When Riggs National Corp. Chairman Joseph L. Allbritton is host for lunch in the corporate dining room, he sometimes apologizes to taller guests for the table and chairs, which he says were cut down to accommodate his shorter frame.

"You're here once in a while. I'm here all the time," a visitor recalls Allbritton saying.

A Riggs spokesman says the bank's furniture is of regular size and that Allbritton, whose height has been estimated to be less than 5-foot-4, must have been joking. Still, several banking industry analysts and executives say the story symbolizes Allbritton's business style: He molds the world to his standards rather than conform to marketplace demands.

For Riggs National Bank, the Washington corporation's major holding, the result is a financial return that analysts describe as less than spectacular for a financial institution that basks in the middle of one of the nation's richest markets.

Riggs may be the biggest bank in Washington, and Washington may be the most important city in the world -- as the bank's ad campaign boasts -- but to Wall Street, the bank is no big deal. After six years with Allbritton as its major shareholder, analysts say, Riggs is a healthy but ultimately mediocre performer that is being outpaced by its regional competitors in Virginia, Maryland and North Carolina.

Like the man who runs it, Riggs is a loner. It does not follow business fashion or run with the crowd. Occasionally, that has put the bank on the cutting edge -- as in November, when it lowered its prime lending rate a day before the big New York banks reduced theirs.

But more often Riggs and Allbritton go it alone -- not in breaking new ground, but in following a conservative, and often less profitable, course.

While other banks have scrambled to grab consumer and commercial loans in the fast-growing Washington market, Riggs' push for new loan business has been understated and slow. Allbritton continues to put a large portion of the bank's cash into safe but less-profitable investments, such as government securities.

And while many of its local competitors have been taken over or are courting potential suitors, Riggs insists it intends to remain independent. It has acquired small banks in Maryland and Virginia -- and recently made an abortive bid for a bank in Florida -- with the intention of building its presence over time in those markets. But unlike its competitors, Riggs made these moves with a minimum of media splash.

Blame and praise for the bank's performance falls on Allbritton even more squarely than it would most executives. The former owner of the Washington Star has a reputation for taking an active role in nearly every aspect of businesses he controls. Riggs -- of which he owns 5 million shares, or 36 percent -- is no exception. Since Allbritton took control of Riggs, the company and its chairman have become indistinguishable to many observers.

Allbritton's management style may be conservative and old-fashioned, but Riggs spokesman David Palombi said, "Is Allbritton's style outdated? I don't think it is.

"Quality, liquidity, profitability -- Allbritton wants to take them in that order," said Palombi, the only person Allbritton would allow to speak for Riggs or himself for this article. "It's a slow way to grow, but down the road you have a more solid organization."

"At Riggs, we realize the advantages of steady long-term growth," Allbritton said in the latest quarterly report to shareholders. "To achieve this, we concentrate on the basics -- taking deposits, cashing checks and making loans. It is a philosophy that has enabled {the bank} to survive seven major financial crises during the last 150 years."

Banking industry analysts are not so impressed, however.

"Judging from a review of the company's performance-and-quality statistics ... Riggs' fundamentals remain spotty," Keefe, Bruyette & Woods Inc., the bank consulting firm, said in a report last May.

"On the positive side, asset quality, reserve coverage and capital ratios are quite strong," said the report, Keefe Bruyette's most recent study of Riggs. "Profitability, on the other hand, remains unimpressive."

Although the report is seven months old, Keefe analysts say they know of nothing that would substantially change its conclusions. Several other securities firms that follow Riggs say substantially the same thing about the bank.

A survey of the area's top 25 banks by Wheat First Securities of Richmond shows Riggs ranked lowest in return on assets and return on equity -- two widely used measures of bank profitability -- for the three months ending Sept. 30. Its figures were nearly half the industry average.

Analysts say that the key reason Riggs' profits are lower than competitors is that Allbritton insists on keeping a higher-than-average portion of the bank's money invested in government securities. The bank now has 53 percent of its earning assets in nongovernment loans, compared with 70 percent for banks of comparable size in surrounding states.

That keeps the bank's risks low and gives it the ability to convert investments to cash quickly. But government securities, because they carry little risk, also provide a lower interest rate than other, more risky investments, such as loans to consumers and corporations.

Riggs would be increasing its risks slightly by lending more money outside the government, but its profits also would be higher, analysts argue.

