Commerce Bancshares, Inc. · NASDAQ:CBSH
Commerce Bancshares — Q4 2020 Earnings Presentation
14 slides from Commerce Bancshares's earnings presentation, January 2021
Slide 1: Commerce Bancshares, Inc. Earnings Highlights 4th Quarter 2020
COMMERCE BANCSHARES, INC. EARNINGS HIGHLIGHTS 4th Quarter 2020
Slide 2: 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 3: 4Q2020 Earnings Highlights
4Q2020 EARNINGS HIGHLIGHTS Highlights Well-positioned in a challenging environment PPNR1 • Allowance for credit losses on loans to total loans decreased to 1.35% $148.6 million – Decreased to 1.48% excluding Paycheck Protection Program (“PPP”) loans. Allowance for Credit • Net charge-offs to total l
Slide 4: Balance Sheet Highlights
BALANCE SHEET HIGHLIGHTS Average Balances Change vs. $ in millions 4Q20 3Q20 4Q19 Highlights • Linked quarter reflects lower business loans offset by higher construction and business real estate Commercial1 $10,643.0 $(30.2) $1,559.4 • YoY reflects PPP • Linked quarter reflects higher personal real
Slide 5: Balance Sheet
BALANCE SHEET Loans Deposits QTD Average Balances QTD Average Balances $ billions $ billions +27% $24.7 $25.6 +13% $20.2 $16.3 $16.3 $9.8 $10.3 $14.5 $6.6 $5.7 $5.7 $5.4 4.47% 3.69% 3.69% $15.3 $13.6 $14.9 $9.1 $10.6 $10.6 0.52% 0.18% 0.12% 4Q19 3Q20 4Q20 4Q19 3Q20 4Q20 Consumer Loans Loan Yield Non
Slide 6: Income Statement Highlights
INCOME STATEMENT HIGHLIGHTS Change vs. $ in millions 4Q20 3Q20 4Q19 Highlights • Linked quarter (LQ) decline due to lower Net Interest Income $209.8 $(6.2) $7.1 earning asset yields partially offset by lower deposit costs and larger balance sheet. • LQ increase in bank card, trust fees and mortgage
Slide 7: Pre-Tax, Pre-Provision Net Revenue (PPNR)
PRE-TAX, PRE-PROVISION NET REVENUE (PPNR) Net Interest Income (+) Non-Interest Expense (-) Non-Interest Income (+) Pre-Tax, Pre-Provision Net Revenue (=) $346 $346 $345 4Q2020 Comparison $203 $195 $191 $196 $216 $210 vs. 4Q2019 -1.6% vs. 3Q2020 -3.9% $151 $155 $149 $143 $135 $130 4Q2019 3Q2020 4Q202
Slide 8: Sound Capital and Liquidity Position
SOUND CAPITAL AND LIQUIDITY POSITION Total Risk-Based Capital Ratio1 Loan to Deposit Ratio Peer Median: 14.1% Large, stable deposit base and low SFNC 15.8% OZK 15.3% loan to deposit ratio UBSI 64% 15.1% Core Deposits Average Loan to UMPQ 15.0% Deposit Ratio3 CFR CBSH 14.7% $25.1 Commerce 90% 14.6% A
Slide 9: Maintaining Strong Credit Quality
MAINTAINING STRONG CREDIT QUALITY Net Loan Charge-Offs (NCOs) Allowance for Credit $ in millions Losses on Loans (ACL) $15.2 $ in millions $301.8 $10.4 $236.4 $220.8 $8.3 $7.6 $8.0 $160.7 $143.0 1.44% 1.42% 1.35% .42% 1.09% .73% .18% .18% .18% .19% 4Q19 3Q20 4Q20 4Q19 3Q20 4Q20 NCOs- CBSH NCO/Averag
Slide 10: Impact of CECL: Allocation of Allowance
IMPACT OF CECL: ALLOCATION OF ALLOWANCE CECL allowances reflect the economic and market outlook due to COVID-19 December 31, 2019 September 30, 2020 December 31, 2020 Incurred Model CECL Model CECL Model Methodology and Allowance Allowance Allowance % of for Credit % of for Credit % of Variables for
Slide 11: Providing Relief to Our Customers
PROVIDING RELIEF TO OUR CUSTOMERS Active deferral exposure reduced as pandemic continues Payment Relief Requests Active deferrals1 Active deferrals1 as of September 30, 2020 as of December 31, 2020 Number Total Number Total % of Portfolio % of Portfolio Loan Type of Amount of of Amount of (by $ amou
Slide 12: Loan Portfolio: Limited Exposure to Pandemic-Sensitive Industries
LOAN PORTFOLIO: LIMITED EXPOSURE TO PANDEMIC-SENSITIVE INDUSTRIES While we expect nearly every industry to be impacted to some degree by Coronavirus-related disruptions, we have identified eight industries that will be most impacted. % of Loan Portfolio $ in $ in Loan Outstandings Highest Impacted m
Slide 13: Non-GAAP Reconciliations
NON-GAAP RECONCILIATIONS Pre-tax, Pre-provision Net Revenue For The Three Months Ended (DOLLARS IN THOUSANDS) Dec. 31, 2020 Sept. 30, 2020 Dec. 31, 2019 A Net Interest Income $ 209,763 $ 215,962 $ 202,659 B Non-Interest Income $ 135,117 $ 129,572 $ 143,461 C Non-Interest Expense $ 196,310 $ 190,858
Slide 14: Commerce Bancshares, Inc.
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