If the 55 Utah banks can be compared to a ship, in the mid-1980s it was leaning a little to the starboard. But in 1989 and 1990, after some changes were made, the ship is once again on an even keel and Utah banking is in good condition.

This assessment of Utah banks comes from Jim Timmel, director of the Salt Lake field office of the Office of the Comptroller of the Currency, who said that banks changing their lending criteria have helped right the ship.Speaking to a recent meeting of the Utah Chapter of the National Association of Industrial and Office Parks, Timmel showed figures showing that in the mid-1980s Utah banks, generally, were below the national average in two important categories by which banks are judged.

Referring to return on assets, Timmel said a good figure is 1 percent, but Utah banks in the mid-1980s had only 50 percent of that total. However, the figure improved in 1988 and 1989.

Another part of the criteria is net loan losses to average assets and in the 1986 Utah banks had 1.3 percent and that increased to 1.5 percent in 1987. Timmel said a good figure was 0.25 percent. However, the Utah bank figure dropped to 0.8 in the last three years and could even drop to 0.5 in the future, he said.

In the mid-1980s, Utah banks were below the national average in return on assets and and higher in net loan losses to average assets, but thanks to a more conservative lending policy those figure have been reversed and Utah banks now are better than the national averages.

George Hofmann, senior vice president of commercial real estate for Zions First National Bank, said that because of massive losses in recent years, banks have changed their lending criteria and looking at different items when making loans.

For example, banks are looking more extensively at the primary source of repayment and trying to understand the borrower. In the past, he said, lenders looked at a few statements but didn't examine cash flow and look at the borrower's ability to handle all debt, not just the debt on the bank's loan.

Hofmann said banks are looking more closely at market trends, the type of business, the length of terms for tenants in buildings.He calls it "credit sanity."