TAKING LOOK AT BANKS' REACH; FINANCIAL SECTOR PLAN SCALED BACK.
Byline: The New York New York, state, United States
New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of Times
Retreating from its most ambitious idea - allowing banks to own manufacturers or other nonfinancial companies - the Clinton administration Noun 1. Clinton administration - the executive under President Clinton
executive - persons who administer the law Wednesday introduced a long-awaited plan to revamp re·vamp
tr.v. re·vamped, re·vamp·ing, re·vamps
1. To patch up or restore; renovate.
2. To revise or reconstruct (a manuscript, for example).
3. To vamp (a shoe) anew.
n. the nation's financial services The examples and perspective in this article or section may not represent a worldwide view of the subject.
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For more than a decade, repeated attempts to overhaul banking legislation have collapsed from intense industry infighting in·fight·ing
1. Contentious rivalry or disagreement among members of a group or organization: infighting on the President's staff.
2. Fighting or boxing at close range. . In deciding not to press for authority for banks to engage in virtually any business - a proposal that has drawn sharp criticism - the administration has provided the framework, analysts said, for a bill with solid prospects of enactment.
The plan, outlined Wednesday by Treasury Secretary Robert Rubin Robert Edward Rubin (born August 29, 1938) is an American banker who served as the 70th United States Secretary of the Treasury during both the first and second Clinton Administrations during a time of peak performance for the U.S. economy. , is an attempt to reflect the deregulatory changes that have already swept through the marketplace, paced by the efforts of federal regulators that have allowed banks and Wall Street to move onto each other's turf.
In a speech at the Exchequer Exchequer
English government department responsible for receiving and dispersing public revenue. It was established by Henry I in the 12th century, and its name refers to the checkered cloth on which the reckoning of revenues took place. Club in Washington, D.C., Rubin predicted that increased competition in the securities, banking and insurance industries would produce savings of as much as $15 billion for consumers.
Financial industry groups gave the administration's outline cautious support pending its refinement over the next couple of weeks. ``The devil's in the details,'' said Paul A. Equale, senior vice president of the Independent Insurance Agents of America.
While Rubin signaled a retreat from the controversial proposal to allow banks to venture into a wide range of businesses, he did not abandon it all together. The administration's plan offers such ownership as one of two alternatives.
Rubin suggested that permission for banks be linked to a specified limit on nonfinancial activity, expressed in terms of total domestic revenue. He also said that Congress might want to bar affiliation between a bank and any of the nation's 1,000 biggest nonfinancial companies.
No percentage was mentioned, but the Treasury is expected to accept a limit of 25 percent on nonfinancial business.
Critics of commercial ownership by banks argue that such authority could lead to an overconcentration of economic power.