The Treasury yesterday attacked the Federal Home Loan Bank Board's decision to let savings and loan associations sell stocks, bonds and other investments as "the wrong approach to expansion of securities services by S&Ls and banks."

Congress, not regulatory agencies, ought to handle the issue, said Deputy Secretary R.T. McNamar in a statement issued in response to the bank board ruling Thursday that a group of savings and loan associations could go into the brokerage business.

McNamar complained that S&LS would have an unfair advantage over regular stock brokers and warned that securities dealings by S&Ls and banks could be potentially costly to government insurance agencies such as the Federal Deposit Insurance Corp.

The Treasury's chief complaint was that the bank board intended to let S&Ls deal in securities directly, while bank regulators plan to require banks to set up separate brokerage subsidiaries.

"The Treasury Department belives that securities and other financial services should be offered only through a holding company subsidiary which is separate from the depository institution," the statement said.

If that is not done, McNamar warned, "The increased risks of securities activities would fall upon the federally insured institutions and thus the federal depository insurance agencies."