Flush with deposits, banks are luring out-of-state owners

Residents of Boca Raton, Fla., looking for a place to park their cash or apply for a loan can walk along one block of US Highway 1 in the ocean-front city and choose among branches of a savings-and-loan based in New Jersey, a bank from North Carolina, or an S&L with headquarters in California. A year and a half ago, all three belonged to Florida-based institutions.

The flurry of sign-switching symbolizes a wave of change sweeping through the financial services industry, cresting in Florida.

Florida is a very profitable place to run a bank. Earnings of the state's five largest bank holding companies rose 29 percent last year, compared with a puny 5 percent for the nation's 15 largest bank holding companies.

Banks here have been buoyed by the burgeoning local economy and are for the most part free of the embarrassing loans to oil wildcatters or distressed third-world countries that burden their bigger cousins. The bulging vaults at Florida banks are drawing envious stares.

''The product must flow,'' says Charles E. Buker Jr., of Barnett Banks in Miami, president of the Florida Bankers Association. He is talking about money, the product of banks and S&Ls. Florida is a ''capital excess'' state, meaning that the supply of money flowing into financial institutions outstrips the demand for loans. Money, then, will flow out of the state in search of high returns.

Banks are still barred by federal regulations from crossing state lines to collect deposits. But the wall is cracking. S&Ls are a particular target for takeover.

Heavily dependent on home building, Florida is one of the few states where S&L deposits exceed bank deposits. Thrifts last year controlled deposits of about $48 billion, against $45 billion for banks.

High interest rates in 1981 and 1982 played havoc with S&L balance sheets - pushing many associations to the brink of collapse. Federal regulators arranged numerous mergers to bail out weaker thrifts, often pairing a troubled S&L in the desirable Florida market with a troubled S&L in the depressed Northeast or Midwest.

''Look at the bailouts over the past two years,'' says William Norton, a bank analyst with Blackstock & Co. of Jacksonville. ''Every major merger included an S&L in Florida or Texas. Those were the sweeteners.''

As a result, six of the nation's 20 largest S&Ls now have subsidiaries in Florida.

''Florida is not a captive market anymore,'' says Tim Rayle, an analyst with Raymond James & Associates of St. Petersburg. ''The out-of-state competition will force the local S&Ls to stay on their toes.''

Change is coming in bits and pieces. Major banks such as Morgan Guaranty of New York, Mellon of Pittsburgh, and Northern Trust of Chicago have set up trust companies in Florida, concentrating on wealthy retirees needing estate-planning services.

Citicorp of New York, the parent of Citibank, has been quietly pushing the Florida Legislature for several years to authorize interstate banking. The bank has hired Lawton Chiles III, head of a Tallahassee public relations firm and son of a United States senator, to lobby on its behalf.

NCNB Corporation of Charlotte, N.C., parent of North Carolina National Bank, has already jumped into Florida through a loophole in state regulations.

A 1972 Florida law designed to block interstate banking contained a grandfather clause allowing out-of-state banks to retain ownership of Florida trust companies.

NCNB, which owned a Florida trust company when the law was passed, argued in 1981 that the grandfather clause allowed it to purchase a bank. After winning a test case, NCNB in 1982 bought two large bank holding companies in Boca Raton and Tampa as well as a smaller operation in Miami. From nothing two years ago, NCNB now has assets of $2.7 billion in Florida.

Chemical Bank of New York isn't waiting for the law to change. Florida National Banks of Florida Inc., based in Jacksonville, was fighting an unwelcome takeover bid from Southeast Banking Corporation of Miami in November 1981 when Chemical stepped in and offered to buy Florida National for half again book value whenever interstate banking becomes legal. The Federal Reserve objected to the initial agreement, the two banks are preparing a revised contract.

Analysts predict that if Florida National uses the clout of a future merger with Chemical as a tool to acquire other banks in the state, there will be a rush by big banks in New York, Chicago, and San Francisco to line up willing partners in Florida.

Florida bankers say the turmoil is just beginning and won't end until the nation completes the task of redefining its financial service industries. ''There will be injuries and there will be benefits in the adjustment period, but in another three or five years it will level off,'' says Mr. Buker of the Florida Bankers Association.