Austrian banker wants to end patronage in state-owned business. Shift in mood reflects economic needs, closer ties to Europe

Guido Schmidt-Chiari is a Black in a Red bank. In Austrian terms, that means Mr. Schmidt-Chiari is a conservative, a member of the People's Party, and he is chairman of Creditanstalt-Bank-Verein, which was historically a bank with a heavy Socialist influence in its upper ranks.

But Schmidt-Chiari says, ``I want this bank to be kept out of party politics. I consider myself to be a professional. I will keep out party influences.''

This means using his bank to help end the political patronage that has pervaded state-owned companies in Austria, including banks, since World War II.

The 30-year veteran of the bank became chairman of this largest of Austria's banks March 7. He was soon on the road to the International Monetary Conference, a conclave of the top executives of the 106 largest non-communist commercial banks, held here last week.

Creditanstalt is 60 percent owned by Austria's Ministry of Finance, the bank having been nationalized in 1946. Party patronage has played a heavy role in many such nationalized corporations in the postwar years. In many state-owned companies, the composition of the supervisory boards that appoint management are equally divided between Reds and Blacks.

Schmidt-Chiari, in an interview, said: ``The younger generation is fed up with that. They want to be promoted on the basis of merits and not party politics.''

He does not expect patronage in government-owned companies to vanish overnight. But he does see a mood for a shift in this direction, reflecting the economic challenges facing Austria.

Austria is currently governed by a coalition government of the two major parties. One compromise of the coalition was a decision to privatize only 49 percent of government-owned corporations. So within the next 12 months, Creditanstalt will reduce government ownership to 51 percent - ``depending on stock market conditions.'' The bank will be looking for some foreign shareholders.

Another goal of the coalition is to have Austria join the European Community (EC). At the moment, this small nation is a member of the European Free Trade Association (EFTA). At the time of the first enlargement of the EC in 1972, EFTA negotiated a free-trade arrangement with the EC. Tariffs on manufactured goods traded with the Community were removed.

Membership in the Community, however, would mean a further economic integration of Europe.

Austria would have to give up its own duties on imports from the outside world in favor of the Community tariff structure. Austria would come under the EC's Common Agricultural Policy, involving a higher level of farm subsidies. It would become subject to hundreds of EC regulations covering such areas as technical norms, rights of business establishment, fiscal harmonization, cross-border transport, and professional and academic qualifications.

Schmidt-Chiari sees a mood in Sweden, another member of EFTA, for shifting toward EC membership. But while he sees Community membership more difficult for Switzerland, that mountainous nation's large corporations are already well installed within the EC, he notes.

Franz Vranitsky, Austria's Socialist chancellor, has been speaking of exploratory talks with the Community to find out what membership will entail.

Schmidt-Chiari does not see Austria's neutrality as a problem for entry into the Community, noting that Ireland, a neutral nation, is already a member. The Austrian State Treaty of 1955, under which Austria won its independence from Soviet military occupation, says nothing about neutrality. But it does prohibit a political or economic union with Germany, an EC member. The Austrians contend that EC membership could not be interpreted as union with Germany.

Austrian Foreign Minister Alois Mock may learn whether the Soviets agree when he visits Moscow this summer.

Austrians, in the middle of Europe's East-West division, have long taken a special interest in East European and Soviet affairs. But less than 10 percent of Austria's exports go east.

With glasnost, perestroika, and the Soviet-American summit, Schmidt-Chiari sees a ``state of confusion'' in the USSR.

Speaking of the reforms pushed by Soviet party chief Mikhail Gorbachev, the Austrian banker comments: ``The inertia inherent in the Russian people is not easy to overcome. I hope he will have a certain degree of success. But it is a long-term process. And we in the West are an impatient people.''

As for Creditanstalt, Schmidt-Chiari concedes that the $31 billion bank has ``some ways to go'' to reach new international capital standards for commercial banks being considered by the industrial nations.

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