Delivering on Our Promise

2 0 0 6 A N N U A L R E P O R T A N D F O R M 10 - K
Delivering on Our Promise
Growing Relationships Through Personalized Service
C O M PA N Y P R O F I L E
Commerce Bancshares, Inc. operates as a supercommunity bank offering an array of sophisticated
financial products delivered with high-quality,
personal customer service. The company’s customer
promise ask listen solve is not just its brand, but
also its corporate focus. With this platform, Commerce
is continually building its long-term franchise while
paying strict attention to asset quality and expense
management. Commerce provides a full range of
financial products to consumer and commercial
customers including: lending, payment processing,
trust, brokerage and capital markets services.
Serving its customers from approximately 350
locations in Missouri, Kansas and Illinois with
regional calling efforts in 10 other states,
Commerce uses a variety of delivery platforms
including an expansive ATM network, full-featured
online banking and a central contact center.
FIVE KEY MARKETS
• Largest independent bank in the lower Midwest
1. Kansas City
• $15 billion in assets
2. St. Louis
• Super-community bank
3. Peoria/Bloomington
• 354 locations
4. Springfield
• 4,932 full-time equivalent (FTE) employees
5. Wichita
• 87% of the company’s profitability comes from five
key markets including Kansas City; St. Louis; Peoria/
Bloomington, Illinois; Springfield, Missouri; and
Wichita, Kansas
Branch Footprint
Extended Market Area
MARKET STABILIT Y
Commerce is a company that values employees,
customers and shareholders while striving to produce
consistent, solid returns. Commerce Bancshares
reported its 16th consecutive year of earnings per
share growth in 2006. Over the last 10 years, the average annual shareholder return on the company’s stock
has been 12% compared to the S&P 500’s performance
of 8%. In December 2006, Commerce paid its 13th
consecutive 5% stock dividend. In February 2007, the
Board of Directors approved a 7% increase in the cash
dividend rate per share over the fourth quarter, making
it the 39th consecutive year of cash dividend increases.
TABLE OF CONTENTS
Financial Highlights 1
Message to Our Shareholders 2
Community Advisors 17
Engaging Our Employees 9
Officers and Directors 22
COMMERCE B ANCSHARES, INC. 2006 ANNUAL REPORT
1
FINANCIAL HIGHLIGHTS
$ 60
$3.50
$ 50
$3.00
$2.50
$ 40
$2.00
$ 30
$1.50
$ 20
$1.00
$ 10
$ 0
Earnings per Share
Stock Price
GROW TH in EARNINGS PER SHARE
and STOCK PRICE
$0.50
97
98
99
00
01
02
Earnings per Share
04
05
06
$0.00
Stock Price
2002
(In thousands, except per share data)
03
2003
2004
2005
2006
operating results
Net interest income
Provision for loan losses
Non-interest income
Non-interest expense
Net income
Cash dividends
$
499,965
34,108
280,572
458,200
196,310
42,185
$
502,392
40,676
301,667
472,144
206,524
51,266
$
497,331
30,351
326,931
482,769
220,341
61,135
$
501,702
28,785
341,199
496,522
223,247
63,421
$
513,199
25,649
361,621
525,425
219,842
65,758
at year end
Total assets
Loans, net of unearned income
Investment securities
Deposits
Stockholders’ equity
Non-performing assets
Common shares outstanding*
$ 13,308,415
7,875,944
4,275,248
9,913,311
1,422,452
29,539
81,475
$ 14,287,164
8,142,679
5,039,194
10,206,208
1,450,954
33,685
78,593
$ 14,250,368
8,305,359
4,837,368
10,434,309
1,426,880
18,775
75,254
$ 13,885,545
8,899,183
3,770,181
10,851,813
1,337,838
11,713
70,989
$ 15,230,349
9,960,118
3,496,323
11,744,854
1,442,114
18,223
69,953
other financial data
(based on average balances)
Return on total assets
Return on stockholders’ equity
Loans to deposits
Equity to assets
Net yield on interest earning assets (T/E)
Tier 1 capital ratio
Total capital ratio
Leverage ratio
Efficiency ratio
Wtd. average common shares outstanding – diluted*
1.58%
14.42
79.29
10.97
4.39
12.67
14.05
10.18
58.62
83,947
1.52%
14.27
79.96
10.68
4.04
12.31
13.70
9.71
58.83
81,163
1.56%
15.19
78.71
10.25
3.81
12.21
13.57
9.60
59.16
78,350
1.60%
16.19
81.34
9.87
3.89
12.21
13.63
9.43
59.30
74,089
1.54%
15.96
84.73
9.68
3.92
11.25
12.56
9.05
60.55
71,122
per share data
Net income – basic*
Net income – diluted*
Market price*
Book value*
Cash dividends*
Cash dividend payout ratio
* Restated for the 5% stock dividend distributed December 2006.
