The D.C. Bankers Association, in an attempt to discredit a recent study that alleges discriminatory mortgage lending practices in the area, has produced a critique that purports to show that questionable methods were used to complete the study.

What's more, the DCBA says its critique, which was prepared by the Urban Institute, shows that most of the conclusions in the controversial study by the Woodstock Institute of Chicago are erroneous.

The DCBA's challenge fails, nevertheless, to address the major issue that prompted the Woodstock study in the first place: A pattern of residential lending shows a disparity among neighborhoods in the District, and between the District and the suburbs.

The Woodstock study, which was prepared for the Metropolitan Washington Planning and Housing Association, concluded that a pattern of residential lending decisions "benefited suburban areas to the detriment" of the District. Those decisions also "benefited some white neighborhoods" in the District "to the detriment of predominantly minority neighborhoods," the institute said.

The DCBA and executives of individual lending institutions here immediately rebutted the charges when the Woodstock study was released earlier this month. In the interim, however, D.C. Councilmember Charlene Drew Jarvis asked the DCBA to submit a formal response to the Woodstock findings. Jarvis chairs the City Council's committee on housing and economic development, which is holding hearings on an interstate banking bill. Investment and lending policies of D.C. banks and out-of-state banks that may be affected by a reciprocal interstate banking bill are crucial to those hearings.

Jarvis' reaction after reading the Urban Institute's critique of the Woodstock study is instructive. "I think the critique is an overintellectualization of the Woodstock Institute's findings. It looks like a statistical response which fails to address the overriding concern of the Woodstock report, which is a perception" of discrimination in mortgage lending, Jarvis said.

Maurice Cullinane, executive vice president of the DCBA, insists, nevertheless, that the Woodstock Institute's report is "a very, very poor study. I think that study was meant to dazzle."

The Urban Institute not only questions the study's findings in its critique, but asserts that the results "are not interpreted in accordance with good statistical practice."

When the Woodstock study analyzes the number and dollar volume of housing loans made, for example, it uses "a rough and inaccurate estimate" of the number of units eligible for loans, according to the Urban Institute. The critique, which the Urban Institute says presents "a more appropriate analysis" of mortgage lending in the District, shows that the city is receiving its "fair share" of financing for single-family housing, the Urban Institute continued.

The District's so-called fair share was calculated for purposes of the critique by studying the 1980 Census of Housing, which showed that there were 117,838 single-family units in the city, or 16.5 percent of the 714,149 units in the Washington Standard Metropolitan Statistical Area. In 1982, according to the critique, the District received 17 percent of the loans in the SMSA and 20.5 percent of the value-adjusted loan dollars.

District bankers are proud of the way they serve the city's need for single-family loans, Cullinane said in a letter to Jarvis last week. The way lenders serve that need is precisely the issue that was raised in the Woodstock Institute's study. But neither the DCBA nor the Urban Institute in its critique has satisfactorily addressed the issue.

In the meantime, the perception of disparity in lending practices does exist and has for a long time. Bankers and other lenders in the area have been unsuccessful in dispelling that notion, which has been reinforced by the Woodstock study. The DCBA isn't likely to change many minds by offering a a set of weighty statistical arguments to attack the methodology of the Woodstock study.

The president of the nonprofit Woodstock Institute defends the report, declaring, "I'm confident with what we found." The report's author "conducted a statistically sound study of lending" in metropolitan Washington, said Elspeth Revere. "We didn't have a bone to pick or an ax to grind when we did the study."

Even though the Woodstock Institute failed to produce affidavits supporting claims of discrimination against residents of certain neighborhoods, it has identified a pattern that raises questions. Statistical jargon isn't likely to change many minds in the community. On the other hand, candid statements -- in laymen's terms -- explaining why those patterns exist, and what can be done to change them, may be lenders' best form of rebuttal.