WASHINGTON

In another indication that regulators are losing faith in uniform capital standards as the way to control risk at banks, officials of the Federal Reserve and the Comptroller's Office endorsed more flexible approaches. Page 4

Paying higher deposit insurance premiums than banks is starting to squeeze thrift profits, America's Community Bankers reported. "Troubling signs" in fourth-quarter performance suggest "that an erosion of earnings capability may have begun," the trade group's research chief says. Page 2

REGIONAL BANKING

An SEC ruling has cleared the way for proxy challenges to proceed against the management of Onbancorp. The move could lead to a sale of the upstate New York. Page 5

Marshall & Ilsley is planning cutbacks, following the lead of Milwaukee competitor Firstar. Midway in a review of branches, M&I has decided to close six and downsize or move nine. No word yet on how many jobs will be cut. Page 6

COMMUNITY BANKING

Financing farm products for export can be stressful. Wisconsin banker Larry Hiller has financed ginseng producers since 1991, but he's still gun- shy. "What would you do if you had a customer pay you $50,000 off of your loans and the check bounced and your product's in Hong Kong?" Page 8

INVESTMENT PRODUCTS

AT LEAST one regulator has expressed surprise that more banks aren't taking advantage of an SEC ruling by touting the long-term performance of mutual funds converted from trust assets. Page 10

CREDIT/DEBIT/ATMs

Some former NationsBank executives have formed a marketing consulting company to help banks sell and develop a variety of retail products, including credit cards. Page 13

MasterCard has replaced the hologram on its credit cards with a new one, to discourage counterfeiters. "They had been able to produce reasonably close facsimiles," said the card association's security chief. Page 13

CREDIT UNIONS John J. McKechnie 3d, promoted to chief lobbyist at the Credit Union National Association in the wake an executive purge, stresses the need to listen to its constituent credit unions and state-level groups. ""We can never forget who we're representing." Sources say his predecessor lost the job by failure to do that. Page 15

California's Western Corporate Federal, the largest corporate credit union, is reportedly working toward making peace with the federal government. Page 14

TECHNOLOGY

The Federal Reserve System has formed a task force to study the implications of rapidly evolving electronic payment technologies. Page 16

Broadway & Seymour reported a big fourth-quarter loss last week, but not as big as expected. Stock of the bank software and systems integrator rose. Page 18

MORTGAGES

Refinancing homeowners swung away from adjustables last year as the rate gap narrowed. Sixty-eight percent of those who refinanced 30-year fixed loans took new loans of the same length, versus 54% in 1994. Page 20

MARKET MONITOR

Wall Street analysts have grown wary of Wall Street stocks. After a blistering start this year, brokerages are expected to cool off. Page 24

Bank stocks rode a roller coaster with the general market Friday. They surged on the latest news of a slowing economy, sagged on apparent second- guessing, and finally got a second wind. Back page

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