The creation of such securities has been torrid recently; $124.1 billion was issued last year, compared with $82.61 billion in 2013, according to S&P Capital IQ. Among the banks with the largest C.L.O. exposures are JPMorgan Chase and Wells Fargo; according to SNL Financial, a research firm, JPMorgan Chase held $30 billion and Wells Fargo $22.5 billion in the third quarter of 2014, the most recent figures available. The next-largest stake — $4.7 billion — was held by the State Street Corporation.

Given the size of these positions, it’s not surprising the institutions want more time to jettison them. But the new legislation represents Wall Street’s second reprieve on these instruments. After banks objected to the sale of their holdings last spring, the Federal Reserve gave them two years beyond the initial 2015 deadline to get rid of them.

Now they want another two years.

Although the top three banks had unrealized gains in their C.L.O. holdings in the third quarter, SNL said some banks were facing losses. And that was before the collapse in the price of oil, which has undoubtedly pummeled some of these securities.

A second deregulatory aspect in the Fitzpatrick bill relates to the lucrative private equity industry, which remains loosely regulated. The bill would exempt some private equity firms from registering as brokerage firms with the S.E.C. Under securities law, such registration is required of firms that receive fees for investment banking activities, like providing merger advice or selling debt securities.

Private equity firms are typically registered only as investment advisers, so submitting to broker-dealer regulation would result in more frequent examinations and more rules.

These firms don’t like that. But their investors could benefit from closer regulatory scrutiny of costly conflicts of interest in these operations. For example, a private equity firm providing merger advice to a company its investors own in a fund portfolio — not an arm’s-length transaction — could easily charge more for those services than an unaffiliated firm would.

Finally, the bill’s changes in derivatives would reduce transparency and increase risks in this arena by allowing Wall Street firms with commercial businesses — like oil and gas or other commodities operations — to trade derivatives privately and not on clearinghouses.