$
2.37 $
2.34
32.32
17.46
.509
21.78%
2.58
$
2.54
42.35
18.46
.642
25.19%
2.85 $
2.81
45.53
18.96
.795
28.26%
3.05 $
3.01
49.64
18.85
.871
28.92%
3.13
3.09
48.41
20.62
.933
30.19%
COMMERCE B ANCSHARES, INC. 2006 ANNUAL REPORT
2
David W. Kemper, Chairman
To Our Shareholders
In 2006, Commerce Bancshares increased earnings per share 3% to $3.09 per
share, while return on assets and return on equity remained strong at 1.54%
and 16.0%, respectively. Although earnings per share growth was lower than
in past years, we continued to strengthen our market position as the leading
super-community bank in our communities. Our payment systems and
money management businesses continued to grow, while credit loss levels
were excellent. Average loan growth was 10%, but industry-wide competition
on loan and deposit spreads put pressure on our net interest income. Fee
income constituted 41% of total revenue.
Our consistent, solid performance is a direct result of engaged
employees building lasting relationships with our customers through
highly personalized service. Our super-community banking format
stresses superior service to our customers, sophisticated products and
intimate knowledge of our markets. Embraced by our customers,
this successful format allows us to compete effectively in our markets, which have seen both significant consolidation as well as new
entrants over the past few years.
Overcapacity remains in the banking system. During 2006,
several mid-sized banks in St. Louis and Kansas City were acquired
by large out-of-state bank franchises. At the same time, 14 new banks
were chartered within Missouri, Kansas and Illinois. The country’s
five largest banks now control 36% of domestic deposits and continue
to use their technology and pricing strengths to compete. With
excellent customer and employee satisfaction measurements, however,
the super-community service model continues to take business from
both national and community banks.
COMMERCE B ANCSHARES, INC. 2006 ANNUAL REPORT
3
$ 1000
$ 900
$ 800
$ 700
$ 600
$ 500
$ 400
$ 300
$ 200
$ 100
$
0
$15.00
$12.00
$ 9.00
$ 6.00
Revenue per Share
Total Revenue in Millions
GROW TH in REVENUE
and REVENUE PER SHARE
$ 3.00
$ 0.00
97
98
Net Interest Income
99
00
01
02
03
Non-Interest Income
04
05
06
Revenue per Share
• Fees from our bankcard businesses grew nicely in 2006. Debit
card and commercial credit card transaction fees grew by 18%
Following are highlights of our financial and business accomplishand 22%, respectively.
ments over the past year.
• Credit quality remained strong, with
• Over the past 10 years, Commerce
net charge-offs totaling 0.28% of average
Bancshares’ stock price has had a compounded
loans, compared with 0.38% in 2005. Nonannual growth rate of 10%, while earnings
performing assets also remained at low levels.
per share have grown in excess of 9%. The
• During the year, Commerce paid cash
average annual shareholder return on the
dividends of $0.93 per share, an increase of
company’s stock has been 12% compared to
7%. It was the 38th consecutive year in
the S&P 500’s performance of 8% over the
which dividends increased; we also paid our
same period. This performance resulted from
13th consecutive 5% stock dividend.
consistent control of credit costs, focused
• Underscoring our solid financial results,
strategies to generate revenue and constant
Commerce was ranked No. 2 among the
control over expenses. While earnings per
150 top-performing U.S. banks in the fourth
share grew by only 3% in 2006, we made
quarter 2006 issue of Bank Director magazine.
numerous investments in our company
The magazine’s Bank Performance Scorecard
that should position us to continue strong
measures financial institutions across three
long-term earnings performance.
Commerce
Bancshares
was
ranked
No.
2
important categories: profitability, capitaliza• During 2006, average loans grew 10%.
of the 150 top-performing banks
tion and asset quality.
The economies in the markets we serve
in the Bank Director fourth quarter 2006 issue.
remained solid all year, and we saw good
demand for business, lease, commercial real estate, consumer and
OUR OPERATING ENVIRONMENT
bankcard lending products.
Overcapacity continues to drive consolidation throughout the
• Average deposits grew by 6%, or almost $600 million, as
banking industry, resulting in intense competition. In the 10 years
Commerce was able to increase new customer relationships and
between 1995 and 2005, the number of banks in the United States
minimize reliance on expensive wholesale funding sources.
decreased 25%, while the number of branch locations increased 29%.
• During the year, we acquired certain assets and assumed certain
As a result of ongoing consolidation, the 10 largest banks generated
liabilities comprising the banking business of Boone National Savings
approximately two-thirds of the industry’s 2005 net income. This
and Loan Association, thus increasing our presence in the Columbia,
trend is equally pronounced in Commerce’s primary operating
Missouri market. We also completed our acquisition of West Pointe
territory, where the number of banks dropped 22% over this same
Bancorp, Inc. in Belleville, Illinois. In late 2006, we announced plans
10-year period and the number of branches climbed 43%.
to acquire South Tulsa Financial Corporation in Tulsa, Oklahoma, a
The past year was particularly challenging for all financial
market where we have significant business, but no physical presence.
institutions. A relatively flat yield curve made it difficult to earn a
PERFORMANCE HIGHLIGHTS
COMMERCE B ANCSHARES, INC. 2006 ANNUAL REPORT
4
CASH DIVIDENDS PER SHARE
Dividends per Share
$ 1.00
$ 0.80
$ 0.60
$ 0.40
$ 0.20
$ 0.00
00
01
02
satisfactory return on lending activities. The rise in short-term rates
on consumer deposits and the competitive commercial loan market
squeezed profit margins throughout the industry. Price wars
developed, especially for retail deposits, and the commoditization
of consumer loans increased.
