Next Step for Regulatory Reform: House and Senate Reconciliation

May 3, 2010 — Following several days of failed procedural votes last week, the Senate has agreed to debate and offer amendments to S. 3217, the Senate financial regulatory reform bill.

Debate on amendments is expected to begin as early as May 4.

Senate Banking Committee Chairman Chris Dodd's (D-Conn.) bill has sparked partisan controversy, resulting in days of Republican filibuster blocking debate on the bill. The legislation is a comprehensive package addressing consumer protection, systemic risk and "too big to fail." Several issues have divided Senators among party lines, most notably the treatment of derivatives and the creation of a consumer protection bureau at the Federal Reserve.

The consumer bureau would have rule writing and enforcement powers and a director appointed by the President and confirmed by the Senate. Like the House bill, credit unions under $10 billion in assets will continue to be examined by the NCUA or the state regulator for consumer protection.

NASCUS wrote to Senate leaders recently to encouraging them to defend against further federal preemption in the regulatory reform legislation and to involve state regulators more fully in systemic risk mitigation and consumer protection. To view the letter, click here.

NASCUS will provide updates as developments continue on the Senate floor.