Away from Secrecy

The world's largest bank has long been tight-lipped about its business. Now it is pledging to become almost garrulous. Last week the San Francisco-based BankAmerica Corp. flew five senior officials to New York to unveil, with maximum publicity, a 26-page, 70-item "Voluntary Disclosure Code," under which the bank proposes to make available information that goes far beyond what banks are compelled by law to reveal. The disclosures, say bank officials, should help to dispel public suspicion of business and keep BankAmerica's executives toeing the mark. Intones a preamble to the code: "What better inhibitor to misconduct or ineptness than the certain knowledge that one's actions will become known?"

Some of the future disclosures do promise to be interesting. Mortgage borrowers, for example, will be told the bank's appraisal of the value of property they offer as collateral. The bank's trust department will divulge the nominees or "street names" under which it trades stock--essential information for anyone trying to check its investment performance. Employees will be given more information about salary ranges.

BankAmerica further vows to reveal "direct dollar expenses" of its "government relations" programs (which include lobbying efforts) at federal, state and local levels. It will list all companies in which its trust department has investments of $1 million or more, disclose its ten largest holdings of municipal securities and report its profits or losses on dealings in foreign currency. All these matters are of interest to analysts who try to gauge the soundness of bank finances; Franklin National Bank in New York, for instance, failed in 1974 largely because of huge losses in foreign-currency speculation.

Legitimate Need. There are more than a few exceptions to BankAmerica's new openness. For instance, bank analysts are worried about the soundness of loans that U.S. banks have made to underdeveloped countries, but Bank-America will shed little light on the problem. It will break down its foreign loans into eight major regions of the world, but not by country. Other banks already make available some of the information that BankAmerica now plans to disclose, and release of some other data may soon be compelled by the Securities and Exchange Commission, anyway. The bank has left itself some outs. The code says that BankAmerica will disclose information only to those "with a legitimate need," though officials promise that they will interpret this to include reporters, stockholders and borrowers.

There are indications that the bank's officers were divided on how open to be. President A.W. Clausen appointed a task force that was supposed to draft the code in six months; it took ten months. Says Executive Vice President Leland Prussia: "We really did plunge into some icy waters." On balance, the bank emerged with a code that is a welcome step away from needless secrecy.

This file is automatically generated by a robot program, so viewer discretion is required.