Wisconsin charter legislation defeated

Northwestern Financial Review, Sep 1, 2001

For the sixth year in a row, a universal bank charter proposal has failed in the Wisconsin legislature. Earlier this year, when the bill appeared likely to pass, WBA legislative vice president Kurt Bauer was unwilling to celebrate. In May, Bauer expressed concern over last minute amendments. His reserve proved wise after the Legislature announced in June its finalized budget minus the compromised charter package. But the battle isn't over.

"The legislation still exists," said Bauer. "It is still the WBA's top legislative priority."

In past years, the legislation was pitted against a separate bill concerning credit unions. Bauer said credit union and bank lobbying efforts were stalling both bills. The sides negotiated a compromised joint bill this year. The banking lobby agreed to allow the credit unions to seek codification of powers already broadly interpreted by the state's Department of Financial Institutions as valid. "These are advantages the credit unions essential have already, so we agreed to that," Bauer said.

The universal bank charter portion of the bill grants state chartered institutions the same powers afforded federal institutions under GrammLeach-Bliley. "We don't want state chartered institutions to feel they must convert in order to take advantage of financial modernization," Bauer said.

The bill has gained momentum each year it has come before the Assembly. Bauer said this year it had a great deal of bipartisan support and many co-sponsors in both houses, but was linked to a super-priority wage lien bill, which became its undoing.