Investors are battering the share prices of active and potential bank acquirers this quarter.

In the past two months, the shares of banks that have done sizable transactions this year are off an average of 1.9%, according to Fox-Pitt Kelton, an investment banking firm.

Shares of banks perceived as likely buyers are down an average of 1.6% in the two months.

Others Gain

In contrast, less likely acquirers and less plausible acquisition candidates are up 6% in the past two months. Fox-Pitt Kelton said.

The firm said merger activity has picked up since June 36, causing investors to focus on the potential dilution to a buyer's earnings per share as a result of acquisitions

"Clearly, the differential in a lot of cases is due to concerns about carnings-per-share dilution from acquisitions or potential dilution from acquisition strategies," said Michael Granger of Fox-Pitt Kelton.

In many mergers. the acquiring bank announces the deal will either generate no dilution or will be barely dilutive for a year.

But analysts and investors often doubt an acquiring bank's ability to minimize dilution through expense reduction and revenue gains.

Moreover, some analysts and investors ignore the stated dilution of a deal to focus on return on investment. This camp argues that a bank can finesse the terms of a deal to avoid dilution, sometimes through the use of one-time charges.

Big Deals

But a nondilutive deal does not necessarily provide a sufficient return on investment, some analysts said.

Some of the banks with the worst-performing share prices this quarter have done the biggest deals, in which the potential for dilution is greatest.

Bank of New York Co.'s shares are down about 10.5% this quarter. The bank has agreed to acquire National Community Banks Inc.. West Paterson, N.J., for $652 million in stock. The value of the deal represents about 20% of Bank of New York's current common equity.

That fall in Bank of New York's stock price is not due solely to the National Community deal, Mr. Granger said. Bank of New York is rumored to be scouting other New Jersey transactions.

Another Victim

Banc One Corp.'s stock has suffered, too. The bank has announced five acquisitions this year, worth $863 million, or 15% of common equity. And the shares have fallen about 7% in the first two months of the quarter, Fox-Pitt Kelton said.

The recent nosedive has wiped out the gains the shares made earlier this year. On the year, the stock is down 1.6%.

Two big past acquirers that have been quiet this year are Society Corp. and Keycorp. Since June 30, shares of both companies have plunged 9.3%.

"I think that has to do with the concern about them doing a deal," said Mr. Granger.

Hamstrung Shares

Concerns about dilution have hampered some bank stocks all year. In 1993, shares of banks that have not done sizable mergers are up 16% on average. Shares of banks that have done sizable transactions are up on average 6.2%. Banks that are perceived as potential acquirers, based on their histories and strategies, are up only 2% this year.

lnvestors view this last group as risky because they fear the banks may do a dilutive deal.

On occasion, a bank stock will rebound after a deal is annnounced.

Take the case of CoreStates Financial Corp., a Philadelphia bank which recently agreed to acquire Constellation Bancorp, Elizabeth. N.J.

In the weeks before the merger anouncement, CoreStates' shares were trading around $59. But rumors of a deal pulled the shares down to $57.50 just before the announcement. When the news came out, the shares eventually fell to $53.50. The shares have floated back up to $58.25.

"Investors can wait for the stock to fall after an acquirer does a deal and pick it up at a lower value." said Denis Laplante, an analyst with Fox-pitt Kelton.

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