The new Ciao - that is, the Ciao with a new manager and a chef direct from Nicholini's - is a different story. For the past three months, people have been telling me a different story . . . that it's worth a visit, that the food's excellent, not terriblyexpensive, and actually fun.

The ''fun'' part didn't quite match up to expectations on the Saturday evening I treated some friends to a farewell dinner at the restaurant. At 8.30, the smallish room was practically deserted save for one table. This meant that manager Antonio Ho couldserve us himself.

He was all charm. Apologetic when ingredients weren't available, happy when we said we liked certain dishes, ready to improve if we came again.

With a few exceptions, our meal was ''comfortable'' Italian. The sauces were light and tasty, the pastas were obviously made a few minutes before (not a single dish seemed micro-waved), and we couldn't really complain.

Not that Ciao doesn't need improving. An opening dish of mozzarella caprese didn't have a sliver of basil (apparently the kitchen lacked fresh basil though ground basil would have been perfectly acceptable), and the tomatoes were hardly ripe.

But my own starter, the crespelle al formaggio was a light, crispy crepe with a tangy combination of cheeses inside. The third appetiser was a risotto with a lot of mushrooms, and very tasty.

We shared the air-dried beef that, with some heavy vinegar, was quite delicious.

Chef Alan Tse, who has worked with Italian food for 13 years, the last as assistant chef at Nicholini's, obviously takes pride in his main courses. One example is the osso bucco made Milanese style, with Milanese-style rice. The rice had bits of saffron and meat, while the veal was tender, flecking straight off the bone. This hardly looked as wonderful as the round chunks of osso bucco in Italy, resembling more a stew. But it was certainly tasty enough.

I went easy with an eggplant parmesan. This is hardly in the osso bucco class. Where the latter is in a class of its own, eggplant always smacks of Alexandre Dumas's comments: ''No good chef ever uses eggplant, because the simplest peasant can make a gooddish from this common vegetable.'' Common it may be, but Ciao made it quite luscious, pouring on both the parmesan and mozzarella cheese. It was served lukewarm - which is the best way to enjoy the oozing cheese.

The desserts were a bit disappointing. The gelati was a simple dish of three ice-creams. The ultra-sweet sabayon had a hint of Marsala wine.

With two bottles of wine, three of us dined well for just over $1,000. Ciao has made vast improvements since its first incarnation, but it remains a bit boring. Though we could well remember the fine crepes, the veal and the eggplant, there were errors, to be sure, but only a mediocre chef is consistent. And Mr Tse is anything but average.