some analysts warned that the gain is only a brief pause in a long slide that has dragged the stock down 16% in two months. To these analysts, Monday's gain of $1.375 to $61.75 was hardly enough to offset uncertainty over the bank's business mix. Bankers Trust's top two executives recently resigned, after a year of turmoil in the derivatives unit, prompting concern that the bank will switch to lower-margin businesses. Some dismissed recent speculation that the new chief executive, Frank Newman, may cut Bankers Trust's dividend, and said the current low price offers a buying opportunity. But, among others, Francis X. Suozzo, an analyst at S.G. Warburg & Co. was skeptical. "Last year, Bankers Trust's stock fell 30%, while the group was down only 5%. You could have made a case then that you should buy it," Mr. Suozzo said. That would have been a bad bet, because Bankers Trust's stock rose only 9% this year, while banks as a group gained 50%, Mr. Suozzo said. "A whole slew of strategic and fundamental questions are still overhanging the company," he added. The departure of Brian Walsh, head of the bank's derivatives operations, is a case in point. "You could definitely read into it that it is a signal on their intent in trading-related businesses," said Mr. Suozzo. The bank announced last week that Mr. Walsh quit. Though he acknowledged that the bank has significant capital reserves, Mr. Suozzo said that shifting the business mix might cause significant charges to capital. If the bank exits two or three businesses it thinks are too volatile, it might have to take a charge of hundreds of millions of dollars, he said. Several analysts, including Merrill Lynch's Jim Rosenberg and Mr. Suozzo, said that Mr. Newman might elect to cut the dividend in order to start his new tenure with a "clean slate." A vocal group of analysts disagreed, citing the relatively small impact a dividend cut would have on capital and the possible psychological harm in the market. Arguing that Mr. Newman might elect to cut the dividend in order to ride heard over increases later is "like saying after I punch you in the stomach, I'll administer (first aid) to your wound," said Robert B. Albertson, a bank analyst at Goldman, Sachs & Co.. Lawrence Vitale, a bank analyst at Bear, Stearns & Co., said that the market would not react well to a dividend cut, and that Mr. Newman "doesn't want to preside over a slide in the stock." But even some of Bankers Trust's advocates acknowledged that the prospect of a dividend cut appears to have spooked the market. "It seems to be the majority view that a dividend won't be cut, but that doesn't appear to be reflected in the stock price," said Raphael Soifer, a bank analyst at Brown Brothers Harriman & Co. After a year of bad publicity over the bank's derivatives business, Mr. Soifer said analysts may be wary of further negative headlines. Those who publicly dismiss the idea of a dividend cut may be quietly urging clients to sell, Mr. Soifer suggested. He saw a parallel in political polling. "People tell the pollster one thing, and then vote the other way." In the broader market, the Standard & Poor's bank stock index gained 0.73%, compared with a 0.23% gain in the overall Standard & Poor's index. BankAmerica Corp. and NationsBank Corp. led the rally, gaining $1.375 and $1.25, respectively. Separately, shares of Household International rose sharply on Monday, finishing up $3 to close at $60. William Blair & Co. analyst Joseph F. LaManna initiated coverage with a "buy" rating, setting a 12-month target price of $87. The rating reflects restructuring efforts under chief executive William Aldinger, who joined the company a year ago, said Mr. LaManna. More than 965,000 shares changed hands, compared with an average daily trading volume of 314,300.