Against this backdrop of challenging industry and economic
dynamics, Commerce enjoys a number of unique strengths that
clearly differOur super-community entiate us in
banking platform allows us to the marketplace and give
effectively balance small bank us considerable
customer service and community competitive
advantage.
knowledge with larger bank Commerce
product offerings and pricing. is the largest
independent
bank in the lower Midwest, enabling us to support our products
and services with substantial resources. Our super-community
banking platform allows us to effectively balance small bank
customer service and community knowledge with larger bank
product offerings and pricing. We are actively engaged with our
customers in the communities we serve, which better equips us to
identify customer opportunities and to reduce risks. Our flat, nimble
organization supports quick decision making. Our super-regional
positioning, meanwhile, enables us to offer a comprehensive array
of sophisticated products at competitive costs and is supported by
established customer service platforms.
Another key to sustained growth is our proven ability to generate revenue from diverse sources. Our fee businesses, especially
bankcard, commercial services and trust, clearly distinguish us from
our peer regional banks that generate most of their revenue from
interest margin activities. These fee businesses continue to grow
03
04
05
06
and contribute significantly to our overall increase in net income. In
2006, fees accounted for 41% of total revenue, up from 37% just five
years ago. Commercial fees, including cash management and bankcard fees, experienced especially strong growth this past year, with
revenue from our commercial non-lending products growing 15%
and accounting for 45% of total revenue across that line of business.
At Commerce, our traditional focus on organic growth within
our markets continues to be our top priority as we invest and
expand. Complementing this organic growth, we next carefully
consider selected acquisitions as a means of supporting and consolidating key markets.
Our branch-building program remains robust as we expand
within our growing markets. In 2006, we added five new branches
in existing markets and performed significant renovations to three
others. We ended 2006 with 204 branch locations, and we plan to
add five more branches in 2007. Our top priority for our branches is
higher productivity and sales through our existing system, especially
in payment systems and small-business products. We also continue to
develop alternative delivery channels to meet customer expectations,
such as strategically placed ATMs, improved online banking channels
and better customer support. Last year alone, we added 29 new
ATM locations. We now have 400 ATMs across our company,
including 150 convenient off-site locations. This includes 118
full-service, deposit-taking units that cost-effectively expand our
strong branch-based distribution system across our markets.
We continue to emphasize development of our key operating
markets. Currently, 87% of the company’s profitability is produced
in our five primary markets – St. Louis, Kansas City, Peoria
and Bloomington, Illinois, Wichita, Kansas and Springfield,
Missouri. Our markets continue to be stable with solid, balanced
economic growth.
While focusing on our existing markets, we also target
appropriate regional expansion as a driver of continued growth.
COMMERCE B ANCSHARES, INC. 2006 ANNUAL REPORT
5
T O TAL L OANS and DEPOSIT S
$ 12
In Billions
$ 10
$ 8
$ 6
$ 4
10-year compound
growth rate:
■ Loans = 6%
■ Deposits = 4%
$ 2
$ 0
00
01
02
Total Loans
Major markets such as Denver, Nashville, Cincinnati, Tulsa and
Des Moines offer us opportunities to expand our presence in areas
where we already are generating significant business through our
regional calling efforts.
Since 1991, Commerce has acquired 26 banks in Missouri,
Kansas and Illinois, each with a focus on extending our markets.
During 2006, we closed on two key acquisitions and announced
a third that is strategically designed to enhance our operations in
existing markets. In September 2006, we completed the acquisition
of West Pointe Bancorp, Inc., the largest and strongest independent
bank in St. Clair County, Illinois, adding $509 million in assets,
$255 million in loans and $382 million in deposits. This acquisition
added five full-service branch locations to our growing network in
the Metro East region of St. Louis, enhancing our ability to target the
area’s approximately 47,650 households and 3,900 small businesses,
and raising total St. Louis area deposits to $4 billion.
In July 2006, we purchased the banking business and certain
assets of 108-year-old Boone National Savings and Loan Association,
which expanded our presence in the Central Missouri region and
improved our deposit market share position in Columbia, Missouri
from fifth to third place. The transaction added $126 million in
loans, $101 million in deposits and four branch locations. Columbia
is home to the University of Missouri. We also will open a bank in
2007 in Champaign, Illinois near the University of Illinois, as we
believe the economic and demographic outlooks for major university
towns are excellent.
In December 2006, we announced a merger agreement to
acquire South Tulsa Financial Corporation, parent company of
Bank South. This acquisition will add approximately $124 million
in assets, $107 million in loans, $101 million in deposits and two
branch locations in Tulsa, Oklahoma. The addition of Bank South
will enable us to establish banking locations in a market where we
already have numerous commercial banking relationships, providing
03
04
05
06
Total Deposits
a platform for future growth. We anticipate this transaction to be
completed in the second quarter of 2007.
