August 29, 1995

Hilda Dreuer was clipping wet clothes to the wash line, the marsh wind riffling her flowered terry cloth jump suit, when a dark-tanned man made his way over the creaking planks of the three-foot wide boardwalk that passes for East 12th Road. The man, Daniel F. Mundy, was a week late with the news, but he knew it would not matter. The Dreuers and the others who occupy the wooden houses that spike up on stilts in the marshes of Jamaica Bay were unlikely to have heard already.

When Emergency Medical Service paramedics entered the Brooklyn apartment on Aug. 12, there were already five firefighters standing in the living room, along with a 72-year-old woman seated on the toilet of the bathroom, an oxygen mask on her face. The picture of apparent calm, however, was misleading. The woman, it turned out, wasn't breathing and didn't have a pulse. Despite frantic attempts to save her -- an effort the E.M.S. workers have said the firefighters refused to help once E.M.S. arrived -- the woman, Rachel Rosen, died later at Coney Island Hospital.

Chemical and Chase In $10 Billion Merger Creating the biggest bank in the country, the Chemical Banking Corporation said it would merge with Chase Manhattan in a deal valued at nearly $10 billion. It would form an institution with $297 billion in assets, overtaking Citicorp. The combined bank would take the Chase name, although Chemical is the larger bank and is the dominant partner in the merger. Walter V. Shipley, the chairman and chief executive of Chemical, will keep those titles at the new company. [ Page A1. ] Some New Yorkers fear that the merger will accelerate a decline in service in neighborhoods like Harlem, Bedford- Stuyvesant and the South Bronx. [ A1. ] About 12,000 positions will be cut in the next three years, roughly a third of them in the New York area, the two banks said. [ D7. ] The deal has better-than-even odds of working out, many banking experts said, largely because Chemical merged successfully with Manufacturers Hanover in 1991. [ D6. ] National City to Buy Integra The National City Corporation of Cleveland has agreed to buy Integra Financial for $2.1 billion in stock in a deal that is to create a banking company with $50 billion in assets and bring an outside institution into the Pittsburgh area for the first time. Integra's stock jumped $5.25 a share, to $57.125. [ D5. ] In another bank deal, First Nationwide Bank has agreed to acquire San Francisco Federal Savings and Loan for $250 million. [ D5. ] Knight-Ridder to Acquire Lesher Knight-Ridder said it would acquire Lesher Communications for $360 million, expanding the newspaper chain's reach in the San Francisco suburbs. [ D2. ] Cardinal Health in Deal Cardinal Health, a distributor of health care products, said it would acquire Medicine Shoppe International, the largest franchiser of drugstores in the nation, for $348 million. The proposal surprised some analysts. [ D4. ] Stratus to Cut Work Force Stratus Computer said that it would dismiss 500 employees, or 18 percent of its work force, to reduce costs and that it would take a $20 million charge for the third quarter. [ D4. ] Judge Reverses Verdict on Patents A Federal judge has reversed a jury verdict that ordered three semiconductor companies to pay Texas Instruments $51.8 million in damages for patent infringement on a computer-chip-packaging technology. The judge ruled that there was insufficient evidence to prove that Cypress Semiconductor, VLSI Technology and LSI Logic had infringed on two Texas Instruments patents. [ D4. ] First Data to Shed Part of Unit First Data has agreed to shed the sales and marketing operations of either Moneygram or Western Union as a condition for Federal clearance of its $6.7 billion acquisition of First Financial Management. [ D4. ] Employer-Preferred Health Plans A growing number of employers are offering health coverage that rewards people who use few or no medical services. The plans, which involve medical-savings accounts for employees, are finding friends on Capitol Hill, and supporters say that such coverage can slow spending on health care. [ A15. ] Japan to Close Cosmo Credit Japanese authorities announced details of a $2.7 billion plan to close Cosmo Credit, a Tokyo credit union, and repay its depositors. The plan is to include loans from the nation's central bank, the Tokyo city government and Japan's deposit-insurance agency. [ D2. ]

A member of the Town Council said yesterday that Chief Robert Spina of the West Orange police was likely to return to work before the Council decides how to handle a judge's findings that he had abused his wife. Last month, Mr. Spina, who was appointed to his post by his father, the town's Mayor, took a leave of absence until Sept. 5, and the Town Council asked the State Attorney General and the Essex County Prosecutor to look into the matter.

