Public Papers - 1991 - May
Letter to Congressional Leaders on Banking Reform Legislation
Dear Mr. Chairman: (Dear Senator:)
As the Committee on Banking, Housing, and Urban Affairs moves forward with legislation addressing banking reform, let me reiterate my strong support for the Administration's proposal to modernize the Nation's financial system. I believe the time has come to address the fundamental problems of our banking system. We must have a comprehensive legislative solution to fuel economic growth through stronger, more competitive banks -- ones that are better able to lend to customers in good times and bad. Without comprehensive reform the economy is exposed to the potential of future credit crunches. This is why the Administration has proposed such broad-based reforms.
A bill that would merely recapitalize the Bank Insurance Fund and make minor changes to the law would be shortsighted. We must fix the fundamental problems in the banking industry, not just fund them. If the Congress fails to adopt a broad-based solution along the lines I have suggested, we may have to face another recapitalization of the insurance fund. This additional exposure of the Bank Insurance Fund imposes risks on savers and taxpayers that no one can seriously desire.
We have taken the first step toward comprehensive reform by laying a broad-based proposal before the Congress. Let us now work together to craft the broad banking reform legislation that this country needs.
Note: Identical letters were sent to Senators Donald W. Riegle, Jr., and Jake Garn, chairman and ranking member of the Senate Banking, Housing, and Urban Affairs Committee.