For most of the 87-year history of the annual convention of the Virginia Bankers Association, representatives of the state's banks would gather at these collegial parlays to talk with executives they viewed as their sole competitors.

Now the picture is different. This week, as representatives of the 231 members of the association met here at the Homestead, the message was simple. "We have to realize that the competiton is not just the bankers in the room," C. Coleman McGehee, the association's new president, said in an interview today.

At least 14 out-of-state banks -- such as New York's Citicorp, First National of Chicago and the District's American Security Bank -- already are offering a variety of financial services from offices in Richmond. "Let's face it -- interstate banking is already here with the exception of the deposit-gathering function," McGhee said in an installation speech prepared for delivery Wednesday.

Credit unions, which in 1960 had only 1 percent of the deposits in the state, had 7 percent of those funds in 1978. The states's 54 savings and loan institutions, will, in effect, be offering checking accounts on Jan. 1. Money market institutions are offering similar high-return services all over the state.A listing of the new comeptitors goes on and on.

Therefore, the message at the convention was obvious: The banks of Virginia, like those across the country, must develop a new role in their communities. Their positon by the first of the year will involve interest-bearing checking or NOW (negotiable order of withdrawal) accounts, an increased presence in the mortgage market and the offering of a variety of services that the state's banking executives say will incresingly blur the differences between financial institutions.

"As you can see, we have a full plate of competitive forces to deal with," McGehee said in his speech. "We must be careful not to wind up arguing among ourselves while our competitors move around us."

The state's big banks already are geared up for the changes, most of which are a result of the omnibus federal banking legislation enacted earlier this year. Since most of these large institutions have for over ayear been offering accounts which permit consumers to transfer funds from savings to checking accounts, the introduction of the NOW accounts is more of a marketing, rather than a technical, problem.

"We think we're already in there," said Joseph Jennings, chairman of the United Virginia Bankshares, the state's largest bank, with assets of more than $3.2 billion. "It should be little more than a milliblip on our computer."

About 40 percent of the customers of United Virginia -- which has more than 160 branches, including more than 35 in the Northern Virginia area -- have moved from conventional checking accounts into the transfer accounts, Jennings said.

Yet, one of the results of the introduction of these interest-bearing accounts, which will offer rates slightly below savings accounts, may well be an end to free checking at some of the banks because of the cost. Milton Drewer, president of First American Bank of Virginia, said it "appears" his bank with 42 branches in the region may have to end free checking services.

Nevertheless, the banks in the state are spending millions of dollars to enter the world of NOW. "It will be a very competitive market, and that's probably good," said W.O. Pearce, the executive vice president of the association. "The big banks nearly have it already; now everybody is gearing up for it."

To a certain extend, the bankers here have a fear of rate wars under the new regulatory schemes. "Our industry has to be awfully careful to price our products right," McGehee said. "Like any other business, we have to make money."

Yet the introduction of these account is only the beginning of the new competition among financial institutions in the state. The market for financing home mortgages, still predominately the business of the savings and loan industry, also may change just as dramatically as the market for saving dollars.

But the revolution in the banking world is before an industry that has been historically slow to change.

"There are gigantic changes," said John Bernhardt, the outgoing association president.