Commerce Bancshares Inc.

05/07/2026 | Press release | Distributed by Public on 05/07/2026 13:31

Quarterly Report for Quarter Ending March 31, 2026 (Form 10-Q)

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
The following discussion and analysis should be read in conjunction with the consolidated financial statements and related notes and with the statistical information and financial data appearing in this report as well as the Company's 2025 Annual Report on Form 10-K. Results of operations for the three months ended March 31, 2026 are not necessarily indicative of results to be attained for any other period.
Acquisition
On January 1, 2026, the Company completed its previously announced acquisition of FineMark Holdings, Inc. ("FineMark"), a bank holding company headquartered in Fort Myers, Florida, pursuant to the Agreement and Plan of Merger dated June 16, 2025. Immediately after the merger, FineMark's wholly-owned subsidiary, FineMark National Bank & Trust, merged into the Bank, with the Bank continuing as the surviving bank. The acquisition added total assets of approximately $3.9 billion, including loans of $2.7 billion, total deposits of $3.1 billion, and assets under administration of $8.7 billion, as well as 13 banking offices in Florida, Arizona and South Carolina.
Visa Class B-2 common shares exchange offer
On April 13, 2026, Visa, Inc. ("Visa") announced the commencement of a public offering to exchange Class B-2 common stock for a combination of shares of Class B-3 common stock and Class C common stock ("2026 Exchange Offer"). The Company tendered all of its Visa Class B-2 shares and is awaiting notification of acceptance of that tender and the closing of the 2026 Exchange Offer. If the Company's tendered shares are accepted and the exchange occurs in the second quarter of 2026, the Company expects to record a significant gain during the second quarter of 2026 based on the conversion privilege of the Class C common stock and the closing price of Visa Class A common stock. A full description of the terms of the 2026 Exchange Offer is set forth in Visa's related Issuer Tender Offer Statement on Schedule TO and Prospectus, each dated April 6, 2026, publicly filed with the U. S. Securities and Exchange Commission.
As described in Note 4 "Investment Securities," the Company previously entered into a Makewhole Agreement with Visa related to its participation in the 2024 Exchange Offer. In order to continue preserving the economic benefit of those same adjustments for Visa's Class A and Class C common stockholders in relation to the Class B-2 and Class B-3 conversion ratios following the 2026 Exchange Offer, and as a condition of participating in the 2026 Exchange Offer, the Company entered into a Makewhole Agreement (2026 Makewhole Agreement) with Visa that provides for similar cash payments to Visa under the same circumstances as described above for the 2024 Makewhole Agreement. As further described in Visa's related Issuer Tender Offer Statement on Schedule TO and Prospectus, each dated April 13, 2026, publicly filed with the U. S. Securities and Exchange Commission, both the 2026 Makewhole Agreement and the related escrow fund and transfer restrictions on Visa's Class B-2 common stock and the new Class B-3 common stock will terminate whenever the covered litigation is ultimately resolved, at which future date outstanding shares of Visa Class B-3 common stock will be convertible into shares of its Class A common stock at the then-applicable conversion ratio. The 2026 Makewhole Agreement also includes limited transfer restrictions, such that the Company may only transfer up to one-third of the shares of Visa Class C common stock received in the exchange within the first 45 days following the 2026 Exchange Offer acceptance date, and may only transfer up to two-thirds of the Class C common stock received within the first 90 days following the 2026 Exchange Offer acceptance date.
Additionally, if the Company's tendered shares are accepted and the exchange occurs in the second quarter of 2026, the Company may consider a plan to reposition a portion of its available for sale debt securities portfolio through the sale of securities, which may result in a significant loss during the second quarter of 2026. The timing and amount of the loss ultimately realized on the available for sale debt securities and the reinvestment assumptions may depend on many considerations, including market conditions, the amount of the gain recognized on the conversion privilege of the Visa shares, and other factors.
Forward-Looking Information
This report may contain "forward-looking statements" that are subject to risks and uncertainties and include information about possible or assumed future results of operations. Many possible events or factors could affect the future financial results and performance of the Company. This could cause results or performance to differ materially from those expressed in the forward-looking statements. Words such as "expects", "anticipates", "believes", "estimates", variations of such words and other similar expressions are intended to identify such forward-looking statements. These statements are not guarantees of future performance and involve certain risks, uncertainties and assumptions that are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in, or implied by, such forward-looking statements. Readers should not rely solely on the forward-looking statements and should consider all uncertainties and risks discussed
throughout this report. Forward-looking statements speak only as of the date they are made. The Company does not undertake to update forward-looking statements to reflect circumstances or events that occur after the date the forward-looking statements are made or to reflect the occurrence of unanticipated events. Such possible events or factors include: changes in economic conditions in the Company's market area; changes in policies by regulatory agencies; governmental legislation and regulation; fluctuations in interest rates; changes in liquidity requirements; demand for loans in the Company's market area; changes in accounting and tax principle;, estimates made on income taxes; competition with other entities that offer financial services; cybersecurity threats; risks related to the merger with FineMark including, among others, (i) the Company's ability to promptly and effectively integrate the merger, (ii) diversion of management's attention from ongoing business operations and opportunities, (iii) cost savings and any revenue synergies from the merger may not be fully realized or may take longer than anticipated to be realized, (iv) deposits attrition, customer or employee loss and/or revenue loss as a result of the merger, and (v) expenses related to the merger being greater than expected; and such other factors as discussed in Part I Item 1A - "Risk Factors" and Part II Item 7 - "Management's Discussion and Analysis of Financial Condition and Results of Operations" in the Company's 2025 Annual Report on Form 10-K and Part II, Item 1A. - "Risk Factors" in this report.
Critical Accounting Estimates and Related Policies
The Company has identified certain policies as being critical because they require management to make particularly difficult, subjective and/or complex judgments about matters that are inherently uncertain and because of the likelihood that materially different amounts would be reported under different conditions or using different assumptions. These estimates and related policies are the Company's allowance for credit losses and fair value measurement policies. A discussion of these estimates and related policies can be found in the sections captioned "Critical Accounting Policies" and "Allowance for Credit Losses on Loans and Liability for Unfunded Lending Commitments" in Management's Discussion and Analysis of Financial Condition and Results of Operations included in the Company's 2025 Annual Report on Form 10-K. There have been no changes in the Company's application of critical accounting policies since December 31, 2025.
Selected Financial Data
Three Months Ended March 31
2026 2025
Per Share Data
Net income per common share - basic $ .96 $ .93 *
Net income per common share - diluted .96 .93 *
Cash dividends on common stock .275 .262 *
Book value per common share 29.64 24.94 *
Market price 49.20 59.27 *
Selected Ratios
(Based on average balance sheets)
Loans to deposits (1)
73.44 % 69.38 %
Non-interest bearing deposits to total deposits 28.43 29.36
Equity to loans (1)
21.37 19.56
Equity to deposits 15.69 13.57
Equity to total assets 12.29 10.71
Return on total assets 1.62 1.69
Return on equity 13.22 15.82
(Based on end-of-period data)
Non-interest income to revenue (2)
36.97 37.13
Efficiency ratio (3)
60.00 55.61
Tier I common risk-based capital ratio 17.09 16.86
Tier I risk-based capital ratio
17.09 16.86
Total risk-based capital ratio 17.90 17.65
Tangible common equity to tangible assets ratio (4)
11.07 10.33
Tier I leverage ratio
12.60 12.29
* Restated for the 5% stock dividend distributed in December 2025.
(1) Includes loans held for sale.
(2) Revenue includes net interest income and non-interest income.
(3) The efficiency ratio is calculated as non-interest expense (excluding intangibles amortization) as a percent of revenue.
(4) The tangible common equity to tangible assets ratio is a measurement which management believes is a useful indicator of capital adequacy and utilization.
It provides a meaningful basis for period to period and company to company comparisons, and also assists regulators, investors and analysts in analyzing the financial position of the Company. Tangible common equity and tangible assets are non-GAAP measures and should not be viewed as substitutes for, or superior to, data prepared in accordance with GAAP.
The following table is a reconciliation of the GAAP financial measures of total equity and total assets to the non-GAAP measures of total tangible common equity and total tangible assets.
March 31
(Dollars in thousands) 2026 2025
Total equity $ 4,326,398 $ 3,498,402
Less non-controlling interest 24,629 20,615
Less goodwill 253,805 146,539
Less intangible assets* 136,404 3,825
Total tangible common equity (a) $ 3,911,560 $ 3,327,423
Total assets $ 35,717,256 $ 32,364,964
Less goodwill 253,805 146,539
Less intangible assets* 136,404 3,825
Total tangible assets (b) $ 35,327,047 $ 32,214,600
Tangible common equity to tangible assets ratio (a)/(b) 11.07 % 10.33 %
* Intangible assets other than mortgage servicing rights.
Results of Operations
Summary
Three Months Ended March 31 Increase (Decrease)
(Dollars in thousands) 2026 2025 Amount % change
Net interest income (expense) $ 299,840 $ 269,102 $ 30,738 11.4 %
Provision for credit losses (10,960) (14,487) (3,527) (24.3)
Non-interest income 175,851 158,949 16,902 10.6
Investment securities gains (losses), net 11,647 (7,591) 19,238 N.M.
Non-interest expense (291,126) (238,376) 52,750 22.1
Income taxes (40,881) (36,964) 3,917 10.6
Non-controlling interest income (expense) (2,748) 959 3,707 N.M.
Net income attributable to Commerce Bancshares, Inc. $ 141,623 $ 131,592 10,031 7.6
N.M. - Not meaningful.
