Two major trade groups representing the thrift industry have begun discussions that could result in a merger before the end of the year.

Richard S. Lawton, outgoing president of the National Savings and Loan League and chairman of Washington-Lee Savings and Loan in Northern Virginia, confirmed during the league's annual conference here last week that league directors have authorized a committee to begin negotiations with representatives of the National Association of Mutual Savings Banks.

Lawton, appointed chairman of the National League's negotiations committee, said a joint meeting will be scheduled to discuss the merger, probably within three weeks.

Meanwhile, staffs of the two trade groups are preparing studies on the feasibility and logistics of a merger.

The National League represents about 250 of the larger savings and loan associations, and the NAMSB is the umbrella organization for about 350 savings banks. The two groups have combined assets of more than $300 billion.

The National League's offices are in Washington, but the NAMSB is based in New York. The merged group would establish new headquarters facilities in the District.

Lawton said both organizations would benefit from the merger. "We believe our views are very compatible in terms of regulatory needs."

Lawton emphasized that the merger possibility is "not brought about by any situation in the savings and loan industry today. Neither the National League nor the National Association of Mutual Savings Banks is in any danger of going out of business.

"We have a lot of things in common. Both are aggressive organizations and both are interested in the new era which we're operating in."

NAMSB officials recently indicated interest in discussing merger possibilities with the 4,000-member U.S. League of Savings Associations and possibly the American Bankers Association.

Richard T. Pratt, chairman of the Federal Home Loan Bank Board, told convention delegates here last week that the thrift industry can compete in a changed economic environment if given the proper tools.

Pratt said the industry has been the "most controlled and protected business" over the past 50 years. What's needed, he added, is a change in regulatory philosophy.

That type of approach is the keystone of a bill that the bank board has had introduced in the Senate. The so-called Pratt bill would give S&Ls virtually all the powers commercial banks have in domestic operations.

First though, the Senate will begin hearings on a more comprehensive bill to deal with the problems of all financial institutions. That package, which includes most provisions contained in the Pratt bill, was introduced by Senate Banking Committee Chairman Jake Garn (R-Utah).

Pratt told reporters he could support the Garn bill if two controversial provisions were deleted.

One section of the Garn bill would pre-empt state laws banning due-on-sale clauses in mortgage contracts written by all lenders. States could reimpose the bans within three years, however.

Pratt's bill pre-empts state laws banning due-on-sale clauses by federally chartered lenders and makes no allowance for state override. Pratt said he will push to make the pre-emption permanent for federally chartered institutions.

On another point, Pratt said he opposes Garn's proposal to merge the Federal Deposit Insurance Corp. and the Federal Savings and Loan Insurance Corp., which insure deposits in banks and savings and loans, respectively.