AK)
     Young (FL)

                                NOES--18

     Abercrombie
     Blumenauer
     Bonior
     Conyers
     Dooley
     Fazio
     Kanjorski
     Kind (WI)
     LaHood
     Mink
     Oberstar
     Parker
     Sabo
     Sanchez
     Stark
     Torres
     Velazquez
     Vento

                        ANSWERED ``PRESENT''--1

       
     DeFazio
       

                             NOT VOTING--9

     Bateman
     Frank (MA)
     Gonzalez
     Harman
     Hastert
     Hefner
     Radanovich
     Skaggs
     Yates

                              {time}  1947

  So the amendment was agreed to.
  The result of the vote was announced as above recorded.


                Amendment No. 8 Offered by Mrs. Roukema

  The CHAIRMAN. The pending business is the demand for a recorded vote 
on amendment No. 8 offered by the gentlewoman from New Jersey (Mrs. 
Roukema) on which further proceedings were postponed and on which the 
ayes prevailed by voice vote.
  The Clerk will redesignate amendment.
  The Clerk redesignated the amendment.


                             Recorded Vote

  The CHAIRMAN. A recorded vote has been demanded.
  A recorded vote was ordered.
  The CHAIRMAN. This is a 5-minute vote.
  The vote was taken by electronic device, and there were--ayes 406, 
noes 13, not voting 13, as follows:

                             [Roll No. 149]

                               AYES--406

     Abercrombie
     Ackerman
     Aderholt
     Allen
     Andrews
     Archer
     Bachus
     Baesler
     Baker
     Baldacci
     Ballenger
     Barcia
     Barr
     Barrett (NE)
     Barrett (WI)
     Bartlett
     Barton
     Becerra
     Bentsen
     Bereuter
     Berman
     Berry
     Bilbray
     Bilirakis
     Bishop
     Blagojevich
     Bliley
     Blumenauer
     Blunt
     Boehlert
     Boehner
     Bonilla
     Bonior
     Bono
     Borski
     Boswell
     Boucher
     Boyd
     Brady
     Brown (CA)
     Brown (FL)
     Brown (OH)
     Bryant
     Bunning
     Burr
     Burton
     Buyer
     Callahan
     Calvert
     Camp
     Campbell
     Canady
     Cannon
     Capps
     Cardin
     Carson
     Castle
     Chabot
     Chambliss
     Chenoweth
     Christensen
     Clay
     Clayton
     Clement
     Clyburn
     Coble
     Coburn
     Collins
     Combest
     Condit
     Cook
     Cooksey
     Costello
     Cox
     Coyne
     Cramer
     Crane
     Cubin
     Cummings
     Cunningham
     Danner
     Davis (FL)
     Davis (IL)
     Davis (VA)
     Deal
     DeFazio
     DeGette
     Delahunt
     DeLauro
     DeLay
     Deutsch
     Diaz-Balart
     Dicks
     Dingell
     Dixon
     Doggett
     Dooley
     Doolittle
     Doyle
     Dreier
     Duncan
     Dunn
     Edwards
     Ehlers
     Ehrlich
     Emerson
     Engel
     English
     Ensign
     Eshoo
     Etheridge
     Evans
     Everett
     Ewing
     Farr
     Fattah
     Fawell
     Fazio
     Filner
     Foley
     Forbes
     Ford
     Fossella
     Fowler
     Fox
     Franks (NJ)
     Frelinghuysen
     Frost
     Furse
     Gallegly
     Ganske
     Gejdenson
     Gekas
     Gephardt
     Gibbons
     Gilchrest
     Gillmor
     Gilman
     Goode
     Goodlatte
     Goodling
     Gordon
     Goss
     Graham
     Granger
     Green
     Greenwood
     Gutierrez
     Gutknecht
     Hall (OH)
     Hall (TX)
     Hamilton
     Hansen
     Hastert
     Hastings (FL)
     Hastings (WA)
     Hayworth
     Herger
     Hill
     Hilleary
     Hilliard
     Hinchey
     Hinojosa
     Hobson
     Hoekstra
     Holden
     Hooley
     Horn
     Houghton
     Hoyer
     Hulshof
     Hunter
     Hutchinson
     Hyde
     Inglis
     Istook
     Jackson (IL)
     Jackson-Lee (TX)
     Jefferson
     Jenkins
     John
     Johnson (CT)
     Johnson (WI)
     Johnson, E. B.
     Johnson, Sam
     Jones
     Kaptur
     Kasich
     Kelly
     Kennedy (MA)
     Kennedy (RI)
     Kennelly
     Kildee
     Kilpatrick
     Kim
     Kind (WI)
     King (NY)
     Kingston
     Kleczka
     Klink
     Klug
     Knollenberg
     Kolbe
     Kucinich
     LaFalce
     Lampson
     Lantos
     Largent
     Latham
     LaTourette
     Lazio
     Leach
     Lee
     Levin
     Lewis (GA)
     Lewis (KY)
     Linder
     Lipinski
     Livingston
     LoBiondo
     Lofgren
     Lowey
     Lucas
     Luther
     Maloney (CT)
     Maloney (NY)
     Manton
     Manzullo
     Markey
     Martinez
     Mascara
     Matsui
     McCarthy (MO)
     McCarthy (NY)
     McCollum
     McCrery
     McDade
     McDermott
     McGovern
     McHale
     McHugh
     McInnis
     McIntosh
     McIntyre
     McKeon
     McKinney
     McNulty
     Meehan
     Meek (FL)
     Meeks (NY)
     Menendez
     Metcalf
     Mica
     Millender-McDonald
     Miller (CA)
     Miller (FL)
     Minge
     Mink
     Moakley
     Mollohan
     Moran (KS)
     Moran (VA)
     Morella
     Murtha
     Myrick
     Nadler
     Neal
     Neumann
     Ney
     Northup
     Norwood
     Nussle
     Obey
     Olver
     Ortiz
     Owens
     Oxley
     Packard
     Pallone
     Pappas
     Pascrell
     Pastor
     Paul
     Paxon
     Payne
     Pease
     Pelosi
     Peterson (PA)
     Petri
     Pickering
     Pickett
     Pitts
     Pomeroy
     Porter
     Portman
     Poshard
     Price (NC)
     Pryce (OH)
     Quinn
     Rahall
     Ramstad
     Rangel
     Redmond
     Regula
     Reyes
     Riggs
     Riley
     Rivers
     Rodriguez
     Roemer
     Rogan
     Rogers
     Rohrabacher
     Ros-Lehtinen
     Rothman
     Roukema
     Roybal-Allard
     Royce
     Rush
     Ryun
     Salmon
     Sanchez
     Sanders
     Sandlin
     Sanford
     Sawyer
     Saxton
     Scarborough
     Schaefer, Dan
     Schaffer, Bob
     Schumer
     Scott
     Sensenbrenner
     Serrano
     Sessions
     Shadegg
     Shaw
     Shays
     Sherman
     Shimkus

