The president of a money-losing New Jersey banking company that is operating under regulatory supervision said he is working to clean up its lending practices and plans to turn a profit next year.

Anthony Feraro, who in June was promoted to president of $409 million-asset Unity Bancorp in Clinton, said he has been addressing the company's problems since he arrived late last year as chief operating officer.

"Things have changed dramatically in the past seven months," he said.

Unity last week disclosed that it had stopped paying its chairman and vice chairman, to help the bottom line. Regulators had merely suggested that their pay be reduced, the company said.

The Federal Deposit Insurance Corp. and the New Jersey Department of Banking in mid-July told the bank to increase its capital levels, stop making risky loans, and identify ways to deal with problem assets.

Most of Unity's problems stem from aggressive expansion in 1999 and rising interest rates, Mr. Feraro said. The company has "already resolved 80%" of the problems and should have "nothing but profits" by early next year, he said.

In the first quarter of this year Unity had a $989,000 loss. Later results were not available. It had a loss of $3.4 million for all of 1999.

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