For the quarter ended March 31, 2026, net income attributable to Commerce Bancshares, Inc. (net income) amounted to $141.6 million, an increase of $10.0 million, or 7.6%, compared to the first quarter of the previous year. For the current quarter, the annualized return on average assets was 1.62%, the annualized return on average equity was 13.22%, and the efficiency ratio was 60.00%. Diluted earnings per common share was $.96 per share in the current quarter, an increase of 3.2% compared to $.93 per share in the first quarter of 2025, and decreased 5.0% compared to $1.01 per share in the previous quarter.
Compared to the first quarter of last year, net interest income increased $30.7 million, or 11.4%, mainly due to increases in interest income on loans and securities purchased under agreements to resell ("resale agreements") of $34.2 million and $1.0 million, respectively, partly offset by a decrease in interest income on investment securities of $4.2 million. Interest expense on deposits increased $4.1 million, while interest expense on borrowings decreased $2.7 million. The provision for credit losses decreased $3.5 million compared to the same quarter in the prior year. Non-interest income increased $16.9 million, or 10.6%, compared to the first quarter of 2025, mainly due to increases in trust fees, deposit account fees and brokerage fees of $14.5 million, $2.0 million and $659 thousand, respectively. Net gains on investment securities totaled $11.6 million in the current quarter compared to net losses of $7.6 million in the same quarter of last year. Securities gains in the current quarter primarily resulted from net gains in fair value of $10.9 million recorded on private equity investments. Non-interest expense increased $52.8 million, or 22.1%, over the first quarter of 2025, mainly due to higher salaries and benefits expense of $27.7 million, primarily a result of onboarding FineMark team members and acquisition-related compensation payments. Professional and other services expense increased $8.8 million, which included $4.7 million in acquisition-related legal and professional services expense. Other non-interest expense increased $6.4 million, primarily due an increase of $5.4 million in intangible amortization expense related to the FineMark acquisition. Data processing expense expense increased $5.1 million compared to the same quarter of last year.
Net Interest Income
The following table summarizes the changes in net interest income on a fully taxable-equivalent basis, by major category of interest earning assets and interest bearing liabilities, identifying changes related to volumes and rates. Changes not solely due to volume or rate are allocated to rate.
Analysis of Changes in Net Interest Income
Three Months Ended March 31, 2026 vs. 2025
Change due to

(In thousands) 		Average
Volume 		Average
Rate
Total
Interest income, fully taxable-equivalent basis:
Loans:
Business $ 8,549 $ (5,988) $ 2,561
Real estate - construction and land 3,186 (2,784) 402
Real estate - business 5,478 (1,310) 4,168
Real estate - personal 14,471 5,923 20,394
Consumer 5,453 (1,872) 3,581
Revolving home equity 4,519 37 4,556
Consumer credit card (161) (1,173) (1,334)
Overdrafts - - -
Total interest on loans 41,495 (7,167) 34,328
Loans held for sale 12 (6) 6
Investment securities:
U.S. government and federal agency obligations 6,090 (3,799) 2,291
Government-sponsored enterprise obligations (3) (1) (4)
State and municipal obligations (480) 83 (397)
Mortgage-backed securities (2,959) 354 (2,605)
Asset-backed securities (3,878) 1,020 (2,858)
Other securities 390 (1,070) (680)
Total interest on investment securities (840) (3,413) (4,253)
Federal funds sold (17) (5) (22)
Securities purchased under agreements to resell 574 463 1,037
Interest earning deposits with banks 6,696 (5,600) 1,096
Total interest income 47,920 (15,728) 32,192
Interest expense:
Deposits:
Savings 1 46 47
Interest checking and money market 8,951 (2,844) 6,107
Certificates of deposit of less than $100,000 602 (1,451) (849)
Certificates of deposit of $100,000 and over 1,204 (2,425) (1,221)
Total interest on deposits 10,758 (6,674) 4,084
Federal funds purchased 146 (250) (104)
Securities sold under agreements to repurchase (344) (3,100) (3,444)
Other borrowings 870 (2) 868
Total interest expense 11,430 $ (10,026) $ 1,404
Net interest income, fully taxable-equivalent basis $ 36,490 $ (5,702) $ 30,788
Net interest income in the first quarter of 2026 was $299.8 million, an increase of $30.7 million over the first quarter of 2025. On a fully taxable-equivalent (FTE) basis, net interest income totaled $302.2 million in the first quarter of 2026, up $30.8 million over the same period last year and up $16.4 million over the previous quarter. The increase in net interest income
compared to the first quarter of 2025 was mainly due to an increase in average loan balances in connection with the acquisition of FineMark on January 1, 2026. Accretion income on FineMark's loans resulting from purchase accounting adjustments totaled $6.9 million. Interest income earned on loans (FTE) increased over the same period in the prior year mainly due to higher average loan balances, partly offset by lower average rates earned. The decrease in total interest earned on investment securities (FTE) was mainly the result of lower average rates earned on U.S. government and federal agency obligations and lower average balances of asset-backed and mortgage-backed securities. The increase in deposit interest expense was mainly due to higher average balances, partly offset by lower average rates paid. Interest expense on securities sold under agreements to repurchase decreased mainly due to lower average rates paid. The Company's net yield on earning assets (FTE) was 3.59% in the current quarter compared to 3.56% in the first quarter of 2025.
Total interest income (FTE) increased $32.2 million over the first quarter of 2025. Interest income on loans (FTE) was $290.3 million during the first quarter of 2026, an increase of $34.3 million, or 13.4%, over the same quarter last year. The increase in loan interest income over the same quarter of last year was primarily due to growth of $3.1 billion, or 18.0%, in average loan balances and higher average rates earned on personal real estate loans. Most of the increase in interest income was due to the acquisition of FineMark, which added $2.7 billion in loan balances. The largest increase to interest income occurred in personal real estate loan interest, which grew $20.4 million due to a $1.4 billion, or 45.0%, increase in average balances coupled with a 54 basis point increase in the average rate earned. Revolving home equity loan interest income increased $4.6 million mainly due to a $252.4 million, or 70.4%, increase in average balances. Business real estate loan interest income increased $4.2 million due to higher average balances of $377.8 million, or 10.3%, partly offset by a decrease of 13 basis points in the average rate earned. The $3.6 million increase in consumer loan interest income was due to a $339.2 million, or 16.3%, increase in average balances, partly offset by a decline of 32 basis points in the average rate earned. Business loan interest income grew $2.6 million due to higher average balances of $580.9 million, or 9.5%, partly offset by a 34 basis point decrease in the average rate earned. Interest income on construction and land loans increased $402 thousand mainly due to growth in average balances of $177.0 million, or 12.5%, partly offset by a 71 basis point decrease in the average rate earned. These increases in interest income were slightly offset by a decrease in consumer credit card loan interest income of $1.3 million mainly due to an 85 basis point decrease in the average rate earned.
Interest income on investment securities (FTE) was $72.8 million during the first quarter of 2026, which was a decrease of $4.3 million from the same quarter last year. The largest decreases in interest income occurred in interest earned on asset-backed and mortgage-backed securities, which declined $2.9 million and $2.6 million, respectively. Interest income earned on asset-backed securities declined due to a $454.5 million decrease in average balances, partly offset by a 34 basis point increase in the average rate earned. A decrease of $577.0 million, or 12.1%, in average balances led to the decline in interest income on mortgage-backed securities. In addition, the Company recorded a $940 thousand adjustment to premium amortization at March 31, 2026, which increased interest income and reflected slower forward prepayment speed estimates on mortgage-backed securities. This increase was higher than the $539 thousand adjustment increasing income in the same quarter last year. These decreases to interest income were partly offset by growth of $2.3 million in interest income on U.S. government and federal agency obligations, driven by higher average balances of $603.9 million, or 23.3%, partly offset by a decline of 49 basis points in the average rate earned. Interest income related to the Company's U.S. Treasury inflation-protected securities, which is tied to the non-seasonally adjusted Consumer Price Index (CPI-U), decreased $3.1 million from the same quarter last year. The average balance of the total investment portfolio (excluding unrealized fair value adjustments on available for sale debt securities) was $9.9 billion in the first quarter of 2026 and $10.5 billion in the first quarter of 2025.
Interest income on securities purchased under agreements to resell increased $1.0 million over the same quarter last year, due to an increase of 22 basis points in the average rate earned and growth of $61.1 million in the average balance. Interest income on deposits at the Federal Reserve increased $1.1 million due to an increase of $608.8 million in the average balance, partly offset by a decline of 76 basis points in the average rate earned.
The average fully taxable-equivalent yield on total interest earning assets was 4.74% in the first quarter of 2026, down from 4.81% in the first quarter of 2025.
Total interest expense increased $1.4 million compared to the first quarter of 2025 due an increase of $4.1 million in interest expense on interest bearing deposits, partly offset by a decrease of $2.7 million in interest expense on borrowings. The increase in deposit interest expense was primarily due to the acquisition of FineMark, which added $2.7 billion in interest bearing deposit balances. Compared to the same quarter last year, interest expense on interest checking and money market deposit balances increased $6.1 million due to growth of $2.1 billion, or 15.2%, in average balances, partly offset by a four basis point decline in the average rate paid. Interest expense on certificate of deposit accounts decreased $2.1 million due to a 56 basis point decline in average rates paid, partly offset by an increase of $144.8 million, or 6.1%, in average balances. The overall rate paid on total deposits decreased 11 basis points from the same quarter last year. Interest expense on customer repurchase agreements decreased $3.4 million due to a 47 basis point decline in the average rate paid and a decrease of $48.7 million, or
1.8%, in the average balance. The overall average rate incurred on all interest bearing liabilities was 1.72% and 1.89% in the first quarters of 2026 and 2025, respectively.
