Commerce Bancshares, Inc. · NASDAQ:CBSH
Commerce Bancshares — Q1 2025 Earnings Presentation
24 slides from Commerce Bancshares's earnings presentation, Apr 16, 2025
Slide 1: Commerce Bancshares, Inc. Earnings Highlights 1st Quarter 2025
COMMERCE BANCSHARES, INC. EARNINGS HIGHLIGHTS 1st Quarter 2025
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: Commerce Bancshares: 160 Years in Business
COMMERCE BANCSHARES 160 YEARS IN BUSINESS 142 branches and 252 ATMs across 7 states CORE BANKING FOOTPRINT COMMERCIAL | CONSUMER | WEALTH MANAGEMENT St. Louis • Kansas City • Springfield Central Missouri • Central Illinois • Wichita Tulsa • Oklahoma City • Denver COMMERCIAL OFFICES Cincinnati • Nash
Slide 4: Track Record of Long-Term Outperformance
TRACK RECORD OF LONG-TERM OUTPERFORMANCE Revenue Diversification Balanced earnings profile, fee revenue at 37%1 of total revenue, bolstered by growing wealth and national payments businesses Deposit Franchise $24.5 billion in low-cost, diverse deposits2 with peer-leading historical deposit betas Cre
Slide 5: 1Q2025 Highlights
1Q2025 HIGHLIGHTS • 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 • ROAA of 1.69% and ROAE of 15.82% • Efficiency ratio of 55.6% • Net Income of $132MM in Q1, an increase of $19MM over the
Slide 6: Balance Sheet Highlights
BALANCE SHEET HIGHLIGHTS 1Q25 vs. 1Q24 1Q25 vs. 4Q24 Quarterly Average Balances % Change$ Change% Change$ Change1Q25$ in millions 1%$115.62%$178.7$11,189.4Commercial 1%47.00%-5.76,053.3Consumer 1%$162.61%$173.0$17,242.7Total Loans -2%-$187.21%$59.2$9,542.3Investment Securities1 23%$450.1-8%-$221.8$2
Slide 7: Balance Sheet: Loans and Deposits
$17.1 $17.5 $17.6 $7.3 $7.4 $7.3 1Q24 4Q24 1Q25 $24.4 $24.9 $24.9 +2% $11.1 $11.0 $11.2 $6.0 $6.1 $6.0 1Q24 4Q24 1Q25 $17.1 $17.1 $17.2 +1% BALANCE SHEET 7 Loans Consumer Loans Commercial Loans Loan Yield1 Deposits QTD Average Balances $ billions Non-Interest Bearing Interest-Bearing Deposits Intere
Slide 8: Loan Portfolio
LOAN PORTFOLIO 8 YoYQoQ3/31/202412/31/20243/31/2025$ in 000s 4.1%3.1%$5,994,974 $6,053,820$6,239,276Business -5.2%.7%1,497,6471,409,9011,419,572Construction -2.2%-.9%3,711,6023,661,2183,628,635Business Real Estate .3%-.3%3,039,8853,058,1953,047,809Personal Real Estate -.1%2.1%2,119,3082,073,1232,116
Slide 9: Commercial Real Estate Breakdown
34.5% 14.5% 14.1% 8.5% 8.2% 7.8% 5.4% 4.2% Owner- occupied Office Industrial Retail Hotels Multi-family Farm Senior living 2.8% Other Real Estate - Business Loans: Office Outstanding Balances by Geography1 % of Total Loans Real Estate - Business Loans 7.2%Owner – Occupied 3.0%Office 2.9%Industrial 1
Slide 10: Income Statement Highlights
$155 $186 $267 $236 4Q24 $422 10 INCOME STATEMENT HIGHLIGHTS $149 $152 $249 $246 1Q24 $398 $159 $190 $269 $238 1Q25 $428 Non-Interest Income (+) Net Interest Income (+) Non-Interest Expense (-) Pre-Tax, Pre-Provision Net Revenue (=) 1Q25 Comparison 24.7%vs. 1Q24 1.8%vs. 4Q24 Pre-Tax, Pre-Provision N
Slide 11: Income Statement Highlights
1Q25 vs. 1Q24 1Q25 vs. 4Q24 % Change$ Change% Change$ Change1Q25$ in millions 8%$20.11%$2.5$269.1Net Interest Income 7%$10.12%$3.5$158.9Non-Interest Income -3%-$7.31%$2.7$238.4Non-Interest Expense 25%$37.52%$3.3$189.7Pre-Tax, Pre-Provision Net Revenue1 NM-$7.3NM-$8.6-$7.6Investment Securities Losses
Slide 12: Non-Interest Income Highlights
NON-INTEREST INCOME HIGHLIGHTS 12 1Q25 vs. 1Q24 1Q25 vs. 4Q24 % Change$ Change% Change$ Change1Q25$ in millions 11%$5.50%$.2$56.6Trust Fees -3%-1.3-5%-2.245.6Bank Card Transaction Fees 10%2.54%1.126.6Deposit Account Charges and Other Fees 31%1.20%.05.1Capital Market Fees 9%.43%.24.8Consumer Brokerag
Slide 13: Non-Interest Expense Highlights
NON-INTEREST EXPENSE HIGHLIGHTS 13 1Q25 vs. 1Q24 1Q25 vs. 4Q24 % Change$ Change% Change$ Change1Q25$ in millions 1%$1.30%-$.7$153.1Salaries and Employee Benefits 3%1.1-1%-.332.2Data Processing and Software 3%.42%.314.0Net Occupancy 16%1.412%1.010.0Professional and other services 45%1.83%.25.8Marketi
Slide 14: Liquidity and Capital
LIQUIDITY AND CAPITAL & commerce Bancshares, Inc.
