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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
__________________________
Form 8-K

CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): April 16, 2024

Commerce Bancshares, Inc.
(Exact name of registrant as specified in its charter)
Missouri   001-36502   43-0889454
(State of Incorporation)   (Commission File Number)   (IRS Employer Identification No.)
1000 Walnut,    
Kansas City, MO   64106
(Address of principal executive offices)   (Zip Code)

(816) 234-2000
(Registrant’s telephone number, including area code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
     ☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
     ☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
     ☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
     ☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
Title of class Trading symbol(s) Name of exchange on which registered
$5 Par Value Common Stock CBSH NASDAQ Global Select Market
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 or Rule 12b-2 of the Securities Exchange Act of 1934.
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐



Item 2.02 Results of Operations and Financial Condition
A copy of the press release issued April 16, 2024 by Commerce Bancshares, Inc. announcing First Quarter 2024 earnings is furnished under Item 2.02 of this Current Report on Form 8-K as Exhibit 99.1. Additionally, a slide presentation for investors and analysts is being furnished as Exhibit 99.2 to this Current Report on Form 8-K.
The information in this Current Report on Form 8-K, including the exhibits, is furnished pursuant to Item 2.02 and shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities under that Section. Furthermore, the information in this Current Report on Form 8-K, including the exhibits, shall not be deemed to be incorporated by reference into the filings of Commerce Bancshares, Inc. under the Securities Act of 1933, as amended.
All information included in this Current Report on Form 8-K is available on the Company’s website at https://investor.commercebank.com/news-info/financial-news-releases/default.aspx.

Item 9.01 Financial Statements and Exhibits

Exhibits
99.1    Press release dated April 16, 2024
99.2    Slide presentation for investors and analysts dated April 16, 2024
104    The XBRL tags on the cover page of this Form 8-K are embedded within the Inline XBRL document.


SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
  COMMERCE BANCSHARES, INC.
  By:   /s/ Paul A. Steiner  
    Paul A. Steiner
   
Controller
(Chief Accounting Officer) 
Date: April 16, 2024


EX-99.1 2 cbsh3312024ex991.htm EX-99.1 Document
Exhibit 99.1
Exhibit 99.1
commercebancshares914a01a05a.jpg
 CBSH
                   1000 Walnut Street / Suite 700 / Kansas City, Missouri 64106 / 816.234.2000
FOR IMMEDIATE RELEASE:
Tuesday, April 16, 2024

COMMERCE BANCSHARES, INC. REPORTS
FIRST QUARTER EARNINGS PER SHARE OF $.86

Commerce Bancshares, Inc. announced earnings of $.86 per share for the three months ended March 31, 2024, compared to $.91 per share in the same quarter last year and $.84 per share in the fourth quarter of 2023. Net income for the first quarter of 2024 amounted to $112.7 million, compared to $119.5 million in the first quarter of 2023 and $109.2 million in the prior quarter.

“Commerce delivered a strong financial performance for the first quarter,” said John Kemper, President and Chief Executive Officer. “Our results are a reflection of fundamental strength and a diversified business model, and evidence of our ability to perform well through economic cycles.

“Although interest rates continue to be elevated and put downward pressure on bank balance sheets, Commerce's net interest income grew slightly over the previous quarter and our net interest margin expanded 16 basis points. Interest-bearing deposit costs increased just four basis points over the previous quarter, a product of our high-quality deposit franchise. Non-interest income comprised 37.4% of total revenue.

"Our liquidity and capital levels remain robust, and credit performance remains excellent, with non-accrual loans at .03% of total loans, down from .05% from the first quarter of last year."

First Quarter 2024 Financial Highlights:

•Net interest income was $249.0 million, a $578 thousand increase over the prior quarter. The net yield on interest earning assets increased 16 basis points to 3.33%.

•Non-interest income totaled $148.8 million, an increase of $11.2 million compared to the same quarter last year.

•Trust fees grew $5.8 million, or 12.7% compared to the same period last year, mostly due to higher private client fees.

•Non-interest expense totaled $245.7 million, an increase of $21.6 million compared to the same quarter last year and included a $10.0 million litigation settlement expense and a $4.0 million accrual adjustment to the FDIC's insurance special assessment.

•Average loan balances totaled $17.1 billion and were flat compared to the prior quarter.

•Total average available for sale debt securities decreased $116.6 million from the prior quarter to $9.5 billion, at fair value. During the first quarter of 2024, the unrealized loss on available for sale debt securities increased $27.2 million to $1.2 billion, at period end.
1
Exhibit 99.1

•Total average deposits decreased $759.5 million, or 3.0%, compared to the prior quarter, and included $225.4 million of lower average brokered deposits, which paid off last quarter. The average rate paid on interest bearing deposits in the current quarter was 1.97%.

•The ratio of annualized net loan charge-offs to average loans was .21% compared to .19% in the prior quarter.

•The allowance for credit losses on loans decreased $1.9 million during the first quarter to $160.5 million, and the ratio of the allowance for credit losses on loans to total loans was .93% at March 31, 2024, compared to .94% at December 31, 2023.

•Total assets at March 31, 2024 were $30.4 billion, a decrease of $1.3 billion, or 4.2%, compared to the prior quarter.

•For the quarter, the return on average assets was 1.48%, the return on average equity was 15.39%, and the efficiency ratio was 61.7%.

Commerce Bancshares, Inc. is a regional bank holding company offering a full line of banking services through its subsidiaries, including payment solutions, investment management and securities brokerage. One of its subsidiaries, Commerce Bank, leverages nearly 160 years of proven strength and experience to help individuals and businesses solve financial challenges. In addition to offering payment solutions across the U.S., Commerce Bank currently operates full-service banking facilities across the Midwest including the St. Louis and Kansas City metropolitan areas, Springfield, Central Missouri, Central Illinois, Wichita, Tulsa, Oklahoma City, and Denver. Beyond the Midwest, Commerce also maintains commercial offices in Dallas, Houston, Cincinnati, Nashville, Des Moines, Indianapolis, and Grand Rapids and wealth offices in Dallas, Houston, and Naples. Commerce delivers high-touch service and sophisticated financial solutions at regional branches, commercial and wealth offices, ATMs, online, mobile and through a 24/7 customer service line.

This financial news release and the supplementary Earnings Highlights presentation are available on the Company’s website at https://investor.commercebank.com/news-info/financial-news-releases/default.aspx.
* * * * * * * * * * * * * * *
For additional information, contact
Matt Burkemper, Investor Relations
(314) 746-7485
www.commercebank.com
matthew.burkemper@commercebank.com


