Commerce Bancshares, Inc. Reports Second Quarter Earnings Per Share Growth of 5%.KANSAS CITY Kansas City, two adjacent cities of the same name, one (1990 pop. 149,767), seat of Wyandotte co., NE Kansas (inc. 1859), the other (1990 pop. 435,146), Clay, Jackson, and Platte counties, NW Mo. (inc. 1850). , Mo. -- Commerce Bancshares This article is about the bank headquartered in Kansas City, Missouri. For other uses, see Commerce Bank. Commerce Bancshares (NASDAQ: CBSH) is a Kansas City, Missouri based bank with branches in Kansas, Missouri, Illinois, and Oklahoma. , Inc. (Nasdaq:CBSH) announced record earnings of $.80 per share for the three months ended June June: see month. 30, 2005, an increase of 5% compared to $.76 per share in the second quarter 2004 and $.73 in the first quarter 2005. Net income for the second quarter 2005 amounted to $54.4 million compared to $53.8 million in the same period last year and $49.8 million in the first quarter 2005. For the second quarter, the return on average equity was 15.8% and the return on assets Return on assets (ROA) Indicator of profitability. Determined by dividing net income for the past 12 months by total average assets. Result is shown as a percentage. ROA can be decomposed into return on sales (net income/sales) multiplied by asset utilization (sales/assets). was 1.55%. The efficiency ratio for the quarter totaled 58.3%. For the first six months ended June 30, 2005, earnings per share totaled $1.53, an increase of 4% compared with $1.47 in 2004. Net income amounted to $104.2 million compared with $105.2 million for 2004. The return on average assets was 1.50% and the return on average equity was 15.1%. In announcing these results, David W. Kemper Kemper may refer to:
Of or relating to a variable that has been mathematically converted to a yearly rate. Inflation and interest rates are generally annualized since it is on this basis that these two variables are ordinarily stated and compared. growth of 6% in both loans and deposits in the second quarter contributed to the improved net interest margin and allowed a planned reduction in the securities portfolio. Non-interest expense remained well controlled and declined in the second quarter compared with the previous quarter. In the first six months of 2005, revenues from both personal deposit and bank card transaction fees, two of our largest payment system products, experienced double-digit dou·ble-dig·it adj. Being between 10 and 99 percent: double-digit inflation. growth compared to the prior year and reflect continued strong results in these products." Mr. Kemper continued: "Asset quality remained strong this quarter with net charge-offs totaling $7.0 million, or .33% of total average loans. Net charge-offs for the first six months of 2005 were .26% of average loans compared with .46% last year. Our allowance for loan losses at June 30, 2005, totaled $129.4 million and was 806% of non-performing loans A non-performing loan is a loan that is in default or close to being in default. Many loans become non-performing after being in default for 3 months, but this can depend on the contract terms. . Our loan loss reserve amounted to 1.52% of total loans." Total assets at June 30, 2005, were $14.1 billion, total loans were $8.5 billion, and total deposits were $10.7 billion. Non-performing loans amounted to $16.1 million or .19% of total loans. During the quarter the Company purchased 1.3 million shares of its common stock through its treasury buyback Buyback The buying back of outstanding shares (repurchase) by a company in order to reduce the number of shares on the market. Companies will buyback shares either to increase the value of shares still available (reducing supply), or to eliminate any threats by shareholders who may plan. Commerce Bancshares, Inc. is a registered bank holding company offering a full line of banking services, including investment management and securities brokerage BROKERAGE, contracts. The trade or occupation of a broker; the commissions paid to a broker for his services. . The Company currently operates in approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. 330 banking locations in Missouri Missouri, state, United States Missouri (mĭz  r`ē, –ə), one of the midwestern states of the United States. , Illinois Illinois, river, United StatesIllinois, river, 273 mi (439 km) long, formed by the confluence of the Des Plaines and Kankakee rivers, NE Ill., and flowing SW to the Mississippi at Grafton, Ill. It is an important commercial and recreational waterway. , and Kansas Kansas, state, United States Kansas (kăn`zəs), midwestern state occupying the center of the coterminous United States. It is bordered by Missouri (E), Oklahoma (S), Colorado (W), and Nebraska (N). . The Company also has operating subsidiaries An operating subsidiary is a business term frequently used within the United States railroad industry. In the case of a railroad, it refers to a company that is a subsidiary but operates with its own identity and rolling stock. involved in mortgage banking, credit related insurance, venture capital, and real estate activities. Posted to the Company's web site is management's discussion of second quarter results. To see this information please visit our web site at www.commercebank.com.
