You have to wonder whether banks are following the savings and loans. A new congressional study warns that bank failures will exhaust the funds of the Federal Deposit Insurance Corp., which insures deposits up to $100,000 -- by 1993. Citicorp, the nation's largest bank, will cut its work force by 4,400 and its dividend by 44 percent. Many banks are doing the same. Will banks become a mega-mess like the S&Ls?

Well, no -- at least not yet.

Listen to banking analyst Charles Cranmer of Shearson Lehman Brothers: "The banking industry in no way resembles the thrift industry in 1986. The parallel isn't even close." By that, he means that banks face lower loan losses than thrifts and that they have more capital and reserves to cover the losses. Treasury Secretary Nicholas Brady says the same thing and cites banks' capital (mainly shareholders' investment) of more than $200 billion and bad loan reserves of $50 billion.

Guess again, though, if you think that the banks aren't in trouble. The conclusion of Cranmer and others is that the industry is seriously sick. So you'll be hearing plenty about banks in 1991. Consider the major problems:

1) The Bailout Problem: The new congressional report estimates that losses from bank failures will cost the FDIC between $19 billion and $43 billion over the next three years -- and perhaps $63 billion in a deep recession. By contrast, the FDIC will have about $28 billion to spend through 1993. However, the agency says it can avoid a bailout requiring taxpayer money. The FDIC gets its funds from insurance premiums of 19.5 cents per $100 of deposits, paid by banks. It expects to raise another $25 billion by increasing banks' payments.

2) The Credit Crunch Problem: The worry is that as banks suffer losses, they'll reduce lending and worsen the economy's slump. Loan losses can squeeze lending by depleting a bank's capital. Suppose a bank has $5 of capital for every $100 of loans. That's a 20-1 ratio. Now assume that the bank's capital drops by $1 to $4. The bank would then have to cut its loans from $100 to $80 in order to keep the 20-1 ratio. This is a problem, but it doesn't automatically create a credit crunch. Borrowers can turn to healthy banks for loans.

3) The Deposit Insurance Problem: It's the basic ill, say critics. It enables poorly managed banks to attract funds -- because depositors know they're protected against losses -- that managers waste on bad loans. In 1991 Congress will consider proposals to reduce deposit insurance by, say, limiting everyone to one insured account. In return, banks want Congress to allow them to enter new businesses (such as selling securities or insurance) and to branch across state lines. These changes, banks argue, would improve profits.

The choices for Congress and the White House are all messy. Dramatically curtailing deposit insurance could trigger panicky withdrawals -- and some unnecessary bank failures. And there's no quick way to improve the industry's profitability. A majority of states now allow banks from other states to buy local banks. Permitting truly nationwide banking might create further efficiencies, but the savings would occur slowly. Finally, the FDIC's plan to raise banks' insurance payments also involves risks. Some weak banks, unable to pay a big increase, might go bust.

What's killing banks now are bad loans on office buildings and other commercial real estate. Delinquent and foreclosed real estate loans total $49 billion. In addition, losses on consumer and business loans are rising, as they typically do during a recession. Most of the 12,399 banks have ample capital and reserves to cover higher losses. But some banks (including big ones like Citicorp and Chase Manhattan) are thinly capitalized.

A lot of these bum loans can be blamed on incompetence. Even in 1984, the national office vacancy rate was almost 17 percent. Many banks increased real-estate lending long after local markets were saturated. But the banks' basic problem lies elsewhere.

Thirty years ago, all financial institutions (banks, savings associations, insurance companies, brokerage houses) had protected markets. Banks, for example, lent to businesses and had a monopoly power to provide checking accounts, which incidentally paid no interest. Savings associations made home mortgages and offered passbook accounts. Everyone had captive sources of funds and borrowing markets. Interest rates were low and stable. The business of borrowing and lending was simple and fairly safe.

Not anymore. Interest rates are high and volatile. There are money market funds, and all institutions must compete for deposits. Lending markets are splintered. Many blue-chip corporations now bypass banks and borrow by issuing commercial paper (corporate IOUs, which are typically bought by other corporations or money market funds). Essentially, these changes were driven by inflation and new technology. Inflation raised interest rates, and electronics made transferring money easier. Deregulation -- the end of ceilings on interest rates, for example -- was virtually inevitable.

It's easy to forget now the huge benefits of all this new competition. Savers get higher interest rates, and borrowers get more choices. But the competition has shattered the financial services industry. It's squeezed profits, pushed financial institutions into unfamiliar markets and forced them to take more risks. For example, many banks have tried to offset the loss of good business borrowers by expanding real-estate lending.

The savings and loans are the first example of an industry that couldn't adapt to these changes. The debacle is really the story of how federal regulators and the industry failed to find a new combination of rules and lending practices that would make most thrifts economically viable. In a broad sense, the banks are now going through the same process.

Consider the early prognosis gloomy, but not hopeless. Banks are bolstering reserves and cutting costs. Much will depend on the depth of the current economic slump. But don't dismiss the possibility that a mega-mess may lie down the road. The ominous warning from the S&L calamity is that the size of the problem was always underestimated.