A controversial provision of the financial reform bill could further tighten the bind on banks still participating in the government bailout program.

Bank securities held by the Treasury Department through the Troubled Asset Relief Program would no longer count toward a banking company's Tier 1 capital under the Senate's version of the reform bill, legal experts said. That boost to Tier 1 capital was a key reason some banks chose to participate and why many remain. For many of them, keeping that capital support could be the reason they survive the prolonged economic malaise.

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