Oct. 12--Scott Wallace is getting used to the fact that whenever he's running errands around town, he's going to get stopped by somebody with questions about the economy.

"It is the topic that everyone is talking about because what is happening now is something we've never seen before," said Wallace, Northwest Washington regional president for U.S. Bank. "I don't mind, though; it gives me a chance to talk about what's going on in our industry."

With everything that's happening -- whether it's Washington Mutual teetering toward collapse before being bought by JP Morgan Chase, or the now daily warnings from Wall Street and the government about credit freezing up -- bankers have been doing a lot of talking about the stability of financial institutions, whether it is at the neighborhood grocery store or in the branch office.

The concern continues to revolve around two questions: Is my money safe? Can I still get a loan? Bankers continue to assure clients that the answer is yes to both. Consumers could be heartened by the FDIC's decision last week to raise the insurance cap from $100,000 to $250,000, but convincing people they have money to loan has been more difficult.

A factor in Wall Street's tumble last week was concern about credit freezing for banks, but so far that involves the trading of commercial paper, which is different from credit that banks give to businesses or new homeowners.

The way it's described by many economists is there are several different faucets pumping money into the economy. The faucet where banks lend to each other is the one that seems stuck.

"We would love to make a loan; that is what banks do. Our criteria is not any different than it was a year or two ago," said Dennis Long, CEO of The Bank of the Pacific, headquartered in Aberdeen. "One of the biggest challenges is the consumer fears from the headlines they see. The term 'bank' gets used rather loosely, tying us to the toxic subprime loans that hurt investment institutions. We never made a subprime loan or purchased mortgage-backed securities."

Given the magnitude of last week's drop at the markets, however, concern is that other faucets will start freezing up. Because of this freeze potential, banks are going to focus on taking care of the customers they have now and not aggressively pursuing new lines of credit, said Don Zimmerman, president and CEO of Business Bank, which has branches in Whatcom and Skagit counties.

"We have to work with the capital we have, and not expect to be able to find credit from other areas until this liquidity issue is resolved," Zimmerman said.