Commerce Bancorp CBH (NYSE) CEO and Chairman Vernon Hill was forced to resign after the company reached an agreement with federal regulators to bar transactions between company directors and outside vendors. Hill as well as others in the company came under scrutiny for their business dealings with insiders. Just as an example, Hill's wife, who owned an architectural design firm, was getting business from the bank for years. The company announced today it had settled two federal regulatory probes.
Hill, the bank's founder, was often referred to as a bank visionary. He was responsible for the bank's tremendous growth and success over the last number of years.
Commerce promoted three executives to the new office of Chairman for the bank subsidiary to replace Hill. As part of its agreement with regulators, the company stated it will continue to cooperate with any regulatory investigation of insider and insider-related transactions.
A number of analysts believe the loss of Vernon at the helm has made Commerce Bancorp a potential takeover target. In early trading the stock responded positively to the agreement and Vernon's resignation.
Speculation has also been raised that Hill's problems have not ended with his resignation. Stay tuned.
For more on the change and the agreement see:
Philadelphia Business Journal (July 6)
SEC 8K filing
Wall Street Journal (subscription req.)