[TEXT OMITTED FROM SOURCE] Federal regulators said yesterday that expiration of the measure, known as the Garn-St. Germain emergency acquisition act, has stripped them of important powers to cope with failed banks and savings and loans, including the ability to seek offers for failed institutions from a wide range of healthy, out-of-state buyers seeking to sell banking services across state lines.

The Garn-St Germain bill, passed in 1982, included interim, emergency legislation to give bank regulators greater power to deal with failed banks and S&Ls while Congress worked out a comprehensive banking law.

But an impasse between Senate Banking Committee Chairman Jake Garn (R-Utah) and House Banking Committee Chairman Fernand St Germain (D-R.I.) has stalled all major banking bills in Congress since. By default, the emergency portions of the Garn-St Germain measure have become an increasingly important tool to regulators facing a rising number of failed banks and S&Ls, many of them associated with failing oil and real estate prices.

Regulators say that swift resolution of problem bank cases is critical to protecting depositor confidence and to minimizing government cost.

Also important in reducing the government's cost is getting as many healthy bidders as possible to make offers-especially from institutions eager to take on a sick bank or S&L in exchange for the right to enter a new banking market.

Banking giants such as Pennsylvania's Mellon Bank Corp. and New York's Chase Manhattan Corp., for example, gained early entry into Maryland by taking sick S&Ls off the government's hands.

And Citicorp is fighting to gain entry into D.C. by buying a failing S&L, National Permanent Bank. Without the Garn-St Germain emergency bill, Citicorp's efforts to complete the deal could be stalled, regulators said.