2
Exhibit 99.1
COMMERCE BANCSHARES, INC. and SUBSIDIARIES
FINANCIAL HIGHLIGHTS

  For the Three Months Ended
(Unaudited)
(Dollars in thousands, except per share data)		 Mar. 31, 2024 Dec. 31, 2023 Mar. 31, 2023
FINANCIAL SUMMARY
Net interest income $248,999  $248,421  $251,623 
Non-interest income 148,848  144,879  137,612 
Total revenue 397,847  393,300  389,235 
Investment securities gains (losses) (259) 7,601  (306)
Provision for credit losses 4,787  5,879  11,456 
Non-interest expense 245,697  251,254  224,107 
Income before taxes 147,104  143,768  153,366 
Income taxes 31,652  32,307  32,813 
Non-controlling interest expense 2,789  2,238  1,101 
Net income attributable to Commerce Bancshares, Inc. $112,663  $109,223  $119,452 
Earnings per common share:    
Net income — basic $0.87  $0.84  $0.91 
Net income — diluted $0.86  $0.84  $0.91 
Effective tax rate 21.93  % 22.83  % 21.55  %
Fully-taxable equivalent net interest income $251,312  $250,547  $253,411 
Average total interest earning assets (1)
 $30,365,774  $31,340,958  $31,568,594 
Diluted wtd. average shares outstanding 129,185,903  129,608,322  130,471,930 
RATIOS    
Average loans to deposits (2)
 69.87  % 67.69  % 64.99  %
Return on total average assets 1.48  1.38  1.54 
Return on average equity (3)
 15.39  16.48  18.75 
Non-interest income to total revenue 37.41  36.84  35.35 
Efficiency ratio (4)
 61.67  63.80  57.49 
Net yield on interest earning assets 3.33  3.17  3.26 
EQUITY SUMMARY    
Cash dividends per share $.270  $.257  $.257 
Cash dividends on common stock $35,140  $33,574  $33,759 
Book value per share (5)
 $22.70  $22.77  $20.49 
Market value per share (5)
 $53.20  $53.41  $55.57 
High market value per share $55.64  $56.75  $66.86 
Low market value per share $49.44  $40.91  $53.07 
Common shares outstanding (5)
 129,694,606  130,176,048  130,956,746 
Tangible common equity to tangible assets (6)
 9.24  % 8.85  % 7.92  %
Tier I leverage ratio 11.75  % 11.25  % 10.61  %
OTHER QTD INFORMATION  
Number of bank/ATM locations 254  257  275 
Full-time equivalent employees 4,721  4,718  4,636 
(1) Excludes allowance for credit losses on loans and unrealized gains/(losses) on available for sale debt securities.
(2) Includes loans held for sale.
(3) Annualized net income attributable to Commerce Bancshares, Inc. divided by average total equity.
(4) The efficiency ratio is calculated as non-interest expense (excluding intangibles amortization) as a percent of total revenue.
(5) As of period end.
(6) The tangible common equity ratio is a non-gaap ratio and is calculated as stockholders’ equity reduced by goodwill and other intangible assets (excluding mortgage servicing rights) divided by total assets reduced by goodwill and other intangible assets (excluding mortgage servicing rights).
All share and per share amounts have been restated to reflect the 5% stock dividend distributed in December 2023.
3
Exhibit 99.1
COMMERCE BANCSHARES, INC. and SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME

 (Unaudited)
(In thousands, except per share data)		 For the Three Months Ended
Mar. 31, 2024 Dec. 31, 2023 Sep. 30, 2023 Jun. 30, 2023 Mar. 31, 2023
Interest income $358,721  $362,609  $361,162  $348,663  $308,857 
Interest expense 109,722  114,188  112,615  99,125  57,234 
Net interest income 248,999  248,421  248,547  249,538  251,623 
Provision for credit losses 4,787  5,879  11,645  6,471  11,456 
Net interest income after credit losses 244,212  242,542  236,902  243,067  240,167 
NON-INTEREST INCOME      
Trust fees 51,105  49,154  49,207  47,265  45,328 
Bank card transaction fees 46,930  47,878  46,899  49,725  46,654 
Deposit account charges and other fees 24,151  23,517  23,090  22,633  21,752 
Consumer brokerage services 4,408  3,641  3,820  4,677  5,085 
Capital market fees 3,892  4,269  3,524  2,945  3,362 
Loan fees and sales 3,141  2,875  2,966  2,735  2,589 
Other 15,221  13,545  13,443  17,625  12,842 
Total non-interest income 148,848  144,879  142,949  147,605  137,612 
INVESTMENT SECURITIES GAINS (LOSSES), NET (259) 7,601  4,298  3,392  (306)
NON-INTEREST EXPENSE      
Salaries and employee benefits 151,801  147,456  146,805  145,429  144,373 
Data processing and software 31,153  31,141  30,744  28,719  28,154 
Net occupancy 13,574  13,927  13,948  12,995  12,759 
Deposit insurance 8,017  20,304  4,029  4,187  4,643 
Equipment 5,010  5,137  4,697  4,864  4,850 
Supplies and communication 4,744  5,242  4,963  4,625  4,590 
Marketing 4,036  6,505  6,167  6,368  5,471 
Other 27,362  21,542  16,657  20,424  19,267 
Total non-interest expense 245,697  251,254  228,010  227,611  224,107 
Income before income taxes 147,104  143,768  156,139  166,453  153,366 
Less income taxes 31,652  32,307  33,439  35,990  32,813 
Net income 115,452  111,461  122,700  130,463  120,553 
Less non-controlling interest expense (income) 2,789  2,238  2,104  2,674  1,101 
Net income attributable to Commerce Bancshares, Inc. $112,663  $109,223  $120,596  $127,789  $119,452 
Net income per common share — basic $0.87  $0.84  $0.92  $0.97  $0.91 
Net income per common share — diluted $0.86  $0.84  $0.92  $0.97  $0.91 
OTHER INFORMATION
Return on total average assets 1.48  % 1.38  % 1.49  % 1.56  % 1.54  %
Return on average equity (1)
 15.39  16.48  17.73  18.81  18.75 
Efficiency ratio (2)
 61.67  63.80  58.15  57.22  57.49 
Effective tax rate 21.93  22.83  21.71  21.97  21.55 
Net yield on interest earning assets 3.33  3.17  3.11  3.12  3.26 
Fully-taxable equivalent net interest income $251,312  $250,547  $250,962  $251,757  $253,411 
(1) Annualized net income attributable to Commerce Bancshares, Inc. divided by average total equity.
(2) The efficiency ratio is calculated as non-interest expense (excluding intangibles amortization) as a percent of total revenue.
The income statement above reflects the reclassification of non-interest income of $406 thousand and $1.1 million from other non-interest income to capital market fees for the second and third quarters of 2023.

4
Exhibit 99.1
COMMERCE BANCSHARES, INC. and SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS - PERIOD END

(Unaudited)
(In thousands)		 Mar. 31, 2024 Dec. 31, 2023 Mar. 31, 2023
ASSETS      
Loans
     Business $ 5,994,974  $ 6,019,036  $ 5,704,467 
     Real estate — construction and land 1,497,647  1,446,764  1,437,419 
     Real estate — business 3,711,602  3,719,306  3,486,543 
     Real estate — personal 3,039,885  3,026,041  2,952,042 
     Consumer 2,119,308  2,077,723  2,094,389 
     Revolving home equity 322,523  319,894  295,478 
     Consumer credit card 564,388  589,913  558,669 
     Overdrafts 48,513  6,802  6,515 
Total loans 17,298,840  17,205,479  16,535,522 
Allowance for credit losses on loans (160,465) (162,395) (159,317)
Net loans 17,138,375  17,043,084  16,376,205 
Loans held for sale 2,328  4,177  6,162 
Investment securities:
Available for sale debt securities 9,141,695  9,684,760  11,228,616 
Trading debt securities 56,716  28,830  41,584 
Equity securities 12,852  12,701  12,528 
Other securities 229,146  222,473  268,417 
Total investment securities 9,440,409  9,948,764  11,551,145 
Federal funds sold —  5,025  27,060 
Securities purchased under agreements to resell 225,000  450,000  825,000 
Interest earning deposits with banks 1,609,614  2,239,010  1,341,854 
Cash and due from banks 291,040  443,147  351,210 
Premises and equipment — net 467,377  469,059  428,169 
Goodwill 146,539  146,539  138,921 
Other intangible assets — net 13,918  14,179  14,918 
Other assets 1,037,508  938,077  944,212 
Total assets $ 30,372,108  $ 31,701,061  $ 32,004,856 
LIABILITIES AND STOCKHOLDERS’ EQUITY      
Deposits:      
Non-interest bearing $ 7,513,464  $ 7,975,935  $ 8,685,234 
Savings, interest checking and money market 14,463,211  14,512,273  14,419,741 
Certificates of deposit of less than $100,000 997,979  930,432  468,667 
Certificates of deposit of $100,000 and over 1,465,541  1,945,258  1,109,818 
Total deposits 24,440,195  25,363,898  24,683,460 
Federal funds purchased and securities sold under agreements to repurchase 2,505,576  2,908,815  2,784,559 
Other borrowings 2,359  1,404  1,507,776 
Other liabilities 460,089  462,714  346,649 
Total liabilities 27,408,219  28,736,831  29,322,444 
Stockholders’ equity:      
Common stock 655,322  655,322  629,319 
Capital surplus 3,148,649  3,162,622  2,919,060 
Retained earnings 130,706  53,183  117,313 
Treasury stock (59,674) (35,599) (59,670)
Accumulated other comprehensive income (loss) (931,027) (891,412) (940,498)
Total stockholders’ equity 2,943,976  2,944,116  2,665,524 
Non-controlling interest 19,913  20,114  16,888 
Total equity 2,963,889  2,964,230  2,682,412 
Total liabilities and equity $ 30,372,108  $ 31,701,061  $ 32,004,856 

