株探米国株
日本語 英語
エドガーで原本を確認する
False000002235600000223562024-07-182024-07-18

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): July 18, 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 July 18, 2024 by Commerce Bancshares, Inc. announcing Second 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 July 18, 2024
99.2    Slide presentation for investors and analysts dated July 18, 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: July 18, 2024


EX-99.1 2 cbsh6302024ex991.htm EX-99.1 Document
Exhibit 99.1
Exhibit 99.1
commercebancshares914a01a05.jpg
 CBSH
                   1000 Walnut Street / Suite 700 / Kansas City, Missouri 64106 / 816.234.2000
FOR IMMEDIATE RELEASE:
Thursday, July 18, 2024

COMMERCE BANCSHARES, INC. REPORTS
SECOND QUARTER EARNINGS PER SHARE OF $1.07

Commerce Bancshares, Inc. announced earnings of $1.07 per share for the three months ended June 30, 2024, compared to $.97 per share in the same quarter last year and $.86 per share in the first quarter of 2024. Net income for the second quarter of 2024 amounted to $139.6 million, compared to $127.8 million in the second quarter of 2023 and $112.7 million in the prior quarter.

For the six months ended June 30, 2024, earnings per share totaled $1.93, compared to $1.88 for the first six months of 2023. Net income amounted to $252.2 million for the six months ended June 30, 2024, compared to $247.2 million in the comparable period last year. For the year to date, the return on average assets was 1.67%, and the return on average equity was 16.98%.

In announcing these results, John Kemper, President and Chief Executive Officer, said, “Our earnings remained strong this quarter, driven by an expanding net interest margin, solid fee income, and well-controlled expenses. Our net interest margin expanded 22 basis points this quarter, attributable to a repositioning of some of our available for sale securities, continued benefit from asset repricing and inflation income on treasury bonds. Interest-bearing deposit costs continue to flatten, increasing just two basis points this quarter. Trust fees and deposit account fees were up 10.6% and 11.9%, respectively, over the same period last year.

“We continue to maintain strong capital and liquidity levels. Credit quality across our entire loan portfolio remains excellent, with non-accrual loans at just 11 basis points of total loans.”

Kemper added, “We are pleased to announce that the Company contributed $5.0 million to the Commerce Bancshares Foundation during the second quarter. This donation underscores our commitment to supporting and empowering the growth and prosperity of our communities. Through our contribution to the Foundation, we look forward to maintaining a lasting positive impact on the organizations who do so much for the areas we serve.”

Second Quarter 2024 Financial Highlights:

•Net interest income was $262.2 million, a $13.3 million increase over the prior quarter. The net yield on interest earning assets increased 22 basis points to 3.55%.

•Non-interest income totaled $152.2 million, an increase of $4.6 million compared to the same quarter last year.

•Trust fees grew $5.0 million, or 10.6%, compared to the same period last year, mostly due to higher private client fees.

1
Exhibit 99.1
•Non-interest expense totaled $232.2 million, an increase of $4.6 million, or 2.0%, compared to the same quarter last year and included a $5.0 million donation to a related charitable foundation.

•Average loan balances totaled $17.2 billion, an increase of .6% compared to the prior quarter.

•Total average available for sale debt securities decreased $695.1 million from the prior quarter to $8.8 billion, at fair value. During the second quarter of 2024, the unrealized loss on available for sale debt securities decreased $173.4 million to $1.1 billion, at period end.

•Investment securities gains included a $177.0 million gain on Visa Inc. stock and a $179.1 million loss on the repositioning of a portion of the Company’s available for sale debt securities portfolio.

•Total average deposits decreased $164.5 million, or .7%, compared to the prior quarter. The average rate paid on interest bearing deposits in the current quarter was 1.99%.

•The ratio of annualized net loan charge-offs to average loans was .23% compared to .21% in the prior quarter.

•The allowance for credit losses on loans decreased $1.9 million during the second quarter to $158.6 million, and the ratio of the allowance for credit losses on loans to total loans was .92%, at June 30, 2024, compared to .93% at March 31, 2024.

•Total assets at June 30, 2024 were $30.6 billion, an increase of $197.3 million, or .6%, compared to the prior quarter.

•For the quarter, the return on average assets was 1.86%, the return on average equity was 18.52%, and the efficiency ratio was 55.9%.