We continue to invest in advanced technology to enhance our
information and operating systems, and to remain competitive. Over
each of the last five years, we have budgeted an average of $24 million
to support this critical initiative. The installation of a new Internetbased phone system reduced our overall telecommunication expense
by 22% in 2006
for a savings of
During the year, Commerce
$2.7 million.
paid cash dividends of $0.93 per
Also, we greatly
share, an increase of 7%. It was
expanded
the 38th consecutive year in
our systems
which dividends increased; we
capabilities
with upgrades
also paid our 13th consecutive
to our deposit,
5% stock dividend.
loan, check
processing and image exchange systems. In addition, we added
enhancements to our voice response and online banking platforms.
LEVERAGING OUR HUMAN CAPITAL
Our people represent a differentiating advantage in a competitive
environment. We seek to be the employer of choice, and we continue
to invest heavily in developing our people and nurturing our culture.
Over the last five years, we have spent, on average, approximately
$3 million per year in employee training and development. At
Commerce, we strongly believe that engaged employees understand
our corporate objectives and, as a result, will enhance our customers’
banking experience. When fully engaged, employees are connected
to and accountable for company goals, which we believe ultimately
translates into strong bottom line results. Each year, we survey
our employees, measuring their engagement, their pride in working
for Commerce, their concern for the company’s future and their
COMMERCE B ANCSHARES, INC. 2006 ANNUAL REPORT
6
PERCENT NON-PERFORMING ASSET S TO L OANS
0.50%
0.40%
0.30%
0.20%
0.10%
0.00%
97
98
99
00
01
views of the workplace environment. In 2006, our employee engagement results improved to an 87% favorable rating, up from 78% and
83% in 2004 and 2005, respectively. That compares to a bank industry norm of 72%. High employee engagement reduces turnover and
increases operating efficiency.
At Commerce, our overriding mission is to build relationships
with our cusEmployees are connected tomers by being
to and accountable for accessible and
company goals, which we offering solutions. Our focus
believe ultimately translates on relationship
into strong bottom line results. banking, distinguished by high
customer service and competitive products, gives us a competitive
advantage. As our customers increasingly conduct their banking
electronically and visit our branches less frequently, growing these
relationships is more critical than ever. To gauge how well we
achieve this goal, we continue to measure customer satisfaction
through frequent surveys. The results suggest we are succeeding in
serving our customers. In our branches, we have achieved improved
satisfaction scores for five consecutive years.
We continue to retain experienced, seasoned banking professionals
in all the markets we serve and believe this is a key ingredient of our
banking strategy and relationship-building efforts. By combining
local market and customer knowledge with strong banking expertise,
our banking professionals are in a great position to deliver the best
combination of service, solutions and products to our customers.
OVERVIEW OF OPERATIONS
Payment Systems
Our payment systems business, a core segment and key driver of
fee revenue growth, accounted for $587 million, or 68%, of our total
02
03
04
05
06
2006 revenues. We have invested heavily in recent years in this
business, which encompasses a broad range of services, including fees
from deposit account transactions, fees from credit and debit card
transactions, merchant processing and sophisticated commercial
treasury services. Currently, retail operations account for approximately two-thirds of all payment systems fees, with the remaining
one-third derived from commercial activities. Over the past five
years, payment systems fees from our retail and commercial business
lines have generated compounded annual growth of 6% and
15%, respectively.
Commerce continues to enhance its position as a leading
provider of card-based solutions, with our steady growth underscored by industry rankings. According to The Nilson Report’s 2005
rankings of the largest U.S. commercial bankcard issuers, Commerce
users ranked 24th largest overall in total volume. We were also
ranked as the fourth largest fleet card issuer, 10th largest purchasing
card issuer, eighth largest prepaid commercial card issuer, 15th
largest corporate card issuer, 25th largest small-business credit card
issuer and 27th largest small-business debit card issuer.
Beginning in September 2005, we launched a major initiative
to significantly grow our commercial card business, with a five-year
target to generate $31 million in annual revenue. By year-end 2006,
we had achieved 132% of our 2006 new account sales goal for sales
volume under contract.
Industry-wide, electronic channels continue to expand to
support the payment systems needs of consumers who seek greater
convenience, speed and security, and businesses that demand
improved payment solutions. Nationally, the number of checks
written continues to decline, while ACH, credit card and debit
card volumes steadily increase. At Commerce, online banking
transactions have grown from 1% to 30% of total monthly customer
transactions since 1999, and customer visits to our website have
increased from approximately 59,000 hits per month to more than
COMMERCE B ANCSHARES, INC. 2006 ANNUAL REPORT
7
ANNUALIZED T O TAL SHAREHOLDER RETURN
15%
12%
9%
6%
3%
0%
3 Year
5 Year
Commerce Bancshares, Inc.
2.5 million over the same period. Today, 70% of our monthly
transactions are electronic.