Summaries of average assets and liabilities and the corresponding average rates earned/paid appear on the last page of this discussion.
Non-Interest Income
Three Months Ended March 31 Increase (Decrease)
(Dollars in thousands) 2026 2025 Amount % change
Trust fees $ 71,049 $ 56,592 $ 14,457 25.5 %
Bank card transaction fees 45,585 45,593 (8) -
Deposit account charges and other fees 28,578 26,622 1,956 7.3
Consumer brokerage services 5,444 4,785 659 13.8
Capital market fees 5,338 5,112 226 4.4
Loan fees and sales 3,243 3,404 (161) (4.7)
Other 16,614 16,841 (227) (1.3)
Total non-interest income $ 175,851 $ 158,949 $ 16,902 10.6 %
Non-interest income as a % of total revenue* 37.0 % 37.1 %
* Total revenue includes net interest income and non-interest income.
The table below is a summary of net bank card transaction fees for the three month periods ended March 31, 2026 and 2025.
Three Months Ended March 31
(Dollars in thousands) 2026 2025 $ change % change
Net debit card fees $ 10,589 $ 10,288 $ 301 2.9 %
Net credit card fees 3,435 3,608 (173) (4.8)
Net merchant fees 5,583 5,767 (184) (3.2)
Net corporate card fees 25,978 25,930 48 .2
Total bank card transaction fees $ 45,585 $ 45,593 $ (8) - %
For the first quarter of 2026, total non-interest income amounted to $175.9 million compared to $158.9 million in the same quarter last year, which was an increase of $16.9 million, or 10.6%. The increase was mainly due to higher trust fees and deposit account fees. Trust fees increased $14.5 million, or 25.5%, mainly due to growth of $13.5 million in private client trust fees. Bank card transaction fees for the current quarter were flat compared to the same period last year. Net credit card fees decreased $173 thousand mainly due to higher rewards expense and net merchant fees decreased $184 thousand. Net corporate card fees were flat compared to the same period last year, while net debit card fees increased $301 thousand mainly due to higher interchange income. Compared to the first quarter of last year, deposit account fees increased $2.0 million, or 7.3%, mainly due to higher corporate cash management fees of $1.5 million. Capital market fees increased $226 thousand, or 4.4%, while consumer brokerage service fees increased $659 thousand, or 13.8%, mainly due to higher advisory fees. Other non-interest income decreased $227 thousand, or 1.3%, mainly due to a decrease of $911 thousand in gains on the sales of assets and a decrease of $1.3 million in fair value adjustments recorded on the Company's deferred compensation plan assets and liabilities. These decreases were partly offset by an increase of $1.2 million in cash sweep commissions.
Investment Securities Gains (Losses), Net
Three Months Ended March 31
(In thousands) 2026 2025
Net gains (losses) on sales of available for sale debt securities $ - $ 4
Net gains (losses) on equity securities 160 (97)
Net gains (losses) on sales of private equity investments 597 1,027
Fair value adjustments on private equity investments 10,890 (8,525)
Total investment securities gains (losses), net $ 11,647 $ (7,591)
Net gains and losses on investment securities, which were recognized in earnings during the three months ended March 31, 2026 and 2025, are shown in the table above. Net securities gains of $11.6 million were reported in the first quarter of 2026, compared to net losses of $7.6 million in the same period last year. The net gains in the first quarter of 2026 were mainly comprised of net gains in fair value of $10.9 million recorded on private equity investments and net gains of $597 thousand on sales of private equity investments. The net losses on investment securities for the same quarter last year were primarily comprised of net losses in fair value of $8.5 million recorded on private equity investments, partly offset by net gains of $1.0 million on sales of private equity investments. The portion of private equity activity attributable to minority interests is reported as non-controlling interest in the consolidated statements of income and resulted in expense of $2.3 million during the first three months of 2026 and income of $1.5 million during the first three months of 2025.
Non-Interest Expense
Three Months Ended March 31 Increase (Decrease)
(Dollars in thousands) 2026 2025 Amount % change
Salaries and employee benefits $ 180,787 $ 153,078 $ 27,709 18.1 %
Data processing and software 38,328 32,238 6,090 18.9
Professional and other services 18,792 10,026 8,766 87.4
Net occupancy 15,308 14,020 1,288 9.2
Marketing 6,957 5,843 1,114 19.1
Equipment 5,671 5,248 423 8.1
Supplies and communication 5,238 5,046 192 3.8
Deposit insurance 3,914 3,744 170 4.5
Other 16,131 9,133 6,998 76.6
Total non-interest expense $ 291,126 $ 238,376 $ 52,750 22.1 %
Non-interest expense for the first quarter of 2026 amounted to $291.1 million, an increase of $52.8 million, or 22.1%, compared to expense of $238.4 million in the first quarter of last year. The current quarter included $14.0 million in acquisition-related expense, as well as acquisition-related intangible amortization expense of $5.4 million. The increase in expense over the same period last year was mainly due to higher salaries and employee benefits expense, data processing and software expense, professional and other services expense and intangible amortization expense. Salaries and employee benefits expense increased $27.7 million, or 18.1%, mainly due to an accrual for retention bonuses, acquisition-related compensation payments and the onboarding of FineMark's team members. Salaries and benefits expense included acquisition-related costs of $6.6 million in the current quarter. Full-time salaries, incentive compensation and healthcare expense increased $13.4 million, $7.7 million and $2.2 million, respectively, over the prior year. Full-time equivalent employees totaled 4,960 at March 31, 2026, compared to 4,662 at March 31, 2025. Data processing and software expense increased $6.1 million, or 18.9%, mainly due to higher costs for service providers and software. Professional and other services expense, which increased $8.8 million, or 87.4%, included $4.7 million of acquisition-related legal and professional services expense. Net occupancy expense increased $1.3 million, or 9.2%, mainly due to higher building depreciation expense. Other non-interest expense increased $7.0 million, or 76.6%, mainly due to increases of $5.4 million in intangible amortization expense related to the FineMark acquisition and $2.0 million in other acquisition-related expense. In addition, travel and entertainment expense increased $1.0 million, while a decrease in fair value adjustments of $1.3 million was recorded on the Company's deferred compensation plan assets and liabilities.
Provision and Allowance for Credit Losses on Loans and Liability for Unfunded Lending Commitments
Three Months Ended
(In thousands) Mar. 31, 2026 Dec. 31, 2025 Mar. 31, 2025
ALLOWANCE FOR CREDIT LOSSES ON LOANS
Balance at end of prior period $ 179,468 $ 175,671 $ 162,742
Initial allowance for credit losses on purchased credit deteriorated loans at acquisition 2,957 - -
Initial allowance for credit losses on purchased seasoned loans at acquisition 19,871 - -
Provision for credit losses on loans 11,283 13,660 15,095
Net loan charge-offs (recoveries):
Commercial:
Business 241 222 46
Real estate-construction and land - 16 -
Real estate-business 5,405 (24) 377
Commercial net loan charge-offs (recoveries) 5,646 214 423
Personal Banking:
Real estate-personal 2 180 72
Consumer 1,768 2,498 2,852
Revolving home equity 6 (2) (3)
Consumer credit card 7,139 6,488 6,967
Overdrafts 413 485 495
Personal banking net loan charge-offs (recoveries) 9,328 9,649 10,383
Total net loan charge-offs (recoveries) 14,974 9,863 10,806
Balance at end of period $ 198,605 $ 179,468 $ 167,031
LIABILITY FOR UNFUNDED LENDING COMMITMENTS
Balance at beginning of period $ 17,660 $ 15,327 $ 18,935
Initial allowance for credit loss at acquisition 362 - -
Provision for credit losses on unfunded lending commitments (323) 2,333 (608)
Balance at end of period 17,699 17,660 18,327
ALLOWANCE FOR CREDIT LOSSES ON LOANS AND LIABILITY FOR UNFUNDED LENDING COMMITMENTS $ 216,304 $ 197,128 $ 185,358
Three Months Ended
Mar. 31, 2026 Dec. 31, 2025 Mar. 31, 2025
Annualized net loan charge-offs (recoveries)*:
Commercial:
Business .01 % .01 % - %
Real estate-construction and land - - -
Real estate-business .54 - .04
Commercial net loan charge-offs (recoveries) .19 .01 .02
Personal Banking:
Real estate-personal - .02 .01
Consumer .30 .45 .56
Revolving home equity - - -
Consumer credit card 5.21 4.55 5.04
Overdrafts 23.45 29.19 34.26
Personal banking net loan charge-offs (recoveries) .47 .62 .70
Total annualized net loan charge-offs (recoveries) .30 % .22 % .25 %
* as a percentage of average loans (excluding loans held for sale)
The following schedule provides a breakdown of the allowance for credit losses on loans (ACL) by loan class and the percentage of the allowance for credit losses to the related loan class at period end.
Mar. 31, 2026 Dec. 31, 2025 Mar. 31, 2025
(Dollars in thousands)
Credit Loss Allowance Allocation % of ACL to Loan Category Credit Loss Allowance Allocation % of ACL to Loan Category Credit Loss Allowance Allocation % of ACL to Loan Category
Business $ 58,674 .87 % $ 53,238 .83 % $ 45,669 .73 %
RE - construction and land 31,430 1.99 29,053 2.02 29,284 2.06
RE - business 35,133 .87 34,574 .94 31,747 .87
RE - personal 22,065 .50 10,915 .36 13,475 .44
Consumer 15,838 .64 15,624 .71 14,967 .71
Revolving home equity 3,403 .55 1,738 .46 1,857 .52
Consumer credit card 31,945 5.73 34,178 5.80 29,904 5.26
Overdrafts 117 1.23 148 3.53 128 4.09
Total $ 198,605 .97 % $ 179,468 1.01 % $ 167,031 .96 %
To determine the amount of the allowance for credit losses on loans and the liability for unfunded lending commitments, the Company has an established process which assesses the risks and losses expected in its portfolios. This process provides an allowance based on estimates of allowances for pools of loans and unfunded lending commitments, as well as a second, smaller component based on certain individually evaluated loans and unfunded lending commitments. The Company's policies and processes for determining the allowance for credit losses on loans and the liability for unfunded lending commitments are discussed in Note 1 to the consolidated financial statements and in the "Allowance for Credit Losses" discussion within Critical Accounting Estimates and Related Policies in Item 7 of the 2025 Annual Report on Form 10-K.
