In his first public comment on the subject, National Commerce Bancorp. chairman Thomas M. Garrott told shareholders that recent rumors that he would sell his company are "false."

"It appears that someone was attempting to preempt our regular strategic review process; however, any such effort would be unsuccessful because our employees, management, directors, and directors emeriti own 45% of the company," Mr. Garrott said in a letter to shareholders dated October 1998 that was reproduced in a report issued last week by Salomon Smith Barney.

In July, rumors surfaced that National Commerce, a $5.5 billion-asset banking company, had enlisted Goldman, Sachs & Co. and Morgan Stanley Dean Witter & Co. with an eye toward selling. A sale never materialized, in part because National Commerce-whose stock traded at 27 times earnings at the time-would have been such a costly acquisition, analysts said.

National Commerce declined to comment on the rumors until last month, when chief financial officer Lewis E. Holland said his company routinely hires investment bankers to review strategy.

"Continuing top-tier success does not lend itself to sudden changes in strategy," Mr. Garrott wrote. "Media reports aside, our direction has not changed."

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