Like most people in this city on the shore of Lake Erie, James Cleave, the chief executive of Marine Midland Bank, is in no hurry.

Though $23 billion-asset Marine Midland, the U.S. banking subsidiary of London-based HSBC Holdings, has the size to be a more acquisitive presence in its home turf of western New York State, Mr. Cleave has been in no rush to gobble up other institutions. When acquisitions have been made - such as last year's announcement to purchase $7 billion-asset First Federal Savings, a Rochester thrift - Marine Midland has met its own exacting standards on price.

Indeed, Mr. Cleave, 58, wouldn't consider paying more than two times book for a bank or thrift.

Asked why, the earnest CEO responds, "We are constrained due to our heritage."

In fact, given the constraints on what Mr. Cleave can pay, some analysts wonder if Marine Midland will ever be in a position to make a major acquisition.

They noted that acquisition prices for banks and thrifts have been steadily rising, and takeover candidates are harder to find.

Some speculated Marine Midland lost out on the chance of a lifetime when it failed to ante up when National Westminster sold off its U.S. unit to Fleet Financial last year.

But there's such admiration in their scolding. Marine Midland may have something to teach the rest of the industry about the benefits of moderation.

"They have looked and kicked the tires at a large number of possibilities, and my impression is they will continue with this discipline," said Fred DeBussey, an analyst with Fitch Investor Services in New York.

"Right now I think that it is the feature characteristic of the bank's culture, that it won't take any sizable risks," said Richard Coleman, banking analyst at Merrill Lynch in London.

Behind his wire-rimmed glasses, Mr. Cleave reaffirmed the inherent caution of Marine Midland's parent company to make acquisitions.

"As an organization, and one of the top-performing banks in the United States, we need to relay the top return to our shareholders. We want to make money, and we want to make it intelligently through managing it appropriately and controlling the risks," Mr. Cleave said.

HSBC, Marine Midland's parent company, returned 21.20% on equity in the first nine months of 1996, up from 17.37% in the year-earlier period. Net income was $276 million, up 26%.

Analysts have long maintained that Marine Midland will eventually fill in the gaps in the western New York market, like Buffalo and Rochester.

But Mr. Cleave counters that he is in no hurry.

He said it would be an "opportunistic event" in 1997 if Marine Midland acquired anyone at all. In 1998 and 1999, he added, Marine Midland may renew its search in New York and contiguous states, such as New Jersey, Pennsylvania, and Connecticut.

"But that has yet to be decided," he said.

Analysts said Marine Midland's inherent caution is likely to continue. "It is, to a certain extent, inevitable that Marine has made some aggressive rationalizing on their acquisition candidates," said Coleman of Merrill Lynch.

Nevertheless, Marine Midland has hardly been sitting still over the last few years. Mr. Cleave said the bank's hands are full in 1997 with the assimilation of the branches of First Federal Savings. That deal is to close this month.

Moreover, last August the bank announced that it had agreed to buy J.P. Morgan's Newark, Del.-based institutional U.S. dollar clearing house business. The purchase was completed Dec. 31. The Morgan unit will combine with HSBC Financial Institutions, Marine's own clearing house division.

Terms of the J.P. Morgan transaction were not disclosed, but Mr. Cleave said it would double its dollar clearing values and volumes, adding to its correspondent banking business with 700 new clients, including banks and securities brokerage firms.

But it is the First Federal Savings acquisition that stands as a model for the type of purchase that Marine Midland likes.

The deal, which was also announced in August, was valued at an inexpensive 1.55 times book value, analysts said, or $620 million in cash, for the $7.2 billion-asset First Federal.

With the acquisition, Marine would incorporate the thrift's mortgage banking business, which included 15 origination offices in nine states. It also has the potential to originate $2.2 billion in loans in 1996.

Already, Marine has built a considerable mortgage business, now at $1.8 billion in residential originations in 1996.

In 1993 it originated $1.7 billion in mortgages. The next year it bought Buffalo-based Spectrum Home Mortgage Corp., which had a mortgage servicing portfolio of $700 million.

Heading south to Watertown, Marine acquired United Northern Federal Savings Bank in 1995 and from its own parent six branches of Hong Kong Bank in New York City. And last July the bank completed the purchase of East River Savings Bank in New York.

In a consolidating industry, Mr. Cleave said, the challenge for regionals with $15 billion to $25 billion of assets is keeping up with leaders in bank technology.

Marine Midland's closest competitors, which also have large parent companies, said they were not concerned with Mr. Cleave's advantages with capital and other resources.

"We look at our competitors on a broader base, which includes the entire financial services arena," said Linda P. Duch, Buffalo district president at KeyBank, a unit of KeyCorp. "We are a substantial player, and we are seeing changing needs in the Buffalo area."

Robert E. Sadler Jr., president of First Empire State Corp.'s M&T Bank, said that in the last 10 to 12 years his $11 billion-asset bank "has had a consistent interest in the Buffalo and upstate New York area, as a leading bank institution," as its closest rivals in the region have not.

But Mr. Cleave has an advantage with HSBC's bank technology research centers in Vancouver, British Columbia, and in Buffalo, Hong Kong, and London.

These, he said, spread the technology costs throughout the global network.

"Each of these centers is stocked with people who are trained in R&D, developing new concepts and products already in existence," Mr. Cleave said. "If we need something developed, we don't need to do it (alone)."

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