This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Commerce Bancshares, Inc. Announces Third Quarter Earnings Per Share Of $.76

Stocks in this article: CBSH

Commerce Bancshares, Inc. (NASDAQ: CBSH) announced earnings of $.76 per share for the three months ended September 30, 2011 compared to $.64 per share in the third quarter of 2010, or an increase of 18.8%. Net income for the third quarter amounted to $65.4 million compared to $55.9 million in the same quarter last year. For the quarter, the return on average assets totaled 1.32%, the return on average equity was 12.2% and the efficiency ratio was 58.7%.

For the nine months ended September 30, 2011, earnings per share totaled $2.24 compared to $1.82 for the first nine months of 2010, an increase of 23.1%. Net income amounted to $194.8 million for the first nine months of 2011 compared with $159.8 million for the same period last year, or an increase of $35.1 million. The return on average assets for the first nine months of 2011 was 1.37%.

In announcing these results, David W. Kemper, Chairman and CEO, said, “We are pleased to report a 16.9% increase in net income in the third quarter of 2011 compared with the same period last year. This growth in net income was primarily the result of a $10.4 million decline in our provision for loan losses coupled with flat expenses. Compared to the same period in the previous year, bankcard and trust fees grew 11.7% and 9.6%, respectively. Deposits increased to $16.0 billion this quarter, however, loan demand remained weak and, coupled with record low interest rates, interest margins were pressured.”

Further, Mr. Kemper noted, “Net loan charge-offs in the current quarter totaled $14.9 million, compared to $15.2 million in the previous quarter and $21.8 million in the third quarter of 2010. Bankcard net loan charge-offs declined to $7.1 million this quarter, or 3.8% of average bankcard loans, while commercial loan net charge-offs totaled only $3.5 million. As a result of this improved credit environment, our allowance for loan losses declined by $3.5 million during the current quarter to $188.0 million, and represents 2.5 times our non-performing loans. Total non-performing assets decreased this quarter to $99.7 million, but represents only 1.1% of our total loans. Our ratio of tangible common equity to assets was 9.7%, while our loans to deposits ratio totaled 58.3%, reflecting strong capital and liquidity positions.”

Total assets at September 30, 2011 were $20.6 billion, total loans were $9.1 billion, and total deposits were $16.0 billion.

Commerce Bancshares, Inc. is a registered bank holding company offering a full line of banking services, including investment management and securities brokerage. The Company currently operates in over 360 locations in Missouri, Illinois, Kansas, Oklahoma and Colorado. The Company also has operating subsidiaries involved in mortgage banking, credit related insurance, and private equity activities.

Summary of Non-Performing Assets and Past Due Loans

(Dollars in thousands)   6/30/2011   9/30/2011   9/30/2010
Non-Accrual Loans   $ 79,717   $ 75,912   $ 89,609
Foreclosed Real Estate   $ 23,551     $ 23,813     $ 12,539  
Total Non-Performing Assets   $ 103,268     $ 99,725     $ 102,148  
Non-Performing Assets to Loans   1.12 %   1.10 %   1.05 %
Non-Performing Assets to Total Assets   .53 %   .48 %   .54 %
Loans 90 Days & Over Past Due — Still Accruing   $ 23,598     $ 20,104     $ 42,723  
 

This financial news release, including management’s discussion of third quarter results, is posted to the Company’s website at www.commercebank.com .

For additional information, contact Jeffery Aberdeen, Controller at PO Box 419248, Kansas City, MO or by telephone at (816) 234-2081 Website: http://www.commercebank.com Email: mymoney@commercebank.com

 

