Senate Banking Committee Chairman Chris Dodd (D-Conn.) aims next week to unveil legislation to overhaul the financial industry.

While the House passed legislation in December with major new regulations of financial markets, action in the Senate has been bogged down for the last year in disputes between Democrats and Republicans.

Dodd aims to hold a markup of the financial legislation the week after next, his spokeswoman said.

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The most contentious aspect of the overhaul has been an Obama administration proposal to create a new federal regulatory agency for consumer financial products. The House passed legislation creating the Consumer Financial Protection Agency (CFPA), which would regulate products such as home loans, credit cards and payday loans.

The financial industry has lobbied aggresively against the proposal and Republicans in the House and Senate are unanimously opposed to a freestanding agency. They argue it would it be a cumbersome imposition that would increase costs for consumers and limit their access to credit.

Supporters say it is a necessary agency that has the chief responsibility for looking out for consumers.

The financial overhaul packages include new regulations to oversee risk across the financial system, dissolve failing financial firms and oversee the now-unregulated market for financial derivatives.

Senators are looking to create a new council of financial regulators, with the Treasury Department at the head, to assess risks in the system.