Commerce Bancorp Earnings Per Share up 39% Deposits Grow 43%.Business Editors CHERRY HILL Cherry Hill, township (1990 pop. 69,319), Camden co., W central N.J.; name was changed from Delaware township to Cherry Hill in 1961. Largely residential, Cherry Hill has been marked by great development and housing growth, especially since the 1970s. , N.J.--(BUSINESS WIRE)--Jan. 13, 2003 Commerce Bancorp This article is about the bank headquartered in Cherry Hill, New Jersey. For other uses, see Commerce Bank. Commerce Bancorp (NYSE: CBH), doing business as Commerce Bank , Inc. (NYSE NYSE See: New York Stock Exchange :CBH CBH cutaneous basophil hypersensitivity. ) reported record earnings and increased deposits, assets and loans for the fourth quarter of 2002, it was announced today by Vernon Vernon, city, Canada Vernon, city (1991 pop. 23,514), S British Columbia, Canada, near the north end of Okanagan Lake. The center of a fruit-growing and dairying area, it has packing and dehydrating plants. W. Hill, II, Chairman of the multi-bank holding company. Chairman Hill indicated "America's Most Convenient Bank" continues to produce record results, fueled by a deposit increase of 43% and earnings per share growth of 39%."
December 31, 2002
FOURTH QUARTER FINANCIAL HIGHLIGHTS
%
Increase
--------
-- Total Assets: $ 16.4 Billion 44 %
-- Total Deposits: $ 14.5 Billion 43 %
-- Total (Net) Loans: $ 5.7 Billion 27 %
-- Total Revenues: $ 229.7 Million 34 %
-- Net Income: $ 40.6 Million 44 %
-- Net Income Per Share: $ .57 39 %
------- --------
Income Statement Comparison
Three Months Ended Year Ended
December 31, December 31,
------------------------------------------------------
% %
2002 2001 Increase 2002 2001 Increase
------------------------------------------------------
(dollars in thousands, except per share data)
Total Revenues: $229,711 $171,012 34% $830,221 $598,131 39%
Total Expenses: 160,879 122,149 32 579,168 420,036 38
Net Income: 40,574 28,230 44 144,815 103,022 41
Net Income
Per Share: $.57 $.41 39% $2.04 $1.51 35%
-------- --------- ----- -------- -------- -----
Balance Sheet Comparison
Linked Quarter
--------------
12/31/02 12/31/01 % 9/30/02 $ %
Change Increase Increase
---------------------------------------------------
(dollars in millions)
Total Assets: $16,404 $11,364 44% $15,374 $1,030 7%
Total Loans (Net): 5,732 4,516 27 5,457 275 5
Core Deposits: 13,834 9,497 46 12,896 938 7
Total Deposits: 14,549 10,186 43 13,880 669 5
Chairman's Statement Vernon W. Hill, II, Chairman, commenting on the Company's financial results said, "the unique Commerce relationship-building, revenue growth model continues to produce exceptional results." Some of our financial highlights were:
-- At $.57 per share, the Company exceeded the First Call
consensus EPS estimate of $.55. This marked the eighth
consecutive quarter that the Company's earnings per share
exceeded the First Call consensus.
-- Net income increased 41% for 2002 and 44% for the fourth
quarter of 2002.
-- Earnings per share rose 39% for the fourth quarter and 35% for
2002.
-- Total revenues grew 39% for 2002.
-- Core deposits grew 46% for the year including $938 million in
growth during the fourth quarter. For the year, core deposits
grew $4.338 billion.
-- Comparable store deposits grew 29%.
-- The Company opened 40 new offices in 2002 and has 140+ new
offices in development.
-- Our entry into Manhattan, 15 months ago, continues to meet
with exceptional success:
-- Total deposits increased to $627 million, a quarterly
increase of $205 million, with eleven branch locations.
-- Total accounts now exceed 57,000.
-- Our entry into Long Island has been met with tremendous
customer acceptance:
-- Total deposits increased to $235 million, a quarterly
increase of $111 million, with seven branch locations
including two opened in December 2002.
-- Total accounts now exceed 18,000.
-- Shareholder returns, foremost in our objectives, continue to
be excellent.
A comparison of our one, five and ten year shareholder returns to the S & P Index follows:
Commerce S & P Index
-------- -----------
1 year 11% -22%
5 years 22 -1
10 years 30 9
Future Guidance Due to our continued strong operating performance, we reiterate re·it·er·ate tr.v. re·it·er·at·ed, re·it·er·at·ing, re·it·er·ates To say or do again or repeatedly. See Synonyms at repeat. re·it our recently increased future guidance:
Previous Revised Last Actual %
Growth Growth 5-Year Fourth
Targets Targets Growth % Quarter
2002
--------- -------- -------- --------
Total Deposits: 20 - 25% 25% 32% 43%
--------
Comp Store Deposits: 15 18 20 29
--------
Total Revenue: 25 25 30 34
--------
Net Income: 20 - 25% 25 31 44
--------
Earnings Per Share: 15 - 20% 20 31 39
--------
Additionally, the Company plans to open approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. 45 branch offices in 2003, in the following areas:
Metropolitan Philadelphia 13
Metropolitan New York 32
Total Deposits The Company's dramatic deposit growth continues with total deposits at December December: see month. 31, 2002 of $14.5 billion, a $4.4 billion increase or 43% over total deposits of $10.2 billion a year ago. All of the growth was in core deposits.
12/31/02 12/31/01 $ Increase % Increase
-------- -------- ---------- ---------
(dollars in millions)
Core Deposits $13,834 $9,497 $4,338 46%
Total Deposits 14,549 10,186 4,363 43%
Core Deposit Growth
Comp
Annual Store
Growth Growth
12/31/02 % Total 12/31/01 % Total % %
-------- ------- -------- ------- ------ ------
(dollars in millions)
Consumer $7,181 52% $5,012 53% 43% 27%
Commercial 4,908 35 3,171 33 55 36
Government 1,745 13 1,314 14 33 21
-------- ------- -------- ------- ------ ------
Total $13,834 100% $9,497 100% 46% 29%
-------- -------- ------ ------
The Company's total deposit costs including non-interest-bearing demand deposits were 1.09% and the total cost of funds Cost of Funds The interest rate paid on an outstanding loan. Notes: Money isn't free! Cost of funds is the cost of borrowing money. See also: Interest Rate Cost of funds Interest rate associated with borrowing money. was 1.19% for the fourth quarter. Core deposit costs were 1.04% for the fourth quarter of 2002. For the first time, the Company is disclosing its deposit growth by markets served.
