Finally – the U.S. Senate is scheduled to debate a Financial Reform Bill sometime during the upcoming two weeks. In December, the House of Representatives passed HR 4173 and now Senate will be taking up the matter soon (see the full Financial Reform Bill Summary in Part 1 of this series).
The Senate Financial Reform Bill Summary differs in some major ways from the House bill, and before any of the Financial Reform Bill summaries become law, they must be reconciled, approved again, and signed by the President. So exactly how different is the Financial Reform Bill Summary to providing same day cash loans to financial companies from the House bill, and what will the final Financial Reform Bill most likely include?
Financial Reform Bill Summary on S 3271
S 3271, better known as the Restoring American Financial Stability Act of 2010, is currently in committee debate. Both the Senate Banking Committee and Senate Agriculture Committee (yes, agriculture) have the bill under debate right now, and when those bills emerge they must be melded. To meld the two committee bills, Harry Reid is expected to offer a compromise of some kind soon. If the amended version of S 3271 is approved by the Senate, the bill must be reconciled with HR 4173 before it becomes law.
HR 4173 similar to S 3271 Financial Reform Bill Summary
Although the House and Senate Financial Reform Bill are widely different, there are some similarities. Both financial reform bills ask Hedge funds and Private equity firms to register with the government and submit to oversight. Both bills give the Securities and Exchange Commission new authority, including regulatory powers. In both bills, shareholders are also given a non-binding advisory vote on executive compensation. Both financial reform bills also create a council to monitor financial risk in the economy. The government would also be able to seize and disassemble large failing companies, though the details of how are different.
S 3271 Summary covers Financial Reform Bill Consumer Protections
Mostly built into the Federal Reserve are the consumer protections in S 3271. On anything from payday loans no fax to credit cards and mortgages, a division within the Federal Reserve would be charged with writing and enforcing new rules about financial products.
Bank regulation on the Financial Reform Bill Summary
In addition to being held responsible for consumer protection, the Federal Reserve would also oversee any bank that has more than $ 50 billion in assets; this includes “non-bank lenders” – like mortgage companies. Federal Reserve regulators would be given the ability to force a bank to either reduce or stop risky financial transactions.
Financial Reform Bill S 3271 Summary on companies Too Big To Fail
While both the House and Senate bills have a provision allowing the government to break up failing financial companies, the Senate bill includes a funding provision. Large financial companies would be required to pay into a $ 50 billion FDIC-like fund that would finance the dissolution of failing firms.
S 3271 Financial Reform Bill | Derivative Regulation
The Senate bill aims to regulate derivative products, which is much like the House bill. The debate right now is on how derivatives will be subjected to oversight, and most likely the original writing of the bill will be changed with last-minute political maneuvering.
Restoring American Financial Stability Act of 2010 – this is a summary of the Senate bill 3271. If this bill passes the Senate, it must be reconciled with HR 4173, Wall Street Reform and Consumer Protection Act. In the end, the Financial Reform Bill Summary will most likely include the major provisions of both of these bills, though the details of regulation and financial reform could differ greatly.
Sources:
Reuters
Daily Finance
OpenCongress.org
Wall St Journal
