Commerce Bancshares reports $37M quarterly profit

Kansas City-based Commerce Banschares Inc., the holding company for Commerce Bank, reported improvement in second-quarter profit compared to the first quarter.

Net income for the quarter was $37 million, up from $30.8 million in the first quarter but down from $56 million in second-quarter 2008, according to a July 16 earnings release. Per-share earnings were 48 cents for the quarter, compared to 40 cents per share in the first quarter and 74 cents in second-quarter 2008.

"Although the overall economy remains difficult, we are pleased to report an increase in net income over the previous quarter as a result of growth in net interest income, higher core fees and good expense control," Commerce Chairman and CEO David W. Kemper said in a news release. "This quarter we continued to strengthen our balance sheet by improving liquidity, increasing capital and building our loan loss reserves."

Net interest income grew nearly 9 percent from second-quarter 2008 to $157.4 million. Total average deposits increased $650.9 million, or 4.9 percent.

Commerce's allowance for loan losses increased by $5.1 million to $186 million, representing 1.74 percent of outstanding loans. Nonperforming assets - nonaccrual loans and foreclosed property - grew by $13 million to $131.7 million, or 1.23 percent of loans. The loan-to-deposit ratio was 82 percent for the quarter, reflecting good overall liquidity, Kemper said.

Total assets at June 30 were $17.7 billion, total loans were $11.1 billion and total deposits were $13.7 billion.

Shares (Nasdaq: CBSH) closed Friday at $34.96, compared to a 52-week range of $27.80 to $52.86.