[[Page H3218]]


     Shuster
     Sisisky
     Skeen
     Skelton
     Slaughter
     Smith (MI)
     Smith (NJ)
     Smith (OR)
     Smith (TX)
     Smith, Adam
     Smith, Linda
     Snowbarger
     Snyder
     Solomon
     Souder
     Spence
     Spratt
     Stabenow
     Stark
     Stearns
     Stokes
     Strickland
     Stupak
     Sununu
     Talent
     Tanner
     Tauscher
     Tauzin
     Taylor (MS)
     Taylor (NC)
     Thomas
     Thompson
     Thornberry
     Thune
     Thurman
     Tiahrt
     Tierney
     Torres
     Towns
     Traficant
     Turner
     Upton
     Velazquez
     Vento
     Visclosky
     Walsh
     Wamp
     Waters
     Watkins
     Watt (NC)
     Watts (OK)
     Waxman
     Weldon (FL)
     Weldon (PA)
     Weller
     Wexler
     Weygand
     White
     Whitfield
     Wicker
     Wise
     Wolf
     Woolsey
     Wynn
     Young (AK)
     Young (FL)

                                NOES--13

     Conyers
     Dickey
     Hefley
     Hostettler
     Kanjorski
     LaHood
     Oberstar
     Parker
     Peterson (MN)
     Pombo
     Sabo
     Stenholm
     Stump

                             NOT VOTING--13

     Armey
     Bass
     Bateman
     Crapo
     Frank (MA)
     Gonzalez
     Harman
     Hefner
     Lewis (CA)
     Nethercutt
     Radanovich
     Skaggs
     Yates

                              {time}  1956

  So the amendment was agreed to.
  The result of the vote was announced as above recorded.
  The CHAIRMAN. It is now in order to consider amendment No. 9 printed 
in part 2 of House Report 105-531.


                 Amendment No. 9 Offered by Mr. Sanders

  Mr. SANDERS. Madam Chairman, I offer an amendment.
  The CHAIRMAN. The Clerk will designate the amendment.
  The text of the amendment is as follows:

       Amendment No. 9 offered by Mr. Sanders: After section 241 
     of the Amendment in the Nature of a Substitute, insert the 
     following new section (and conform the table of contents 
     accordingly):

     SEC. 242. STUDY OF LIMITATION ON FEES ASSOCIATED WITH 
                   ACQUIRING FINANCIAL PRODUCTS.

       Before the end of the 1-year period beginning on the date 
     of the enactment of this Act, the Comptroller General of the 
     United States shall submit a report to the Congress regarding 
     the efficacy and benefits of uniformly limiting any 
     commissions, fees, markups, or other costs incurred by 
     customers in the acquisition of financial products.

  The CHAIRMAN. Pursuant to House Resolution 428, the gentleman from 
Vermont (Mr. Sanders) and a Member opposed each will control 5 minutes.
  The Chair recognizes the gentleman from Vermont (Mr. Sanders).
  Mr. SANDERS. Madam Chairman, I yield myself such time as I may 
consume.
  Madam Chairman, my understanding is that this amendment has the 
support of both the majority and the minority, and therefore, I will be 
very, very brief.
  Madam Chairman, this amendment simply requires the Controller General 
of the United States to conduct a study on whether it would be 
beneficial, in light of the expected consolidation of the financial 
industry, if H.R. 10 were to pass to establish uniform limits on 
commissions and other fees charged to consumers who purchase stocks, 
bonds, insurance, and other financial products.

                              {time}  2000

  This amendment would require a report to be submitted to Congress 
concerning the results of the study within 1 year of enactment of this 
bill. That is the short version of my speech.
  Mr. BLILEY. Madam Chairman, will the gentleman yield?
  Mr. SANDERS. I yield to the gentleman from Virginia.
  Mr. BLILEY. Madam Chairman, we have looked at the amendment. We think 
it is helpful, and we will accept it.
  Mr. LEACH. Madam Chairman, will the gentleman yield?
  Mr. SANDERS. I yield to the gentleman from Iowa.
  Mr. LEACH. Madam Chairman, likewise, it is a very thoughtful 
amendment from a very thoughtful Member. I urge its consideration.
  Mr. SANDERS. Madam Chairman, I yield back the balance of my time.
  The CHAIRMAN. If there is no Member in opposition, the question is on 
the amendment offered by the gentleman from Vermont (Mr. Sanders).
  The amendment was agreed to.
  The CHAIRMAN. The Chair has been advised that amendment No. 10 to 
have been offered by the gentleman from Massachusetts (Mr. Markey) has 
been withdrawn.
  It is now in order to consider amendment No. 11 printed in part 2 of 
House Report 105-531.


                Amendment No. 11 Offered by Mr. Metcalf.

  Mr. METCALF. Madam Chairman, I offer an amendment.
  The CHAIRMAN. The Clerk will designate the amendment.
  The text of the amendment is as follows:

       Part 2 Amendment No. 11, offered by Mr. Metcalf:
       After section 401 of the Amendment in the Nature of a 
     Substitute, insert the following new section (and conform the 
     table of contents accordingly):

     SEC. 402. RETENTION OF ``FEDERAL'' IN NAME OF CONVERTED 
                   FEDERAL SAVINGS ASSOCIATION.

