WASHINGTON -- The American Bankers Association plans to charter a new affiliate that will represent industry concerns on derivatives, bank proprietary mutual funds, and other securities issues important to the industry.

The affiliate, tentatively named the American Bankers Securities Association, would amount to a separate trade group housed within the ABA.

It would have its own staff plus outside legal representation, but would be backed up by ABA resources, particularly in the area of government affairs. The parent association would handle lobbying efforts.

Initially, it would focus on wholesale securities issues, such as the underwriting activities banks undertake in Section 20 subsidiaries. As a result, it would probably only be of interest to regional and money center banks.

Later, it could get into retail issues, such as brokerage activities, said Edward L. Yingling, the head of the ABA's government relations staff.

"Ultimately thousands of banks could become members, depending on what happens at the retail level," he said.

Mr. Yingling said the new affiliate would handle issues now addressed elsewhere within the trade group, and would give member banks an alternative to organizations sponsored by other industries.

"If you're a bank proprietary mutual fund, you probably belong to the Investment Company Institute," he said. "If you're a Section 20, you probably belong to the Securities Industry Association.

"But bankers are saying there is a potential conflict of interest coming up and there are issues of importance that those trade groups don't handle," he added.

In the next Congress, lawmakers could consider whether to expand bank securities powers. Banks and securities finns would likely have very different and perhaps conflicting objectives.

In addition, banks often have specific areas of concern that aren't addressed by other trade groups. One example Mr. Yingling cited was an amendment considered last year that would permit banks to convert common trust funds into mutual funds without unfavorable tax consequences.

Still, Mr. Yingling said he doesn't believe banks will abandon their memberships in other trade groups because of the new ABA affiliate.

"We won't be focusing on securities issues broadly," he said. "We'll be concentrating on issues important to banks."

The ABA will be forming a committee of interested banks to get the new affiliate started, Mr. Yingling said.

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