First Maryland Bancorp's short-lived exploration of a possible merger with a big out-of-state bank holding company contradicts the thrust of its most recent annual report to shareholders.

The theme of First Maryland's 1984 annual report, "Stability in Motion," is an apparent contradiction, the Baltimore bank company told shareholders. It is, nonetheless, "an accurate description" of First Maryland Bancorp, according to the annual report.

But First Maryland's recent, although abortive, attempt at a merger also appears to be a contradiction of earlier statements about its future, based on its two-year partnership with Allied Irish Banks Ltd.

"The decision to create a relationship with Allied Irish Banks was one of the most significant in this company's 179-year history," First Maryland declared at the end of 1984. That remains to be seen, of course.

By entering into a partnership with Allied Irish, First Maryland, in what it described as a "strategically bold move," ostensibly positioned itself "with precisely the kind of stability in motion which permits the basics of banking to become a focal point of our strategic planning."

First Maryland, whose principal subsidiary is First National Bank of Maryland, signed an agreement in 1983 giving Allied Irish, Ireland's largest banking firm, the right to purchase control of First Maryland. Allied Irish currently owns 45 percent of First Maryland, and terms of the agreement call for the purchase of additional shares that would raise Allied Irish's stake to more than 50 percent.

Although First Maryland has retained its management and, supposedly, policies developed by that management, it has been widely believed in Maryland's banking community that Allied Irish would call the tunes in any expansion moves by Maryland's second-largest bank company. Moreover, Allied Irish had been expected to use its huge investment in First Maryland and the Baltimore company's strategic location in a major U.S. market to enhance that investment. The significance of the partnership between First Maryland and Allied Irish took on greater significance as momentum began building recently toward interstate banking.

Indeed, most observers of Maryland banking had assumed that First Maryland would use the partnership to strengthen its competitive position in a dramatically changed banking environment.

But then came First Maryland's surprising announcement last month that it was holding discussions that could lead to an affiliation with a larger bank holding company, which it refused to identify. New meaning had been given to stability in motion.

Except for two brief statements announcing the existence, then termination of merger talks, First Maryland has been mum on the subject. Allied Irish apparently felt compelled to state the obvious this week by declaring that it had been "supportive of exploring the opportunity" for a merger by First Maryland. It was "equally supportive" of the decision to discontinue the talks, Allied added.

Other stockholders probably have a different view of this latest example of stability in motion, which sent First Maryland's stock on a wild roller-coaster ride over the past month. Having risen sharply on general speculation about possible interstate bank mergers (practically all regional bank stocks have soared in recent weeks), First Maryland's stock spiraled from around 41 in early July to 53 1/2 on the day preceding the announcement that merger talks were under way. The announcement itself pushed the stock as high as $66 a share before it began tumbling, inexplicably, to $51, before First Maryland announced that the merger talks were off.

Several analysts say the merger talks may have collapsed when the two sides couldn't agree on a price for First Maryland while the stock was wildly fluctuating.

But events unrelated to stock price may have contributed to First Maryland's decision to discontinue the talks. Although First Maryland never identified the other bank company, reliable sources in Maryland's banking industry had said that discussions were being held with United Virginia Bankshares Inc. While those discussions were taking place, UVB reported that its president had violated the company's rules on insider trading by buying stock in three Maryland bank companies while UVB was purchasing stock in two of those firms.

Regardless of the reason for discontinuing the talks, it's obvious that Allied Irish doesn't plan to play as big a role in First Maryland's "stability in motion" strategy as had been thought. Allied Irish seems more interested at the moment in recapturing a big part of its investment in First Maryland.

With a substantial downturn in the performance of its insurance subsidiary, Allied Irish apparently is prepared to forego a greater stake in first Maryland in favor of a sizable capital gain.