Bankers' Bank of Wisconsin wants to acquire a bank charter in Iowa next year to grab more market share in the Hawkeye State.

"We believe Iowa bankers want to do business with Iowa bankers," said Helge S. Christensen, president of Bankers' Bank of Wisconsin.

Bankers' Bank of Wisconsin's interest in Iowa is a sign of growing competition among the nation's 17 bankers' banks, correspondent banks that offer services such as loan participation and check clearing. The bankers' banks are bumping into one another as they vie for customers in several states that lack homegrown bankers' banks.

But Bankers' Bank of Wisconsin is the first to consider getting a charter in another state.

Other bankers' banks are simply marketing across state lines, said Ray B. Cavedo Jr., chairman of the Bankers' Bank Council, a trade group for all 17 bankers' banks.

That's the case in Maryland, which lacks a bankers' bank. Atlantic Central Bankers' Bank, Camp Hill, Pa., and Community Bankers' Bank, Richmond, Va., are each marketing their services to community banks in Maryland. Both have also dropped their home state name from the bank name in recent years to make regional marketing easier, said Mr. Cavedo, who is president of Community Bankers' Bank.

Iowa-with 450 community banks and no homegrown bankers' bank-is considered fair game. Bankers' banks from Illinois, Minnesota, Missouri, and Wisconsin each has Iowa community bank clients.

"Iowa has always had the potential based on the number of banks," said William C. Rosacker, president and chief executive officer of United Bankers' Bank, Bloomington, Minn. "That's the bread and butter of the bankers' bank."

Moreover, many of Iowa's traditional community bank correspondents- larger community banks with $1 billion to $3 billion of assets-have been acquired by national or superregional banks.

For example, Davenport Bank and Trust was a correspondent for many banks in eastern Iowa, but when it was acquired by Norwest Corp. in 1993, its correspondent services ceased.

In addition to having fewer correspondents to chose from, many community banks are finding they need more help covering loans.

"We've seen loan participation up to record levels" in the Midwest, said John D. Schneider Jr., president and CEO of Independent Bankers' Bank, Springfield, Ill. "Either the loan-to-deposit ratio has reached the maximum, or the loan size has exceeded the bank's legal limit."

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