You've gotta hand it to the management team at Commerce Bancorp (NYSE:CBH) -- it knows to zig when people expect it to zag. Up until now, the company's expansion has followed a pretty logical train: first Philadelphia, then New York City, and then the Baltimore-Washington D.C. corridor.

So of course the next logical stop is. South Florida?

Yes, Commerce Bancorp is going to follow the fabled snowbirds and set up shop in sunnier climes. Its first step is the acquisition of Palm Beach County Bank for $100 million in stock, a deal that was announced yesterday. Although this is a small bank -- seven branches and $350 million in assets -- it will give Commerce a toehold from which to add 10 to 15 branches in 2006 and more thereafter, leading to a network of 150 or so branches in the region.

Geographic distance aside, the move makes plenty of sense. As Commerce management commented, the Palm Beach area is in some ways the sixth borough of New York City. By building branches down there, the company can look to solidify its relationship with northern customers while using those folks as leverage to build a new business in Florida.

Given the size and expansion of the South Florida market (including Miami), there's certainly substantial growth potential. Not only is the region home to retirees (some of whom are quite wealthy), but also a fast-growing population of younger people as well.

The news of Commerce Bancorp's arrival can't be good for the likes of BankAtlantic (NYSE:BBX), Colonial Bancgroup (NYSE:CNB), Commercial Bankshares (NASDAQ:CLBK), and South Financial Group (NASDAQ:TSFG). It's not as though Commerce is some sort of banking monolith, moving into communities and crushing small banks, but it is an innovative competitor. Besides, no company on earth really wants more competition in their market.

Growth is the name of the game at Commerce Bancorp these days, and this sort of expansion should help maintain that torrid pace. I've made my concerns known in the past (high expenses, etc.) and I won't rehash them here. Suffice to say that the company has an innovative approach to banking that's generating high growth and solid stock performance. For now.

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Fool contributor Stephen Simpson has no financial interest in any stocks mentioned (that means he's neither long nor short the shares).