SAN FRANCISCO - In what could be one of the largest settlements brokered by a regulatory agency, the credit card issuer Providian Financial Corp. is expected to pay up to $300 million to settle claims related to an investigation by the Office of the Comptroller of the Currency and the San Francisco district attorney into allegedly unfair business practices.

Such a sum, which is still under negotiation, would be far more than previously expected and would act as a stern rebuke to financial institutions that have been under attack by regulators for what they say is "predatory" behavior.

Providian declined to confirm the settlement figure, which was reported by the San Francisco Chronicle on Tuesday. The company said Monday that it had agreed to pay $1.6 million to the Connecticut Attorney General's Office to settle allegations about its business practices in that state.

On Tuesday, Providian revised estimates for second quarter and yearend 2000 earnings to account for the impact of a potential settlement with California and the OCC, the impact of the agreement in Connecticut, and a one-time gain from the sale last week of $1.5 billion in home equity loans. The company has more than $26 billion of assets under management.

Providian said it expects earnings, excluding the settlement costs, to be in the range of $5.10 to $5.20 for the year; analysts had forecast earnings per share of $5.20. Kenneth A. Posner, an analyst at Morgan Stanley Dean Witter & Co., said that he originally expected any settlement to be around $50 million. Having seen Tuesday's release, he said he now expects that total to be around $150 million, or $270 million, before tax.

Customers have charged that Providian engaged in a range of unethical practices, particularly on the part its Platinum card business. In May 1999, the San Francisco district attorney's office started investigating consumer complaints that Providian assigned late fees unfairly and charged for services that had not been requested. The OCC later joined the talks.

Providian should have a good idea of the agency's thinking on these matters, because two former OCC officials - Konrad Alt and Christopher Lewis - now have senior positions at Providian. Mr. Alt is a senior vice president and head of the company's public policy group and Mr. Lewis heads up government relations. A spokesman for Providian, however, said that both are precluded from talking with the OCC directly because of the agency's ethics clause.

In the statement Tuesday, Providian was vague about the nonmonetary impact of a potential settlement, simply saying it would have to "modify certain business practices." In past interviews, executives from the company said they were making changes to their business, such as extending the grace-period for late fees and establishing a toll-free number for disgruntled customers.

Shares of Providian fell 31.25 cents, to close at $93.40625.

Its unclear how, if at all, the Providian settlement might affect lawsuits pending against First USA Inc., the Wilmington, Del., card unit of Chicago's Bank One Corp. A spokesman said Bank One does not comment on pending litigation. Late last month a federal judge in Dallas dismissed a class action filed by customers against First USA. The Texas judge said the case should be handled in arbitration.

Barbara A. Rehm contributed to this story.

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