WASHINGTON -- On a good day, five customers might walk into Metropolitan Bank for Savings' main branch. But its executives are thrilled, and the thrift is thriving.

For each of the past five years, Metropolitan has made only a handful of home loans in its suburban Virginia community. But it has developed a vast national network of customers, and has grown from $50 million to $356 million in assets.

Until 1989, when it changed owners, Metropolitan "had been run as a small little sleepy thrift," said its president, Mitchell H. Caplan. But since then, the Arlington-based institution has been riding on the thrift industry's new frontier: It has been transformed into a telephone bank, serving customers through telephone lines rather than teller lines.

Thrifts used to be simpler. They took deposits and made home loans. But now that savings and loans have dug out from the crisis of the '80s, they have remade themselves into institutions targeting new areas of consumer lending, insurance, and mutual funds.

"The successful thrift of the future will have to offer that wide range" of products to their customers, said James F. Montgomery, chairman and chief executive officer of Chatsworth, Calif.-based Great Western Bank. "That's the way the world is."

After losing hundreds of institutions to the thrift crisis, the industry has stabilized at roughly 2,200 institutions nationwide, almost all of which have healthy capital levels. For more and more thrifts, experts say, the future lies in one of two strategies. Thrifts must either offer a broad menu of products and services, like the large commercial banks, or seek out a specialty, which may have nothing to do with home loans.

Bert Ely, an Alexandria, Va.-based banking consultant, said, "Ten years from now, there are still going to be some institutions around that call themselves savings and loans." But, he said, "we are seeing not only a metamorphosis but also a disappearance" of thrifts as part of an identifiable industry.

Take Metropolitan.

It attracts savers nationwide by paying premium interest rates on certificates of deposits and money market funds. "We view ourselves as a direct marketer of bank products," said Mr. Caplan. Metropolitan uses depositors' money to buy whole loans and mortgage-backed securities.

"We view ourselves, first of all, as a true branchless banking operation," he said. "We are a telebank thrift."

California's $40 billion-asset Great Western Bank is also moving away from the traditional thrift model. Its assets are like those of a typical thrift, but its liabilities are not. It now aggressively markets its checking accounts and its giant mutual fund operations instead of concentrating on CDs.

Some thrifts in the heartland have also moved away from traditional business lines.

Harry J. Bailey, president of New Castle, Ind.-based Ameriana Bancorp, has blazed a trail in the insurance industry with his thrift, $275 million-asset Ameriana Savings Bank.

While Ameriana Savings makes plenty of home and car loans and offers credit cards, checking accounts, and certificates of deposit, it also owns Family Financial Life Insurance Co., which provides mortgage life and credit life insurance and annuities.

Ameriana also owns Ameriana Insurance, an insurance agency that sells property and casualty insurance as well as term and whole life. And Ameriana owns a full-service brokerage. "About 10% of our income comes from the fees generated by those companies," Mr. Bailey said.

"I'm not sure that by the end of the century there will be any traditional thrifts left," Mr. Bailey said.

The thrift trade group agrees that the industry is no longer monolithic. Many institutions are developing new niche markets.

"Most of our guys have realized that their assets are their customers," said Brian P. Smith, policy director of the Savings and Community Bankers of America.

The model for thrifts of the future "is going to be: take deposits and do whatever your customers want," he said. "The question of the asset-side deployment -- that's where the changes have occurred."

Some more traditional thrifts are betting on underbanked markets.

William L. Young, president and CEO of $13 million-asset Metro Savings Bank in Orlando, said that while Metro mostly makes home loans, it also offers personal and business checking accounts, passbook savings accounts, credit cards, some business and commercial loans, and CDs.

"Metro Savings is located in the heart of the minority community" in Orlando's inner city, Mr. Young said. Metro focuses solely on that neighborhood. "We've seen an increase in stability," since the thrift was founded 30 years ago by an African-American doctor who couldn't get a home loan, he said. "The demand certainly is here for an institution of our size."

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