Commerce Bancshares, Inc. · NASDAQ:CBSH
Commerce Bancshares — Shareholder Meeting (April 2025)
49 slides from Commerce Bancshares's shareholder meeting presentation, Apr 25, 2025
Slide 1: Strategic Mindset for Growth
STRATEGIC MINDSET FOR GROWTH COMMERCE BANCSHARES, INC. ANNUAL SHAREHOLDERS’ MEETING April 25, 2025
Slide 2: Annual Shareholders' Meeting: Agenda
CBI ANNUAL SHAREHOLDERS’ MEETING: AGENDA 1 Call to Order and Welcome 2 Rules of Conduct 3 Secretary’s Report 4 Business Matters 5 Introduction of Public Accountants 6 CEO’s Presentation 7 Adjournment 2
Slide 3: Annual Shareholders' Meeting: Agenda
CBI ANNUAL SHAREHOLDERS’ MEETING: AGENDA 1 Call to Order and Welcome 2 Rules of Conduct 3 Secretary’s Report 4 Business Matters 5 Introduction of Public Accountants 6 CEO’s Presentation 7 Adjournment 3
Slide 4: Annual Shareholders' Meeting: Agenda
CBI ANNUAL SHAREHOLDERS’ MEETING: AGENDA 1 Call to Order and Welcome 2 Rules of Conduct 3 Secretary’s Report 4 Business Matters 5 Introduction of Public Accountants 6 CEO’s Presentation 7 Adjournment 4
Slide 5: Annual Shareholders' Meeting: Agenda
CBI ANNUAL SHAREHOLDERS’ MEETING: AGENDA 1 Call to Order and Welcome 2 Rules of Conduct 3 Secretary’s Report 4 Business Matters 5 Introduction of Public Accountants 6 CEO’s Presentation 7 Adjournment 5
Slide 6: Annual Shareholders' Meeting: Agenda
CBI ANNUAL SHAREHOLDERS’ MEETING: AGENDA 1 Call to Order and Welcome 2 Rules of Conduct 3 Secretary’s Report 4 Business Matters 5 Introduction of Public Accountants 6 CEO’s Presentation 7 Adjournment 6
Slide 7: Annual Shareholders' Meeting: Agenda
CBI ANNUAL SHAREHOLDERS’ MEETING: AGENDA 1 Call to Order and Welcome 2 Rules of Conduct 3 Secretary’s Report 4 Business Matters 5 Introduction of Public Accountants 6 CEO’s Presentation 7 Adjournment 7
Slide 8: Strategic Mindset for Growth: CEO Presentation
STRATEGIC MINDSET FOR GROWTH COMMERCE BANCSHARES, INC. ANNUAL SHAREHOLDERS’ MEETING John Kemper President and Chief Executive Officer April 25, 2025
Slide 9: Strategic Mindset for Growth
STRATEGIC MINDSET FOR GROWTH Investor.commercebank.com 2024 Annual Report 9
Slide 10: Cautionary Statement
CAUTIONARY STATEMENT A number of statements we will be making in our presentation and in the accompanying slides are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, such as statements of the Corporation’s plans, goals, objectives, expectations
Slide 11: Today's Discussion
TODAY’S DISCUSSION About Economic Our Strategic Commerce and Industry Strategic Mindset Bancshares Themes Position for Growth 11
Slide 12: Today's Discussion
TODAY’S DISCUSSION About Economic Our Strategic Commerce and Industry Strategic Mindset Bancshares Themes Position for Growth 12
Slide 13: 160 Years of Strength & Stability
COMMERCE BANCSHARES Commerce Bank is one of the Strongest Financial 160 YEARS OF STRENGTH & STABILITY Institutions in the U.S. 1 #2 With a Tier 1 risk-based capital CORE BANKING FOOTPRINT ratio of 16.71%, Commerce ranks St. Louis • Kansas City • Springfield Central Missouri • Central Illinois • Wich
Slide 14: Super-Community Bank Platform
SUPER-COMMUNITY BANK PLATFORM A consistent strategy with a long-term view Customer relationship-based: Community Bank Challenge Accepted.® Super-Regional Bank • Award-winning High-performing teams • Sophisticated payment customer service system capabilities and engaged workforce • Focus on the full
Slide 15: A Strong Culture Is the Foundation of Our Success
