Commerce Bancorp in Cherry Hill, N.J., has announced plans to buy two insurance agencies for $12.8 million.

The $2.6 billion-asset bank is the first in the state to take advantage of a U.S. Supreme Court ruling last March that affirmed banks' authority to sell insurance from towns with fewer than 5,000 residents.

The agencies - Buckelew & Associates in Toms River and Keystone National Cos. in Cherry Hill - are to be housed in a new subsidiary of its Commerce Bank unit, called Commerce National. The deals are expected to close this fall, pending approval from the Office of the Comptroller of the Currency.

"We will use these acquisitions as the first step of a wider expansion into insurance," said Vernon W. Hill 2d, the banking company's chairman and chief executive. "This is the emerging trend in the banking business."

The agencies generate a combined $7.5 million in annual commissions on sales of property and casualty, automobile, and business policies, Mr. Hill said. He said he is on the prowl for a life insurance agency to round out the product line.

Joseph Buckelew, who owns Buckelew & Associates, was named chairman of Commerce National, and George E. Norcross, Keystone's chairman, was named president and chief executive. Neither could be reached for comment.

Stock analysts who cover Commerce Bancorp were not surprised that Mr. Hill would jump ahead of competitors to gobble up insurance agencies.

"What you have here is an entrepreneur who is always scanning the environment looking for opportunities," said Elizabeth Summers, an analyst at Ryan Beck & Co. in West Orange, N.J.

In addition to running Commerce, Mr. Hill owns a real estate development firm, a fleet of Burger Kings, and a home heating oil company.

Innovative thinking has been the key to Mr. Hill's success, Ms. Summers said. As evidence, she points to an aggressive expansion of brick and mortar, while many other banks are closing branches. He continually sees increases in his deposit base, she said.

Unlike many other banks, Mr. Hill has steered clear of working with third-party marketing firms, which supply agents to banks. These agents generally don't arrive with a book of business.

"The other guys want to train people, put them in branches, start up from scratch," he said about his competitors. "Maybe that's the way to do it. But we're doing serious volume on day one."

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