5
Exhibit 99.1
COMMERCE BANCSHARES, INC. and SUBSIDIARIES
AVERAGE BALANCE SHEETS

(Unaudited)
(In thousands)		 For the Three Months Ended
Mar. 31, 2024 Dec. 31, 2023 Sep. 30, 2023 Jun. 30, 2023 Mar. 31, 2023
ASSETS:
Loans:
Business $ 5,873,525  $ 5,861,229  $ 5,849,227  $ 5,757,388  $ 5,656,104 
Real estate — construction and land 1,472,554  1,523,682  1,508,850  1,450,196  1,410,835 
Real estate — business 3,727,643  3,644,589  3,642,010  3,540,851  3,478,382 
Real estate — personal 3,031,193  3,027,664  2,992,500  2,960,962  2,933,750 
Consumer 2,082,490  2,117,268  2,102,281  2,098,523  2,067,385 
Revolving home equity 322,074  310,282  304,055  300,623  296,748 
Consumer credit card 562,892  568,112  564,039  555,875  556,223 
Overdrafts 7,696  5,258  5,341  4,630  4,449 
Total loans
17,080,067  17,058,084  16,968,303  16,669,048  16,403,876 
Allowance for credit losses on loans (161,891) (161,932) (158,335) (159,068) (150,117)
Net loans 16,918,176  16,896,152  16,809,968  16,509,980  16,253,759 
Loans held for sale 2,149  5,392  5,714  5,957  5,708 
Investment securities:
U.S. government and federal agency obligations 851,656  889,390  986,284  1,035,651  1,099,067 
Government-sponsored enterprise obligations 55,652  55,661  55,676  55,751  87,086 
State and municipal obligations 1,330,808  1,363,649  1,391,541  1,532,519  1,793,756 
Mortgage-backed securities 5,902,328  6,022,502  6,161,348  6,316,224  6,454,408 
Asset-backed securities 2,085,050  2,325,089  2,553,562  2,827,911  3,233,757 
Other debt securities
503,204  510,721  514,787  519,988  528,941 
Unrealized gain (loss) on debt securities (1,274,125) (1,595,845) (1,458,141) (1,331,002) (1,387,196)
Total available for sale debt securities 9,454,573  9,571,167  10,205,057  10,957,042  11,809,819 
Trading debt securities
40,483  37,234  35,044  46,493  45,757 
Equity securities 12,768  12,249  12,230  12,335  12,458 
Other securities 221,695  222,378  237,518  273,587  229,867 
Total investment securities 9,729,519  9,843,028  10,489,849  11,289,457  12,097,901 
Federal funds sold 599  1,194  2,722  7,484  38,978 
Securities purchased under agreements to resell 340,934  450,000  712,472  824,974  825,000 
Interest earning deposits with banks 1,938,381  2,387,415  2,337,744  2,284,162  809,935 
Other assets 1,715,716  1,797,849  1,750,222  1,941,340  1,376,551 
Total assets $ 30,645,474  $ 31,381,030  $ 32,108,691  $ 32,863,354  $ 31,407,832 
LIABILITIES AND EQUITY:
Non-interest bearing deposits $ 7,328,603  $ 7,748,654  $ 7,939,190  $ 8,224,475  $ 9,114,512 
Savings 1,333,983  1,357,733  1,436,149  1,516,887  1,550,215 
Interest checking and money market 13,215,270  13,166,783  13,048,199  12,918,399  13,265,485 
Certificates of deposit of less than $100,000 976,804  1,097,224  1,423,965  1,075,110  415,367 
Certificates of deposit of $100,000 and over 1,595,310  1,839,057  1,718,126  1,472,208  903,393 
Total deposits 24,449,970  25,209,451  25,565,629  25,207,079  25,248,972 
Borrowings:
Federal funds purchased 328,216  473,534  508,851  507,165  493,721 
Securities sold under agreements to repurchase 2,511,959  2,467,118  2,283,020  2,206,612  2,418,726 
Other borrowings 76  179,587  685,222  1,617,952  551,267 
Total borrowings 2,840,251  3,120,239  3,477,093  4,331,729  3,463,714 
Other liabilities 410,310  421,402  367,741  598,915  112,052 
Total liabilities 27,700,531  28,751,092  29,410,463  30,137,723  28,824,738 
Equity 2,944,943  2,629,938  2,698,228  2,725,631  2,583,094 
Total liabilities and equity $ 30,645,474  $ 31,381,030  $ 32,108,691  $ 32,863,354  $ 31,407,832 

6
Exhibit 99.1
COMMERCE BANCSHARES, INC. and SUBSIDIARIES
AVERAGE RATES

(Unaudited) For the Three Months Ended
Mar. 31, 2024 Dec. 31, 2023 Sep. 30, 2023 Jun. 30, 2023 Mar. 31, 2023
ASSETS:  
Loans:  
Business (1)
 6.07  % 5.91  % 5.77  % 5.58  % 5.31  %
Real estate — construction and land 8.40  8.34  8.17  7.92  7.33 
Real estate — business 6.26  6.18  6.13  5.96  5.65 
Real estate — personal 3.95  3.85  3.73  3.68  3.61 
Consumer 6.40  6.21  5.97  5.63  5.31 
Revolving home equity 7.70  7.70  7.76  7.55  7.03 
Consumer credit card 14.11  13.83  13.77  13.77  13.68 
Overdrafts —  —  —  —  — 
Total loans 6.27  6.15  6.02  5.84  5.56 
Loans held for sale 7.49  9.93  10.55  10.17  10.30 
Investment securities:  
U.S. government and federal agency obligations 2.08  2.32  2.31  3.42  1.90 
Government-sponsored enterprise obligations 2.39  2.36  2.36  2.38  3.21 
State and municipal obligations (1)
 1.97  1.94  1.95  2.04  2.26 
Mortgage-backed securities 2.19  2.05  2.06  2.09  2.06 
Asset-backed securities 2.39  2.30  2.20  2.08  2.01 
Other debt securities 1.93  1.85  1.75  1.86  1.93 
Total available for sale debt securities 2.18  2.10  2.08  2.19  2.07 
Trading debt securities (1)
 5.30  5.05  5.11  4.53  4.59 
Equity securities (1)
 25.64  27.47  23.06  23.25  23.24 
Other securities (1)
 13.04  8.60  13.13  9.40  7.11 
Total investment securities 2.44  2.27  2.33  2.37  2.18 
Federal funds sold 6.71  6.65  6.56  5.63  5.09 
Securities purchased under agreements to resell 1.93  1.64  2.08  1.99  1.94 
Interest earning deposits with banks 5.48  5.47  5.39  5.14  4.67 
Total interest earning assets 4.78  4.62  4.51  4.34  4.00 
LIABILITIES AND EQUITY:  
Interest bearing deposits:  
Savings .06  .05  .05  .05  .05 
Interest checking and money market 1.69  1.57  1.33  .93  .61 
Certificates of deposit of less than $100,000 4.20  4.21  4.32  3.78  1.39 
Certificates of deposit of $100,000 and over 4.56  4.55  4.37  3.93  2.98 
Total interest bearing deposits 1.97  1.93  1.76  1.29  .71 
Borrowings:  
Federal funds purchased 5.42  5.40  5.33  5.06  4.59 
Securities sold under agreements to repurchase 3.43  3.25  3.20  3.09  2.93 
Other borrowings —  5.45  5.30  5.24  4.94 
Total borrowings 3.66  3.71  3.93  4.13  3.49 
Total interest bearing liabilities 2.21  % 2.20  % 2.12  % 1.87  % 1.20  %
Net yield on interest earning assets 3.33  % 3.17  % 3.11  % 3.12  % 3.26  %
(1) Stated on a fully taxable-equivalent basis using a federal income tax rate of 21%.







