TWO years after nearly sinking from extravagant spending on executive jets, marble-clad offices, and unjustifiable management ''perks,'' the European Bank for Reconstruction and Development (EBRD) is back afloat.
Many credit President Jacques de Larosiere with the turnaround of the London-based institution launched in 1991 to boost economic recovery in Europe's former Communist states.
Mr. de Larosiere, a low-profile, technocratic French central banker, stepped into the Gucci shoes of Jacques Attali in 1993, who resigned after being accused of spending more on his own bank's headquarters than on loans to ex-Communist Europe.
De Larosiere has ''transformed the grandiose waste'' that ''typified Mr. Attali's management style,'' a senior staff official said. ''More important, he has adopted a practical approach to helping east-central European economies, by properly researching requests for funds, and making sure the money goes where it is supposed to go,'' the official said.
At the EBRD's annual meeting in London earlier this month, De Larosiere insisted the bank is succeeding in its goal of helping ex-Communist countries switch to market economies.
''We are helping the old East bloc to come to grips with the basic principles of capitalism,'' he says, ''whether containing price rises, liberalizing trade, or privatizing inefficient state industries.''
De Larosiere reported that about two-thirds of the bank's initial capital of 8.3 billion pounds ($13.3) had already been committed. But the governments that provided base capital for the bank told him that to qualify for a further injection of funds, the EBRD would have to trim its own running costs still further.
Kenneth Clarke, Britain's chancellor of the exchequer, seemed to capture the praise-and-warning spirit of the EBRD gathering when he congratulated De Larosiere on curbing the ''excesses'' of the short-lived Attali era. But he complained that 12 pence in every pound of the bank's budget was still being channeled to cover the administrative costs of the institution and its 23-member board of directors.
''This is far too high,'' Mr. Clarke said. A member of the German delegation led by Finance Minister Theo Waigel said the bank should ''practice what it preaches to Eastern Europe'' and go further with its ''new culture of thriftiness.''
Lawrence Summers, United States Treasury undersecretary, also attacked the high cost of the board of directors and said an increase in the EBRD's capital funding ''will have to wait.''
As recipients of EBRD funds stepped to the podium to report to the annual meeting, it became evident that progress varies widely among the former Communist states.
Petr Prochazka, a senior Czech central banker, claimed a decisive shift to a market economy had already taken place in his country.
''The transition is completed,'' he said. ''We're now facing a post-transition state.''
The Czech Republic has a growth rate of 4 percent, a budget surplus, and unemployment running at about 3 percent.
Poland's deputy privatization minister, Ewa Freyberg, reported that her country's privatization program was about to be stepped up, with some 4,000 state-owned companies about to be sold off.
The Warsaw government was already having talks with Western investment banks on establishing pension funds for people in privatized firms. ''We hope to start the process this year,'' Ms. Freyberg said.
But some ex-Communist countries face difficulties that EBRD lacks funds to deal with. Oleg Popov, special adviser to Leonid Kuchma, president of Ukraine, said offers to help shut down the two reactors still operating at Chernobyl ''do not even begin to cover the costs of closing the stations.'' Britain, France, and Germany offered several million dollars, but Mr. Popov said the cost of closing the stations and replacing the energy they generate could be as high as $14 billion.
On the other hand, with EBRD help, Ukraine had privatized 300 large companies this year, and plans to sell another 8,000.