SAN FRANCISCO, DEC. 31 -- Bank of America today became the first major money-center bank to cut its prime lending rate, saying it will trim the benchmark for commercial and consumer loans to 9.5 percent from 10 percent as of Wednesday.

"We think it's an appropriate action to take at this time," said Jim Mitchell, a spokesman for the San Francisco-based bank.

Many of the other major banks probably will follow suit in the next few days, said banking analyst Salvatore Serrantino, president of California Research Corp. in Santa Monica, Calif.

"Everyone has been waiting for the end of the year," Serrantino said. "I think that you'll see most of the other major banks follow by the beginning of next week."

The Federal Reserve Board cut its benchmark federal funds rate by a quarter of a point to 7.25 percent Dec. 7 following a report on the same day that the nation's jobless rate for November had jumped to 5.9 percent.

Several medium-sized banks had responded to the Fed's move, the most notable being First Chicago National Bank, which lowered its prime rate to 9.5 percent on Dec. 20.

The credit-easing move on the discount rate, which banks charge each other for the short-term use of reserve funds and serves as a building block for other rates, was seen as an indication the Fed had acknowledged the nation's economy was deteriorating at a more rapid pace than previously thought.

Southwest Bank of St. Louis, frequently a leader in reducing the prime lending rate, said Dec. 7 it would cut the prime rate to 9.75 percent. Southwest's cut was matched later that day by Manufacturers & Traders Bank of Buffalo, N.Y., a unit of First Empire State Corp., and First Fidelity Bancorp of Lawrenceville, N.J., but no major banks dropped the rate.

The prime rate, offered to banks' most creditworthy commercial clients and frequently the basis for setting home equity and other consumer lending rates, has not budged since last January, when it was brought down to 10 percent from 10.5 percent.

At that point, the key federal funds rate was 8.25 percent and the Fed cut that rate three times in 1990, which means the spread -- or margin -- between that rate and the prime has widened to 2.50 percent. Banks have been slow to narrow that spread, analysts said, because their profits are so poor.

The Fed also announced earlier this month that it was relaxing reserve requirements for banks. Banks soon will start earning interest on nearly $14 billion, which they previously had to hold in reserve in their vaults as cash or place on interest-free deposit with the central bank.

At that time, the Fed made clear that in giving banks use of such funds, it hoped to boost bank profits, help rebuild capital and encourage institutions to start lending again to creditworthy customers to end a credit squeeze. Many business people say banks have been refusing loans even to good customers.