Deposit Growth by Market
# of $
Offices 12/31/02 12/31/01 Increase
------- --------- --------- --------
(dollars in millions)
Metro Philadelphia 123 $ 8,630 $ 6,444 $2,186
Northern New Jersey 83 5,057 3,655 1,402
Manhattan 11 627 87 540
Long Island 7 235 n/a 235
------- --------- --------- --------
Total 224 $ 14,549 $ 10,186 $4,363
% Comp Annualized
Increase Store Growth/Branch
-------- ----- -------------
(dollars in millions)
Metro Philadelphia 34% 29% $ 20
Northern New Jersey 38 29 20
Manhattan 621 n/a 100
Long Island n/a n/a 113
-------- ----- -----
Total 43% 29% 27%
Net Income and Earnings Per Share Net income totaled $40.6 million for the fourth quarter of 2002, up $12.3 million or 44% over net income of $28.2 million for the fourth quarter of 2001. On a diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. per share basis, net income for the fourth quarter was $.57 compared to $.41 for the fourth quarter of 2001, a 39% increase.
Three Months Ended Year Ended
------------------ ----------
% %
12/31/02 12/31/01 Increase 12/31/02 12/31/01 Increase
-------- -------- -------- -------- -------- --------
(dollars in thousands, except per share data)
Net Income $40,574 $28,230 44% $144,815 $103,022 41%
-------- -------
Earnings
Per Share $ .57 $ .41 39% $ 2.04 $ 1.51 35%
-------- -------
For the year of 2002, net income totaled $144.8 million, up $41.8 million or 41% over net income of $103.0 million for the year of 2001. On a diluted per share basis, net income for the year of 2002 was $2.04 compared to $1.51 for the year of 2001, a 35% increase. The 44% growth in net income for the fourth quarter of 2002 was driven by increased net interest income of 36% and increased fee income of 31%. On a year-to-year basis, total revenues grew 39% compared to a 38% increase in expenses. Total Revenues
Three Months Ended Year Ended
------------------ ----------
% %
12/31/02 12/31/01 Increase 12/31/02 12/31/01 Increase
-------- -------- -------- ------- -------- --------
(dollars in thousands, except per share data)
Total
Revenues $229,711 $171,012 34% $830,221 $598,131 39%
-------- ------
Revenue
Per Share $12.85 $9.90 30% $11.71 $8.78 33%
-------- ------
Emphasizing its role as a growth retailer, total revenues (net interest income plus non-interest income) were $229.7 million for the fourth quarter of 2002 compared to $171.0 million for the fourth quarter of 2001, up $58.7 million, or 34%. Total revenues for the year 2002 totaled $830.2 million compared to $598.1 million for the year 2001, up $232.1 million, or 39%. Total revenue growth resulted from significant growth in net interest income and non-interest income as more fully discussed below. Net Interest Income and Net Interest Margin Net interest income for the fourth quarter totaled $159.5 million, a 6% increase from the prior quarter and a 36% increase over the $117.5 million recorded a year ago. Net interest income for the year 2002 totaled $572.8 million, a 43% increase over the $401.3 million for 2001. These increases in net interest income were due to the volume increases in interest earning assets Earning Assets Any income-earning asset owned by a company. Notes: These assets are generally interest-bearing accounts, bonds, and securities available for sale. See also: Asset, Asset Valuation, Earnings, Net Interest Margin resulting from the Company's strong, low-cost core deposit growth. The net interest margin for the fourth quarter of 2002 was 4.55% down 10 basis points from the 4.65% margin from the third quarter. The decline in the margin was attributed primarily to lower reinvestment rates Reinvestment Rate The rate at which cash flows from fixed-income securities may be reinvested. Notes: Because of the additional interest income, bondholders can make larger investment returns if they reinvest received coupon payments. . While the net interest margin rate has contracted as a result, the Company's volume increase in its net interest income has more than offset the effect of the net interest margin rate decline. The net interest margin for 2002 was 4.69% compared to 4.76% for 2001. Non-Interest Income Non-interest income for the fourth quarter of 2002 increased to $70.2 million from $53.5 million a year ago, a 31% increase. On a linked quarter basis, non-interest income increased 1%. Non-interest income for the year 2002 increased to $257.5 million from $196.8 million for the year of 2001, a 31% increase. The growth in non-interest income for the fourth quarter and 2002 was reflected in increased deposit charges and service fees and other operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. which are more fully depicted de·pict tr.v. de·pict·ed, de·pict·ing, de·picts 1. To represent in a picture or sculpture. 2. To represent in words; describe. See Synonyms at represent. below:
Three Months Ended Year Ended
------------------ ----------
% %
12/31/02 12/31/01 Increase 12/31/02 12/31/01 Increase
-------- -------- -------- -------- -------- -------
(Dollars in thousands) (Dollars in thousands)
--------------------------------------------------------
Deposit
Charges
& Service
Fees $36,599 $28,011 31% $130,993 $100,912 30%
Other
Operating
Income:
Insurance 13,798 12,276 12 55,875 49,803 12
Capital
Markets 8,476 5,468 55 35,082 22,049 59
Loan
Brokerage
Fees 6,183 4,643 33 18,655 10,976 70
Other 5,159 3,144 64 16,861 13,065 29
--------------------------------------------------------
Total
Other $33,616 $25,531 32% $126,473 $ 95,893 32%
--------------------------------------------------------
Total Non-
Interest
Income $70,215 $53,542 31% $257,466 $196,805 31%
Commerce National Insurance Services Total revenues for the Company's insurance division were $13.8 million for the fourth quarter of 2002 compared to $12.3 million for the fourth quarter of 2001, a 12% increase. Total revenues for the year 2002 were $55.9 million versus $49.8 million for 2001, a 12% increase. Commerce Capital Markets Total revenues for the Company's capital markets division were $8.5 million for the fourth quarter of 2002 compared to $5.5 million for the fourth quarter of 2001, a 55% increase. Total revenues for the year 2002 were $35.1 million versus $22.0 million for 2001, a 59% increase. Non- non- word element [L.]not . non- pref. Not: noninvasive. Interest Expenses Non-interest expenses for the fourth quarter of 2002 were $160.9 million, up 32% from $122.1 million a year ago. Non-interest expenses for the year 2002 were $579.2 million, up 38% from $420.0 million for the year 2001. The increase in non-interest expenses for the fourth quarter and the year 2002 were widespread throughout all non-interest expense categories and were consistent with the same reporting periods a year ago. They reflect the Company's rapid growth during the respective periods and also reflect substantial infrastructure investments made by the Company to support future growth. Linked Quarter Comparison A comparison of financial results for the quarter ended December 31, 2002 to the previous quarter ended September September: see month. 30, 2002 is as follows: (dollars in thousands, except per share data)
Three Months Ended Linked
------------------ Quarter
12/31/02 9/30/02 $ Increase % Increase
-------- ------ ---------- ----------
Total Assets $16,403,981 $15,374,269 $1,029,712 7
Total Loans (Net) 5,731,856 5,457,147 274,709 5
Core Deposits 13,834,293 12,896,204 938,089 7
Total Deposits 14,548,841 13,879,636 669,205 5
Total Revenues 229,711 220,186 9,525 4
Net Interest Income 159,496 150,554 8,942 6
Non-Interest Income 70,215 69,632 583 1
Non-Interest Expense 160,879 154,828 6,051 4
Net Income 40,574 37,689 2,885 8
Net Income Per Share .57 .53 .04 8
