Officers of Riggs National Bank have concluded that large banks in the country's money centers are embarked on a course of breaking down America's traditional barriers to conducting business on a nationwide basis.

And Riggs is preparing major expansion of its own, to counter what is seen now as a significant competitive threat. Nothing less than "the future of this bank" is at stake, said Riggs chairman Vincent C. Burke Jr., in an interview this Week.

Riggs, which a rich history that stretches back to the early 1800s, long has been the biggest commercial bank in the Washington area. As of Sept. 30, Riggs had total deposits of $1.5 billion compared with $1.2 billion for its chief area rival, American Security Bank.

When matched with banks in New York, Chicago, Los Angeles and San Francisco, some of which count their deposits in the tens of billions of dollars, the size of Riggs is small.

In part, the size of Riggs reflects its past inability to open branches in the suburbs of Washington, across state borders. Nevertheless, the District-based institution is nearly as big as the largest banking companies of Baltimore, Richmond and Norkfolk, all of which do business on a state-wide basis.

Burke and Riggs president Daniel J. Callahan III said the competitive situation for banks in this part of the country has begun to change drastically, however, with aggressive salesmanship by banks based in Philadelphia, Chicago and New York.

"You find a great deal of bankers on the street today," said Burke. "Banks in the money centers have made an obvious commitment to compete with banks [in various regions] that up until now have been very good customers" through correspondent relationships, the Riggs chairman added.

In particular, he singled out Citi-bank of New York, the nation's second largest commercial bank and a subsidiary of Citicorp. "They have made a decision to go national as much as possible in every way . . . Citibank's market now has been defined as the United States of America."

To Burke and Callahan, that adds up to a challenge. On a shelf behind the bank chairman, in his office on the second floor of a bank headquarters that faces the U.S. Treasury Department, are three black books. Starting with an initial volume from early 1976, the books detail options Riggs officers currently are studying to meet the new competition.

Burke and Callahan declined to identify in specific terms the new types of business operations under study. Nor would they provide a timetable for their expansion plans.

But Burke did say that he and Callahan are paying more attention to the future "regulatory, legal and marketing environment" for Riggs than any other matter. A third update of the original plan now is in progress and it is "the top priority," Burke added.

In general terms, Burke and Callahan indicated some of the directions in which their bank may move. Primarily, they emphasized their determination to make Riggs a large regional bank that has resources to compete with the national banks inside its own market - apparently the District, Maryland and Virginia, at the very least.

But the types of businesses a banking firm may conduct are varied and not limited to branches with tellers for retail transactions. Some Riggs activities will involve a more national perspective. Indeed, Riggs always has participated to some extent in national business lending.

Commercial and real estate lending, bank credit cards and certain savings instruments already have broad markets in the banking business. Citibank has been a leader in exploiting all of these fields, the Riggs officer said.

Riggs itself has reorganized management into four groups in the last year and a half, to help meet the new challenges. The bank has expanded its national sales operations and, to an even greater extent, regional marketing has been emphasized. Overall loan volume throughout 1977 has been running about 20 per cent above year-earlier figures.

In the local retail market. Riggs recently launched a promotion designed to encourage initial loan applications by telephone. The campaign has several weeks to run and has generated business three times normal inquiries to the bank, Callahan said.

Burke declined to forecast earnings for the recent third quarter, which he said should be compiled by next week. He did state that the first nine months were "very good."

In general, regional banks have been outperforming many money center banks in 1977. For the first six months, Riggs profits totaled $6.7 million ($2.25 a share), up 19 per cent from $5.6 million ($1.89) in the 1976 period.