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 For the Six Months Ended
(Unaudited)
(Dollars in thousands, except per share data)		 Jun. 30, 2024 Mar. 31, 2024 Jun. 30, 2023 Jun. 30, 2024 Jun. 30, 2023
FINANCIAL SUMMARY
Net interest income $262,249  $248,999  $249,538  $511,248  $501,161 
Non-interest income 152,244  148,848  147,605  301,092  285,217 
Total revenue 414,493  397,847  397,143  812,340  786,378 
Investment securities gains (losses) 3,233  (259) 3,392  2,974  3,086 
Provision for credit losses 5,468  4,787  6,471  10,255  17,927 
Non-interest expense 232,214  245,697  227,611  477,911  451,718 
Income before taxes 180,044  147,104  166,453  327,148  319,819 
Income taxes 38,602  31,652  35,990  70,254  68,803 
Non-controlling interest expense 1,889  2,789  2,674  4,678  3,775 
Net income attributable to Commerce Bancshares, Inc. $139,553  $112,663  $127,789  $252,216  $247,241 
Earnings per common share:    
Net income — basic $1.07  $0.87  $0.97  $1.94  $1.88 
Net income — diluted $1.07  $0.86  $0.97  $1.93  $1.88 
Effective tax rate 21.67  % 21.93  % 21.97  % 21.79  % 21.77  %
Fully-taxable equivalent net interest income $264,578  $251,312  $251,757  $515,890  $505,168 
Average total interest earning assets (1)
 $30,016,060  $30,365,774  $32,412,084  $ 30,190,917  $31,992,669 
Diluted wtd. average shares outstanding 128,610,693  129,185,903  130,207,664  128,898,298  130,339,067 
RATIOS    
Average loans to deposits (2)
 70.73  % 69.87  % 66.15  % 70.30  % 65.57  %
Return on total average assets 1.86  1.48  1.56  1.67  1.55 
Return on average equity (3)
 18.52  15.39  18.81  16.98  18.78 
Non-interest income to total revenue 36.73  37.41  37.17  37.06  36.27 
Efficiency ratio (4)
 55.95  61.67  57.22  58.75  57.35 
Net yield on interest earning assets 3.55  3.33  3.12  3.44  3.18 
EQUITY SUMMARY    
Cash dividends per share $.270  $.270  $.257  $.540  $.514 
Cash dividends on common stock $34,960  $35,140  $33,744  $70,100  $67,503 
Book value per share (5)
 $24.48  $22.70  $20.50 
Market value per share (5)
 $55.78  $53.20  $46.38 
High market value per share $57.48  $55.64  $56.16 
Low market value per share $50.92  $49.44  $43.38 
Common shares outstanding (5)
 129,004,231  129,694,606  130,971,572 
Tangible common equity to tangible assets (6)
 9.82  % 9.24  % 7.70  %
Tier I leverage ratio 12.13  % 11.75  % 10.46  %
OTHER QTD INFORMATION  
Number of bank/ATM locations 247  254  272 
Full-time equivalent employees 4,724  4,721  4,680 
(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 For the Six Months Ended
Jun. 30, 2024 Mar. 31, 2024 Dec. 31, 2023 Sep. 30, 2023 Jun. 30, 2023 Jun. 30, 2024 Jun. 30, 2023
Interest income $369,363  $358,721  $362,609  $361,162  $348,663  $728,084  $657,520 
Interest expense 107,114  109,722  114,188  112,615  99,125  216,836  156,359 
Net interest income 262,249  248,999  248,421  248,547  249,538  511,248  501,161 
Provision for credit losses 5,468  4,787  5,879  11,645  6,471  10,255  17,927 
Net interest income after credit losses 256,781  244,212  242,542  236,902  243,067  500,993  483,234 
NON-INTEREST INCOME      
Trust fees 52,291  51,105  49,154  49,207  47,265  103,396  92,593 
Bank card transaction fees 47,477  46,930  47,878  46,899  49,725  94,407  96,379 
Deposit account charges and other fees 25,325  24,151  23,517  23,090  22,633  49,476  44,385 
Consumer brokerage services 4,478  4,408  3,641  3,820  4,677  8,886  9,762 
Capital market fees 4,760  3,892  4,269  3,524  2,945  8,652  6,307 
Loan fees and sales 3,431  3,141  2,875  2,966  2,735  6,572  5,324 
Other 14,482  15,221  13,545  13,443  17,625  29,703  30,467 
Total non-interest income 152,244  148,848  144,879  142,949  147,605  301,092  285,217 
INVESTMENT SECURITIES GAINS (LOSSES), NET 3,233  (259) 7,601  4,298  3,392  2,974  3,086 
NON-INTEREST EXPENSE      
Salaries and employee benefits 149,120  151,801  147,456  146,805  145,429  300,921  289,802 
Data processing and software 31,529  31,153  31,141  30,744  28,719  62,682  56,873 
Net occupancy 12,544  13,574  13,927  13,948  12,995  26,118  25,754 
Deposit insurance 2,354  8,017  20,304  4,029  4,187  10,371  8,830 
Equipment 5,091  5,010  5,137  4,697  4,864  10,101  9,714 
Marketing 5,356  4,036  6,505  6,167  6,368  9,392  11,839 
Supplies and communication 4,636  4,744  5,242  4,963  4,625  9,380  9,215 
Other 21,584  27,362  21,542  16,657  20,424  48,946  39,691 
Total non-interest expense 232,214  245,697  251,254  228,010  227,611  477,911  451,718 
Income before income taxes 180,044  147,104  143,768  156,139  166,453  327,148  319,819 
Less income taxes 38,602  31,652  32,307  33,439  35,990  70,254  68,803 
Net income 141,442  115,452  111,461  122,700  130,463  256,894  251,016 
Less non-controlling interest expense (income) 1,889  2,789  2,238  2,104  2,674  4,678  3,775 
Net income attributable to Commerce Bancshares, Inc. $139,553  $112,663  $109,223  $120,596  $127,789  $252,216  $247,241 
Net income per common share — basic $1.07  $0.87  $0.84  $0.92  $0.97  $1.94  $1.88 
Net income per common share — diluted $1.07  $0.86  $0.84  $0.92  $0.97  $1.93  $1.88 
OTHER INFORMATION
Return on total average assets 1.86  % 1.48  % 1.38  % 1.49  % 1.56  % 1.67  % 1.55  %
Return on average equity (1)
 18.52  15.39  16.48  17.73  18.81  16.98  18.78 
Efficiency ratio (2)
 55.95  61.67  63.80  58.15  57.22  58.75  57.35 
Effective tax rate 21.67  21.93  22.83  21.71  21.97  21.79  21.77 
Net yield on interest earning assets 3.55  3.33  3.17  3.11  3.12  3.44  3.18 
Fully-taxable equivalent net interest income $264,578  $251,312  $250,547  $250,962  $251,757  $515,890  $505,168 
(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, $1.1 million, and $406 thousand from other non-interest income to capital market fees for the second and third quarters of 2023 and the first six months of 2023, respectively.

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

(Unaudited)
(In thousands)		 Jun. 30, 2024 Mar. 31, 2024 Jun. 30, 2023
ASSETS      
Loans
     Business $ 6,090,724  $ 5,994,974  $ 5,906,493 
     Real estate — construction and land 1,396,515  1,497,647  1,451,783 
     Real estate — business 3,572,539  3,711,602  3,621,222 
     Real estate — personal 3,055,182  3,039,885  2,980,599 
     Consumer 2,145,609  2,119,308  2,110,605 
     Revolving home equity 331,381  322,523  303,845 
     Consumer credit card 566,925  564,388  574,755 
     Overdrafts 4,190  48,513  7,237 
Total loans 17,163,065  17,298,840  16,956,539 
Allowance for credit losses on loans (158,557) (160,465) (158,685)
Net loans 17,004,508  17,138,375  16,797,854 
Loans held for sale 2,930  2,328  6,776 
Investment securities:
Available for sale debt securities 8,534,271  9,141,695  10,414,625 
Trading debt securities 45,499  56,716  29,412 
Equity securities 113,584  12,852  12,266 
Other securities 223,798  229,146  258,045 
Total investment securities 8,917,152  9,440,409  10,714,348 
Federal funds sold —  —  2,750 
Securities purchased under agreements to resell 475,000  225,000  825,000 
Interest earning deposits with banks 2,215,057  1,609,614  2,568,695 
Cash and due from banks 329,692  291,040  366,699 
Premises and equipment — net 467,256  467,377  451,568 
Goodwill 146,539  146,539  146,371 
Other intangible assets — net 13,801  13,918  14,666 
Other assets 997,423  1,037,508  936,535 
Total assets $ 30,569,358  $ 30,372,108  $ 32,831,262 
LIABILITIES AND STOCKHOLDERS’ EQUITY      
Deposits:      
Non-interest bearing $ 7,492,751  $ 7,513,464  $ 8,198,849 
Savings, interest checking and money market 14,367,710  14,463,211  14,418,974 
Certificates of deposit of less than $100,000 1,010,251  997,979  1,543,424 
Certificates of deposit of $100,000 and over 1,408,548  1,465,541  1,708,197 
Total deposits 24,279,260  24,440,195  25,869,444 
Federal funds purchased and securities sold under agreements to repurchase 2,551,399  2,505,576  2,878,021 
Other borrowings 3,984  2,359  1,005,613 
Other liabilities 576,380  460,089  392,956 
Total liabilities 27,411,023  27,408,219  30,146,034 
Stockholders’ equity:      
Common stock 655,322  655,322  629,319 
Capital surplus 3,153,107  3,148,649  2,921,365 
Retained earnings 235,299  130,706  211,358 
Treasury stock (98,176) (59,674) (58,389)
Accumulated other comprehensive income (loss) (807,817) (931,027) (1,036,295)
Total stockholders’ equity 3,137,735  2,943,976  2,667,358 
Non-controlling interest 20,600  19,913  17,870 
Total equity 3,158,335  2,963,889  2,685,228 
Total liabilities and equity $ 30,569,358  $ 30,372,108  $ 32,831,262 

