Date: 1987-04-23
Speaker: ST GERMAIN (democrat)
Chamber: H

Mr. Speaker. it is essential that we have early resolution of issues surrounding the recapitalization of the Federal Savings and Loan Insurance Corporation. The Banking. Finance and Urban Affairs Committee has reported H.R. 27 which provides much needed funds for FSLIC and establishes new guidelines for regulatory actions involving troubled savings and loan institutions in areas suffering from severe economic distress. I am hopeful. Mr. Speaker. that the House will be able to act on this legislation in the near future and that we will have the cooperation of the other body in moving a recapitalization bill to the Presidents desk expeditiously. Mr. Speaker. we are all aware that the Senate has encased its version of the FSLIC recapitalization In a larger multititled billS. 790that deals with everything from interstate banking to agricultural lending practices. To be specific: The Senate bill addresses the socalled question of nonbank banks. The Senate bill addresses the question of GlassSteagall as it applies to banks and bank holding companies and provides for a moratorium on the ability of the Federal Reserve to issue any rulings allowing bank holding companies to engage in various activities some argue should be determined by the Congress. The Senate bill contains a provision regarding the question of powers of Statechartered savings banks. The Senate bill addresses the socalled South Dakota insurance loophole. The Senate bill addresses the question of restrictions on savings and loan holding companies and. similarly. restrictions on unitary savings and loan holding companies. The Senate bill addresses the question which has been considered by your Banking Committees in the past of a qualified thrift lender test for thrift institutions. The Senate bill creates a national commission to study and report back to the President on changes needed in our financial laws to promote a competitive American financial industry. The Senate bill addresses the question of nonbanking activities performed by foreign banks operating in the United States. The Senate bill addresses the apportionment of funds by OMB concerning the FDIC. the Federal Home Loan Bank Board. and the NCUA under the GrammRudmanHollings Act. The Senate bill addresses the socalled interstate acquisition question of failed or failing banks and provides the FDIC with bridge bank authority. The Senate bill addresses the question of credit union conservatorship authority. The Senate bill addresses the question of socalled checkhold legislation. The Senate bill addresses the question of the cashing of government checks by depository institutions. The Senate bill addresses the question of loans and loan loss writeoffs by qualified agricultural banks. The Senate bill has a provision establishing the full faith and credit of the Federal Government behind deposits of federally insured savings and loan institutions and. finally. The Senate bill calls for a study of so called high yield bonds. Mr. Speaker. this is a significant array of issues that touches. In some manner. virtually every facet of the Nations financial industry. Frankly. I am in sympathy with many aspects of the Senatepassed bill. but it would be improper and irresponsible to ask my colleagues to accept these provisions on which there have been no hearings. no debate and no votes in the subcommittees and committee of jurisdiction in the House of Representatives. There are at least three key reasons why I think it would be a mistake to attempt to bring the S. 790 issues to the floor of the House in the form of a conference report at the present time. First. the issues are too important to be acted on without hearings. debate and votes within the committee and on the House floor. The House should have an opportunity to work its wifl on each of these issues. Second. the parliamentary procedure we would face with such a conference is so convoluted and involved to render the objective a virtual impossibility. Third. the issues involved in the Senate bill are so controversial that such a conference would almost certainly doom chances for early action on FSLIC. something that has become very close to an emergency situation that has little room left for more delays. Let me just outline some of the parliamentary problems facing us if we tried to deal with the S. 790 package. Assuming passage of H.R. 27. this approach would then require the chairman to ask unanimous consent to have the text of H.R. 27 substituted for the text of S. 790 and request a conference. There is no doubt in my mind that there would be an objection to this unanimous consent request. Assuming. and I think it is a fair assumption. the unanimous consent would be objected to. one would then go back into committee and have the committee direct its chairman to go back to the floor and move to go to conference with the Senate on their legislation. I do not believe the committee nor the House would act favorably on such a request. But lets assume the unanimous consent request is approved. We then would go to conference with the Senate Banking Committee. the House containing a onetitle bill and the Senate containing 10 titles. 9 of which bear no relationship to the House bill as far as the House germaneness rule is concemed. In conference. the House conferees hands would be severely tied. We could not seek to amend their 10 titlies to more adequately. perhaps. reflect the House views. because we would run into very serious scope problems. which would completely kill the conferencereported bill in the House. and In fact force us back to conference on just the FSLIC titles in both bills. The House conferees would be forced. therefore. to essentially adopt all of the language contained in the 10 Senate titles without any substantive change whatsoever. and report these titles back to the House. Under the House rules. as Members of the House know. these 10 titles of the Senate bill. not germane to the House bill. would all be subject to challenge under the germaneness rule and therefore subject individually to separate votes. Under this kind of scenario. any reasonable person would have to conclude the House would reject any and all of these 10 titles. simply because neither the House nor its Banking Committee would have had an opportunity to address these issues in a normal legislative fashion. I have discussed these matters with a number of members of the House Banking Committee on both sides of the aisle and with the Leadership of the House. This morning I met with the Democrats in a committee caucus. There is a strong consensus in favor of dealing with the very important issue of FSLIC now. and taking up the other issues in S. 790 in regular orderwith hearings and the opportunity for the committee and the House to work its will. It is therefore my considered opinion to proceed in regular order. towit: It Is my Intention(a) to seek expeditious action by the House on H.R. 27. the FSLIC recapitalization legislation. and (b) to have S. 790 referred to the House Committee on Banking. Finance and Urban Affairs for its consideration. It is my intention to have the Financial Institutions Subcommittee of the House Banking Committee proceed to full hearngs on the matters contained in S. 790 as well as others. I believe approaching this matter in a regular order fashion. is not only best for the legislative process but will provide the best legislative outcome on all of the issues.