Lending Loans increased 27% to $5.7 billion, and the growth was widespread throughout all loan categories. The Company's primary strength is in building customer relationships and growing market share in deposits, loans, and related services. Consumer and small business loan growth is directly related to the Company's significant increase in branch locations, market expansion and added lending personnel. Detailed in the chart below is a recap re·cap 1 tr.v. re·capped, re·cap·ping, re·caps 1. To replace a cap or caplike covering on: recapped the bottle. 2. of commercial and commercial real estate loan growth for the past year by loan size: (dollars in millions, except # of loans and average loan size)
Commercial Loan and Commercial Real Estate Growth
Average %
Size # of Loans Loan Size 12/31/02 12/31/01 Increase
---- ---------- ---------- -------- -------- --------
less than
$5 Million 14,504 $ 222,000 $3,219 $2,467 30%
greater than
$5 Million 72 8,889,000 640 567 13%
---------- ---------- -------- -------- --------
Total: 14,576 $ 265,000 $3,859 $3,034 27%
Geographically ge·o·graph·ic also ge·o·graph·i·cal adj. 1. Of or relating to geography. 2. Concerning the topography of a specific region. ge , loan growth has occurred in the following markets:
Portfolio Geographical Growth
12/31/02 12/31/01 Growth Rate % of Growth
-------- -------- ----------- -----------
(dollars in millions)
Metro Philadelphia $4,039 $3,236 25% 65%
Northern New Jersey 1,668 1,344 24 26
New York/Long Island 116 3 -- 9
-------- -------- -----------
Total: $5,823 $4,583 100%
As the Company serves its existing markets and expands into new markets, it has increased the number of lending officers from 172 at December 31, 2001 to 208 at December 31, 2002, or 21%. During that time, commercial and commercial real estate loans have increased to $3.9 billion from $3.0 billion. The Company continues to serve Main Street America America [for Amerigo Vespucci], the lands of the Western Hemisphere—North America, Central (or Middle) America, and South America. The world map published in 1507 by Martin Waldseemüller is the first known cartographic use of the name. and has avoided the pitfalls experienced by participation in Shared National Credit lending, loans to the telecommunications Communicating information, including data, text, pictures, voice and video over long distance. See communications. and energy sectors, sub-prime loans and foreign lending.
Loan Composition
----------------
% of % of $ %
12/31/02 Total 12/31/01 Total Increase Increase
-------- ------ --------- ------ -------- --------
(dollars in thousands)
Commercial $1,526,826 26% $1,157,791 25% $369,035 32%
Consumer 1,963,101 34 1,549,497 34 413,604 27
Commercial
Real Estate 987,356 17 813,311 18 174,045 21
Owner-Occupied 1,345,306 23 1,062,813 23 282,493 27
---------- ------ ---------- ------
Gross
Loans $5,822,589 100% $4,583,412 100%
Less:
Reserves ( 90,733) ( 66,981)
---------- ----------
Net Loans $5,731,856 $4,516,431 + 27
--------
Asset Quality Asset quality remains extremely sound due to the Company's conservative underwriting Underwriting 1. The process by which investment bankers raise investment capital from investors on behalf of corporations and governments that are issuing securities (both equity and debt). 2. The process of issuing insurance policies. standards, strong customer relationships and aggressive collection efforts. The Company's asset quality results are highlighted below:
Year Ended
----------
12/31/02 12/31/01 12/31/00
-------- -------- --------
Non-Performing Assets/Assets .11% .17% .21%
Net Loan Charge-Offs .18% .19% .11%
Loan Loss Reserve/ Gross Loans 1.56% 1.46% 1.32%
Non-Performing Loan Coverage 640% 398% 357%
Non-Performing Assets/Capital 2% 3% 3%
and Reserves
During the fourth quarter, the Company increased its reserve for loan losses as a percentage of loans to 1.56% from 1.54% on a linked quarter basis and from 1.46% a year ago. Non-performing assets and loans past due 90 days at December 31, 2002 totaled $18.4 million or .11% of total assets, versus $18.9 million, or .17% of total assets a year ago. Non-performing assets and loans past due 90 days or more represented 2% of stockholders' equity Stockholders' Equity The portion of the balance sheet that includes capital received from investors in exchange for stock (paid-in capital), donated capital, and retained earnings. This is equal to total assets minus liabilities, preferred stock and intangible assets. and the reserve for loan losses at December 31, 2002. During the fourth quarter of 2002, the Company's credit ratings were raised by Standard & Poor's to BBB BBB A medium grade assigned to a debt obligation by a rating agency to indicate an adequate ability to pay interest and repay principal. However, adverse developments are more likely to impair this ability than would be the case for bonds rated A and above. + from BBB and the Company's lead bank subsidiary rating was raised to A-. Investments Total investments increased to $8.9 billion from $5.6 billion a year ago. The portfolio is comprised primarily of high quality U.S. Government agency and mortgage-backed Mortgage-backed may refer to:
The appreciation in the available for sale and held to maturity portfolios totaled $207 million at December 31, 2002. Capital Resources Stockholders' equity at December 31, 2002 increased to $918.0 million, a $281.4 million increase, or 44% over stockholders' equity of $636.6 million at December 31, 2001. Return on average stockholders' equity (ROE A fictitious surname used for an unknown or anonymous person or for a hypothetical person in an illustration. A lawsuit is generally named for the persons who are parties to it. ) for the fourth quarter of 2002 was 18.32% compared to 17.18% for the fourth quarter of 2001. The Company's capital ratios at December 31, 2002 were as follows:
Regulatory Guidelines
Commerce "Well Capitalized"
-------- ---------------------
Leverage Ratio 6.37% 5.00
Tier I 11.63 6.00
Total Capital 12.69 10.00
Retail Activities "America's Most Convenient Bank" continued its unique retail focus by offering the best in community branch banking and on-line banking. The Company's continued deposit growth consists of growth in "same-store" (existing branch) sales and increased deposits from newly opened branches. -- "Same Store Sales Same Store Sales A statistic used in retail industry analysis. It compares sales of stores that have been open for a year or more. Notes: This statistic allows investors to determine what portion of new sales has come from sales growth and what portion from the opening of " "Same-store core deposit growth" at December 31, 2002 was 29% compared to the same period a year ago. -- New Branch Offices During the fourth quarter of 2002, the Company opened 21 new branch offices, increasing the total offices opened to 224, and it opened a total of 40 new branches in 2002. During the last three years, the Years, The the seven decades of Eleanor Pargiter’s life. [Br. Lit.: Benét, 1109] See : Time Company has opened 104 of its 224 branches. Branches opened during the fourth quarter were as follows: Metropolitan Philadelphia ------------------------- Location County -------- ------ Society Hill Philadelphia (PA) New Brunswick Middlesex (NJ) Morris Township Morris (NJ) Spring Lake Heights Monmouth (NJ) Thorndale Chester (PA) West Caldwell Essex (NJ) Union Township Union (NJ) East Windsor Mercer (NJ) Fort Lee Bergen (NJ) Red Lion Road Philadelphia (PA) Budd Lake Morris (NJ) Hillsborough Somerset (NJ) Frankford Avenue Philadelphia (PA) Metropolitan New York --------------------- 77th & 2nd Manhattan Boro/NYC (NY) 32nd & Park Manhattan Boro/NYC (NY) 74th & Broadway Manhattan Boro/NYC (NY) East Northport Suffolk (NY) 68th & Broadway Manhattan Boro/NYC (NY) Long Beach Nassau (NY) Massapequa East Nassau (NY) Pearl River Rockland (NY) -- Commerce Online Commerce continued its leading role in on-line banking by increasing its penetration The successful unauthorized breach of a security perimeter. See penetration test. rate to 35.2%, which is one of the highest in America. Corporate Governance Corporate Governance The relationship between all the stakeholders in a company. This includes the shareholders, directors, and management of a company, as