–Key Republican Senator: ‘We’re Not There Yet’ on Fin Regulatory Bill
–Ending ‘Too Big To Fail’ Is Central Issue For Him
–Fed Has Made ‘Lot of Mistakes’ But Still ‘Important’

By John Shaw

WASHINGTON (MNI) – Sen. Richard Shelby, the ranking Republican on
the Senate Banking Committee, told Market News International Tuesday
that he continues to work with Banking Committee Chairman Chris Dodd on
a “consensus” regulatory reform bill.

“But we’re not there yet. I hope we can get there. I don’t know if
we can,” Shelby said.

He adding that it should be clear “in the next couple of weeks” if
a bipartisan agreement is possible.

“We’re still talking, we’re still consulting. There are a lot of
areas of agreement. But there are also some differences. Some important
differences,” Shelby said.

The key Senate Republican said the paramount issue for him is
finding a workable and effective way to end “Too Big To Fail.”

“We’ve had way too many bailouts. We have to end them. We have to
make sure they don’t happen in the future,” he added.

Shelby said the future role of the Federal Reserve Board is also a
critical element that needs to be resolved in the coming weeks.

“As we all know, the Fed made a lot of mistakes over the years. We
can’t forget that. But the Fed is the Fed and is going to have an
important role in the future. We have to figure out what it is,” he
added.

The full Senate is expected to begin debating financial regulatory
reform the week of April 26.

The Senate Banking Committee approved Dodd’s regulatory reform bill
on March 22 on a party-line 13 to 10 vote. All Democrats supported the
bill and all Republicans opposed it.

Dodd’s legislation 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.

Under Dodd’s bill, the Federal Reserve would oversee bank holding
companies with assets over $50 billion. Dodd’s bill also would require
the president of the New York Federal Reserve Board to be appointed by
the President of the U.S. and confirmed by the Senate.

Senate Majority Leader Harry Reid has said he is putting financial
regulatory reform legislation on a fast track, adding he wants the
Senate to pass a regulatory reform bill by the end of May.

President Obama has said that financial regulatory reform is one of
his chief goals for the rest of this legislative session. He will meet
Wednesday with congressional leaders to discuss the issue.

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

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