FROM THE OFFICE OF PUBLIC AFFAIRS

The Administration is disappointed by the recommendations on the Financial Modernization bill put forth by Chairmen Gramm, Leach, and Bliley today. A flawed process risks producing flawed legislation. In important respects, the Chairmen's proposal abandons the bipartisan consensus that the House legislation achieved. On each of the four key areas cited by the President -- business choice, the Community Reinvestment Act, consumer protections, and banking and commerce-- the recommendations are inadequate. If the bill were presented to the President in its current form, the President would veto the bill.

The right financial modernization legislation can make an important contribution to the strength of our economy. We remain willing to work cooperatively towards a bill that meets the President's requirements.