WASHINGTON -- The effort to consolidate the bank regulatory agencies may be much simpler either the Clinton adminisor Congress thought.

The Federal Financial Institutions Examination Council is volunteering to become a scaleddown version of the superregulator that President Clinton envisioned.

But unlike the President's proposal, the exam council's suggestion would not eliminate any agency. Instead, it would unify the five independent agencies under the auspices of the council.

The exam council is ideally suited for the job because it already serves as an umbrella group for the five regulators. All Congress needs to do is give it the power to write regulations and force the other agencies to go along, said Joe Cleaver, the council's executive secretary.

"In my judgment, it would be a more efficient way to harmonize uniform policymaking rather than just starting from scratch and dealing with all the nightmares that go with it," said Mr. Cleaver, a former Federal Reserve staffer who has been at the council for nearly three years.

Robert J. Lawrence, the council's executive director from 1979 to 1991, first proposed boosting its power in 1992 in a 15-page report to Fed Governor John P. LaWare, who at the time was the council's chairman.

Mr. Lawrence proposed operating the exam council much as the military runs the Joint Chiefs of Staff. The President would appoint a chairman, who would outrank all other members of the council. That person would run the agency, making decisions with the advice of the other members. The top person at each agency, just like the top military officer in each service, would sit on the council.

The new exam council would write regulations, although each agency would retain its examination powers. The council also would coordinate training and provide a central authority for examinations.

Mr. Cleaver said the problem with the current setup is that every decision the exam council makes must be sent to each agency for public comment and approval. This can delay rules for months or years, he said. For example, the council and the agencies have battied for four years over new rules for recourse arrangements.

Mr. Lawrence also proposes giving the council a permanent staff to work on rule-making issues. This would solve the problem of interagency staff rivalries because the staff working on regulations would owe its loyalty to the exam council, he said. So, they would become less susceptible to pressure from the regulating agencies. He said in his proposal that the change would increase efficiency, without requiring agency restructuring.

The proposal has some support. Both Andrew C. Hove Jr., acting chairman of the Federal Deposit Insurance Corp., and Konrad S. Alt, chief of staff at the Comptroller of the Currency's office, said the idea has merit. "It is an interesting question and it deserves attention," Mr. Alt said. Mr. All said the proposal has not been part of the administration's bank consolidation plans, which would merge most regulatory powers into a new Federal Banking Commission, with the Fed retaining limited rights over some institutions.

"Possibly it is workable," he said. But he noted regulators always have been wary of giving the council too much power. Mr. Hove, who said he had not previously heard of the proposal, said the concept appeared "free." Mr. Hove, the current exam council chairman, said the proposal would build upon the body's strongest traits because it would strengthen coordination while retaining the competition among agencies.

This is preferable to other bank consolidation plans, he said. Mr. LaWare, who served as council chairman for two years, did not return a call seeking comment. Mr. Lawrence said he believes the proposal could pass Congress because it achieves the administration's goal without destroying an agency, a prospect that always causes political trouble. "I think with this type of plan, you get most of the benefits of consolidation without having to go through the political fire," he said.

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