       Section 2 of the Act entitled ``An Act to enable national 
     banking associations to increase their capital stock and to 
     change their names or locations.'' and approved May 1, 1886 
     (12 U.S.C. 30) is amended by adding at the end the following 
     new subsection:
       ``(d) Retention of `Federal' in Name of Converted Federal 
     Savings Association.--
       ``(1) In general.--Notwithstanding subsection (a) or any 
     other provision of law, any depository institution the 
     charter of which is converted from that of a Federal savings 
     association to a national bank or a State bank after the date 
     of the enactment of the Financial Services Act of 1998 may 
     retain the term `Federal' in the name of such institution so 
     long as such depository institution remains an insured 
     depository institution.
       ``(2) Definitions.--For purposes of this subsection, the 
     terms `depository institution', `insured depository 
     institution', `national bank', and `State bank' have the same 
     meanings given to such terms in section 3 of the Federal 
     Deposit Insurance Act.''.

  The CHAIRMAN. Pursuant to House Resolution 428, the gentleman from 
Washington (Mr. Metcalf) and the gentleman from Texas (Mr. Bentsen) 
each will control 5 minutes.
  The Chair recognizes the gentleman from Washington (Mr. Metcalf).
  (Mr. METCALF asked and was given permission to revise and extend his 
remarks.)
  Mr. METCALF. Madam Chairman, I yield myself such time as I may 
consume.
  It is my understanding that the minority does not oppose what I 
consider to be just clearly a technical amendment. I would like to 
thank the gentleman from Iowa (Mr. Leach), the gentleman from Virginia 
(Mr. Bliley) and, of course, the gentleman from New York (Mr. Solomon) 
and the consideration of my ranking members, the gentleman from New 
York (Mr. LaFalce) and the gentleman from Michigan (Mr. Dingell) for 
allowing me to bring this technical amendment that would assist over 
500 financial institutions across the country.
  This amendment would simply change the law to allow federally 
chartered financial institutions that have the word ``Federal'' in 
their name or in their title to opt for a State banking charter if they 
so choose.
  Last year, when this issue came up in the Committee on Banking and 
Financial Services during markup of H.R. 10, this same amendment passed 
unanimously.
  Over 500 financial institutions across the country are hamstrung 
because they have the word ``Federal'' in their name. Some of these 
banks and thrifts may be over 100 years old and would like to benefit 
from the dual banking system and would simply like to change from a 
national charter to a State charter without having to change their 
name.
  I urge my colleagues to support this amendment to bring parity and 
fairness for all financial institutions. Like financial modernization, 
let us bring forth a level playing field for all financial institutions 
to have flexibility not only in the marketplace but also in the ability 
to change from a national to State charter.
  Mr. BLILEY. Madam Chairman, will the gentleman yield?
  Mr. METCALF. I yield to the gentleman from Virginia.
  Mr. BLILEY. Madam Chairman, we have looked at the amendment. We think 
it is a good amendment, and we are prepared to support it.
  Mr. LEACH. Madam Chairman, will the gentleman yield?
  Mr. METCALF. I yield to the gentleman from Iowa.
  Mr. LEACH. Madam Chairman, I also believe that what the gentleman is 
doing makes sense.
  I would only also stress what an enormous contribution he has made to 
the committee this year. I think this is a worthy amendment.

[[Page H3219]]

