**Conditional Approval #716**

**December 2005**

November 18, 2005 By facscimile: 856.751.1147

and regular mail.

Mr. David Wojcik

Senior Vice President/Risk Management

Commerce Bank, N.A.

1701 Route 70 East

Cherry Hill, New Jersey 08034

Re: Application to merge Palm Beach County Bank, West Palm Beach,
Florida, with and into

Commerce Bank, National Association, Philadelphia, Pennsylvania, under
the title and

charter number of the latter.

Control No.: 2005-NE-02-0027 Charter No.: 17094

Dear Mr. Wojcik:

On today's date, the Office of the Comptroller of the Currency ("OCC")
has approved your proposal to merge Palm Beach County Bank, West Palm
Beach, Florida, ("PBCB"), with and into Commerce Bank, National
Association, Philadelphia, Pennsylvania, ("CBNA"), under the title and
charter number of the latter. This approval was granted based on a
thorough review of all information available, including the AML/BSA Plan
(the Plan), the commitments and representations made in the application
and those of your representatives, and the merger agreement; and the
understanding that Commerce Bank will cease the operations of PBCB which
owns 100% of Banker's Abstract & Land Insurance Agency, an insurance
agency located in Florida, which conduct closings and issue title
insurance for loans generated by Palm Beach Bank, and wholly owns PBCB,
Inc, a Florida corporation, incorporated in 1999 and currently defunct.

This approval is subject to the following condition(s):

1.  Prior to consummation, Commerce Bank will have in place a qualified
    AML/BSA Regional Officer for the Florida region.

2.  Prior to consummation, all training initiatives under the Plan must
    be completed.

3.  In the event that Commerce Bank intends to deviate from the Plan,
    Commerce Bank shall: (i) provide to the Chicago District Office,
    Assistant Deputy Comptroller for Mid-Size Banks, and the
    Examiner-in-Charge of Commerce Bank a prior written notice of intent
    to deviate or change from the Plan, and (ii) shall obtain the OCC's
    written determination of no objection before Commerce Bank engages
    in any deviations or changes described in the written notice. The
    OCC may impose additional conditions it deems appropriate in a
    written determination of no objection to Commerce Bank's written
    notice.

4.  Concurrent with consummation, Commerce Bank shall provide the OCC
    documentation certifying the divestiture or cessation of operations
    of PCBC and its subsidiaries.

5.  At least 10 days before consummation, Commerce Bank will provide a
    detailed written status report to the Mid-Size Banks' Assistant
    Deputy Comptroller and the Examiner-in-Charge for Commerce Bank,
    summarizing its efforts to adhere to the Plan for the Florida
    region.

The condition(s) of this approval are conditions "imposed in writing by
the agency in connection with the granting of any application or other
request within the meaning of 12 USC 1818. As such, the conditions are
enforceable under 12 USC 1818.

The OCC received comments from a Florida banking competitor opposing the
application. Some of the allegations raised by the commenter have been
addressed in court proceedings, and the remaining allegations are not
relevant to the statutory and regulatory factors considered under the
Bank Merger Act. Based on these reasons set forth above, the OCC has
determined that approval of the application is consistent under the Bank
Merger Act, 12 U.S.C. § 1828(c).

The district office must be advised in writing in advance of the desired
effective date for the merger so that the OCC may issue the necessary
certification. The effective date must follow the applicable Department
of Justice's injunction period and any other regulatory approval.

The OCC will issue a letter certifying consummation of the transaction
when we have received:

1)  A Secretary's Certificate for each institution, certifying that a
    majority of the board of directors approved the transaction, if not
    previously provided.

2)  An executed merger agreement with Articles of Association for the
    resulting bank attached, if not previously provided.

3)  A Secretary's Certificate for each institution, certifying that the
    shareholder approvals have been obtained, if not previously
    provided.

If the merger is not consummated within one year from the approval date,
the approval shall automatically terminate, unless the OCC grants an
extension of the time period.