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

(Unaudited)
(In thousands)		 For the Three Months Ended
Jun. 30, 2024 Mar. 31, 2024 Dec. 31, 2023 Sep. 30, 2023 Jun. 30, 2023
ASSETS:
Loans:
Business $ 5,980,364  $ 5,873,525  $ 5,861,229  $ 5,849,227  $ 5,757,388 
Real estate — construction and land 1,471,504  1,472,554  1,523,682  1,508,850  1,450,196 
Real estate — business 3,666,057  3,727,643  3,644,589  3,642,010  3,540,851 
Real estate — personal 3,044,943  3,031,193  3,027,664  2,992,500  2,960,962 
Consumer 2,127,650  2,082,490  2,117,268  2,102,281  2,098,523 
Revolving home equity 326,204  322,074  310,282  304,055  300,623 
Consumer credit card 552,896  562,892  568,112  564,039  555,875 
Overdrafts 4,856  7,696  5,258  5,341  4,630 
Total loans
17,174,474  17,080,067  17,058,084  16,968,303  16,669,048 
Allowance for credit losses on loans (159,791) (161,891) (161,932) (158,335) (159,068)
Net loans 17,014,683  16,918,176  16,896,152  16,809,968  16,509,980 
Loans held for sale 2,455  2,149  5,392  5,714  5,957 
Investment securities:
U.S. government and federal agency obligations 1,201,954  851,656  889,390  986,284  1,035,651 
Government-sponsored enterprise obligations 55,634  55,652  55,661  55,676  55,751 
State and municipal obligations 1,069,934  1,330,808  1,363,649  1,391,541  1,532,519 
Mortgage-backed securities 5,553,656  5,902,328  6,022,502  6,161,348  6,316,224 
Asset-backed securities 1,785,598  2,085,050  2,325,089  2,553,562  2,827,911 
Other debt securities
364,828  503,204  510,721  514,787  519,988 
Unrealized gain (loss) on debt securities (1,272,127) (1,274,125) (1,595,845) (1,458,141) (1,331,002)
Total available for sale debt securities 8,759,477  9,454,573  9,571,167  10,205,057  10,957,042 
Trading debt securities
46,565  40,483  37,234  35,044  46,493 
Equity securities 127,584  12,768  12,249  12,230  12,335 
Other securities 228,403  221,695  222,378  237,518  273,587 
Total investment securities 9,162,029  9,729,519  9,843,028  10,489,849  11,289,457 
Federal funds sold 1,612  599  1,194  2,722  7,484 
Securities purchased under agreements to resell 303,586  340,934  450,000  712,472  824,974 
Interest earning deposits with banks 2,099,777  1,938,381  2,387,415  2,337,744  2,284,162 
Other assets 1,651,808  1,715,716  1,797,849  1,750,222  1,941,340 
Total assets $ 30,235,950  $ 30,645,474  $ 31,381,030  $ 32,108,691  $ 32,863,354 
LIABILITIES AND EQUITY:
Non-interest bearing deposits $ 7,297,955  $ 7,328,603  $ 7,748,654  $ 7,939,190  $ 8,224,475 
Savings 1,328,989  1,333,983  1,357,733  1,436,149  1,516,887 
Interest checking and money market 13,162,118  13,215,270  13,166,783  13,048,199  12,918,399 
Certificates of deposit of less than $100,000 1,003,798  976,804  1,097,224  1,423,965  1,075,110 
Certificates of deposit of $100,000 and over 1,492,592  1,595,310  1,839,057  1,718,126  1,472,208 
Total deposits 24,285,452  24,449,970  25,209,451  25,565,629  25,207,079 
Borrowings:
Federal funds purchased 265,042  328,216  473,534  508,851  507,165 
Securities sold under agreements to repurchase 2,254,849  2,511,959  2,467,118  2,283,020  2,206,612 
Other borrowings 838  76  179,587  685,222  1,617,952 
Total borrowings 2,520,729  2,840,251  3,120,239  3,477,093  4,331,729 
Other liabilities 399,080  410,310  421,402  367,741  598,915 
Total liabilities 27,205,261  27,700,531  28,751,092  29,410,463  30,137,723 
Equity 3,030,689  2,944,943  2,629,938  2,698,228  2,725,631 
Total liabilities and equity $ 30,235,950  $ 30,645,474  $ 31,381,030  $ 32,108,691  $ 32,863,354 