7
Exhibit 99.1
COMMERCE BANCSHARES, INC. and SUBSIDIARIES
CREDIT QUALITY

  For the Three Months Ended
(Unaudited)
(In thousands, except ratios)		 Mar. 31, 2024 Dec. 31, 2023 Sep. 30, 2023 Jun. 30, 2023 Mar. 31, 2023
ALLOWANCE FOR CREDIT LOSSES ON LOANS
Balance at beginning of period $162,395  $162,244  $158,685  $159,317  $150,136 
     Provision for credit losses on loans 6,947  8,170  13,343  5,864  15,948 
     Net charge-offs (recoveries):
        Commercial portfolio:
     Business 23  96  2,613  165  230 
     Real estate — construction and land —  —  —  (115) — 
     Real estate — business (141) 128  (15) (5) (4)
(118) 224  2,598  45  226 
        Personal banking portfolio:
     Consumer credit card 6,435  5,325  4,716  4,687  4,325 
     Consumer 1,983  1,903  1,797  1,273  1,275 
     Overdraft 557  588  683  517  978 
     Real estate — personal 24  (11) (9) (6) (11)
     Revolving home equity (4) (10) (1) (20) (26)
8,995  7,795  7,186  6,451  6,541 
     Total net loan charge-offs 8,877  8,019  9,784  6,496  6,767 
Balance at end of period $160,465  $162,395  $162,244  $158,685  $159,317 
LIABILITY FOR UNFUNDED LENDING COMMITMENTS $23,086  $25,246  $27,537  $29,235  $28,628 
NET CHARGE-OFF RATIOS (1)
Commercial portfolio:
     Business —  % .01  % .18  % .01  % .02  %
     Real estate — construction and land —  —  —  (.03) — 
     Real estate — business (.02) .01  —  —  — 
—  .01  .09  —  .01 
Personal banking portfolio:
     Consumer credit card 4.60  3.72  3.32  3.38  3.15 
     Consumer .38  .36  .34  .24  .25 
     Overdraft 29.11  44.37  50.73  44.79  89.15 
     Real estate — personal —  —  —  —  — 
     Revolving home equity —  (.01) —  (.03) (.04)
.60  .51  .48  .44  .45 
Total .21  % .19  % .23  % .16  % .17  %
CREDIT QUALITY RATIOS
Non-accrual loans to total loans .03  % .04  % .05  % .04  % .05  %
Allowance for credit losses on loans to total loans .93  .94  .95  .94  .96 
NON-ACCRUAL AND PAST DUE LOANS
  Non-accrual loans:
     Business $1,038  $3,622  $6,602  $4,732  $6,361 
     Real estate — business 1,246  60  76  153  171 
     Real estate — personal 1,523  1,653  1,531  1,276  1,269 
     Revolving home equity 1,977  1,977  —  —  — 
   Total 5,784  7,312  8,209  6,161  7,801 
Loans past due 90 days and still accruing interest $20,281  $21,864  $18,580  $15,351  $14,800 
(1) Net charge-offs are annualized and calculated as a percentage of average loans (excluding loans held for sale).
8
Exhibit 99.1                                        
COMMERCE BANCSHARES, INC.
Management Discussion of First Quarter Results
March 31, 2024
For the quarter ended March 31, 2024, net income amounted to $112.7 million, compared to $109.2 million in the previous quarter and $119.5 million in the same quarter last year. The increase in net income compared to the previous quarter was primarily the result of lower non-interest expense and higher non-interest income, partly offset by net losses on investment securities. The net yield on interest earning assets increased 16 basis points over the previous quarter to 3.33%. Average loans increased $22.0 million over the previous quarter, while average deposits, borrowings and available for sale debt securities, at fair value, declined $759.5 million, $280.0 million, and $116.6 million, respectively. For the quarter, the return on average assets was 1.48%, the return on average equity was 15.39%, and the efficiency ratio was 61.7%.

Balance Sheet Review
During the 1st quarter of 2024, average loans totaled $17.1 billion, an increase of $22.0 million over the prior quarter, and increased $676.2 million, or 4.1%, over the same quarter last year. Compared to the previous quarter, average balances of business real estate loans grew $83.1 million, while construction and consumer loans declined $51.1 million and $34.8 million, respectively. During the current quarter, the Company sold certain fixed rate personal real estate loans totaling $7.4 million, compared to $8.7 million in the prior quarter.

Total average available for sale debt securities decreased $116.6 million compared to the previous quarter to $9.5 billion, at fair value. The decrease in debt securities was mainly the result of lower average balances of asset-backed securities. During the 1st quarter of 2024, the unrealized loss on available for sale securities increased $27.2 million to $1.2 billion, at period end. Also during the 1st quarter of 2024, purchases of securities totaled $145.7 million with a weighted average yield of approximately 4.65%, and sales, maturities and pay downs were $655.0 million. At March 31, 2024, the duration of the available for sale investment portfolio was 4.2 years, and maturities and pay downs of approximately $1.6 billion are expected to occur during the next 12 months. The Company does not have any investment securities classified as held-to-maturity.

Total average deposits decreased $759.5 million this quarter compared to the previous quarter. The decrease in deposits mostly resulted from lower average demand deposits of $420.1 million and lower average certificates of deposit of $364.2 million, which included lower brokered deposits of $225.4 million. Compared to the previous quarter, total average commercial deposits declined $743.8 million, while consumer and wealth deposits increased $138.8 million and $71.8 million, respectively. The average loans to deposits ratio was 69.9% in the current quarter and 67.7% in the prior quarter. The Company’s average borrowings, which included average customer repurchase agreements of $2.5
billion, decreased $280.0 million to $2.8 billion in the 1st quarter of 2024, mostly due to a decline of $179.3 million in average Federal Home Loan Bank (FHLB) borrowings.

Net Interest Income
Net interest income in the 1st quarter of 2024 amounted to $249.0 million, an increase of $578 thousand compared to the previous quarter. On a fully taxable-equivalent (FTE) basis, net interest income for the current quarter increased $765 thousand over the previous quarter to $251.3 million. The increase in net interest income was mostly due to higher interest earned on loans and investment securities and lower interest expense on deposits and borrowings, partly offset by lower interest income earned on deposits with banks. The net yield (FTE) on earning assets increased to 3.33%, from 3.17% in the prior quarter.

Compared to the previous quarter, interest income on loans (FTE) increased $1.7 million, mostly due to higher average rates earned on business, consumer, and personal real estate loans. Interest income on loans also increased due to higher balances of business real estate loans, largely offset by lower balances of construction loans. The average yield (FTE) on the loan portfolio increased 12 basis points to 6.27% this quarter.

Interest income on investment securities (FTE) increased $1.3 million compared to the prior quarter, mostly due to higher rates earned on other debt securities, partly offset by lower average balances of available for sale debt securities. Interest on other debt securities included dividend payments of $3.4 million from the Company’s private equity investments. Interest income earned on U.S. government and federal agency securities decreased due to lower average balances and lower average rates, which included the impact of $1.7 million in lower inflation income from Treasury inflation-protected securities this quarter. Additionally, the Company recorded a $2.0 million adjustment to premium amortization at March 31, 2024, which increased interest income to reflect slower forward prepayment speed estimates on mortgage-backed securities and was higher than the $629 thousand adjustment that increased interest income in the prior quarter. The average yield (FTE) on total investment securities was 2.44% in the current quarter, compared to 2.27% in the previous quarter.

Compared to the previous quarter, interest income on deposits with banks decreased $6.5 million, mostly due to $449.0 million of lower average balances.

