Banks are expected to tap the capital markets in coming weeks as the cost of raising capital declines.

Market experts predicted that a strong earnings quarter, fairly low interest rates, and a continuing need to fund commercial loan growth would prompt banks to come to market in significant numbers.

"Banks are already circling the market asking, 'When do you think we should issue?'" said a market professional who asked not to be identified.

Indeed, PNC Bank Corp., Pittsburgh, issued $350 million of 10-year notes Wednesday, and GreenPoint Bank, a subsidiary of New York thrift GreenPoint Financial Corp., is expected to come to market with a $200 million issue of five-year notes this week.

But bank bond market experts said this activity is likely just the beginning of a summer surge.

Bank bond analyst Van B. Hesser of Goldman, Sachs & Co., New York, noted that a rise in commercial loan growth coupled with a favorable interest rate environment could bring about a substantial amount of issuance in July.

A number of banks will look to issue this month because many people vacation in August, volume is lower, and executing deals is more difficult in late summer, Mr. Hesser said.

Issuers are not in the market right now because the industry is in the midst of the customary quiet period that surrounds quarterly earnings announcements.

Mr. Hesser added that banks may also come to market more quickly because an "uneasiness" continues to pervade it.

"We are in a fairly comfortable environment in terms of interest rates, but no one is all that comfortable," Mr. Hesser said. "Things can change very easily. The market this year has been very choppy."

Frequent issuers that are likely to issue again in coming weeks include Chase Manhattan Corp. and Citicorp, both in New York; BankAmerica Corp., San Francisco; NationsBank Corp., Charlotte, N.C.; and Norwest Corp., Minneapolis.

A number of smaller banking and consumer finance companies are also expected to issue soon.

Analysts said that they expect much of the issuance to fall in the short-term and intermediate categories, which include five-year, seven-year and 10-year issues.

Joseph J. Labriola, head of corporate bond research at PaineWebber Inc., pointed out that this is an inexpensive time for a bank to issue.

"Funding costs have gone done immeasurably," Mr. Labriola said. "The swap market is more favorable, and when you put that together with second- quarter earnings, without exception it is a good environment for banks to issue."

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