BALTIMORE — Edward J. Kelly 3d, a lawyer turned investment banker, has advised banks big and small on mergers and acquisitions for more than a decade.

As the new president and chief executive officer of Mercantile Bankshares, the former head of global financial institutions at J.P. Morgan & Co. plans to draw on that experience to build the $8.9 billion-asset super community banking company through acquisitions.

Mr. Kelly, who was named last week as the successor to longtime CEO H. Furlong “Baldy” Baldwin, is familiar with the trends in Mercantile’s markets and said he is confident there is growth opportunity for Maryland’s largest independent bank.

“It’s still a very fragmented industry out there, particularly in the middle Atlantic,” he said in an interview at Mercantile’s offices last week. “There may be some things we can do on that front.”

Though Mr. Kelly has advised on community-bank deals, he has worked mostly on larger ones and was intimately involved in his own company’s $33 billion merger with Chase Manhattan Corp., which closed the last day of December.

Mr. Kelly, who joined J.P. Morgan in 1994, said he was first approached by Mr. Baldwin a couple of years ago but did not start thinking seriously about the job until the Chase deal was announced.

“Given the change at Morgan in terms of the merger, I decided now would be a good time to think about doing something different, and Baldy was able to persuade me to come down here,” he said.

David West, an analyst at Davenport & Co. LLC in Richmond, Va., said the investment banker probably was chosen because it was thought he’d be more aggressive than Mr. Baldwin in building the franchise, given his background. Plus, with Mercantile’s stock trading at 2.5 times its book value — TK at midday Wednesday — he has the currency to do so.

Mercantile, whose focus is commercial lending, is one of the strongest and most profitable banks in the country, with a return on assets of 2.09% and more than 20 years of consistent earnings and dividend growth. Mr. Kelly said he hopes to sustain the streak his predecessor has led.

“My principal objective is to make sure I do at least as well as — and no worse than — he has done, because if I do that then I will be doing extremely well,” said Mr. Kelly, who takes the helm March 1. He will also become chairman and CEO of the company’s lead bank, Mercantile-Safe Deposit and Trust Co.

Twenty years after he joined the bank as a clerk, Mr. Baldwin became CEO in 1976, when Mercantile owned 10 banks and had assets of $783 million. Today it is a holding company for 22 community banks in Maryland, Delaware, and Virginia. The 69-year-old had planned to retire at 65, but, unable to find a successor, agreed to stay on “until we got this thing right.”

“We’ll forgive” Mr. Kelly “for being a lawyer,” joked Mr. Baldwin, who will stay on as nonexecutive chairman for three years. “He’s just dynamite.”

Though his successor lacks traditional banking experience, he is “a superb manager and a superb banker,” Mr. Baldwin added. “We’re not flogging retail products. Our whole thing is a value-added relationship with our customer,” which he said Mr. Kelly understands. “He doesn’t happen to know this community, so I think we can be helpful to each other on that.”

After 45 years with Mercantile, Mr. Baldwin said, it will be easier to leave now that Mr. Kelly is in place.

“We’ve had a good run,” he said. “I love this bank, and this is the right guy to take it forward.”

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