defined by the corporate charter, bylaws, formal policy, and rule of law. The Corporate Governance Committee, composed of outside directors, recommended and the outside members of the Board of Directors unanimously approved: -- The Company will continue its company-wide stock option plan, but will extend the vesting period of future options. Options will not be considered for expensing until accounting standards are clarified. Quarterly, the Company will report the cost as if expensed. -- For 29 years, the Company has utilized the design and facilities services of InterArch, owned by Shirley Hill, wife of Vernon W. Hill, CEO. The Board believes that this arrangement, which has been conducted within all regulatory rules and annually reviewed and fully disclosed, has been an important factor in the success of the Commerce Brand. The Board has approved the transfer, without cost, into the Company of the facility functions, with InterArch continuing to provide architecture and design services on a fee basis, subject to the Board and Audit and Oversight Committee review and approval. Forward-Looking Statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. The Company may from time to time make written or oral "forward-looking statements", including statements contained in the Company's filings with the Securities and Exchange Commission, in its reports to stockholders and in other communications by the Company, which are made in good faith by the Company pursuant to the "safe harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. " provisions of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995. These forward-looking statements include statements with respect to the Company's beliefs, plans, objectives, goals, expectations, anticipations Anticipations is the magazine of the Young Fabians, the under-31 section of the Fabian Society. The magazine was founded in 1996, however the group only produced one edition. , estimates and intentions, that are subject to significant risks and uncertainties and are subject to change based on various factors (some of which are beyond the Company's control). The words "may", "could", "should", "would", "believe", "anticipate", "estimate", "expect", "intend", "plan", and similar expressions are intended to identify forward-looking statements. The following factors, among others, could cause the Company's financial performance to differ materially from that expressed in such forward-looking statements: the strength of the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. economy in general and the strength of the local economies in which the company conducts operations; the effects of, and changes in, trade, monetary and fiscal policies, including interest rate policies of the Board of Governors of the Federal Reserve System Board of Governors of the Federal Reserve System The managing body of the Federal Reserve System, which sets policies on bank practices and the money supply. (the "FRB See Federal Reserve Board. "); inflation; interest rates, market and monetary fluctuations; the timely development of competitive new products and services by the Company and the acceptance of such products and services by customers; the willingness of customers to substitute competitors' products and services for the Company's products and services and vice versa VICE VERSA. On the contrary; on opposite sides. ; the impact of changes in financial services' laws and regulations (including laws concerning taxes, banking, securities and insurance); technological changes; future acquisitions; the expense savings and revenue enhancements revenue enhancement An increase in revenues, especially by way of increased taxes. Revenue enhancement includes reducing taxpayer deductions and eliminating tax credits. from acquisitions being less than expected; the growth and profitability of the Company's non-interest or fee income being less than expected; unanticipated regulatory reg·u·late tr.v. reg·u·lat·ed, reg·u·lat·ing, reg·u·lates 1. To control or direct according to rule, principle, or law. 2. or judicial proceedings judicial proceedings n. any action by a judge re: trials, hearings, petitions, or other matters formally before the court. (See: judicial) ; changes in consumer spending Consumer demand or consumption is also known as personal consumption expenditure. It is the largest part of aggregate demand or effective demand at the macroeconomic level. and saving habits; and the success of the Company at managing the risks involved in the foregoing. The Company cautions that the foregoing list of important factors is not exclusive. The Company does not undertake to update any forward-looking statement, whether written or oral, that may be made from time to time by or on behalf of the Company.
Commerce Bancorp, Inc.
Selected Consolidated Financial Data
(Unaudited)
Three Months Ended
December 31
--------------------------------
%
2002 2001 Change
------------ ------------ ------
(dollars and shares in thousands)
Income Statement Data:
Net interest income $159,496 $117,470 36 %
Provision for loan losses 8,000 7,458 7
Noninterest income 70,215 53,542 31
Total revenues 229,711 171,012 + 34
------- ----
Noninterest expense 160,879 122,149 32
Net income 40,574 28,230 + 44
------- ----
Per Share Data:
Net income - Basic $0.60 $0.43 40 %
Net income - Diluted 0.57 0.41 + 39
------- ----
Book value - Basic
Book value - Diluted
Revenue per share - Diluted $12.85 $9.90 + 30 %
------- ----
Weighted Average Shares Outstanding:
Basic 67,548 65,418
Diluted 71,505 69,094
Balance Sheet Data:
Total assets
Loans (net)
Allowance for loan losses
Securities available for sale
Securities held to maturity
Total deposits
Core deposits
Long-term debt
Trust Capital Securities - Commerce
Capital Trust I
Convertible Trust Capital Securities - Commerce
Capital Trust II
Stockholders' equity
Capital:
Stockholders' equity to total assets
Risk-based capital ratios:
Tier I
Total capital
Leverage ratio
Performance Ratios:
Cost of funds 1.19 % 1.76 %
Net interest margin 4.55 4.85
Return on average assets 1.03 1.04
Return on average total
stockholders' equity 18.32 17.18
Twelve Months Ended
December 31
--------------------------------
%
2002 2001 Change
------------ ------------ ------
(dollars and shares in thousands)
Income Statement Data:
Net interest income $572,755 $401,326 43 %
Provision for loan losses 33,150 26,384 26
Noninterest income 257,466 196,805 31
Total revenues 830,221 598,131 + 39
------- ----
Noninterest expense 579,168 420,036 38
Net income 144,815 103,022 + 41
------- ----
Per Share Data:
Net income - Basic $2.16 $1.59 36 %
Net income - Diluted 2.04 1.51 + 35
------- ----
Book value - Basic $13.53 $9.70 39 %
Book value - Diluted 12.76 9.22 + 38
------- ----
Revenue per share - Diluted $11.71 $8.78 + 33 %
------- ----
Weighted Average Shares Outstanding:
Basic 66,795 64,666
Diluted 70,903 68,102
Balance Sheet Data:
Total assets $16,403,981 $11,363,703 + 44 %
Loans (net) 5,731,856 4,516,431 27
Allowance for loan losses 90,733 66,981 35
Securities available for sale 7,806,779 4,152,704 88
Securities held to maturity 763,026 1,132,172 (33)
Total deposits 14,548,841 10,185,594 43
---------- ----------
Core deposits 13,834,293 9,496,602 46
---------- ----------
Long-term debt 0 23,000 (100)
Trust Capital Securities - Commerce
Capital Trust I 0 57,500 (100)
Convertible Trust Capital Securities -
Commerce Capital Trust II 200,000 0 -
Stockholders' equity 918,010 636,570 + 44
----
Capital:
Stockholders' equity to total assets 5.60 % 5.60 %
-------
Risk-based capital ratios:
Tier I 11.63 10.81
Total capital 12.69 11.96
Leverage ratio 6.37 6.24
Performance Ratios:
Cost of funds 1.46 % 2.34 %
Net interest margin 4.69 4.76
Return on average assets 1.05 1.08
Return on average total
stockholders' equity 18.50 17.64
The following summary presents information regarding non-performing
loans and assets as of December 31, 2002 and the preceding four
quarters (dollar amounts in thousands).
