International Business Machines Corp. and at least 10 banks are in the early stages of forming a new company to compete against Microsoft Corp. and Intuit Inc. in the home banking market.

The participating banks would include the five owners of Meca Software Inc., whose PC-based personal finance software package, Managing Your Money, would lie at the heart of the new company's services.

Observers said the venture - a free-standing company that will issue stock - is several weeks away from its official launch, but word of its formation spread quickly after NationsBank Corp. chairman Hugh McColl offered some preliminary details in an interview with The Washington Post.

NationsBank and BankAmerica Corp. jointly purchased Fairfield, Conn.- based Meca last May. They were joined as owners this year by Fleet Financial Group, First Bank System Inc., and Royal Bank of Canada. Other participants in the new venture include Barnett Banks Inc., KeyCorp, and Banc One Corp.

The new company, whose formation is to be underwritten by Montgomery Securities in Los Angeles, is viewed as a forceful industry response to the encroachment of nonbanks into the home banking arena.

"This will be a very, very comprehensive network-oriented home banking and electronic commerce system," said a source close to the talks, who did not want his name used.

"The idea is that the banks will be able to create their own branded set of services for their customers, so that what they see when they log on is the bank, not Microsoft or IBM or anyone else."

Though bankers involved in the venture were reluctant to provide details, several said IBM is playing the lead role in the consortium. Its chairman, Louis V. Gerstner Jr., has personally solicited some of the involved banks.

The new company will have its work cut out for it. Today, Intuit, is the home banking software leader. Its personal finance software product, Quicken, has nine million retail customers and a market share that hovers around 80%. By contrast, only about 600,000 customers use Meca's Managing Your Money software.

However, the banks that own Meca have banking relationships with 40 million households, and Meca is now soliciting new owners.

These prospective owners, plus the other participants in the new venture, could narrow the market share gap quickly if the new PC banking services are sold effectively.

"The purchase of Meca was just one step in the banks fighting back. Partnering with IBM is another step," said Adam Schoenfeld, analyst with Jupiter Communications Co., New York.

"IBM likes nothing better than to tweak Microsoft."

Mr. Schoenfeld said the competition between the new company and existing ones will amount to "a marketing battle" in which home banking software providers vie to supply banks and customers.

Matthew Cone, spokesman for Microsoft, said he viewed the emergence of the new company as "a positive" and not as a direct challenge to Microsoft's home banking product, which is called Money.

"The strategy we have going forward encourages many players to provide middleware and back-end solutions," he said.

"I'm quite confident that it will encourage many more banks to get on board, and we'll have many more banks supporting the Microsoft Money product as well."

Mr. Cone disputed Mr. McColl's assertion that Microsoft was seeking to wrest control of bank customers and network operations. "That may be a reaction to perceived strategies of the past," Mr. Cone said.

Mr. McColl had hinted at the development of the consortium before the Washington Post article.

In an keynote address at the Bank Administration Institute's Retail Delivery Systems conference in Atlanta last December, he said, "I can envision a partnership of banks with a strong technology partner building its own channel, its own financial-service highway."

But officials at other banks in the consortium said yesterday that Mr. McColl had jumped the gun.

Several bankers involved said that until the ink dried on the deal, legal restrictions prevented them from offering any details.

"Why don't you call Hugh? He seems to be the one who wants to do the talking here," said William Murschel, spokesman for KeyCorp, in response to a request for details on the venture.

Banc One spokesman John Russell said Mr. McColl's comments were "premature" because the deal was still "fluid."

"No contracts have been signed with anybody to do anything," Mr. Russell said. "There's a level of understanding that needs to get in place before the lawyers start doing their work."

Lynn Drury, NationsBank spokeswoman, downplayed the significance of Mr. McColl's remarks to the Post and said he was not available to elaborate on them.

Paul D. Harrison, president of Meca Software, said IBM and the banks had been taking the lead on the new venture.

"Our ownership is involved in many endeavors," he said, adding that Meca is a "stand-alone company" that will remain separate from the new venture.

"To the extent that a group of banks is being proactive and taking the initiative to make sure that they control this part of the home banking solution, we applaud their efforts and intend to work very closely with them," Mr. Harrison said.

But the banks in the consortium are not the only ones contending to make their names in the home banking arena. Citibank has been promoting its own home banking products heavily, and its competitor, Chase Manhattan Corp., has been working to keep pace.

"It looks like a war is escalating, and it's so early in the game that no one is really a clear winner in this," said Gary Arlen, an electronic banking consultant in Bethesda, Md.

Mr. Arlen said the new bank consortium was large enough to exert major influence on the home banking market.

"These banks have a way to make a market by just shoving Meca software into customers hands and saying, 'Here's a way of doing home banking with us," Mr. Arlen said.

"That would mean weaning some customers off of Quicken, but it would be a way of interesting new customers, too."

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