Interest expense decreased $4.5 million, mostly due to lower average balances of borrowings and deposits, partly offset by higher rates paid. The average rate paid on interest bearing deposits totaled 1.97% in the current quarter compared to 1.93% in the prior quarter.
9
Exhibit 99.1
COMMERCE BANCSHARES, INC.                                
Management Discussion of First Quarter Results
March 31, 2024
Interest expense on deposits decreased $1.2 million this quarter compared to the previous quarter. Interest expense on borrowings decreased $3.3 million, mostly due to a decline in average FHLB borrowings of $179.3 million and lower average balances of federal funds purchased. The overall rate paid on interest bearing liabilities was 2.21% in the current quarter compared to 2.20% in the prior quarter.

Non-Interest Income
In the 1st quarter of 2024, total non-interest income amounted to $148.8 million, an increase of $11.2 million compared to the same period last year and an increase of $4.0 million compared to the prior quarter. The increase in non-interest income compared to the same period last year was mainly due to higher trust fees, deposit account fees, and tax credit sales income. The increase in non-interest income compared to the prior quarter was mainly due to higher trust fees, brokerage fees, and tax credit sales income, partly offset by lower bank card fees.

Total net bank card fees in the current quarter increased $276 thousand, or .6%, compared to the same period last year, and decreased $948 thousand compared to the prior quarter. Net corporate card fees increased $164 thousand, or .6%, over the same quarter of last year mainly due to higher interchange fees, partly offset by higher rewards expense. Net debit card fees increased $118 thousand, or 1.1%, mostly due to lower network expense. Net merchant fees decreased $104 thousand, or 1.9%, while net credit card fees increased $98 thousand, or 2.7%. Total net bank card fees this quarter were comprised of fees on corporate card ($27.5 million), debit card ($10.4 million), merchant ($5.2 million) and credit card ($3.8 million) transactions.

In the current quarter, trust fees increased $5.8 million, or 12.7%, over the same period last year, mostly resulting from higher private client trust fees. Compared to the same period last year, deposit account fees increased $2.4 million, or 11.0%, mostly due to higher corporate cash management fees. Consumer brokerage fees decreased $677 thousand, or 13.3%.

Other non-interest income increased compared to the same period last year primarily due to higher tax credit sales income of $1.5 million and cash sweep fees of $731 thousand. For the 1st quarter of 2024, non-interest income comprised 37.4% of the Company’s total revenue.

Investment Securities Gains and Losses
The Company recorded net securities losses of $259 thousand in the current quarter, compared to gains of $7.6 million in the prior quarter and losses of $306 thousand in the 1st quarter of 2023. Net securities
losses in the current quarter primarily resulted from losses of $8.5 million realized on available for sale debt securities, partly offset by net fair value gains of $7.1 million in the Company’s portfolio of private equity investments.

Non-Interest Expense
Non-interest expense for the current quarter amounted to $245.7 million, compared to $224.1 million in the same period last year and $251.3 million in the prior quarter. The increase in non-interest expense compared to the same period last year was mainly due to litigation settlement expense as well as higher salaries and employee benefits expense, FDIC insurance expense, and data processing and software expense, partly offset by lower marketing expense. The decrease in non-interest expense compared to the prior quarter was mainly due to lower FDIC insurance expense and marketing expense, partly offset by higher litigation settlement expense and employee benefits expense.

Compared to the 1st quarter of last year, salaries and employee benefits expense increased $7.4 million, or 5.1%, mostly due to higher full-time salaries expense of $5.8 million and higher employee benefits expense of $1.3 million. Full-time equivalent employees totaled 4,721 and 4,636 at March 31, 2024 and 2023, respectively.

Compared to the same period last year, data processing and software expense increased $3.0 million due to higher bank card fees expense and increased costs for service providers. FDIC insurance expense increased $3.4 million, due to a $4.0 million accrual adjustment in the current quarter to the special assessment by the FDIC to replenish the Deposit Insurance Fund. These increases in expense were partly offset by lower marketing expense of $1.4 million. Other non-interest expense increased mainly due to $10.0 million in litigation settlement costs.

Income Taxes
The effective tax rate for the Company was 21.9% in the current quarter, 22.8% in the previous quarter, and 21.6% in the 1st quarter of 2023.

Credit Quality
Net loan charge-offs in the 1st quarter of 2024 amounted to $8.9 million, compared to $8.0 million in the prior quarter and $6.8 million in the same period last year. The ratio of annualized net loan charge-offs to total average loans was .21% in the current quarter, .19% in the previous quarter, and .17% in the 1st quarter of last year. Compared to the prior quarter, net loan charge-offs on personal banking loans increased $1.2 million to $9.0 million, mainly due to $1.1 million of higher consumer credit card loan net charge-offs.

In the 1st quarter of 2024, annualized net loan charge-offs on average consumer credit card loans were 4.60%, compared to 3.72% in the previous quarter, and 3.15% in the same quarter last year.
10
Exhibit 99.1
COMMERCE BANCSHARES, INC.                                
Management Discussion of First Quarter Results
March 31, 2024
Consumer loan net charge-offs were .38% of average consumer loans in the current quarter, .36% in the prior quarter, and .25% in the same quarter last year.

At March 31, 2024, the allowance for credit losses on loans totaled $160.5 million, or .93% of total loans, and decreased $1.9 million compared to the prior quarter. Additionally, the liability for unfunded lending commitments at March 31, 2024 was $23.1 million, a decrease of $2.2 million compared to the liability at December 31, 2023.

At March 31, 2024, total non-accrual loans amounted to $5.8 million, a decrease of $1.5 million compared to the previous quarter. At March 31, 2024, the balance of non-accrual loans, which represented .03% of loans outstanding, included business loans of $1.0 million, revolving home equity loans of $2.0 million, personal real estate loans of $1.5 million, and business real estate loans of $1.2 million. Loans more than 90 days past due and still accruing interest totaled $20.3 million at March 31, 2024.

Other
During the 1st quarter of 2024, the Company paid a cash dividend of $.27 per common share, representing a 5.1% increase over the same period last year. The Company purchased 806,217 shares of treasury stock during the current quarter at an average price of $52.13.

The Company owns 823,447 shares of Visa Class B-1 common stock, carried at zero value on the Company’s balance sheet as of March 31, 2024. On April 8, 2024, Visa, Inc. (“Visa”) announced the commencement of a public offering to exchange Class B-1 common stock for a combination of shares of Class B-2 common stock and Class C common stock (“Exchange Offer”). The Company tendered all of its Visa Class B-1 shares and is awaiting notification of acceptance of that tender and the closing of the Exchange Offer. If the Company’s tendered shares are accepted and the exchange occurs in the second quarter of 2024, the Company expects to record a significant gain during the second quarter of 2024 based on the conversion privilege of the Class C common stock and the closing price of Visa Class A common stock. A full description of the terms of the Exchange Offer is set forth in Visa’s related Issuer Tender Offer Statement on Schedule TO and Prospectus, each dated April 8, 2024, publicly filed with the U. S. Securities and Exchange Commission.

Forward Looking Information
This information contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements include future financial and operating results, expectations, intentions, and other statements that are not historical facts. Such statements are based on current beliefs and
expectations of the Company’s management and are subject to significant risks and uncertainties. Actual results may differ materially from those set forth in the forward-looking statements.
11
EX-99.2 3 a2024q1earningshighlight.htm EX-99.2 a2024q1earningshighlight
COMMERCE BANCSHARES, INC. EARNINGS HIGHLIGHTS 1st Quarter 2024 PEOPLE, GROWTH AND POSSIBILITIES

 
CAUTIONARY STATEMENT A number of statements we will be making in our presentation and in the accompanying slides are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, such as statements of the Corporation’s plans, goals, objectives, expectations, projections, estimates and intentions. These forward- looking statements involve significant risks and uncertainties and are subject to change based on various factors (some of which are beyond the Corporation’s control). Factors that could cause the Corporation’s actual results to differ materially from such forward- looking statements made herein or by management of the Corporation are set forth in the Corporation’s 2023 Annual Report on Form 10-K and the Corporation’s Current Reports on Form 8-K. 2

