Swaps subs revisited.

There's nothing like a swap at the top to give bankers new hope.

Now that Eugene A. Ludwig is comptroller of the currency, his staff is revisiting plans by several big national banks to spin off their derivatives operations into separately capitalized subsidiaries.

Citicorp and Continental Bank Corp. filed applications to create such subsidiaries in 1992, hoping that the units would win higher credit ratings than their parents and thereby win new business. But the companies withdrew their applications after the regulatory agency discouraged their plans.

Now, there is hope that Mr. Ludwig will see things differently. "The agency is currently revisiting this issue," confirmed an official at the Comptroller's headquarters.

Regulators are developing operational guidelines for banks that use or offer derivatives, Mr. Ludwig said in September. A measure allowing for separate swaps units may be included in those instructions, sources said.

The Comptroller's office remains concerned, however, that good assets will be sucked out of banks to fund the derivatives units.

"The big question is how do you capitalize it," the regulatory official said.

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