The changing of the guard at American Security Bank is complete now that Daniel J. Callahan III, chairman until just a week ago, has been stripped of his authority as chief executive of the District's second largest bank.

Operational control of the bank now rests firmly in Baltimore, where a new president has been named to run both American Security and Maryland National Bank, also a subsidiary of MNC Financial Inc. In naming former Maryland National Chairman H. Grant Hathaway president of both banks, MNC's chairman Alfred Lerner has put in place a new business structure for the bank holding company and its subsidiaries.

The new management and operational structure, which places greater emphasis on delivery of banking services and products and less on subsidiary banks as legal entities, is not uncommon but interesting, nonetheless.

That aside for the moment, the shake up in top management at ASB is a sobering reminder of a changing of the guard, not just at that bank, but in all of Washington banking. You might say it is indicative of substantial changes that have shaped the area's business community over the past 10 years.

The old Washington business establishment that held sway a decade ago has either retired to the sidelines or has been forced to compete in a vastly different environment. It continues to have some measure of influence but increasingly people outside of metropolitan Washington are taking control, amassing financial power and making market decisions affecting Washington business. The new order has arrived.

Callahan has been named vice chairman at MNC. In the vernacular of corporate corridor conversation, he has been "kicked upstairs" where his primary job will be attracting prestigious corporate customers.

A major figure in local banking since being named president of Riggs National Bank in 1976, he also has strong ties in national and international banking circles, having been a vice president at Chase Manhattan Bank in New York and in London.

As vice chairman in charge of bringing in big corporate accounts for MNC's subsidiary banks (American Security and Maryland National), he is expected to be what's known in legal circles as a rainmaker. Callahan is, as a spokesman for MNC told Washington Post staff writer Joe l Glenn Brenner, "a man of significant influence in the Washington business community." But under the new structure in which ASB will operate essentially as an affiliate of Maryland National, Callahan's influence won't be the same as it was when he was chairman and chief executive of American Security Corp. and American Security Bank, and before that, as president and chief administrative officer of Riggs National Corp.

Ten years ago, all D.C. banks were locally owned or controlled. In the interim, 11 of the top 14 have changed hands. Of those 11, four have been acquired by Virginia bank holding companies, two are now owned by Maryland institutions and one has been taken over by Middle East investors. The National Bank of Washington also was controlled by Middle East investors before it failed last year.

Clearly then, banking relationships that the local business community enjoyed before 1980 have changed and will continue to change. Callahan's changed status underscores that fact of business life. As chairman of American Security, he was the last link to a fraternity of local banking executives whose ties with Washington's business establishment went beyond banker-customer relationships to the camaraderie and exclusivity they enjoyed at the area's more prominent city and country clubs. They were part and parcel of the Washington business establishment that dined, played golf and did business together. Many of those social ties were the stuff of which business deals were made.

This fraternal bond is still an important factor in Washington business but decisions affecting trade and commerce in metropolitan Washington increasingly are being made by a new cadre and a new breed of executives. They manage the regional offices of major corporations. They own or manage the professional and business service firms which proliferated here during the economic boom of the 1980s. They're in charge of the high-tech companies and defense contracting firms that sprouted up around the Pentagon, NASA and the National Institutes of Health. They run the trendy and not-so-trendy retail stores that compete for market share today with established retailers such as Hecht's and Woodward & Lothrop Inc. And yes, they run the banks the way their parent organizations in Baltimore, Richmond, Norfolk, Atlanta and the Middle East want them run.

In separate conversations recently, two prominent members of Washington's business community bemoaned the fact that they couldn't think of many executives who were around and remember what it was like operating a business during the 1981-1982 recession.

This changing of the guard is reflected to some degree in The Greater Washington Board of Trade's election of officers for 1991. The board's president, William C. Harris, is president of Richmond-based Crestar Bank's greater Washington region. The board's president-elect and secretary are senior vice presidents, respectively, for government affairs in the Washington offices of American Telephone & Telegraph Co. and Northrop Corp.

The point is Washington business is no longer dominated by home-grown executives or those who came up through the ranks in local companies. On the positive side, that's one indication that the local economy is more diversified and more mature, albeit mainly in the area of business services. It remains to be seen, however, just how beneficial some of the changes will be for business, consumers and the local economy in the long run.

The change at American Security, which was inevitable, is a case in point. Though he helped engineer the merger with MNC, Callahan must have known it would happen sooner or later.

Analysts called the merger a "perfect fit." It was a marriage of near equals, they said, after the merger in 1987. Callahan and former MNC chairman Alan P. Hoblitzell not only had a high regard for each other but also had something the other wanted: MNC wanted a major position in the Washington market and American Security could provide that as a leading commercial lender and the District's second largest bank. American Security wanted a merger partner but wanted to retain a certain amount of autonomy which Hoblitzell was willing to give.

But with MNC and its banks reeling from the crash of the region's real estate industry, Hoblitzell resigned and the perfect fit came apart. It was only a matter of time before Callahan would be replaced as chairman of American Security which holds a major share of MNC's troubled real estate loans. Lerner, who replaced Hoblitzell as chairman of MNC, has his people in place now and American Security's marching orders will come from Baltimore.

That has major implications for the District because Callahan, while chairman of American Security, established an enviable record of consistency in his commitment to improving economically deprived areas of the city. A letter that Callahan wrote in 1985 to former D.C. Mayor Marion Barry and the city council embodied the type of commitment that current Mayor Sharon Pratt Dixon needs to help revitalize economically disadvantaged communities.

"I wish to put before you some new commitments, above and beyond what I consider to be the ongoing community responsive role that American Security has always played in this city," Callahan offered as a challenge to criticism of local banks. "I couldn't agree with you more," he continued, "that there are areas of the city more economically disadvantaged than others, and that there is a very real need to assist the start-up activities of small businesses that are going to domicile their ventures in the District.

"To that very important end, American Security is prepared to commit unlimited dollars. Let's not put a ceiling or a number on it. One hundred million dollars over three years may not be enough. That's only $30 {million} to $35 million per year. Let's commit to a concerted effort, involving your office and ours, to identify and surface all viable lending opportunities in the distressed areas" of the city.

The city obviously would lose much if that commitment is canceled with the changing of the guard at American Security.