August 30, 1995

It is certainly no surprise to John S. Reed, the chairman of Citicorp, that his bank will no longer be the largest in the United States. In recent remarks to reporters, Mr. Reed cracked that if Richard M. Rosenberg, the chief executive of the BankAmerica Corporation, made one more acquisition, the San Francisco bank would leap from second to first. The name is different, but the outcome for Mr. Reed is the same. The combination announced Monday between the Chase Manhattan Corporation and the Chemical Banking Corporation would create a bank with $297 billion in assets, jumping ahead of Citicorp at $257 billion.

In a remarkable demonstration of faith that stock prices have nowhere to go but up, investors poured more money into mutual funds that invest in American stocks last month than ever before. And the trend in August appears to be as good or better, executives at several of the largest mutual fund companies said. The Investment Company Institute, a mutual fund trade group, reported yesterday that investors put a net $12.4 billion in July into equity funds that invest primarily in American stocks. That was up a sharp 57 percent from the $7.9 billion net gain recorded in June and smashed the old monthly record of $10.2 billion, set in March 1993.

A chart in this space yesterday misstated the number of vehicle accidents on the Triborough and Verrazano-Narrows bridges from 1991 to 1994.

At 2 P.M., the clique of paparazzi who hunger for celebrities outside the Princess of Wales's favorite restaurant, San Lorenzo, disperse in temporary defeat, with neither the princess nor other glitterati in sight. They miss, five minutes later, the queen of Irish writers, Edna O'Brien, walking briskly into view: tall, hatless, her wavy dark red hair her shining crown, her long diaphanous skirt swirling slightly in the dead heat-wave air. She could be one of her own characters, a striking woman coming to lunch with a charming but feckless lover, trying to hold things together. She has not come to be seen, not this time. She smiles broadly, thin lips very red, and in her lilting County Clare accent, negotiates with the manager. We get a table on a small balcony in the restaurant, which was designed by her son Sasha Gebler, an architect, above the din of those who have come to ogle, to nibble lightly sauced pasta and fish, to gossip about people like Ms. O'Brien.

NATO warplanes swooped over Sarajevo in darkness early today and began bombing Bosnian Serb positions to the south and east of the city, the Western alliance announced. The attack, which started around 2 A.M. and appeared to be concentrated initially in areas close to the Bosnian Serb headquarters in Pale, was a response to the devastating Serbian shelling of the Sarajevo market area on Monday.