Dec. Sept. June March Dec.
31, 30, 30, 31, 31,
2002 2002 2002 2002 2001
------- -------- ------- ------- --------
Non-accrual loans:
Commercial $5,412 $7,213 $7,581 $9,473 $6,835
Consumer 2,734 2,147 1,557 1,537 1,484
Real estate:
Construction 131 131 181 181 1,590
Mortgage 5,891 5,754 5,778 5,695 6,924
------- -------- ------- ------- --------
Total non-accrual loans 14,168 15,245 15,097 16,886 16,833
------- -------- ------- ------- --------
Restructured loans:
Commercial 5 6 6 7 8
Consumer
Real estate:
Construction
Mortgage
------- -------- ------- ------- --------
Total restructured loans 5 6 6 7 8
------- -------- ------- ------- --------
Total non-performing loans 14,173 15,251 15,103 16,893 16,841
------- -------- ------- ------- --------
Other real estate 3,589 2,367 2,471 2,602 1,549
------- -------- ------- ------- --------
Total non-performing assets 17,762 17,618 17,574 19,495 18,390
------- -------- ------- ------- --------
Loans past due 90 days or
more and still accruing 620 900 834 484 519
------- -------- ------- ------- --------
Total non-performing assets
and loans past due 90 days
or more $18,382 $18,518 $18,408 $19,979 $18,909
======= ======= ======= ======= ========
Total non-performing loans as
a percentage of total period-
end loans 0.24% 0.28% 0.29% 0.34% 0.37%
Total non-performing assets
as a percentage of total
period-end assets 0.11% 0.11% 0.13% 0.16% 0.16%
Total non-performing assets
and loans past due 90 days
or more as a percentage of
total period-end assets 0.11% 0.12% 0.13% 0.16% 0.17%
-----
Allowance for loan losses as
a percentage of total non-
performing loans 640% 560% 530% 428% 398%
Allowance for loan losses as
a percentage of total
period-end loans 1.56% 1.54% 1.52% 1.47% 1.46%
Total non-performing assets
and loans past due 90 days
or more as a percentage of
stockholders' equity and
allowance for loan losses 2% 2% 2% 3% 3%
The following table presents, for the periods indicated, an analysis
of the allowance for loan losses and other related data: (dollar
amounts in thousands)
Three Months Ended Twelve Months Ended
------------------- -------------------
12/31/02 12/30/01 12/31/02 12/30/01
--------- --------- --------- ---------
Balance at beginning of
period $85,479 $61,386 $66,981 $48,680
Provisions charged to
operating expenses 8,000 7,458 33,150 26,384
--------- --------- --------- ---------
93,479 68,844 100,131 75,064
Recoveries on loans charged-
off:
Commercial 358 373 815 552
Consumer 58 67 339 288
Commercial real estate 153 18 176 134
--------- --------- --------- ---------
Total recoveries 569 458 1,330 974
Loans charged-off:
Commercial (2,194) (1,512) (7,181) (5,862)
Consumer (1,121) (809) (3,514) (2,784)
Commercial real estate - - (33) (411)
--------- --------- --------- ---------
Total charge-offs (3,315) (2,321) (10,728) (9,057)
--------- --------- --------- ---------
Net charge-offs (2,746) (1,863) (9,398) (8,083)
--------- --------- --------- ---------
Balance at end of period $90,733 $66,981 $90,733 $66,981
========= ========= ========= =========
Net charge-offs as a
percentage of average
loans outstanding 0.19 % 0.17 % 0.18 % 0.19 %
Net Reserve Additions $5,254 $5,595 $23,752 $18,301
-------- --------- --------- ---------
Commerce Bancorp, Inc. and Subsidiaries Average Balances
and Net Interest Income
(unaudited)
------------------------------
December 2002
-----------------------------
Average Average
Balance Interest Rate
-----------------------------
(dollars in thousands)
Earning Assets
----------------------------------------
Investment securities
Taxable $8,033,417 $104,326 5.15 %
Tax-exempt 113,895 1,820 6.34
Trading 272,107 4,068 5.93
------------- --------- -----
Total investment securities 8,419,419 110,214 5.19
Federal funds sold 51,988 181 1.38
Loans
Commercial mortgages 2,241,044 37,009 6.55
Commercial 1,338,892 19,816 5.87
Consumer 1,963,307 33,928 6.86
Tax-exempt 195,972 4,517 9.14
------------- --------- -----
Total loans 5,739,215 95,270 6.59
------------- --------- -----
Total earning assets $14,210,622 $205,665 5.74 %
=============
Sources of Funds
----------------------------------------
Interest-bearing liabilities
Regular savings $2,809,817 $7,110 1.00 %
N.O.W. accounts 393,844 919 0.93
Money market plus 5,048,365 12,375 0.97
Time deposits 2,054,038 14,376 2.78
Public funds 842,374 3,998 1.88
------------- --------- -----
Total deposits 11,148,438 38,778 1.38
Other borrowed money 201,547 729 1.44
Long-term debt 200,000 3,022 5.99
------------- --------- -----
Total deposits and interest-bearing
liabilities 11,549,985 42,529 1.46
Noninterest-bearing funds (net) 2,660,637
------------- --------- -----
Total sources to fund earning assets $14,210,622 42,529 1.19
============= --------- -----
Net interest income and
margin tax-equivalent basis $163,136 4.55 %
========== =====
Other Balances
----------------------------------------
Cash and due from banks $788,271
Other assets 831,250
Total assets 15,741,365
Total deposits 14,170,281
----------
Demand deposits (noninterest-bearing) 3,021,843
Other liabilities 283,708
Stockholders' equity 885,829
Allowance for loan losses 88,778
------------------------------
September 2002
-----------------------------
Average Average
Balance Interest Rate
-----------------------------
(dollars in thousands)
Earning Assets
----------------------------------------
Investment securities
Taxable $7,281,082 $102,306 5.57 %
Tax-exempt 88,711 1,325 5.92
Trading 168,668 2,095 4.93
------------- --------- -----
Total investment securities 7,538,461 105,726 5.56
Federal funds sold 95,341 403 1.68
Loans
Commercial mortgages 2,131,809 36,868 6.86
Commercial 1,253,565 19,230 6.09
Consumer 1,865,040 33,252 7.07
Tax-exempt 178,956 3,835 8.50
------------- --------- -----
Total loans 5,429,370 93,185 6.81
------------- --------- -----
Total earning assets $13,063,172 $199,314 6.05 %
=============
Sources of Funds
----------------------------------------
Interest-bearing liabilities
Regular savings $2,498,700 $7,912 1.26 %
N.O.W. accounts 352,234 1,031 1.16
Money market plus 4,389,903 13,472 1.22
Time deposits 1,958,165 15,021 3.04
