Three Maryland savings and loan associations and an Army recreation and family aid fund stand to lose money as a result of the failure of a New Jersey government securities firm.

Losses could reach as much as $198 million in the collapse of the Bevill, Bresler & Schulman companies, a group of Livingston, N.J. firms that provided loans and investment services to financial institutions and governments.

The District of Columbia government invested $10 million with the firm, but apparently will lose no money because it insisted on possession of govenment securities to guarantee repayment of its investment, said Alphonse G. Hill, deputy mayor for finance.

Among the biggest losers is the Army Central Banking and Investment Fund, which court papers say could be out $11 million dollars. The fund is a $370 million pool of surplus cash raised from post exchange and vending machine profits and other sources of non-appropriated money, a Pentagon spokesman said yesterday.

The Army fund is the fourth-largest creditor of BB&S, whose assets were ordered frozen yesterday by a federal judge in Newark, N.J., after the firm filed for bankruptcy protection.

Merritt Commercial Savings and Loan of Baltimore is listed as the 17th-largest creditor, facing a loss of $2.2 million, BB&S said in its bankruptcy petition. Old Court Savings & Loan of Baltimore and York Ridge-Calvert Savings and Loan of Pikesville are also owed money by BB&S, but the amount is not shown in court records.

All three Maryland associations apparently borrowed money from BB&S and put up government bonds and notes as collateral under what are known as repurchase agreements. The securities were supposed to be held by an independent third party, but some of them may be missing or may have been used by BB&S as collateral for other loans, SEC investigators said.

Merritt issued a statement saying, "the amount at risk . . . is well under 2 percent of assets and we are confident that we will recover the full amount due us from Bevil Bresler and Schulman. Merritt is sufficiently liquid to meet all its commmitments to its depositors and borrowers."

Securities and Exchange Commission officials were less optimistic about the chances that Merritt and other creditors will get their money back. They said total losses are expected to be at least $148 million and are likely to reach $198 million by the time BB&S's finances are untangled.

A Merritt executive said the $2.2 million exposure listed in court records "doesn't make any sense" because the institution thought it was protected from any loss.

While the $2.2 million loss amounts to a tiny fraction of Merritt's total assets, it is equivalent to almost one-sixth of the association's net worth of about $15 million. Net worth is the capital available to back up a financial institution, the amount left after its liabilities are subtracted from its assets.

Merritt and Old Court are state-chartered and insured by the private Maryland Savings Share Insurance Corp. With assets of $839 million as of Dec. 31, Old Court is the second-largest MSSIC-insured institution behind Chevy Chase Savings and Loan. Merritt had year-end assets of $339 million and is the ninth-largest state chartered Maryland S&L.

Charles Brown, director of the state Division of Building, Savings and Loan, said any losses suffered by the two associations will not threaten the insurance fund. The health of all private deposit insurance plans has come into question since Ohio's fund was wiped out by the failure of E.S.M. Government Securities last month.

"We are concerned, but it is not going to effect the associations," said Brown. "They have ample net worth and ample earnings."

MSSIC insures the depositors in Maryland-chartered S&Ls and does not protect the associations themselves from losses. MSSIC would be required to step in only if an association could not pay off depositors. In Ohio, savers panicked when one S&L lost so much money it wiped out the entire fund.

York Ridge-Calvert, the third "We are concerned, but it is not going to affect the associations. They have ample net worth and ample earnings." -- Charles Brown, director Maryland Division of Building, Savings and Loan Maryland institution involved with BB&S, is also chartered by the state, but is insured by the Federal Savings and Loan Insurance Corp.

While the Maryland savings associations put up government securities as collateral and borrowed money from BB&S, the Army fund did the opposite. It invested $11 million cash with BB&S, which was supposed to put up $12.36 million in Treasury bonds to guarantee repayment, said Major Robert N. Mirelson, an Army spokesman.

He said the fund received a receipt showing the bonds had been deposited with Bradford Trust Co. But the bankruptcy filing listed the fund as an unsecured creditor, indicating there were no securities to back up the transaction.

"We don't know if the securities are indeed with Bradford Trust," the Army spokesman said. "We don't know if other investors have claims against the same securities."

The Central Banking and Investment Fund is a $370 million pool of Army funds raised by such non-taxpayer sources as vending machine profits, PX surpluses, and recreational equipment rentals, Mirelson explained. The money is supposed to be used for morale, welfare and recreational programs ranging from sports teams to emergency aid to soldiers and their families.

Managed by the Resource Management Directorate of the Army Community and Family Support Center in Alexandria, the fund invests its cash with several government securities dealers. Mirelson said the fund does business with 25 different government securities firms and had dealt with BB&S for seven years with no problems.

Unlike the D.C. Government -- which insisted on holding the government securities that backed up its investment -- the Army fund allowed BB&S to deposit the funds with a third party.

The Army spokesman said the Department of Defense established procedures for managing the fund. "We followed regulations and had a receipt from a known securities company," said Mirelson. "We did business under existing regulations. We cannot comment on business practices that may or may not have happened."