 
COMMERCE BANCSHARES 158 YEARS IN BUSINESS 1Locations outside the core banking footprint that accept deposits Sources: 2S&P Global Market Intelligence – Regulated U.S. depositories which includes commercial banks, bank holding companies, and credit unions, rankings as of 12/31/2023; 3Includes loans held for sale; 4Moody’s Sector Profile: Banks, March 1, 2024, Baseline Credit Assessment (BCA) reflects a bank’s standalone credit strength; Company reports and filings, information as of 3/31/2024 unless otherwise noted. 3 $30.4 BILLION TOTAL ASSETS 41st LARGEST U.S. BANK BASED ON ASSET SIZE2 $6.9 BILLION MARKET CAP 22nd LARGEST U.S. BANK BASED ON MARKET CAP2 $70.2 BILLION TOTAL TRUST ASSETS UNDER ADMINISTRATION 20TH LARGEST AMONG BANK-MANAGED TRUST COMPANIES BASED ON AUM2 15.25% TIER 1 COMMON RISK- BASED CAPITAL RATIO 4TH HIGHEST AMONG TOP 50 U.S. BANKS BASED ON ASSET SIZE2 a2 BASELINE CREDIT ASSESSMENT4 TWO RATINGS ABOVE THE U.S. BANKING INDUSTRY MEDIAN RATING OF baa1 $24.4 BILLION TOTAL DEPOSITS $17.3 BILLION TOTAL LOANS3 $9.9 BILLION COMMERCIAL CARD VOLUME 15.39% RETURN ON AVERAGE COMMON EQUITY YTD 4TH YTD ROACE FOR THE TOP 50 U.S. BANKS BASED ON ASSET SIZE2 AS OF DECEMBER 31, 2023 AS OF Dec. 31, 2023 U.S. PRESENCE Extended Market Area Commercial Payments Services Offered in 48 states across the U.S. 142 branches and 268 ATMs across 7 states CORE BANKING FOOTPRINT COMMERCIAL | CONSUMER | WEALTH MANAGEMENT St. Louis • Kansas City • Springfield Central Missouri • Central Illinois • Wichita Tulsa • Oklahoma City • Denver WEALTH MANAGEMENT OFFICES Dallas • Houston1 • Naples1 COMMERCIAL OFFICES Cincinnati • Nashville • Dallas • Des Moines Indianapolis • Grand Rapids • Houston1

 
4 TRACK RECORD OF LONG-TERM OUTPERFORMANCE Revenue Diversification Balanced earnings profile, fee revenue at 37%1 of total revenue, bolstered by growing wealth and national payments businesses Deposit Franchise $23.0 billion in low-cost, diverse deposits2 with peer-leading historical deposit betas Continued Long-Term Investments Core banking system implementation, Enterprise Digital, Expansion Markets, Wealth Management, Consistent Earnings & Shareholder Value Over 10% total annualized return to shareholders over the last 15 years, outperforming the annualized KBW Regional Bank Index return of 9%3 Capital Management Strong capital ratios, 56th consecutive year of common dividend increases4 Credit Quality Conservative risk profile drives outperformance across credit cycles 1As of YTD 3/31/2024; 2Excludes certificates of deposit greater than $100,000, period-end balance as of 3/31/2024; 3As of 3/31/2024; 4Based on 1Q2024 paid dividend

 
$.86 EPS • Net interest income up slightly over Q4 at $249MM. • Net interest margin increased 16 bps over Q4 to 3.33%. • Total cost of deposits increased 4 bps to 1.38%, compared to an increase of 13 bps in Q4. • Non-interest expense includes a one-time $10MM litigation settlement expense2 and a $4MM adjustment to the FDIC special assessment2. • Total average assets declined $736MM from Q4 mostly due to lower deposits balances at the Fed, driven by lower customer deposit balances and borrowings. • Period end non-interest bearing deposits to total deposits was down slightly from Q4 to 30.7%. • Net loan charge-offs of .21% and non-accrual loans of .03%. • TCE/TA increased 39 bps over Q4 to 9.24%. Highlights Well-positioned for current environment 1Q2024 HIGHLIGHTS $152.2 million PPNR1 $112.7 million Net Income 15.39% ROACE 1.48% ROAA 61.67% Efficiency Ratio 1See the non-GAAP reconciliation on page 24 2Accrued in 1Q24 5

 
1Q24 vs. 1Q23 1Q24 vs. 4Q23 Quarterly Average Balances % Change$ Change% Change$ Change1Q24$ in millions 5%$528.40%$44.2$11,073.7Commercial 3%147.8(0)%(22.2)6,006.3Consumer 4%$676.20%$22.0$17,080.1Total Loans (20)%)$(2,368.4(1)%)$(113.5$9,729.5Investment Securities 139%$1,128.4(19)%$(449.0)$1,938.4 Interest Earning Deposits with Banks (3)%)$(799.0(3)%)$(759.5$24,450.0Deposits 11%$2.21(0)%$(0.1)$22.70Book Value per Share1 BALANCE SHEET HIGHLIGHTS 1For the quarters ended March 31, 2024, December 31, 2023, and March 31, 2023 Loans: Flat compared to the prior quarter, 1% growth annualized Investment securities: Net maturities and paydowns providing liquidity. Interest Earning Deposits with Banks: Decline from previous quarter but ample levels of liquidity remained through Q1. Average Deposits: Declined from Q4, mostly reflecting CD maturities and seasonality. 6

 
$16.1 $17.5 $17.1 $9.1 $7.7 $7.3 1Q23 4Q23 1Q24 $25.2 $25.2 $24.4 -3% $10.5 $11.0 $11.1 $5.9 $6.1 $6.0 1Q23 4Q23 1Q24 $16.4 $17.1 $17.1 BALANCE SHEET 7 Loans Consumer Loans Commercial Loans Loan Yield Deposits QTD Average Balances $ billions Non-Interest Bearing Interest-Bearing Deposits Interest-Bearing Deposit Cost QTD Average Balances $ billions 5.56% 6.15% 6.27% .71% 1.93% 1.97% +4%

 
LOAN PORTFOLIO 8 YoYQoQ3/31/202312/31/20233/31/2024$ in 000s 5.1%-.4%$5,704,467 $6,019,036$5,994,974Business 4.2%3.5%1,437,4191,446,7641,497,647Construction 6.5%-.2%3,486,5433,719,3063,711,602Business Real Estate 3.0%.5%2,952,0423,026,0413,039,885Personal Real Estate 1.2%2.0%2,094,3892,077,7232,119,308Consumer 9.2%.8%295,478319,894322,523Revolving Home Equity 1.0%-4.3%558,669589,913564,388Consumer Credit Card 644.6%613.2%6,5156,80248,513Overdrafts 4.6%.5%$16,535,522$17,205,479$17,298,840Total Loans Period-End Balances YoYQoQ3/31/202312/31/20233/31/2024$ in 000s 3.8%.2%$5,656,104$5,861,229$5,873,525Business 4.4%-3.4%1,410,8351,523,6821,472,554Construction 7.2%2.3%3,478,3823,644,5893,727,643Business Real Estate 3.3%.1%2,933,7503,027,6643,031,193Personal Real Estate .7%-1.6%2,067,3852,117,2682,082,490Consumer 8.5%3.8%296,748310,282322,074Revolving Home Equity 1.2%-.9%556,223568,112562,892Consumer Credit Card 73.0%46.4%4,4495,2587,696Overdrafts 4.1%.1%$16,403,876$17,058,084$17,080,067Total Loans QTD Average Balances