Public funds 1,001,570 5,353 2.12
------------- --------- -----
Total deposits 10,200,572 42,789 1.66
Other borrowed money 99,819 403 1.60
Long-term debt 200,000 3,029 6.01
------------- --------- -----
Total deposits and interest-bearing
liabilities 10,500,391 46,221 1.75
Noninterest-bearing funds (net) 2,562,781
------------- --------- -----
Total sources to fund earning assets $13,063,172 46,221 1.40
============= --------- -----
Net interest income and
margin tax-equivalent basis $153,093 4.65 %
========== =====
Other Balances
----------------------------------------
Cash and due from banks $671,394
Other assets 708,005
Total assets 14,359,739
Total deposits 12,970,854
----------
Demand deposits (noninterest-bearing) 2,770,282
Other liabilities 248,999
Stockholders' equity 840,067
Allowance for loan losses 82,832
-----------------------------
December 2001
-----------------------------
Average Average
Balance Interest Rate
-----------------------------
(dollars in thousands)
Earning Assets
----------------------------------------
Investment securities
Taxable $4,897,180 $75,980 6.16 %
Tax-exempt 85,937 1,288 5.94
Trading 212,892 2,707 5.05
------------- --------- -----
Total investment securities 5,196,009 79,975 6.11
Federal funds sold 177,235 932 2.09
Loans
Commercial mortgages 1,719,681 31,403 7.24
Commercial 1,024,931 17,047 6.60
Consumer 1,533,966 30,215 7.81
Tax-exempt 211,435 4,654 8.73
------------- --------- -----
Total loans 4,490,013 83,319 7.36
------------- --------- -----
Total earning assets $9,863,257 $164,226 6.61 %
=============
Sources of Funds
----------------------------------------
Interest-bearing liabilities
Regular savings $1,840,806 $6,942 1.50 %
N.O.W. accounts 284,453 1,071 1.49
Money market plus 3,235,319 12,130 1.49
Time deposits 1,473,557 15,996 4.31
Public funds 801,453 6,274 3.11
------------- --------- -----
Total deposits 7,635,588 42,413 2.20
Other borrowed money 120,910 289 0.95
Long-term debt 80,500 1,026 5.06
------------- --------- -----
Total deposits and interest-bearing
liabilities 7,836,998 43,728 2.21
Noninterest-bearing funds (net) 2,026,259
------------- --------- -----
Total sources to fund earning assets $9,863,257 43,728 1.76
============= --------- -----
Net interest income and
margin tax-equivalent basis $120,498 4.85 %
========== =====
Other Balances
----------------------------------------
Cash and due from banks $482,378
Other assets 583,257
Total assets 10,864,953
Total deposits 9,837,053
----------
Demand deposits (noninterest-bearing) 2,201,465
Other liabilities 169,174
Stockholders' equity 657,316
Allowance for loan losses 63,939
Notes
-- Weighted average yields on tax-exempt obligations have been
computed on a tax-equivalent basis assuming a federal tax rate
of 35%.
-- Non-accrual loans have been included in the average loan
balance.
-- Investment securities includes investments available for sale.
-- Consumer loans include mortgage loans held for sale.
Commerce Bancorp, Inc. and Subsidiaries
Consolidated Balance Sheets
(unaudited)
----------------------------------------------------------------------
(dollars in thousands) December 31, September 30, 2002
---------------------------------------------
2002 Actual $Change % Change
----------------------------------------------------------------------
Assets
Cash and due from banks $811,434 $740,604 $70,830 10 %
Federal funds sold 0 87,900 (87,900) (100)
---------------------------------------------
Cash and cash
equivalents 811,434 828,504 (17,070) (2)
Loans held for sale 96,920 66,612 30,308 45
Trading securities 326,479 197,386 129,093 65
Securities available for
sale 7,806,779 7,093,561 713,218 10
Securities held to
maturity 763,026 898,532 (135,506) (15)
Loans 5,822,589 5,542,626 279,963 5
Less allowance
for loan losses 90,733 85,479 5,254 6
---------------------------------------------
5,731,856 5,457,147 274,709 5
Reserve % 1.56% 1.54%
Bank premises and
equipment, net 499,189 449,677 49,512 11
Other
assets 368,298 382,850 (14,552) (4)
---------------------------------------------
$16,403,981 $15,374,269 $1,029,712 7 %
=============================================
Liabilities
Deposits:
Demand:
Interest-
bearing $5,635,351 $5,162,886 $472,465 9 %
Noninterest-
bearing 3,243,091 3,060,273 182,818 6
Savings 2,861,677 2,705,202 156,475 6
Time 2,808,722 2,951,275 (142,553) (5)
---------------------------------------------
Total deposits 14,548,841 13,879,636 669,205 5
Core deposits 13,834,293 12,896,204 938,089 7
Total other liabilities 937,130 623,567 313,563 50
---------------------------------------------
15,485,971 14,503,203 982,768 7
Stockholders' Equity 918,010 871,066 46,944 5
---------------------------------------------
$16,403,981 $15,374,269 $1,029,712 7 %
=============================================
------------------------------------------------------------
(dollars in thousands) December 31, 2001
-----------------------------------
Actual $Change % Change
------------------------------------------------------------
Assets
Cash and due from banks $557,738 $253,696 45 %
Federal funds sold 0 0 0
-----------------------------------
Cash and cash
equivalents 557,738 253,696 45
Loans held for sale 73,261 23,659 32
Trading securities 282,811 43,668 15
Securities available for
sale 4,152,704 3,654,075 88
Securities held to
maturity 1,132,172 (369,146) (33)
Loans 4,583,412 1,239,177 27
Less allowance
for loan losses 66,981 23,752 35
-----------------------------------
4,516,431 1,215,425 27
----
Reserve % 1.46%
Bank premises and
equipment, net 362,992 136,197 38
Other
assets 285,594 82,704 29
-----------------------------------
$11,363,703 $5,040,278 44 %
===================================
Liabilities
Deposits:
Demand:
Interest-
bearing $3,608,709 $2,026,642 56 %
Noninterest-
bearing 2,403,637 839,454 35
Savings 1,925,919 935,758 49
Time 2,247,329 561,393 25
-----------------------------------
Total deposits 10,185,594 4,363,247 43
Core deposits 9,496,602 4,337,691 46
----
Total other liabilities 541,539 395,591 73
-----------------------------------
10,727,133 4,758,838 44
Stockholders' Equity 636,570 281,440 44
