ROANOKE TIMES 
                      Copyright (c) 1996, Roanoke Times

DATE: Wednesday, April 10, 1996              TAG: 9604100053
SECTION: BUSINESS                 PAGE: B-6  EDITION: METRO 
DATELINE: RICHMOND
SOURCE: Associated Press

BANK SAYS ITS PROFITS GOING UP IN SMOKE

Signet Banking Corp. on Tuesday adjusted its 1995 earnings to account for a $35 million pretax charge it will take in connection with possible losses in an alleged international loan scam.

The company said its consolidated net income for the year ended Dec. 31 was $111 million, or $1.86 per share.

A former Philip Morris employee is accused of defrauding Richmond-based Signet, NationsBank of Charlotte, N.C., and banks in three other countries of millions of dollars. The FBI says Edward Reiners got the loans by convincing the banks he still represented Philip Morris, which needed computer equipment for a top-secret cigarette research project.

The project was fictitious, and Philip Morris did not know of the scheme, the FBI said. Reiners and an alleged accomplice, Judy Bachiman, have been charged with bank fraud.

Signet said it approved $81 million in loans for Reiners. The $35 million charge is an estimate based on ``federal authority reports about assets restrained to date,'' the company said in a statement.

The $35 million figure ``could either be higher or it could be lower,'' said Signet spokeswoman Teri Schrettenbrunner.

David West, a banking analyst at Davenport & Co. in Richmond, said he wasn't sure how the situation would affect shareholders, saying it largely depends on whether any other liabilities develop stemming from the case.

The FBI arrested Reiners and Bachiman March 19. Authorities began investigating Reiners after the Long Term Credit Bank of Japan questioned a loan document, and the other banks became suspicious.

The company also said its shareholder meeting originally scheduled for April 23 would be postponed until May 28 because of delays caused by the adjusted figures.

LENGTH: Short :   42 lines