Some Tar Heel banks find bigger is not always better.

• Position: North Carolina banking industry

You know," says Mike Patterson, who took Raleigh-based Triangle Bancorp Inc. from $53 million in assets to $2.3 billion before agreeing to sell it to Centura Banks Inc. in August, "as long as people think you're a community bank, you still are."

The $608 million acquisition will boost Rocky Mount-based Centura's assets to $11.3 billion and allow it to jockey with Raleigh-based First Citizens BancShares Inc. and Durham-based CCB Financial Corp. for fifth in state market share. Centura sounded a rare upbeat in a year that, for most Tar Heel banks, ended on a sour note. Although earnings were decent, investors began anticipating worse in 2000 -- and fled. Many bank stocks were down 40% for the year. While the Triangle mortgage market was hot, lenders squirmed as interest rates inched toward 9%.

The year extracted a high price from bankers who forgot Patterson's homespun truism, but it wasn't surprising that many did. "It's a lot easier to build a big bank than to run one," notes John Forlines Jr., chairman of Granite Falls-based Bank of Granite Corp.

Case in point is Charlotte-based First Union Corp. The nation's sixth-largest bank shed 5,800 jobs in March to help digest its $19 billion, 1998 buyout of Pennsylvania-based CoreStates Financial Corp. It pushed its technology-driven Future Bank, forcing branch customers to use computers and automated teller machines.

Customers revolted. By July, First Union was scrambling to hire or rehire 2,000 tellers. The stock dropped, from $64 to below $40, an equity hit of $20 billion. Plans for a Charlotte skyscraper crumbled, and heads rolled, including that of John Georgius, president and Future Bank architect, who retired. Late in the year, Wall Street's refrain was, "We want more." Some bankers believe more heads are on the block, possibly even Chairman Ed Crutchfield's. His $9.3 million compensation was tops among Tar Heel executives in 1998, according to a Springfield, Va.-based research company.

Another case in point is Charlotte-based Bank of America Corp. Formerly NationsBank, its $572 billion merger with San Francisco-based BankAmerica Corp. in 1998 extended its franchise from coast to coast. It spent the past year mending fences, particularly in the former BankAmerica's West Coast stronghold. "Our key focus is retaining customers," says David Watterworth, executive vice president for marketing. One strategy is Model Banking, intended to increase branch technology and efficiency. Sound familiar...