-----------------------------------
$11,363,703 $5,040,278 44 %
===================================
Commerce Bancorp, Inc. and Subsidiaries
Consolidated Balance Sheets
(unaudited)
----------------------------------------------------------------------
Linked
Dec. 31, Sept. 30, Quarter Dec. 31,
------------------------------------------------------
(dollars in
thousands) 2002 2002 % Change 2001 % Change
----------------------------------------------------------------------
Assets
Cash and due
from banks $811,434 $740,604 10 % $557,738 45 %
Federal funds
sold 0 87,900 (100) 0 0
------------------------------------------------------
Cash and cash
equivalents 811,434 828,504 (2) 557,738 45
Loans held for
sale 96,920 66,612 45 73,261 32
Trading
securities 326,479 197,386 65 282,811 15
Securities
available for
sale 7,806,779 7,093,561 10 4,152,704 88
Securities held
to maturity 763,026 898,532 (15) 1,132,172 (33)
Loans:
Commercial real
estate:
Owner-
occupied 1,199,658 1,182,886 1 750,562 60
Investor
developer 723,067 731,784 (1) 664,605 9
Construction 409,937 409,929 0 460,957 (11)
------------------------------------------------------
2,332,662 2,324,599 0 1,876,124 24
Commercial
loans:
Term 842,869 745,069 13 600,374 40
Line of
credit 683,640 606,814 13 556,977 23
Demand 317 348 (9) 440 (28)
------------------------------------------------------
1,526,826 1,352,231 13 1,157,791 32
Consumer:
Mortgages (1-
4 family
residential) 626,652 568,931 10 471,680 33
Installment 140,493 147,126 (5) 161,647 (13)
Home equity 1,139,589 1,098,098 4 872,974 31
Credit lines 56,367 51,641 9 43,196 30
------------------------------------------------------
1,963,101 1,865,796 5 1,549,497 27
------------------------------------------------------
Total
loans 5,822,589 5,542,626 5 4,583,412 27
----------------------------- -----------------
Less allowance
for loan losses 90,733 85,479 6 66,981 35
------------------------------------------------------
5,731,856 5,457,147 5 4,516,431 27
Bank premises
and equipment,
net 499,189 449,677 11 362,992 38
Other assets 368,298 382,850 (4) 285,594 29
------------------------------------------------------
$16,403,981 $15,374,269 7 % $11,363,703 44 %
======================================================
Liabilities
Deposits:
Demand:
Interest-
bearing $5,635,351 $5,162,886 9 % $3,608,709 56 %
Noninterest-
bearing 3,243,091 3,060,273 6 2,403,637 35
Savings 2,861,677 2,705,202 6 1,925,919 49
Time 2,808,722 2,951,275 (5) 2,247,329 25
------------------------------------------------------
Total deposits 14,548,841 13,879,636 5 10,185,594 43
----- -----
Other borrowed
money 391,641 142,468 175 264,554 48
Other
liabilities 345,489 281,099 23 196,485 76
Trust Capital
Securities -
Commerce
Capital Trust I 0 0 0 57,500 (100)
Convertible
Trust Capital
Securities -
Commerce
Capital Trust II 200,000 200,000 0 0 0
Long-term debt 0 0 0 23,000 (100)
------------------------------------------------------
15,485,971 14,503,203 7 10,727,133 44
Stockholders'
Equity
Common stock 68,043 67,488 1 65,833 3
Capital in
excess of par
or stated value 538,795 512,081 5 461,897 17
Retained
earnings 199,604 169,125 18 94,698 111
Accumulated
other
comprehensive
income 113,614 123,993 (8) 15,764 621
------------------------------------------------------
920,056 872,687 5 638,192 44
Less treasury
stock, at cost 2,046 1,621 26 1,622 26
------------------------------------------------------
Total
stockholders'
equity 918,010 871,066 5 636,570 44
------------------------------------------------------
$16,403,981 $15,374,269 7 % $11,363,703 44 %
======================================================
Commerce Bancorp, Inc. and Subsidiaries
Consolidated Statements of Income
(unaudited)
----------------------------------------------------------------------
Three Months Ended
---------------------------------------------
Dec. 31 Sept. 30, Dec. 31
---------------------------------------------
(dollars in thousands,
except per share
amounts) 2002 2002 % Change 2001 % Change
----------------------------------------------------------------------
Interest income
Interest and fees on
loans $93,690 $91,843 2% $81,689 15 %
Interest on investments 108,153 104,528 3 78,577 38
Other interest 181 404 (55) 932 (81)
-------------------------- ------------------
Total interest
income 202,024 196,775 3 161,198 25
-------------------------- ------------------
Interest expense
Interest on deposits:
Demand 13,294 14,504 (8) 13,201 1
Savings 7,109 7,912 (10) 6,942 2
Time 18,374 20,374 (10) 22,270 (17)
-------------------------- ------------------
Total interest on
deposits 38,777 42,790 (9) 42,413 (9)
Interest on other
borrowed money 728 403 81 289 152
Interest on long-term
debt 3,023 3,028 (0) 1,026 195
-------------------------- ------------------
Total interest
expense 42,528 46,221 (8) 43,728 (3)
-------------------------- ------------------
Net interest income 159,496 150,554 6 117,470 36
Provision for loan losses 8,000 8,000 0 7,458 7
-------------------------- ------------------
Net interest income after
provision for loan
losses 151,496 142,554 6 110,012 38
Noninterest income
Deposit charges and
service fees 36,599 33,802 8 28,011 31
Other operating income 33,616 35,830 (6) 25,531 32
Net investment securities
gains 0 0 0 0 0
-------------------------- ------------------
Total noninterest
income 70,215 69,632 1 53,542 31
-------------------------- ------------------
Total Revenues 229,711 220,186 4 171,012 34
--- ---
Noninterest expense
Salaries and benefits 78,446 74,164 6 56,378 39
Occupancy 16,102 15,215 6 11,586 39
Furniture and equipment 18,995 17,012 12 14,220 34
Office 8,643 8,173 6 7,427 16
Audit and regulatory fees
and assessments 1,391 1,438 (3) 1,048 33
Marketing 4,910 7,850 (37) 5,460 (10)
Other 32,392 30,976 5 26,030 24
-------------------------- ------------------
Total noninterest
expenses 160,879 154,828 4 122,149 32
-------------------------- ------------------
Income before income
taxes 60,832 57,358 6 41,405 47
Provision for federal and
state income taxes 20,258 19,669 3 13,175 54
-------------------------- ------------------
Net income $40,574 $37,689 8% $28,230 44 %