 
32.1% 13.1% 16.3% 9.5% 7.9% 7.9% 5.2% 4.7% Owner- occupied Office Industrial Retail Multi-family Hotels Farm Senior living 3.3% Other Real Estate - Business Loans: Office Outstanding Balances by Geography1 % of Total Loans Real Estate - Business Loans 6.9%Owner – Occupied 3.5%Industrial 2.8%Office 2.0%Retail 1.7%Hotels 1.7%Multi-family 1.1%Farm 1.0%Senior living .8%Other 21.5%Total COMMERCIAL REAL ESTATE BREAKDOWN 9 Real Estate - Business Loans $3.7 billion 1Geography determined by location of collateral. Includes only loans with a balance of $1 million and above, which represents 93% of outstanding balance of the stabilized, non-owner occupied office loans 2Critized is defined as special mention, substandard, and non-accrual loans 3LTV based on current exposure and property value at time of most recent valuation. Includes only loans with a balance of $1 million and above, which represents 93% of outstanding balance of the stabilized, non- owner occupied office loans Real Estate - Business Loans: Office Attributes as of March 31, 2024 53.4% 6.3% 19.6% 5.1% 7.5% MO TX KS 2.8% OK 2.0% IL CO 2.5% OH Other Midwest States 0.8% Other States • TTM Net Charge-offs on Office loans: .00% • Delinquent Office Loans: .00% • Non-Performing Office Loans: .00% • Criticized2 Office Loans to Total Office Loans: 3.69% • Weighted Average LTV of Office Loans: 63.6%3 • Percent of loans at floating interest rate: 74.7%

 
10 INCOME STATEMENT HIGHLIGHTS $137 $165 $252 $224 1Q23 $389 $149 $152 $249 $232 1Q24 $398 Non-Interest Income (+) Net Interest Income (+) Non-Interest Expense (-) Pre-Tax, Pre-Provision Net Revenue (=) 1Q24 Comparison (7.9)%vs. 1Q23 7.1%vs. 4Q23 Pre-Tax, Pre-Provision Net Revenue (PPNR) $ in millions PPNR, excluding FDIC special assessments and a one-time litigation settlement accrual, was up 5.2% over 4Q and up .7% over the same period last year. Revenue was up 1.2% over Q4 and up 2.2% over the same period last year. Expenses, excluding the FDIC special assessment1 and one-time litigation settlement accrual, were down 1.5% from Q4 and up 3.4% over the same period last year. $251 $16 See the non-GAAP reconciliation on page 24 1Accrued $16M in 4Q23 and $4M in 1Q24 $145 $142 $248 $235 4Q23 $393 FDIC special assessment $246 $4 FDIC special assessment $10 One-time litigation settlement accrual

 
1Q24 vs. 1Q23 1Q24 vs. 4Q23 % Change$ Change% Change$ Change1Q24$ in millions (1)%)$(2.60%$.6$249.0Net Interest Income 8%$11.23%$4.0$148.8Non-Interest Income 10%$21.6(2)%)$(5.6$245.7Non-Interest Expense (8)%)$(13.07%$10.1$152.2Pre-Tax, Pre-Provision Net Revenue1 15%$.0(103)%)$(7.9$(.3)Investment Securities Losses, Net (58)%)$(6.7(19)%)$(1.1$4.8Provision for Credit Losses (6)%)$(6.83%$3.4$112.7Net-Income Attributable to Commerce Bancshares, Inc. 1Q24 vs. 1Q231Q23 1Q24 vs. 4Q234Q231Q24For the three months ended (5)%$.912%$.84$.86Net Income per Common Share – Diluted 7 bps3.26%16 bps3.17%3.33%Net Yield on Interest Earning Assets INCOME STATEMENT HIGHLIGHTS 1See the non-GAAP reconciliation on page 24 11

 
NON-INTEREST INCOME HIGHLIGHTS 12 1Q24 vs. 1Q23 1Q24 vs. 4Q23 % Change$ Change% Change$ Change1Q24$ in millions 1%$.3(2)%)$(.9$46.9Bank Card Transaction Fees 13%5.84%2.051.1Trust Fees 11%2.43%.624.2Deposit Account Charges and Other Fees 16%.5(9)%)(.43.9Capital Market Fees (13)%)(.721%.84.4Consumer Brokerage Services 21%.69%.33.1Loan Fees and Sales 19%2.412%1.715.2Other 8%$11.23%$4.0$148.8Total Non-Interest Income Bank Card Fees: Decrease from Q4 was driven by seasonality. Trust Fees: Increase over the prior year was mostly driven by higher private client fees. Deposit Account Charges and Other Fees: Increase compared to the same period last year due to higher corporate cash management fees.

 
NON-INTEREST EXPENSE HIGHLIGHTS 13 1Q24 vs. 1Q23 1Q24 vs. 4Q23 % Change$ Change% Change$ Change1Q24$ in millions 5%$7.43%$4.3$151.8Salaries and Employee Benefits 11%3.00%.031.2Data Processing and Software 6%.8-3%-.413.6Net Occupancy 73%3.4-61%-12.38.0Deposit Insurance 3%.2-2%-.15.0Equipment 3%.2-10%-.54.7Supplies and Communication -26%-1.4-38%-2.54.0Marketing 42%8.127%5.827.4Other 10%$21.6-2%$-5.6$245.7Total Non-Interest Expense 3%$7.5-2%$-3.6$231.6Total Non-Interest Expense, adjusted 1 1Excluding a $4.0 million adjustment to the FDIC special assessment and a $10 million one-time litigation settlement accrual in 1Q24 and $16.0 million FDIC special assessment in 4Q23. 2Accrued in 1Q24 Total non-interest expense: Increase of 3% over prior year excluding FDIC and litigation settlement accruals1 Salaries and employee benefits: Increase over the prior quarter mainly due to higher payroll taxes; increase over prior year was mostly due to higher full- time salaries. Deposit Insurance: Includes an additional $4.0 million FDIC special assessment2. Other: Includes a one-time litigation settlement accrual of $10.0 million2.

 
14 LIQUIDITY AND CAPITAL

 
LIQUIDITY AND CAPITAL HIGHLIGHTS 15 • $1.6B in cash at Federal Reserve Bank (FRB) at Q1. • AFS debt securities portfolio duration of 4.2 years. • Investment securities purchases in Q1 totaled $145.7MM at a weighted average yield of 4.65%. • Cash flows from maturities and paydowns of investments and resale agreements of approximately $1.8B expected over the next twelve months. – AFS debt securities of $1.6B – Securities purchased under agreements to resell of $125MM Liquidity • TCE/TA of 9.24%, an increase of 39 bps over Q4. Tier 1 leverage at 11.75%. • Purchased $42.0MM of common stock vs. $20.2MM in Q4. • AOCI loss increased from $(891MM) at Q4 to $(931MM) at Q1. • Tendered 823,477 of Visa Class B-1 shares, awaiting notification of acceptance and the closing of the exchange offer. Capital • QTD Average loan to deposit ratio of 70%. • Optimizing sources and uses of funding, allowing high cost CDs to mature. • Total deposits at period end decreased $924MM and customer repurchase agreements decreased $406MM. Balance Sheet / Deposits

 
2020 2021 2022 3Q23 4Q23 1Q24 $2.3 $3.0 $2.8 $2.3 $2.3 $2.4 DEPOSIT BALANCE TRENDS Segment view $ in billions 16 2020 2021 2022 3Q23 4Q23 1Q24 $9.9 $12.0 $11.9 $10.5 $10.6 $9.9 2020 2021 2022 3Q23 4Q23 1Q24 $11.3 $12.8 $13.4 $12.1 $12.1 $12.2 Commercial Consumer Wealth Average Balance 3Q23 4Q23 1Q24 $12.3 $12.4 $12.6 Period EndAverage Balance Average Balance Segment balances do not include brokered deposits. 2020 through 2022 are full year average balances. 3Q23 4Q23 1Q24 $10.0 $10.4 $9.3 Period End 3Q23 4Q23 1Q24 $2.3 $2.5 $2.4 Period End

