–Senate Banking Committee Chief Sees Votes on Boxer, Shelby-Dodd Amends
–Sen. Dodd: He and Shelby To Offer ‘Too Big To Fail Amendment
–Senate Majority Leader Reid Says GOP ‘Stalling’ on Reg Reform Bill

By John Shaw

WASHINGTON (MNI) – Senate Banking Committee Chairman Chris Dodd
said Wednesday that the Senate will cast its first votes on amendments
to the financial regulatory reform bill later in the morning.

In remarks on the Senate floor, Dodd said he expects the Senate to
vote around 11:30 a.m. on an amendment by Democratic senator Barbara
Boxer that would prohibit the use of taxpayer funds to bail out
financial firms in the future.

Dodd said that he expects a Senate vote on a second amendment
around 12:30 p.m. by himself and Sen. Richard Shelby, the ranking
Republican on the Banking Committee.

Dodd said the Dodd-Shelby amendment will clarify a process to
liquidate large failing financial institutions. It is expected to strike
language which would have created a $50 billion resolution fund to cover
the cost of winding down collapsing financial firms.

Some Republican senators have criticized this $50 billion fund
which Dodd said he incorporated into the bill to accommodate other
Republican senators.

Dodd said additional “more controversial” amendments will be
considered by the Senate in the coming days.

Dodd said he has been “frustrated” by the slow pace of the Senate
debate on regulatory reform, which began last week but has included no
votes yet on amendments.

He said it’s time to “get this process moving.”

Senate Majority Leader Harry Reid blasted Republicans on Wednesday
morning for trying to “stall” Senate work on the regulatory reform bill.

“We don’t have a lot of time to spend on this bill,” Reid said in
remarks on the Senate floor.

Reid said yesterday that he’s determined the Senate will complete
action on regulatory reform legislation by next week.

Senate Minority Leader Mitch McConnell has said the Senate must
take its time dealing with a bill with such a broad reach.

The Senate is debating the bill that was largely drafted by Dodd.

It establishes a new independent Consumer Protection Bureau at the
Federal Reserve Board, creates a process to liquidate failed financial
firms, sets up a council of regulators to oversee systemic risk in the
economy, establishes a regulatory structure for over-the-counter
derivatives, requires hedge funds that manage over $100 million to
register with the SEC and creates a new office within Treasury to
monitor the insurance industry.

Dodd’s bill has been merged with a package that was approved by the
Senate Agriculture Committee which requires OTC markets to adopt aspects
of the regulated markets such as mandatory clearing through derivatives
clearing organizations and trading on exchanges or exchange-like
facilities.

It has a narrow exemption for commercial “end users” who use
derivatives to hedge against economic contingencies such as fluctuations
in fuel prices, currency and interest rates.

The most controversial features of the package is a provision that
requires a bank that qualifies as a “swap dealer” or a “major swap
participant” to either divest its swap desk or forego access to federal
credit assistance such as the Federal Reserve Board’s discount window of
FDIC deposit insurance.

Republican senator Judd Gregg assailed the derivative provisions of
the package on the Senate floor Tuesday, saying they make “no sense” and
could undermine efforts to oversee the OTC derivatives market.

Senate Republicans have also said they will offer amendments to
alter the proposed consumer protection entity created by the Dodd bill.

If the Senate passes a financial regulatory reform bill, it must be
reconciled with a competing version that was approved by the House in
December.

President Obama has said he would like to sign a bill into law by
September.

** Market News International Washington Bureau: (202) 371-2121 **

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