November 27, 1991

New York yesterday became the first city in the nation to begin making condoms available to all its public high school students. At John Dewey High School in Brooklyn, one of two schools to inaugurate the program, teen-agers who had just been given condoms held them up for television and newspaper cameras as the students posed with their boyfriends and girlfriends outside the school's gates.

As if awaiting the sequel to a riveting movie, or because even an incident of horror could not pry them from their daily routine, most of the students and teachers at Thomas Jefferson High School returned to classes yesterday, the day after a student was killed and a teacher was wounded by gunshots in a hallway. The death scene on the third floor had been gruesome enough, but then students learned a few hours later that the police had arrested one of their own, a 14-year-old boy, in connection with the shootings. Held Without Bail The student, Jason Bentley, was arraigned in Brooklyn Criminal Court yesterday on charges of second-degree murder and second-degree criminal possession of a weapon. He was held without bail.

To Marvin P. Middlemark, life was a rollicking adventure. He had a flair for finding exotic uses for the wealth that rained down on him for inventing the "rabbit ears" television antenna. He was unabashedly at ease keeping a pet chimpanzee, which sometimes answered the front door of his home and got soused at parties. And thus perhaps it is all too fitting that ever since Mr. Middlemark's death more than two years ago, the strife that has surrounded the pursuit of his inheritance has seemed like a twisted adventure out of Dickens.

In the hours before Congress was to begin its Thanksgiving recess, lawmakers worked today to resolve differences on a slimmed-down banking bill that would provide new money for the bank insurance fund, as the Administration had asked. But the bill included none of the broad changes in the half-century-old laws governing the banking industry that the White House proposed in February. By late in the afternoon, House and Senate negotiators had agreed to drop provisions in the Senate bill that would have eased barriers to interstate banking. The interstate banking measure had been the last significant White House recommendation left. Measure Bogs Down But the bill bogged down in the evening over a variety of smaller provisions that would give regulators greater authority to take over weak institutions and limit the insurance coverage on bank deposits sold by Wall Street investment houses.

In a progress report as they move toward a merger at the end of the year, Chemical Bank and Manufacturers Hanover said yesterday that they had started trimming staff and were confident that savings from the merger would be greater than the $650 million they had forecast. Joseph G. Sponholz, Chemical Bank's chief financial officer, who is coordinating many parts of the merger, said the $650 million in annual savings after three years "is both a floor and in the bag." The greatest part of the savings, or about $350 million, would come from a sharp cut in employment at the two banks, both of which have steadily reduced their work force the last few years. 6,200 Fewer Jobs The banks, which will operate under the Chemical name, expect to eliminate 6,200 jobs, or about 14 percent of the 44,400 workers they had at midyear. About 1,100 jobs have already been eliminated, mostly by not replacing workers who quit or retired. But more painful cuts are coming, and 2,000 more workers are expected to lose their jobs in the first half of next year. Last week, the Chemical Banking Corporation said that 200 workers in corporate finance, or about 20 percent of the department, were given notice last week and would be out of the bank by next week. Mr. Sponholz said that most employment cuts would involve clerical workers, but added that managers would be cut in the same proportion as lower-paid workers. He said the company had no plan to balance cuts or plum assignments evenly between the banks. Besides laying plans for job cuts, officials at the banks have chosen 25 of the 32 computer systems to be used by the new Chemical. The 70 branches to be closed have been identified, and the banks have decided to run their credit-card business from the Manufacturers Hanover Trust Company's processing center in Hicksville, L.I., closing Chemical's operation in Delaware and part of the bank's processing center in Jericho, L.I. Before the merger announcement in July, Chemical and Manufacturers had been keeping a tight rein on payrolls and expenses. Since the end of 1989, the companies had reduced staffs by about 4,765. New Stock Issue Yesterday's meeting with securities analysts comes just as the banks are eager to convince investors that they will be more profitable and stronger after the merger. The companies are planning meetings between investors and top managers to help attract buyers for the $1.25 billion in common stock they plan to sell in January. The stock offering, which was registered with the Securities and Exchange Commission yesterday, would be the largest by a banking company. Money from the sale would pay for the $550 million in expenses for severance payments to employees and for losses on abandoned branch offices and other real estate, as well as for strengthening the financial condition of the new Chemical Bank. When Chemical and Manufacturers Hanover announced their merger plan, they estimated that the companies' combined expenses of $4.6 billion could be reduced by $650 million over three years. The savings would come from eliminating about 6,200 jobs from combined payrolls of 47,500, and by eliminating duplicated operations, ranging from Chemical's old headquarters on Park Avenue to 70 branches in the New York area. Fed Approval Seen Soon Peter J. Tobin, Manufacturers Hanover's chief financial officer, said that the Federal Reserve was expected to approve the merger within "the next day or two" and added that the "Justice Department has indicated to the Fed it will not challenge any aspect" of the merger. Despite the confident statements by Chemical and Manufacturers executives that they will meet their targets for expense cuts, Chemical's stock price has lost the momentum it gained after the merger was announced. "The cost savings will be real, but the market is worried right now about the weak economy and its effect on banks," said Brent Erensel, an analyst at Mabon, Nugent & Company. He said Chemical's stock, which traded as high as $30.125 a share in mid-August, was also depressed by the prospect of more than 50 million new shares to be offered in January. Chemical's stock closed yesterday at $22.25, down 12.5 cents, while Manufacturers' also fell, by the same amount, to $25.