Summit Bancorp of Princeton, N.J., which has been purchasing independent insurance agencies in its home state, is looking for agency deals in the two other states with Summit bank branches - Connecticut and Pennsylvania.

"We're itchy," said Stewart McClure, senior executive vice president at $38 billion-asset Summit. "Although nothing is set in stone, we're being approached and we're approaching independent agencies all the time."

Summit has been active in New Jersey's insurance market to expand its product line, and says it intends to use the same strategy in its other markets. Heading the effort is Thomas Sharkey Jr., who came to Summit when it bought Meeker Sharkey Financial Group of Cranford, N.J., in January.

In May the company formed Summit Insurance Advisors, a consolidation of insurance brokerages including Meeker Sharkey, where Mr. Sharkey was chairman. The 300-employee company is the 15th-largest insurance brokerage in the country and the largest in New Jersey, said Mr. Sharkey, its chief executive officer.

Also included in Summit Insurance Advisors is Patgo Insurance Agency of Newark, N.J., which sells property and casualty and group benefits lines and has a foothold in the Hispanic community in Newark-Bayonne.

Summit will examine the sales lines of any insurance agencies it pursues, but that will not be the overriding factor in takeover decisions.

"We purchased one agency that did only employee benefits and then purchased a property and casualty company, and that was followed by another group with strength in employee benefits," Mr. Sharkey said. "Meeker Sharkey offered property and casualty, employee benefits, retirement services, and life products. We would like to grow sales in several insurance lines."

He said clients of Summit Insurance Advisors are being referred to Summit Bank for information services such as investment management, retirement services, brokerage, cash management, interest rate and currency strategies, and lending.

Summit has expanded heavily into Connecticut - it nearly doubled its branches there with the acquisition in March of New Milford-based NMBT Corp., a $403 million-asset bank with 10 branches in three counties. Summit now has $1.3 billion in assets, $882 million in deposits and 23 branches in the nutmeg state but is still relatively unknown there, while in Jersey it is a household name.

"Our name in Connecticut doesn't carry us as far as it does in New Jersey," Mr. McClure said. "So it becomes more important for us to find an agency in that state that already carries a strong reputation. It's another hurdle we have to overcome."

Another hurdle in Connecticut is a dwindling supply of sizable insurance agent targets. The largest banks in the state - Webster Financial Corp. of Waterbury and People's Bank in Bridgeport - have already snapped up a good chunk of the market.

Webster purchased two Connecticut agencies this year - Levine Cos., of Waterford, and Follis, Wylie & Lane, of Hamden - and now operates three under the newly created Webster Insurance banner. The bank entered the insurance business in 1998 by purchasing Dammon Associates of Westport. Webster Insurance CEO John Queirolo has said the bank is actively trying to add more agencies.

Meanwhile, People's Bank acquired Hartford-based R.C. Knox & Co. in July 1998 and Beardsley, Brown & Bassett of Hartford in 1999. The two agencies wrote $150 million in premiums in 1999 under the R.C. Knox name.

The People's acquisitions were brokered by Marsh, Berry & Co. of Concord, Ohio. Its executive vice president, Douglas Yoh, said that if Summit wants to jump into the independent agency game in Connecticut, it better act fast - before the remaining larger, strong shops are bought by the competition.

"There might be five independent agencies left in that state with revenues of over $5 million, and even then I don't know how many of them are strategic fits and how many of them are in parts of the state that Summit is interested in buying agencies," Mr. Yoh said. "There's one agency in Waterbury, one in Hartford, and one between Hartford and New Haven. Then, there might be one more in Fairfield County, which could fit."

On the other hand, an out-of-state bank like Summit might have an edge in getting an agency to sell.

"If a local bank were to buy you in Connecticut or anywhere else, you could get rolled up into their organization, and who knows what would happen," said John Wepler, vice president of mergers and acquisitions at Marsh Berry. "But if an out- of- state bank were to purchase an agency, the agency would probably be able to call more of the shots."

In Pennsylvania, Summit opened an insurance office in Fort Washington, where Prime Bancorp, which Summit acquired in 1999, was headquartered. Summit now has 113 branches in eastern Pennsylvania.

"We have branches from the Lehigh Valley to the Delaware Valley, and it makes plenty of sense for us to purchase an agency in those areas," Mr. Sharkey said. "The key is to find an agency with a strong sales force, production ability, and the ability to work successfully with a bank."

Mr. Sharkey said his company also remains interested in buying agencies in New Jersey.

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