The P & L & P of the B of A : ROLLER COASTER The Bank of America and the Future of American Banking<i> by Moira Johnston(Ticknor & Fields: $24.95; 406 pp.; 0-89919-955-0) </i>

The saga of Bank of America has a natural fascination for business writers. It possesses the beguiling logic of a morality play: The sainted founder, A.P. Giannini, builds his retail empire on the trust of poor Italian immigrants and small depositors, only to have latter-day technocrats betray that tradition. As the story of California’s largest bank (and briefly the world’s), it encompasses the state’s economic growth, from orange groves and Disney films to silicon chips and Napa Valley wines.

Before Giannini, the world of high finance was ruled by top-hatted merchant bankers, such as the Morgans and Rothschilds, who catered to a wholesale clientele of sovereign states, large corporations and rich individuals. Giannini conferred new status on consumer banking, showing the economic power in tapping the savings of the masses.

In “Breaking the Bank,” published in 1988, Gary Hector used Giannini quotes as chapter epigraphs, rebuking those successors who had deviated from the master’s wisdom. (I find these supposed gems trite or pious.) In “Roller Coaster: The Bank of America and the Future of American Banking,” business writer Moira Johnston also starts with an idealized founder, then turns to the postwar glory days and catastrophic fall. Writing two years after Hector, she includes the bank’s recovery in the late 1980s.

The two books cover much the same ground and offer similar diagnoses of the decline. Beginning in the 1960s, Bank of America dropped its stress on California retail banking, promoting corporate lending and helter-skelter expansion abroad. Buffeted by huge losses in Latin debt, agricultural and real-estate loans, it reported in 1985 its first annual loss since the Depression.

Both authors fault Tom Clausen, chairman during the 1970s, for not monitoring costs closely or modernizing technology. The bank committed a billion-dollar blunder by not matching the high interest paid on deposits with the lower interest received on loans. In 1981, Clausen left for the World Bank, just in time to escape the disaster he had wrought. For five years, his successor, Sam Armacost, mouthed bromides about impending recovery while avoiding tough action.

Gary Hector told this story in dry, meticulous style. His book is a black-and-white documentary. Moira Johnston’s book, in contrast, is a Technicolor extravaganza, narrated in a fast-paced, kaleidoscopic, almost breathless style. A dogged interviewer, she probes her story relentlessly. The irony is that Hector’s arid account proves engrossing while Johnston’s tale confuses.

Hector’s secret was selectivity. With a clear vision of his story, he evoked his characters with a few salient traits. Although we didn’t learn much about Tom Clausen’s background, we remember his icy, autocratic manner and fear of ambitious subordinates. Johnston captures Clausen’s social insecurity, as when she notes that “a look of fear and blustering confusion still occasionally flashed in his eyes . . .” In a revealing exchange at the exclusive Bohemian Grove, Clausen told another executive how he had never before frequented the best restaurants and hotels and only belatedly learned how to behave at such places. Yet such new details don’t cohere into a sharp portrait.

This blurred vision is even more apparent with Sam Armacost, who spent more than 20 hours with Johnston. Hector showed how Armacost’s smooth boardroom patter concealed the bank’s deteriorating finances. In Johnston’s account, Armacost is less a stand-pat leader and more a victim of bad timing. By late 1983, we learn, he privately pondered the bank’s inner decay: “How deep, how bad is it? How do you contain it?” He banished managers inherited from the Clausen era and hired able executives from Wells Fargo--so many that he feared a Fifth Column from the rival bank.

Johnston presents Armacost’s less flattering side: his rosy recovery forecasts; his tendency to blame setbacks on world events rather than his own stewardship; his excessive deference to the bank’s paternalism, which made firings and branch closings difficult. But she doesn’t reconcile these opposing views of Armacost or arbitrate disputes about his tenure. Was he the beleaguered recipient of Clausen’s mess? The man who perpetuated the problems? Or the leader who initiated a difficult recovery? With each new interview, Johnston seems to adopt a fresh point-of-view, leaving the reader bewildered.

This failure to make consistent assessments of people is seen in her handling of Dr. Ichak Adizes, the Yugoslavian-born management guru hired by Armacost to rejuvenate the bank’s executive culture. With his jargon and acronyms, Adizes subjected senior management to endless encounter groups and therapy sessions. Yet one cannot tell from Johnston’s account whether he was a genius or a glib charlatan.

Curiously, Johnston omits examination of the bank’s notoriously spineless board, so roundly condemned by the press in the mid-1980s. These credulous gentlemen supported Armacost through five thankless years and their passivity became a national disgrace. When they finally rebelled, they restored Clausen as chairman. This resurrection of Clausen--the architect of the bank’s disasters--is the most extraordinary twist in the tale. Yet Johnston mentions it without surprise or even comment. When a disgruntled shareholder shouts at Clausen, “Why did you come back?” we, too, want to know the answer.

In fairness to Johnston, she had the fiendishly difficult job of telling a story of rise, fall, then rise again--a roller-coaster ride. She didn’t have the luxury of Hector’s one-dimensional tale. When she writes of Armacost’s mid-1980s forecast that the bank would book a billion-dollar profit by 1990, she must note: “Within a year, as the bank announced a half-billion-dollar loss for ‘86, his words would sound hollow. Three years later, as profits climbed to within a few million of his goals, they would make him a prophet.” Clearly, Johnston is shooting at a moving target and we can sympathize with her plight.

In her book “Takeover,” Johnston used a rapid, fragmented style to convey the manic world of Wall Street deal makers. The complex Bank of America story requires a greater lucidity. Johnston worries too much that the reader will fall asleep and resorts to florid, hyperbolic language. When she narrates the 50th-birthday celebration of the Golden Gate Bridge--financed by Giannini--she describes its significance as comparable to that of King Edward VII’s funeral. The gray Bank of America bureaucrats suddenly are “the greatest assemblage of commercial-banking wealth since modern banking began in the early Renaissance.” At another point, the old Bank of America loan committee is likened to “an assembly of the gods . . .”

In the last analysis, Johnston overreaches. She tries to transform her story into a big, sweeping saga that includes, for instance, the story of Charles Schwab, whose discount brokerage was briefly taken over by the bank, and Sandy Weill, who made an abortive bid to become chairman. She also weaves in extraneous information about Walter Wriston and John Reed of Citicorp. Instead of enriching the narrative, these digressions only make it more cumbersome. Johnston begins to track people long before their involvement with Bank of America starts, then follows them long after they’ve left.

In the end, one yearns for the lean, elegant book buried somewhere inside this sprawling patchwork. Less, alas, would have been more.