House panel backs financial consumer watchdog

WASHINGTON (Reuters) - A key U.S. congressional committee on Thursday voted to support creation of a Consumer Financial Protection Agency, approving legislation that had been trimmed back from an Obama administration proposal.

The agency is a central part of President Barack Obama's sweeping plan to tighten bank and market regulation after the worst financial crisis in generations. It would regulate mortgages, credit cards and many other financial products.

The House of Representatives Financial Services Committee voted to back the bill only after exempting a wide range of businesses from the proposed agency's jurisdiction, including small banks, auto dealers and insurers.

A vote by the full House is expected next month.

(Reporting by Kevin Drawbaugh, Editing by Chizu Nomiyama)