COMMERCE BANCSHARES INC /MO/ (CBSH)·Q4 2024 Earnings Summary

Executive Summary

• EPS of $1.01 was flat sequentially and up vs prior year ($0.79), with total revenue up 7.3% YoY; net interest margin slipped 1 bp to 3.49% while efficiency improved to 55.8% .
• Deposit costs fell (avg rate 1.87%) and average deposits rose 2.4% QoQ, supporting net interest income growth (+$4.3M QoQ to $266.6M) despite lower variable loan yields .
• Non-interest income remained a diversified 36.8% of revenue, led by trust fees up 14.6% YoY; credit quality stayed strong (NCO ratio 0.25%, non-accrual loans 0.11% of total) .
• AOCI/unrealized losses on AFS securities increased in Q4 (+$204.2M), and book value per share decreased 3% QoQ to $24.84, partially offset by tangible common equity of 9.92% and robust liquidity .
• Consensus estimates via S&P Global were unavailable due to data access limits; beat/miss vs Street cannot be assessed this quarter (see Estimates Context) [SPGI access error].

What Went Well and What Went Wrong

What Went Well

• Deposit costs declined and average deposits rose, lifting net interest income; “repricing of fixed-rate earning assets, coupled with lower deposit costs, largely offset lower variable rate loan yields” (CEO) .
• Trust fees strength: +14.6% YoY with private client momentum; non-interest income represented 36.8% of revenue, underscoring diversified fee franchise .
• Credit quality remained excellent: non-accrual loans 0.11% of loans, ACL/loans 0.95%, and NCOs manageable at 0.25% .

What Went Wrong

• Non-interest income decreased $3.6M QoQ and net securities gains fell vs Q3; AFS portfolio unrealized losses rose $204.2M in Q4 .
• Provision for credit losses increased QoQ (+$4.4M), with consumer card and consumer loan NCOs up modestly .
• Book value per share fell 3% QoQ to $24.84 amid AOCI loss growth; TCE/TA decreased 55 bps sequentially to 9.92% .

Financial Results

Core P&L and Margins – Trend (oldest → newest)

Year-over-Year Snapshot (oldest → newest)

Non-Interest Income Breakdown – Trend (oldest → newest)

KPIs & Balance/Liquidity – Trend (oldest → newest)

Guidance Changes

Note: Company does not provide formal revenue/EPS range guidance; disclosures focus on funding cost trajectory, investment portfolio cash flows, and hedge structures .

Earnings Call Themes & Trends

Management Commentary

• “Our fourth quarter earnings were strong, reflecting our resilient balance sheet, diversified operating model, and well-controlled expenses.” – John Kemper, President & CEO .
• “Net interest margin declined only one basis point to 3.49%…repricing of our fixed-rate earning assets, coupled with lower deposit costs, largely offset lower variable rate loan yields.” – John Kemper .
• “Total non-interest income was 36.8% of total revenue. Trust fees were strong…up 14.6% over the same period last year.” – John Kemper .
• “We continue to maintain ample levels of liquidity and capital…Book value per share increased 14.5% compared to the same period last year…TCE/TA 9.92%.” – John Kemper .

Q&A Highlights

• The full earnings call transcript was not available through our document tools or the company’s investor site; Q&A themes cannot be corroborated this quarter [ListDocuments showed no transcript; investor site links do not include transcripts].

Estimates Context

• S&P Global consensus for Q4 2024 EPS and revenue was unavailable due to SPGI request limits at retrieval time; therefore, we cannot assess beat/miss versus Street or quantify estimate gaps this quarter. Values from alternative sources were not used to preserve methodology integrity (S&P Global is our default for consensus).
• Implications: With deposit costs falling faster than variable loan yields, and trust fees accelerating, we expect directional Street models to reflect modestly higher NII and fee run-rate assumptions; however, higher provision and AFS unrealized losses may temper forecasted book value trajectory and capital metrics .

Key Takeaways for Investors

• Funding cost relief and deposit growth supported NII despite NIM headwinds; watch pace of deposit repricing vs variable-rate loan resets in 1H25 for earnings durability .
• Fee diversification is a structural positive (trust, card, deposit services), with trust fees strength offsetting cyclical card dynamics; fee mix ~36–38% of revenue provides resilience through rate cycles .
• Credit quality remains a differentiator (low non-accruals; manageable NCOs); monitor consumer card and consumer loan NCOs, which ticked up sequentially .
• Balance sheet actions: higher reinvest yields on AFS and expected ~$1.6B portfolio cash flows in next 12 months give levers to protect NII; SOFR floors add rate downside protection .
• Capital and liquidity are strong, but AOCI volatility impacted book value; TCE/TA remains healthy at 9.92%; buybacks continued ($46MM in Q4) .
• Dividend commitment sustained (cash dividend $0.27 and 5% stock dividend executed); supports total return while maintaining balance sheet flexibility .
• Near-term trading: Positive bias toward spread income resilience and fee strength; monitor macro rate path, provision trajectory, and AOCI trends as potential stock catalysts .

Appendix: Additional Data and Disclosures

• Other relevant press releases: Declared stock dividend (5%) and $0.27 quarterly cash dividend on 10/25/2024; dividends executed in Q4 .
• Q2/Q3 prior quarters context used for trend analysis from company 8-Ks and releases .

Citations: Company press releases and 8-K exhibits: Q4 2024 ; Q4 2024 8-K and slides ; Q3 2024 ; Q2 2024 .