LENDING AND RISK MANAGEMENT
Demand for commercial-type loans remained strong in 2006, with
loan balances growing 16% over the previous year to $6 billion at
year-end. Commercial loans include business, business real estate,
construction, leasing and tax-exempt lending products, all of which
experienced solid growth in 2006. Many of our customers in the
Midwest are small businesses that seek an array of products and a
high level of customer service. Commerce places emphasis on and
has continued to generate solid growth in this market segment. In
2006, small-business loan commitments grew 47%, while outstandings
grew by 50%. Personal loans also grew in 2006. Average personal
loans, including consumer loans (e.g., automobiles, recreational
vehicles and boats), home equity loans and student loans increased
4% during the year. Average credit card balances and consumer
loans increased 7% and 9%, respectively. With interest rates rising
in 2006, our
Commerce continues to fixed-rate
enhance its position as a leading home equity
loans proved
provider of card-based solutions,
popular with
with our steady growth under- our retail
scored by industry rankings. customers,
and outstandings grew 53%. Commerce has been making student loans for
more than 40 years and currently ranks as the country’s 32nd largest
originator of student loans, according to a leading business magazine
for higher education.
Risk management continues as a critical ingredient of our management culture, and the consistent application of prudent policies
and practices has resulted in strong credit quality. For 2006, our ratio
10 Year
S&P 500
of non-performing assets to total loans was less than 0.20%, compared to industry averages which exceeded 0.50%. At year-end, our
loan loss reserve was 341% of non-performing assets, plus loans over
90 days and
still accruing
Many of our customers in the
interest.
Midwest are small businesses
Net chargethat seek an array of products
offs for the
and a high level of customer
year were
service. Commerce places
$26 million,
or 0.28% of
emphasis on and has continued
average total
to generate solid growth in
loans. Over
this market segment.
the last five
years, our
annual net charge-offs averaged 0.39%, versus approximately 0.85%
for the 100 largest banks.
Money Management
Currently, our money management businesses account for 11%
of revenue, compared to 6% at our peer bank competitors, and
provide 11% of pre-tax profit. With individual household wealth
predicted to grow, our capital markets and trust businesses are
well positioned to capture an increasing share of this opportunity.
The Wall Street Journal, in its “Mutual Funds Quarterly Review –
Category Kings” listing, recognized two Commerce funds for outstanding performance during the year. The Commerce Large-Cap
Growth Fund ranked ninth among 712 comparable funds with a
10% one-year total return, and the Commerce Mid-Cap Growth
Fund finished sixth among 600 similar funds with a one-year total
return of 13%.
In 2006, the profit margin at The Commerce Trust Company
(a division of Commerce Bank, N.A., a Missouri charter) was
COMMERCE B ANCSHARES, INC. 2006 ANNUAL REPORT
8
enhanced to 35%, a key measure of success. Over the last five years,
our trust business has achieved revenue growth of 14% at a compounded annual rate of 3%. Over that same period, its contribution
to company profitability grew a total of 18% at a compounded annual
rate of 3%. At year-end, The Commerce Trust Company held total
client assets of
Our consistent, solid $21 billion, an
performance is a direct result increase of 8%
over 2005.
of engaged employees building
Our private
lasting relationships with our banking initiacustomers through highly tive, where
personalized service. experienced
bankers trained
in complex personal finance and investing strategies work directly
with affluent customers, continues to grow. In the last five years, the
profit contribution of our private banking business doubled to $19
million. As one of our selected growth segments, this unit is targeted
to grow by 10% annually over the next four years. In 2006, private
banking loans grew 12% over the prior year to $591 million.
OUTLOOK FOR 2007
The economic outlook for the coming year currently is for slower
economic growth and reduced consumer demand. A flat interest rate
yield curve and competitive pressures will continue to stress bank
interest rate margins. Fee income growth, credit quality and expense
control will be a key focus for us to maintain earnings per share
growth in 2007. Our retail and commercial business lines, well-diversified and with a high percentage of fee income, should allow us to
continue our earnings growth. We continue to feel that our balanced
business portfolio and high-touch, high-service super-community
banking format will allow us to compete effectively in the highly competitive financial services business. Our key objective continues to
center around building the strongest franchise of competitive products, satisfied customers and engaged employees, which should lead to
sustained long-term earnings per share growth for our shareholders.
David W. Kemper, Chairman
COMMERCE B ANCSHARES, INC. FEBRUARY
21 , 2 0 0 7
COMMERCE B ANCSHARES, INC. 2006 ANNUAL REPORT
9
Engaging Our Employees
Connecting with Our Customers
At Commerce, employee engagement is about being connected and
accountable — to one another and to our customers. We want every
employee at every level throughout the organization to feel personally connected to our end result — staying in the game, remaining
independent and continuing to serve our customers and deliver on
our promise to ask listen solve.
The essence of our employee engagement efforts is simply captured in just six words that employees can understand, relate to and
act on — be accessible, offer solutions, build relationships. Our
continued success in a competitive marketplace is linked to our
success in engaging our employees, encouraging accountability and
connecting with our customers.
Participating in”Big Picture” training are from left: Siva Ramaswamy, business intelligence
analyst; Diane Kroner, employee relations manager; Diana Bentz, senior organizational development consultant; Mark French, contact center supervisor; Jeannie Ford, administrative assistant;
and Corey Cotton, financial services representative.
