After losing the interstate branching battle in Washington, community bankers are mounting a state-by-state offensive to gut the new law.

Community bank trade groups in 10 states appear poised to fight the law at the state level. And groups in two states -- Colorado and Texas -- already have vowed fights.

Meanwhile, the Independent Bankers Association of America is nurturing the efforts as the state groups gear up for winter legislative sessions.

To win, the community bankers will have to convince state legislators to pass "opt-out" laws that will prohibit national banks within the state to take advantage of the federal interstate branching law.

"This fight is going to be about political influence," said Ron Ence, senior legislative counsel at the IBAA.

"Financial contributions from big banks are going to play a heavy role," he added. "We don't have those kinds of deep pockets. We'll have to use our intellect and our wits to compete with [NationsBank Corp. chairman and chief executive] Hugh McColl's deep pockets."

Community bankers are opposing the measure because, they argue, in some states it would create inequities in regulatory burden within communities. In addition, community bankers are fearful of concentration and the ability of a branch of a large bank to set market rates on banking products in small towns.

With the help of the Conference of State Bank Supervisors, the IBAA is working on a model opt-out law that state legislatures could pass and advising local trade groups on what issues, from taxes to state-national parity, could be used to drumup grass roots support.

Already, the national trade group has gotten a firm commitment from Texas, where the Independent Bankers Association of Texas vowed last week to push for an opt-out law. The stakes are highest in the Lone Star State, with its size and its preponderance of big, out-of-state-owned banks.

Independent banks in Colorado, where the biggest banks are owned by out-of-state holding companies, formally have decided to fight for an opt-out law, said James P. Thomas, executive manager of the Independent Bankers of Colorado.

"The consensus is that we will try to opt out," said Jerry Sage, executive director of the Missouri Independent Bankers Association. "We're examining the issue now, and we'd like to have a consensus with other banking groups before taking a formal position and go from there."

Other states that appear poised to join the trend are Kansas, Nebraska, Iowa, Oklahoma, Minnesota, Florida, Louisiana, Montana and Wyoming.

The IBAA is using the Conference of State Bank Supervisors as a resource and has met with the state regulatory group on several occasions, Mr. Ence said. Ellen Lamb, spokeswoman for the CSBS, said the association won't take a position for or against opting out. It is in the early stages, however, of developing opt-out laws that state's could use.

The interstate branching law, signed by President Clinton last week, allows national banks to branch across state lines after June 1, 1997. To defuse the measure in a state, the state's legislature would have to pass a bill opting out of the federal law.

The issue already is creating schisms within local trade groups. The Colorado Bankers Association is split among its membership over its position on an opt-out law.

This month, the association's legislative council recommended the CBA take a neutral position on opting out, with a caveat of opposing an opt-out bill should one be introduced in the Colorado legislature. But when the CBA board moved to approve the recommendation of its legislative committee, the smaller, but more numerous community bank members balked. CBA executive vice president Don Childears said the issue likely will be put to a vote of its members.

Large banks are expected to fight as hard to squelch opt-out movements as they did to pass the federal law allowing interstate branching. Mounting successful opt-out campaigns, said IBAA's Mr. Ence, depends on several factors.

"This is going to take a lot of local leadership," he said.

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