Mercantile to buy back another 2 million shares

Mercantile Bankshares Corp. is burdened by money.

The company is having such a strong year that its board of directors yesterday authorized it to buy up to 2 million shares of its common stock as a way to spend excess cash.

The board also voted to pay shareholders a 23-cent dividend, which is payable Dec. 30 to stockholders of record as of Dec. 22. Mercantile paid a 23-cent dividend in the prior quarter.

Mercantile, the largest independent banking company based in Maryland, with $6 billion in assets, is buying its own stock because earnings and capital are growing faster than assets.

To put the money to work, Mercantile has not only been buying back stock, but has increased its dividend in recent quarters. It also acquired Sparks State Bank in October.

A company official declined to say how much money Mercantile plans to spend buying back its stock.

In addition to the 2 million shares it can buy, there are 725,000 shares that may be bought under a previously announced buyback plan.

Since 1993, when it first began the buyback program, Mercantile has bought back 2.3 million shares.