Washington People: Banks Far from the Spotlight In State of the Union

Strong profits and a sound economy gave President Clinton little reason to mention banking in his annual State of the Union address last week.

The President gave only cursory reference to the industry when he said government programs must help the poor "create jobs through investment by business and loans by banks."

Banks would be helped, however, by President Clinton's plan to expand individual retirement accounts. In his speech, the President said tax-free withdrawals should be allowed for education expenses.

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Jonathan L. Feichter, former acting director of the Office of Thrift Supervision, isn't shy about using his new World Bank post as a bully pulpit.

In a speech Thursday, the bank's new director of financial sector development exhorted U.S. and European bankers to share their skills with colleagues in developing countries.

Only hands-on assistance can foster healthy financial institutions in those markets, he said. "It is hard to encourage strong financial markets in emerging countries, there's no magic," he said.

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Roughly 250 industry representatives from nearly every state hiked up to Capitol Hill last week to lobby against easing limits on credit union membership.

For the Utah Bankers Association, Utah Jazz basketball player Jeff Hornacek embodies their beef.

Why does a highly paid pro athlete belong to a credit union, which is meant for people of lesser economic means? asked Utah Bankers president Lawrence W. Alder.

Scott G. Earl, president of the Utah League of Credit Unions, said credit unions are not confined to serving poor customers. Mr. Hornacek simply has chosen more affordable financial services, Mr. Earl said. "If he qualifies for a field of membership, why can't Jeff Hornacek belong to a credit union?"

Besides, Mr. Earl noted, a bigger Jazz star, Karl Malone, is featured in a bank's ads.

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Vladimir V. Vinogradov, president of the large private Russian bank Inkombank, predicted that 1,000 banks in Russia-or about half the total- will disappear within the next five years. Most of those will go bankrupt, he predicted Friday.

Whether a safety net for depositors will exist is unclear. Russian politicians and the central bank are deadlocked over a proposal to create a deposit insurance fund similar to the U.S. Federal Deposit Insurance Corp., he said.

Mr. Vinogradov added that he has invited a "prominent" American banker to join Inkombank. He hopes to receive an answer by mid-spring.

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The Independent Bankers Association of America has tapped Mary Smolenski as director of on-line services. She will manage Community Bank Exchange, the IBAA's on-line network for bankers. She also will revamp the group's Web page.

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Supporters of the low-income-housing tax credit gathered on Capitol Hill Thursday night to celebrate its 10th anniversary.

Lewis P. Jones, vice chairman of Chase Manhattan's Community Development Corp., and Paul S. Grogan, president of the Local Initiatives Support Corp., were among a group of speakers who touted the credit.

The tax credit is responsible for 900,000 homes and apartments, 90,000 new jobs each year, and $1.5 billion in new tax revenues. It provides federal tax credits for investments in housing developments for low-income people

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