WASHINGTON

Two banking regulators told Congress that a bill allowing banking companies to invest in small businesses could pose a risk for banks and a threat to deposit insurance funds. Page 2

The industry was quick to oppose a plan by the banking agencies to force banks to determine whether a customer understands the risks associated with government securities. Page 3

COMMUNITY BANKING

At the current rate that mutual thrifts are converting to stock ownership, industry observers say the 600 or so remaining mutuals will be gone by 2002. Page 6

To plug a loophole in state branching restrictions, Nebraska is enacting legislation to banish "phantom" savings and loan charters that used by some banks to expand beyond their home communities. Page 7

FINANCE

Joseph P. Bauman left New York and the high-profile chairmanshi p of the International Swaps and Derivatives Association two years ago to slip behind the scenes of Bank of America's derivatives business. Now he's back in the limelight to unveil his new vision for the operation, folding derivatives into a menu of services for corporate customers. Page 22

Banks Trust New York's stock got a boost from surprisingly strong first-quarter earnings and a positive analysts meeting on Wednesday. Back page

MORTGAGES

To survive in a world of thin margins, home lenders must wring more profits from servicing and from sales in the secondary market, according to experts at a mortgage conference in Chicago. Page 8

Norwest Mortgage earned a record $30.4 million in the first quarter, 44% more than a year earlier. The Norwest unit originated $11.7 billion in mortgages in the first quarter. Page 8

INVESTMENT PRODUCTS

Bank-managed mutual funds were outgunned by their nonbank rivals during the first quarter in all six key categories of a recent study. Page 10

Credit Suisse's private bank is now providing institutional-style investment banking to individual clients through a joint venture with subsidiary CS First Boston. Page 11

CREDIT/DEBIT/ATMs

Gensar Holdings has gobbled up a competitor in the merchant processing field, buying POS Technologies from the Honor ATM network. Page 16

American Express is letting third-party processors and banks market its transaction software, ending a policy by which Amex only marketed the software itself. Page 16

TECHNOLOGY

The big splash at a recent electronic money forum came not from a high- tech giant or an on-line pioneer, but from a Canadian credit union that lets customers conduct banking business using their television set. Page 17

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