When developer Lincoln Property Co. went looking for a loan in 2007 to finance a commercial real-estate project in Phoenix, the Dallas company knew its bankers would be tough.

So Lincoln lined up a private-equity investor to buy a 50% stake in the deal, limiting the bank's exposure if the loan went bad. "We would not do it without equity," says C. Frederick Ball Jr., chairman and chief executive of Dallas-based Bank of Texas, a unit of BOK Financial Corp., of Tulsa, Okla.

In the 1980s and 1990s, more than 800 banks and thrifts in Texas went bust, doomed by the oil and real-estate bust and foolish lending. But with the U.S. banking industry now suffering through its worst mess since then, Texas banks have been surprisingly resilient so far.

Out of 28 banks and S&Ls to fail since the start of 2007, just two were based in Texas. Their combined deposits were just 2% of those at Washington Mutual Inc. when its banking operations were seized in September and sold to J.P. Morgan Chase & Co.

Problem loans are piling up at a slower rate at Texas banks than the industry overall, according to the Federal Deposit Insurance Corp. Meanwhile, about 7% of banks in the state are considered problem institutions by the Texas Department of Banking. That is down from 50% during the 1980s.

Some analysts and bankers say more trouble is around the corner, pointing to last year's 54% plunge in oil prices and declining housing prices. "I hate to think that history will repeat itself in Texas," says Terry J. McEvoy, an Oppenheimer & Co. analyst. The state's economy "is about one year behind" the rest of the U.S., he says, portending more pressure for Texas banks.

Some longtime Texas bankers say the fact they have largely avoided making disastrous headlines lately reflects memories of when Texas led the nation in bank and thrift failures. Back then, bankers "never really looked at the total indebtedness of the customer they were lending money to," says David Zalman, chairman and CEO of Prosperity Bancshares Inc., of Houston.

In November, Prosperity inherited all the deposit accounts of Franklin Bank, a Houston bank once led by mortgage-bond pioneer Lewis Ranieri. Franklin failed in November.

Texas lenders now generally require more collateral on big loans, while far fewer real-estate projects are excessively valued. The once-common practice of banks and S&L institutions taking stakes in real-estate projects they financed now is illegal, says Joseph Grant, chairman emeritus of Texas Capital Bancshares Inc. and author of a book titled "The Great Texas Banking Crash: An Insider's Account."

Some young bankers have challenged the toughened underwriting, wondering why their bosses didn't make more loans when the U.S. economy was booming. "If you didn't go through [the last crisis], you don't understand it," says F. Scott Dueser, chairman and CEO of First Financial Bankshares Inc., based in Abilene.

"Compared to the 1980s, nobody is the same," says Brad Milsaps, an analyst with Sandler O'Neill & Partners LP. But how many Texas banks can largely steer clear of what is expected to be another rocky year for the banking industry is a big question.

"The talk from Texas bankers is more conservative," he says. "We don't know yet."

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