========================== ==================
Net income per common and
common equivalent share:
Basic $0.60 $0.56 7% $0.43 40 %
-------------------------- ------------------
Diluted $0.57 $0.53 8 $0.41 39
-------------------------- ------------------
Average common and common
equivalent shares
outstanding:
Basic 67,548 67,065 1 65,418 3
-------------------------- ------------------
Diluted 71,505 71,084 1 69,094 3
-------------------------- ------------------
Cash dividends, common
stock $0.15 $0.15 0% $0.14 7 %
========================== ==================
Return on average assets 1.03 % 1.05 % 1.04 %
Return on average equity 18.32 17.95 17.18
Commerce Bancorp, Inc. and Subsidiaries
Consolidated Balance Sheets
(unaudited)
----------------------------------------------------------------------
December 31,
---------------------------
(dollars in thousands) 2002 2001
----------------------------------------------------------------------
Assets
Cash and due from banks $811,434 $557,738
Federal funds sold 0 0
---------------------------
Cash and cash equivalents 811,434 557,738
Loans held for sale 96,920 73,261
Trading securities 326,479 282,811
Securities available for sale 7,806,779 4,152,704
Securities held to maturity 763,026 1,132,172
(market value 12/02-$791,889;
12/01-$1,146,345)
Loans 5,822,589 4,583,412
Less allowance for loan losses 90,733 66,981
---------------------------
5,731,856 4,516,431
Bank premises and equipment, net 499,189 362,992
Other assets 368,298 285,594
---------------------------
$16,403,981 $11,363,703
===========================
Liabilities
Deposits:
Demand:
Interest-bearing $5,635,351 $3,608,709
Noninterest-bearing 3,243,091 2,403,637
Savings 2,861,677 1,925,919
Time 2,808,722 2,247,329
---------------------------
Total deposits 14,548,841 10,185,594
Other borrowed money 391,641 264,554
Other liabilities 345,489 196,485
Trust Capital Securities - Commerce Capital
Trust I 0 57,500
Convertible Trust Capital Securities -
Commerce Capital Trust II 200,000 0
Long-term debt 0 23,000
---------------------------
15,485,971 10,727,133
Stockholders' Equity
Common stock, 68,043,171 shares issued
(65,832,559 shares in 2001) 68,043 65,833
Capital in excess of par or stated value 538,795 461,897
Retained earnings 199,604 94,698
Accumulated other comprehensive income 113,614 15,764
---------------------------
920,056 638,192
Less treasury stock, at cost, 209,794
shares (200,118 shares in 2001) 2,046 1,622
---------------------------
Total stockholders' equity 918,010 636,570
---------------------------
$16,403,981 $11,363,703
===========================
Commerce Bancorp, Inc. and Subsidiaries
Consolidated Statements of Income
(unaudited)
----------------------------------------------------------------------
Three Months Ended Twelve Months Ended
December 31 December 31
------------------------ ---------------------------
(dollars in
thousands, except
per share
amounts) 2002 2001 % Change 2002 2001 % Change
------------------------------------------ ---------------------------
Interest income
Interest and fees
on loans $93,690 $81,689 15% $354,315 $326,723 8 %
Interest on
investments 108,153 78,577 38 400,191 271,707 47
Other interest 181 932 (81) 865 5,937 (85)
------------------------ ---------------------------
Total
interest
income 202,024 161,198 25 755,371 604,367 25
------------------------ ---------------------------
Interest expense
Interest on
deposits:
Demand 13,294 13,201 1 55,413 63,554 (13)
Savings 7,109 6,942 2 30,232 32,647 (7)
Time 18,374 22,270 (17) 81,567 98,084 (17)
------------------------ ---------------------------
Total
interest on
deposits 38,777 42,413 (9) 167,212 194,285 (14)
Interest on other
borrowed money 728 289 152 1,839 3,508 (48)
Interest on long-
term debt 3,023 1,026 195 13,565 5,248 158
------------------------ ---------------------------
Total
interest
expense 42,528 43,728 (3) 182,616 203,041 (10)
------------------------ ---------------------------
Net interest
income 159,496 117,470 36 572,755 401,326 43
Provision for loan
losses 8,000 7,458 7 33,150 26,384 26
------------------------ ---------------------------
Net interest
income after
provision for
loan losses 151,496 110,012 38 539,605 374,942 44
Noninterest income
Deposit charges
and service fees 36,599 28,011 31 130,993 100,912 30
Other operating
income 33,616 25,531 32 126,473 94,913 33
Net investment
securities gains 0 0 0 0 980 (100)
------------------------ ---------------------------
Total
noninterest
income 70,215 53,542 31 257,466 196,805 31
------------------------ ---------------------------
Total
Revenues 229,711 171,012 34 830,221 598,131 39
---- ----
Noninterest
expense
Salaries and
benefits 78,446 56,378 39 276,933 198,034 40
Occupancy 16,102 11,586 39 56,498 39,152 44
Furniture and
equipment 18,995 14,220 34 66,700 50,724 31
Office 8,643 7,427 16 31,186 26,808 16
Audit and
regulatory fees
and assessments 1,391 1,048 33 5,215 4,024 30
Marketing 4,910 5,460 (10) 23,733 18,378 29
Other 32,392 26,030 24 118,903 82,916 43
------------------------ ---------------------------
Total
noninterest
expenses 160,879 122,149 32 579,168 420,036 38
------------------------ ---------------------------
Income before
income taxes 60,832 41,405 47 217,903 151,711 44
Provision for
federal and state
income taxes 20,258 13,175 54 73,088 48,689 50
------------------------ ---------------------------
Net income $40,574 $28,230 44% $144,815 $103,022 41 %
======================== ===========================
Net income per
common and common
equivalent share:
Basic $0.60 $0.43 40% $2.16 $1.59 36 %
------------------------ ---------------------------
Diluted $0.57 $0.41 39 $2.04 $1.51 35
------------------------ ---------------------------
Average common and
common equivalent
shares outstanding:
Basic 67,548 65,418 3 66,795 64,666 3
------------------------ ---------------------------
Diluted 71,505 69,094 3 70,903 68,102 4
------------------------ ---------------------------
Cash dividends,
common stock $0.15 $0.14 7% $0.60 $0.55 9 %
======================== ===========================
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