Please be advised that the OCC is also authorizing the resulting bank,
should the combination occur between Call Report dates, to recalculate
its legal lending limit. The new lending limit should be calculated by
using data from the last Call Report of the individual banks filed prior
to consummating the merger, as adjusted for the combination. The
resulting bank will then file a new Call Report and begin calculating
its legal lending limit according to 12 C.F.R. §32.4(a) at the end of
the quarter following consummation of the combination.

This approval and the activities and communications by OCC employees in
connection with the filing do not constitute a contract, express or
implied, or any other obligation binding upon the OCC, the United States
(U.S.), any agency or entity of the United States, or any officer or
employee of the U. S., and do not affect the ability of the OCC to
exercise its supervisory, regulatory and examination authorities under
applicable law and regulations. The foregoing may not be waived or
modified by any employee or agent of the OCC or the U. S.

All correspondence regarding this application should reference the
control number. If you have any questions, please contact the
undersigned at 212.790.4055.

Sincerely,

**signed**

Gabriel Butler

Licensing Analyst

O

Comptroller of the Currency

Administrator of National Banks

New York, New York 10017

DECISION OF THE COMPTROLLER OF THE CURRENCY

ON THE APPLICATION TO MERGE PALM BEACH COUNTY BANK, WEST PALM BEACH,
FLORIDA, WITH AND INTO COMMERCE BANK, NATIONAL ASSOCIATION,
PHILADELPHIA, PENNSYLVANIA, UNDER THE CHARTER OF COMMERCE BANK, NATIONAL
ASSOCIATION AND TITLE OF COMMERCE BANK, NATIONAL ASSOCIATION

November 18, 2005

# Introduction

On August 11, 2005 application was made to the Comptroller of the
Currency for prior approval to merge Palm Beach County Bank, West Palm
Beach, Florida, 33409, (PBCB), with and into Commerce Bank, National
Association, Philadelphia, Pennsylvania, 19103, (CBNA), under the
charter and title of the latter. This application was based on an
agreement entered into between the parties on July 25, 2005.

**Participating Financial Institutions**

As of June 30, 2005, PBCB, a state-chartered community bank, had total
deposits of \$261 million and operated seven offices. On the same date,
CBNA had total deposits of \$21.5 billion and operated 69 offices. CBNA
is 100% owned and controlled by Commerce Bancorp, a multi- bank holding
company.

**Competitive Analysis**

The OCC considered the competitive effects of this proposal by using its
standard procedures for determining whether a business combination
clearly has minimal or no adverse competitive effects. The OCC finds
that the proposal satisfies its criteria for a merger and that it
clearly has no or minimal adverse competitive effects.

# Banking Factors

The Bank Merger Act requires the OCC to consider the financial and
managerial resources and future prospects of the existing and proposed
institutions, the convenience and needs of the community to be served,
and the effectiveness of the insured depository institutions involved in
the proposed transaction in combating money laundering activities. We
find that the financial and managerial resources of PBCB and CBNA do not
raise concerns that would cause the application to be disapproved. The
future prospects of the proponents, individually and combined, are
considered favorable and the resulting bank is expected to meet the
convenience and needs of the community to be served.

## 

# Community Reinvestment Act

A review of the record of this application and other information
available to the OCC as a result of its regulatory responsibilities has
revealed no evidence that the applicant's record of helping to meet the
credit needs of its communities, including low‑ and moderate‑income
neighborhoods, is inconsistent with approval of the application.

# Public Comments

The OCC received comments from a banking competitor in Florida opposing
the application. Some of the allegations raised by the commenter have
been addressed in court proceedings, and the remaining allegations are
not relevant to the statutory and regulatory factors considered under
the Bank Merger Act. Based on these reasons, the OCC has determined that
approval of the application is consistent with the Bank Merger Act.

# Conclusion

I have analyzed this proposal pursuant to the Bank Merger Act (12 USC
1828(c)) and 12 CFR 5.33, and find that it will not significantly lessen
competition in any relevant market. Other factors considered in
evaluating this proposal are satisfactory. Accordingly, I approve this
application subject to the conditions noted in a separate communication
to CBNA.

[]{.mark}

[\_\_\_\_Signed\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_]{.underline}
[11/18/2005\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_]{.underline}

Beverly Evans Date

Director for District Licensing

Application Control Number: 2005 NE 02 0027