(Amounts in thousands) 3/31/05 6/30/05 6/30/04
----------------------------------------------------------------------
Non-Accrual Loans $17,333 $16,060 $27,654
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Foreclosed Real Estate $1,262 $542 $1,877
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Total Non-Performing Assets $18,595 $16,602 $29,531
----------------------------------------------------------------------
Non-Performing Assets to Loans .22% .20% .36%
----------------------------------------------------------------------
Non-Performing Assets to Total Assets .13% .12% .20%
----------------------------------------------------------------------
Loans 90 Days & Over Past Due -
Still Accruing $15,972 $15,070 $16,481
======================================================================
COMMERCE BANCSHARES, INC. and SUBSIDIARIES
FINANCIAL HIGHLIGHTS
----------------------------------------------------------------------
======================================================================
For the Six
For the Three Months Ended Months Ended
(Unaudited) March 31 June 30 June 30 June 30 June 30
2005 2005 2004 2005 2004
----------------------------------------------------------------------
FINANCIAL SUMMARY (In thousands, except per share data)
Net interest
income $121,477 $127,387 $126,461 $248,864 $249,445
Taxable
equivalent
net interest
income 121,994 128,044 127,025 250,038 250,597
Non-interest
income 80,691 84,980 84,289 165,671 170,258
Provision for
loan losses 2,368 5,503 6,280 7,871 16,530
Non-interest
expense 123,922 123,012 120,936 246,934 239,848
Net income 49,846 54,368 53,838 104,214 105,162
Cash dividends 16,133 15,970 15,340 32,103 30,841
Net total loan
charge-offs 3,802 7,035 6,248 10,837 18,627
Net business
charge-offs
(recov) (2,771) (48) (223) (2,819) 5,337
Net credit
card charge-
offs 4,597 5,430 4,993 10,027 9,869
Net personal
banking
charge-
offs(a) 1,948 1,474 1,260 3,422 3,232
Net real
estate
charge-offs
(recov) (56) (19) 73 (75) 175
Net
overdraft
charge-offs 84 198 145 282 14
Per share:
Net income -
basic $0.74 $0.81 $0.77 $1.55 $1.49
Net income -
diluted $0.73 $0.80 $0.76 $1.53 $1.47
Cash
dividends $0.240 $0.240 $0.219 $0.480 $0.438
Diluted wtd.
average shares
o/s 68,582 67,653 71,334 68,115 71,775
======================================================================
RATIOS
Average loans
to deposits 79.45% 79.35% 78.13% 79.40% 78.99%
Return on
total average
assets 1.44% 1.55% 1.51% 1.50% 1.48%
Return on
total average
stockholders'
equity 14.35% 15.78% 14.91% 15.07% 14.50%
Non-interest
income to
revenue(b) 39.91% 40.02% 39.99% 39.97% 40.57%
Efficiency
ratio(c) 62.22% 58.27% 57.96% 60.18% 58.58%
======================================================================
AT PERIOD END
Book value per
share based on
total
stockholders'
equity $20.42 $20.82 $20.12
Market value
per share $48.20 $50.41 $43.76
Allowance for
loan losses as
a percentage
of loans 1.56% 1.52% 1.64%
Tier I
leverage
ratio 9.46% 9.37% 9.47%
Common shares
outstanding 67,176,629 66,104,839 69,974,678
Shareholders
of record 4,735 4,584 4,845
Number of
bank/ATM
locations 331 337 327
Number of bank
charters 3 3 4
Full-time
equivalent
employees 4,836 4,826 4,822
==================================================
OTHER YTD June 30 June 30
INFORMATION 2005 2004
--------------------------------------------------
High market
value per
share $50.93 $47.62
Low market
value per
share $46.14 $41.90
==================================================
(a) Includes consumer, student and home equity loans.
(b) Revenue includes net interest income and non-interest income.
(c) The efficiency ratio is calculated as non-interest expense
(excluding intangibles amortization) as a percent of net interest
income and non-interest income (excluding gains/losses on
securities transactions).
