Firing the latest salvo in the home banking war, Citicorp has slapped a patent infringement suit on the maker of a souped-up telephone that poses a big threat to the banking giant in this growing market.

The suit, filed last week, takes aim at McLean, Va.-based Online Resources and Communications Corp., which manufactures a device called ScreenPhone.

The product -- sold to consumers through NationsBank Corp. -- allows customers to conduct simple banking functions from home. It combines a telephone with a small computer screen and keypad.

New York-based Citicorp, which offers its own home banking device, contends that the Online Resources product makes use of technology covered by three of the bank's patents. Citicorp is seeking damages and a halt to the alleged infringements.

Online Resources swiftly answered the suit's contentions, saying that the nation's biggest bank was simply trying to eliminate the competition.

"This suit against us is harassment, pure and simple," Matthew P. Lawlor, the vendor's chief executive officer, said in his company's response. "Citibank may be mounting nothing more than a veiled attack on banks that compete with it for the home banking customer."

The controversy comes as competition is mounting in the home banking arena. The price of the technology has come down and consumers' comfort level has risen, encouraging a wide range of banks and nonbank players to enter.

Robert Griendling, a spokesman for Online Resources, said officials at his company "find it curious" that Citicorp filed the lawsuit now, rather than two-and-a-half years ago when ScreenPhone first hit the market.

This complaint, he noted, comes only two months after Citicorp introduced its own home banking product in Washington, D.C., one of Online Resources' strongest markets.

Citicorp's program, called Direct Access Banking, gives customers access to home banking services via personal computers and card-activated, screenequipped phones developed by Citicorp and Philips Home Services, Inc., Burlington, Mass.

The bank has been aggressively marketing its service in the Washington metropolitan market. In the process, the bank is competing with Online Resources, which is heavily marketing its home banking service through NationsBank in the Washington-Baltimore area.

"Instead of competing head-to-head in the marketplace, Citibank initiated this surprise legal action," Mr. Lawlor said.

Mark Frieser, a senior analyst at Jupiter Communications Co., a New York-based market research firm, echoed that view.

"Citibank sees [the ScreenPhone] as the only real threat to it in the banking market, because it's less expensive and easy to use," he said.

Online Resources sells its ScreenPhone for $99, while Citicorp aims to price its Philips phone at about $200.

Citicorp officials did not hint at any plans to file similar complaints against other manufacturers of screen-equipped phones.

Susan Weeks, a spokeswoman at the bank, said Citicorp was targeting Online Resources because the screen phone maker intends to enforce its own patent by charging a royalty or licensing fee to anyone who wants to use its technology.

Two of the Citicorp patents at issue cover systems for off-hook telephone sensing and a user interface consisting of remote programmable memory and a front end that includes a phone keypad and display. The patents were issued in July and March of this year, respectively. These functions are not used in Online Resources' product, officials at that company contend.

The third bank patent in contention, originally issued in 1979 and reissued in 1981, is directed at automated teller machines. Online Resources officials say this does not apply to its screen phone.

"We recognize that nuisance patent actions are part of the technology business," said Mr. Lawlor. "We can deal with Citibank because we're on solid ground."

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