Sen. Jake Garn (R-Utah), chairman of the Senate Banking Committee, may try to block interstate branching for Washington-area savings and loans if the Federal Home Loan Bank Board proceeds with its plan to authorize branching before the Reagan administration -- Garn himself -- have had time to formulate policy on the issue.

Garn wrote the board expressing strong opposition after its chairman, John H. Dalton, revived the D.C.-area branching question last month. Garn, in an interview with the American Banker, said Dalton's move and come as a surprise to him. Garn said Dalton did not mention branching in a conversation they had just prior to the bank board's announcement that it would accept comments on the issue until Feb. 13.

Garn said yesterday through an aide that he hoped his letter would accomplish its purpose, but he was reserving the right to take other actions, including legislation, to block branching for now.

Dalton reopened the file after the Carter administration, in its waning days, issued a long-awaited report advocating that banking across state lines be phased in gradually. Garn had extracted a promise from Dalton's predecessor, Jay Janis, at his confirmation hearing in 1979 that he would take no action on the petition to branchby District S&Ls until 30 days after the White House report came out.

By the time the report was released in the first days of January, Janis had resigned. To the surprise of many in the banking community a political lame duck decided to push the project forward.

The appointment of the next bank board chairman is exprected within a week or so, but much more time will be required for Garn to sound out the administration and to hold hearings. Rather than have Dalton or his successor proceed during that period, Garn would consider introducing blocking legislation.

Garn told the American Banker "This is a major policy decision that I don't think should be made by the regulators and certainly not in the transition period to a new administration which has not had time to absorb the implications," he said.

He added, "It isn't that I oppose them on substance. It may be that someday I may be totally supportive of a natural market area, not just for savings and loans, but banks as well. But it's putting the cart before the horse until we make some policy decisions."

Interstate branching is a very controversial issue. Its proponents cite efficiency and economy in support of the concept. Its oponents fear that big banks will swallow up smaller banks if they are allowed to conduct business and make acquisitions outside their own states. Garn is considered a defender of small banks.

Unlike banks, savings and loans are not prohibited by federal law, but only by regulation, from establishing branch offices across state borders. Thus it was that District S&Ls, eyeing the affluent suburbs, petitioned the bank board in 1979 to let them branch on the grounds that surrounding Maryland and Virginia were part of their natural market. Smaller S&Ls that would be likely acquisition targets protested to the bank board.

Meanwhile the District's banks are unwilling to concede the edge to savings and loans. The larger ones -- in common with those in the neighboring states -- are scrambling to create bank holding companies so they can acquire smaller banks in other jurisdictions when and if interstate branching becomes law.

Washington, D.C. is considered a test case for interstate branching. If it is approved here, other metropolitan areas would be expected to follow suit, thus eventually leading to a major change in the banking industry.