House and Senate lawmakers reached an agreement today on the most drastic overhaul of financial regulations since the Great Depression.
The negotiations, which lasted over two weeks, finally came to a compromise after a 20-hour-long meeting as the two chambers agreed to merge the competing bills.
The final details of the bill, titled the Dodd-Frank Act after its creators, include the creation of an agency to protect consumers in the financial marketplace and new regulations to reduce risk-taking by large banks to prevent a repeat of the financial crisis. The legislation still needs to be passed through the full House and Senate, and voting is aimed to be held next week. It is expected to have enough support to pass.
If so, President Barack Obama will sign the package into law by July 4.
“This is going to be a very strong bill, and stronger than almost everybody predicted that it could be and that I, frankly, thought it would be,” said House Financial Services Committee Chairman Barney Frank.
The panel consisted of 43 lawmakers who worked to dissolve the differences between the Senate and Congress bills. Democrats supported the agreement, but Republicans believe the bill could have unseen consequences on the financial markets and access to credit.
The legislation details include regulations such as the Volcker Rule, a rule that would limit insured banks’ speculative proprietary trading activities, the prevention of banks hedging their exposure to trades done on behalf of clients and a $19 billion levy on banks.
Obama has expressed his gratification of the compromise. He explained the bill includes about 90 percent of what he promised.