WASHINGTON - Fourteen national banks are getting a jump on interstate branching - action generally barred by law until 1997.

A loophole lets national banks to move their headquarters 30 miles or less, enter a new state, and operate the original bank as a branch.

NationsBank Corp. and First Fidelity Bancorp. - the two most ambitious patrons of the Comptroller of the Currency's 30-mile rule - have moved their headquarters three times each, covering a combined 346 miles.

These two banks and 12 others have used the loophole to create the first multistate banks operating under a single charter - something most commercial banks won't be able to do until the interstate banking bill takes effect in June 1997.

Eight other banks have applications pending.

The comptroller has used this branching loophole aggressively, even over the vehement objections of some states.

Just this week the OCC allowed Bank Midwest of Kansas to move its main office from Lenexa, Kan., to Kansas City, Mo., and consolidate its operations in Missouri.

In its approval, the OCC rejected the adamant complaints of the Kansas governor and bank regulator. The agency said the state's restrictions on out-of-state banks owning branches are preempted by federal law and violate the Constitution's commerce clause.

Community banks and state regulators have complained the that Comptroller is jumping the gun on the 1997 start date of provisions in the interstate branching law passed last year. But Julie L. Williams, the OCC's chief counsel, said, "We are not jumping the gun at all - we are acting under the law that Congress left intact."

"Our authority to act in this area is clear, it is longstanding, and Congress explicitly recognized that in the interstate legislation," she said.

"Congress envisioned that we would continue to act for a three-year period" on applications under the 30-mile rule until the interstate law fully takes effect, Ms. Williams said.

In January 1994, First Fidelity was the first bank to get the nod under OCC's 30-mile rule, moving its Philadelphia-based bank to Salem, N.J. First Fidelity also moved its New York bank into New Jersey and then leapfrogged into Maryland. The $33.4 billion-asset bank, which operates 645 offices in four states, is now officially based in Elkton, Md., a town of 6,468 people.

NationsBank, the $170 billion-asset giant, was right on First Fidelity's heels. In February 1994, the comptroller allowed NationsBank to use the 30- mile rule to move the headquarters of a subsidiary, American Security Bank, from Washington to a Maryland suburb.

After a series of acquisitions, 30-mile moves, and mergers, NationsBank wound up with a Maryland-based bank with branches in Washington and a single Charlotte, N.C.-based bank with offices in North Carolina and South Carolina.

In addition, the Maryland NationsBank is soon expected to win permission to move into Virginia. The result will be a Richmond, Va.-based bank with offices in Maryland and the District of Columbia.

Officials at both banks say they pursued the moves to make banking more convenient for their customers. For example, a NationsBank customer working in Maryland but living in Virginia can deposit a paycheck at a branch in either state. The banks also expect some modest cost savings - a few million dollars annually.

Wall Street sees the savings as mild, but applauds the moves. "It is not often that you can do something to serve your customers and actually save money while you're doing it," said Moshe Orenbuch, a research analyst at Sanford C. Bernstein & Co. who follows both NationsBank and First Fidelity.

In strict financial terms, "it is hard to get excited and jump up and down" about the savings achieved by combining the banks, he said. Indeed, since just 14 banks have so far used the 30-mile rule, "some of them are clearly saying that it is not that big a deal." But, Mr. Orenbuch said, "over and above the explicit costs there's a hidden cost" to having separate subsidiaries in each state.

H. Rodgin Cohen, a partner at the New York law firm Sullivan & Cromwell, agrees that banks that have used the 30-mile rule "are able to cut costs in a number of ways."

By combining subsidiaries' operations, banks shave expenses with a single set of directors, one audit, and one regulatory exam. They also can often combine advertising efforts and condense management structures, he said.

The comptroller's chief counsel, said banks' attitudes towards the loophole vary.

"Certain banks really do seem to be convinced that there are substantial synergies to combining" their separate bank subsidiaries, Ms. Williams said. "Other banks seem to feel that their style and their success is more oriented to having a separate charter approach."

But the 30-mile moves also have had a broader impact.

"What spurred, to some extent, the congressional action on interstate (branching) was the determination by OCC to allow applications to go ahead," Ms. Williams said.

Mr. Cohen said it also has helped banks hold customers.

"Customers like the convenience of having the same bank, no matter where they live in a metropolitan area," he said.

Besides NationsBank's move to Virginia, PNC Bank/Northern Kentucky N.A., has applied to move from Fort Mitchell, Ky., to Cincinnati.

American National Bank and Trust Co. has applied to move from Genoa City, Is., to Libertyville, Ill., while Industrial Bank of Washington is trying to move from Washington to Oxon Hill, Md.

Commercial National Bank is seeking the OCC's permission to move from Texarkana, Ark., to Texarkana, Texas. Country Club Bank hopes to move from Kansas City, Mo., to Prairie Village, Kan. Twin River National Bank wants to move from Lewiston, Idaho, to Clarkston, Wash. And Belmont National Bank, in St. Clairsville, Ohio, has applied to move to Wheeling, W.Va.

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