Net loan charge-offs in the first quarter of 2026 amounted to $15.0 million, compared to $9.9 million in the prior quarter and $10.8 million in the first quarter of last year. Compared to the same period last year, net loan charge-offs in the first quarter of 2026 increased $4.2 million, and increased $5.1 million from the previous quarter. The increase from the prior year was mainly driven by an increase of $5.0 million in business real estate loan net charge-offs, offset by a decrease of $1.1 million in consumer loan net charge-offs. The increase in net loan charge-offs for the three months ended March 31, 2026 from the previous quarter was driven by increases of $5.4 million and $651 thousand in net charge-offs on business real estate and consumer credit card loans, respectively, partially offset by a decrease of $730 thousand in net charge-offs on consumer loans.
For the three months ended March 31, 2026, annualized net charge-offs on average consumer credit card loans were 5.21%, compared to 4.55% in the previous quarter and 5.04% in the same period last year. Consumer loan annualized net charge-offs in the current quarter amounted to .30%, compared to .45% in the prior quarter and .56% in the same period last year. In the first quarter of 2026, total annualized net loan charge-offs were .30%, compared to .22% in the previous quarter and .25% in the same period last year.
For the three months ended March 31, 2026, the provision for credit losses on loans was $11.3 million, which was a decrease of $2.4 million from the provision recorded in the prior quarter. Compared to the same period in the prior year, the provision for credit losses on loans for the three months ended March 31, 2026 decreased $3.8 million. Changes in the provision are driven by changes in the estimate for the allowance for credit losses on loans.
At March 31, 2026, the allowance for credit losses increased $19.1 million compared to the allowance for credit losses on loans at December 31, 2025. The most significant driver of the increase in the allowance for credit losses is due to an increase in loan balances as a result of the acquisition of FineMark, as the initial allowance for FineMark loans acquired was $22.8 million. The allowance for credit losses on loans increased $8.4 million in the commercial portfolio, and the allowance for credit losses on the Company's personal banking portfolio increased $10.8 million. The allowance as a percentage of outstanding loans decreased compared to the prior quarter due to the change in mix of loans, as the acquired loan portfolio included more personal real estate loans which carry a lower allowance for credit losses than other classes. The forecast utilized to estimate the allowance for credit losses on loans at March 31, 2026 assumes a slow but continued economic expansion, and changes in the forecast utilized to estimate the allowance at March 31, 2026 did not significantly change the allowance estimate during the quarter. The allowance for credit losses on loans was $198.6 million at March 31, 2026 and was .97%, 1.01% and .96% of total loans at March 31, 2026, December 31, 2025 and March 31, 2025, respectively.
In the current quarter, the provision for credit losses on unfunded lending commitments was a benefit of $323 thousand, compared to a benefit of $608 thousand for the three months ended March 31, 2025. At March 31, 2026, the liability for unfunded lending commitments was $17.7 million, compared to $17.7 million at December 31, 2025 and $18.3 million at March 31, 2025. At March 31, 2026, the liability for unfunded lending commitments remained largely unchanged from December 31, 2025, because the initial liability recorded related to the FineMark acquisition of $362 thousand was largely offset by a decrease in the provision for the liability for unfunded lending commitments. The Company's unfunded lending commitments primarily relate to construction loans, and the Company's estimate for credit losses in its unfunded lending commitments utilizes the same model and forecast as its estimate for credit losses on loans. See Note 3 for further discussion of the model inputs utilized in the Company's estimate of credit losses.
The Company considers the allowance for credit losses on loans and the liability for unfunded commitments adequate to cover losses expected in the loan portfolio, including unfunded commitments, at March 31, 2026.
The allowance for credit losses on loans and the liability for unfunded lending commitments are estimates that require significant judgment including projections of the macro-economic environment. The Company utilizes a third-party macro-economic forecast that continuously changes due to economic conditions and events. These changes in the forecast cause fluctuations in the allowance for credit losses on loans and the liability for unfunded lending commitments. The Company uses judgment to assess the macro-economic forecast and internal loss data in estimating the allowance for credit losses on loans and the liability for unfunded lending commitments. These estimates are subject to periodic refinement based on changes in the underlying external and internal data.
Risk Elements of the Loan Portfolio
The following table presents non-performing assets and loans which are past due 90 days and still accruing interest. Non-performing assets include non-accruing loans and foreclosed real estate. Loans are placed on non-accrual status when management does not expect to collect payments consistent with acceptable and agreed upon terms of repayment. Loans that are 90 days past due as to principal and/or interest payments are generally placed on non-accrual, unless they are both well-secured and in the process of collection, or they are personal banking loans that are exempt under regulatory rules from being classified as non-accrual.
(Dollars in thousands)
March 31, 2026 December 31, 2025
Non-accrual loans $ 10,920 $ 15,750
Foreclosed real estate 678 1,218
Total non-performing assets $ 11,598 $ 16,968
Non-performing assets as a percentage of total loans .06 % .10 %
Non-performing assets as a percentage of total assets .03 % .05 %
Total loans past due 90 days and still accruing interest $ 22,824 $ 24,659
Non-accrual loans totaled $10.9 million at March 31, 2026, a decrease of $4.8 million from the balance at December 31, 2025. The decrease occurred mainly in business real estate non-accrual loans, which decreased $5.4 million. At March 31, 2026, non-accrual loans were comprised of business real estate (85.8%), personal real estate (12.1%), business (1.8%), and revolving home equity (0.3%) loans. Foreclosed real estate totaled $678 thousand at March 31, 2026, a decrease of $540 thousand compared to December 31, 2025. Total loans past due 90 days or more and still accruing interest totaled $22.8 million as of March 31, 2026, a decrease of $1.8 million from December 31, 2025. Balances by class for non-accrual loans and loans past due 90 days and still accruing interest are shown in the "Delinquent and non-accrual loans" section in Note 3 to the consolidated financial statements.
In addition to the non-performing and past due loans mentioned above, the Company also has identified loans for which management has concerns about the ability of the borrowers to meet existing repayment terms. They are classified as substandard under the Company's internal rating system. The loans are generally secured by either real estate or other borrower assets, reducing the potential for loss should they become non-performing. Although these loans are generally identified as potential problem loans, they may never become non-performing. Such loans totaled $296.2 million at March 31, 2026 compared to $264.9 million at December 31, 2025, resulting in an increase of $31.3 million, or 11.8%.
(In thousands)
March 31, 2026 December 31, 2025
Potential problem loans:
Business $ 163,740 $ 112,018
Real estate - construction and land 28,340 46,622
Real estate - business 102,505 106,163
Real estate - personal 1,593 91
Consumer 14 -
Total potential problem loans $ 296,192 $ 264,894
When borrowers are experiencing financial difficulty, the Company may agree to modify the contractual terms of a loan to a borrower in order to assist the borrower in repaying principal and interest owed to the Company. At March 31, 2026, the Company held $66.9 million of loans that had been modified during the three months ended March 31, 2026. These loans are further discussed in the "Modifications for borrowers experiencing financial difficulty" section in Note 3 to the consolidated financial statements.
Loans with Special Risk Characteristics
Management relies primarily on an internal risk rating system, in addition to delinquency status, to assess risk in the loan portfolio, and these statistics are presented in Note 3 to the consolidated financial statements. However, certain types of loans are considered at high risk of loss due to their terms, location, or special conditions. Additional information about the major types of loans in these categories and their risk features are provided below. Information based on loan-to-value (LTV) ratios was generally calculated with valuations at loan origination date. The Company normally obtains an updated appraisal or valuation at the time a loan is renewed or modified, or if the loan becomes significantly delinquent or is in the process of being foreclosed upon.
Real Estate - Construction and Land Loans
The Company's portfolio of construction and land loans, as shown in the table below, amounted to 7.7% of total loans outstanding at March 31, 2026. The largest component of construction and land loans was commercial construction, which decreased $26.6 million during the three months ended March 31, 2026. At March 31, 2026, multi-family residential construction loans totaled approximately $529.5 million, or 44.1%, of the commercial construction loan portfolio, compared to $553.1 million, or 45.1%, at December 31, 2025.
(Dollars in thousands) March 31,
2026
% of Total
% of
Total
Loans
December 31, 2025
% of Total
% of
Total
Loans
Commercial construction $ 1,199,804 75.9 % 5.9 % $ 1,226,363 85.3 % 6.9 %
Residential construction 253,896 16.1 1.1 105,874 7.4 .6
Residential land and land development 73,501 4.5 .4 63,288 4.3 .4
Commercial land and land development 54,588 3.5 .3 42,487 3.0 .2
Total real estate - construction and land loans $ 1,581,789 100.0 % 7.7 % $ 1,438,012 100.0 % 8.1 %
Real Estate - Business Loans
Total business real estate loans were $4.1 billion at March 31, 2026 and comprised 19.8% of the Company's total loan portfolio. These loans include properties such as manufacturing and warehouse buildings, small office and medical buildings, churches, hotels and motels, shopping centers, and other commercial properties. At March 31, 2026, 37.1% of business real estate loans were for owner-occupied real estate properties, which have historically resulted in lower net charge-off rates than non-owner-occupied commercial real estate loans.