 
Hedging Structures: Four floor contracts (indexed to 1 Month SOFR) to hedge the risk of declining interest rates on floating rate commercial loans. The contracts have a term of 6 years. • 3.5% floor contract with a notional value of $500 million. The contract begins 7/2024. • 3.25% floor contract with a notional value of $500 million. The contract begins 11/2024. • 3.0% floor contract with a notional value of $500 million. The contract begins 3/2025. • 2.75% floor contract with a notional value of $500 million. The contract begins 7/2025. WELL-POSITIONED FOR MULTIPLE RATE ENVIRONMENTS 17 Opportunities to enhance and protect NII. • Net yield on interest earning assets increased 16 bps over Q4 to 3.33%. • Loan yield increased 12 bps over Q4 to 6.27%. • Total deposit costs increased 4 bps over Q4 to 1.38%. • As of December 31, 2023, 57% of loans were variable rate, (73% commercial, 27% consumer). • Large core deposit base and historically low betas. Cost of Total Deposits & Deposit Beta: Prior & Current Fed Cycle Cost of Total Deposits Deposit Beta1 End of Fed Rate Increases / Current Before Fed Rate Increases 12%.38%.12%Commerce (3Q2015 – 2Q2019) 27%.85%.23%Peer Median (3Q2015 – 2Q2019) 26%1.38%.03%Commerce (4Q2021 – 1Q2024) 0.0% 0.5% 1.0% 1.5% 2.0% 2.5% 3.0% 3.5% 4.0% 4.5% 5.0% 5.5% 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 Quarter in the Fed Cycle Source: S&P Global Market Intelligence 1 Fed Rate increase cycle from 3Q2015 through 2Q2019, +225 bps; Fed Rate increase cycle from 4Q2021 through 1Q2024, +525 bps Effective Fed Funds Rate (3Q2015 - 2Q2019) Effective Fed Funds Rate (4Q2021 - Current) 3Q2015 / 4Q2021

 
Over 57% of total loans are variable; 65% of commercial loans have floating rates SUMMARY OF FIXED & FLOATING LOANS 40% 60% Business Total Loans: $6.0B Fixed Variable C om m er ci al 61% 39% Personal RE Total Loans: $3.0B C on su m er 100% HELOC Total Loans: $0.3B 41% 59% Business RE Total Loans: $3.7B 95% 5% Consumer Card Total Loans: $0.6B 73% 27% Consumer Total Loans: $2.1B 18 97% 3% Construction Total Loans: $1.4B Source: 2023 10-K

 
9% 12% 55% 19% 5% Composition of AFS Portfolio Treasury & agency Municipal MBS Other asset backed Corporate HIGH QUALITY, HIGHLY LIQUID AND DIVERSE INVESTMENT PORTFOLIO 1Excludes inflation effect on TIPs; 2Tax equivalent yield Duration (yrs)Avg RateQTD – March 31, 2024 2.51.61%Treasury & agency1 5.21.97%2Municipal 5.12.19%MBS 1.02.39%Other asset-backed 3.31.93%Corporate 4.22.18%Total 19 Total available for sale securities Average balance: $9.5 billion, at fair value As of March 31, 2024

 
Average Loan to Deposit Ratio3 SOUND CAPITAL AND LIQUIDITY POSITION 20 Tier 1 Risk-Based Capital Ratio1 1S&P Global Market Intelligence, Information as of December 31, 2023 2Period-end balances, as of March 31, 2024 3Includes loans held for sale, for the quarter ended March 31, 2024 15.5% 15.3% 13.7% 13.1% 12.6% 12.3% 12.1% 12.1% 12.1% 11.8% 11.7% 11.4% 11.2% 11.2% 11.1% 10.9% 10.8% 10.3% 10.3% 10.0% PB CBSH CFR UBSI UCBI HWC SFNC BOKF CADE SSB OZK ONB ABCB FULT FIBK UMBF PNFP FNB WTFC ASB Peer Median: 11.7% Core Deposits $22.0 Billion2 Large, stable deposit base Loan to Deposit Ratio Total Deposits 70% Average Loan to Deposit Ratio184% 90%10% Core Deposits - Non-Interest Bearing - Interest Checking - Savings and Money MarketCertificates of Deposits Commerce Peer Average

 
$7.8 $7.3 $5.8 $93.2 $118.2 1Q23 4Q23 1Q24 $6.8 $8.0 $8.9 $6.1 $10.1 1Q23 4Q23 1Q24 MAINTAINING STRONG CREDIT QUALITY 21 Net Loan Charge-Offs (NCOs) $ in millions NCOs- CBSH NCOs - Peer Average NCO/Average Loans1 - CBSH $159.3 $162.4 $160.5 $280.5 $312.1 1Q23 4Q23 1Q24 Allowance for Credit Losses on Loans (ACL) $ in millions ACL - CBSH ACL - Peer Average ACL / Total Loans - CBSH Non-Accrual Loans (NALs) $ in millions NALs - CBSH NALs - Peer Average 20.4x 22.2x 27.7x 4.6x 3.8x 1Q23 4Q23 1Q24 Allowance for Credit Losses on Loans (ACL) to NALs ACL / NALs - CBSH ACL / NALs - Peer AverageNALs / Total Loans - CBSH NCO/Average Loans1 – Peer Average .05% NALs / Total Loans – Peer Average .04% .03% .38% .46% ACL / Total Loans – Peer Average .96% .94% .93% 1.17% 1.24% .17% .19% .21% .10% .16% Percentages are illustrative and not to scale; Peer Banks include: ABCB, ASB, BOKF, CADE, CFR, FIBK, FNB, FULT, HWC, ONB, OZK, PB, PNFP, SFNC, SSB, UBSI, UCBI, UMBF, WTFC 1As a percentage of average loans (excluding loans held for sale)

 
ALLOCATION OF ALLOWANCE 22 CECL allowances reflect the economic and market outlook March 31, 2024Dec. 31, 2023 % of Outstanding Loans Allowance for Credit Losses (ACL) % of Outstanding Loans Allowance for Credit Losses (ACL)$ in millions .73%$ 43.8.78%$ 47.1Business .81%30.2 .80%29.7 Bus R/E 2.10%31.42.17%31.4Construction .94%$ 105.5.97%$ 108.2Commercial total .56%11.9 .56%11.6 Consumer 5.13%28.94.86%28.7Consumer CC .40%12.3.40%12.0Personal R/E .56%1.8.55%1.8Revolving H/E .30%.1 1.62%.1 Overdrafts .90%$ 55.0 .90%$ 54.2 Consumer total .93%$ 160.5.94%$ 162.4Allowance for credit losses on loans 1.07% 0.88% 0.90% 0.92% 0.96% 0.94% 0.95% 0.94% 0.93% 0.60% 0.80% 1.00% 1.20% 1.40% $100 $150 $200 $125 $175 $225 $162.8 3Q $150.0 0.99% 4Q $134.7 0.87% 1Q $138.0 2Q $143.4 1/1 $150.1 4Q $159.3 1Q $158.7 $139.6 2Q $162.2 0.95% 3Q $200.5 1Q 4Q $160.5 1Q3Q $172.4 1.10% 1.22% 2Q $162.4 Allowance for Credit Losses (ACL) on Loans ACL - Loans (left) ACL / Total Loans (right) $ in millions 202220212020 2023 2024

 
Quick Facts: Small Business Investment Company (SBIC) founded in 1959 Nationwide footprint with Greater Midwest Focus 36 Portfolio Companies Representing $960.2 million in Revenue Over 3,300 Employees Fair Value as of March 31, 2024: $183.7 million Investment Criteria • Manufacturing, distribution and certain service companies • Cash flow positive • Good management • Consistent financial performers • Operate in niche markets • Significant and defensible market positions • Differentiated products and services • Scalable business platforms Target Parameters • Revenues - $10 million to $100 million • EBITDA - $2 million to $7 million CAPITAL FOR BUSINESS® A middle-market private equity firm focused on the success of industrial growth companies Transaction Types Management buyouts Leveraged buyouts Succession plans Recapitalizations Corporate divestitures Investment Structures Subordinated debt Preferred stock Common stock Warrants Other Information Co-investors Majority control Target 5-7 year hold period Management participation 23

 
NON-GAAP RECONCILIATIONS 24 For The Three Months Ended Mar. 31, 2023Dec. 31, 2023Mar. 31, 2024(DOLLARS IN THOUSANDS) 251,623$248,421$248,999$Net Interest IncomeA 137,612$144,879$148,848$Non-Interest IncomeB 224,107$251,254$245,697$Non-Interest ExpenseC 165,128$142,046$152,150$Pre-Provision Net Revenue (A+B-C) Pre-tax, Pre-provision Net Revenue