Slide 15: Deposit Balance Trends
2021 2022 2023 2024 $3.0 $2.8 $2.4 $2.4 DEPOSIT BALANCE TRENDS Segment view $ in billions 15 2021 2022 2023 2024 $12.0 $11.9 $10.4 $9.9 2021 2022 2023 2024 $12.8 $13.4 $12.2 $12.3 Commercial Consumer Wealth Average Balance 4Q24 1Q25 $12.5 $12.6 Period EndAverage Balance Average Balance Segment balan
Slide 16: Opportunities to Enhance and Protect Net Interest Income
3.33% 3.49% 3.56% Net Yield Hedging Structures: Four floor contracts (indexed to 1 Month SOFR) to hedge the risk of declining interest rates on floating rate commercial loans. The contracts have a term of 6 years. • 3.5% floor contract with a notional value of $500 million. The contract began 7/2024
Slide 17: Summary of Fixed & Floating Loans
Over 60% of total loans are variable; 67% of commercial loans have floating rates SUMMARY OF FIXED & FLOATING LOANS 36% 64% Business Total Loans: $6.1B Fixed Variable C om m er ci al 56% 44% Personal RE Total Loans: $3.1B C on su m er 100% 40% 60% Business RE Total Loans: $3.7B 95% 5% Consumer Card
Slide 18: High Quality, Highly Liquid and Diverse Investment Portfolio
26% 8% 47% 16% 3% Composition of AFS Portfolio Treasury & agency Municipal MBS Asset-backed Other debt HIGH QUALITY, HIGHLY LIQUID AND DIVERSE INVESTMENT PORTFOLIO 1Excludes inflation effect on TIPs; 2Tax equivalent yield Duration (yrs)Avg RateQTD – Mar. 31, 2025 3.43.67%Treasury & agency1 4.62.05%2
Slide 19: Sound Capital and Liquidity Position
91%9% Core Deposits - Non-Interest Bearing - Interest Checking - Savings and Money Market Certificates of Deposits Average Loan to Deposit Ratio3 SOUND CAPITAL AND LIQUIDITY POSITION 19 Tier 1 Risk-Based Capital Ratio1 1S&P Global Market Intelligence, Information as of December 31, 2024 2Period-end
Slide 20: Maintaining Strong Credit Quality
$5.8 $18.3 $22.6 $130.7 $145.3 1Q24 4Q24 1Q25 $8.9 $10.7 $10.8$9.2 $15.8 1Q24 4Q24 1Q25 MAINTAINING STRONG CREDIT QUALITY Net Loan Charge-Offs (NCOs) $ in millions NCOs- CBSH NCOs - Peer Average NCO/Average Loans1 - CBSH $160.5 $162.7 $167.0 $315.8 $335.6 1Q24 4Q24 1Q25 Allowance for Credit Losses o
Slide 21: Allocation of Allowance
ALLOCATION OF ALLOWANCE 21 CECL allowances reflect the economic and market outlook March 31, 2025December 31, 2024 % of Outstanding Loans Allowance for Credit Losses (ACL) % of Outstanding Loans Allowance for Credit Losses (ACL)$ in millions .73%$ 45.7.72%$ 43.8Business .87%31.7 .90%32.8 Bus R/E 2.0
Slide 22: Capital for Business: Quick Facts
Quick Facts: Small Business Investment Company (SBIC) founded in 1959 Nationwide footprint with Greater Midwest Focus 33 Portfolio Companies Representing $966.1 million in Revenue Over 3,000 Employees Fair Value as of March 31, 2025: $175.6 million Investment Criteria • Manufacturing, distribution a
Slide 23: Non-GAAP Reconciliations
NON-GAAP RECONCILIATIONS 23 For The Three Months Ended Mar. 31, 2024Dec. 31, 2024Mar. 31, 2025(DOLLARS IN THOUSANDS) 248,999$266,647$269,102$Net Interest IncomeA 148,848$155,436$158,949$Non-Interest IncomeB 245,697$235,718$238,376$Non-Interest ExpenseC 152,150$186,365$189,675$Pre-Provision Net Reven
Slide 24: Contact Information
Contact Information: Matt Burkemper Senior Vice President, Commerce Bank Corporate Development and Investor Relations 314.746.7485 Matthew.Burkemper@commercebank.com Commerce Bancshares, Inc. Investor Relations website: http://investor.commercebank.com/