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KANSAS CITY - On Thursday, Commerce Bancshares, Inc. (NASDAQ:CBSH) reported third quarter earnings of $1.06 per share, falling short of analyst expectations of $1.10, while revenue came in at $440.97 million, below the consensus estimate of $447.84 million.
Despite the miss, the company’s shares edged up 0.25% in pre-market trading following the announcement.
Net income for the quarter reached $141.5 million, up from $138.0 million in the same period last year but down from $152.5 million in the second quarter of 2025. The sequential decline was primarily due to higher credit loss provisions and lower non-interest income, partially offset by investment securities gains.
Revenue increased 4.6% YoY but decreased 1.1% from the previous quarter. Net interest income was $279.5 million, down slightly from the previous quarter, with net yield on interest-earning assets decreasing six basis points to 3.64%. Non-interest income totaled $161.5 million, representing 36.6% of total revenue.
"Commerce delivered another strong quarter, underscoring the resilience of our diversified operating model and the dedication of our talented team," said John Kemper, Chief Executive Officer. "Our third quarter results reflect steady loan balances, robust fee income, and disciplined expense management, all of which contributed to another period of high profitability."
The company maintained solid profitability metrics with a return on average assets of 1.78% and return on average equity of 15.26%. Average loan balances remained flat at $17.5 billion compared to the previous quarter, while average deposits decreased by $140.1 million to $24.8 billion.
Credit quality metrics showed some deterioration, with the allowance for credit losses on loans increasing to $175.7 million, or 0.99% of total loans, up from 0.94% in the previous quarter. The ratio of annualized net loan charge-offs to average loans was 0.23%, slightly higher than 0.22% in the prior quarter.
Commerce Bancshares expects to close its acquisition of FineMark Holdings on January 1, 2026, which will expand its presence in Florida, Arizona, and South Carolina.
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