COMMERCE B ANCSHARES, INC. 2006 ANNUAL REPORT
10
Above: Greg Kendall, vice president,
Business Banking, St. Louis, Missouri
and Katherine Anderson, president
and CEO, Andy’s Seasoning.
Far right: Katherine Anderson
checks packaging in the company’s new
10,000-square-foot warehouse financed
by Commerce Bank. Right: Tim Conway, senior vice
president, Business Banking, St. Louis, Missouri.
The Recipe for Success
ANDY’S SEASONING, INC.
S T. L O U I S , M I S S O U R I
From a small, home-based business
begun in 1981, Andy’s Seasoning has
grown into a nationally known manufacturer of dry breading, batter and
seasoning mixes sold in major supermarket chains and used by restaurants and food processors. In fact,
Andy’s is among the suppliers of
breading used to produce McDonald’s
Chicken McNuggets. President and
CEO Katherine Anderson co-founded
the firm with her late husband and
today presides
over a growing enterprise
with nearly 40
employees,
including her
three sons. Until recently, however,
growth was severely constrained by a
lack of storage space that limited
Andy’s to producing only what could
“Now we’ve positioned ourselves
for bigger growth and better
things in the future.”
be shipped out that same day. Andy’s
Seasoning was then introduced to a
team of Business Banking professionals from Commerce through a referral.
Commerce delivered a financing solution for the much-needed expansion
that doubled the warehouse space and
added an office building. “Commerce
was just what we were looking for,”
Anderson recalls. “They kept us informed throughout the process and
helped us through every phase of the
expansion.” The company also chose
Commerce for all their cash management needs, including working capital.
With assistance from Commerce,
Andy's has all the ingredients for success. “Without financing, we wouldn’t
have been able to do what we’re
doing,” she says. “Now we’ve positioned ourselves for bigger growth
and better things in the future.”
COMMERCE B ANCSHARES, INC. 2006 ANNUAL REPORT
11
The Products to Compete
CRAMER PRODUCTS, INC.
GARDNER, KANSAS
Brothers Chuck and Frank Cramer
co-founded Cramer Products in 1918
and went on to create the entire sports
medicine category. Today, the company’s
athletic tape, braces and supports, cold
therapy and wound care products can
be found in virtually every athletic
training room in the country. “We told
Commerce over the years that we
appreciated their staying in touch and
we were loyal to our existing bank, but
you never know,” recalls Tom Rogge,
Cramer Products president and CEO.
“Well, ‘never know’ time came along
and Commerce responded quickly
and professionally.” Bringing the right
people together, Commerce provided
an innovative solution to finance the
purchase of the remaining stock held
by the founding family, allowing Cramer
Products to become 100% ESOP owned.
Later, when an opportunity to purchase
a competitor emerged, Commerce
“Our relationship with Commerce
is excellent and has exceeded our
expectations.”
Above: Tom Rogge, president and CEO,
Cramer Products, Inc., checks quality
on one of the 10,000 tape rolls Cramer
produces daily. Middle from left: Dennis J.
Katzer, vice president and chief financial
officer, Cramer Products, Inc.; Lance W.
Hart, community bank president, Lenexa,
Kansas; and Tom Rogge. Additional team
members include at bottom from left:
Christopher M. Maliff, vice president,
Institutional Services Group, Kansas City,
Missouri; Bryan J. Smith, vice president,
Institutional Services Group, Kansas City,
Missouri; and Jay Reardon, vice chairman,
Commerce Bank, Kansas City, Missouri.
provided the financing and assisted
company management throughout the
acquisition. Today, the multi-functional
Commerce team from the Lenexa and
Kansas City banks, together with the
Institutional Services group, effectively
handles Cramer Products’ operating
accounts and cash management,
corporate credit cards, international
accounts and manages the 401k plan.
“Our relationship with Commerce
is excellent and has exceeded our
expectations from that first phone
call when I asked, ‘can you help us
out,’” says Rogge.
COMMERCE B ANCSHARES, INC. 2006 ANNUAL REPORT
12
High- Quality Support
for Higher Education
PITTSBURG STATE UNIVERSIT Y
PITTSBURG, KANSAS
Just over a century old, Pittsburg State
University is a comprehensive regional
university that attracts students to its
colleges of arts and sciences, business,
education and technology. A Commerce
team from the Pittsburg bank, together
with support from Regional Marketing
in Springfield, Missouri and the corporate Student Services team, delivers
solutions to meet the needs of the
university and the local community.
Commerce partners with Pitt State
to provide students with free checking
and other banking services via their
student ID card — used to access campus services plus make debit card
purchases and ATM withdrawals. The
card also provides the university with
a secure, cost-effective and paper-less
method to disburse financial aid pay-
“For a university of our size,
friends in the community are
very meaningful to the quality
of the institution.”
Above: Tom W. Bryant, president,
Pittsburg State University, Pittsburg,
Kansas with student Christine Wilson
on the historic Russ Hall stairway.
