WASHINGTON -- The days of no-brainer mutual thrift IPOs are over.

Starting this month, stock prices have fallen in almost every deal brought to market. Just this week, New York City's Carver Federal Savings Bank posted one of the most spectacular losses so far- down 25% after three days of trading.

Such losses were unheard of over the past two years in the redhot market for mutual thrifts selling stock for the first time. But this month's record shows that investors can no longer count on windfalls from stock price gains of an average of 30% in the first days of trading.

Douglas P. Faucette, a partner in the Washington-based law firm Muldoon, Murphy & Faucette, said "No longer will the bulls roam where seldom was heard a discouraging word."

Orin S. Kramer, general partner in Boston Provident Partners, said the trend has broad consequences. "Large numbers of converted institutions end up being acquired themselves," said Mr. Kramer, who runs a New Jersey based hedge fund that specializes in financial institutions. "Therefore, to the extent that you slow down the conversion process, you slow down the consolidation of the banking system."

The smart money -- which once rushed to place deposits in mutual thrifts across the country in the hopes that they would someday sell stock -- has abandoned the conversion deals, leaving mostly mom-and-pop investors to shoulder any losses.

The deals won notoriety because thrift managers pocketed much of the proceeds in the spurt of deals over the past few years. Congress held hearings and regulators rewrote the rules to eliminate much of the insider windfalls.

At the same time Congress cracked down, the deals won accolades from Wall Street gurus like Peter Lynch, who urged small investors to pour money into the investments because they were such sure shots.

The boom went bust as several factors collided to push stock prices down.

Thrift stocks across the board cooled off as interest rates rose. At the same time, regulators forced companies to push up their appraisal values and tinkered with the conversion rules in an effort to weed out management windfalls.

Now that stock prices are dropping, Wall Street is blaming regulators who forced thrift appraisal prices higher for the reversal of the trend.

"A couple of years ago, the appraisals were at 50% of book value;' but investors knew thrifts were often worth more because of unrealized gains in their securities portfolios, said Nick Adams, portfolio manager of the First Financial Fund, a closedend mutual fund that invests in small banks and thrifts.

"Now the appraisals are coming in at 75% to 80% of book value," but the companies are really worth less than that because those gains have become unrealized losses, he said.

To be sure, there are likely to be some good deals in the future. Investors will still place money on solid companies with growth potential. But investors looking for a quick 30% return on their money will stay away, which cools the market for the rest of those who buy stock.

Washington thrift lawyer Eric Luse, a partner at Luse, Lehman Gorman, Pomerenk & Schick, said, "It is the little guy who has faith in the community bank who gets left holding the bag."

Philip C. Colaco, senior research analyst at SNL Securities, said, there have been 14 deals this month. Data from the Charlottesville, Va.-based bank research and publishing firm shows that 11 are now trading below their offering price. Mr. Colaco said Carver Federal's offering has been hit the hardest, but the rest of the deals are down 2% to 6%.

The biggest wild card is yet to come. Flushing Savings Bank, a Flushing, N.Y., thrift with $616 million in assets, is standing by to sell stock near the end of the month. It plans to raise $65 million as it converts from mutual ownership to stockholder ownership. If it follows the current trend, it is like ly to trade down, perhaps pulling investor demand down further.

Mr. Colaco is a long-term optimist. He believes these thrifts, stock prices will go up eventnally. However, Mr. Adams said "People thought you never con lose money in these things... The fact of the matter is, you can."

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