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

(Unaudited) For the Three Months Ended
Jun. 30, 2024 Mar. 31, 2024 Dec. 31, 2023 Sep. 30, 2023 Jun. 30, 2023
ASSETS:  
Loans:  
Business (1)
 6.11  % 6.07  % 5.91  % 5.77  % 5.58  %
Real estate — construction and land 8.36  8.40  8.34  8.17  7.92 
Real estate — business 6.26  6.26  6.18  6.13  5.96 
Real estate — personal 4.04  3.95  3.85  3.73  3.68 
Consumer 6.56  6.40  6.21  5.97  5.63 
Revolving home equity 7.68  7.70  7.70  7.76  7.55 
Consumer credit card 13.96  14.11  13.83  13.77  13.77 
Overdrafts —  —  —  —  — 
Total loans 6.30  6.27  6.15  6.02  5.84 
Loans held for sale 7.54  7.49  9.93  10.55  10.17 
Investment securities:  
U.S. government and federal agency obligations 5.04  2.08  2.32  2.31  3.42 
Government-sponsored enterprise obligations 2.39  2.39  2.36  2.36  2.38 
State and municipal obligations (1)
 2.00  1.97  1.94  1.95  2.04 
Mortgage-backed securities 2.09  2.19  2.05  2.06  2.09 
Asset-backed securities 2.50  2.39  2.30  2.20  2.08 
Other debt securities 2.01  1.93  1.85  1.75  1.86 
Total available for sale debt securities 2.50  2.18  2.10  2.08  2.19 
Trading debt securities (1)
 4.95  5.30  5.05  5.11  4.53 
Equity securities (1)
 2.82  25.64  27.47  23.06  23.25 
Other securities (1)
 13.20  13.04  8.60  13.13  9.40 
Total investment securities 2.75  2.44  2.27  2.33  2.37 
Federal funds sold 6.74  6.71  6.65  6.56  5.63 
Securities purchased under agreements to resell 3.21  1.93  1.64  2.08  1.99 
Interest earning deposits with banks 5.48  5.48  5.47  5.39  5.14 
Total interest earning assets 4.98  4.78  4.62  4.51  4.34 
LIABILITIES AND EQUITY:  
Interest bearing deposits:  
Savings .06  .06  .05  .05  .05 
Interest checking and money market 1.73  1.69  1.57  1.33  .93 
Certificates of deposit of less than $100,000 4.22  4.20  4.21  4.32  3.78 
Certificates of deposit of $100,000 and over 4.55  4.56  4.55  4.37  3.93 
Total interest bearing deposits 1.99  1.97  1.93  1.76  1.29 
Borrowings:  
Federal funds purchased 5.42  5.42  5.40  5.33  5.06 
Securities sold under agreements to repurchase 3.44  3.43  3.25  3.20  3.09 
Other borrowings 3.84  —  5.45  5.30  5.24 
Total borrowings 3.65  3.66  3.71  3.93  4.13 
Total interest bearing liabilities 2.21  % 2.21  % 2.20  % 2.12  % 1.87  %
Net yield on interest earning assets 3.55  % 3.33  % 3.17  % 3.11  % 3.12  %
(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 For the Six Months Ended
(Unaudited)
(In thousands, except ratios)		 Jun. 30, 2024 Mar. 31, 2024 Dec. 31, 2023 Sep. 30, 2023 Jun. 30, 2023 Jun. 30, 2024 Jun. 30, 2023
ALLOWANCE FOR CREDIT LOSSES ON LOANS
Balance at beginning of period $160,465  $162,395  $162,244  $158,685  $159,317  $162,395  $150,136 
     Provision for credit losses on loans 7,849  6,947  8,170  13,343  5,864  14,796  21,812 
     Net charge-offs (recoveries):
        Commercial portfolio:
     Business 622  23  96  2,613  165  645  395 
     Real estate — construction and land —  —  —  —  (115) —  (115)
     Real estate — business (8) (141) 128  (15) (5) (149) (9)
614  (118) 224  2,598  45  496  271 
        Personal banking portfolio:
     Consumer credit card 6,746  6,435  5,325  4,716  4,687  13,181  9,012 
     Consumer 1,804  1,983  1,903  1,797  1,273  3,787  2,548 
     Overdraft 521  557  588  683  517  1,078  1,495 
     Real estate — personal 79  24  (11) (9) (6) 103  (17)
     Revolving home equity (7) (4) (10) (1) (20) (11) (46)
9,143  8,995  7,795  7,186  6,451  18,138  12,992 
     Total net loan charge-offs 9,757  8,877  8,019  9,784  6,496  18,634  13,263 
Balance at end of period $158,557  $160,465  $162,395  $162,244  $158,685  $158,557  $158,685 
LIABILITY FOR UNFUNDED LENDING COMMITMENTS $20,705  $23,086  $25,246  $27,537  $29,235 
NET CHARGE-OFF RATIOS (1)
Commercial portfolio:
     Business .04  % —  % .01  % .18  % .01  % .02  % .01  %
     Real estate — construction and land —  —  —  —  (.03) —  (.02)
     Real estate — business —  (.02) .01  —  —  (.01) — 
.02  —  .01  .09  —  .01  .01 
Personal banking portfolio:
     Consumer credit card 4.91  4.60  3.72  3.32  3.38  4.75  3.27 
     Consumer .34  .38  .36  .34  .24  .36  .25 
     Overdraft 43.15  29.11  44.37  50.73  44.79  34.54  66.40 
     Real estate — personal .01  —  —  —  —  .01  — 
     Revolving home equity (.01) —  (.01) —  (.03) (.01) (.03)
.61  .60  .51  .48  .44  .60  .44 
Total .23  % .21  % .19  % .23  % .16  % .22  % .16  %
CREDIT QUALITY RATIOS
Non-accrual loans to total loans .11  % .03  % .04  % .05  % .04  %
Allowance for credit losses on loans to total loans .92  .93  .94  .95  .94 
NON-ACCRUAL AND PAST DUE LOANS
  Non-accrual loans:
     Business $504  $1,038  $3,622  $6,602  $4,732 
     Real estate — business 15,050  1,246  60  76  153 
     Real estate — personal 1,772  1,523  1,653  1,531  1,276 
     Revolving home equity 1,977  1,977  1,977  —  — 
   Total 19,303  5,784  7,312  8,209  6,161 
Loans past due 90 days and still accruing interest $18,566  $20,281  $21,864  $18,580  $15,351 
(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 Second Quarter Results
June 30, 2024
For the quarter ended June 30, 2024, net income amounted to $139.6 million, compared to $112.7 million in the previous quarter and $127.8 million in the same quarter last year. The increase in net income compared to the previous quarter was primarily the result of higher net interest income and lower non-interest expense. The net yield on interest earning assets increased 22 basis points over the previous quarter to 3.55%. Average loans increased $94.4 million over the previous quarter, while average deposits, borrowings and available for sale debt securities, at fair value, declined $164.5 million, $319.5 million, and $695.1 million, respectively. For the quarter, the return on average assets was 1.86%, the return on average equity was 18.52%, and the efficiency ratio was 55.9%.

Balance Sheet Review
During the 2nd quarter of 2024, average loans totaled $17.2 billion, an increase of $94.4 million over the prior quarter, and increased $505.4 million, or 3.0%, over the same quarter last year. Compared to the previous quarter, average balances of business and consumer loans grew $106.8 million and $45.2 million, respectively, while business real estate loans declined $61.6 million. During the current quarter, the Company sold certain fixed rate personal real estate loans totaling $18.2 million, compared to $7.4 million in the prior quarter.

Total average available for sale debt securities decreased $695.1 million compared to the previous quarter to $8.8 billion, at fair value. The decrease in debt securities was mainly the result of lower average balances of mortgage-backed, asset-backed, state and municipal, and other debt securities, partly offset by higher average balances of U.S. government and federal agency obligations. Most of the changes in the debt securities balances resulted from the completion of a plan to reposition a portion of the portfolio, which was announced in May 2024. During the 2nd quarter of 2024, the unrealized loss on available for sale debt securities decreased $173.4 million to $1.1 billion, at period end. Also, during the 2nd quarter of 2024, purchases of securities totaled $928.8 million with a weighted average yield of approximately 4.60%, and sales, maturities and pay downs were $1.7 billion. At June 30, 2024, the duration of the available for sale investment portfolio was 4.0 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 $164.5 million this quarter compared to the previous quarter. The decrease in deposits mostly resulted from a decline of $102.7 million in average balances of certificates of deposit greater than $100,000. Compared to the previous quarter, total average commercial deposits declined $317.0 million, while average consumer deposits increased $136.3 million. The average loans
to deposits ratio was 70.7% in the current quarter and 69.9% in the prior quarter. The Company’s average borrowings, which included average customer repurchase agreements of $2.3 billion, decreased $319.5 million to $2.5 billion in the 2nd quarter of 2024.

Net Interest Income
Net interest income in the 2nd quarter of 2024 amounted to $262.2 million, an increase of $13.3 million over the previous quarter. On a fully taxable-equivalent (FTE) basis, net interest income for the current quarter increased $13.3 million over the previous quarter to $264.6 million. The increase in net interest income was mostly due to higher interest income on investment securities, loans, and deposits with banks, coupled with lower interest expense on borrowings. The net yield (FTE) on earning assets increased to 3.55%, from 3.33% in the prior quarter.

Compared to the previous quarter, interest income on loans (FTE) increased $2.9 million, due to higher average rates earned on business, consumer, and personal real estate loans. Interest income on loans also increased due to higher average balances of business and consumer loans, partly offset by lower average balances of business real estate loans. The average yield (FTE) on the loan portfolio increased three basis points to 6.30% this quarter.

Interest income on investment securities (FTE) increased $4.7 million over the prior quarter, mostly due to higher rates earned on available for sale debt securities, partly offset by lower average balances of available for sale debt securities. Interest income earned on U.S. government and federal agency securities increased due to higher average balances and rates, which included the impact of $5.9 million in higher inflation income from Treasury inflation-protected securities compared to previous quarter. Additionally, the Company recorded a $740 thousand adjustment to premium amortization at June 30, 2024, which increased interest income to reflect slower forward prepayment speed estimates on mortgage-backed securities but was lower than the $2.0 million adjustment that increased interest income in the prior quarter. The average yield (FTE) on total investment securities was 2.75% in the current quarter, compared to 2.44% in the previous quarter.

