For comptroller's point man on funds, job is a balancing act.

WASHINGTON -- David P. Apgar might as well add "cartographer" to the list of credentials on his dazzling resume.

He is, after all, mapping out the course for the banking industry as it expands into mutual fund sales and management.

As senior policy adviser to the comptroller of the currency, Mr. Apgar is his agency's point man on one of the hottest issues in banking: how to supervise the industry's fast-growing securities activities.

It's a task few would envy.

Observers say Mr. Apgar, at 37 a veteran of both Wall Street and Capitol Hill, is at the center of a policy whirlwind. As banks press into investment sales, the agency has taken plenty of lumps for its efforts at monitoring the booming business:

* Members of Congress say the OCC is putting too much emphasis on protecting banks and not enough on guarding investors.

The Securities and Exchange Commission wants to wrest away the OCC's job of regulating bank sales of investments.

* Fellow banking regulators have resisted the OCC's efforts to win them over to a more activist regulatory stance.

'A Mediating Role'

"He's got his hands full," said a noted industry consultant, who did not want to be named. He sees Mr. Apgar's role as "mediating between Congress, the industry, and the administration, who all have different ideas" on how to ensure that mutual fund buyers at banks understand investment risks.

For his part, Mr. Apgar appears unfazed by the balancing act.

"The essence of making policy in this area is to take into account all of the conflicting objectives," he says, "and to figure out a way to prioritize and meet as many as possible."

In the 15 months since he joined the OCC; Mr. Apgar has overseen a series of policy initiatives in the mutual fund arena.

Among them: crafting investor-protection guidelines for banks that sell mutual funds; undertaking a review of banks' advertising materials; and laying the groundwork for a "mystery shopping" program to check up on banks' compliance efforts.

These efforts have earned Mr. Apgar high marks from his boss, Comptroller of the Currency Eugene A. Ludwig.

"He has an extremely difficult job, and he's done it well," said Mr. Ludwig, who acknowledged that he "relies heavily" on Mr. Apgar for advice on mutual funds and a range of other issues.

And though he is not well known to most bankers, Mr. Apgar is considered a heavy-hitter at the OCC. "He's well-placed, highly influential, and seems to have Ludwig's ear," said an industry lawyer, who requested anonymity.

Mr. Apgar is certainly no stranger to the tug and pull of Washington.

He came to Capitol Hill in 1985 as a staff economist for Sen. Bill Bradley, D-N.J. By that time, Mr. Apgar had racked up a bachelor's degree in literature from Harvard, a master's in physics and philosophy from Oxford, and a doctorate in public policy from the Rand Graduate Institute.

After four years with Sen. Bradley, he went to New York as an investment banker at Lehman Brothers, where he worked on bank mergers and stock offerings.

He is reticent about the details of his work at Lehman Brothers, but says: "It was real good preparation for this kind of job, because increasingly, I think, regulatory agencies need to understand how markets work."

The lure of public policy drew him back to Washington in May 1993. He had met Mr. Ludwig during his stint with Sen. Bradley, and sought out the policy-adviser job at the urging of friends.

Mr. Apgar says he didn't mind taking a "huge pay cut" to accept the OCC job. Indeed, he jokes that he and his wife, an art dealer, are rare birds: they moved from New York to Washington and managed to end up in a smaller apartment. But he says the experience is well worth it.

"I think it is crucial for people to work in both sectors," he said, so that those in government understand the business world and vice versa.

He outlined his views during an interview in his office, which is sparsely decorated with photos from journeys to India and the Far East.

The key issue for banks, he said, is how they "restructure themselves to compete against their most fierce competitors, which will include nonbanks."

For example, the deposit network at banks "competes more and more closely with mutual fund companies," he says, and "banks have to be as competitive as the most effective players in that particular line of business."

The Long Haul

And even though banks are not making much money at the mutual fund business right now, Mr. Apgar said the OCC believes they are in it for the long haul.

But some in the industry believe the OCC is hobbling banks in the competition with securities firms by focusing too heavily on consumer protection.

"It's a very fine line to walk," said an industry consultant who feels that way. "How do you get proper disclosure without ... destroying the capacity of banks to compete with securities firms?"

Meanwhile, Mr. Apgar is winning the respect of some consumer advocates, who have voiced concern that bank customers could mistake uninsured mutual funds for insured deposits.

"I find he's very straightforward and very sincere about responding to consumer concerns," said Kent Brunette, a lobbyist for the American Association of Retired Persons.

For instance, Mr. Brunette said he had met with the Comptroller and Mr. Apgar to urge that they send anonymous shoppers to see what bankers are telling customers when they sell them mutual funds.

The agency has since urged other bank regulators and the SEC to join it in a coordinated program of testing. Mr. Apgar responds that the OCC has "tried to be surgical in addressing areas of customer confusion."

"We want to nurture all the competitive advantages of banks, except the susceptibility of customers to confusion," he said.

In fact, he thinks banks have the potential to do much good by teaching customers the differences between savings and investments.

If banks do their job well, he said, customers may come to understand investment products "better than they would without bank involvement."

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