COMMERCE BANCSHARES, INC. and SUBSIDIARIES

FINANCIAL HIGHLIGHTS

  For the Three Months Ended   For the Nine Months Ended
(Unaudited)   June 30,2011   September 30, 2011   September 30,2010   September 30, 2011   September 30,2010
FINANCIAL SUMMARY (In thousands, except per share data)  
Net interest income $ 164,710   $ 158,630   $ 159,437 $ 484,313 $ 485,255
Taxable equivalent net interest income 170,779 164,317 164,773 501,575 500,133
Non-interest income 101,344 101,632 100,010 298,882 294,657
Investment securities gains (losses), net 1,956 2,587 16 5,870 (2,989 )
Provision for loan losses 12,188 11,395 21,844 39,372 78,353
Non-interest expense 153,513 153,746 155,586 461,219 467,103
Net income attributable to
Commerce Bancshares, Inc. 69,034 65,352 55,885 194,839 159,789
Cash dividends 20,056 19,526 19,621 59,636 58,836
Net total loan charge-offs 15,188 14,895 21,844 48,872 75,295
Business 1,439 889 582 4,338 3,072
Real estate — construction and land 1,125 1,215 1,971 4,326 13,417
Real estate — business 339 1,429 776 2,832 2,229
Consumer credit card 8,490 7,103 12,592 24,631 37,995
Consumer 2,229 3,232 4,914 9,474 15,184
Revolving home equity 344 72 276 783 1,506
Real estate — personal 1,027 673 379 1,974 1,095
Overdraft 195 282 354 514 797
Per common share:
Net income — basic $ .80 $ .76 $ .63 $ 2.25 $ 1.82
Net income — diluted $ .79 $ .76 $ .64 $ 2.24 $ 1.82
Cash dividends $ .230 $ .230 $ .224 $ .690 $ .671
Diluted wtd. average shares o/s   86,927     85,464     87,560     86,404     87,535  
RATIOS
Average loans to deposits (1) 60.17 % 58.29 % 68.88 % 60.27 % 71.88 %
Return on total average assets 1.47 % 1.32 % 1.19 % 1.37 % 1.17 %
Return on total average equity 13.12 % 12.15 % 10.98 % 12.41 % 10.85 %
Non-interest income to revenue (2) 38.09 % 39.05 % 38.55 % 38.16 % 37.78 %
Efficiency ratio (3)   57.40 %   58.71 %   59.58 %   58.57 %   59.49 %
AT PERIOD END
Book value per share based on total equity $ 24.55 $ 25.15 $ 23.37
Market value per share $ 43.00 $ 34.75 $ 35.80
Allowance for losses as a percentage
of loans 2.07 % 2.07 % 2.04 %
Tier I leverage ratio 10.32 % 9.74 % 9.93 %
Tangible common equity to assets ratio (4) 10.27 % 9.72 % 10.26 %
Common shares outstanding 86,840,077 84,690,060 87,578,505
Shareholders of record 4,253 4,224 4,311
Number of bank/ATM locations 364 363 369
Full-time equivalent employees   4,786     4,762     5,011  
OTHER QTD INFORMATION
High market value per share $ 43.90 $ 44.00 $ 38.42
Low market value per share   $ 40.05     $ 33.23     $ 33.43  
 

(1)

 

Includes loans held for sale.

(2)

Revenue includes net interest income and non-interest income.

(3)

The efficiency ratio is calculated as non-interest expense (excluding intangibles amortization) as a percent of revenue.

(4)

The tangible common equity ratio 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).

 

COMMERCE BANCSHARES, INC. and SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

  For the Three Months Ended     For the Nine Months Ended
(Unaudited)

(In thousands, except per share data)

  June 30,2011     September 30, 2011     September 30,2010     September 30, 2011     September 30,2010
Interest income $ 178,087     $ 170,835     $ 178,916 $ 524,748     $ 552,042
Interest expense 13,377   12,205   19,479   40,435   66,787  
Net interest income 164,710 158,630 159,437 484,313 485,255
Provision for loan losses 12,188   11,395   21,844   39,372   78,353  
Net interest income after provision for loan losses 152,522   147,235   137,593   444,941   406,902  
NON-INTEREST INCOME
Bank card transaction fees 41,304 42,149 37,723 120,915 107,872
Trust fees 22,544 22,102 20,170 66,218 59,846
Deposit account charges and other fees 20,789 21,939 21,693 62,028 71,146
Bond trading income 4,979 5,556 5,133 15,255 15,524
Consumer brokerage services 2,880 2,333 2,390 7,876 6,879
Loan fees and sales 2,075 2,034 5,830 5,933 11,141
Other 6,773   5,519   7,071   20,657   22,249  
Total non-interest income 101,344   101,632   100,010   298,882   294,657  
INVESTMENT SECURITIES
GAINS (LOSSES), NET
Impairment (losses) reversals on debt securities (2,119 ) (1,200 ) 5,645 2,986 11,355
Noncredit-related losses (reversals) on
securities not expected to be sold 1,469   369   (7,690 ) (4,741 ) (15,533 )
Net impairment losses (650 ) (831 ) (2,045 ) (1,755 ) (4,178 )
Realized gains on sales and
fair value adjustments 2,606   3,418   2,061   7,625   1,189  
Investment securities gains (losses), net 1,956   2,587   16   5,870   (2,989 )
NON-INTEREST EXPENSE
Salaries and employee benefits 84,223 85,700 85,442 257,315 259,988
Net occupancy 11,213 11,510 12,086 34,760 35,697
Equipment 5,702 5,390 5,709 16,669 17,548
Supplies and communication 5,692 5,674 6,724 16,898 20,891
Data processing and software 17,531 16,232 16,833 50,230 50,936
Marketing 4,495 4,545 5,064 13,298 14,784
Deposit insurance 2,780 2,772 4,756 10,443 14,445
Indemnification obligation (1,359 ) (1,683 )
Other 21,877   21,923   18,972   62,965   54,497  
Total non-interest expense 153,513   153,746   155,586   461,219   467,103  
Income before income taxes 102,309 97,708 82,033 288,474 231,467
Less income taxes 32,692   31,699   26,012   91,898   71,817  
Net income 69,617 66,009 56,021 196,576 159,650
Less non-controlling interest expense (income)