Compared to the previous quarter, interest income on deposits with banks increased $2.2 million, due to $161.4 million of higher average balances.

Interest expense decreased $2.6 million, mainly due to lower average borrowing balances, partly offset by higher interest expense on deposits. Interest expense on borrowings decreased $3.0 million due to lower average balances of customer repurchase agreements and federal funds purchased. Interest expense on deposits increased $377 thousand as higher rates paid on deposits were mostly offset by lower average balances. The average rate paid on interest bearing deposits totaled 1.99% in the current quarter compared to 1.97% in the prior quarter.
9
Exhibit 99.1
COMMERCE BANCSHARES, INC.                                
Management Discussion of Second Quarter Results
June 30, 2024
The overall rate paid on interest bearing liabilities was 2.21% in the current and prior quarter.

Non-Interest Income
In the 2nd quarter of 2024, total non-interest income amounted to $152.2 million, an increase of $4.6 million, or 3.1%, over the same period last year and an increase of $3.4 million over the prior quarter. The increase in non-interest income compared to the same period last year was mainly due to higher trust fees, capital market fees, and deposit account fees, partly offset by lower bank card fees and letter of credit fees. The increase in non-interest income compared to the prior quarter was mainly due to higher deposit account fees, trust fees, capital market fees and swap fees, partly offset by lower tax credit sales income. Additionally, a decrease of $1.1 million in fair value adjustments was recorded on the Company’s deferred compensation plan, which are held in a trust and recorded as both an asset and liability, affecting both other income and other expense.

Total net bank card fees in the current quarter decreased $2.2 million, or 4.5%, compared to the same period last year, and increased $547 thousand compared to the prior quarter. Net corporate card fees decreased $3.0 million, or 10.3%, compared to the same quarter of last year mainly due to lower interchange fees and higher rewards expense. Net merchant fees increased $506 thousand, or 9.4%, due to higher interchange fees, partly offset by higher network expense. Net debit card fees increased $43 thousand, or .4%, while net credit card fees increased $221 thousand, or 5.8%. Total net bank card fees this quarter were comprised of fees on corporate card ($26.2 million), debit card ($11.4 million), merchant ($5.9 million) and credit card ($4.0 million) transactions.

In the current quarter, trust fees increased $5.0 million, or 10.6%, over the same period last year, mostly resulting from higher private client fees. Compared to the same period last year, deposit account fees increased $2.7 million, or 11.9%, mostly due to higher corporate cash management fees, while capital market fees increased $1.8 million, or 61.6%, mostly due to higher underwriting fees.

Other non-interest income decreased compared to the same period last year primarily due to lower letter of credit fees and swap fees of $2.3 million and $919 thousand, respectively. For the 2nd quarter of 2024, non-interest income comprised 36.7% of the Company’s total revenue.

Investment Securities Gains and Losses
The Company recorded net securities gains of $3.2 million in the current quarter, compared to losses of $259 thousand in the prior quarter and gains of $3.4 million in the 2nd quarter of 2023. Net securities gains
in the current quarter resulted primarily from gains of $177.0 million recognized on Visa common stock. During the second quarter of 2024, the Company sold 436 thousand shares of Visa Class A common stock (converted from 109 thousand shares of Visa Class C common stock) at an average price of $274.91. As of June 30, 2024, the Company has sold approximately two thirds of the Visa Class C shares it received from the Visa exchange offer. In addition, net gains of $4.1 million were recorded on the Company’s portfolio of private equity investments. These net gains were mostly offset by losses of $179.1 million realized on sales of available for sale debt securities resulting from the completion of the Company’s plan to reposition a portion of its available for sale debt securities portfolio.

Non-Interest Expense
Non-interest expense for the current quarter amounted to $232.2 million, compared to $227.6 million in the same period last year and $245.7 million in the prior quarter. The increase in non-interest expense compared to the same period last year was mainly due to higher salaries expense, data processing and software expense, and other expense, partly offset by lower marketing and deposit insurance expense. The decrease in non-interest expense compared to the prior quarter was mainly due to lower deposit insurance expense, employee benefits expense, and litigation settlement expense recorded in the prior quarter that did not reoccur in the current quarter. These decreases were partly offset by higher salaries expense and a donation to a related charitable foundation.

Compared to the 2nd quarter of last year, salaries and employee benefits expense increased $3.7 million, or 2.5%, mostly due to higher full-time salaries expense of $3.8 million, and other salaries expense of $1.0 million, partly offset by lower medical expense of $1.5 million. Full-time equivalent employees totaled 4,724 and 4,680 at June 30, 2024 and 2023, respectively.

Compared to the same period last year, data processing and software expense increased $2.8 million due to increased costs for service providers. This increase was partly offset by a decrease in deposit insurance expense of $1.8 million, mostly due to a $1.2 million accrual adjustment to the FDIC’s special assessment and lower marketing expense of $1.0 million. Other expense included a $5.0 million donation to a related charitable foundation in the current quarter, partly offset by deconversion expense of $2.1 million recorded in the same period last year.

Income Taxes
The effective tax rate for the Company was 21.7% in the current quarter, 21.9% in the previous quarter, and 22.0% in the 2nd quarter of 2023.

10
Exhibit 99.1
COMMERCE BANCSHARES, INC.                                
Management Discussion of Second Quarter Results
June 30, 2024
Credit Quality
Net loan charge-offs in the 2nd quarter of 2024 amounted to $9.8 million, compared to $8.9 million in the prior quarter and $6.5 million in the same period last year. The ratio of annualized net loan charge-offs to total average loans was .23% in the current quarter, .21% in the previous quarter, and .16% in the 2nd quarter of last year. Compared to the prior quarter, net loan charge-offs on business and consumer credit card loans increased $599 thousand and $311 thousand, respectively.

In the 2nd quarter of 2024, annualized net loan charge-offs on average consumer credit card loans were 4.91%, compared to 4.60% in the previous quarter and 3.38% in the same quarter last year. Consumer loan net charge-offs were .34% of average consumer loans in the current quarter, .38% in the prior quarter, and .24% in the same quarter last year.

At June 30, 2024, the allowance for credit losses on loans totaled $158.6 million, or .92% of total loans, and decreased $1.9 million compared to the prior quarter. Additionally, the liability for unfunded lending commitments at June 30, 2024 was $20.7 million, a decrease of $2.4 million compared to the liability at March 31, 2024.

At June 30, 2024, total non-accrual loans amounted to $19.3 million, an increase of $13.5 million over the previous quarter. The increase in non-accrual loans was mostly due to a senior living business real estate loan that was moved to non-accrual status during the second quarter of 2024. At June 30, 2024, the balance of non-accrual loans, which represented .11% of loans outstanding, included business loans of $504 thousand, revolving home equity loans of $2.0 million, personal real estate loans of $1.8 million, and business real estate loans of $15.1 million. Loans more than 90 days past due and still accruing interest totaled $18.6 million at June 30, 2024.

Other
During the 2nd 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 685,685 shares of treasury stock during the current quarter at an average price of $55.21.