  Mr. METCALF. I appreciate those comments.
  Madam Chairman, I reserve the balance of my time.
  (Mr. BENTSEN asked and was given permission to revise and extend his 
remarks.)
  Mr. BENTSEN. Madam Chairman, I yield myself such time as I may 
consume.
  If I might, I would like to engage the gentleman from Washington in a 
colloquy if I could ask him a question about his amendment.
  If I understand this correctly, if you have a bank or savings bank or 
thrift which is currently federally chartered and has the name 
``Federal'' in it and then, as of this bill, that thrift or that bank 
decides to recharter as a State thrift or State bank, even though they 
will be a State institution, they can keep the name ``Federal'' or keep 
the word ``Federal'' in their name; is that correct?
  Mr. METCALF. Madam Chairman, will the gentleman yield?
  Mr. BENTSEN. I yield to the gentleman from Washington.
  Mr. METCALF. If my amendment goes through, that is correct. Many of 
them have had the name for a long time and would like to transfer to a 
State charter without having to change their name.
  Mr. BENTSEN. Madam Chairman, as we understand, current law does not 
allow for any institution which switches a charter from Federal to 
State or State to Federal to retain the previous name of origin, if you 
will, in their name, that they were a State bank or Federal bank.
  Mr. METCALF. Madam Chairman, if the gentleman will continue to yield, 
I know that one cannot, if they have the name ``Federal'', cannot 
switch to a State charter today.
  Mr. BENTSEN. I thank the gentleman.
  If you have a State and you go to a Federal, could you retain State 
in your name under this amendment?
  Mr. METCALF. Madam Chairman, I do not think that my amendment touches 
that.
  Mr. BENTSEN. I thank the gentleman.
  My only concern with this, and I think all of us are concerned with 
this legislation in terms of consumer protection and disclosure and 
appearances of whether or not there is some sort of taxpayer-backed 
guarantee to other financial activities that banks or thrifts are 
getting into. The problem I have with this particular amendment is that 
we are going to take the moniker of Federal and allow it to be used for 
nonfederally chartered institutions. I am not an expert on banking law, 
but I would imagine this is highly unprecedented.
  I appreciate what the gentleman is trying to do. I am a strong 
supporter of the dual banking system, as the gentleman knows from our 
work together on the Committee on Banking and Financial Services, but I 
think this raises a lot of questions with respect to proper disclosure. 
And I think that you have the problem that a depositor comes into a 
bank and they think it is a federally chartered bank, maybe they think 
it is still regulated by the Comptroller of the Currency, but it has 
shifted to a State-chartered bank. They may feel that they have more 
protections because the name Federal is in there than what they might 
have under a State charter. I appreciate what the gentleman is doing, 
but I have to oppose the amendment.
  Madam Chairman, I reserve the balance of my time.
  Mr. METCALF. Madam Chairman, I yield myself such time as I may 
consume.
  I would answer in this way, that the important factor is that State-
chartered institutions are still regulated by the Federal Reserve. They 
must carry Federal deposit insurance and they must still pay Federal 
taxes. In that regard, I think that the amendment is legitimate.
  Mr. LaFALCE. Madam Chairman, will the gentleman yield?
  Mr. METCALF. I yield to the gentleman from New York.
  Mr. LaFALCE. Madam Chairman, initially I had a conversation with the 
distinguished author of the amendment in which I said I would probably 
defer to the judgment of the chairman of the Committee on Banking and 
Financial Services on this issue. But I regret to inform him that now 
that I have reflected upon it, I feel compelled to oppose his 
amendment.
  I simply think it is misleading and it would also assist in the 
tendency that this bill will promote having national banks convert to a 
State charter. That is the effect, I think, of the governing structures 
that we have created in the bill.
  Now, the gentleman's amendment, I think, would make it a bit easier 
because they would be able to convert to the State charter, but still 
retain the word ``Federal.'' So it is with deep reluctance, but after 
reflection and consideration, hearing the gentleman from Texas (Mr. 
Bentsen), I feel constrained to oppose the gentleman's amendment.
  Mr. BENTSEN. Madam Chairman, how much time remains on both sides?
  The CHAIRMAN. The gentleman from Washington (Mr. Metcalf) has 30 
seconds remaining, and the gentleman from Texas (Mr. Bentsen) has 2 
minutes remaining.
  Mr. BENTSEN. Madam Chairman, who has the right to close?
  The CHAIRMAN. The gentleman from Texas (Mr. Bentsen) has the right to 
close.
  Mr. BENTSEN. Madam Chairman, I reserve the balance of my time.
  Mr. METCALF. Madam Chairman, I yield myself such time as I may 
consume.
  I would just reiterate that the important factor is that State-
chartered institutions still are regulated by the Federal Reserve, 
carry Federal deposit insurance and must still pay Federal taxes. I 
think this is legitimate, to not force them to change the name that 
many of them have had for 100 years. I think that that is unfortunate 
if they want to change to a State charter.
  Mr. BENTSEN. Madam Chairman, I yield myself the balance of my time.
  I have nothing but great respect for my colleague from Washington 
State. I think his amendment is well-intentioned but problematic. He 
mentions that State-chartered banks are still regulated by the Federal 
Reserve, but we also have State-chartered banks that are nonmember 
banks which are not members of the Federal Deposit Insurance 
Corporation, which means that you could switch your charter and create 
a bank, and there are still some in Texas, I believe, that are State-
chartered banks that are not protected by the FDIC. But if you retain 
``Federal,'' retain the Dime Box Federal Bank, someone might go in and 
think that they are still an FDIC bank.
  I am sure that when everybody walks into the bank, they look on the 
glass door there to make sure it says FDIC protection, they read all 
the language that is in there so they know. But I just think with all 
of our concern that has been raised today, whether it is the consumer 
protections which I support, or this issue of whether or not there is 
an implicit subsidy that occurs through operating subsidiaries or even 
as the chairman of the Federal Reserve, Mr. Greenspan says, with 
affiliates through holding companies, that this gives the wrong 
appearance.
  Quite frankly, I would just close by saying, this is one amendment 
where I cannot quote the chairman of the Federal Reserve and apparently 
no one else can. It is surprising, because we have heard his comments 
on every other amendment that we have addressed, but my feeling is 
probably, and I do not want to speak for the Fed chairman, but my 
feeling is probably if you push the Fed on this, they probably would 
not think this is a particularly good idea as well. Certainly anybody 
who is involved in disclosure would probably think this is not a good 
idea.
  I think the gentleman is very well intentioned in what he is trying 
to do. I do support the dual banking system, but I am not sure that we 
want to do this. Therefore, I would ask my colleagues to oppose the 
amendment.
  The CHAIRMAN. The question is on the amendment offered by the 
gentleman from Washington (Mr. Metcalf).
  The question was taken; and the Chairman announced that the ayes 
appeared to have it.
  Mr. KLECZKA. Madam Chairman, I demand a recorded vote.
  The CHAIRMAN. Pursuant to House Resolution 428, further proceedings 
on the amendment offered by the gentleman from Washington (Mr. Metcalf) 
will be postponed.

[[Page H3220]]

  It is now in order to consider amendment No. 12 printed in part 2 of 
House report 105-531.


           Amendment No. 12 Offered by Mr. Moran of Virginia

  Mr. MORAN of Virginia. Madam Chairman, I offer an amendment.
  The CHAIRMAN. The Clerk will designate the amendment.
  The text of the amendment is as follows:

       Part 2, amendment No. 12, offered by Mr. Moran of 
     Virginia:  At the end of section 305 of the Amendment in 
     the Nature of a Substitute insert the following new 
     sentence: ``This section shall cease to have effect 5 
     years after the date of the enactment of this Act.''.

