Limited-Service Banks among Biggest Gainers, Asset Rankings of Top 2,500 Also Sees Leaps from Mergers

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Limited-Service Banks Among Biggest Gainers

Asset Rankings of Top 2,500 Also Sees Leaps from Mergers

Limited-service banks posted some of the largest gains in assets last year, according to the American Banker's new survey of the top 2,500 commercial banks, ranked by assets.

Four limited-service banks in Delaware, established by some of the nation's largest banking companies, posted substantial asset gains last year. A limited-service bank, as defined for survey purposes, is one with a commercial bank charter, but which makes few or no commercial loans. In most cases these institutions have been used by a bank holding company to handle a particular function, such as their credit card operations, and to take advantage of higher usury ceilings and tax advantages.

Chase Manhattan Bank (USA), Wilmington, Del., posted the largest gain in rank among the nation's 100 largest banks, moving up 83 places in rank to 78th position. The bank--which handles credit card operations for its parent Chase Manhattan Corp.--had a 131% gain in assets, to $4.51 billion on Dec. 31, from $1.96 billion a year earlier. Chase was established in Feb. 1982, under Delaware's Financial Center Development Act of 1981. Since yearend 1982, deposits have grown by almost 600%, and assets have risen by more than 1,300%.

Citibank (Delaware), New Castle, a Citicorp affiliate, had the second largest gain in asset rank among the top 400 banks. Its assets jumped by more than 700%, to $903.6 million on Dec. 31--moving up 1,778 places to rank 340th. The bank, which was established in June 1982, is primarily engaged in cash management services and wholesale banking.

The Equitable Bank of Delaware, Dover, Del., a subsidiary of Equitable Bancorp., Baltimore, had a 60% gain in assets, moving up 248 places to rank 597th, with $424.6 million in assets. The bank was established in June 1982 and handles credit card operations for its parent.

The assets at the NBD Delaware Bank, Wilmington, an affiliate of NBD Bancorp., Detroit, grew by more than 114%, to $291.2 million on Dec. 31-- advancing 862 places to rank 831st. NBD Delaware was established on May 23, 1984, and is "currently confining its activities to credit cards,' according to a spokesman for the bank.

NBD Delaware is the first bank to begin operations under Delaware's Consumer Credit Bank Act of June 1983. The act was designed to bring in institutions that found it difficult to meet both the capital and employment requirements of the Financial Center Development Act, or FCDA.

Under the FCDA, a bank must have $10 million in capital to begin operations; at the end of one year, it must have $25 million in capital as well as 100 employees. Under the Consumer Credit Bank Act, or CCBA, the bank's capital requirement is linked to its credit card portfolio. And the bank does not have to meet the employment requirement if it is linked to an association that does qualify.

Computer Communications of America and the Southwestern State Bank Card Association have recently established Delaware operations to provide services for CCBA banks. At present, six CCBA bank applications are pending, according to a spokesperson for the Office of the State Bank Commissioner.

Like the FCDA, banks established under the CCBA are limited to one location within Delaware. …