Creating the biggest bank in the country, the Chemical Banking Corporation said yesterday that it would merge with the Chase Manhattan Corporation in a deal valued at nearly $10 billion. The combined bank would take the better-known Chase name, though Chemical is much bigger than Chase and is the dominant partner in the merger. Walter V. Shipley, the chairman and chief executive of Chemical, will keep those titles at the new company. The combined bank would have $297 billion in assets, overtaking Citicorp as the nation's biggest.

Two shells slammed into the central Sarajevo market area today, killing at least 37 people and wounding 80 in the most devastating single attack on the Bosnian capital since a similar one 18 months ago led NATO to vow that the city would be protected. Limbs and flesh were splattered on storefronts, and bodies fell to pieces as they were lifted into cars. After 40 months of Serbian siege and bombardment, the scene was familiar, but the horrified frenzy among an exhausted population was still intense.

A warrant has been issued for the arrest of a Jersey City man who is accused of fatally shooting his estranged girlfriend in the head as she knelt at her bedside, authorities said. Carmen Messano, Hudson County Prosecutor, said Luz Portocarrero was on her knees with her face and upper body slumped onto the bed when her body was found Sunday night, but he could not be certain she was praying.

The designer Calvin Klein's abrupt about-face in withdrawing advertising that angry critics likened to child pornography -- the first time he acceded to demands that he halt a campaign before its scheduled end -- is generating a fierce debate over whether there are limits in advertising and, if so, whether Mr. Klein, always adept at testing the boundaries of acceptability, had crossed a line. Calvin Klein Inc. announced yesterday that the campaign, for the designer jeans bearing Mr. Klein's name, would cease "as soon as possible" because it had been "misunderstood by some." Since the campaign was introduced this month, the company had been engulfed by complaints contending that the television commercials, print advertisements and outdoor signs were salacious and exploitative because young models had been posed suggestively and tastelessly.

Proposals by the Jersey Central Power and Light Company to eliminate or modify programs that give customers financial incentives for reducing energy consumption were attacked yesterday by a public-interest group. Rebecca Stanfield, energy advocate for New Jersey Public Interest Research Group Citizen Lobby, said the proposals, which need approval from the Board of Public Utilities, "demonstrate corporate irresponsibility at its worst."

An ordinance that would have banned all cigarette vending machines from public places as of Friday was partly blocked yesterday by a Bergen County Superior Court judge. The judge, Patrick X. J. Fitzpatrick, issued a temporary restraining order to prevent the measure from taking effect, but he said the order applied only to machines with locking devices enabling bartenders and cashiers to prevent minors from buying cigarettes.

The proposed merger of the Chase Manhattan and Chemical Banking corporations will make a big winner of Michael F. Price and his Mutual Series family of funds, whose 11 million Chase shares are worth $273 million more -- or 70 percent -- than when they were bought less than six months ago. Plenty of other mutual-fund managers have also been buying shares of both banks in recent months. And while Mr. Price certainly hit a home run for investors in the funds he manages, it was James P. Barrow, manager of the Vanguard Windsor II fund, who truly knocked the cover off the ball.

Donald J. Trump is buying another mansion: a 14-bedroom, 28,322-square-foot Mount Kisco chateau, Seven Springs. He plans to turn it and its surrounding 200 acres into a golf course with an astronomical entrance fee. Mr. Trump signed the contract to buy the estate last week. Article, page B4.