The borough of New York City that became lodged in the national consciousness as the picture of urban blight is making a comeback.

Complaints of redlining contributed to the notoriety of the South Bronx. But now bankers are competing among themselves and with other commercial interests for desirable and affordable storefronts.

The banks, particularly New York's money-center giants, still catch flak from community activists who want them to do more business locally. But there are unmistakable signs of a banking resurgence.

Two branches opened here in the space of a week this summer, and a third is planned for the heart of the South Bronx, which has been without a bank for as long as anyone can remember.

"The South Bronx has changed dramatically in the last 10 years," said Joseph E. Vincent, senior vice president at North Fork Bancorp, who is responsible for all of the bank's eight Bronx branches.

"All the abandoned buildings have been rehabbed," he said. "The Bronx has come back to such a degree that it's hard to find space. Forget it-you can't rent on Fordham Road," one of the borough's main shopping streets.

The Bronx revival is largely due to the efforts of nonprofit organizations working with federal, state, and city agencies seeking to reverse legacies of crime and neglect. Spurred by Community Reinvestment Act requirements, many of New York's biggest banks formed relationships with the community and public-sector agencies and are now seeking to profit from the joint labors.

The newfound attention has not been lost on the locals. Two elderly African-American women waiting for a bus outside a new Chase Manhattan Bank office on University Avenue said the financial institutions' return is "a good thing, especially for our senior citizens."

The women pointed out that people on limited incomes had to depend on public transportation to reach banks in other communities. Now, branches and automated teller machines are cropping up in walking distance.

Small-business owners around the new Chase branch are also "very happy about it," said beauty-shopkeeper Pedro Rodriguez, speaking Spanish to a friend who translated. "We really needed a bank, and it makes the neighborhood feel more secure."

"The key to our success is the not-for-profits, the churches," said Gregory Garden, Chase Manhattan Corp.'s district manager for the South Bronx and northern Manhattan. "They build houses, run bus companies, help supermarkets move to the neighborhood."

Chase, the nation's biggest bank and the market-share heavyweight in the Bronx, with 35 branches and $2.7 billion of deposits, uses its nonprofit- organization contacts to find small-business loan prospects. The tactic is "a big part of our fall campaign," Mr. Garden said.

And Chase is not alone. North Fork hired Mr. Vincent in early 1997, after he had been running the nonprofit South Bronx Overall Development Corp. (He worked at Chase earlier in his career.)

Marine Midland Bank, a subsidiary of London-based HSBC Holdings, with 10 branches in the Bronx and 7.8% of the county's banking market, also looks to the nonprofits.

"Banks need to respond to the community," said Martin Liebman, Marine's regional president for New York City, Westchester County, and Long Island. "We have three people working in our loan production office in the Bronx. They all speak Spanish. They all belong to community groups."

By day, these employees work for the bank, and by night they are making outside contacts, Mr. Liebman said.

For decades, the Bronx was anything but a magnet for bankers. It sealed its status as a symbol of urban blight when the city suffered an electrical blackout in July 1977. The looting and vandalism were worst in the South Bronx. The aftermath contributed to enactment of the Community Reinvestment Act.

Stores on the East Tremont Avenue commercial strip were boarded up. A Citibank branch in the University Avenue area was torched, and the bank responded by shutting its doors permanently.

The Bronx population began a steep and swift decline.

A well-publicized walk through the South Bronx by President Jimmy Carter focused attention on inner cities generally and began to attract government money and charities to the Bronx. Eventually, a federal empowerment zone was created.

Nearly 30,000 new and rehabilitated housing units have been created in the Bronx since 1987, said Kevin Nunn, president of the Bronx Overall Economic Development Corp. In the same period, the county has netted 5,500 new private-sector jobs at a time when New York City as a whole has lost 190,000 positions.

KMart opened its first store in the Bronx during the past year, a 105,000-square-foot retail mecca, while J.C. Penney inaugurated a new 168,000-square-foot store. Home Depot just arrived in the northeast Bronx, and National Wholesale Liquidators anchors a new 145,000-square-foot mall, complete with a Rite-Aid drugstore and an Edwards Super Food Stores.

Meanwhile, immigrants have been streaming in from Latin America, the Caribbean, and Korea, bringing a strong entrepreneurial bent. Many of the small businesses they established, largely on a cash basis, are now ready for a leap to more sophisticated banking.

Banco Popular, the subsidiary of Puerto Rico-based Popular Inc., has four Bronx branches and is looking to open "at least two more," said John Del Valle, head of retail banking.

"It's incredible what's gone on in the Bronx," he said in an interview. "The vitality has really grown, particularly on the small-business end. New businesses that are starting up need to keep costs under control, and the immigration provides a low-cost labor force."

North Fork, which is based on Long Island, has responded by offering small businesses revolving credit lines under $50,000 that require no documentation.

Marine Midland is trying to lend to this market and to larger companies that use the Bronx as a shipping point to other parts of the metropolitan region.

Chase is relying on small-business "street bankers" and experienced middle-market lenders to ply the industrial sector and the food distributors at Hunts Point and the Bronx Terminal Market.

"We have relationships with 65% of the companies in the Bronx," boasted Patrick McGrath, Chase's middle-market regional manager.

Thrifts are also prospering, said Steven Bush, senior vice president and finance director at Apple Bank for Savings, the second-largest savings and loan in Bronx market share. "We've been looking to expand the branch system as a matter of strategic direction," Mr. Bush said.

Apple got a boost in the Bronx because of the major commercial banks' departures in tougher times. "You have bank branches that have gone vacant, and landlords are looking to lease to another bank," Mr. Bush said.

"All you have to do is walk in and turn on the lights. It's not a slam- dunk profit opportunity, but relative to buying other banks at the prices we're seeing in the market today, it works."

The smaller banks in the area are trying to use their more personal touch to win customer loyalty. While Chase and Citicorp call attention to their high technology, Banco Popular, North Fork, and Marine Midland emphasize relationship building.

"The South Bronx is clearly underbanked," said Mr. Vincent of North Fork. They need a mix of services that differs from other areas, he said, noting that 25% of the households do not have telephones, let alone personal computers.

"The big banks-they don't like to touch people, paper, cash," the banker said. "We can fill that gap very nicely.".

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