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CBSH beat Q2 earnings and revenue estimates, driven by higher net interest and non-interest income.
Commerce Bancshares posted sequential loan growth, while deposits declined from the prior quarter.
Higher expenses and credit loss provisions weighed on CBSH's results to some extent.
Shares of Commerce Bancshares Inc. (CBSH - Free Report) gained 1.7% following the release of its second-quarter 2026 results. Second-quarter earnings of $1.10 per share surpassed the Zacks Consensus Estimate of $1.04. The bottom line reflected a rise of 1% from the prior-year quarter.
Results primarily benefited from higher net interest income (NII) and a rise in non-interest income. The sequential rise in loan balances acted as a tailwind. However, higher expenses and provisions hurt the results to some extent.
Net income attributable to Commerce Bancshares was $159.8 million, up 4.8% year over year. Our estimate for the metric was $145.2 million.
CBSH’s Revenues Improve, Expenses Rise
Total revenues were $498.9 million, up 11.9% year over year. The top line outpaced the Zacks Consensus Estimate of $488 million.
NII was $315.1 million, rising 12.5% from the year-ago quarter. Net yield on interest-earning assets was 3.77%, increasing 7 basis points (bps) year over year. Our estimates for NII and net yield on interest-earning assets were $302.8 million and 3.62%, respectively.
Non-interest income was $183.8 million, up 11% year over year. The rise was mainly driven by higher trust fees, deposit account charges and other fees, consumer brokerage services fees, and bank card transaction fees. Our estimate for non-interest income was $176.5 million.
Non-interest expenses increased 21.5% year over year to $297.1 million. The rise was due to an increase in all cost components. We had projected expenses of $287.9 million.
Investment securities gains were $12.8 million, significantly up from the prior-year quarter.
The efficiency ratio increased to 58.40% from 54.77% in the year-ago quarter. A rise in the efficiency ratio indicates a deterioration in profitability.
CBSH’s Loans Rise Sequentially But Deposits Fall
As of June 30, 2026, net loans were $20.64 billion, up 1.9% from March 31, 2026. Total deposits were $27.88 billion, down 1.8% sequentially. Our estimates for net loans and total deposits were $20.51 billion and $28.74 billion, respectively.
Commerce Bancshares’ Asset Quality: A Mixed Bag
Provision for credit losses was $8.7 million, up 56% from the prior-year quarter. Our estimate for the metric was $12.4 million.
The allowance for credit losses on loans to total loans was 0.94% on June 30, 2026, unchanged year over year.
However, non-accrual loans to total loans were 0.06% at the quarter-end, down from 0.11% in the year-ago quarter. The ratio of annualized net loan charge-offs to average loans was 0.19%, down from 0.22% in the prior-year quarter.
CBSH’s Capital Ratios Improve, Profitability Ratios Decline
As of June 30, 2026, the Tier I leverage ratio was 12.81%, up from 12.75% in the year-ago quarter. Tangible common equity to tangible assets ratio increased to 11.39% from 10.86% in the prior-year quarter.
In the reported quarter, return on total average assets was 1.84%, down from 1.95% in the year-ago quarter. Return on average equity was 14.70% compared with 17.40% in the prior-year quarter.
CBSH’s Share Repurchase Update
In the reported quarter, the company purchased 2.1 million shares of treasury stock at an average price of $53.03.
Our Take on Commerce Bancshares
In June, CBSH announced plans to acquire Nolan & Associates, which will expand its capital markets-related capabilities. Along with this, the FineMark buyout (which is expanding the wealth platform and lifting trust fees), solid growth in loans, a diversified fee mix and balance sheet repositioning will continue to aid the company’s top line. However, rising expenses and weak asset quality remain near-term headwinds.
Commerce Bancshares, Inc. Price, Consensus and EPS Surprise
The Bank of New York Mellon Corporation’s (BNY - Free Report) second-quarter 2026 adjusted earnings of $2.46 per share handily surpassed the Zacks Consensus Estimate of $2.20. The bottom line increased 26.8% from the year-ago quarter.
BNY’s results primarily benefited from a rise in fee revenues and NII. Also, the company recorded a provision benefit in the quarter, which was a tailwind.
Bank of America’s (BAC - Free Report) second-quarter 2026 earnings of $1.21 per share handily surpassed the Zacks Consensus Estimate of $1.13. The bottom line grew 34.4% year over year.
BAC recorded an improvement in trading numbers for the 17th straight quarter. The company’s investment banking performance was solid this time as well. These, along with higher NII, drove Bank of America’s total revenues. While provisions declined in the quarter on a year-over-year basis, non-interest expenses increased, which hurt the results to some extent.
