WASHINGTON - Lending in most of the country picked up slightly this summer, according. to a Federal, Reserve report released on Wednesday. But while consumer lending and mortgage financing improved in many regions, the report said business lending remained "generally flat."

The survey, which relies on anecdotal evidence from the Fed's 12 districts, comes just two weeks after another Fed report of strengthening lending activity.

That report found a continued easing of lending terms and standards, as well as an increase in demand for bank credit by households and businesses.

|Slow to Moderate' Growth

The Fed's report, called the Beige Book, is compiled several times a year in anticipation of Federal Open Market Committee meetings. The group meets next on Sept. 21 to set monetary policy.

The economy grew at a "slow to moderate" pace in late July and August, Wednasday's report said. The midsection of the country continues to show stronger activity, while the two coasts continue to lag.

Wednesday's report is the sixth this year that has reported modest, weak, or slow economic growth.

Crunch Over?

The growing evidence of a slight pickup in lending activity has led some economists to declare the credit crunch over.

"People who have decent balance sheets can come in and get a loan." said Alfred Smith, an economist with NationsBank.

"And banks are becoming more aware of the fact that they need to have loans outstanding to better their profits."

But others are less sanguine, saying that as long as the economy remains weak, the credit crunch will linger.

"There is going to be moderate economic growth in the next year and very moderate lending growth comensurate with that," said James Chessen, chief economist for the American Bankers Association.

Highlights of the Fed's report, by region, follow:

* Boston: Marginal economic expansion and scattered improvements in commercial construction. Investment companies report strong sales, especially, in tax-free bond and equity funds.

* New York: Mixed economic growth, with small and midsize banks reporting no change in their willingness to lend.

Overall loan demand was stable, but business loan demand "showed continued signs of sluggishness."

* Philadelphia: Steady economic activity, with lending "edging up," and weaknesses in commercial loan demand being offset by increased consumer lending. Most bankers expect no near-term increase in business loan demand.

* Cleveland: Loan demand rose moderately, mostly from mortgage refinancing. Business lending has been "slow or shrinking," and deposits have fallen further at some banks.

* Richmond: Sluggish growth overall, with a slight increase in loan demand, as well as residential and commercial real estate activity.

* Atlanta: Economic growth slowed. Consumer loan demand increased slightly, while business lending remained flat. Loans for car purchases have been the source of most of the new consumer lending.

* Chicago: Slow economic expansion, with strengthening business and consumer lending. Competition has reduced the cost of credit lines and the spread of loan rates over base rates.

* St. Louis: Slow growth, with flood damage now at $2 billion to $3 billion. Lending activity increased, though more slowly than earlier this year.

* Minneapolis: Moderate economic growth, with construction leading the economy. Consumer spending was mixed and price levels were stable.

* Kansas City: Retail sales were up, and housing activity increased. Overall loan demand stayed flat or increased slightly, but demand for business loans was unchanged.

* Dallas: Moderate expansion, with a pickup in sales and employment. Loan demand improved and is now above last year's level. Bankers are optimistic about future loan demand.

* San Francisco: Economic activity was mixed. In California. banking conditions showed some signs of improvement, with the decline in loan volume slowing and some measures of asset quality improving.

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