Offers came from Mellon Bank Corp., Compass Bancshares, and Whitney Holding Corp.

But stubborn Horizon Bank of Florida, a $59 million family-owned bank in Pensacola, turned them down flat. John W. Nobles, an owner and senior vice president, said he and his family members are not ready to part with tradition-even for more than two times book value.

"We all work there, so it's part of the family," Mr. Nobles said. "It would not be something that would be easy for us to do."

Across the country, family-owned banks are wrestling with the question of whether to sell. Nearly 40% of all community banks are owned by families, and for them, selling involves much more than deciding on the right price.

A sale could end a banking dynasty, closing the door on a way of life started by a father, grandfather, or great-grandfather. It could erase a familiar name from a building in the center of town, dampening local pride. It could even prompt family feuds.

For instance, Mr. Nobles said selling the bank would mean getting his mother, father, two brothers, and sister to agree on a deal.

"Our family is really a close-knit family," he said. "It would have to be a unanimous decision to sell."

Mr. Nobles' situation would ring familiar to the 20 community bankers- most of them owners of family-run banks-who converged at an Independent Bankers Association of America seminar in Bermuda last month.

The small-town bankers were trying to figure out how to proceed in the era of sweeping consolidation, and three basic options were presented: open more branches, buy another bank, or sell yourself to someone else.

Though the seminar included advice on selling the bank, several participants said giving up the family business was not an option for them.

These bankers said they were chiefly concerned with figuring out who would run the bank when they retired or died. In the meantime, they were working to keep their institutions strong through growth-not always an easy proposition.

"In our market, one of the problems is there are virtually no banks to acquire," said W.S. Stuckey Jr., chairman and an owner of $80 million Citizens Corp. of Eastman, Ga. "We would love to buy some. We're trying to figure out what to do."

Greg Martinson, IBAA's director of education, said his trade group wants to help banks like Citizens stay alive and independent, but there are several common problems. One is finding a geographically compatible merger partner; another is increasing deposits in towns with few newcomers.

"How does a family bank in rural America survive when the population is stagnant?" Mr. Martinson said. "That's the battle they have to fight."

Even when a family concludes it should buy another bank, the transaction can be tricky. Family members are often forced to pay cash for acquisitions because their stock is not liquid. Or they may choose to pay cash to avoid diluting their control, said Anita Gentle Newcomb, managing director of Bank Professional Services in Washington.

Ms. Gentle Newcomb recommends that banks consider buying branches, because the deals are done in cash and are less expensive than buying entire institutions.

That strategy is working for some small banks. Faced with a meager 5% growth rate, Jim N. Birdwell, president of Jackson Bank and Trust, Gainesboro, Tenn., decided his bank couldn't make it with just one branch in a county of 9,500 people. Two years ago, he branched into a nearby county; now the bank is seeing annual earnings growth of 18% to 20%.

The expansion will enable Mr. Birdwell to pass a viable company down to his 20-year-old son, who has expressed interest in carrying it on.

"He wants to hold the family tradition," Mr. Birdwell said.

Some bankers are not so lucky. Adrian C. Golberg, president and CEO of $37 million-asset United Southwest Bank, Cottonwood, Minn., has been trying fruitlessly to buy a bank or branch. He recently lost a bidding contest for two regional bank branches.

The branches went for twice what he bid.

Mr. Golberg has invested 30 years of his life in United Southwest, and wants to preside as long as he is healthy. The only way he would sell the bank, he said, is if he can't persuade his grown children to take it over.

"It's awfully hard to get them to come back to the town they came from," Mr. Golberg said, but "I'd rather keep it in the family."

William P. Johnson, a partner in the Denver-based law firm of Rothgerber, Appel, Powers & Johnson, said that when family-owned banks are sold, it is often because the owner didn't plan for the future. Sometimes the children do not want to step into the executive suite, he said, or sometimes heirs must sell the bank to pay estate taxes.

Bankers are "less likely to sell if there are successors," Mr. Johnson said. "Sometimes, only the parents want the kids to work in the bank. That doesn't work worth a damn."

An American Bankers Association/ABA Journal survey of 1,500 community banks found that 38% of community banks were family-owned. The ABA said the survey sample was representative of the industry.

The survey also found that 36% of community banks have not designated a successor for their top officer. Four-fifths of those banks said they hope to find a successor, and almost a tenth said they expected to sell. The rest did not explain why they had no succession plan.

Bankers sometimes find the pull of the family business stronger than they had expected.

Theodore L. Starr, president of Citizens State Bank and Trust, Hiawatha, Kan., did not start out at his family's bank. His father urged him to seek his own career. He then made his fortune as a lawyer and trust officer at another Kansas bank.

Mr. Starr came back to the family bank seven years after his 50-year-old father, Wayne R. Starr, died in a plane crash in 1972.

The senior Starr had not planned on his son running the bank. In fact, he never created a succession plan.

"Dad was the type of guy who thought he would live forever and do it all until they carried him out of here on a stretcher," Mr. Starr said in a telephone interview.

Carrying on his own family tradition, Mr. Starr has told his teenage daughters to seek careers outside the bank-and perhaps join the bank once they are established.

Like other community bankers, Mr. Starr has been searching for acquisition targets and found them too pricey. Attracting new deposits in a town of 4,500 is getting harder, but the thought of selling the bank is anathema.

"It's been our lives," Mr. Starr said.

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