(Dollars in thousands) March 31,
2026
% of Total
% of
Total
Loans
December 31, 2025
% of Total
% of
Total
Loans
Owner-occupied $ 1,504,132 37.1 % 7.4 % $ 1,248,172 34.0 % 7.0 %
Industrial 648,223 16.0 3.2 628,223 17.1 3.5
Office 611,456 15.1 3.0 528,421 14.4 3.0
Hotels 355,576 8.8 1.7 326,147 8.9 1.8
Multi-family 283,752 7.0 1.4 317,541 8.6 1.8
Retail 306,937 7.6 1.5 292,490 8.0 1.6
Farm 197,379 4.9 1.0 199,678 5.4 1.1
Senior living 37,600 .9 .2 43,161 1.2 .2
Other 114,484 2.6 .4 90,734 2.4 .7
Total real estate - business loans $ 4,059,539 100.0 % 19.8 % $ 3,674,567 100.0 % 20.7 %
Information about the credit quality of the Company's business real estate loan portfolio as of March 31, 2026 and December 31, 2025 is provided in the table below.
(Dollars in thousands) Pass Special Mention Substandard Non-Accrual Total
March 31, 2026
Owner-occupied $ 1,432,564 $ 10,851 $ 60,593 $ 124 $ 1,504,132
Industrial 648,223 - - - 648,223
Office 559,736 - 51,720 - 611,456
Hotels 353,300 2,276 - - 355,576
Multi-family 241,999 41,753 - - 283,752
Retail 306,937 - - - 306,937
Farm 195,980 1,194 52 153 197,379
Senior living 22,146 - 6,362 9,092 37,600
Other 112,528 1,567 389 - 114,484
Total $ 3,873,413 $ 57,641 $ 119,116 $ 9,369 $ 4,059,539
December 31, 2025
Owner-occupied $ 1,198,970 $ 18,011 $ 31,067 $ 124 $ 1,248,172
Industrial 628,223 - - - 628,223
Office 443,737 27,175 57,509 - 528,421
Hotels 326,147 - - - 326,147
Multi-family 250,018 56,633 10,890 - 317,541
Retail 292,490 - - - 292,490
Farm 197,566 1,686 273 153 199,678
Senior living 22,262 - 6,391 14,508 43,161
Other 89,157 1,577 - - 90,734
Total $ 3,448,570 $ 105,082 $ 106,130 $ 14,785 $ 3,674,567
Revolving Home Equity Loans
The Company had $619.2 million in revolving home equity loans at March 31, 2026 that were collateralized by residential real estate. Most of these loans (94.9%) are written with terms requiring interest-only monthly payments. These loans are offered in three main product lines: LTV up to 80%, 80% to 90%, and 90% to 100%. As of March 31, 2026, the outstanding principal of loans with an original LTV higher than 80% was $78.6 million, or 12.6% of the portfolio, compared to $27.7 million as of December 31, 2025. Total revolving home equity loan balances over 30 days past due were $4.8 million at March 31, 2026 and $1.9 million at December 31, 2025, and the outstanding balance for revolving home equity loans on non-accrual status was $34 thousand at March 31, 2026 compared to no balance at December 31, 2025. The weighted average FICO score for the total portfolio balance at March 31, 2026 is 776. At maturity, the accounts are re-underwritten, and if they qualify under the Company's credit, collateral and capacity policies, the borrower is given the option to renew the line of credit or convert the outstanding balance to an amortizing loan. If criteria are not met, amortization is required, or the borrower may pay off the loan. During the remainder of 2026 through 2029, approximately 20.5% of the Company's current outstanding balances are expected to mature. Of these balances, approximately 83.2% have a FICO score of 700 or higher. The Company does not expect a significant increase in losses as these loans mature, due to their high FICO scores, low LTVs, and low historical loss levels.
Consumer Loans
The consumer loans category is mostly comprised of private banking loans and automobile loans. Private banking loans comprised of 48.2% of the consumer loan portfolio at March 31, 2026. The Company's private banking loans are mostly executive lines of credit, which are secured primarily by assets held by the Company's trust department, and insurance premium finance loans, which are primarily secured by life insurance policies. Automobile loans, which include direct and indirect product lines, comprised 30.5% of the consumer loan portfolio at March 31, 2026, and outstanding balances for auto loans were $754.3 million and $773.6 million at March 31, 2026 and December 31, 2025, respectively. The balances over 30 days past due amounted to $8.4 million at March 31, 2026 and $11.0 million at December 31, 2025, respectively, and comprised 1.1% of the outstanding balances of these loans at March 31, 2026 and 1.4% at December 31, 2025. For the three months ended March 31, 2026, $88.2 million of new auto loans were originated, compared to $98.0 million during the first three months of 2025. At
March 31, 2026, the automobile loan portfolio had a weighted average FICO score of 759, and net charge-offs on auto loans were .5% of average auto loans.
The Company's consumer loan portfolio also includes fixed rate home equity loans, typically for home repair or remodeling, and these loans comprised 8.5% of the consumer loan portfolio at March 31, 2026. Losses on these loans have historically been low, and the Company saw net recoveries of $591 thousand for the first three months of 2026. The remaining portion of the Company's consumer loan portfolio is comprised of healthcare financing, boat, RV, motorcycle, other equipment, and unsecured consumer loans. Net charge-offs on consumer loans, other than automobile and fixed rate home equity loans, totaled $755 thousand in the first three months of 2026 and were .2% of the average balances of these loans at March 31, 2026.
Consumer Credit Card Loans
The Company offers low promotional rates on selected consumer credit card products. Out of a portfolio at March 31, 2026 of $557.7 million in consumer credit card loans outstanding, approximately $120.5 million, or 21.6%, carried a low promotional rate. Within the next six months, $54.5 million of these loans are scheduled to convert to the ongoing higher contractual rate. To mitigate some of the risk involved with this credit card product, the Company performs credit checks and detailed analysis of the customer borrowing profile before approving the loan application. Management believes that the risks in the consumer loan portfolio are reasonable and the anticipated loss ratios are within acceptable parameters.
March 31, 2026 December 31, 2025
FICO score:
Under 600
5.5 % 5.4 %
600 - 659
12.3 12.3
660 - 719
28.3 27.4
720 - 779
26.5 26.3
780 and over
27.4 28.6
Total
100.0 % 100.0 %
Oil and Gas Energy Lending
The Company's energy lending portfolio is comprised of lending to the petroleum and natural gas sectors and totaled $369.6 million, or 1.8% of total loans at March 31, 2026, an increase of $66.5 million from December 31, 2025, as shown in the table below.
(In thousands)
March 31, 2026 December 31, 2025
Unfunded commitments at March 31, 2026
Upstream activities $ 232,000 $ 228,660 $ 146,090
Mid-stream activities 42,478 25,038 124,661
Downstream activities 29,681 15,543 14,381
Support activities 65,407 33,803 15,800
Total energy lending portfolio $ 369,566 $ 303,044 $ 300,932
Shared National Credits
The Company participates in credits of large, publicly traded companies which are defined by regulation as shared national credits, or SNCs. Regulations define SNCs as loans exceeding $100 million that are shared by three or more financial institutions. The Company typically participates in these loans when business operations are maintained in the local communities or regional markets and opportunities to provide other banking services are present. The balance of SNC loans totaled $1.7 billion at March 31, 2026 and $1.5 billion December 31, 2025. Additional unfunded commitments at March 31, 2026 totaled $2.4 billion.
Income Taxes
Income tax expense was $40.9 million in the first quarter of 2026, compared to $40.6 million in the fourth quarter of 2025 and $37.0 million in the first quarter of 2025. The Company's effective tax rate, including the effect of non-controlling interest, was 22.4% in the first quarter of 2026, 22.4% in the fourth quarter of 2025, and 21.9% in the first quarter of 2025.
Financial Condition
Balance Sheet
Total assets of the Company were $35.7 billion at March 31, 2026 and $32.9 billion at December 31, 2025. Earning assets (excluding the allowance for credit losses on loans and fair value adjustments on available for sale debt securities) amounted to $34.3 billion at March 31, 2026 and $31.4 billion at December 31, 2025, and consisted of 60% in loans and 28% in investment securities at March 31, 2026.
During the first quarter of 2026, average loans totaled $20.3 billion, an increase of $2.7 billion over the prior quarter, and an increase of $3.1 billion over the same quarter last year. The increase in average balances over both periods was primarily due to the acquisition of FineMark, which added $2.7 billion in loan balances. Compared to the previous quarter, average balances of personal real estate, business, business real estate, revolving home equity and consumer loans grew $1.4 billion, $369.3 million, $315.0 million, $238.9 million and $221.0 million, respectively. During the current quarter, the Company sold certain fixed rate personal real estate loans totaling $26.2 million, compared to $27.0 million in the prior quarter.
Total average available for sale debt securities decreased $269.0 million from the previous quarter to $8.9 billion, at fair value. The decrease in available for sale debt securities was mainly the result of lower average balances of mortgage-backed and asset-backed securities. During the first quarter of 2026, the unrealized loss on available for sale debt securities increased $40.7 million to $687.5 million, at period end. Also, during the first quarter of 2026, maturities and pay downs of available for sale debt securities were $410.7 million. At March 31, 2026, the duration of the available for sale investment portfolio was 4.2 years, and maturities and pay downs of approximately $1.2 billion are expected to occur during the next 12 months.