A STRONG CULTURE IS THE FOUNDATION OF OUR SUCCESS At Commerce, our core values shape the way we live and work: We have a We collaborate We act with We are We strive for long-term as one team integrity customer- excellence view focused How we put our culture into practice: What defines us, ultimately
Slide 16: Commerce's Focus Extends Beyond Banking
COMMERCE’S FOCUS EXTENDS BEYOND BANKING We seek opportunities to help make our communities and our company a better place to live and work 2024 Engagement MORE THAN and Enablement2 500 89% Consistently scoring above the U.S. Financial Services norms for engagement, enablement and effectiveness Nonpr
Slide 17: Recent Recognition
RECENT RECOGNITION 2025 2025 2025 Forbes Newsweek Forbes America’s Best America’s Best America’s Best Banks1 Midsize Employers2 Regional Banks3 8 consecutive years 2 consecutive years 2024 2024 2024 Center for Disability Inclusion Bank Director Forbes Leader in Top 25 U.S. Banks5 Best Employer Disab
Slide 18: Today's Discussion
TODAY’S DISCUSSION About Economic Our Strategic Commerce and Industry Strategic Mindset Bancshares Themes Position for Growth 18
Slide 19: Macroeconomic Environment: 2024 in Review
MACROECONOMIC ENVIRONMENT: 2024 IN REVIEW Evolving economic landscape presents challenges and opportunities GROWTH JOBS INTEREST RATES MARKETS • U.S. GDP grew by 2.8% • Unemployment rate • Fed cut interest rates • The S&P 500 reached in 2024, similar to hovered around 4% for the first time in four r
Slide 20: Key Themes Impacting the Bank Operating Environment
KEY THEMES IMPACTING THE BANK OPERATING ENVIRONMENT ECONOMIC OUTLOOK IMPLICATIONS FOR BANKS • Unstable • Elusive growth Banks need to be geopolitics prepared for the • Higher credit costs • Tariffs – prospects uncertain. of a trade war • Importance of fee businesses Well-positioned • Impact on infla
Slide 21: Today's Discussion
TODAY’S DISCUSSION About Economic Our Strategic Commerce and Industry Strategic Mindset Bancshares Themes Position for Growth 21
Slide 22: Strategic Posture: Maintaining the Balance
STRATEGIC POSTURE: MAINTAINING THE BALANCE STRONG PERFORMANCE with Disciplined focus on ongoing refinement of the PRIORITY BLUE CHIP “Core Bank” investments • Super-Community Bank • Enhancing Our platform People Leadership • Relationship-based banking • High-touch customer service • Workplace Optimi
Slide 23: Consumer Banking Snapshot
CONSUMER BANKING SNAPSHOT Consumer Segment 142 BRANCHES 253 ATMs $12.5 $3.8 803 BILLION BILLION THOUSAND Consumer Consumer Consumer Deposits1 Loans1 Households2 Focus on Digital 4.7 4.6 $80,967 79% 29% Commerce Bank Digital Loan Digital Mobile App Rating3 Sales (000s) Penetration Deposit Use Period
Slide 24: Enterprise Digital Strategy: Meeting Our Customers Where They Are
ENTERPRISE DIGITAL STRATEGY: MEETING OUR CUSTOMERS WHERE THEY ARE Our Vision Why it’s Important Transform the digital experience by staying • Our current and potential customers’ current on digital trends and creating behaviors have changed, and they expect seamless digital ecosystems that place mor
Slide 25: Commercial Banking: Solutions That Matter
COMMERCIAL BANKING: SOLUTIONS THAT MATTER Commercial Segment Revenue growth opportunities Financing solutions and deposit capabilities customized for your business • Working Capital Line of Credit • Commercial Real Estate • Full Suite of Cash Management Solutions • Term Loans • ESOP Loans • Robust C
Slide 26: Industry-Leading Commercial Payments
INDUSTRY-LEADING COMMERCIAL PAYMENTS Commercial Segment CAPABILITIES Innovative payments solutions to manage payables and receivables that enhance cash flow, streamline processing and increase efficiencies Treasury Commercial Payments Merchant Management Card Revenue Volume Revenue Volume $216 $71 $
