Bankers in New York State are on a legislative roll.

In January, a bill deregulating prices on consumer bank products was signed into law. In March, state-chartered banks won a lawsuit allowing them to offer annuities.

"There is an upbeat feeling," said Michael P. Smith, executive vice president of the New York Bankers Association.

The association kicked off its annual convention yesterday in Saratoga where 170 bankers are expected to gather.

In an interview, Mr. Smith talked about the New York banking industry's push for more powers and its impact on community banks.

Q.: What was the biggest victory for community banks this year?

SMITH: It would be twofold. One was this consumer credit deregulation bill that basically regulated every form of consumer credit and allowed greater flexibility on fee setting. The second piece would be the annuities case. All of our banks need to have this flexibility. That is a very important new product.

Q.: So, things are coming together for banks in the state?

SMITH: There is a very positive momentum in the industry. There seems to be a sense of revitalization in the industry and in modernizing the laws.

Q.: What else is on your radar?

SMITH: There has been a movement toward tax reduction. What we are going to do now is target greater reductions in 1995. They [state legislators] have already agreed on the budget that has tax reduction in it for the first time since 1985. We hope this will be a trend line.

Q.: What's your next battle?

SMITH: We are going to ask the legislature very shortly to allow state-charted banks to sell insurance in towns and villages of 5,000. That is going to be a '95 item. We believe strongly that banks of all sizes should be able to sell insurance without restrictions.

Q.: What are your chances?

SMITH: There is intense opposition. When any legislation allowing banks to sell insurance [is proposed], it gathers opposition quickly. We are just going to keep on pushing.

Q.: Will community banks sell insurance?

SMITH: Yes. We run a credit insurance program today. If the universe was 120 community banks, about 70 community banks are in those programs, which shows there is a ral interest in insurance.

Q.: Where do you stand on national interstate banking?

SMITH: We support that. New York passed one of the first interstate banking laws in 1982.

Q.: Did small banks give you grief for supporting the bill?

SMITH: In the early '70s it was a contentious issue. But the small banks realized they could compete. New York is a good laboratory.

Q.: Are community banks at odds with big banks on legislative issues?

SMITH: We've been very fortunate in New York. We are going to advocate that the industry make as a top priority political unit across the country.

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