Commerce reported third-quarter earnings of $66 million, or 75 cents a share, declining from $70.7 million, or 80 cents a share, in the second quarter, but increasing from $65.4 million, or 72 cents a share, during the third quarter of 2011. The year-over-year earnings improvement reflected a decline in credit expenses. The sequential earnings decline reflected a decline in net interest income to $153.8 million in the third quarter from $165.1 million in the second quarter, as the company's net interest margin -- the difference between the average yield on loans and investments and the average cost for deposits and borrowings -- narrowed by 25 basis points to 3.30%. KBW analyst Christopher McGratty said on Oct. 16 after Commerce announced its third-quarter results that "CBSH has strung together consecutive quarters of fairly healthy loan growth (5.5% and 11%, respectively, ann.), which should help to alleviate some, but not all, of the margin pressure it is experiencing." With so much excess capital "and a strong dividend history (44 straight years of an increase)," and in light of the possible elimination of the 15% cap on federal income taxes on qualified investment dividend income in 2013, McGratty said there was a good possibility for the company to declare a special dividend. Commerce did just that on Nov. 2, declaring a special dividend of $1.50, along with a 5% stock dividend, payable on Dec. 17 to shareholders of record, as of Nov. 30. CBSH data by YCharts Interested in more on Commerce Bancshares? See TheStreet Ratings' report card for this stock.