Financial industry outreach as regulation looms

Obama administration officials are ramping up their outreach to financial industry representatives ahead of their expected announcement next week for sweeping new regulations.

After a round of meetings last week with industry lobbyists, officials at the White House and Treasury are slated to meet with insurance industry CEOs on Wednesday and insurance trade association representatives on Thursday, two industry sources said on Monday.

The administration continues to work through its proposal to overhaul the nation's financial regulations and the industry expects an outline or "white paper" of possible changes next week. Meanwhile, the House Financial Services Committee is tentatively scheduled to hold hearings on regulatory restructuring as early as June 9.

Some of the proposed changes reported last week drew stiff criticism from lawmakers and lobbyists alike. Rep. Barney Frank (D-Mass.), chairman of the financial services committee, said he was opposed to a plan -- that industry sources said was under discussion -- to consolidate the four different bank regulators.

Setting up a "systemic risk regulator" and creating a new way to resolve large non-bank firms whose downfall would threaten the broader economy are two of the possible proposals that have received the strongest support so far.

One persistent question is what impact the new regulations will have on the insurance industry.

"All these programs have been bank focused as they should have been. Now looking forward if you're going to fundamentally restructure everything you’re going to have take insurance into account," said one insurance industry lobbyist.

The Thursday meeting will include about eight of Washington's main insurance industry trade associations, said an industry source, who characterized the meeting as a "listening session."