Riggs National Bank today will announce a search for a new chief executive officer to replace Riggs's principal shareholder, Joe L. Allbritton, who has held that post for the past 11 years.

Allbritton disclosed the search for a new Riggs president and CEO in an interview this week. He will remain chairman of the bank and chairman and chief executive of its parent company, Riggs National Corp. Allbritton also will be a member of the search committee that will be named today at a meeting of the Riggs board.

The search is part of an effort to revive the District's oldest bank, which for generations has been a pillar of the city's business establishment.

In recent years it has been hit hard by real estate loan losses and other management problems, losing about $140 million in the last three years, and has lagged behind many of its competitors in recovering.

The move to seek a new chief executive officer comes as federal regulators are pressing Riggs to take steps to bolster its management and restore its financial health. The Office of the Comptroller of the Currency urged the appointment of a new president and CEO as part of what industry sources said was a highly critical examination of the bank last fall.

Allbritton said that after several years of disappointing financial results, the bank is listening to regulators -- and taking the steps it feels are necessary to survive.

"We are trying to change the {bank's} culture," he said in an interview earlier this week in his office high above 17th and H streets downtown. "It is not easy. But in modern times, it is imperative to doing well in the future."

Allbritton said the search has focused on four candidates, all professional bankers from outside the Washington area.

The Riggs presidency has been vacant since July, when Ray M. Williams left the bank after only five months in the post. Williams was never elevated to CEO, a post Allbritton has held continuously since 1982. The change will not affect Allbritton's control of approximately 34 percent of the holding company's stock.

The decision to place someone other than Allbritton -- the personification of Riggs and a leader of the Washington business community -- at the helm is emblematic of a larger struggle underway inside the 157-year-old bank as it seeks to recover from the real estate reversals of the last few years.

Riggs has not yet shared in the profit recovery of the banking industry regionally and nationwide. National figures are still being compiled, but 1992 is likely to be the best year for U.S. bank profitability since 1936. Yet Riggs reported a loss for the year, and an especially bad fourth quarter.

Riggs National Corp., which owns the Riggs Banks of the District, Virginia and Maryland, lost $22.79 million in the fourth quarter of 1992, compared with a profit of $2.10 million in the same quarter last year. Overall, it lost less in 1992 than it did in 1991 -- $19.8 million compared with $63.5 million. But the loss comes against the backdrop of vastly improved bank fortunes nationwide, thanks mainly to interest rate spreads that allow banks to obtain money cheaply and turn handsome profits on loans and investments.

Riggs National had about $307 million in nonperforming assets -- bad loans and foreclosed-on properties -- at the end of last year, down about $70 million from the previous year. The bank set aside $23 million for bad loans in the last three months of 1992, up from $5 million in the last quarter of 1991.

An institution that once seemed as immutable as the national monuments has thus been forced to seek radical solutions. As Allbritton described it, the revolution is proceeding on two fronts -- various outside consultants have been called in to reshape the bank's procedures and structure; and Riggs is about to begin an aggressive program to get back into the business of making loans, which it has done very little of in the last few years.

Three outside firms are involved. The accounting firm of Ernst & Young recently devised a plan to help Riggs comply with regulatory requirements. And about a month ago, the Washington-based Secura Group reported to the Riggs board on the bank's organizational structure and management.

Close on the heels of the latter study came the resignations of two top executives with long Riggs tenures: Frank L. Langhammer III, executive vice president for corporate and commercial banking; and Walter A. Howell, executive vice president for retail banking. Industry sources said the resignations were involuntary.

Now getting underway at Riggs is a study by the New York consulting firm Tandon Capital Associates Inc., whose specialty is restructuring bank operations and cutting costs. Tandon is known for its work last year for the troubled Midlantic Corp., a New Jersey-based bank holding company. The Tandon study recommendations, now being implemented at Midlantic, will result in the loss of about 2,000 of 7,500 jobs at the company.

Riggs has said Tandon's study will probably mean staff cuts, though less drastic than those at Midlantic. Tandon, whose study is expected to be finished around the end of April, relies mostly on bank staff to propose cuts.

Allbritton, formerly a Texas banker, is known to relish the power he has enjoyed at Riggs since he took the institution over in the early 1980s. But he said that Chandrika Tandon, the 38-year-old president of the highly regarded consulting firm, "has total access to me at all times," and that "the study has my absolute, full support because it will permit us to target levels of expense." He added: "It is not a head-rolling exercise. It is to redefine how every person in the bank can better serve customers, and it is not just to let people go."

Riggs's high expenses, the focus of the Tandon study, are a weakness that has been cited by those who closely follow the company.

"Riggs has unusually high overhead," given its relatively low level of lending, said Rockville banking consultant Arnold Danielson. Danielson noted that Riggs's net operating expenses for 1992 exceeded its interest income -- an indication of high overhead costs.

Riggs, which has cultivated its image as a bank with well-heeled and powerful customers, traditionally has gone first-class in management perks, office appointments and other costly items.

"There is no sacred cow. No one is sacred," Allbritton said, noting that he has proposed "at least eight or 10" suggestions of possible cuts in "expenses that aren't warranted, that don't produce any goods and services for the customer." He would not elaborate.

Even before the study's results are in, Allbritton is proposing at least one top-level cut. The boards of the District Riggs bank and the holding company are expected to discuss at their meeting today a plan to consolidate themselves into one 25-member board, which Allbritton said will mean dropping about 12 directors.

In describing this move, which he said he first raised with the board last September and was included in the Secura group's recommendations, Allbritton specifically noted the savings of about $500,000 a year that would result from having to pay fewer directors' fees and expenses.

Meanwhile, Allbritton said Riggs is about to embark on a new campaign "to begin lending aggressively in the Washington area." He said the effort will focus on residential mortgages, business loans to middle-sized businesses and lending in "the less advantaged Washington neighborhoods."

"We've got money coming out of our ears. ... We've got $2 billion that we could put into loans at this time," he said. He would not specify how much the bank plans or aims to lend through this program.

A successful effort might help Riggs return to profitability. It could also serve to refocus the corporation on its role as a Washington-area banking institution, which some observers say it lost touch with as it expanded internationally in the 1980s. Riggs's subsidiary bank in London, purchased a few years after Allbritton took over, is now a major drag on bank income, as a result of bad corporate and real estate loans and the British recession. Allbritton said Riggs is "reevaluating" the British bank's role in the larger corporation.

"I think Riggs should continue as a local bank, locally owned, a regional bank and independent," Allbritton said, referring obliquely to the outside banks such as North Carolina-based NationsBank Corp. that have moved into the Washington area in recent years by purchasing area banks.

It remains to be seen if the efforts to transform Riggs into a leaner, more modern bank will return it to its old luster. "They've got such wonderful name recognition," said Danielson. "And to allow all these changed-names and non-names to bury them is practically criminal."

"Are we out of the woods? In no way," Allbritton said, but he added: "I think you'll see from midyear on a definite trend of improvement at the Riggs Bank."