"Ten years ago, I said one of the biggest competitors of banks was the telephone company." Walter Wriston recalled. "Everyone laughed and laughed. Well, they are not laughing anymore."

The former Citicorp chairman said the highly successful AT&T Universal card is a prime example of how core bank businesses are being lost to nonbanks.

"Now we have General Motors" offering credit cards," Mr. Wriston said in an interview last week. "With all their trouble, they still have a cash flow that just won't quit." And unlike banks, "they do not suffer from a regulatory environment which is draconian."

Blasting Regulation

While plugging his new book, "The Twilight of Sovereignty," Mr. Wriston, 73, has been speaking out against overregulation of banks.

Last week, in a radio interview, he said the credit card market is the third major one that banks are losing control of. Commercial lending and inventory finance are the other two.

He finds it ironic that despite the new entrants, "banks are still regulated as if they were a monopoly," he asserted in the subsequent telephone interview.

Active as both an author and corporate director, Mr. Wriston offered credit card bankers this thought: "Until the banking business gets together and projects a solid front in Washington," Congress will continue to engage in "government-assisted euthanasia of the banking business."

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