COMMERCE BANCSHARES, INC. and SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
----------------------------------------------------------------------
======================================================================
(Unaudited) For the Six
(In thousands, For the Three Months Ended Months Ended
except per March 31 June 30 June 30 June 30 June 30
share data) 2005 2005 2004 2005 2004
----------------------------------------------------------------------
INTEREST INCOME
Interest and
fees on loans $118,523 $125,242 $102,753 $243,765 $206,762
Interest on
investment
securities 41,746 46,394 49,348 88,140 93,940
Interest on federal
funds sold and
securities purchased
under agreements to
resell 584 1,164 339 1,748 525
--------- --------- --------- --------- ---------
Total interest
income 160,853 172,800 152,440 333,653 301,227
--------- --------- --------- --------- ---------
INTEREST EXPENSE
Interest on
deposits:
Savings, interest
checking and money
market 10,457 12,192 6,320 22,649 12,492
Time open and
C.D.'s of less
than $100,000 10,392 12,051 9,592 22,443 19,491
Time open and
C.D.'s of
$100,000 and over 6,352 7,973 3,571 14,325 6,836
Interest on other
borrowings 12,175 13,197 6,496 25,372 12,963
--------- --------- --------- --------- ---------
Total interest
expense 39,376 45,413 25,979 84,789 51,782
--------- --------- --------- --------- ---------
Net interest
income 121,477 127,387 126,461 248,864 249,445
Provision for loan
losses 2,368 5,503 6,280 7,871 16,530
--------- --------- --------- --------- ---------
Net interest
income after
provision for
loan losses 119,109 121,884 120,181 240,993 232,915
--------- --------- --------- --------- ---------
NON-INTEREST INCOME
Trust fees 16,394 17,040 16,128 33,434 32,292
Deposit account
charges and other
fees 24,301 27,476 26,930 51,777 52,452
Bank card
transaction fees 19,507 21,295 19,348 40,802 36,948
Trading account
profits and
commissions 2,614 2,450 2,970 5,064 6,796
Consumer brokerage
services 2,825 2,338 2,481 5,163 4,939
Loan fees and sales 3,440 4,805 5,254 8,245 8,907
Net gains on
securities
transactions 3,612 1,372 2,833 4,984 11,784
Other 7,998 8,204 8,345 16,202 16,140
--------- --------- --------- --------- ---------
Total non-
interest income 80,691 84,980 84,289 165,671 170,258
--------- --------- --------- --------- ---------
NON-INTEREST EXPENSE
Salaries and
employee benefits 70,180 67,585 65,696 137,765 133,712
Net occupancy 9,778 9,527 9,834 19,305 20,000
Equipment 5,691 5,701 5,678 11,392 11,536
Supplies and
communication 8,213 8,257 8,342 16,470 16,286
Data processing and
software 11,455 12,069 11,802 23,524 22,432
Marketing 3,862 4,687 4,424 8,549 8,128
Other intangible
assets amortization 381 67 433 448 869
Other 14,362 15,119 14,727 29,481 26,885
--------- --------- --------- --------- ---------
Total non-
interest
expense 123,922 123,012 120,936 246,934 239,848
--------- --------- --------- --------- ---------
Income before
income taxes 75,878 83,852 83,534 159,730 163,325
Less income taxes 26,032 29,484 29,696 55,516 58,163
--------- --------- --------- --------- ---------
NET INCOME $49,846 $54,368 $53,838 $104,214 $105,162
-------------------- ========= ========= ========= ========= =========
Net income per share
- basic $0.74 $0.81 $0.77 $1.55 $1.49
========= ========= ========= ========= =========
Net income per share
- diluted $0.73 $0.80 $0.76 $1.53 $1.47
========= ========= ========= ========= =========
Cash dividends per
common share $0.240 $0.240 $0.219 $0.480 $0.438
======================================================================
COMMERCE BANCSHARES, INC. and SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
======================================================================
(Unaudited) March 31 June 30 June 30
(In thousands) 2005 2005 2004
----------------------------------------------------------------------
ASSETS
Loans, net of unearned income $8,406,110 $8,499,301 $8,107,924
Allowance for loan losses (130,960) (129,428) (133,124)
------------ ------------ ------------
Net loans 8,275,150 8,369,873 7,974,800
------------ ------------ ------------
Investment securities:
Available for sale 4,442,210 4,358,178 4,792,606
Trading 13,154 12,359 17,673
Non-marketable 74,965 73,674 72,141
------------ ------------ ------------
Total investment
securities 4,530,329 4,444,211 4,882,420
------------ ------------ ------------
Federal funds sold and
securities purchased under
agreements to resell 179,107 128,204 134,805
Cash and due from banks 502,362 544,922 860,203
Land, buildings and
equipment - net 368,512 372,291 339,269
Goodwill 48,522 48,522 48,522
Other intangible
assets - net 118 54 1,321
Other assets 199,172 210,116 183,547
------------ ------------ ------------
Total assets $14,103,272 $14,118,193 $14,424,887