Slide 27: CommerceHealthcare: Our Specialty
Commercial Segment We don’t just serve the healthcare industry. It’s our specialty. CommerceHealthcare® Relationship Patient Receivables Engagement Management Solutions Solutions • Patient Financing • Receivables Optimization • Online Bill Pay • Reconciliation Automation • Patient Refunds • Healthca
Slide 28: Expansion Markets Offer Growth
EXPANSION MARKETS OFFER GROWTH Expansion Markets OPPORTUNITIES Expansion Market Loan Growth 1 Core Banking and $ in billions $3.5 $3.3 Expansion Market Footprint $2.9 Expansion $2.5 $2.6 Market Loan $2.3 Growth +54% since 2019 2019 2020 2021 2022 2023 2024 Expansion Market Fee Income Growth2 $ in mi
Slide 29: Wealth Segment
Wealth Segment For more than 100 years, 19th $75 $45 Commerce Trust has helped clients navigate through life events, delivering personalized Largest Among Bank-Managed BILLION BILLION service to achieve long-term Trust Total Client Assets2 Assets Under Management Companies1 financial goals through o
Slide 30: Wealth Key Growth Initiatives
Wealth Segment Wealth Key Growth Initiatives Strengthening our Wealth Brands • Utilize new private banking loan and deposit system to offer specialized products, services and automation • Continued expansion into new concentrated wealth markets through de novo and acquisition efforts • Expand our in
Slide 31: Ongoing Investment: Application Modernization
ONGOING INVESTMENT: APPLICATION MODERNIZATION Application Modernization is the focused effort to re-platform, replace, or significantly improve application platforms for the express purpose of modernizing features and capabilities, improving total cost of ownership, and/or reducing operating risk. P
Slide 32: Today's Discussion
TODAY’S DISCUSSION About Economic Our Strategic Commerce and Industry Strategic Mindset Bancshares Themes Position for Growth 32
Slide 33: 2024 Financial Performance vs. Prior Year
2024 FINANCIAL PERFORMANCE VS. PRIOR YEAR Record year for EPS and Total Revenue ROA ROE Net $526 Earnings income million per $3.87 attributable to CBI 1.72% 16.7% share 10% 12% Deposits 0% Net Dividend period end Flat 5% Interest 4% growth Income Loans 0% period end Flat Long-term outperformance
Slide 34: 2024 Year End Earnings
2024 YEAR END EARNINGS % $ in millions 2023 2024 change RETURN ON AVERAGE ASSETS Net interest income $ 998 $ 1,040 4% CASH 1.49% 1.72% DIVIDENDS Non-interest income 573 616 7% 2023 2024 $.98 Total revenue 1,571 1,656 5% 2023 Securities gains 15 8 -48% $1.03 Non-interest expense (931) (951) 2% RETURN
Slide 35: A Full-Service, Diversified Operating Model
A FULL-SERVICE, DIVERSIFIED OPERATING MODEL Card, Wealth & Deposit fees provide stable, growing revenue source Revenue Source Diversification Non-Interest Income $ in millions $616 Compared to Peers $560 $547 $573 $506 Card Income Other 37% Fee Fees & 5% Income mix vs Commissions 2% 6% peers at 21%
Slide 36: Well-Diversified Loan Portfolio
WELL-DIVERSIFIED LOAN PORTFOLIO Loan Portfolio Diversification YTD Average Loans2 $ in millions Compared to Peers1 Consumer/ Credit $17,090 HELOCs Card $16,783 $15,916 $15,686 $15,570 3% $14,243 Business Residential RE 3% Loans 23% 11% 28% 37% 2019 2020 2021 2022 2023 2024 21% COMMERCE PEERS BANK BA
Slide 37: Sound Capital and Liquidity Position
SOUND CAPITAL AND LIQUIDITY POSITION Tier 1 Risk-Based Capital Ratio1 Loan to Deposit Ratio CBSH Peer Median: 12.6% Large, stable deposit base 16.7% 68% Average PB 16.4% Core Deposits Loan to HOMB 15.1% Deposit Ratio 3 UBSI 14.1% $22.9 Commerce 83% HWC 14.1% Average Loan to CFR 14.1% Billion2 Deposi
