Until the out-of-state banks began to come in around 1981," says one local banker, "three institutions ran this state.

Most states outside the Southeast already allow out-of-state banks to do some business.

"You think a larger out-of-state bank is going to do that?"

The key to the gradual recovery of the Texas economy was that the failed banks were bought by out-of-state banks.

At the time, out-of-state banks were not permitted to own Connecticut banks.

Technology allowed out-of-state banks to compete in places where they had no branches, and under pressure from that competition, states gradually lifted their restrictions.

Some people may worry that local merchants won't accept checks from an out-of-state bank.

To some extent, the legislation recognizes the reality that most states already allow out-of-state banks to acquire local institutions.

But older buildings looking for, say, $5 million to $20 million, are finding that the out-of-state banks are frequently the best places to turn.

And, as the out-of-state banks make more loans in this area, their familiarity with it continues to grow.