Sterling Bancshares, Houston, plans to buy $78 million-asset Clear Lake National Bank in a stock-for-stock transaction. The terms of the deal were not disclosed.

Sterling, a $1.2 billion-asset bank holding company, plans to acquire Houston-based Clear Lake by the end of the second quarter.

The deal includes Clear Lake's two Houston branches and its San Antonio branch.

George Martinez, Sterling's chairman, said Clear Lake was attractive because it is home to many small owner-operated businesses, a segment Sterling targets. "The growth prospects for this area fit with our strategic plan," he said.

Sterling had approached Clear Lake twice before, but got the deal only after offering a stock swap instead of cash, said J. Downey Bridgwater, Sterling's president. "No one wants cash anymore," Mr. Bridgwater said.

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