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Marine Midland Bank is purchasing First Commercial Bank of Philadelphia for $23.7 million cash.

Although the acquisition is small -- First Commercial has just two branches and assets of only $90 million -- the marketing possibilities could be big. The deal pushes Buffalo-based Marine Midland's franchise across the Pennsylvania line for the first time in its 148-year history.

M&T Bank also broke into Pennsylvania this year through its purchase of Syracuse-based Onbancorp, the parent of Franklin First Savings Bank in Wilkes-Barre.

First Commercial is a popular banking choice within Philadelphia's Asian community. Marine Midland operates 10 branches in the New York metropolitan area focusing primarily on Asian-American customers as well.

Marine Midland's corporate roots feature a strong understanding of Asian culture. The bank's parent holding company, HSBC Holdings plc, also owns several banks headquartered in Asia.

"This acquisition capitalizes on Marine Midland's expertise in serving Asian customers and provides the bank with a base for building a retail branch network in Philadelphia," said Marine Midland President and CEO Malcolm Burnett.

First Commercial was established in 1989 to serve Philadelphia's growing Asian population. The bank specializes in retail and small business banking. First Commercial has deposits of about $78 million.

Marine Midland, which has 380 branches in New York and assets of $34 billion, will establish a new retail banking district in Philadelphia. The district will be headed by James R. Russell, First Commercial's president and CEO.

Marine Midland has been a conservative player in an era of rapid bank mergers and acquisitions. The bank purchased First Federal Savings and Loan of Rochester with a $620 million deal announced in August 1996.

The bank's executives often have said they think the price of many U.S. bank deals this year has been too high.

First Commercial Bank shareholders will receive $40.47 per share. The deal is still subject to approval by First Commercial shareholders, the Federal Reserve Bank of New York and the banking departments of both New York and Pennsylvania.

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