News of heavy insider buying of National City Corp. in the second quarter is fueling optimism that the stock is poised to resume its upward climb.

Executives bought large numbers of shares in May and June, when the company's stock price was high. Analysts said the executives may have been buying in anticipation of a share buyback or the sale of a private-label credit card business that would boost the share price even higher.

The share purchases were unusual in two respects. First, insider buying is rare among major banks; after a bull year in bank stocks last year, many executives at top banks have been selling shares. Second, insiders commonly buy shares when prices are low, not when the shares are near an annual high.

A bank spokesman said some of the insider activity could be explained by new requirements for employee stock ownership that were imposed in April.

Fred Cummings, a bank analyst at McDonald & Co., Cleveland, said the bullishness of National City's executives raises the possibility that they expect a near-term boost in share value.

"National City is doing a lot of the right things in terms of its business mix, and they may soon buy back more company shares or be exploring the sale of its private-label credit card business," Mr. Cummings said.

The bank acknowledged it is trying to sell this business.

Mr. Cummings estimated the private-label card portfolio could fetch $55 million. National City issues credit cards for other companies through the private-label program.

National City's stock price hit a low point this year in January and peaked in mid-May, just as the insiders began buying. In all, eleven insiders added more than 90,000 shares to their holdings in May and June, according to CDA/Investnet, a Fort Lauderdale firm that tracks insider trades.

National City's president, William Robertson, exercised options on nearly 104,000 shares and held on to one-quarter of them.

The company's vice chairman, Vincent Digirolamo, exercised options on 9,368 shares and held on to 27% of them.

Even more unusual was the case of a director, Robert Paul, who exercised options and purchased National City stock at the same time.

"This type of accumulation is rare - option exercising and open-market buying by the same insider - and is frequently correlated with higher stock prices down the road," said Robert Gabele, president of CDA/Investnet.

"National City shares, which enjoy a healthy Street following, have been in a steady uptrend lately," he added.

Mr. Paul bought 12,866 shares in early May at prices between $36.37 and $36.63. He also exercised options on 6,000 shares - and held on to all of them.

If National City were to sell its private-label credit card portfolio - which has roughly $500 million in receivables - it would be in line with recent moves, Mr. Cummings of McDonald & Co. said.

The insider buying began just after National City announced it would spin off part of its payment systems unit, a move that drew rave reviews from Wall Street.

Last month, the company's earnings came in higher than expected, leading many analysts to increase their projections for the bank's profitability.

Another bank that demonstrated insider bullishness was Trans Financial Corp., whose CEO, chairman, and president, Doug Lester, resigned June 5.

The shares, which had been trading at $15.50 at the time of the announcement, promptly rallied to $18.50 on the news. Insiders, who had been buying prior to the departure, continued to buy even after the stock surged.

Between April and June, five insiders bought a total of 49,501 shares at prices between $15.50 and $18.38.

Trans Financial was one of many southern banks demonstrating insider bullishness during this period. Trustmark Corp. and F&M National Corp. insiders as well have been active buyers of their companies' stock.

Among larger banks, insiders were generally selling rather than buying shares. William R. Rhodes, a Citicorp vice chairman, filed with the Securities and Exchange Commission last month to sell 125,297 shares.

Bank of New York Co.'s chief executive, J. Carter Bacot, exercised options on 30,440 shares and sold them on July 23, netting $1.5 million.

In trading Wednesday, bank stocks lagged the broader markets after generally outperforming for the last few weeks.

The Standard & Poor's index of major banks rose 0.48%, while the overall S&P rose 0.74%.

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