Compass Bancshares' move to acquire another community bank in Jacksonville, Fla., continues a strategy of building a presence in urban markets outside Alabama.

The deal announced last week to buy Enterprise National Bank would increase Alabama-based Compass' share of the Jacksonville deposit market to 7%. That would put it close to third-ranked Jacksonville Navy Federal Credit Union.

First Union Corp. and Barnett Banks Inc. control an overwhelming 60% of Jacksonville's deposits.

Garrett R. Hegel, Compass' chief financial officer, said the dominance of these two giants suits his Birmingham company just fine, because smaller players in Jacksonville can be more aggressive on pricing deposits or loans.

"We don't have a lot of customers at risk for repricing, so we can do things creatively and sort of ride under the umbrella of the big two," Mr. Hegel said.

Compass' strategy in Florida parallels its expansion in Texas. Compass, which has $10.8 billion of assets, has acquired 27 community banks in the Lone Star State since 1987, most in the urban centers of Houston, Dallas, and San Antonio.

Dean Witter analyst Anthony R. Davis said Compass' strategy of buying community banks is driven in part by sheer necessity. Both Florida and Texas have experienced so many bank mergers in recent years that very few sizable targets remain.

Compass has announced three acquisitions in Texas this year alone. Almost half its assets are now in Texas.

"You have to do what Compass is doing," Mr. Davis said. "If you can go in and take costs out at the rate of maybe 20% of the acquiree's expense base, and at the same time position your company for better growth, I think it makes a lot of sense."

Compass said it would acquire Enterprise National for between $35 million and $36 million in stock. The final price, which represents about two times Enterprise National's book value, would depend on the number of warrants and options exercised by insiders at the acquired bank.

Enterprise National has $163 million of assets, $143 million of deposits, and three offices in Jacksonville. This deal, combined with the acquisition of Jacksonville-based CFB Bancorp, announced in February, would give Compass $1.1 billion of assets and 36 branches in Florida - 23 of them in Jacksonville.

Mr. Hegel said Compass needed a critical mass of branches in Jacksonville to spread its overhead and advertising costs more efficiently. "If you're going to advertise product, you need locations for people to come into," he said.

Compass entered Florida in 1991 and spent the next three years building a presence in the Panhandle region, which is considered part of the southern Alabama market. But all four of the acquisitions Compass has announced in the Sunshine State since 1994 have been in Jacksonville, the largest urban market in northern Florida.

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