Chemical Bank, the sixth largest in the country, was indicted by a federal grand jury today on charges of failing to report more than 500 cash transactions totaling $8.5 million as required under the government's Bank Secrecy Act.

Some of the transactions, it was alleged, involved money laundering operations connected with narcotics traffic.

Two former Chemical Bank branch officers - Thomas Spinelli and Michael Strolla - were also indicted by a grand jury sitting in Manhattan on charges they failed to report each received from alleged narcotics dealers for helping to eliminate traces of more than a million dollars in cash by exchanging small bills for large ones.

A former bank vice president, Paschal Demauro, was charged with perjury to the grand jury.

A fourth person, Anthony D'Ambrosio, who is currently a fugitive from a narcotics charge, was indicted for failing to report as income $600,000 he allegedly received from heroin sales from 1970 to 1972.

The Bank Secrecy Act was passed to combat the use of banks for purposes of tax evasion, narcotics dealing or organized crime. It requires that banks report all cash transactions exceeding $10,000 - as well as the customers involved - to the Internal Revenue Service.

Robert J. Fiske, U.S. attorney for the Southern District of New York, said he believed this was the first case against a financial institution since the law went into effect in 1974.

Chemical Bank, in a statement, said it will plead not guilty to the charges, and emphasized that the indictments involve individuals "who were terminated from Chemical's employment in 1975."

The bank, with assets at the end of 1976 of $26.6 billion, said it expects "the facts will show that there was no intention on the part of responsible personnel" to evade compliance with the act.

"No senior office of Chemical was aware of this noncompliance," it said, adding that "as soon as this was brought to the attention of management, immediate steps were taken to ensure compliance, and Chemical cooperated fully with all federal authorities with regard to reconstructing all unreported cash transactions.

"Detailed regulations to bring about full compliance with the act had been issued at the direction of senior officers," the statement continued, "but there was a failure on the part of other personnel to comply with these regulations."

Chemical Bank, if convicted, faces a maximum possible fine of $500,000; the filing of false income tax returns is punishable by a maximum of three years' imprisonment and a $5,000 fine for each return; and perjury is punishable by up to five years' imprisonment and a $10,000 fine.

The individual indictments specifically charge that Spinelli, a former branch manager of Chemical, failed to report as income about $12,000 he supposedly received during 1972 and 1973 from D'Ambrosio in exchange for converting approximately $1.2 million in small denomination bills into larger bills.

Similarly, Strolla, a former assistant branch manager, was accused of failing to report $6,095 he received in 1973, which allegedly included payments for converting approximately $400,000 for D'Ambrosio and for Frank Lucas.

Lucas, according to Jeffrey I Glekel, the assistant U.S. attorney in charge of the prosecutions, is serving consecutive 40-year and 25-30-year prison terms on convictions for narcotics violations.

Demauro, the former bank vice president was charged with lying to the grand jury when he denied knowledge of the money laundering activities occurring in the Chemical Bank branches. Demauro is now employed at the Vanguard National Bank in Hempstead, N.Y.