and heavier enforcement to curtail so-called predatory lending, federal and state regulators said Tuesday.

Targeted practices include frequent refinancings at high rates, excessive fees, or ignoring a customer's ability to repay. For example, these practices would be barred under a North Carolina law that takes effect next summer and a proposed rule in New York.

At a fair-lending conference sponsored by the Consumer Bankers Association, Kenneth Markison, an assistant general counsel of the Department of Housing and Urban Development, said current federal law is not strong enough to stop kickbacks to loan brokers or bar unreasonable fees, such as heavy prepayment penalties.

But bankers said additional laws and regulations could deter them from extending loans to people with poor or no credit histories.

"There are laws to deal with the bad actors," said Robin Warren, associate general counsel of Bank of America Corp. in Charlotte, N.C. "What I fear is these truly heartrending situations will lead to bad laws."

But Edward F. Holley, a deputy superintendent of New York's banking department, said lenders that follow the rules will not run into trouble. "I welcome more financial institutions, including banks, to enter subprime lending," Mr. Holley said. "But to say that we'd ignore the problem, we'd be remiss."

Separately, a senior regulator at the Office of the Comptroller of the Currency told the conference that subprime lending's high yields may be attracting banks that are not prepared.

"I see subprime lending as sort of walking a tightrope," said David D. Gibbons, deputy comptroller for credit risk. "No matter what side you fall on, safety and soundness or (fair-lending) compliance, it will cause you great damage."

Many banks have been unintentionally sliding into subprime lending as they lose better-qualified customers to lenders with lower interest rates, Mr. Gibbons said. That can expose a bank to allegations of fair-lending violations, he added.

"Banks must ensure that price is based on risk only," Mr. Gibbons said. "Let's face it, a lot of subprime loans go to minorities."

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