Allbritton isn't frantic to please the analysts the way most bankers are. Palombi said the chairman is content with earnings that have grown 15 percent a year for the past four years, even though that record will be disrupted this year.

Riggs will report a loss for the three months ended Dec. 31, compared with profits of $6.7 million during the same period last year, largely because of losses from loans to South America. The bank's 1987 profits are expected to be "slight," and certainly will drop sharply from the $35.6 million it earned in 1986, Palombi says.

Allbritton's preference for investing in government securities enabled Riggs to pay cash to buy banks in Virginia and Maryland this year, despite the anticipated decline in profit, Palombi said. Ready cash also will enable the bank to open 11 branches next year in the Virginia suburbs alone, he said.

And it offers greater protection against a rise in bad loans should there be a recession. "That's not to say we're sitting around expecting a recession," Palombi said, "but we're prepared for one if it happens."

Many analysts and competitors also criticize Allbritton for an overbearing style that requires too much say in the bank's day-to-day operations. Several former employes, who agreed to be interviewed only if their names were not used, said Allbritton's attention to detail makes it hard for many officers of the bank to act quickly on loan requests, meaning many decisions have to await Allbritton's approval.

"Allbritton's imprint is certainly here," Palombi conceded. "But in terms of execution, this place is more decentralized than people realize."

Since 1981, when Allbritton took over at Riggs and became its largest shareholder, he focused on whittling down the bad debts he inherited with the bank, Palombi said. The effort shows up in the bank's financial figures. Riggs charged off $27.1 million in bad loans in the five years from 1982 through 1986. In the five years before Allbritton arrived, only $880,000 was charged off, Palombi said.

Although Allbritton uses the quarterly report to tout a conservative approach he says the bank has followed for years, he blames the bank's practices under previous management for its current woes. "We're paying for what previous management left us," Palombi said.

Still, many other competitors that have suffered from troubled foreign loans have managed to keep profit ratios higher.

"I think the Signets and the Sovrans are much more geared to a moment in time," Palombi said of two of Riggs' Virginia-based competitors. "We're looking at the longer term and retiring the problems we inherited. That takes time and money." To keep growing, Riggs in recent years has moved away from its tradition as primarily a bank for local businesses and has sought to increase its share in retail and government markets.

Since 1984, its business with retail customers -- which includes consumers and businesses with assets of $5 million and less -- has increased threefold, Palombi said. The multimillion-dollar contract it won last month with the U.S. Treasury to act as a clearinghouse for electronic payments attests to the bank's success in winning more government business.

Despite such successes, many competitors wonder how Riggs will fare in winning new business in an increasingly crowded and competitive banking community. Many of the competitors say they are less worried about Riggs than about each other and the aggressive regional banks in Virginia and North Carolina.

Allbritton is known for the secrecy in which he has cloaked his bank -- a secrecy unusual even for the publicity-shy banking industry. He has shunned colleagues to the extent of dropping out of the lobbying group local bankers have formed. He gives no interviews, even though he owns a television station and newspaper in New Jersey.

Allbritton -- and Riggs -- maintain their arm's-length posture so effectively that speculation on what Allbritton may or may not do with Riggs has become a favorite pastime for local bankers.

Some competitors believe his claim that Riggs -- which so far has not been swallowed up in the merger mania that has gotten many of its competitors -- is not for sale. "It's the last large locally owned bank, and it's going to stay that way," Palombi said.

Others, however, speculate that Riggs' recent acquisitions in the suburbs, as well as its unsuccessful Florida venture, are Allbritton's way of staying competitive while awaiting an appropriate suitor.

Whatever Allbritton's long-term plan for Riggs, even critics of his style concede that he is likely to make money in the process. "He's a smart businessman," says a competitor. "No one doubts that."

But Allbritton's go-it-alone character may have hurt the bank by limiting its exposure socially to potential clients. He is notorious for avoiding the business and social gatherings that are de rigueur in banking circles for forging professional ties and making contacts that generate new business.

Palombi insists that Allbritton is not aloof, just very private. But his posture has made Allbritton the butt of derision from other bankers. Riggs' slogan -- "The most important bank in the world's most important city" -- has caused executives of more than one of its competitors to joke, "Yeah, and it's headed by the banker who thinks he's the most important banker in the universe."