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Stage set for increase in interest from banks

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If, in a few years, you are looking for a place to stash a few dollars, you may find that the banks and saving institutions in your area are using something new to attract your money -- more-competitive interest rates.

With the enactment by Congress of a landmark financial-reform act, US financial institutions will be gradually freed from today's legal interest-rate ceiling and be able to compete with one another by offering higher rates and eventually market-level rates.

The act was signed Monday by President Carter.

Savers will be able to earn more interest on passbook accounts and have access to broad range of new banking services ranging from nationwide NOW accounts (where interest is paid on checking accounts, a service currently available only in New England, New York, and New Jersey) to credit cards authorized by thrift institutions. But at the same time, costs are expected to rise for many instituttions -- particularly smaller banks.

There is also some questions as to whether the legislation -- the Depository Institutions and Monetary Control Act of 1980 -- may be "too little, too late."

"In a way, the whole issue [of raising interest ceilings] may be academic now ," argues Philip M. Comerford, president of State National Bank, Rockville, Md.

The pell-mell rise in assets of money market mutual funds during the last five years, now over $60 billion, indicated that "American savers are very interest-rate-sensitive," says Mr. Comerford. Very few people, he says, "will be content with some [bank] paying 5.5 percent interest if you can get 14 or 15 percent" in a mutual fund.

Under terms of the new legislation -- praised by the US League of Savings Associations as the "most significant" savings legislation enacted since World War II -- interest ceilings on savings accounts will be gradually phased out over a six-year period. Federal bank regulators could speed up that timetable, however,

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