Charles Kim

About Charles Kim

Charles G. Kim, 64, is Executive Vice President and Chief Financial Officer of Commerce Bancshares, Inc. (CBSH), serving as CFO since July 2009; he has been Executive Vice President of the Company since April 1995 and Executive Vice President of Commerce Bank since January 2004 (previously Senior Vice President of Commerce Bank) . CBSH’s incentive design for 2024 tied NEO pay to Net Income, Pre-provision Net Revenue (PPNR), Revenue, and ROE vs peers, with CFO bonuses weighted 80% by company performance and 20% by individual performance . Company performance context: in 2024, CBSH reported Net Income of $534.4 million, Actual Revenue of $1,663.6 million, and a TSR value of $128 on a $100 initial investment; Say-on-Pay support for 2024 compensation was 91% .

Past Roles

External Roles

No external public company board roles for Kim were disclosed in the reviewed filings (DEF 14A 2025; 10-K FY2024) .

Fixed Compensation

Performance Compensation

Annual Cash Incentive (EICP) – 2024 design and outcome

• Structure: Metrics were Net Income, PPNR, Revenue (budget-based targets), and ROE vs a 19-bank peer set (target top quartile). EICP funding range: 0–164% of target. CFO bonus determined 80% by Company Performance Factor, 20% by individual performance .
• Target and payout: Kim’s 2024 target bonus was $466,868; actual earned was $705,904 .

2024 Equity Awards and Elections

• Election mix: All NEOs except the CEO elected 100% restricted stock (RSAs) for the 2024 annual grant; Kim received no 2024 SARs .
• Grant detail: On 1/31/2024, Kim received 10,263 RSAs with aggregate grant date fair value of $509,436 .
• Vesting: Current Year Restricted Stock vests 100% at 4 years; vesting conditioned on cumulative positive net income; SARs (when granted) vest 25% annually over 4 years; awards accelerate upon a change of control .

Outstanding Equity and 2024 Realizations

• Unvested restricted stock at 12/31/2024: 35,682 shares; vesting schedule below .
• SARs/options holdings and terms: 10-year life; vest 25% per year; Kim holds multiple grants with strikes from $38.26 to $60.10 (details below) .
• 2024 exercises/vesting: Options exercised 9,878 shares ($611,528 value); stock vested 12,225 shares ($606,918 value) .

Equity Ownership & Alignment

• Beneficial ownership: 155,066 shares; less than 1% of class; includes 11,270 shares acquirable via SARs within 60 days .
• Ownership guidelines: Executive Vice President requirement = 2x base salary; as of Dec 31, 2024, each NEO exceeded required ownership levels .
• Policies: Company prohibits hedging and option repricing; anti-hedging policy is embedded in award agreements .

Employment Terms

• Severance framework: No employment agreement; change-in-control severance agreements provide benefits only upon both a change of control and a qualifying termination (double trigger) . Lump sum cash = 3× (prior-year base + average bonus over 3 years) plus the greater of prior-year actual bonus or current-year target; continuation of medical/life/disability for up to 3 years or to age 65; outplacement; ability to borrow to exercise options; excise tax gross-up applies to NEOs other than the CEO (if applicable) .
• Clawback: Recoupment policy (Oct 2023) requires recovery of incentive-based compensation upon a material restatement, regardless of misconduct .
• Equity vesting on termination: Pro-rata vesting of RS upon death/disability (immediate) and upon retirement (deferred to end of restriction period, subject to performance condition); all RS and SARs/options vest upon change of control; “retirement” defined as age ≥60 with ≥10 years of service; signing a non-compete is a condition to restricted stock grants .
• Early retirement eligibility: Kim is currently eligible for early retirement under the qualified Retirement Plan (age ≥55 and ≥10 years); estimated annual accrued plan benefit at 65: $38,721; present value of accumulated qualified pension benefit: $462,080 .
• Nonqualified retirement: CERP Post‑2004 balance at 12/31/2024: $965,684; 2024 Company credit: $41,829; 2024 earnings: $43,993 .
• Potential payout illustration (12/31/2024 assumption): Qualified termination after change of control total = $5,289,624 for Kim, including salary $1,118,611; bonus $466,868; SARs/options $16,686; restricted stock $2,223,345; EICP/CERP $965,684; retirement plan $462,080; post‑termination insurance $36,350 .

Investment Implications

• Pay-for-performance alignment: CFO’s 2024 bonus target (80% of salary) was anchored to Net Income, PPNR, Revenue, and ROE vs peers; actual payout ($705,904) exceeded target ($466,868), consistent with the plan’s funding mechanics and Company-level results emphasized for the CFO .
• Near-term selling pressure: Kim realized option exercise proceeds in 2024 ($611,528) and has sizable RS vesting tranches in 2025–2029 (e.g., 7,107 shares in early 2025), creating identifiable windows where liquidity events could occur .
• Alignment and retention: Beneficial ownership of 155,066 shares and compliance with stock ownership guidelines indicate meaningful alignment; however, Kim is eligible for early retirement and holds change-in-control protections with double-trigger benefits, which can factor into retention dynamics during strategic events .
• Governance and risk controls: The company maintains an updated clawback (restatement-based) and anti-hedging policy; no repricing of underwater options; Say-on-Pay support was 91%, signaling broad shareholder acceptance of the program design .
• Economics under CoC: Potential payments of $5.29 million under a qualified termination after a change of control (with accelerated equity) are material and include excise tax gross-up eligibility for NEOs other than the CEO, a provision some investors scrutinize .