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. Additional information about risks and uncertainties is included
in the "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" sections within the Company's Annual Report on Form 10-K.
11
EX-99.2 3 a2024q2earningshighlight.htm EX-99.2 a2024q2earningshighlight
COMMERCE BANCSHARES, INC. EARNINGS HIGHLIGHTS 2nd Quarter 2024

 
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, 1st Quarter 2024 Report on Form 10- Q and the Corporation’s Current Reports on Form 8-K. 2

 
COMMERCE BANCSHARES 158 YEARS IN BUSINESS 142 branches and 257 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 COMMERCIAL OFFICES Cincinnati • Nashville • Dallas • Des Moines Indianapolis • Grand Rapids • Houston1 WEALTH MANAGEMENT OFFICES Dallas • Houston1 • Naples1 U.S. PRESENCE Extended Market Area Commercial Payments Services Offered in 48 states across the U.S. $30.6 BILLION TOTAL ASSETS 41st LARGEST U.S. BANK BASED ON ASSET SIZE2 $7.2 BILLION MARKET CAP 21st LARGEST U.S. BANK BASED ON MARKET CAP2 $69.9 BILLION TOTAL TRUST ASSETS UNDER ADMINISTRATION 20TH LARGEST AMONG BANK-MANAGED TRUST COMPANIES BASED ON AUM2 15.35% TIER 1 COMMON RISK- BASED CAPITAL RATIO 4TH HIGHEST AMONG TOP 50 U.S. BANKS BASED ON ASSET SIZE2 AS OF Mar. 31, 2024 $24.3 BILLION TOTAL DEPOSITS $17.2 BILLION TOTAL LOANS3 $9.9 BILLION COMMERCIAL CARD VOLUME AS OF DECEMBER 31, 2023 16.98% RETURN ON AVERAGE COMMON EQUITY YTD 3rd YTD ROACE FOR THE 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 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 3/31/2024; 3Includes loans held for sale; 4Moody’s Sector Profile: Banks, May 23, 2024, Baseline Credit Assessment (BCA) reflects a bank’s standalone credit strength; Company reports and filings, information as of 6/30/2024 unless otherwise noted. 3

 
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 $22.9 billion in low-cost, diverse deposits2 with peer-leading historical deposit betas Credit Quality Conservative risk profile drives outperformance across credit cycles Consistent Earnings and Shareholder Value Over 8% total annualized return to shareholders over the last 20 years, outperforming the annualized KBW Regional Bank Index return of 3.3%3 Capital Management Strong capital ratios, 56th consecutive year of common dividend increases4 Continued Long-Term Investments Core banking system implementation, Enterprise Digital, Expansion Markets, Wealth Management, 1As of YTD 6/30/2024; 2Excludes certificates of deposit greater than $100,000, period-end balance as of 6/30/2024; 3As of 6/30/2024; 4Based on 2Q2024 paid dividend 4

 
2Q2024 HIGHLIGHTS Highlights $182.3 million PPNR1 $139.6 million Net Income $1.07 EPS 1.86% ROAA 18.52% ROACE • Net interest income increased 5% over Q1 to $262MM. • Net interest margin expanded 22 bps over Q1 to 3.55%. • Total cost of deposits increased 2 bps to 1.40%, compared to an increase of 4 bps in Q1. • Non-interest income increased 3% over the prior year and was 37% of total revenue. • Non-interest expense increased 2% over the prior year. • Non-interest expense was flat compared to the same period last year excluding a one-time $5MM contribution to the Commerce Bancshares Foundation. • Average loan growth increased 3% over the prior year. • Period end non-interest bearing deposits to total deposits increased slightly over Q1 to 31%. • Net loan charge-offs of .23% and non-accrual loans of .11%. • TCE/TA increased 58 bps over Q1 to 9.82%. Book value per share increase of 8% over Q1 to $24.48. 55.95% Efficiency Ratio Well-positioned for current environment 1See the non-GAAP reconciliation on page 25 5

 
BALANCE SHEET HIGHLIGHTS 2Q24 vs. 2Q23 2Q24 vs. 1Q24 Quarterly Average Balances % Change$ Change% Change$ Change2Q24$ in millions 3%$369.50%$44.2$11,117.9Commercial 2%135.91%50.26,056.5Consumer 3%$505.41%$94.4$17,174.5Total Loans -19%$-2,127.4-6%$-567.5$9,162.0Investment Securities1 -8%$-184.48%$161.4$2,099.8 Interest Earning Deposits with Banks -4%$-921.6-1%$-164.5$24,285.5Deposits 19%$3.988%$1.78$24.48Book Value per Share2 Average Loans: 3% growth over the prior year. Investment securities: Providing liquidity through net sales, maturities and paydowns. Interest Earning Deposits with Banks: Increased 8% over the previous quarter. Average Deposits: Declined from Q1, mostly reflecting CD maturities 1At fair value 2For the quarters ended June 30, 2024, March 31, 2024, and June 30, 2023 6

 
$17.0 $17.1 $17.0 $8.2 $7.3 $7.3 2Q23 1Q24 2Q24 $25.2 $24.4 $24.3 -4% $10.8 $11.1 $11.1 $5.9 $6.0 $6.1 2Q23 1Q24 2Q24 $16.7 $17.1 $17.2 BALANCE SHEET 7 Loans Consumer Loans Commercial Loans Loan Yield1 Deposits QTD Average Balances $ billions Non-Interest Bearing Interest-Bearing Deposits Interest-Bearing Deposit Cost QTD Average Balances $ billions 5.84% 6.27% 6.30% 1.29% 1.97% 1.99% +3% 1Tax equivalent yield

 
LOAN PORTFOLIO 8 YoYQoQ6/30/20233/31/20246/30/2024$ in 000s 3.1%1.6%$5,906,493 $5,994,974$6,090,724Business -3.8%-6.8%1,451,7831,497,6471,396,515Construction -1.3%-3.7%3,621,2223,711,6023,572,539Business Real Estate 2.5%.5%2,980,5993,039,8853,055,182Personal Real Estate 1.7%1.2%2,110,6052,119,3082,145,609Consumer 9.1%2.7%303,845322,523331,381Revolving Home Equity -1.4%.4%574,755564,388566,925Consumer Credit Card -42.1%-91.4%7,23748,5134,190Overdrafts 1.2%-.8%$16,956,539$17,298,840$17,163,065Total Loans Period-End Balances YoYQoQ6/30/20233/31/20246/30/2024$ in 000s 3.9%1.8%$5,757,388$5,873,525$5,980,364Business 1.5%-.1%1,450,1961,472,5541,471,504Construction 3.5%-1.7%3,540,8513,727,6433,666,057Business Real Estate 2.8%.5%2,960,9623,031,1933,044,943Personal Real Estate 1.4%2.2%2,098,5232,082,4902,127,650Consumer 8.5%1.3%300,623322,074326,204Revolving Home Equity -.5%-1.8%555,875562,892552,896Consumer Credit Card 4.9%-36.9%4,6307,6964,856Overdrafts 3.0%.6%$16,669,048$17,080,067$17,174,474Total Loans QTD Average Balances

