(Reuters) - Dozens of amendments have been circulating as the U.S. Senate begins debate on a sweeping bill to overhaul financial regulation.
The following are snapshots of some of them, which the Senate will be dealing with over the next two weeks or so:
* Drop swap-trading desk spin-off rule
The amendment would kill a provision of the Democrats’ bill that would force banks to divest their swap-trading desks.
* Strengthen “Volcker rule”
The amendment would strengthen a part of the main Democratic bill dealing with a proposal from President Barack Obama and economic adviser Paul Volcker that would bar banks from proprietary trading for their own accounts, unrelated to the needs of their customers. The amendment would widen the rule to apply not only to banks, but also to large, interconnected nonbank financial institutions.
* Reinstate Glass-Steagall
Financial giants could be broken up under an amendment to reinstate the 1930s-era Glass-Steagall laws that barred large banks from affiliating with securities firms and insurers.
Those limits were largely repealed in 1999, a high-water mark for deregulation that critics say marked the beginning of changes that culminated in the 2008-09 financial debacle.
Passage of the amendment could force firms at the center of the crisis -- such as Goldman Sachs, Morgan Stanley, Citigroup, JPMorgan Chase and Wells Fargo -- to spin off investment and insurance operations.
* Prohibit use of taxpayer funds in bailouts
Amendment clarifies that all troubled financial companies put into receivership must be liquidated, and bans the use of taxpayer funds to bolster an institution instead of liquidating it.
* Bonus excise task
The amendment would impose a 50 percent tax on 2009 bonuses considered “excessive” at firms that received extraordinary taxpayer assistance.
* Make consumer watchdog an agency
The Democrats’ bill would create a financial consumer watchdog bureau inside the Federal Reserve that would regulate mortgages and credit cards. Some Democrats want the watchdog to be an independent agency with more independence and clout than a Fed unit and will offer an amendment to do that.
* Limit size of banks as percentage of GDP
The amendment would impose a strict cap of 10 percent on any bank holding company’s share of total insured U.S. deposits. It would limit the size of non-deposit liabilities at financial institutions to 2 percent of gross domestic product for banks, and 3 percent of GDP for nonbank institutions. And it would set a 6 percent leverage limit for bank holding companies and selected nonbank financial institutions.
* Auto dealer exemption
Amendment would exempt auto dealers from the full reach of the consumer watchdog if the dealers do not do finance their own lending to car buyers.
* Private equity, venture capital fund oversight
The amendment would require managers of private equity and venture capital funds to register with the Securities and Exchange Commission. The Democratic bill in the Senate would only require hedge fund managers to register with the SEC.
* Reversal of Supreme Court ruling on Stoneridge
The amendment would clear the way for shareholders to sue third parties such as banks, lawyers and accountants that are not directly involved in a securities fraud cases.
A 2008 Supreme Court decision in the Stoneridge case helped protect those that aid and abet financial fraud.
* Auditing the Federal Reserve
This amendment would affect the Government Accountability Office’s authority to audit the Fed. Currently, the GAO is banned from auditing monetary policy and interaction between the Fed and other central banks.
* Disclosing short positions in financial products
The amendment would require sellers of financial products or instruments to disclose to the purchaser of that product, whether the seller has any direct financial interest in the decline in value of the product.
The proposal comes as the SEC pursues a fraud case against Goldman Sachs for failing to tell clients that the debt securities they were buying had input from hedge fund Paulson & Co, which stood to benefit if the securities lost value.
* Changing assessment base for deposit insurance
Amendment would shift the fee burden to larger banks, by making assessments for deposit insurance based on assets, instead of deposits.
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