  The CHAIRMAN. Pursuant to House Resolution 428, the gentleman from 
Virginia (Mr. Moran) and the gentleman from Virginia (Mr. Bliley), each 
will control 5 minutes.
  Does the gentleman from Virginia (Mr. Bliley) oppose the amendment?
  Mr. BLILEY. Madam Chairman, we are prepared to accept the amendment.
  The CHAIRMAN. Is there a Member in opposition to the amendment?
  Mr. DINGELL. Madam Chairman, we are happy to accept the amendment 
over here.
  The CHAIRMAN. Without objection, the gentleman from Virginia (Mr. 
Bliley) will be recognized for 5 minutes.
  There was no objection.
  Mr. MORAN of Virginia. Madam Chairman, I yield myself such time as I 
may consume.
  I know when I am ahead and I will keep this brief, but just simply 
explain that this amendment would sunset, that is, repeal after 5 years 
the requirement that any bank that is not currently selling insurance 
products would not have to purchase an insurance agency that has been 
regulated within their State for at least 2 years. That reduces the 
competition, and this is obviously a compromise amendment that will at 
least take this prohibition away and produce greater competition in the 
marketplace. It was a fairly restrictive amendment. By providing 5 
years before the sunset, I do not think any of the industries are going 
to take particular exception to it.
  I appreciate the fact that there is no opposition to it.
  Madam Chairman, I yield to the gentleman from Minnesota (Mr. Vento).
  Mr. VENTO. Madam Chairman, I commend the gentleman for his amendment. 
I recommend it to my colleagues, but I think this just points out one 
of the major problems with this bill in that, throughout this bill, 
this measure has treated national banks in a disparate manner. It is 
suggested that for only 5 years you cannot go into a State, under 
modernization and deregulation, mind you, you cannot go into a State 
and start de novo, that is, start from scratch, an insurance business 
under this deregulation bill for only 5 years. And then after that 5 
years, now, with this amendment, of course, it was forever based on 
what was in the bill. So the gentleman has made a great improvement in 
the bill.
  Unfortunately, it still has restrictions for towns of 5,000 for the 
sale of insurance for banks. It still has restrictions that treat 
national banks in a different way than they treat State banks for the 
purpose of insurance. It still has in the bill restrictions in terms of 
the sale of title insurance, in terms of national banks.

                              {time}  2015

  So on and on it goes with this disparate treatment. And this is one 
more reason, I am afraid, that this bill should not be passed.
  And I commend the gentleman for trying to improve it, it just does 
not improve it enough. I think we needed a lot more than what is in 
this one amendment that they permitted the gentleman to offer.
  Mr. OXLEY. Madam Chairman, will the gentleman yield?
  Mr. MORAN of Virginia. I yield to the gentleman from Ohio.
  Mr. OXLEY. Madam Chairman, I thank my friend from Virginia, and let 
me commend him on his amendment. I was at the Committee on Rules when 
he offered the amendment.
  To correct my friend from Minnesota, this was the product of a very 
carefully balanced compromise between warring parties that have been at 
this for at least 20 years. We finally got an agreement with many of 
the banks and with the insurance industry and the agents to finally put 
this issue behind us. That was the essence of what this compromise is 
all about.
  Did it give the banks everything they wanted? Of course, not. And the 
gentleman from Minnesota seems to think that that is the way it ought 
to be. I would suggest to the gentleman that this was a product of a 
reasonable compromise. That is what this bill is all about. The 
gentleman's amendment will provide, I think, a meaningful amendment.
  Let me just say, in closing, I commend the gentleman on his amendment 
but simply say that the gentleman from Minnesota wants it all and that 
is not the way the process works around here.
  Mr. VENTO. Madam Chairman, will the gentleman yield?
  Mr. MORAN of Virginia. I yield to the gentleman from Minnesota.
  Mr. VENTO. The gentleman from Minnesota does not want it all, but he 
wants a level playing field to permit banks that are national to have 
the same rights of banks that are State. And this bill does not do it. 
And it is intentional.
  I understand it was a tough negotiation. I commend the gentleman. But 
the only thing balanced about this is the deal that is being offered to 
the House. I do not think it is good enough. I commend the gentleman 
for trying to improve it but it does not go far enough.
  Mr. MORAN of Virginia. Madam Chairman, I thank my two friends and 
colleagues for expanding the battlefield upon which this amendment 
might be considered, but again let me just say that without this 
amendment the bill would have created a situation where some banks can 
continue to sell insurance under current Federal and State guidelines 
while other banks would be forced to buy an insurance agency first 
before they can sell the very same insurance products.
  I appreciate the support that it has.
  The CHAIRMAN. Does the gentleman from Virginia (Mr. Bliley) wish to 
consume the balance of the time?
  Mr. BLILEY. Madam Chairman, I yield back the balance of the time.
  The CHAIRMAN. The question is on the amendment offered by the 
gentleman from Virginia (Mr. Moran).
  The amendment was agreed to.


                Amendment No. 11 Offered by Mr. Metcalf

  The CHAIRMAN. The pending business is the demand for a recorded vote 
on the amendment offered by the gentleman from Washington (Mr. Metcalf) 
on which further proceedings were postponed, and on which the ayes 
prevailed by voice vote.
  The Clerk will redesignate the amendment.
  The Clerk redesignated the amendment.
  The CHAIRMAN. A recorded vote has been demanded.
  A recorded vote was refused.
  On a division (demanded by Mr. Kleczka) there were ayes 14, noes 7.
  So the amendment was agreed to.
  The CHAIRMAN. The question is on the amendment in the nature of a 
substitute, as amended.
  The amendment in the nature of a substitute, as amended, was agreed 
to.
  The CHAIRMAN. Under the rule, the Committee rises.
  Accordingly, the Committee rose; and the Speaker pro tempore (Mr. 
Barrett of Nebraska) having assumed the chair, Mrs. Emerson, Chairman 
of the Committee of the Whole House on the State of the Union, reported 
that that Committee, having had under consideration the bill (H.R. 10) 
to enhance competition in the financial services industry by providing 
a prudential framework for the affiliation of banks, securities firms, 
and other financial service providers, and for other purposes, pursuant 
to House Resolution 428, she reported the bill back to the House with 
an amendment adopted by the Committee of the Whole.
  The SPEAKER pro tempore. Under the rule, the previous question is 
ordered.
  Is a separate vote demanded on any amendment to the amendment in the 
nature of a substitute adopted by the Committee of the Whole?
  Mr. KLECZKA. Mr. Speaker, I demand a separate recorded vote on 
amendment No. 11, the so-called Metcalf amendment.
  The SPEAKER pro tempore. The Clerk will report the amendment on which 
a separate vote has been demanded.


