KANSAS CITY, Mo. - Commerce Bancshares, Inc. (NASDAQ:CBSH) reported a notable increase in earnings and revenue for the second quarter of 2024, surpassing analyst expectations.
The company announced earnings of $1.07 per share, which was $0.13 higher than the analyst estimate of $0.94. Revenue for the quarter was also strong, coming in at $414.49 million, exceeding the consensus estimate of $403.85 million.
The bank's earnings represent an improvement from the $0.97 per share reported in the same quarter last year and a significant jump from the $0.86 per share in the first quarter of 2024. Net income for the second quarter reached $139.6 million, up from $127.8 million in the second quarter of 2023, and from $112.7 million in the previous quarter.
President and Chief Executive Officer, John Kemper (NYSE:KMPR), attributed the robust quarterly performance to an expanding net interest margin, solid fee income, and well-controlled expenses. The bank's net interest margin expanded by 22 basis points this quarter, thanks in part to a strategic repositioning of some available for sale securities, asset repricing benefits, and inflation income on treasury bonds. Trust fees and deposit account fees also saw increases of 10.6% and 11.9%, respectively, compared to the same period last year.
Commerce Bancshares maintained strong capital and liquidity levels, with credit quality across its loan portfolio remaining excellent. Non-accrual loans were just 11 basis points of total loans. Additionally, the bank made a significant community investment by contributing $5.0 million to the Commerce Bancshares Foundation during the quarter.
Looking at the balance sheet, average loan balances saw a modest increase of 0.6% compared to the prior quarter, totaling $17.2 billion. Total average available for sale debt securities decreased by $695.1 million from the prior quarter to $8.8 billion at fair value.
The bank's return on average assets was 1.86%, and the return on average equity was 18.52% for the quarter, with an efficiency ratio of 55.9%. These figures reflect the bank's effective management of assets and equity to generate profits.
Commerce Bancshares, Inc. is a regional bank holding company that provides a full range of banking services through its subsidiaries. With a history spanning nearly 160 years, the bank operates full-service banking facilities across the Midwest and maintains commercial offices in several states, offering high-touch service and sophisticated financial solutions.
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