A stink from New Jersey

16 Jan 2007 By Antony Currie Follow @AntonyMCurrie

The Fed and the OCC are investigating deals involving the New Jersey bank s board, executives and others. It might be old news. Commerce details a ton of deals in its proxy. But fears the regulators have found something new might keep investors away from the stock.

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Commerce Bancorp has fallen under the scrutiny of two of its regulators, the Federal Reserve and the Office of the Comptroller of the Currency. The New Jersey bank announced that the two institutions were investigating matters including but not limited to transactions involving its officers, directors, and related parties, including transactions involving bank premises.

Vernon Hill, Commerce Bancorp's founder, chairman, and chief executive, is part owner of a realestate firm that leases land used for 17 of the bank's branches. Last year the bank paid $1.3m for the land. Hill is also a principal owner of Galloway Golf Club, which received $482,000 in business from the bank last year. His wife, Shirley Hill, owns a company that provides architectural, interior design and furniture advice to Commerce. The bank has been using her firm's services for more than 25 years, and last year paid a total of $7.5m.

All of these transactions are detailed in Commerce Bancorp's most recent annual proxy statement, as are similar transactions in previous years.

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