Banks preparing for the year-2000 changeover face three regulatory deadlines today.

Under the federal government's timeline, this is the date by which banks, thrifts, and credit unions must have finished testing their updated computer systems.

Tested hardware and software should also be "substantially" up and running today. Banks should now be using the same systems they will be using Jan. 1.

Today is also the deadline for banks to complete and test their contingency plans, which will be used in case of a year-2000 failure inside or outside the institution. Contingencies might include computer crashes, security lapses, and supplier hiccups.

Though it is impossible to say how many institutions met all three deadlines, regulators say the vast majority were on track.

"The bottom line is, the banking industry is going to be ready for Y2K," said Ellen Seidman, director of the Office of Thrift Supervision. "They'rein good shape, and they're getting better every day."

Banks' year-2000 ratings continue to improve.

As of May 31, 98.3% of the nation's 10,359 insured banks and thrifts were judged "satisfactory" in year-2000 preparations, compared with 96.8% two months earlier.

Only 151 institutions, or 1.5%, were rated "needs improvement," compared with 313 on March 31. The number rated "unsatisfactory" fell to 21, from 24.

Moreover, none of the institutions on the Federal Deposit Insurance Corp.'s failed-bank projection list is expected to fail solely because of year-2000 problems.

Banks have a number of incentives to comply with the government's year- 2000 timetable.

Those that score less than "satisfactory" may be issued safety-and- soundness or cease-and-desist orders. The latter is a public document and could cause embarrassment and lost business.

Regulators also may downgrade an underperforming bank's Camels rating, including both the management component and the composite rating.

And under a new FDIC rule, banks and thrifts that remain less than "satisfactory" as of July 31 will be required to make backup copies of customer account data. Such copies would be crucial if an institution suffered a catastrophic data crash, was taken over by regulators, or had to switch data processors at the last minute.

For the time being, at least, media interest in banks' preparations for the calendar event may be waning.

On Tuesday, the Federal Reserve Bank of Chicago and the Illinois Bankers Association had to cancel a press conference on the subject because only one reporter had signed up.

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