June 27, 1991

Glenfed Inc., parent of the nation's third-largest savings and loan association, said today that it expected to lose approximately $140 million in its current quarter after accounting for deepening troubles in its real estate development and commercial lending operations. The move reflects a continuing attempt by Glenfed to repair the damage caused by an ill-fated attempt in the 1980's to diversify beyond retail banking and lending for single-family homes into real-estate development and lending to midsized companies.

The NCNB Corporation, a fast-growing banking powerhouse from the Southeast, is negotiating to acquire another large Southeastern banking company in what would be the largest merger in American banking history, setting the stage for a decade of consolidation in the troubled industry. Directors of the C&S/Sovran Financial Corporation, which itself is the product of a merger last year, could decide as soon as today to accept NCNB's offer to combine and become the nation's second-largest banking organization. Its operations would stretch from the coastal cities of Baltimore and Miami to the oilfields of West Texas, and it would have assets of $116 billion. Bigger Than BankAmerica It would surpass the BankAmerica Corporation, which had $111.9 billion in assets as of March 31. Only Citicorp, with assets of $216.9 billion, would be larger in the United States.

As New York City's budget stalemate worsened yesterday, state officials weighed with renewed urgency proposals for long-term recovery that could avert some of the pain and spread the rest over several years. The goal would be to let the city borrow to cover deficits -- which is strictly forbidden now -- without the stigma of invoking the authority of the State Financial Control Board, whose binding powers over the city's budget largely lapsed after the city recovered from its fiscal crisis of the mid-1970's.

On a brisk sunny morning in January, Raul Barreto and his wife, Aida, met a friend at a midtown Manhattan coffee shop. They had just set up a big cocaine deal, Federal authorities say, and were expecting a nice commission. The friend had been showing them around New York for a couple of weeks, and they seemed relaxed as he led them up Ninth Avenue, into a high-rise office building, through a lobby marked Drug Enforcement Administration, past several detention cells and into a small bare room. There, the Barretos realized they were never going to see their $50,000 commission. They were under arrest.

On the walls of their 20-room mansion hung a drawing by Rubens. On the bookshelves were first editions of William Butler Yeats. On the music stand was a score with Richard Wagner's signature. The bed once belonged to Emperor Maximilian of Mexico. And out in the garage were snazzy, mint-condition collector's dream cars: a 1954 MG convertible, a 1957 Ford Thunderbird and a 1974 Rolls-Royce. The two men made a splash on the Philadelphia social scene not only by playing host to socially correct soirees, but also by donating large sums to hard-pressed cultural institutions in the city.