COMPLIANCE:

IN TWO DOCUMENTS being circulated quietly, the Federal Reserve and the Office of the Comptroller of the Currency are soliciting ideas on the best way to enforce some of the most controversial aspects of Community Reinvestment Act rules adopted in April. Konrad Alt, chief of staff at the OCC, says wide-ranging comments should help in formulating efficient exam procedures. Page 9

WASHINGTON:

CONGRESS MAY EXEMPT banks with small student loan portfolios from costly audits currently required by law. Rep. Thomas Ewing, R-Ill., and Rep. Ron Lewis, R-Kan., introduced a bill to drop the audit requirement for student loan portfolios of $5 million or less. Page 2

THEY GET LOTS of calls from bankers who say they wish they could do the same, but Oklahoma's two deposit-insurance dropouts appear destined to remain curiosities, not trend setters. Page 3

REGIONAL BANKING:

CONSOLIDATION in the corporate trust sector heated up again as Philadelphia-based CoreStates Financial Corp. sold two units to Mellon Bank Corp. and Bank of New York Co. Page 4

UNION BANK has made a half-million-dollar investment in Family Savings Bank, a federally chartered thrift said to be the largest owned by blacks in California. It will use the investment to boost its capital and to fund mortgages in low- and moderate-income Southern California neighborhoods. Page 5

COMMUNITY BANKING:

WHEN NEW YORK's Hudson Valley Bank fishes for deposits, president John Pratt Jr. doesn't advertise. Instead he turns to an assortment of 85 lifelong Westchester County residents, members of an unusual business development board, to reel them in. Page 6

MORTGAGES:

GIANT GE CAPITAL Mortgage Corp. says it will no longer make home loans directly to the public. The retail channel had never been a big source of loans, and the company decided to wind down the business over the next few months. Page 10

MIXSTAR has started a new service that allows lenders to shop for loans on-line. LoanVault stores loan applications taken by mortgage brokers. Lenders, who pay for access to MixStar, can browse through the applications and choose which they would like to fund. Page 10

INVESTMENT PRODUCTS:

EXPANDING in key wealth centers, Chemical has targeted two additional cities - Naples, Fla. and Greenwich, Conn. - for private banking offices. Page 12

CALVERT GROUP, a small Maryland mutual fund firm, has reorganized its sales staff along distribution channels - and banks aren't included. The company, which manages $4.1 billion of assets, doesn't think it's worth fighting behemoths like Putnam Investments and Franklin Resources. Page 13

FINANCE:

WITH MERGER MANIA at full roar, a rumor that East could soon meet West with a pairing of NationsBank and BankAmerica is getting a respectful hearing in the marketplace. "Implicit in both companies' names is ambition for full national banking," an analyst noted. Back page

TECHNOLOGY:

THE NEW YORK Clearing House Association is further purging settlement risk from its electronic funds transfer system by introducing a minimum collateral requirement of $10 million for individual banks and mandating a 20% reduction in net debit limits. Page 17

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