A consensus is forming to set the increase in the capital of the World Bank at "the upper end" of the $40 billion-$80 billion range being discussed, bank president Barber B. Conable Jr.said yesterday as a three-day joint meeting of the bank and International Monetary Fund neared its end.

Conable, speaking to reporters at a press breakfast, said financial leaders favor a large increase in funding for the international agency because "most countries don't want us to come back" for more money too soon.

Bank officials have been seeking an increase in capital for two years. A major obstacle was cleared last month when Treasury Secretary James A. Baker III announced that the United States would support an increase, which Congress would have to approve.

Baker has never specified how much he believes the bank's capital should be raised, and the sum is now subject to intense negotiation among bank member countries.

Also in question is the proportion of capital that member countries would put up in cash, rather than simply pledging to provide if needed.

In view of efforts to reduce the federal budget deficit, many analysts expect the United States to propose an increase of less than the full $80 billion and to favor putting up as little cash as possible, perhaps none. Conable said the United States, too, is not anxious to repeat the process soon.

Bank capital now stands at about $86 billion. Under its charter, it cannot lend more money than it has in capital. With bank operations expanding in an effort to solve the Third World debt crisis, lending is projected to reach $17 billion to $20 billion a year in the 1990s from this"Most countries don't want us to come back" soon for more funding. -- World Bank's Barber Conable year's level of about $14 billion.

Conable said he hoped that terms of the increase could be negotiated by the end of this year. Actual payment of the increase would probably not come until September 1988, Baker has said.

In other action yesterday, Barber and Takashi Tanaka, president of the Export-Import Bank of Japan, signed an agreement under which $300 million from each bank will go in a joint program to help finance economic recovery in the Philippines.

Japan agreed at the Venice economic summit in May to recycle $20 billion of its capital to developing countries. The Japanese government is portraying its export-import bank's contribution as a payment under that promise.

The meeting, an annual exercise that brings senior bankers and finance officials to Washington from more than 150 countries, ended yesterday evening after three days of discussions dominated by debt, exchange rates, the proposed capital increase and prospects for world economic growth.

In speeches to the gathering, representatives from debtor nations pushed for radical action.

"Full payment of interest has been shown to be incompatible with sustained growth, control of public finances and price stability," said Luiz Carlos Bresser Pereira, the finance minister of Brazil, whose country suspended payments on its foreign commercial bank debt earlier this year.

Pereira said a long-term solution to the poor nations' economic problems must provide for "a direct relationship between the debt service and the effective capacity of our nations to pay." He called for cuts in interest rates and for longer maturities for existing loans.

U.S., World Bank and IMF officials, however, generally argued for staying the course, suggesting that Third World debtor nations be granted new loans in exchange for growth-oriented economic reforms.

The officials also criticized commercial banks for not making more Third World loans.

In a speech Wednesday, Baker elaborated on new financing instruments that he said could help ease the pressure.

One he had not officially proposed before was so-called interest capitalization, allowing countries to add overdue interest to the principal of their loans.

Baker approached the subject with extreme caution, saying that route might be opened only on a voluntary basis for certain countries, particularly small debtors.

Bankers are likely to be wary of it, as many believe it would undermine the fundamental assumptions of the lending business and set a dangerous precedent of principals growing year after year and interest never being paid.