BANKING

Andersen Disciplined for S&L; Flop: Arthur Andersen & Co. was ordered to pay $1.7 million, perform 10,000 hours of community service and train its auditing staff better after settling charges that the giant accounting firm was grossly negligent in its audit of Lincoln Savings & Loan Assn., the California Board of Accountancy said. Lincoln failed in April, 1989, at what federal officials said at the time was a cost to taxpayers of $2.6 billion. Large sums of money were looted from the institution by its owner, Charles H. Keating Jr. The settlement ends a longstanding legal battle between Andersen and the state board. The accounting firm admitted no wrongdoing in agreeing to the settlement.