FALLOUT FROM BANK CONSOLIDATION PIQUES INTEREST OF LAWMAKERS.

Byline: Marcy Gordon Associated Press 

Concern about the wave of huge bank mergers sliced across party lines, as members of the House Banking Committee voiced worry Wednesday consumers could be hurt by higher fees and reduced competition among banks.

A top Treasury official, Undersecretary John D. Hawke Jr., said the Clinton administration shares that concern, but some lawmakers weren't convinced.

Rep. Bruce Vento, D-Minn., said no federal banking regulators appeared to have a ``fire in the belly'' about ensuring consumers are protected as big banks and other financial institutions combine.

``I thought this was supposed to benefit consumers,'' Vento told the hearing as Congress took its first look at the newest outbreak of financial merger mania.

Other Democrats, led by Rep. Joseph P. Kennedy II of Massachusetts, called on regulators not to approve any of the new mergers until congressional investigators have studied their impact on consumers.

And other lawmakers evoked the specter of the multibillion-dollar taxpayer bailout of the nation's savings and loan industry in the late 1980s, warning that some banks could become so big through mergers that the government wouldn't allow them to fail.

In stunning developments this month, NationsBank Corp. and BankAmerica Corp. announced a $57.2 billion marriage to create a coast-to-coast banking behemoth, and Banc One Corp. and First Chicago NBD Corp. said they will unite in a $27.1 billion deal to form the dominant bank in the Midwest.

News of the two combinations came just a week after banking giant Citicorp announced a planned megamerger with brokerage-insurer Travelers Group that valued each company at $68.9 billion.

In addition, Washington Mutual, the nation's largest thrift, last month agreed to acquire H.F. Ahmanson & Co., parent of Home Savings of America, for $9.6 billion in stock. The deal would culminate a 22-merger binge by Washington Mutual, including last year's acquisition of Chatsworth-based Great Western Savings over a competing bid by Ahmanson.

And earlier this month, Household International announced a $7 billion stock purchase of Beneficial Corp., combining two of the largest consumer finance companies in the country.

Rep. Michael Castle, R-Del., while noting he is generally supportive of banks, said many of his constituents are upset about rising bank fees and ``impersonal'' service at a time of record bank profits.

His message to the banking industry: ``Don't forget about the customer.''