Business is booming in Maine - if you're a start-up community bank.

Three of them have opened their doors since 1990, and all are growing at a blistering pace despite a lackluster economy.

They've succeeded because the public is confused by sudden changes in bank ownership as larger institutions have moved into the market through acquisitions.

"It's almost like a backlash against the very large chain banks," said Jeffrey L. Cohn, banking industry analyst at H. C. Wainwright, Boston. "It's a reaction to the more depersonalized way of doing business which is efficient for the larger banks."

He added, "If you're a customer, it's like having a choice between just chocolate and vanilla. You've got Fleet flavor and Key flavor."

Profits in Presque Isle

One hot start-up has been First Citizens Bank in far north Presque Isle.

First Citizens opened in April 1990 with $4.2 million of capital. By the end of its. first year, the bank held $20.1 million of assets, which has since soared to $70.2 million.

The bank is profitable to boot. For the first six months of 1994, it earned $1.5 million, up 21% over the previous year.

The bank now has four branches, one as far away as Lincoln, 100 miles south of the maine office.

"There was less and less local control and the people in this area wanted to have access to a locally owned and managed financial institution," said Susan Grove-Markwood, assistant marketing manager of First Citizens.

"There was a feeling that not only the operations process but some of the loan decision-making was removed from the area," she said, "and that was impacting on people's ability to get the funds people needed."

The bank has also seen a surge in commercial, agricultural, and residential lending, accounting for a $3.4 million, or 7%, increase in assets in the month of June alone.

While First Citizens' act is a hard one to follow, Maine Bank and Trust Co., based at the other end of the state in Portland, has been the juggernaut of the state's startups. It had $7 million of capital in November 1991 when it opened, and the bank expanded to fill the void created when Fleet Financial Corp. bought two competing banks.

Only five weeks after opening, Maine Bank and Trust had assets of $14 million. Today, it has $92 million.

Turned Corner This Year

As consistent with most startup banks, Maine Bank and Trust struggled for profits during its first three years, but earned $358,000 in the first six months of 1994.

"We've been very well received," said Wayne McGarvey, president of the downstate bank. "It was getting back to providing what the marketplace used to appreciate in the personal service arena."

Maine Bank and Trust, which now has four branches in the Portland area, expects to open two more in the towns of Scarborough and York. It is also awaiting Federal Reserve Board approval to set up a one-bank holding company, Maine Bank Corp.

Growth Opportunity?

There could be other growth opportunities, too. Earlier this month, Casco Northern Bank, announced it would sell its Maine and Vermont affiliates to Keycorp.

Mr. McGarvey said Keycorp may be forced to give up some of Casco's branches because of overconcentration in some regions. But he refused to say whether Maine Bank and Trust will bid on the branches.

Bangor, in the center of the state, has its own powerhouse, Merrill Merchants Bank, which set up shop in October 1992, and immediately acquired seven branches of Fleet Bank of Maine, which was forced to divest because of its domination of the market.

That allowed the bank to start with deposits of $64.5 million and loans of $24.5 million. The bank now has $99.3 million of assets and $73 million of loans.

The strong growth of the startups still leaves some analysts puzzled.

"I can't put my finger on anything to explain that," said Warren Heller, research director with Veribanc, a bank ratings firm in Wakefield, Mass. Veribane gave high ratings to Maine Bank and Trust and First Citizens.

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