Average interest earning deposits with banks increased $210.4 million over average balances in the previous quarter, and the average balance within other assets increased $374.4 million mainly due to increases in goodwill, intangible assets, and premises and equipment related to the Company's acquisition of FineMark.
Total average deposits increased $2.1 billion over the previous quarter. The increase in average balances was primarily due to the FineMark acquisition, which added $2.7 billion in interest bearing and $425 million in non-interest bearing deposit balances. Shortly after the acquisition, the Company moved $1.0 billion of FineMark's high-cost, money market deposit balances off-balance sheet. Compared to the prior quarter, average interest checking and money market deposits and demand deposits increased $1.7 billion and $282.1 million, respectively. Additionally, average balances of certificates of deposit of $100,000 and over increased $76.0 million compared to the prior quarter, mainly due to deposit balances acquired from FineMark. Compared to the previous quarter, total average wealth and retail banking deposits grew $2.3 billion and $251.0 million, respectively, while commercial deposits declined $408.3 million. The average loans to deposits ratio was 73.4% in the current quarter and 69.0% in the prior quarter. The Company's average borrowings, which included average customer repurchase agreements of $2.7 billion, increased $345.7 million to $2.9 billion in the first quarter of 2026. Federal Home Loan Bank advances of $350.0 million, which the Company acquired from the FineMark acquisition, were paid off in January 2026.
Liquidity and Capital Resources
Liquidity Management
The Company's most liquid assets include balances at the Federal Reserve Bank, federal funds sold, available for sale debt securities, and securities purchased under agreements to resell, as follows:
(In thousands)
March 31, 2026 March 31, 2025 December 31, 2025
Liquid assets:
Balances at the Federal Reserve Bank $ 3,270,046 $ 2,756,521 $ 2,744,393
Federal funds sold 630 - -
Available for sale debt securities 8,646,127 9,264,947 9,095,513
Securities purchased under agreements to resell 850,000 - 850,000
Total $ 12,766,803 $ 12,021,468 $ 12,689,906
Interest earning balances at the Federal Reserve Bank, which have overnight maturities and are used for general liquidity purposes, totaled $3.3 billion at March 31, 2026 and increased $526 million from December 31, 2025. At March 31, 2026, the Company's balance of federal funds sold totaled $630 thousand, which are funds lent to the Company's correspondent bank customers with overnight maturities. The fair value of the available for sale debt portfolio was $8.6 billion at March 31, 2026 and included an unrealized net loss of $687.5 million. The total net unrealized loss included net losses of $620.0 million on mortgage-backed and asset-backed securities and $51.0 million on state and municipal obligations.
The Company holds securities purchased under agreements to resell ("resale agreements") which totaled $850.0 million at March 31, 2026, with maturities in 2028 through 2030. Under these agreements, the Company lends funds to upstream financial institutions and holds marketable securities, safe-kept by a third-party custodian, as collateral. This collateral totaled $871.1 million in fair value at March 31, 2026.
The Company's available for sale debt securities portfolio has a diverse mix of high quality and liquid investment securities with a duration of 4.2 years at March 31, 2026. Approximately $1.2 billion of the Company's available for sale debt portfolio is expected to mature or pay down during the next 12 months, and these funds offer substantial resources to meet either new loan demand or offset potential reductions in the Company's deposit funding base. The Company pledges portions of its investment securities portfolio to secure public fund deposits, securities sold under agreements to repurchase, trust funds, letters of credit issued by the FHLB, and borrowing capacity at the FHLB and the Federal Reserve Bank. Total investment securities pledged for these purposes were as follows:
(In thousands)
March 31, 2026 March 31, 2025 December 31, 2025
Investment securities pledged for the purpose of securing:
Federal Reserve Bank borrowings $ 524,689 $ 686,733 $ 538,874
FHLB borrowings and letters of credit 1,883,351 1,498,670 2,160,967
Securities sold under agreements to repurchase * 2,521,770 2,324,605 2,937,267
Other deposits and swaps 1,724,936 1,791,223 1,638,324
Total pledged securities 6,654,746 6,301,231 7,275,432
Unpledged and available for pledging 1,980,057 2,939,139 1,808,420
Ineligible for pledging 11,324 24,577 11,661
Total available for sale debt securities, at fair value $ 8,646,127 $ 9,264,947 $ 9,095,513
* Includes securities pledged for collateral swaps outstanding at each period end shown in the table.
The average loans to deposits ratio is a measure of a bank's liquidity, and the Company's average loans to deposits ratio was 73.4% for the three months ended March 31, 2026. Core customer deposits, defined as non-interest bearing, interest checking, savings, and money market deposit accounts totaled $25.9 billion and represented 91.4% of the Company's total deposits at March 31, 2026. These core deposits are normally less volatile, as they are often with customer relationships tied to other products offered by the Company, promoting long lasting relationships and stable funding sources. Core deposits increased $2.7 billion at March 31, 2026 compared to December 31, 2025, primarily due to an increase in wealth deposits from the acquisition of FineMark Holdings, Inc. While the Company considers core retail banking and wealth deposits less volatile, corporate deposits could decline if interest rates increase significantly, encouraging corporate customers to increase investing activities, or if the economy deteriorates and companies experience lower cash inflows, reducing deposit balances. If these corporate deposits decline, the Company's funding needs may be met by liquidity supplied by investment security maturities and pay downs expected to total $1.2 billion over the next year, as noted above. In addition, as shown in the table of collateral available for future advances below, the Company has borrowing capacity of $6.9 billion through advances from the FHLB and the Federal Reserve.
(In thousands)
March 31, 2026 March 31, 2025 December 31, 2025
Core deposit base:
Non-interest bearing $ 8,058,024 $ 7,518,243 $ 8,205,711
Interest checking 9,290,062 8,247,769 7,360,515
Savings and money market 8,587,774 7,727,514 7,686,891
Total $ 25,935,860 $ 23,493,526 $ 23,253,117
Certificates of deposit of $100,000 or greater totaled $1.4 billion at March 31, 2026. These deposits are normally considered more volatile and higher costing, and comprised 5.0% of total deposits at March 31, 2026.
The Company may occasionally issue short-term brokered certificates of deposit to test the reliability of this potential funding source. While it is not clear how many brokered certificates of deposit the market would allow the Company to issue, the Company believes brokered certificates of deposits may be an additional, reliable source of liquidity during periods of stress in the banking industry.
Other important components of liquidity are the level of borrowings from third party sources and the availability of future credit. During 2026, the Company's outside borrowings have mainly been comprised of federal funds purchased and repurchase agreements, as follows:
(In thousands)
March 31, 2026 March 31, 2025 December 31, 2025
Borrowings:
Federal funds purchased $ 129,730 $ 132,370 $ 128,625
Securities sold under agreements to repurchase 2,446,993 2,267,666 2,861,016
Other debt 8,045 17,743 12,798
Total $ 2,584,768 $ 2,417,779 $ 3,002,439
Federal funds purchased, which totaled $129.7 million at March 31, 2026, are unsecured overnight borrowings obtained mainly from upstream correspondent banks with which the Company maintains approved lines of credit. At March 31, 2026, the Company had approved lines of credit totaling $4.4 billion. Since these borrowings are unsecured and limited by market trading activity, their availability may be less certain than collateralized sources of borrowings. Retail repurchase agreements are offered to customers wishing to earn interest in highly liquid balances and are used by the Company as a funding source considered to be stable, but short-term in nature. Repurchase agreements are collateralized by securities in the Company's investment portfolio. Total repurchase agreements at March 31, 2026 were comprised of non-insured customer funds totaling $2.4 billion, and securities pledged as collateral for these retail agreements totaled $2.5 billion at March 31, 2026. The Company also borrows on a secured basis through advances from the FHLB. The advances are generally short-term, fixed interest rate borrowings. There were no advances outstanding from the FHLB at March 31, 2026.
The Company pledges certain assets, including loans and investment securities, to both the FRB and the FHLB as security to establish lines of credit and borrow from these entities. Based on the amount and type of collateral pledged, the FHLB establishes a collateral value from which the Company may draw advances against the collateral. Additionally, this collateral is used to enable the FHLB to issue letters of credit in favor of public fund depositors of the Company. The FRB also establishes a collateral value of assets pledged and permits borrowings from the discount window. The following table reflects the collateral value of assets pledged, borrowings, and letters of credit outstanding, in addition to the estimated future funding capacity available to the Company at March 31, 2026.
March 31, 2026
(In thousands)
FHLB
Federal Reserve
Total
Total collateral value established by FHLB and FRB $ 4,285,173 $ 2,758,589 $ 7,043,762
Letters of credit issued (141,217) - (141,217)
Available for future advances $ 4,143,956 $ 2,758,589 $ 6,902,545
The Company receives outside ratings from both Standard & Poor's and Moody's on the consolidated company and its subsidiary bank, Commerce Bank. These ratings are as follows:
Standard & Poor's Moody's
Commerce Bancshares, Inc.
Issuer rating A-
Rating outlook Stable
Commerce Bank
Issuer rating A A3
Baseline credit assessment a2
Short-term rating A-1 P-1
Rating outlook Stable Stable
The Company considers these ratings to be indications of a sound capital base and strong liquidity and believes that these ratings would help ensure the ready marketability of its commercial paper, should the need arise. No commercial paper has been outstanding during the past ten years. The Company has no subordinated or hybrid debt instruments which would affect future borrowing capacity. Because of its lack of significant long-term debt, the Company believes that through its Commercial
Tradable Products division or in other public debt markets, it could generate additional liquidity from sources such as jumbo certificates of deposit, privately placed corporate notes or other forms of debt.
