Washington, March 23 (DPA) The Senate Banking Committee Monday approved an overhaul of US financial regulation that aims to prevent another Wall Street-fuelled crisis from engulfing the US economy.
The committee approved by 13-10 a bill first proposed last week by its Democratic chairman, Christopher Dodd, which closes loopholes in the US regulatory structure and gives the Federal Reserve new powers to oversee the country's largest banks.
Financial regulation is considered President Barack Obama's next major domestic priority, after lawmakers on Sunday approved much-anticipated reforms to the health care sector following a bitter debate that dominated US politics for much of the past year.
"We are now one step closer to passing real financial reform that will bring oversight and accountability to our financial system and help ensure that the American taxpayer never again pays the price for the irresponsibility of our largest banks and financial
institutions," Obama said in a statement following the vote.
Public anger against Wall Street has been palpable in the aftermath of the 2008 credit crisis, which was brought on in part by the irresponsible lending practices of financial firms. The crisis sent the global economy spiralling into its first recession since World War II.
All Republicans on the panel voted against the reforms after talks between the two sides on a bipartisan proposal broke down last week. Richard Shelby, the top Republican on the committee, said he was hopeful a compromise could still be reached as the legislation makes its way to the Senate floor.
"We can and I believe will reach an agreement," Shelby said ahead of the vote. Many Republicans have warned that an over-reaction against banks could stifle innovation in the financial sector.
The reforms are considered some of the most sweeping since after the Great Depression of the 1930s. Dodd's legislation mirrors proposals by Obama and a competing version that was approved by the US House of Representatives last year.
Obama has said he wants the legislation to reach his desk for signature by the end of this year.