[[Page H3221]]


     The Clerk read as follows:
       Amendment:
       After section 401 of the Amendment in the Nature of a 
     Substitute, insert the following new section (and conform the 
     table of contents accordingly):

     SEC. 402. RETENTION OF ``FEDERAL'' IN NAME OF CONVERTED 
                   FEDERAL SAVINGS ASSOCIATION.

       Section 2 of the Act entitled ``an Act to enable national 
     banking associations to increase their capital stock and to 
     change their names or locations.'' and approved May 1, 1886 
     (12 U.S.C. 30) is amended by adding at the end the following 
     new subsection:
       ``(d) Retention of `Federal' in Name of Converted Federal 
     Savings Association--
       ``(1) In general.--Notwithstanding subsection (a) or any 
     other provision of law, any depository institution the 
     charter of which is converted from that of a Federal savings 
     association to a national bank or a State bank after the date 
     of the enactment of the Financial Services Act of 1998 may 
     retain the term `Federal' in the name of such institution so 
     long as such depository institution remains an insured 
     depository institution.
       ``(2) Definitions.--For purposes of this subsection, the 
     terms `depository institution', `insured depository 
     institution', `national bank', and `State bank' have the same 
     meanings given to such terms in section 3 of the Federal 
     Deposit Insurance Act.''.

  Mrs. ROUKEMA (during the reading). Mr. Speaker, I ask unanimous 
consent that the amendment be considered as read and printed in the 
Record.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentlewoman from New Jersey?
  There was no objection.
  The SPEAKER pro tempore. The question is on the amendment.
  The question was taken; and the Speaker pro tempore announced that 
the noes appeared to have it.
  Mr. METCALF. Mr. Speaker, I object to the vote on the ground that a 
quorum is not present and make the point of order that a quorum is not 
present.
  The SPEAKER pro tempore. Evidently a quorum is not present.
  The Sergeant at Arms will notify absent Members.
  The vote was taken by electronic device, and there were--yeas 256, 
nays 166, not voting 10, as follows:

                             [Roll No. 150]

                               YEAS--256

     Aderholt
     Archer
     Armey
     Bachus
     Baker
     Ballenger
     Barcia
     Barr
     Barrett (NE)
     Bartlett
     Barton
     Bass
     Bilbray
     Bilirakis
     Bliley
     Boehlert
     Boehner
     Bonilla
     Bono
     Boswell
     Boucher
     Brady
     Brown (OH)
     Bryant
     Bunning
     Burr
     Burton
     Buyer
     Callahan
     Calvert
     Camp
     Campbell
     Canady
     Cannon
     Capps
     Castle
     Chabot
     Chambliss
     Chenoweth
     Christensen
     Coble
     Coburn
     Collins
     Combest
     Cooksey
     Crane
     Crapo
     Cubin
     Cunningham
     Davis (VA)
     Deal
     DeGette
     DeLay
     Deutsch
     Diaz-Balart
     Dickey
     Dicks
     Dingell
     Dreier
     Duncan
     Dunn
     Ehlers
     Ehrlich
     Emerson
     English
     Ensign
     Etheridge
     Everett
     Ewing
     Fawell
     Foley
     Forbes
     Fossella
     Fowler
     Fox
     Franks (NJ)
     Frelinghuysen
     Frost
     Gallegly
     Ganske
     Gekas
     Gibbons
     Gilchrest
     Gilman
     Goode
     Goodlatte
     Goodling
     Goss
     Graham
     Granger
     Greenwood
     Gutierrez
     Gutknecht
     Hall (OH)
     Hall (TX)
     Hansen
     Hastert
     Hastings (WA)
     Hayworth
     Hefley
     Herger
     Hill
     Hilleary
     Hobson
     Hoekstra
     Hooley
     Horn
     Hostettler
     Houghton
     Hulshof
     Hunter
     Hutchinson
     Hyde
     Inglis
     Istook
     Jackson-Lee (TX)
     Jenkins
     John
     Johnson, Sam
     Jones
     Kasich
     Kelly
     Kilpatrick
     Kim
     King (NY)
     Kingston
     Klug
     Knollenberg
     Largent
     Latham
     LaTourette
     Lazio
     Leach
     Lewis (CA)
     Lewis (KY)
     Linder
     Livingston
     LoBiondo
     Lofgren
     Lucas
     Manton
     Manzullo
     McCarthy (NY)
     McCollum
     McCrery
     McDade
     McDermott
     McGovern
     McHugh
     McInnis
     McIntosh
     McIntyre
     McKeon
     Metcalf
     Mica
     Millender-McDonald
     Miller (FL)
     Moran (KS)
     Morella
     Myrick
     Nethercutt
     Neumann
     Ney
     Northup
     Norwood
     Nussle
     Oxley
     Packard
     Pallone
     Pappas
     Parker
     Paul
     Paxon
     Pease
     Peterson (MN)
     Peterson (PA)
     Petri
     Pickering
     Pitts
     Pombo
     Porter
     Portman
     Pryce (OH)
     Quinn
     Rahall
     Ramstad
     Rangel
     Redmond
     Regula
     Riggs
     Riley
     Rivers
     Rogan
     Rogers
     Rohrabacher
     Ros-Lehtinen
     Roukema
     Rush
     Ryun
     Salmon
     Sanders
     Sanford
     Sawyer
     Saxton
     Scarborough
     Schaefer, Dan
     Schaffer, Bob
     Scott
     Sensenbrenner
     Sessions
     Shadegg
     Shaw
     Shuster
     Sisisky
     Skeen
     Smith (MI)
     Smith (NJ)
     Smith (OR)
     Smith (TX)
     Smith, Adam
     Smith, Linda
     Snowbarger
     Solomon
     Souder
     Spence
     Stabenow
     Stenholm
     Stump
     Stupak
     Sununu
     Talent
     Tauzin
     Taylor (NC)
     Thomas
     Thornberry
     Thune
     Tiahrt
     Traficant
     Turner
     Upton
     Visclosky
     Walsh
     Wamp
     Watkins
     Watts (OK)
     Weldon (FL)
     Weldon (PA)
     Weller
     White
     Whitfield
     Wicker
     Wolf
     Woolsey
     Wynn
     Young (AK)
     Young (FL)

