BANKING

Judge Answers Keating Jury’s Question: Los Angeles County Superior Court Judge Lance A. Ito, who is presiding over the securities fraud trial of Charles H. Keating Jr., told jurors that certain small investors in Keating’s company had to exercise “reasonable diligence” to discover misleading or important missing information about bonds they bought. Ito, responding to a question from jurors, indicated that such diligence applied only to transactions that occurred before Sept. 13, 1987--beyond the three-year statute of limitations period. Those sales of American Continental Corp. bonds could be used against Keating only if the bondholders, using reasonable diligence, couldn’t have discovered any fraud during the three-year period for which Keating is liable.