WASHINGTON - With the House and Senate banking committees scheduled to vote on major legislation this week, bank lobbyists were scrambling to prevent creation of a "super bank charter" for the nation's thrifts.

"We want to be sure that they don't say to the thrifts, 'You can have all the powers banks have and then some,'" said Edward L. Yingling, chief lobbyist for the American Bankers Association.

Mr. Yingling and others are concerned that the two panels will amend a must-pass budget bill to merge the bank and thrift insurance funds and set the stage for a merger of the two industry charters as well.

Bankers want to be certain that existing thrift powers are not preserved forever, or "grandfathered," should the banking committees decide to merge the bank and thrift charters.

Two specific grandfathering issues are troubling bank industry representatives.

The first involves unitary thrift holding companies, which have broad authority to underwrite securities and insurance, and to affiliate with nonfinancial companies.

Second, all thrifts can engage in some activities denied to banks, including broad interstate branching and at least some insurance and real estate investment.

"We understand that there has to be a transition period, but we don't want to see a permanent grandfathering of what would be a bank with superior powers," said Mr. Yingling.

However, thrift industry representatives argued that the bills under consideration may not go far enough in protecting nonfinancial companies that have invested in the savings and loan industry.

"Grandfathering simply doesn't work," said Patrick Forte, president of the Association of Financial Services Holding Cos.

Mr. Forte objected in particular to a provision in the House committee bill, drafted by chairman Jim Leach, R-Iowa, that would turn authority for supervising thrift holding companies over to the Federal Reserve Board.

The Fed, he said, opposed ownership of banks by nonfinancial companies. Without adequate protection, he added, the grandfathered holding companies may face a hostile regulatory environment when the merger of charters places them under the jurisdiction of the Federal Reserve.

Thrift lobbyists also expressed concern Monday over Rep. Leach's "fresh- start" approach to the bad debt reserve, which would repeal the deduction without forcing institutions to pay back taxes on the 42-year-old exemption.

The current provision is ambiguous, they argued. "Our worst nightmare is the whole process costing our guys an additional year's earnings," said Randall McFarlane, chief lobbyist for America's Community Bankers.

In a memo last week, Rep. Leach said his main concern was assuring a level playing field for the financial services industry "with as few disruptions as possible," the Iowa Republican warned.

"Members should be cautious in making commitments to one or another institution or group if the vast majority of others are competitively disadvantaged."

In the Senate, banking committee member Bill Frist, R-Tenn., is expected to propose merging the two industries' charters when the panel meets Wednesday, and some industry observers say support is growing for his approach.

"A major piece of banking legislation could be buried in a budget bill," said Bert Ely, president of Ely & Co.

Kenneth A. Guenther, head of the Independent Bankers Association of America, warned that banks will have little influence over the process once the bills clear the two banking committees and go back to the budget committees, where they will be merged into one large spending and revenue package.

"Budget won't give the time of day to banking lobbyists," he said.

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