                               NAYS--166

     Abercrombie
     Ackerman
     Allen
     Andrews
     Baesler
     Baldacci
     Barrett (WI)
     Becerra
     Bentsen
     Bereuter
     Berman
     Berry
     Bishop
     Blagojevich
     Blumenauer
     Blunt
     Bonior
     Borski
     Boyd
     Brown (CA)
     Brown (FL)
     Cardin
     Carson
     Clay
     Clayton
     Clement
     Clyburn
     Condit
     Conyers
     Cook
     Costello
     Coyne
     Cramer
     Cummings
     Danner
     Davis (FL)
     Davis (IL)
     DeFazio
     Delahunt
     DeLauro
     Dixon
     Doggett
     Dooley
     Doyle
     Edwards
     Engel
     Eshoo
     Evans
     Farr
     Fattah
     Fazio
     Filner
     Ford
     Furse
     Gejdenson
     Gephardt
     Gillmor
     Gordon
     Green
     Hamilton
     Hastings (FL)
     Hilliard
     Hinchey
     Hinojosa
     Holden
     Hoyer
     Jackson (IL)
     Jefferson
     Johnson (CT)
     Johnson (WI)
     Johnson, E. B.
     Kanjorski
     Kaptur
     Kennedy (MA)
     Kennedy (RI)
     Kennelly
     Kildee
     Kind (WI)
     Kleczka
     Klink
     Kolbe
     Kucinich
     LaFalce
     LaHood
     Lampson
     Lantos
     Lee
     Levin
     Lewis (GA)
     Lipinski
     Lowey
     Luther
     Maloney (CT)
     Maloney (NY)
     Markey
     Martinez
     Mascara
     Matsui
     McCarthy (MO)
     McHale
     McKinney
     McNulty
     Meehan
     Meek (FL)
     Meeks (NY)
     Menendez
     Miller (CA)
     Minge
     Mink
     Moakley
     Mollohan
     Moran (VA)
     Murtha
     Nadler
     Neal
     Oberstar
     Obey
     Olver
     Ortiz
     Owens
     Pascrell
     Pastor
     Payne
     Pelosi
     Pickett
     Pomeroy
     Poshard
     Price (NC)
     Reyes
     Rodriguez
     Roemer
     Rothman
     Roybal-Allard
     Royce
     Sabo
     Sanchez
     Sandlin
     Schumer
     Serrano
     Shays
     Sherman
     Shimkus
     Skelton
     Slaughter
     Snyder
     Spratt
     Stark
     Stearns
     Stokes
     Strickland
     Tanner
     Tauscher
     Taylor (MS)
     Thompson
     Thurman
     Tierney
     Torres
     Towns
     Velazquez
     Vento
     Waters
     Watt (NC)
     Waxman
     Wexler
     Weygand
     Wise

                             NOT VOTING--10

     Bateman
     Cox
     Doolittle
     Frank (MA)
     Gonzalez
     Harman
     Hefner
     Radanovich
     Skaggs
     Yates

                              {time}  2048

  Mrs. LOWEY, Mr. ABERCROMBIE and Mr. MINGE changed their vote from 
``yea'' to ``nay.''
  Ms. WOOLSEY and Messrs. RUSH, DEUTSCH, DIAZ-BALART, and HULSHOF 
changed their vote from ``nay'' to ``yea.''
  So the amendment was agreed to.
  The result of the vote was announced as above recorded.
  The SPEAKER pro tempore (Mr. Barrett of Nebraska). The question is on 
the amendment in the nature of a substitute, as amended.
  The amendment in the nature of a substitute, as amended, was agreed 
to.
  The SPEAKER pro tempore. The question is on the engrossment and third 
reading of the bill.
  The bill was ordered to be engrossed and read a third time, and was 
read the third time.
  The SPEAKER pro tempore. The question is on the passage of the bill.
  The question was taken; and the Speaker pro tempore announced that 
the ayes appeared to have it.


                             Recorded Vote

  Mr. LaFALCE. Mr. Speaker, I demand a recorded vote.
  A recorded vote was ordered.
  The vote was taken by electronic device, and there were--ayes 214, 
noes 213, not voting 6, as follows:

                             [Roll No. 151]

                               AYES--214

     Ackerman
     Andrews
     Archer
     Armey
     Baker
     Ballenger
     Barcia
     Barr
     Bartlett
     Bass
     Bilbray
     Bilirakis
     Bishop
     Blagojevich
     Bliley
     Boehlert
     Boehner
     Bono
     Boyd
     Brown (OH)
     Bryant
     Bunning
     Burton
     Buyer
     Calvert
     Castle
     Chabot
     Coble
     Collins
     Condit
     Cook
     Cooksey
     Cox
     Coyne
     Cramer
     Crane
     Crapo
     Cubin
     Cunningham
     Deal
     DeGette
     Delahunt
     DeLauro
     DeLay
     Deutsch
     Diaz-Balart
     Dicks
     Dingell
     Dooley
     Doolittle
     Doyle
     Dunn
     Ehlers
     Ehrlich
     Emerson
     Engel
     English
     Ensign
     Fawell
     Fazio
     Forbes
     Ford
     Fossella
     Fox
     Franks (NJ)
     Frelinghuysen
     Frost
     Gallegly
     Ganske
     Gejdenson
     Gekas
     Gibbons

[[Page H3222]]


