Bank exchange: PNC is the latest to enter what once was the domain of homegrown giants.

• Author: Campbell, Spencer
• Position: FEATURE - Geographic overview

Pittsburgh-based PNC Financial Services Group Inc.'s $3.5 billion acquisition of Raleigh-based RBC Bank USA, which closed in March, was "driven by a confluence of need and opportunity," says Ray Grace, acting commissioner of banks. RBC had lost millions for its parent, Royal Bank of Canada, and PNC is a strong, well-capitalized financial institution that was looking to expand into the Southeast But it also furthers a budding but once unthinkable trend: out-of-state banks grabbing a big share of the Tar Heel market at the expense of powerful in-state banks.

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In 2001, North Carolina-based banks--led by Bank of America Corp. and First Union of Charlotte and Wachovia Corp. and Branch Banking & Trust Co. of Winston-Salem--had a stranglehold over their own territory, controlling more than 99% of Tar Heel deposits. Ten years later, they housed less than 80%. Some in-state institutions are weaker than ever. Wachovia needed an emergency buyer, BofA's stock is in the basement, and others are buried under bad real-estate loans. That's why Grace is can optimistic about the invaders. "I'm not sure whether it's good or bad. The phenomenon is fueled by North Carolina banks being vulnerable. But it's obviously indicative of the interest banks have in our market. And we welcome the flow of capital."

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OUT-OF-STATE BANKS IN NORTH CAROLINA JUNE 30, 2001

OKLAHOMA

Fort Sill National Bank Fort Sill

MISSISSIPPI

SouthBank Corinth

ALABAMA

SouthTrust Bank Birminaham

VIRGINIA

1. American National Bank and Trust Co. Danville

2. Community National Bank South Boston

3. Essex Savings Bank Norfolk

4. First Community Bank Bluefield

5. First National Bank Rocky Mount

6. Grayson National Bank Independence

7. Highlands Union Bank Abingdon

8. Mountain National Bank Galax

9. Patrick Henry National Bank Bassett

10. Peoples National Bank Danville

    INDIANA

    Harrington Bank FSB Richmond

    TENNESSEE

11. Greene County Bank Greeneville

12. Home Bank FSB Ducktown

    SOUTH CAROLINA

13. Carolina First Bank Greenville

14. Coastal Federal Savings Bank MyrtleBeach

15. First Capital Bank Bennettsville

16. Peoples Federal Savings and Loan Conway

    CALIFORNIA

    Wells Fargo San Francisco

    OKLAHOMA

    Fort Sill National Bank Fort Sill

    TEXAS

    Woodforest National Bank Houston

    VIRGINIA

    American National Bank & Trust Danville

    Bank of Hampton Roads Norfolk

    Carter Bank & Trust Martinsville

    Citizens Community...