Slide 38: Credit Performance Over Time
CREDIT PERFORMANCE OVER TIME Non-Performing Assets to Total Assets (%) 3.0% CBSH Peer Average Recession 2.5 2.0 1.5 1.0 0.5 0.0 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 Peer Banks include: ABCB, ASB, OZK, BOKF, CADE, CFR, FNB, FIBK, FULT, HWC, HO
Slide 39: Outperformance Relative to Peers Through Economic Cycles
OUTPERFORMANCE RELATIVE TO PEERS, THROUGH ECONOMIC CYCLES ROAA 25-year average Return on Average Assets CBSH: Peers: 2.0% 1.40% 1.06% 1.5 1.0 0.5 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 2020 2022 2024 CBSH Peer Median Recession Peer Banks include: ABCB, ASB, BOKF, CADE, CFR, FIBK, FNB, FUL
Slide 40: Comparisons vs. Peers YTD Dec 2024
COMPARISONS VS. PEERS YTD Dec 2024 Return on Return on Average Troubled Loans / Average Assets Common Equity Capital Total Loans Commerce 16.66% Commerce 16.71% Commerce 0.11% Commerce 1.72% 3rd highest Highest Highest 2nd lowest level return on assets return on equity capital ratio of troubled loan
Slide 41: Financial Highlights QTD: March 31, 2025
FINANCIAL HIGHLIGHTS QTD: MARCH 31, 2025 • Earnings of $.98 per share, compared to $.82 per share in the same quarter last year • PPNR1 of $190MM, an increase of $38MM over the same quarter last year Performance • ROAA of 1.69% and ROAE of 15.82% • Efficiency ratio of 55.6% 1Q 2025 earnings release
Slide 42: Liquidity and Capital Highlights
LIQUIDITY AND CAPITAL HIGHLIGHTS Liquidity Deposits • Quarterly average deposit balances decreased • $2.4B in average cash balances at Federal $84MM, or .3%, compared to Q4. Reserve Bank in Q1. • Total cost of deposits decreased 9 bps from Q4 • QTD average loan to deposit ratio of 69%. to 1.22%. • N
Slide 43: Long-Term View: Net Income and Earnings per Share
LONG-TERM VIEW: NET INCOME AND EARNINGS PER SHARE $600 Earnings Per Share Net Income $4.00 $3.50 Earnings per Share $500 Net Income $3.00 $400 $ 000s $2.50 $300 $2.00 $200 $1.50 $100 $1.00 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 Dividends $0.55 $0.58 $0.61 $0.67 $0.78 $0.85 $0.86 $0.92 $0.
Slide 44: Steady Shareholder Returns
STEADY SHAREHOLDER RETURNS as of December 31, 2024 Total Shareholder Returns Annualized Comparison Indexed, 12/31/2004 = $100 Total Shareholder Returns $600 40% CBSH 35 500 COMMERCE 30 KBW Regional KBW Bank 25 400 20 15 10 300 KBW 5 REGIONAL 0 200 1 Year 3 Year 5 Year 10 Year 20 Year KBW BANK CBSH 2
Slide 45: An "All-Weather" Operating Model
AN “ALL-WEATHER” OPERATING MODEL Revenue Diversification Deposit Franchise Balanced earnings profile, fee revenue $23.9 billion in low-cost, diverse at 37%1 of total revenue, bolstered by deposits2 with peer-leading growing wealth and national payments historical deposit betas businesses Credit Qual
Slide 46: Strategic Mindset for Growth
STRATEGIC MINDSET FOR GROWTH 46
Slide 47: Annual Shareholders' Meeting: Agenda
CBI ANNUAL SHAREHOLDERS’ MEETING: AGENDA 1 Call to Order and Welcome 2 Rules of Conduct 3 Secretary’s Report 4 Business Matters 5 Introduction of Public Accountants 6 CEO’s Presentation 7 Adjournment 47
Slide 48: Appendix: Non-GAAP Reconciliations
APPENDIX: NON-GAAP RECONCILIATIONS Pre-Tax, Pre-Provision Net Revenue For The Three Months Ended (DOLLARS IN THOUSANDS) Mar. 31, 2025 Dec. 31, 2024 Mar. 31, 2024 A Net Interest Income $ 269,102 $ 266,647 $ 248,999 B Non-Interest Income $ 158,949 $ 155,436 $ 148,848 C Non-Interest Expense $ 238,376 $
Slide 49: Strategic Mindset for Growth
STRATEGIC MINDSET FOR GROWTH 49
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