The cash flows from the operating, investing and financing activities of the Company resulted in a net increase in cash, cash equivalents and restricted cash of $295.6 million during the first three months of 2026, as reported in the consolidated statements of cash flows in this report. Operating activities, consisting mainly of net income adjusted for certain non-cash items, provided cash flow of $684.8 million and have historically been a stable source of funds. Investing activities, which occur mainly in the loan and investment securities portfolios, provided cash of $859.2 million. This growth is primarily due to the cash assumed in the acquisition of FineMark Holdings, Inc., and sales, maturities, and pay downs (net of purchases) of investment securities, which provided cash of $428.9 million. Investing activities are somewhat unique to financial institutions in that, while large sums of cash flow are normally used to fund growth in investment securities, loans, or other bank assets, they are normally dependent on the financing activities described below. Financing activities used cash of $1.2 billion, largely resulting from repayments of FHLB borrowings (assumed in the FineMark acquisition), which used cash of $600.0 million, federal funds purchased and securities sold under agreements to repurchase, which used cash of $475.9 million, and a decrease of $287.7 million in deposits during the first three months of 2026. Cash dividend payments (including distributions to non-controlling interest) and purchases of treasury stock used cash of $41.9 million and $84.3 million, respectively.
Capital Management
The Company met all capital adequacy requirements and had regulatory capital ratios in excess of the levels established for well-capitalized institutions at March 31, 2026 and December 31, 2025, as shown in the following table.
(Dollars in thousands) March 31, 2026 December 31, 2025 Minimum Capital Requirement Capital Conservation Buffer
Minimum Ratios Requirement including Capital Conservation Buffer
Minimum Ratios
for
Well-Capitalized
Banks *
Risk-adjusted assets $ 26,291,306 $ 23,970,761
Tier I common risk-based capital 4,492,333 4,156,776
Tier I risk-based capital 4,492,333 4,156,776
Total risk-based capital 4,705,679 4,353,905
Tier I common risk-based capital ratio 17.09 % 17.34 % 4.50 % 2.50 % 7.00 % 6.50 %
Tier I risk-based capital ratio 17.09 17.34 6.00 2.50 8.50 8.00
Total risk-based capital ratio 17.90 18.16 8.00 2.50 10.50 10.00
Tier I leverage ratio 12.60 12.65 4.00 N/A 4.00 5.00
*Under Prompt Corrective Action requirements
The Company is subject to a 2.5% capital conservation buffer, which is an amount above the minimum ratios under capital adequacy guidelines, and is intended to absorb losses during periods of economic stress. Failure to maintain the buffer will result in constraints on dividends, share repurchases, and executive compensation.
The Company maintains a treasury stock buyback program under authorizations by its Board of Directors (the Board) and periodically purchases stock in the open market. During the three months ended March 31, 2026, the Company purchased 1,624,840 shares at an average price of $51.56 in open market purchases and stock-based compensation transactions. At March 31, 2026, 1,634,000 shares remained available for purchase under the Board authorization in place at that date. On April 24, 2026, the share repurchase authorization was increased to 7,500,000 shares.
The Company's common stock dividend policy reflects its earnings outlook, desired payout ratios, the need to maintain adequate capital levels and alternative investment options. The Company paid a $.275 per share cash dividend on its common stock in the first quarter of 2026, which was a 5.0% increase compared to its 2025 quarterly dividend.
Material Cash Requirements, Commitments, Off-Balance Sheet Arrangements and Contingencies
The Company's material cash requirements include commitments for contractual obligations (both short-term and long-term), commitments to extend credit, and off-balance sheet arrangements. The Company's material cash requirements for the next 12 months are primarily to fund loan growth. Additionally, the Company will utilize cash to fund deposit maturities and withdrawals that may occur in the next 12 months. Other contractual obligations, purchase commitments, lease obligations, and unfunded commitments may require cash payments by the Company within the next 12 months, and these are further discussed
in the Company's 2025 Annual Report on Form 10-K. Further discussion of the Company's longer-term material cash obligations and sources for fulfilling those obligations is below.
In the normal course of business, various commitments and contingent liabilities arise that are not required to be recorded on the balance sheet. The most significant of these are loan commitments, which at March 31, 2026 totaled $16.9 billion (including $6.2 billion in unused, approved credit card lines). In addition, the Company enters into standby and commercial letters of credit. The contractual amount of standby and commercial letters of credit totaled $668.8 million and $1.8 million, respectively, at March 31, 2026. As many commitments expire unused or only partially used, these totals do not necessarily reflect future cash requirements. The allowance for these commitments is recorded in the Company's liability for unfunded lending commitments within other liabilities on its consolidated balance sheets. At March 31, 2026, the liability for unfunded lending commitments totaled $17.7 million. See further discussion of the liability for unfunded lending commitments in Note 3 to the consolidated financial statements.
The Company regularly purchases various state tax credits arising from third party property redevelopment. These credits are either resold to third parties at a profit or retained for use by the Company. During the first three months of 2026, purchases and sales of tax credits amounted to $14.0 million and $45.2 million, respectively. Fees from sales of tax credits were $1.5 million for the three months ended March 31, 2026, compared to $1.9 million in the same period last year. At March 31, 2026, the Company expected to fund outstanding purchase commitments of $142.9 million during the remainder of 2026 and had purchase commitments of $471.6 million that it expects to fund from 2027 through 2030.
The Company continued to maintain a strong liquidity position throughout the first three months of 2026. Through the various sources of liquidity described above, the Company maintains a liquidity position that it believes will adequately satisfy its financial obligations.
Segment Results
The table below is a summary of segment pre-tax income results for the first three months of 2026 and 2025.
(Dollars in thousands)
Retail Banking
Commercial
Wealth
Segment
Totals
Other/ Elimination
Consolidated Totals
Three Months Ended March 31, 2026
Net interest income $ 122,572 $ 133,601 $ 46,123 $ 302,296 $ (2,456) $ 299,840
Provision for credit losses (9,271) (5,696) 2 (14,965) 4,005 (10,960)
Non-interest income 24,093 68,936 80,220 173,249 2,602 175,851
Investment securities gains (losses), net - - - - 11,647 11,647
Non-interest expense (87,873) (112,827) (63,117) (263,817) (27,309) (291,126)
Income before income taxes $ 49,521 $ 84,014 $ 63,228 $ 196,763 $ (11,511) $ 185,252
Three Months Ended March 31, 2025
Net interest income $ 125,234 $ 133,266 $ 22,159 $ 280,659 $ (11,557) $ 269,102
Provision for credit losses (10,250) (532) - (10,782) (3,705) (14,487)
Non-interest income 23,260 70,326 64,038 157,624 1,325 158,949
Investment securities gains (losses), net - - - - (7,591) (7,591)
Non-interest expense (83,005) (103,969) (41,189) (228,163) (10,213) (238,376)
Income before income taxes $ 55,239 $ 99,091 $ 45,008 $ 199,338 $ (31,741) $ 167,597
Increase (decrease) in income before income taxes:
Amount $ (5,718) $ (15,077) $ 18,220 $ (2,575) $ 20,230 $ 17,655
Percent (10.4) % (15.2) % 40.5 % (1.3) % (63.7) % 10.5 %
Retail Banking
For the three months ended March 31, 2026, income before income taxes for the Retail Banking segment decreased $5.7 million, or 10.4%, compared to the first three months of 2025. The decrease in income before income taxes was due to an increase in non-interest expense of $4.9 million, or 5.9%, and a decline in net interest income of $2.7 million, or 2.1%. These decreases to income were partly offset by a decline in the provision for credit losses of $979 thousand, or 9.6%, and an increase in non-interest income of $833 thousand, or 3.6%. Non-interest expense increased over the same period in the previous year mainly due to higher data processing and software costs and allocated support costs (mainly online banking, ATM and other non-branch support costs). Net interest income declined due to lower loan interest income of $2.0 million and lower net
allocated funding credits assigned to the Retail Banking segment's loan and deposit portfolios of $1.0 million. The increase in non-interest income was mainly due to growth in deposit account fees (mainly overdraft and return items fees) and mortgage banking revenue. The decrease in the provision for credit losses from the first three months of 2025 was mainly due to lower auto loan net charge-offs.
Commercial
For the three months ended March 31, 2026, income before income taxes for the Commercial segment decreased $15.1 million, or 15.2%, compared to the same period in the previous year. This decrease was mainly due to higher non-interest expense, an increase in the provision for credit losses, and lower non-interest income, slightly offset by higher net interest income. Non-interest expense increased $8.9 million, or 8.5%, mainly due to higher legal fees, salaries and benefits expense and allocated service and support costs for commercial sales, credit administration and bank operations. The provision for credit losses increased $5.2 million, mainly due to a business real estate loan charge-off on a single senior living loan in the current year. Non-interest income decreased $1.4 million, or 2.0%, mainly due to a decrease in gains on the sales of assets, partly offset by higher deposit account fees (mainly corporate cash management fees). Net interest income increased $335 thousand, or .3%, mainly due to lower interest expense on deposits and customer repurchase agreements of $4.5 million and $3.9 million, respectively. These increases to income were largely offset by lower loan interest income of $6.7 million and lower allocated funding credits of $1.3 million.
Wealth
Wealth segment pre-tax profitability for the three months ended March 31, 2026 increased $18.2 million, or 40.5%, over the same period in the previous year. The increase was mainly due to the FineMark acquisition. Net interest income increased $24.0 million, or 108.1%, mainly due to a $38.3 million increase in loan interest income. This increase was partly offset by a $9.3 million increase in deposit interest expense and a $4.5 million decrease in net allocated funding credits. Non-interest income increased $16.2 million, or 25.3%, over the prior year largely due to higher private client and institutional trust fees. Non-interest expense increased $21.9 million, or 53.2%, mainly due to higher salaries and benefits, data processing and software, and occupancy expense. The provision for credit losses decreased $2 thousand from the same period last year.