Middle, from left: Don Becker, student
segment coordinator and marketing officer,
Kansas City, Missouri; Carl Bradbury,
director of student services, St. Louis,
Missouri; Tom W. Bryant; and
Wendell L. Wilkinson, president,
Commerce Bank, Pittsburg, Kansas.
Additional team members include, at
bottom from left: Kimberley Pakitsos,
assistant vice president, branch manager,
Pittsburg, Kansas; Kristie Ellis,
marketing administrator, Pittsburg,
Kansas; and Lisa Allen, senior personal
banking representative, Pittsburg State
University.
ments that also allows quicker access
and more convenience for students.
During the year, Commerce opened
a full-service on-campus branch in the
Overman Student Center, bringing
banking convenience to students, faculty
and staff. “For a university of our size,
friends in the community are very
meaningful to the quality of the institution,” explains Dr. Tom Bryant, Pitt
State president. “Commerce has always
been willing to step up and support the
university, and that partnership has
been instrumental in helping us keep
the quality of education at the level
we want.”
COMMERCE B ANCSHARES, INC. 2006 ANNUAL REPORT
13
A Culture of Excellent
Customer Service
T- M O B I L E U S A , I NC .
SPRINGFIELD, MISSOURI
T-Mobile USA dominates the wireless
industry in the area of customer service, consistently
earning the highest rankings for
customer care
and satisfaction.
Opened in 2006,
T-Mobile’s newest
inbound customer
service call center will eventually
handle as many as 8 million calls a
year. When your business is customer
service, that’s exactly what you look
for in a banking relationship – and
T-Mobile found it with Commerce.
Initially, T-Mobile wanted a fully operational ATM on-site when the center
opened, and Commerce assembled a
team to make it happen. “Commerce
really put their customer promise to
the test here,”
says Mark
Conrad, call
center general
manager.
“They asked
what we needed
and our timeframe, and came up with a solution.
We were the first site at T-Mobile to
ever get an ATM in by the time the
“They asked what
we needed and our
timeframe, and came
up with a solution.”
Top: Dee Ann Thompson, manager, Human
Resources, T-Mobile USA, Springfield, Missouri,
has T-Mobile’s top-performing customer service team
behind her. Above right: Kody Brandt, branch
manager, Kansas Expressway Banking Center; and
Dee Ann Thompson.
physical structure was finished.” Since
then, the Commerce banking team in
Springfield, together with the Private
Banking group, has collaborated on a
package of banking services tailored
for T-Mobile employees, as well as
private banking options for senior
management. “Commerce went out
of their way to establish a relationship
up front, which is very important in
the T-Mobile culture,” he explains.
“They were intently focused on us as
a part of the community, rather than
just as a customer.”
Additional team members in Springfield include, from left: Sheri J. Shaffer,
vice president, Private Banking Group; John M. Cox, executive vice president,
Retail Administration; Nichole Goddard, vice president, Retail Group manager;
and Karen Favor, assistant vice president, Retail Sales manager.
COMMERCE B ANCSHARES, INC. 2006 ANNUAL REPORT
14
Employing a
Visionary Approach
ALPHAPOINTE
K A N S A S C I T Y, M I S S O U R I
Founded in 1911, Alphapointe is the
only comprehensive rehabilitation
and education center for the blind and
visually impaired in Missouri. With its
primary mission to teach skills and
provide employment opportunities,
the agency puts people to work in the
community and also ranks as the
state’s largest employer of the blind
and visually impaired. Alphapointe
is 90% self-sufficient, manufacturing
“Commerce brings to the table
the diversity of expertise and
resources of a large financial
institution.” 8 million pens and nearly 50 million
Above: Daniel E. Walker, Ph.D. president and CEO, Alphapointe with Elizabeth Goudeau. Below, clockwise from
left: Harold L. Johnson, vice president, Business Banking, Kansas City, Missouri with Daniel E. Walker; additional team
members Linda S. Goodwin, vice president, Institutional Services Group, Kansas City, Missouri; Staci Nichols, assistant
vice president, account executive, Merchant Bank Card, Kansas City, Missouri; Donald E. Sullivan, CFA, senior vice
president, Commerce Capital Advisors, Kansas City, Missouri; and Gayle Gauert, vice president, regional sales manager,
Merchant Bank Card, Kansas City, Missouri.
pharmaceutical prescription and
specimen bottles a year for various
agencies of the federal government.
For over a dozen years, The Commerce
Trust Company has effectively managed
Alphapointe’s “rainy day” investment
fund, giving the nonprofit agency an
added income stream to support its
efforts. Building on this relationship,
Commerce professionals from Business Banking and Merchant Bank
Card recently teamed up to earn the
agency’s merchant bank card business.
The Commerce team delivered an
innovative solution that eliminated
excessive non-qualified transaction
fees — reducing the cost by one-third
and saving the agency over $100,000
annually. “Commerce brings to the
table the diversity of expertise and
resources of a large financial institution,” explains Daniel Walker,
Alphapointe’s president and CEO,
“but our relationship remains very
personal. They’re always reachable
and responsive, and have delivered
on every promise they’ve given us.”
