Two years after interstate banking arrived in the Washington region, most of the assumptions, fears and predictions that preceded legislative approval of the new banking structure have been dispelled.

Big money-center banks haven't gained dominance in the region as many had feared when Phase I of interstate banking began. Little banks haven't been gobbled up as many had predicted. D.C. banks have been much less aggressive than many had assumed they would be in expanding beyond the city's boundaries. Consumers have yet to see many of the benefits that were supposed to flow from increased competition. On the other hand, several stockholders have done rather well as aggressive buyers paid surprisingly high premiums over book value for local bank stocks to gain entry to the market.

The realignment that has occurred in the region's banking industry is the one result that only the most ardent of interstate banking proponents predicted accurately. Strong regional banks have become the dominant players, making it more difficult for institutions outside the region to gain control.

Proponents of regional accords among states have maintained all along that reciprocal legislation authorizing mergers across state lines would give banks in the region breathing room to strengthen their competitive positions before the advent of national banking. The underlying argument, of course, was that the big money-center giants would be discouraged from taking over large regional banks if the latter were given time to consolidate their positions.

That goal essentially has been achieved in this region now. There are at least six bank companies that have achieved the asset size and market coverage necessary to reduce their appeal as takeover targets.

With the start of Phase II of interstate banking in the region on July 1, an obvious question is how it will differ from Phase I?

Phase II should provide more of the same with dominant banks based in the region improving their positions, according to Arnold G. Danielson, an analyst of bank industry trends, consultant and president of Danielson Associates Inc. in Rockville. In addition, says Danielson, there likely will be further intraregion mergers in the Middle Atlantic states as Pennsylvania and West Virginia become active players in reciprocal banking pacts.

As of July 1, banks in Pennsylvania may acquire Maryland banks under reciprocity agreements between the two states. West Virginia was included in regional reciprocal banking laws enacted initially by Virginia, Maryland and the District, but the start of interstate banking in West Virginia will be delayed until Jan. 1.

The involvement of Pennsylvania and West Virginia in an expanded regional market, Danielson believes, will buy Middle Atlantic states at least two more years of orderly transition before the national interstate banking phase begins.

In addition to those in Pennsylvania, bank holding companies in 10 states, mostly in the Southeast, may enter Maryland on a reciprocal basis, effective last Wednesday. Virginia and D.C. also have reciprocal banking arrangements with those states. Already, Charlotte's NCNB Corp., the largest bank company in the Southeast, has announced its merger with Centrabank of Baltimore after acquiring Prince William Bank in Dumfries, Va., last year.

In the meantime, says Danielson, who accurately forecast developments in Phase I, the six regional leaders in the mid-Atlantic area -- Sovran Financial Corp., MNC Corp., Signet (Bank of Virginia Co.), Crestar (United Virginia Bankshares), First American Bankshares Inc. and Dominion Bankshares -- will continue to consolidate their positions and "make it very difficult for outsiders to acquire them."

There will also be movement into the area "in dramatic fashion" of at least one, if not two, of the large North Carolina bank companies, Danielson maintains.

As for the potential for dominance by banks from outside the region, there seems to be little reason for concern at this point at least. An analysis by Danielson shows that New York's Citicorp, for example, ranks 30th among depository institutions in the region, based on the assets of its subsidiary in Maryland. Chase Manhattan Corp., which obtained special permission to operate a subsidiary in Maryland by buying a troubled state-insured savings and loan, ranks 45th in the region.

Other out-of-town banks such as NCNB and Pittsburgh's Mellon Bank don't yet rank among the region's top 50 institutions, according to Danielson's calculations.

Considering these and other critical factors in the development of interstate banking in the region, Danielson maintains, "it is safe to say that the local control of Middle Atlantic banking is almost certain to persist for a few more years. In fact, there is a good possibility that banks in the Middle Atlantic states will do more acquiring outside the region than outsiders will be doing in it."

What does it all mean for retail and commercial bank customers in the region? H. Furlong Baldwin, chairman of Baltimore's Mercantile Bankshares Corp.,probably said it best several months ago, referring to small businesses in the region: "Not one damn thing."