DRAWING DOWN.

• Author: Maley, Frank
• Position: North Carolina banks - Illustration - Statistical Data Included

For more than a decade, the mergers that begat megabanks spurred creation of little ones. That era is coming to an end.

In the '90s, Winston-Salem saw the upside of bank-industry consolidation. Already home to Wachovia, the state's third-largest bank, the city began to gain ground on Charlotte as a banking hub. In 1992, Southern National Corp., then sixth-largest, moved its headquarters there from Lumberton. Three years later, Wilson-based BB&T, the state's fourth-largest bank, merged with Southern National, and the new bank chose Winston as its headquarters city.

Since then, BB&T has increased its assets sixfold, partly by buying United Carolina Bank, then eighth-largest, in 1997. Ten years ago, BB&T was one-fourth Wachovia's size. At the end of last year, it was four-fifths as large -- and gaining.

BB&T remains fourth on BUSINESS NORTH CAROLINA'S annual ranking of independent Tar Heel banks and thrifts -- once ranked by assets, now by revenues. But the wannabe banking hub is no more. The city lost Wachovia in September when it was bought by Charlotte-based First Union. Wachovia's unusual name -- it comes from the Wachovia tract, settled by the Moravians -- will survive because First Union agreed to take it. But Wachovia's headquarters -- in Winston-Salem since 1879 -- will move to Charlotte.

So the Big Four have become the Big Three. But really, to include any other North Carolina bank in the same tier as Bank of America is an act of charity. In 2000, it had 52% more assets than all other Tar Heel banks and thrifts combined.

History says a wedding like Wachovia and First Union's will beget community banks, led by bankers convincec they can be more neighborly, more rooted in small towns than the big boys. These bankers will try to snatch customers from the giants by painting them as too big to care about local folks. That's what MountainBank in Hendersonville and American Community Bank in Monroe are aiming to do. They moved the most places in the annual bank ranking from last year to this year. MountainBank went from No. 64 to No. 36, American Community from No. 76 to No. 52. (See story on page 44.)

But those two may be among the last of a breed. Little banks aren't selling for the big premiums they used to, robbing them of their allure to investors. That kil's an incentive to form them. And as big banks provide more products, it's tougher for little banks to compete. They lack the big banks' economies of scale.

That's one reason the state is eeing a waning number of bank start-ups. Of the 110 companies on this year's ranking, nine began in 2000. Three were started in 2001, and it's unlikely there will be another. Banks need two to six months to launch, and by mid-September, the state Banking Commission had no applications.

RANKING TAR HEEL BANKS Rank City '01 '00 1 1 Bank of America Charlotte 2 2 First Union [1] Charlotte 3 3 Wachovia [2] Winston-Salem 4 4 BB&T [3] Winston-Salem 5 5 First Citizens BancShares Raleigh 6 7 First Charter Charlotte 7 8 Bank of Granite Granite Falls 8 10 Fidelity Bancshares Fuquay-Varina 9 11 First Bancorp [4] Troy 10 9 LSB Bancshares [5] Lexington 11 12 Southern Bancshares Mount Olive 12 17 Peoples Bancorp of N.C. [6] Newton 13 15 FNB Financial Services [7] Reidsville 14 19 FNB [8] Asheboro 15 21 First South Bancorp [9] Washington 16 16 High Point Bank High Point 17 13 Clyde Savings Bank [10] Clyde 18 18 First National Bank Shelby 19 14 Piedmont Federal S&L Winston-Salem 20 20 Yadkin Valley Bank and Trust Elkin 21 22 Macon Bancorp Franklin 22 24 F&M Financial [11] Granite Quarry 23 23 Asheville Savings Bank Asheville 24 26 1st State Bancorp [12] Burlington 25 34 Southern Community Bank & Trust Winston-Salem 26 25 Cooperative Bankshares Wilmington 2000 Rank revenue [*] '01 '00 (in millions) 1 1 Bank of America $32,956.0 2 2 First Union [1] 14,368.0 3 3 Wachovia [2] 4,447.0 4 4 BB&T [3] 2,794.7 5 5 First Citizens BancShares 567.5 6 7 First Charter 138.5 7 8 Bank of Granite 44.7 8 10 Fidelity Bancshares 43.7 9 11 First Bancorp [4] 43.4 10 9 LSB Bancshares [5] 39.8 11 12 Southern Bancshares 30.6 12 17 Peoples Bancorp of N.C. [6] 25.6 13 15 FNB Financial Services [7] 25.6 14 19 FNB [8] 25.5 15 21 First South Bancorp [9] 23.2 16 16 High Point Bank 23.0 17 13 Clyde Savings Bank [10] 22.5 18 18 First National Bank 22.4 19 14 Piedmont Federal S&L 22.0 20 20 Yadkin Valley Bank and Trust 18.7 21 22 Macon Bancorp 17.7 22 24 F&M Financial [11] 16.7 23 23 Asheville Savings Bank 15.6 24 26 1st State Bancorp [12] 15.2 25 34 Southern Community Bank & Trust 14.1 26 25 Cooperative Bankshares 14.0 Rank Assets [**] '01 '00 (in millions) 1 1 Bank of America $642,191.0 2 2 First Union [1] 254,170.0 3 3 Wachovia [2] 74,031.7 4 4 BB&T [3] 59,340.2 5 5 First Citizens BancShares 10,691.6 6 7 First Charter 2,932.2 7 8 Bank of Granite 661.7 8 10 Fidelity Bancshares 907.7 9 11 First Bancorp [4] 915.2 10 9 LSB Bancshares [5] 795.6 11 12 Southern Bancshares 804.9 12 17 Peoples Bancorp of N.C. [6] 519.0 13 15 FNB Financial Services [7] 685.9 14 19 FNB [8] 565.6 15 21 First South Bancorp [9] 575.5 16 16 High Point Bank 526.4 17 13 Clyde...