     Gilchrest
     Gillmor
     Gilman
     Gingrich
     Goodlatte
     Goodling
     Gordon
     Goss
     Greenwood
     Hall (OH)
     Hansen
     Hastert
     Hastings (WA)
     Hayworth
     Herger
     Hill
     Hobson
     Hoekstra
     Holden
     Horn
     Hostettler
     Houghton
     Hyde
     Inglis
     John
     Johnson (CT)
     Johnson, E. B.
     Kasich
     Kelly
     Kennelly
     Kim
     King (NY)
     Kingston
     Klug
     Knollenberg
     Kolbe
     Latham
     LaTourette
     Lazio
     Leach
     Levin
     Lewis (CA)
     Linder
     Livingston
     LoBiondo
     Lowey
     Maloney (NY)
     Manton
     Markey
     McCarthy (NY)
     McCrery
     McDade
     McGovern
     McIntosh
     McKeon
     McNulty
     Meeks (NY)
     Metcalf
     Mica
     Miller (FL)
     Mollohan
     Moran (VA)
     Morella
     Murtha
     Myrick
     Nadler
     Neal
     Nethercutt
     Neumann
     Ney
     Northup
     Norwood
     Nussle
     Oxley
     Packard
     Pallone
     Pappas
     Parker
     Pascrell
     Paxon
     Pease
     Pitts
     Pomeroy
     Porter
     Portman
     Price (NC)
     Pryce (OH)
     Quinn
     Radanovich
     Rahall
     Rangel
     Regula
     Riggs
     Rogan
     Rohrabacher
     Ros-Lehtinen
     Roukema
     Royce
     Salmon
     Sanford
     Sawyer
     Saxton
     Schaefer, Dan
     Schumer
     Sensenbrenner
     Shadegg
     Shaw
     Shays
     Shimkus
     Smith (MI)
     Smith (NJ)
     Smith, Adam
     Smith, Linda
     Solomon
     Souder
     Spence
     Spratt
     Stabenow
     Stearns
     Strickland
     Stump
     Stupak
     Sununu
     Talent
     Tanner
     Tauscher
     Tauzin
     Taylor (NC)
     Thomas
     Towns
     Upton
     Walsh
     Wamp
     Weldon (FL)
     Weldon (PA)
     Weller
     Wexler
     White
     Whitfield
     Wise
     Wolf
     Young (FL)

                               NOES--213

     Abercrombie
     Aderholt
     Allen
     Bachus
     Baesler
     Baldacci
     Barrett (NE)
     Barrett (WI)
     Barton
     Becerra
     Bentsen
     Bereuter
     Berman
     Berry
     Blumenauer
     Blunt
     Bonilla
     Bonior
     Borski
     Boswell
     Boucher
     Brady
     Brown (CA)
     Brown (FL)
     Burr
     Callahan
     Camp
     Campbell
     Canady
     Cannon
     Capps
     Cardin
     Carson
     Chambliss
     Chenoweth
     Christensen
     Clay
     Clayton
     Clement
     Clyburn
     Coburn
     Combest
     Conyers
     Costello
     Cummings
     Danner
     Davis (FL)
     Davis (IL)
     Davis (VA)
     DeFazio
     Dickey
     Dixon
     Doggett
     Dreier
     Duncan
     Edwards
     Eshoo
     Etheridge
     Evans
     Everett
     Ewing
     Farr
     Fattah
     Filner
     Foley
     Fowler
     Frank (MA)
     Furse
     Gephardt
     Goode
     Graham
     Granger
     Green
     Gutierrez
     Gutknecht
     Hall (TX)
     Hamilton
     Hastings (FL)
     Hefley
     Hilleary
     Hilliard
     Hinchey
     Hinojosa
     Hooley
     Hoyer
     Hulshof
     Hunter
     Hutchinson
     Istook
     Jackson (IL)
     Jackson-Lee (TX)
     Jefferson
     Jenkins
     Johnson (WI)
     Johnson, Sam
     Jones
     Kanjorski
     Kaptur
     Kennedy (MA)
     Kennedy (RI)
     Kildee
     Kilpatrick
     Kind (WI)
     Kleczka
     Klink
     Kucinich
     LaFalce
     LaHood
     Lampson
     Lantos
     Largent
     Lee
     Lewis (GA)
     Lewis (KY)
     Lipinski
     Lofgren
     Lucas
     Luther
     Maloney (CT)
     Manzullo
     Martinez
     Mascara
     Matsui
     McCarthy (MO)
     McCollum
     McDermott
     McHale
     McHugh
     McInnis
     McIntyre
     McKinney
     Meehan
     Meek (FL)
     Menendez
     Millender-McDonald
     Miller (CA)
     Minge
     Mink
     Moakley
     Moran (KS)
     Oberstar
     Obey
     Olver
     Ortiz
     Owens
     Pastor
     Paul
     Payne
     Pelosi
     Peterson (MN)
     Peterson (PA)
     Petri
     Pickering
     Pickett
     Pombo
     Poshard
     Ramstad
     Redmond
     Reyes
     Riley
     Rivers
     Rodriguez
     Roemer
     Rogers
     Rothman
     Roybal-Allard
     Rush
     Ryun
     Sabo
     Sanchez
     Sanders
     Sandlin
     Scarborough
     Schaffer, Bob
     Scott
     Serrano
     Sessions
     Sherman
     Shuster
     Sisisky
     Skeen
     Skelton
     Slaughter
     Smith (OR)
     Smith (TX)
     Snowbarger
     Snyder
     Stark
     Stenholm
     Stokes
     Taylor (MS)
     Thompson
     Thornberry
     Thune
     Thurman
     Tiahrt
     Tierney
     Torres
     Traficant
     Turner
     Velazquez
     Vento
     Visclosky
     Waters
     Watkins
     Watt (NC)
     Watts (OK)
     Waxman
     Weygand
     Wicker
     Woolsey
     Wynn
     Young (AK)

                             NOT VOTING--6

     Bateman
     Gonzalez
     Harman
     Hefner
     Skaggs
     Yates

                              {time}  2112

  Mr. EWING and Mr. MALONEY of Connecticut changed their vote from 
``aye'' to ``no.''
  Messrs. ARCHER, MILLER of Florida and STEARNS changed their vote from 
``no'' to ``aye.''
  So the bill was passed.
  The result of the vote was announced as above recorded.
  A motion to reconsider was laid on the table.

                          ____________________