In cities across America, superregionals are breathing down the necks of community banks. Yet nowhere else is the difference between the big and the small more glaring than in Phoenix.

This southwestern metropolis, with more than a million residents and four major sports franchises, is one of the fastest growing cities in the nation.

But it has just three hometown banks, the biggest of which has assets of only $43 million and one branch. Four big banks - Banc One, Norwest, Wells Fargo, and BankAmerica - control 90% of Phoenix's banking market, with a handful of smaller banks owned by out-of-state holding companies handling the rest.

Phoenix's three small independents control less than 2% of the market.

Is this a glimpse of the future?

"Phoenix will be the prototype for the rest of the country," said Thomas J. Euen, chief executive of Republic National Bank, the largest Phoenix independent bank. "I think you'll find small banks serving the small communities, mostly. They'll only be able to serve the large communities if they're focused."

Stephen D. Todd, president of First National Bank of Arizona, agreed. "I just don't see the community bank market coming back like it did in Southern California," said the executive, whose bank is a subsidiary of Bancorp Hawaii.

"The four big banks control 90% of the market. How can you carve anything new out of the remaining 10%? I think what you'll see nationally is a few big banks and a few small banks, without much left in the middle," Mr. Todd added.

Said Jack Wertheim, CEO at Valley Bank of Arizona, one of the snall independents: "Chances are if a middle-sized bank has some market presence, it'll become a takeover target."

But Thomas C. Lathrop, chief executive of M&I Thunderbird Bank, a subsidiary of Marshall & Ilsley Corp., Milwaukee, doesn't think Phoenix is an accurate example of the nation's banking future.

He said there were two unusual factors that influenced the Phoenix market: the bank and thrift failures of the past decade and the dominance of the city, the state's commerce center.

Mr. Lathrop said Phoenix could prove a testing ground for superregionals.

"I think what you might see is the bigger banks trying out things in Phoenix before taking them elsewhere," he said.

Mr. Todd said the small and midsize banks will have to concentrate on niche banking if they want to stay alive here. First National Bank of Arizona is a basically a loan office for Bancorp Hawaii's biggest subsidiary, Bank of Hawaii. The handful of independents in the state also concentrate on target markets.

Republic National, for example, is a powerhouse in Small Business Administration lending. Last year, it made 63 SBA loans, with more than $13 million in volume. Within Arizona, that was the third highest total - traling only Money Store and National Bank of Arizona, a unit of Salt Lake City-based Zions Bancorp. That's not bad, considering Republic National got its SBA program up and running less than five years ago.

In addition to SBA lending, Republic National has a statewide rural economic community development program. It recently announced a venture with the Industrial Development Authority of the County of Maricopa to establish an export and technology sideline for accounts-receivable financing for technology and export sales.

Republic National doesn't rely on a plethora of small loans to boost its SBA standing. In 1994, for example, Republic National handled the largest SBA loan in the Valley area and four of the top 25.

The SBA recently upgraded Republic National to Preferred Lender status, and the bank's growth in such lending has caused a personnel quandary.

"The real problem we've had is training people," Mr. Homenick said. "It's a very specialized niche, and we have to grow our own in terms of expertise."

The bank's niche has been carved out of a rich vein. Only 1.2% of Arizona's SBA-guaranteed loans defaulted last year, compared with 3.3% nationwide. That SBA success is evident on the bank's bottom line: For 1995, the bank registered net income of more than $540,000 for a 1.15% return on assets.

In recent months, start-ups Valley Bank of Arizona and Valley Commerce Bank have joined the fray in Phoenix, but Republic National's emphasis on business banking helps it stand apart from the newcomers and established banks run by out-of-staters.

"We're trying to offer a full plate that covers the small-business market," Mr. Euen said. "We're always looking for targets that the big banks miss. We think we've built a pretty good base with small-business customers."

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