============ ============ ============
LIABILITIES AND
STOCKHOLDERS' EQUITY
Deposits:
Non-interest bearing demand $1,347,994 $1,351,186 $1,723,109
Savings, interest checking
and money market 6,552,169 6,547,940 6,130,449
Time open and C.D.'s of
less than $100,000 1,700,853 1,744,629 1,669,858
Time open and C.D.'s of
$100,000 and over 1,084,407 1,022,361 847,332
------------ ------------ ------------
Total deposits 10,685,423 10,666,116 10,370,748
Federal funds purchased
and securities sold under
agreements to repurchase 1,566,914 1,594,735 2,157,542
Other borrowings 388,328 371,781 393,625
Other liabilities 91,038 109,392 94,883
------------ ------------ ------------
Total liabilities 12,731,703 12,742,024 13,016,798
------------ ------------ ------------
Stockholders' equity:
Preferred stock --- --- ---
Common stock 347,049 347,049 343,183
Capital surplus 385,792 384,166 353,359
Retained earnings 737,006 775,404 781,457
Treasury stock (103,696) (155,749) (89,473)
Accumulated other
comprehensive income 5,418 25,299 19,563
------------ ------------ ------------
Total stockholders' equity 1,371,569 1,376,169 1,408,089
------------ ------------ ------------
Total liabilities and
stockholders' equity $14,103,272 $14,118,193 $14,424,887
======================================================================
COMMERCE BANCSHARES, INC. and SUBSIDIARIES
AVERAGE BALANCES
----------------------------------------------------------------------
======================================================================
For the Three Months Ended For the Six Months Ended
March 31 June 30 June 30 June 30 June 30
2005 2005 2004 2005 2004
----------------------------------------------------------------------
(Unaudited)
(Dollars in thousands)
Loans:
Business $2,246,288 $2,305,000 $2,124,532 $2,275,806 $2,105,495
Real
estate -
con-
struction 442,471 478,675 439,082 460,673 432,632
Real estate
- business 1,758,141 1,765,896 1,850,935 1,762,040 1,866,072
Real estate
- personal 1,335,024 1,344,203 1,329,562 1,339,639 1,330,288
Consumer 1,193,063 1,225,386 1,184,229 1,209,314 1,168,070
Home equity 412,356 422,637 371,135 417,525 364,119
Student 410,020 374,176 288,637 391,999 335,347
Credit card 546,946 553,965 509,310 550,475 510,048
Overdrafts 16,297 11,651 10,779 13,961 14,128
----------- ----------- ----------- ----------- -----------
Total
loans 8,360,606 8,481,589 8,108,201 8,421,432 8,126,199
----------- ----------- ----------- ----------- -----------
Investment
securities
(excluding
unrealized
gains and
losses):
Available
for sale 4,504,318 4,345,329 4,950,254 4,424,384 4,903,690
Trading 11,369 7,864 25,151 9,607 16,792
Non-
marketable 76,853 75,968 77,663 76,408 76,157
----------- ----------- ----------- ----------- -----------
Total
investment
securities 4,592,540 4,429,161 5,053,068 4,510,399 4,996,639
----------- ----------- ----------- ----------- -----------
Federal
funds
sold and
securities
purchased
under
agreements
to resell 84,987 145,135 111,170 115,227 85,784
Total
interest
earning
assets 13,038,133 13,055,885 13,272,439 13,047,058 13,208,622
=========== =========== =========== =========== ===========
Total
assets 14,070,385 14,024,246 14,323,830 14,047,188 14,258,715
=========== =========== =========== =========== ===========
Deposits:
Non-
interest
bearing
deposits 772,869 633,473 1,275,569 702,786 1,254,744
Interest
bearing
deposits:
Savings 403,844 417,059 411,260 410,488 401,975
Interest
checking 262,460 175,820 503,039 218,900 492,972
Money
market 6,439,761 6,644,696 5,661,088 6,542,796 5,644,374
Time open
& C.D.'s
of less
than
$100,000 1,664,823 1,732,288 1,685,584 1,698,742 1,700,311
Time open
& C.D.'s
of
$100,000
and over 979,011 1,085,769 841,283 1,032,685 793,192
----------- ----------- ----------- ----------- -----------
Total
interest
bearing
deposits 9,749,899 10,055,632 9,102,254 9,903,611 9,032,824
----------- ----------- ----------- ----------- -----------
Total
deposits 10,522,768 10,689,105 10,377,823 10,606,397 10,287,568
----------- ----------- ----------- ----------- -----------
Borrowings:
Federal
funds
purchased
and
securities
sold under
agreements
to
repurchase 1,655,050 1,481,135 1,911,587 1,567,611 1,929,397
Other
borrowings 388,771 380,043 453,931 384,383 447,475
----------- ----------- ----------- ----------- -----------
Total
borrowings 2,043,821 1,861,178 2,365,518 1,951,994 2,376,872
----------- ----------- ----------- ----------- -----------
Total
interest
bearing
lia-
bilities 11,793,720 11,916,810 11,467,772 11,855,605 11,409,696
Total
stock-
holders'
equity 1,408,414 1,381,560 1,452,019 1,394,913 1,458,467
Net yield
on interest
earning
assets
(tax-
equival-
ent basis) 3.79% 3.93% 3.85% 3.86% 3.82%
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