The list of banks in Montgomery County will be expanded by one this September if Silver Spring entrepreneur Daniel Morse can raise the final $1 million to meet Maryland charter requirements and open The First Montgomery Bank and Trust Company.

Morse, an energetic 34-year-old bachelor who divides his time between Silver Spring and his family's Virginia tobacco farm, is hoping to persuade his business associates to purchase the remaining stock -- 19,100 out of the total 40,000 shares. About 5,000 mailings went out a week ago and Morse is confident the money can be raised. The new bank's 14-member board of directors, of which Morse is chairman, bought 20,100 shares for $1.2 million.

By fall, the long, narrow shell of office space he has rented on Colesville Road in Silver Spring will become a glass and wood-paneled bank and then, said Morse, "We intend to give existing banks out here a competition fit."

The project began in 1978, when former county executive James Gleason signed an executive order that would put $5 million worth of county certificates of deposit in minority-owned institutions. There were none in Montgomery County then, although the First Women's Bank of Maryland has since opened and is currently considering the county's offer.

Morse, active in Silver Spring business circles and the black community as president of his own financial consulting company, set out to create a minority-owned bank. "It was a dare, you might say," he said.

But he was quickly advised to shift direction. "The state banking commissioner asked me, 'What is a minority bank? You have checking accounts, savings accounts, everything others have. So what is a minority bank?'" said Morse.

Morse couldn't answer that question, so he dropped the idea.

"We are a bank. Period," said Kirk Hornbeck, president of the new bank and former vice president of Security National Bank in Washington.

The bank's directors come from all backgrounds and include prominent black doctors and lawyers, the owner of a funeral home, and J. Arthur Monk, wide receiver for the Washington Redskins.

"Investing in bank stock is not for everyone. It doesn't represent a fast return," said board member Roger Blunt, chairman of the board of Blunt Enterprises, Inc., a construction firm. Blunt said he felt it his responsibility as a businessman to promote an institution that, at least initially, is largely minority-based.

The competition will be tough, Morse acknowledges. "You want to know where the other banks in Silver Spring are?" he asked. "All I have to do is take a map and sprinkle red ink all over it. Competition's all around us." Ten savings and loan associations and 10 commercial banks primary service area.

The First Montgomery's organizers believe they will be successful for two reasons. One is that they intend to use their smallness to give more personalized banking service to their customers, to know everybody by name, and to invite them to free seminars on finance.

The second is that new banks, they believe, have a built-in advantage in that they do not have old long-term loan portfolios that are based on low interest rates. "The existing banks are caught in a profit squeeze," said Morse.

Charles Georgius, deputy to the state banking commissioner, agrees. "New banks are not saddled with some of the problems of existing banks," he said. "They can develop their loan portfolios at higher rates."