Republican Congressman Scott Garrett is expected to introduce a new covered bond bill soon, ahead of a House Financial Services Committee hearing taking place at the end of next week, in a renewed effort to establish a US legislative framework for covered bonds.

The US Covered Bond Act of 2010 was approved by the full House Financial Services Committee in July 2010, but did not make it onto the statute books last year. A first Senate Banking Committee hearing on covered bonds took place in September, where Federal Deposit Insurance Corporation concerns were raised.

The hearing next week, on Friday 11 March, is of the HFSC subcommittee on capital markets and government sponsored enterprises, which Garrett chairs. It is due to be a legislative hearing, meaning that rather than just debate the subject of covered bonds, as the Senate Banking Committee did in September, it will discuss a legislative proposal. A new bill from Garrett would be his sixth such proposal.

Witnesses at the hearing will include Bert Ely, a financial institutions and monetary policy consultant, and Tim Skeet, an International Capital Market Association board member and consultant at Amias Berman.

Ely told The Covered Bond Report that he expects the new bill to make it through the House this year.

Following mid-term elections late last year, a Republican, Spencer Bachus, now chairs the HFSC, having taken over from Democrat Barney Frank.

“The big question is: where do things stand right now over on the Senate side?” added Ely.

A Democrat still chairs the Senate Banking Committee, although Tim Johnson has taken over from Christopher Dodd. Republican Senator Bob Corker previously championed covered bonds in the committee and is expected to do so again.

Skeet, who will be representing ICMA at the hearing, said that his participation will provide the opportunity to give a European perspective on developments, something that has not been done in either the previous House or Senate hearings.

“We see this as the opportunity to formally set out the performance of covered bonds during the crisis on the record in the US, because we feel that the story has not been adequately or fully described so far,” he told The Covered Bond Report.

He added that this could help dispel fears in the US about any need for governments and taxpayers to have to provide financial support or guarantees for the market in times of stress, one concern that has been raised by those sceptical about covered bonds in the US.