Senator Christopher Dodd chairman of the Senate Banking Committee, is ready to push through a controversial financial regulation reform bill with or without Republican support, senior aides said, just days before the House of Representatives votes on its own reform legislation.

As momentum builds again behind a push by the Obama administration and Democrats for tighter bank and capital market regulation, analysts said banks, brokerages, insurers and other financial services businesses could face new regulatory burdens and costs.

We expect that the final bill will pose significant costs and risks to the financial industry, said Dan Alamariu, an analyst at the Eurasia Group, a research and consulting firm that follows Washington politics closely.

Timing is still uncertain. The House is expected to approve a bill this month, possibly as soon as Friday.

The Senate has a long way to go, with much depending on Dodd. Senate Democratic leaders are aiming for final passage in March 2010, Alamariu said.

But he added: This timeline is probably too ambitious. A final bill is unlikely before the April-May time frame. The still-ongoing healthcare debate and significant differences between the House and the Senate packages that will require conference committee harmonization could push final passage of the package even into mid-2010.

Dodd is a consensus builder by nature. He has moved more slowly on financial reform than his counterpart in the House, Representative Barney Frank, chairman of the Financial Services Committee.

Frank's committee completed its work on a sweeping package of proposals last week, with some of them approved in recent months on closely fought party-line votes.

A similar outcome would not be typical of Dodd's panel, but senior aides said it could come to that. They said Dodd wants to move a bill out of the committee before year-end.

He faces a tough re-election battle at home in Connecticut in November and has lately shown a willingness to defy Wall Street and press forward, despite resistance from Republicans.


On November 10, Dodd unveiled a sweeping financial reform bill that leaped beyond earlier proposals. Senate Republican Leader Mitch McConnell said it was a long way from being ready to go forward on any bipartisan basis.

Since then, Dodd has divided his committee into bipartisan task forces, each assigned a different aspect of the bill.

Even Republicans said last week that progress was being made. I very much appreciate what he's trying to do to work out a bipartisan bill, and I think we're going to do that, said Tennessee Republican Senator Bob Corker at a hearing last week.

Like Frank's bill, Dodd's measure calls for cracking down on the over-the-counter derivatives market, hedge funds, credit rating agencies and executive pay, as well as stiffening government safeguards for consumers and investors.

A new protocol would be set up to deal with big financial companies seen as too big to fail if they get into trouble, without using bailouts, and to keep a close eye on their business decisions and their financial health.

Both the House and Senate bills would also, for the first time, set up a federal office to monitor the insurance business.

The House will continue to move forward with financial regulatory reform, with a vote coming as soon as next week, said Paul Miller, an analyst with investment firm FBR Capital Markets. However, all of the available legislative bandwidth in the Senate is being absorbed by healthcare legislation ...

Should the House pass financial regulatory reform next week, as expected ... the Senate may not take up the issue until spring 2010 at the earliest, Miller said.

(Reporting by Kevin Drawbaugh; editing by Jeffrey Benkoe)