 
33.1% 14.7% 13.0% 9.0% 8.2% 8.4% 5.5% 5.3% Owner- occupied Office Industrial Retail Multi-family Hotels Farm Senior living 2.8% Other Real Estate - Business Loans: Office Outstanding Balances by Geography1 % of Total Loans Real Estate - Business Loans 6.9%Owner – Occupied 2.7%Industrial 3.1%Office 1.9%Retail 1.7%Multi-Family 1.8%Hotels 1.1%Farm 1.1%Senior living .5%Other 20.8%Total COMMERCIAL REAL ESTATE BREAKDOWN 9 Real Estate - Business Loans $3.6 billion 1Geography determined by location of collateral. Includes only loans with a balance of $1 million and above, which represents 94% 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 94% of outstanding balance of the stabilized, non- owner occupied office loans Real Estate - Business Loans: Office Attributes as of June 30, 2024 48.7% 9.2% 17.8% 5.5% 6.8% MO TX KS OK 4.3% IL 4.7% CO 2.3% OH Other Midwest States 0.7% 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: 3.89% • Weighted Average LTV of Office Loans: 66.5%3 • Percent of loans at floating interest rate: 71.9%

 
$149 $152 $249 $246 1Q24 $398 10 INCOME STATEMENT HIGHLIGHTS $148 $170 $250 $228 2Q23 $398 $152 $182 $262 $232 2Q24 $414 Non-Interest Income (+) Net Interest Income (+) Non-Interest Expense (-) Pre-Tax, Pre-Provision Net Revenue (=) 2Q24 Comparison 7.5%vs. 2Q23 19.8%vs. 1Q24 Pre-Tax, Pre-Provision Net Revenue (PPNR) $ in millions See the non-GAAP reconciliation on page 25 Expenses, declined 5.5% from Q1 and increased 2.0% over the prior year. Revenue was increased 4.2% over Q1 and increased 4.4% over the prior year. Note: Q2 2024 includes an accrual reduction of $1.2MM to the FDIC’s special assessment accrual and a $5MM donation to a related charitable foundation, Q1 2024 includes a $4MM FDIC special assessment accrual adjustment and $10MM in one-time litigation settlement costs.

 
2Q24 vs. 2Q23 2Q24 vs. 1Q24 % Change$ Change% Change$ Change2Q24$ in millions 5%$12.75%$13.3$262.3Net Interest Income 3%$4.62%$3.4$152.2Non-Interest Income 2%$4.6-5%$-13.5$232.2Non-Interest Expense 8%$12.720%$30.1$182.3Pre-Tax, Pre-Provision Net Revenue1 -5%$-.2NM$3.5$3.2Investment Securities Gains, Net -15%$-1.014%$0.7$5.5Provision for Credit Losses 9%$11.824%$26.9$139.6Net-Income Attributable to Commerce Bancshares, Inc. 2Q24 vs. 2Q232Q23 2Q24 vs. 1Q241Q242Q24For the three months ended 10%$.9724%$.86$1.07Net Income per Common Share – Diluted 43 bps3.12%22 bps3.33%3.55%Net Yield on Interest Earning Assets INCOME STATEMENT HIGHLIGHTS 1See the non-GAAP reconciliation on page 25 11

 
NON-INTEREST INCOME HIGHLIGHTS 12 2Q24 vs. 2Q23 2Q24 vs. 1Q24 % Change$ Change% Change$ Change2Q24$ in millions -5%$-2.31%$.5$47.5Bank Card Transaction Fees 11%5.02%1.252.3Trust Fees 12%2.75%1.225.3Deposit Account Charges and Other Fees 62%1.822%.94.8Capital Market Fees -4%-.22%.14.5Consumer Brokerage Services 25%.79%.33.4Loan Fees and Sales -18%-3.1-5%-.714.5Other 3%$4.62%$3.4$152.2Total Non-Interest Income Bank Card Fees: Decrease from the prior year was due to lower corporate card fees. Trust Fees: Increase over the prior year was driven by higher private client fees. Deposit Account Charges and Other Fees: Increase compared to the prior year due to higher corporate cash management fees.

 
NON-INTEREST EXPENSE HIGHLIGHTS 13 2Q24 vs. 2Q23 2Q24 vs. 1Q24 % Change$ Change% Change$ Change2Q24$ in millions 3%$3.7-2%$-2.7$149.1Salaries and Employee Benefits 10%2.81%.431.5Data Processing and Software -3%-.5-8%-1.012.5Net Occupancy -44%-1.8-71%-5.72.4Deposit Insurance 5%.22%.15.1Equipment -16%-1.033%1.35.4Marketing 0%.0-2%-.14.6Supplies and Communication 6%1.2-21%-5.821.6Other 2%$4.6-5%$-13.5$232.2Total Non-Interest Expense Total non-interest expense: Flat over the prior year excluding a one-time $5MM contribution to the Commerce Bancshares Foundation. Salaries and employee benefits: Higher salaries partly offset by lower payroll taxes and other benefits led to decrease from the prior quarter. Deposit Insurance: Includes an accrual reduction of $1.2 million to the FDIC’s special assessment. Other: Includes a contribution to a related charitable foundation of $5.0 million.

 
14 LIQUIDITY AND CAPITAL

 
VISA STOCK & SECURITIES PORTFOLIO REPOSITIONING UPDATE 15 • $177.0 million gain related to Visa shares. • Sold two thirds of Visa Class C shares (converted to Class A) resulting in proceeds of $119.8 million. • Sold $1.2 billion (amortized cost) of AFS debt securities at a $179.1 million loss. • Purchased $928.8 million of AFS securities, with approximate yields of 4.6%, and $250.0 million of repo securities at approximate yields of 4.1%. 2Q24 vs. 1Q24Period-End Balances $ Change2Q241Q24$ in millions $889$1,717$828U.S. government and federal agency obligations $(409)$870$1,279State and municipal obligations $(693)$5,141$5,834Mortgage-backed securities $(307)$1,647$1,954Asset-backed securities $(259)$234$493Other debt securities $173$(1,074)$(1,247)Unrealized gain or loss on debit securities $(608)$8,534$9,142Total available for sale debt securities $250$475$225 Securities purchased under agreements to resell 2.1% 4.6% Approximate yield of AFS securities sold for repositioning Approximate reinvestment yields of AFS securities +250 bps AFS Securities Repositioning Yields

 
LIQUIDITY AND CAPITAL HIGHLIGHTS 16 • $2.2B in cash at Federal Reserve Bank (FRB) at Q2. • AFS debt securities portfolio duration of 4.0 years. • Investment securities purchases in Q2 totaled $928.8MM at a weighted average yield of approximately 4.60%. • Cash flows from maturities and paydowns of investments and resale agreements of approximately $1.7B expected over the next twelve months. – AFS debt securities of $1.6B – Securities purchased under agreements to resell of $125MM Liquidity • TCE/TA of 9.82%, an increase of 58 bps over Q1. Tier 1 leverage at 12.13%. • Purchased $37.9MM of common stock vs. $42.0MM in Q1. • AOCI loss decreased from $(931MM) at Q1 to $(808MM) at Q2. • Book value per share increased 8% over Q1 to $24.48. Capital • QTD Average loan to deposit ratio of 71%. • Optimizing sources and uses of funding, allowing high cost CDs to mature. • Total deposits at period end decreased $161MM. • Total average deposits decreased $165MM and customer repurchase agreements decreased $257MM. Balance Sheet / Deposits

