Treasury Posts Filled by Clinton : Banking: A Yale classmate is named comptroller. Another appointment may affect the line of management succession at Bank of America.

President Clinton on Thursday named Eugene Ludwig, an old friend and fellow Rhodes Scholar and Yale Law School graduate, to one of the most powerful and controversial banking regulatory posts in the federal government.

Ludwig, a 45-year-old Washington lawyer, was named comptroller of the currency in the Treasury Department, putting him on the front lines in the Clinton Administration’s efforts to deal with the banking crisis and the credit crunch.

Meanwhile, Bank of America Vice Chairman Frank Newman and World Bank chief economist Lawrence Summers were both named to senior posts in the Treasury Department. Newman, 50, was named undersecretary for domestic finance, while Summers, 38, was named undersecretary for international affairs.

All three are subject to Senate confirmation.

In naming Newman to a Treasury post, Clinton picked an executive widely respected on Wall Street for his role in helping BankAmerica accomplish one of the biggest banking turnarounds in history.

Newman has periodically been mentioned as a possible successor to B of A Chief Executive Richard M. Rosenberg, although most B of A observers have said they believed that Newman would eventually have lost out to Vice Chairman Lewis Coleman. Separately, B of A named Coleman to the additional post of chief financial officer, succeeding Newman.

Newman’s departure now puts Coleman on the inside track to eventually take over.

Ironically, Newman may be an advocate of the kind of banking reforms that the Bush Administration unsuccessfully sought from Congress in recent years. BankAmerica has been one of the most outspoken advocates of such reforms, including legislation to allow for full interstate banking.

Banking industry lobbyists, however, caution that the transition team decided not to make such reforms a high priority. Instead, the new Administration seems committed to focusing on Clinton’s plan to fund up to 100 new community development banks across the country to increase the amount of credit available to small businesses in inner cities.

And in Clinton’s first official act on the economy, he relaxed deficit-reduction targets that would have triggered automatic spending cuts.

The White House said that failing to ease the deficit ceilings could have meant 11% across-the-board cuts in both defense and domestic programs. Communications Director George Stephanopoulos suggested that forced cuts in defense spending would be unwise with U.S. forces in Somalia and the Persian Gulf.

Clinton’s move--under a 1990 deficit-reduction law--had been anticipated since the deficit targets are widely viewed as unattainable.

The Treasury appointment represents a remarkable recovery within the Clinton camp for Summers, who suffered during the transition when a controversial memo he wrote at the World Bank on environmental matters kept him from winning the job he most wanted--chairman of the Council of Economic Advisers. He lost that post to Laura D’Andrea Tyson. But his new position might be considered even more powerful, since he will be involved in a broad range of international matters, such as aid to the republics of the former Soviet Union.

Ludwig’s pedigree seems golden. He is one of only two people who was both a Rhodes Scholar with Clinton and attended Yale Law School with him--Labor Secretary Robert B. Reich was the other. Ludwig’s Washington law firm represents Nationsbank, based in Charlotte, N.C., and one of the largest commercial banks in the country.

He was in charge of banking issues for Clinton’s transition team. But congressional and industry officials say that Ludwig has never been a major player in banking policy issues in Washington. As a result, his views are generally unknown on such critical matters as how to deal with the credit crunch and whether the government should ease up on its supervision of banks.

Ludwig takes over a position that has become a lightning rod for congressional anger over the banking crisis. The job has been vacant since February, 1992, when his predecessor in the post, Robert Clarke, was rejected for a second five-year term.

Times staff writer James Bates contributed to this article in Los Angeles.