New Mexicans are loyal to their community banks.

Though out-of-state banks have staked out widespread territory there, the state's 80 community banks are thriving. Witness the arrival of BankAmerica Corp., which picked up two failed Albuquerque thrifts with combined assets of $1.872 billion from the Resolution Trust Corp. in March 1991.

Although it is common for a bank buying failed thrifts to lose some deposits, Bank America's deposits at the two thrifts declined a whopping 60%, to only $749 million at the end of the first quarter of 1993.

To avoid a similar fate, St. Louis-based Boatmen's Bancshares broke with tradition following last year's acquisition of Sunwest Financial Services. Instead of putting up Boatmen's signs, the company preserved the Sunwest name.

Profiting from Runoffs

"I don't think the population in general likes the big-time banking operations," says Dick Bailie, senior vice president of Ranchers State Bank of Belen.

Ranchers has grown its assets by 58% in the past three years, to $73 million, largely due to runoff from BankAmerica branches in four common markets. That compares with 16% growth for all U.S. community banks, according to data supplied by W.C. Ferguson & Co., Irving, Tex.

Outside banks are attracted by New Mexico's strong economy. In addition to incursions by BankAmerica and Boatmen's, First National Bank in Albuquerque recently agreed to be acquired by Salt Lake City-based First Security Corp.

Problem Loans Above National Average

Still, New Mexico community banks are not trouble free. As of March 31, problem loans represented 3.63% of gross loans, higher than the average of 3.38% for all U.S. community banks.

That kept returns on average assets for the state's banks at 1.15%, compared to 1.26% for all U.S community banks.

However, the state's agricultural bankers are expecting stronger returns in 1993, as cattle prices have buoyed earnings for livestock producers.

"Generally speaking the economic climate is fairly good throughout New Mexico," said Kent Carruthers, CEO at the Citizens Bank of Clovis.

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