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CBSH Stock Gains on Q2 Earnings Beat, Revenues & Costs Rise Y/Y
Key Takeaways
Shares of Commerce Bancshares Inc. (CBSH - Free Report) gained 1.7% following the release of its second-quarter 2026 results. Second-quarter earnings of $1.10 per share surpassed the Zacks Consensus Estimate of $1.04. The bottom line reflected a rise of 1% from the prior-year quarter.
Results primarily benefited from higher net interest income (NII) and a rise in non-interest income. The sequential rise in loan balances acted as a tailwind. However, higher expenses and provisions hurt the results to some extent.
Net income attributable to Commerce Bancshares was $159.8 million, up 4.8% year over year. Our estimate for the metric was $145.2 million.
CBSH’s Revenues Improve, Expenses Rise
Total revenues were $498.9 million, up 11.9% year over year. The top line outpaced the Zacks Consensus Estimate of $488 million.
NII was $315.1 million, rising 12.5% from the year-ago quarter. Net yield on interest-earning assets was 3.77%, increasing 7 basis points (bps) year over year. Our estimates for NII and net yield on interest-earning assets were $302.8 million and 3.62%, respectively.
Non-interest income was $183.8 million, up 11% year over year. The rise was mainly driven by higher trust fees, deposit account charges and other fees, consumer brokerage services fees, and bank card transaction fees. Our estimate for non-interest income was $176.5 million.
Non-interest expenses increased 21.5% year over year to $297.1 million. The rise was due to an increase in all cost components. We had projected expenses of $287.9 million.
Investment securities gains were $12.8 million, significantly up from the prior-year quarter.
The efficiency ratio increased to 58.40% from 54.77% in the year-ago quarter. A rise in the efficiency ratio indicates a deterioration in profitability.
CBSH’s Loans Rise Sequentially But Deposits Fall
As of June 30, 2026, net loans were $20.64 billion, up 1.9% from March 31, 2026. Total deposits were $27.88 billion, down 1.8% sequentially. Our estimates for net loans and total deposits were $20.51 billion and $28.74 billion, respectively.
Commerce Bancshares’ Asset Quality: A Mixed Bag
Provision for credit losses was $8.7 million, up 56% from the prior-year quarter. Our estimate for the metric was $12.4 million.
The allowance for credit losses on loans to total loans was 0.94% on June 30, 2026, unchanged year over year.
However, non-accrual loans to total loans were 0.06% at the quarter-end, down from 0.11% in the year-ago quarter. The ratio of annualized net loan charge-offs to average loans was 0.19%, down from 0.22% in the prior-year quarter.
CBSH’s Capital Ratios Improve, Profitability Ratios Decline
As of June 30, 2026, the Tier I leverage ratio was 12.81%, up from 12.75% in the year-ago quarter. Tangible common equity to tangible assets ratio increased to 11.39% from 10.86% in the prior-year quarter.
In the reported quarter, return on total average assets was 1.84%, down from 1.95% in the year-ago quarter. Return on average equity was 14.70% compared with 17.40% in the prior-year quarter.
CBSH’s Share Repurchase Update
In the reported quarter, the company purchased 2.1 million shares of treasury stock at an average price of $53.03.
Our Take on Commerce Bancshares
In June, CBSH announced plans to acquire Nolan & Associates, which will expand its capital markets-related capabilities. Along with this, the FineMark buyout (which is expanding the wealth platform and lifting trust fees), solid growth in loans, a diversified fee mix and balance sheet repositioning will continue to aid the company’s top line. However, rising expenses and weak asset quality remain near-term headwinds.
Commerce Bancshares, Inc. Price, Consensus and EPS Surprise
Commerce Bancshares, Inc. price-consensus-eps-surprise-chart | Commerce Bancshares, Inc. Quote
Currently, Commerce Bancshares carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Other Banks
The Bank of New York Mellon Corporation’s (BNY - Free Report) second-quarter 2026 adjusted earnings of $2.46 per share handily surpassed the Zacks Consensus Estimate of $2.20. The bottom line increased 26.8% from the year-ago quarter.
BNY’s results primarily benefited from a rise in fee revenues and NII. Also, the company recorded a provision benefit in the quarter, which was a tailwind.
Bank of America’s (BAC - Free Report) second-quarter 2026 earnings of $1.21 per share handily surpassed the Zacks Consensus Estimate of $1.13. The bottom line grew 34.4% year over year.
BAC recorded an improvement in trading numbers for the 17th straight quarter. The company’s investment banking performance was solid this time as well. These, along with higher NII, drove Bank of America’s total revenues. While provisions declined in the quarter on a year-over-year basis, non-interest expenses increased, which hurt the results to some extent.