Rising demand for commercial and personal loans and a decline in bad debts helped make 1985 a year of record earnings for two of the Washington area's largest banks.

*Maryland National Corp., the largest bank holding company in Maryland, said net income rose 48 percent to $73 million and earnings per share climbed 37 percent to $4.11 for the 12 months that ended Dec. 31.

The holding company, which owns Maryland National Bank, had net income in 1984 of $49 million ($3.01 a share).

For the fourth quarter of 1985, the company earned $19.9 million ($1.09) compared with $13.2 million (81 cents) for the 1984 period.

In addition to profiting by making more loans, the bank company said its net income was boosted by service and credit-card fees and from a growth in deposits.

*Riggs National Bank of Washington reported net income of $31 million in 1985, up 15.2 percent from $26.9 million in 1984. It said earnings per share were $5.18, a 15 percent increase from $4.49 the year before.

The gains came despite write-offs of $13 million in bad loans, more than twice the $5.9 million the bank wrote off in 1984. But the bank said its ratio of loan loss reserves to loans dropped to 1.42 percent from 1.6 percent in 1984, reflecting a greater percentage of healthy loans.

The bank said net income for the fourth quarter of 1985 was $7.3 million, an increase of 11.1 percent from the $6.5 million reported in the last quarter of 1984. Earnings per share increased 13 cents, or 10.6 percent, to $1.22. Riggs said that earnings were boosted by an increase in deposits, income from service fees and interest on loans.

*Gray and Co. Public Communications International reported a second consecutive quarter of earnings, with profits up 24 percent on a 34 percent increase in revenue for the three months that ended Nov. 20.

The Washington D.C.-based public relations and lobbying organization said that in its third fiscal quarter it earned $418,392 (17 cents a share) on revenue of $7.1 million compared with earnings of $336,724 (14 cents) on revenue of $5.3 million for the 1984 period.