 
2021 2022 4Q23 1Q24 2Q24 $3.0 $2.8 $2.3 $2.4 $2.4 2020 $2.3 DEPOSIT BALANCE TRENDS Segment view $ in billions 17 2021 2022 4Q23 1Q24 2Q24 $12.0 $11.9 $10.6 $9.9 $9.5 2020 $9.9 2021 2022 4Q23 1Q24 2Q24 $12.8 $13.4 $12.1 $12.2 $12.4 2020 $11.3 Commercial Consumer Wealth Average Balance 4Q23 1Q24 2Q24 $12.4 $12.6 $12.5 Period EndAverage Balance Average Balance Segment balances do not include brokered deposits. 2020 through 2022 are full year average balances. 4Q23 1Q24 2Q24 $10.4 $9.3 $9.4 Period End 4Q23 1Q24 2Q24 $2.5 $2.4 $2.3 Period End

 
0.0% 1.0% 2.0% 3.0% 4.0% 5.0% 6.0% 0 1 2 3 4 5 6 7 8 9 10 Quarter in the Fed Cycle 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 4/2025. • 2.75% floor contract with a notional value of $500 million. The contract begins 7/2025. WELL-POSITIONED FOR MULTIPLE RATE ENVIRONMENTS 18 Opportunities to enhance and protect NII. • Net yield on interest earning assets increased 22 bps over Q1 to 3.55%. • Loan yield increased 3 bps over Q1 to 6.30%. • Total deposit costs were up 2 bps compared to Q1 at 1.40%. • 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 Cost of Total Deposits Deposit Beta1 End of Fed Rate Increases / Current Before Fed Rate Increases 26%1.40%.03%Commerce (4Q2021 – 2Q2024) 41%2.27%.23%Peer Median (4Q2021 – 1Q2024) Source: S&P Global Market Intelligence 1 Fed Rate increase cycle from 4Q2021 through 2Q2024, +525 bps Effective Fed Funds Rate (4Q2021 - Current) 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 19 97% 3% Construction Total Loans: $1.4B Source: 2023 10-K

 
13% 11% 55% 18% 4% Composition of AFS Portfolio Treasury & agency Municipal MBS Asset-backed Other debt HIGH QUALITY, HIGHLY LIQUID AND DIVERSE INVESTMENT PORTFOLIO 1Excludes inflation effect on TIPs; 2Tax equivalent yield Duration (yrs)Avg RateQTD – June 30, 2024 3.02.74%Treasury & agency1 4.82.00%2Municipal 5.52.09%MBS 1.02.50%Asset-backed 2.32.01%Other debt 4.02.50%Total 20 Total available for sale securities Average balance: $8.8 billion, at fair value As of June 30, 2024

 
Average Loan to Deposit Ratio3 SOUND CAPITAL AND LIQUIDITY POSITION 21 Tier 1 Risk-Based Capital Ratio1 1S&P Global Market Intelligence, Information as of March 31, 2024 2Period-end balances, as of June 30, 2024 3Includes loans held for sale, for the quarter ended June 30, 2024 15.8% 15.4% 14.3% 13.9% 13.2% 12.8% 12.7% 12.2% 12.0% 12.0% 12.0% 11.5% 11.4% 11.4% 11.4% 11.1% 11.1% 10.9% 10.2% 10.0% PB CBSH HOMB CFR UBSI UCBI HWC CADE BOKF SSB SFNC OZK ONB FIBK ABCB FULT UMBF PNFP FNB ASB Peer Median: 12.0% Core Deposits $21.9 Billion2 Large, stable deposit base Loan to Deposit Ratio Total Deposits 71% Average Loan to Deposit Ratio184% 90%10% Core Deposits - Non-Interest Bearing - Interest Checking - Savings and Money MarketCertificates of Deposits Commerce Peer Average

 
$6.2 $5.8 $19.3 $105.4 $130.7 2Q23 1Q24 2Q24 $6.5 $8.9 $9.8 $7.5 $9.2 2Q23 1Q24 2Q24 MAINTAINING STRONG CREDIT QUALITY 22 Net Loan Charge-Offs (NCOs) $ in millions NCOs- CBSH NCOs - Peer Average NCO/Average Loans1 - CBSH $158.7 $160.5 $158.6 $297.1 $315.8 2Q23 1Q24 2Q24 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 25.8x 27.7x 8.2x 3.9x 3.3x 2Q23 1Q24 2Q24 Allowance for Credit Losses on Loans (ACL) to NALs ACL / NALs - CBSH ACL / NALs - Peer AverageNALs / Total Loans - CBSH NCO/Average Loans1 – Peer Average .04% NALs / Total Loans – Peer Average .03% .11% .44% .54% ACL / Total Loans – Peer Average .94% .93% .92% 1.27% 1.31% .16% .21% .23% .13% .15% Percentages are illustrative and not to scale; Peer Banks include: ABCB, ASB, BOKF, CADE, CFR, FIBK, FNB, FULT, HWC, HOMB, ONB, OZK, PB, PNFP, SFNC, SSB, UBSI, UCBI, UMBF 1As a percentage of average loans (excluding loans held for sale)

 
ALLOCATION OF ALLOWANCE 23 CECL allowances reflect the economic and market outlook June 30, 2024March 31, 2024 % of Outstanding Loans Allowance for Credit Losses (ACL) % of Outstanding Loans Allowance for Credit Losses (ACL)$ in millions .74%$ 45.1.73%$ 43.8Business .90%32.2 .81%30.2 Bus R/E 2.14%29.92.10%31.4Construction .97%$ 107.2.94%$ 105.5Commercial total .52%11.1 .56%11.9 Consumer 5.15%29.25.13%28.9Consumer CC .30%9.1.40%12.3Personal R/E .54%1.8.56%1.8Revolving H/E 3.70%.2 .30%.1 Overdrafts .84%$ 51.3 .90%$ 55.0 Consumer total .92%$ 158.6.93%$ 160.5Allowance for credit losses on loans 1.07% 0.88% 0.90% 0.92% 0.96% 0.94% 0.95% 0.94% 0.93% 0.92% 0.60% 0.80% 1.00% 1.20% 1.40% $100 $125 $150 $175 $200 $225 $139.6 0.95% 1/1 $200.5 1.22% 1Q $172.4 1.10% 2Q $162.8 3Q $150.0 0.99% 4Q $134.7 0.87% 4Q $159.3 1Q $158.7 2Q 2Q $162.2 $143.4 1Q $162.4 3Q 4Q $160.5 $138.0 1Q $158.6 $150.1 2Q3Q 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 35 Portfolio Companies Representing $966.5 million in Revenue Over 3,100 Employees Fair Value as of June 30, 2024: $178.3 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 24

 
NON-GAAP RECONCILIATIONS 25 For The Three Months Ended June 30, 2023Mar. 31, 2024June 30, 2024(DOLLARS IN THOUSANDS) 249,538$248,999$262,249$Net Interest IncomeA 147,605$148,848$152,244$Non-Interest IncomeB 227,611$245,697$232,214$Non-Interest ExpenseC 169,532$152,150$182,279$Pre-Provision Net Revenue (A+B-C) Pre-tax, Pre-provision Net Revenue