The House is poised to pass a bill that will keep Walmart, and all who seek to follow them, from ever having a bank to call their own. The measure, H.R. 698, prevents industrial loan companies (ILCs) from being owned or chartered by any institution that doesn’t derive at least 85% of their revenue from financial activity.
ILCs are state-chartered banks that can issue credit cards, offer loans, and occasionally accept deposits. After Walmart, Home Depot, and DaimlerChrysler all filed applications for ILCs earlier this year, the FDIC issued a moratorium on new charters and asked Congress for some hot legislative action.
Only seven states charter ILCs, but most have limited or banned applications from commercial firms. Only Utah still encourages the practice, and their 32 ILCs hold over $186 billion in assets.
The measure will be considered tonight on the suspension calendar, which allows for 40 minutes of debate. No amendments are allowed and a two-thirds vote is required for passage. The measure is expected to pass easily, after which it will move onto the Senate where it will run smack into Senator Robert Bennett (R-UT,) who served the people of his state by killing a similar measure in the 109th Congress. — CAREY GREENBERG-BERGER
Update: The House passed H.R. 698, 371-16, with the entire Utah delegation voting nay.