ASSESSING THE MERGER : Mixed Impact in Bank Deal : Finance: The BankAmerica-Security Pacific merger won’t affect affluent customers, but marginal ones may find the going tougher.

Customers have little to fear from a BankAmerica-Security Pacific merger, experts say.

Good customers, that is.

Depositors with fat balances and businesses with strong credit histories will continue to be pursued by banks in Southern California, where competition for good deals remains fierce.

But for the banks’ marginal customers--less affluent depositors, less credit-worthy companies--an already tough banking scene is likely to get tougher. The flagging economy has made bankers more particular about where and how they lend, and some expect the current wave of mergers to worsen the credit crunch.

“If you’re changing your bank now and you don’t have a good track record, it’s going to be harder to get financing,” said Arthur D. Sweet, president of Canoga Park-based Certified Business Funding.

On the consumer side, although the banks say the merger should cut annual expenses by $1 billion within three years, consumer advocates don’t believe that the savings will trickle down very far.

“There is a trend on the part of both banks to raise fees and reduce services, and I would expect that to continue,” said Mark Foster, a policy analyst for San Francisco-based Consumer Action.

Moreover, with the expected closings of perhaps hundreds of branch offices and the layoffs of thousands of workers, he said, “you can expect to see longer lines at tellers and ATMs, degradation of service and confusion.”

Again, Foster and others predicted, much of the pain will be felt at the margins--in poor neighborhoods where branch offices are already unprofitable and among less desirable business customers.

“For inner-city customers, it’ll amount to less choice and less service, and if you don’t like it, you can lump it,” he said.

Foster added, however, that his and other consumer groups are “cautiously optimistic” that BankAmerica and Security Pacific will follow through on ambitious inner-city lending commitments that they made before the merger announcement.

In the hotter market sectors, the post-merger Bank of America may be the monster of the West, but it won’t be able to run roughshod over the Southern California banking scene. There’s too much competition here for that.

“The monopolistic element has been way overblown,” said Robert A. Eisenbeis, banking professor at the University of North Carolina’s Kenan-Flagler Business School.

In finance terms, he said, the markets served by B of A and Security Pacific are “highly contestable.” That means that any attempt by the merged mega-bank to exploit its size advantage by price gouging would merely draw more competitors into the fray and bring prices back down.

Eisenbeis also doubts whether the two banks will ever realize the savings they forecast. The disruptive effects of the merger in the early years may cancel out the cost-cutting benefits later on, he said. In a service business such as banking, it may be hard to get productivity out of workers who are distracted by the consolidation.

“It’s like kicking a dog and then asking it to go hunt with you,” Eisenbeis said. “If you get half the employees looking over their shoulders wondering if they’re going to lose their jobs, it doesn’t put them in much of a sales mode.”

For small businesses, the merger may cause few ripples. The reason? Both banks lend mainly to big companies.

“Security Pacific and Bank of America have done very little in financing small business loans,” said M. Hawley Smith, director of the Small Business Administration’s office in Glendale, the nation’s largest SBA district office. “Having done little in the past, I wouldn’t expect them to do much in the future.”

“I rarely come across them as competition,” echoed Jennifer Leathers, a small-business loan broker in Huntington Beach. “They just aren’t interested in the small-potatoes people.”

For business borrowers who do bank with Security Pacific or Bank of America, however, any disruption is to be feared.

The banks’ goal is to provide “uninterrupted, seamless service” while the merger goes forward, B of A spokesman Russ Yarrow said. But some business people are nervous anyway, knowing that losing a branch manager or lending officer who understands your business can be traumatic--even fatal--to a company.

“Once you establish a business and personal relationship with a bank, when that bank is eliminated from the marketplace . . . the relationship is lost,” said Manuel F. Iglesias, president of International Translation Bureau Inc., a Los Angeles interpreting business. “Other banks, no matter how good their reputation, can’t replace it easily.”

Iglesias knows. In 1978, when he was running an electronics company in Puerto Rico, his bank collapsed, forcing him to restructure his own business drastically when the credit dried up. He survived, but others failed.

There is concern nationally that the wave of banking mergers will worsen the credit crunch that already exists in some areas.

After a merger, “in many cases the initial response is to tighten restrictions on lending until you get better control over expenses,” said John P. Galles, executive vice president of the National Small Business United lobbying group in Washington. “Often the lending authority at the local level drops significantly, and bigger loans get passed upstairs to a central credit committee,” he said.

The result is the kind of delay that can hurt business.

“When you have to wait on a bank for any reason, you can literally lose clients,” said John Tenorio, president of J. Arthur & Associates, a Los Angeles advertising firm.

After switching his loan business from Security Pacific to Bank of America, Tenorio decided it made sense to bank with both of them. “For some odd reason, I felt I didn’t want to keep all my eggs in one basket,” he said. “And now look--they’re back in one basket again.”