Responding to industry appeals, the IRS said banks will be allowed to use a corporate structure that passes profits tax-free to shareholders. Page 3

The IRS issued two proposals that would make it easier for banks to merge without paying capital gains and other taxes. Page 3


With NationsBank's acquisition of Boatmen's expected to close on Jan. 9, St. Louisans are wondering how the deal will affect jobs and charitable giving in the Midwest river town. But David Darnell, recently named president of NationsBank Midwest, promised the bank wouldn't cut back on Boatmen's civic legacy. "We want people to know NationsBank will continue these things and expand and broaden them." Page 4


Six charters were issued this year for new banks in Texas, which now has more banks than any other state. Page 6


Mortgage lenders that bite the bullet on technology investment stand a much better chance of making it into the next century, a new Arthur Anderson study asserts. Page 7


Chase Manhattan, the country's largest bank, joined processing giant First Data's network of alliances to provide processing services to card- accepting merchants. Page 10

Bank of America is testing the Travel Choices Visa card in Oregon, Nevada, and San Diego. It is the bank's first launch of new plastic since 1994. Page 10


Equifax National Decision Systems added to one of its core products a data base that can help bankers choose safe locations for branches and automated teller machines. Page 12

NationsBank developed a service that uses imaging technology to help its corporate customers thwart check fraud. Page 12


Syndications of two communications loans - a $450 million loan to Chancellor Broadcasting and a $900 million loan for American Radio Systems - have been completed. Page 17

Bankers Trust is syndicating a $100 million facility for a Texas-based offshore oil drilling firm. Page 17


Smith Barney analysts say that excess returns for the banking industry, which have grown rapidly since 1992, are at their highest levels since before 1965. Page 18

A day after Christmas, bank stocks rose amid light trading Thursday. Back page

The Securities and Exchange Commission will adopt a rule early next year requiring companies to disclose potential losses from their derivatives holdings, an SEC commissioner said. Back page

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