Lawmakers Reach an Agreement
                   On Financial-Services Reform Bill

                   By ALAN YONAN and DAWN KOPECKI
                   Dow Jones Newswires

                   WASHINGTON -- Lawmakers working on the finishing touches to a
                   broad financial-services reform bill early Friday reached a deal on the
                   controversial community-lending provisions tucked inside the broader bill.

                   The agreement, which was struck just before 2 a.m. EDT during a
                   five-hour, closed-door meeting in a side room off of the House Banking
                   Committee room, wasn't yet formally outlined on paper. Lawmakers
                   verbally agreed to temporarily adopt the provision without actual written
                   amendments until staff can write up the legislative language.

                   "I am for the first time optimistic that we will
                   pass, after a long time, financial-services
                   legislation," said Sen. Chuck Schumer (D.,
                   N.Y.). "In 19 years, we are the closest we
                   have ever been to actually achieving a bill.
                   They said it couldn't be done. I'm not sure that
                   we've done it. But I am optimistic."

                   Lawmakers were trying to come to terms with
                   changes Senate Banking Chairman Phil
                   Gramm (R., Texas) made to the 1977
                   Community Reinvestment Act, or CRA.

                   The compromise on community-lending
                   requirements was supported by Treasury
                   Secretary Lawrence Summers, essentially removing the threat of a
                   presidential veto.

                   The Treasury Department and White House had expressed concern that
                   previous versions of the bill would allow financial institutions with
                   unsatisfactory CRA ratings to enjoy the new powers allowed under the bill.

                   "Nothing is done until the language is fully reviewed, but we are very
                   pleased that the community reinvestment "have and maintain" principle(s) ...
                   have been met," Mr. Summers said in a prepared statement.

                   The White House was adamant about requiring banks to have not just a
                   satisfactory CRA rating but to also maintain that grade whenever a bank
                   wants to expand or add new services to its offerings.

                   Under current law, federal regulators review a
                   bank's CRA performance, but a good grade isn't
                   required to get approval for mergers or other
                   activities.

                   Mr. Summers also said significant improvements
                   were made in other areas of the bill, citing a
                   controversial proposal to require banks to disclose
                   the details of agreements they have made with
                   community groups involving CRA. The bill is part
                   of a two-decades-long effort to revise the
                   Glass-Steagall Act, a law passed in 1933 that has
                   essentially barred commercial banks, insurance
                   companies and investment banks from entering each other's business.

                   "We have a good compromise. We have significant regulatory relief, a
                   comprehensive disclosure measure," Mr. Gramm said. Above all, Mr.
                   Gramm said, he thinks President Clinton will sign it.

                   House Banking Chairman Jim Leach (R., Iowa) adjourned the conference
                   just before 3 a.m. EDT, closing the bill to further public debate. "There is a
                   very, very strong provision that is critical," Mr. Leach said.

                   He was referring to the "have and maintain" provision. That "allows CRA
                   to be considered if a bank is out of compliance and this was the most
                   important provision to the Treasury and to the White House," Mr. Leach
                   said.

                   The CRA agreement would also give small banks some regulatory relief,
                   allowing those with less than $100 million in assets and outstanding CRA
                   grades to escape an exam for five years. Those under the same asset limit
                   and with a satisfactory rating would have to undergo an exam every four
                   years.

                   Small banks generally undergo a CRA review every 18 months to three
                   years under current practices.

                   Mr. Leach said lawmakers spent most of their time haggling over the
                   disclosure provision Mr. Gramm wants to impose on banks that lend or
                   give money to community groups as a way to ward off protesting over
                   CRA. Disclosure agreements would be required for most grants of more
                   than $10,000 and loans of more than $50,000, Mr. Leach said.

                   Mr. Gramm spent much of the week debating that specific provision with
                   Mr. Summers.

                   "The reason why grown men spend hours talking about periods and
                   commas and modifying clauses is because when you're talking about
                   billions of dollars. Those things mean a lot," Mr. Gramm said at a press
                   conference earlier in the day.