The Other/Elimination category in the preceding table includes the activity of various support and overhead operating units of the Company, in addition to the investment securities portfolio and other items not allocated to the segments. In accordance with the Company's transfer pricing procedures, the difference between the total provision for credit losses and total net charge-offs/recoveries is not allocated to a business segment and is included in this category. The pre-tax profitability in this category was $20.2 million higher than in the same period last year. Unallocated securities gains were $11.6 million in the first three months of 2026 compared to losses of $7.6 million in 2025. Also, the unallocated provision for credit losses decreased $7.7 million, primarily driven by a decrease in the provision for credit losses on loans, partly offset by an increase in the liability for unfunded lending commitments, which are both not allocated to the segments for management reporting purposes. Net charge-offs are allocated to the segments when incurred for management reporting purposes. The provision for credit losses on loans in the first three months of 2026 was $11.3 million, or $3.7 million lower than net charge-offs. In the comparable period last year, the provision for credit losses on loans was $15.1 million, or $4.3 million higher than net charge-offs, due to an increase in the allowance for credit losses on loans. The allowance for credit losses on loans increased in the current year as a result of the FineMark initial allowance at acquisition of $22.8 million. For the three months ended March 31, 2026, the Company's provision on unfunded lending commitments was a benefit of $323 thousand. Additionally, net interest income and non-interest income increased $9.1 million and $1.3 million, respectively, but were offset by an increase in non-interest expense of $17.1 million.
Impact of Recently Issued Accounting Standards
Income Taxes The FASB issued ASU 2023-09, "Income Taxes (Topic 740) - Improvements to Income Tax Disclosures", in December 2023. The amendments in this Update require additional disclosures regarding the rate reconciliation and income taxes paid. This Update also removed certain existing disclosure requirements. The Company adopted this Update for the year ended December 31, 2025, and applied the new disclosures on a retrospective basis.
Purchased Loans The FASB issued ASU 2025-08 "Financial Instruments - Credit Losses (Topic 326): Purchased Loans" in November 2025. This new guidance makes significant changes to the accounting for certain acquired seasoned loans subject to the current expected credit loss model (CECL). Under the ASU, the initial allowance for credit losses recorded upon the acquisition of loans in scope is recognized as an adjustment to the amortized cost basis of the loan - similar to the model for purchased credit deteriorated assets. For these loans, the "day-one" credit loss estimate does not impact earnings immediately but is instead amortized over time as an adjustment to interest income. Subsequent changes in the allowance for credit losses are reported in earnings within credit loss expense. The ASU is effective for fiscal periods beginning after December 15, 2026 and interim periods within. Early adoption is permitted and amendments are to be applied prospectively. The Company adopted this Update on January 1, 2026.
Income Statement Reporting The FASB issued ASU 2024-03, "Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses" in November 2024. The amendments in this Update require new disclosures providing further detail of a company's income statement expense items. This Update is effective for annual periods beginning January 1, 2027, and interim periods beginning January 1, 2028. Early adoption is permitted. The amendments in this Update should be applied on a prospective basis. Other than the inclusion of additional disclosures, the adoption is not expected to have a significant effect on the Company's consolidated financial statements.
Internal-Use Software Development Costs The FASB issued ASU 2025-06, "Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Targeted Improvement to the Accounting for Internal-Use Software" in September 2025. The amendments in this Update are intended to modernize the accounting for internal-use software by eliminating references to software development project stages, making the guidance neutral to various development methodologies, including those currently in use and those that may be developed in the future. This Update is effective for annual and interim periods beginning after December 15, 2027. Early adoption is permitted as of the beginning of an annual reporting period. The amendments may be applied on a prospective, modified retrospective or full retrospective basis. The adoption is not expected to have a significant effect on the Company's consolidated financial statements.
Derivatives and Hedging The FASB issued ASU 2025-09 "Derivatives and Hedging (Topic 815): Hedge Accounting Improvements" in December 2025. The amendments in this Update make targeted improvements to hedge account intended to better align financial reporting with an entity's risk-management activities. At a high level, the Update provides for a broader application of grouping forecasted transactions in cash flow hedges by replacing 'same risk exposure' requirements with a more flexible 'similar risk exposure' standard, which may apply to the Company's current cash flow hedges. This Update is effective for annual and interim periods beginning after December 15, 2026. Early adoption is permitted in an interim or annual reporting period. The amendments should be applied on a prospective basis for all hedging relationships, and the Company may elect to adopt the amendments for existing hedging relationships as of the adoption, without dedesignating the hedges. The Company is currently evaluating the provisions of this Update.
Interim Reporting The FASB issued ASU 2025-11 "Interim Reporting (Topic 270): Narrow-Scope Improvements" in December 2025. The amendments in this Update are intended to clarify interim disclosure requirements and the applicability of Topic 270. The ASU is effective for interim periods within annual periods beginning after December 15, 2027. Early adoption is permitted and amendments may be applied prospectively or retrospectively to prior periods presented. The Company does not anticipate a significant impact on the Company's consolidated financial statements.
AVERAGE BALANCE SHEETS - AVERAGE RATES AND YIELDS
Three Months Ended March 31, 2026 and 2025
First Quarter 2026
First Quarter 2025
(Dollars in thousands)
Average Balance
Interest Income/Expense
Avg. Rates Earned/Paid
Average Balance Interest Income/Expense Avg. Rates Earned/Paid
ASSETS:
Loans:
Business(A)
$ 6,687,131 $ 89,125 5.41 % $ 6,106,185 $ 86,564 5.75 %
Real estate - construction and land 1,592,328 25,888 6.59 1,415,349 25,486 7.30
Real estate - business 4,045,670 57,371 5.75 3,667,833 53,203 5.88
Real estate - personal 4,417,131 52,539 4.82 3,045,876 32,145 4.28
Consumer 2,421,541 37,047 6.20 2,082,360 33,466 6.52
Revolving home equity 611,101 10,981 7.29 358,684 6,425 7.26
Consumer credit card 555,697 17,313 12.64 560,534 18,647 13.49
Overdrafts 7,144 - - 5,860 - -
Total loans 20,337,743 290,264 5.79 17,242,681 255,936 6.02
Loans held for sale 2,361 29 4.98 1,584 23 5.89
Investment securities:
U.S. government and federal agency obligations 3,190,796 28,354 3.60 2,586,944 26,063 4.09
Government-sponsored enterprise obligations 54,800 324 2.40 55,330 328 2.40
State and municipal obligations(A)
709,332 3,675 2.10 804,363 4,072 2.05
Mortgage-backed securities 4,211,068 22,010 2.12 4,788,102 24,615 2.08
Asset-backed securities 1,201,187 11,257 3.80 1,655,701 14,115 3.46
Other debt securities 176,676 1,379 3.17 258,136 1,715 2.69
Trading debt securities(A)
97,801 758 3.14 38,298 469 4.97
Equity securities(A)
50,378 806 6.49 57,028 1,128 8.02
Other securities(A)
250,641 4,208 6.81 233,461 4,519 7.85
Total investment securities 9,942,679 72,771 2.97 10,477,363 77,024 2.98
Federal funds sold 862 7 3.29 2,089 29 5.63
Securities purchased under agreements to resell 850,000 8,455 4.03 788,889 7,418 3.81
Interest earning deposits with banks 2,997,340 27,345 3.70 2,388,504 26,249 4.46
Total interest earning assets 34,130,985 398,871 4.74 30,901,110 366,679 4.81
Allowance for credit losses on loans (201,769) (162,186)
Unrealized gain (loss) on debt securities (630,778) (935,054)
Cash and due from banks 432,047 391,436
Premises and equipment, net 545,461 497,057
Other assets 1,097,030 809,803
Total assets $ 35,372,976 $ 31,502,166
LIABILITIES AND EQUITY:
Interest bearing deposits:
Savings $ 1,301,768 214 .07 $ 1,294,174 167 .05
Interest checking and money market 16,019,323 58,343 1.48 13,906,827 52,236 1.52
Certificates of deposit of less than $100,000 1,035,130 8,083 3.17 991,826 8,932 3.65
Certificates of deposit of $100,000 and over 1,465,168 12,098 3.35 1,363,655 13,319 3.96
Total interest bearing deposits 19,821,389 78,738 1.61 17,556,482 74,654 1.72
Borrowings:
Federal funds purchased $ 141,888 $ 1,280 3.66 128,340 $ 1,384 4.37
Securities sold under agreements to repurchase 2,674,484 15,780 2.39 2,723,227 19,224 2.86
Other borrowings 90,796 869 3.88 616 1 .66
Total borrowings 2,907,168 17,929 2.50 2,852,183 20,609 2.93
Total interest bearing liabilities 22,728,557 96,667 1.72 % 20,408,665 95,263 1.89 %
Non-interest bearing deposits 7,874,488 7,298,686
Other liabilities 423,998 421,370
Equity 4,345,933 3,373,445
Total liabilities and equity $ 35,372,976 $ 31,502,166
Net interest margin (FTE) $ 302,204 $ 271,416
Net yield on interest earning assets 3.59 % 3.56 %
(A) Stated on a fully taxable-equivalent basis using a federal income tax rate of 21%.
Commerce Bancshares Inc. published this content on May 07, 2026, and is solely responsible for the information contained herein. Distributed via EDGAR on May 07, 2026 at 19:31 UTC. If you believe the information included in the content is inaccurate or outdated and requires editing or removal, please contact us at [email protected]