Ruth Rider Inc., a women's discount clothing retailer that operates the Sassafras chain, has filed for bankruptcy court protection from creditors.

The privately owned Gaithersburg-based company runs 26 Sassafras stores throughout the region, mostly in strip shopping centers.

In a Chapter 11 filing at the U.S. Bankruptcy Court in Rockville earlier this week, Ruth Rider estimated that it had $9.4 million in debts and $9.1 million in assets. The largest debtor was Maryland National Bank, which was owed $4.3 million. The business, which has operated in the area since 1961, has about 450 other creditors.

The store's main customers are women attracted by youthful, discount-priced brand name merchandise, mostly sports and office clothing. It is a family operation of medium-sized outlets run by Michael Rider.

Officials of the company, which employs 450 people, blamed the financial troubles on overexpansion, slower sales due to the generally lackluster retail climate and a reluctance by banks to provide additional short-term funding.

Ruth Rider's recent expansion of the Sassafras stores into the Tidewater and Richmond regions of Virginia proved disastrous, creating a huge financial drain on the company just as consumer spending in the Washington area flattened out, a spokesman said.

"Sales in August, September and October were off considerably," said the spokesman, who asked not to be named. "We just could not sustain what we had built." The chain's aggressive expansion came mostly in the past five years.

The company decided to file for bankruptcy protection when banks indicated that they were unwilling to extend further credit to allow the company to weather the diminished cash flow from operations, the spokesman said.

Ruth Rider officials said stores in outlying Virginia areas would likely be closed and the company would reorganize with 15 stores, primarily in the immediate Washington area.

"Once we get through this, we are determined to have a viable business, and we are trying to save all the jobs of our workers in the D.C. area," said the Ruth Rider spokesman.

The problems of Sassafras are similar to those of other local retailers. Garfinckel's, Arthur Adler, Fantle's Drug Stores and Stern's Office Furniture have gone out of business or declared bankruptcy due to the area's economic downturn.

"Like so many others, Sassafras expanded a little too much and then when the retail scene tightened up, they became a victim of the banking crunch," said one of the store's landlords. "Unfortunately, it's becoming an old story around here these days."