583

 

657   136   1,737     (139 )
Net income attributable to
Commerce Bancshares, Inc. $ 69,034   $ 65,352   $ 55,885   $ 194,839   $ 159,789  
Net income per common share — basic $ .80   $ .76   $ .63   $ 2.25   $ 1.82  
Net income per common share — diluted   $ .79       $ .76       $ .64       $ 2.24       $ 1.82  
 

COMMERCE BANCSHARES, INC. and SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(Unaudited)

(In thousands)

  June 30,2011   September 30, 2011   September 30,2010
ASSETS      
Loans $ 9,237,078 $ 9,073,123 $ 9,706,265
Allowance for loan losses (191,538 ) (188,038 ) (197,538 )
Net loans 9,045,540   8,885,085   9,508,727  
Loans held for sale 42,359 39,576 248,108
Investment securities:
Available for sale 7,717,634 9,278,066 7,164,273
Trading 32,074 9,695 20,828
Non-marketable 109,867   111,808   110,487  
Total investment securities 7,859,575   9,399,569   7,295,588  
Short-term federal funds sold and securities purchased under agreements to resell 10,845 11,400 4,550
Long-term securities purchased under agreements to resell 850,000 850,000 350,000
Interest earning deposits with banks 535,696 133,419 4,047
Cash and due from banks 340,594 424,861 412,315
Land, buildings and equipment — net 374,732 368,965 387,792
Goodwill 125,585 125,585 125,585
Other intangible assets — net 9,394 8,452 11,285
Other assets 376,540   391,756   403,762  
Total assets $ 19,570,860   $ 20,638,668   $ 18,751,759  
LIABILITIES AND STOCKHOLDERS’ EQUITY
Deposits:
Non-interest bearing $ 4,834,750 $ 5,003,587 $ 4,170,224
Savings, interest checking and money market 8,139,989 8,416,839 7,294,794
Time open and C.D.’s of less than $100,000 1,273,961 1,204,896 1,607,664
Time open and C.D.’s of $100,000 and over 1,407,866   1,388,755   1,318,877  
Total deposits 15,656,566 16,014,077 14,391,559
Federal funds purchased and securities sold under agreements to repurchase 1,282,470 1,057,728 1,530,555
Other borrowings 111,929 111,869 337,863
Other liabilities 388,328   1,325,029   445,177  
Total liabilities 17,439,293   18,508,703   16,705,154  
Stockholders’ equity:
Preferred stock
Common stock 436,481 436,481 417,827
Capital surplus 979,247 980,176 865,246
Retained earnings 645,155 690,981 669,485
Treasury stock (14,515 ) (96,205 ) (2,323 )
Accumulated other comprehensive income 83,000   115,781   95,204  
Total stockholders’ equity 2,129,368 2,127,214 2,045,439
Non-controlling interest 2,199   2,751   1,166  
Total equity 2,131,567   2,129,965   2,046,605  
Total liabilities and equity   $ 19,570,860     $ 20,638,668     $ 18,751,759  
 

COMMERCE BANCSHARES, INC. and SUBSIDIARIES

AVERAGE BALANCE SHEETS — AVERAGE RATES AND YIELDS

(Unaudited)

(Dollars in thousands)

