–Senate Will Vote At 11 A.M. ET To End Debate; 60 Votes Required
–If Senate Clears Procedural Hurdle, Final Passage Assured
–Senate Democrats Seek Final Regualatory Reform Vote Today

By John Shaw

WASHINGTON (MNI) – The Senate will vote at 11 a.m. ET Thursday to
end the debate on financial regulatory reform legislation, a key
procedural vote that will require 60 votes.

If the Senate votes to end the debate, as is expected, final
passage is assured, possibly even later in the day.

Since the House has already passed the regulatory reform bill, once
it is approved by the Senate it will go to President Obama for his
signature.

If 60 senators vote Thursday to end the debate on the regulatory
reform bill, the Senate could still theoretically debate the matter for
another 30 hours.

But there would be strong pressure for opponents to yield back some
of the time.

Senate Majority Leader Harry Reid said Wednesday that it would be a
“waste” of time to use all of the 30 hours.

But, he added that if Republicans demand to use those 30 hours the
final Senate vote on regulatory reform will be held Saturday.

While it will only require a majority vote in the Senate to pass
the bill, Democratic leaders need 60 votes to cut off the debate in the
upper chamber.

Of the 58 Democratic and independent senators, 57 are expected to
vote for the final bill. Only Sen. Russ Feingold, a Democrat from
Wisconsin, has said he won’t vote for the legislation.

Four Senate Republicans voted for the Senate’s regulatory reform
bill in late May: Scott Brown of Massachusetts, Susan Collins and
Olympia Snowe of Maine, and Chuck Grassley of Iowa.

Collins, Snowe and Brown have said they will vote for the bill;
Grassley has said he will oppose the bill.

The underlying bill would create a council of regulators to monitor
the economy for systemic threats. It would institute new regulations on
hedge funds and over-the-counter derivatives and create a Bureau of
Consumer Financial Protection that will oversee mortgage, credit cards
and other credit products.

The bill provides for expanded audits of the Federal Reserve by the
Government Accountability Office. The GAO would conduct a one time audit
of all the Fed’s emergency loan programs that were created during the
financial crisis. It would also have the authority to audit future
emergency lending and other Fed transactions, with a two year delay in
releasing the results.

The bill includes a variation of the Volcker-rule, banning banks
from proprietary trading and limiting them from investing in or
sponsoring hedge funds and private equity funds. It limits bank
investments in private equity or hedge funds to 3% of a fund’s capital.
Total investment in private equity and hedge funds can’t exceed 3% of a
company’s tangible common equity.

The legislation would push most OTC derivatives through third party
clearinghouses and onto exchanges or electronic trading systems. It
would force banks to push some of their swaps trading into subsidiaries.

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

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