Commerce Bancorp said its insurance brokerage services unit has been sold as it moves to complete a deal to merge with a Canadian-based bank. Terms of the sale transaction were not released.
The Cherry Hill, N.J.-based firm said Commerce Insurance Services was sold to a group led by George E. Norcross III, the brokerage's chairman, and Michael Tiagwad, Commerce Insurance Services president.
Commerce Bancorp is retaining ownership of its personal lines business.
Mr. Tiagwad promised in a statement that, "As one of the country's leading privately held insurance brokerages our focus on providing our clients with the outstanding service they have come to expect from Commerce will be stronger than ever. We also expect to carry on our valuable long-standing association with Commerce Bank."
Commerce Insurance Services said it provides a full range of property-casualty insurance and employee benefits coverage and services. It also provides niche coverage for education, financial services, executive risk, hospitality and gaming, life science, public entity, health care, professional liability, construction, risk control, real estate and surety.
Commerce Insurance Services said it would rank among the 10 largest privately held insurance brokerages–and rank as the 35th largest insurance brokerage in the nation. The broker will continue to operate a network of 13 offices serving clients in all 50 states. The firm will employ approximately 400 employees.
In Commerce Bancorp's third-quarter report for 2007, the bank reported insurance services produced revenues of $67.6 million for the first nine months of the year, up 6 percent, or $3.9 million from the same period in 2006.
Revenues for the third quarter increased 3 percent, or $671,000, to rise to $21.9 million.
Commerce Bancorp entered into an agreement to be acquired by Dominion Bank Financial Group of Toronto, Canada, in early October. As part of that agreement, the bank agreed to negotiate a deal with Mr. Norcross over the sale of the brokerage firm to him and a group of investors.
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