  For the Three Months Ended
June 30, 2011   September 30, 2011   September 30, 2010
Average Balance   Avg. Rates Earned/Paid Average Balance   Avg. Rates Earned/Paid Average Balance   Avg. Rates Earned/Paid
ASSETS:      
Loans:
Business (A) $ 2,959,012 3.64 % $ 2,815,064 3.56 % $ 2,917,798 3.82 %
Real estate — construction and land 429,649 4.51 412,490 4.42 530,472 4.00
Real estate — business 2,100,726 4.94 2,123,034 4.74 1,998,500 5.10
Real estate — personal 1,440,747 4.87 1,430,014 4.75 1,450,898 5.13
Consumer 1,112,315 6.32 1,104,684 6.20 1,234,138 6.65
Revolving home equity 468,380 4.24 466,503 4.27 485,034 4.32
Student 315,150 2.40
Consumer credit card 743,317 11.13 735,179 11.59 762,987 11.29
Overdrafts 6,654       6,936       6,667      
Total loans (B) 9,260,800     5.12   9,093,904     5.07   9,701,644     5.21  
Loans held for sale 52,390 2.37 41,677 2.57 305,013 1.78
Investment securities:
U.S. government & federal agency 576,693 6.67 590,003 3.19 672,447 1.44
State & municipal obligations (A) 1,160,164 4.75 1,185,263 4.20 982,137 4.53
Mortgage and asset-backed securities 5,460,506 2.61 6,167,884 2.24 5,100,958 2.77
Other marketable securities (A) 172,754     4.18   172,588     4.27   182,966     5.18  
Total available for sale securities (B) 7,370,117 3.30 8,115,738 2.64 6,938,508 2.95
Trading securities (A) 20,456 2.78 20,770 2.52 22,525 2.87
Non-marketable securities (A) 105,015     6.24   110,585     6.59   109,215     9.43  
Total investment securities 7,495,588     3.34   8,247,093     2.69   7,070,248     3.05  
Short-term federal funds sold and securities
purchased under agreements to resell 16,513 .53 10,927 .47 6,903 .69
Long-term securities purchased
under agreements to resell 803,846 1.58 850,000 1.83 199,302 1.72
Interest earning deposits with banks 179,763     .25   326,302     .26   170,504     .25  
Total interest earning assets 17,808,900   4.15   18,569,903   3.77   17,453,614   4.19  
Non-interest earning assets (B) 1,054,328   1,094,161   1,167,692  
Total assets $ 18,863,228   $ 19,664,064   $ 18,621,306  
LIABILITIES AND EQUITY:
Interest bearing deposits:
Savings $ 537,364 .14 $ 534,295 .19 $ 481,997 .16
Interest checking and money market 7,580,895 .33 7,756,104 .32 6,793,839 .41
Time open & C.D.’s of less than $100,000 1,324,192 .90 1,231,280 .78 1,642,200 1.32
Time open & C.D.’s of $100,000 and over 1,466,214     .67   1,372,842     .62   1,417,162     .97  
Total interest bearing deposits 10,908,665     .43   10,894,521     .40   10,335,198     .62  
Borrowings:
Federal funds purchased and securities
sold under agreements to repurchase 952,032 .29 1,016,623 .11 1,023,961 .23
Other borrowings 112,099     3.29   111,930     3.28   350,328     3.09  
Total borrowings 1,064,131     .61   1,128,553     .43   1,374,289     .96  
Total interest bearing liabilities 11,972,796   .45 % 12,023,074   .40 % 11,709,487   .66 %
Non-interest bearing deposits 4,570,721 4,778,780 4,192,026
Other liabilities 208,606 728,974 700,754
Equity 2,111,105   2,133,236   2,019,039  
Total liabilities and equity $ 18,863,228   $ 19,664,064   $ 18,621,306  
Net interest income (T/E) $ 170,779   $ 164,317   $ 164,773  
Net yield on interest earning assets       3.85 %       3.51 %       3.75 %
 

(A)

 

Stated on a tax equivalent basis using a federal income tax rate of 35%.

(B)

The allowance for loan losses and unrealized gains/(losses) on available for sale securities are included in non-interest earning assets.

 

COMMERCE BANCSHARES, INC. Management Discussion of Third Quarter Results September 30, 2011

For the quarter ended September 30, 2011, net income attributable to Commerce Bancshares, Inc. (net income) amounted to $65.4 million, an increase of $9.5 million over the same quarter last year, and a decrease of $3.7 million compared to the previous quarter. For the current quarter, the return on average assets was 1.32%, the return on average equity was 12.2%, and the efficiency ratio was 58.7%. Compared to the same quarter last year, net interest income (tax equivalent) decreased by $456 thousand to $164.3 million, while non-interest income increased to $101.6 million. Non-interest expense for the current quarter totaled $153.7 million, a decrease of $1.8 million from the same period last year. The provision for loan losses totaled $11.4 million, representing a decline of $10.4 million from the amount recorded in the same quarter last year.

1 of 5

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!

Markets

DOW 18,053.71 +23.50 0.13%
S&P 500 2,088.77 +6.89 0.33%
NASDAQ 4,806.8590 +33.3870 0.70%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs