Looking to peer deeper into Federal Reserve activities, House and Senate lawmakers negotiating a massive financial regulation bill agreed to expand congressional scrutiny of the nation's central bank.

Senators on a panel assembling a final regulatory bill accepted a House plan Wednesday that would permit Congress' investigative arm to examine the central bank's most significant transactions.

Critics of greater congressional oversight of the Fed have argued it would threaten the central bank's independence.

The panel is bridging differences between House and Senate versions of a sweeping overhaul of the rules that govern Wall Street. Wednesday's agreement would authorize the Government Accountability Office to audit emergency Fed infusions to financial institutions, low-cost loans the Fed provides to banks, and the purchase and sale of securities that the Fed undertakes to set monetary policy.

"The Fed is going to be a lot more transparent, a lot more subject to review," said Rep. Melvin Watt, D-N.C.

To allay Fed fears about the expanded audit, lawmakers agreed to delay the public release of details of emergency transactions by one year. Other transactions would be disclosed after two years.

The audit provision was one of the few solid agreements on a day otherwise marked by offers and counteroffers between House and Senate negotiators. Democrats, who hold majorities in both chambers, want to get a final bill to President Barack Obama by July 4.

Senate Banking Committee Chairman Chris Dodd, D-Conn., was ready to drop a provision in the Senate bill that would require the president to appoint the head of the Federal Reserve Bank of New York. There are 12 regional Fed banks, but most of the largest banks in the country are supervised by the New York Fed.

Instead, House Democrats are recommending that bankers who sit on the Fed's regional bank boards be denied a vote on presidents of the regional boards.

The overall legislation aims to prevent a recurrence of the 2008 financial meltdown by requiring more government attention to potential risks in the financial system. Among the still unresolved issues before the House-Senate panel are key questions on how far to restrain bank activities and how to regulate the complex securities known as derivatives.

One of the stickiest issues centers on a proposal in the Senate bill, inserted by Sen. Blanche Lincoln, D-Ark., that would force banks to spin off their derivatives business to subsidiaries. Banks oppose it and the issue has raised concerns among members of the New York congressional delegation that it damage the region's economy.

This week, New York Mayor Michael Bloomberg sent lawmakers a letter opposing the Lincoln measure, saying it would cost the city jobs and increase profits and market share for foreign competitors.

Separately, senators and House members were negotiating how much authority to give shareholders of publicly owned companies to nominate candidates for corporate boards of directors. Dodd proposed that only shareholders who have owned 5 percent or more of a company's outstanding shares for at least two years would have the right to nominate directors.

Corporations fiercely oppose the proposal and Republicans unsuccessfully moved to strike it from the legislation. If shareholders gain that right, Sen. Bob Corker, R-Tenn., warned, "directors will be responding to the whim of the day."

Rep. Barney Frank, D-Mass., who is chairing the negotiating committee, was not ready to embrace Dodd's 5 percent threshold.

"Five percent is a lot to have to own in a company to be able to get involved," he said.