COMMERCE B ANCSHARES, INC. 2006 ANNUAL REPORT
15
Focus on Growth
BRANDT CONSOLIDATED, INC.
PLEASANT PL AINS, ILLINOIS
Brandt Consolidated is a leading
manufacturer and distributor of liquid
and dry fertilizers, proprietary micronutrients and adjuvants, and specialty
chemicals, primarily for the agribusiness and turf industries. The more
than 50-year-old, family-owned company
operates 10 production plants in
Central Illinois. Working across lines
of business, a Commerce team that
includes the Agribusiness group in
Illinois and Kansas City, plus the
international team and executives in
St. Louis, worked together to support
Brandt’s growth with a range of
deposit and cash management services,
international accounts and a customized credit structure that adjusts
to the seasonality of the business.
The Commerce team has developed
a strong relationship with Brandt
Consolidated’s management by listening to their
specific needs
and delivering
innovative solutions, and, just as
importantly, by
understanding
their business
and industry — drawing on the bank’s
lengthy history and heritage in
agriculture. “Agriculture is a unique
industry and you have to understand
the industry to want to participate
in it,” says Rick Brandt, president
and CEO of the company co-founded
by his father and aunt. “Commerce
understands and is interested in agriculture, as well as understanding and
being interested in us. They’ve been
great to work with and the relationship has been very good for us.”
“Commerce understands and
is interested in agriculture,
as well as understanding and
being interested in us.”
Above: Rick C. Brandt, president
and CEO, Brandt Consolidated, directs
the growth of his family’s business.
Left: Steven F. Sebade, senior vice
president, Agribusiness and Food
Processing Group, Bloomington,
Illinois with Rick C. Brandt.
Additional team members, at right from
top: Jack Schreiber, president and
chief operating officer, St. Louis region;
Paul R. Toskin, vice president and
manager, U.S. and Foreign Trade
Services, St. Louis, Missouri; and
Lance Holden, senior vice president,
Agribusiness and Food Processing
Group, Kansas City, Missouri.
COMMERCE B ANCSHARES, INC. 2006 ANNUAL REPORT
16
Delivering Value-Added
Products
BUNGE NORTH AMERICA
S T. L O U I S , M I S S O U R I
Bunge North America buys, stores
and transports grain and oilseed
crops produced by growers, then
transforms these commodities into
the value-added ingredients the
world’s food and feed processors need,
and produces food products that touch
consumers’ lives every day. Bunge also
is the largest corn miller in North
America and a primary supplier of
high-quality, specialized food and feed
ingredients and food products to the
global marketplace. Bunge sought to
forge a local, hometown banking relationship with a bank that understood
their agricultural commodity business.
Over the years, Commerce has met
their needs with a range of Treasury
Management solutions, including lock
box and payroll services, as well as
purchasing cards and working lines of
credit. More recently, the relationship
expanded to Trust Services when
Bunge expressed a need regarding
custodial services for their pension
plans. The Commercial officer introduced Bunge to a team of experts
within The Commerce Trust Company
who listened carefully, then offered a
solution to meet their needs. Commerce
earned the confidence of Bunge’s
financial officers and, as a result, now
serves as the Trustee for the company’s
defined benefit plans — holding plan
assets, settling trades for the plans’
investment managers and generating
monthly checks for pensioners. “As a
commodity company with thin margins,
cost efficiencies are extremely important in everything we do, particularly
administrative services,” says Michael
Scharf, Bunge’s senior vice president
and CFO. “We seek to contribute to
our growth by focusing on our process
to control costs, and we know that
Commerce is there to help us.”
“We seek to contribute to our
growth by focusing on our process
to control costs, and we know that
Commerce is there to help us.”
Above: William M. “Bill” Gross, Jr., vice president, Bunge North America, manages the world’s largest corn mill.
Below from left: Jeff Potts, vice president, senior relationship manager, St. Louis, Missouri; John Bascio, vice president,
senior relationship manager, Institutional Trust Services, St. Louis, Missouri; John P. Gilsinn, treasurer, Bunge North
America, St. Louis, Missouri; Michael M. Scharf, senior vice president and CFO, Bunge North America, St. Louis,
Missouri; and Kathryn A. Clifford, assistant treasurer, Bunge North America, St. Louis, Missouri.
COMMERCE B ANCSHARES, INC. 2006 ANNUAL REPORT
17
COMMUNIT Y ADVISORS
A fundamental element of Commerce Bank’s super-
fabric of the market. Local civic and business leaders,
community strategy is the role of our Community
serving as Community Advisors, provide the insight
Advisors. We believe that a deep understanding and
to local needs that ensures Commerce delivers on its
a close relationship with the communities we serve
promise. Following are the names of these ambassa-
can be achieved only when we are interwoven in the
dors within each of our markets.
Missouri
BARRY COUNT Y
Donald Cupps
Ellis, Cupps & Cole
William A. Easley, Jr.
Retired, Commerce
Bank, N.A.
JoAnne Ellis
Retired Educator
John Henbest
Farmer
Phil Hutchens
Hutchens Construction
Ed Peterson
Century 21-Peterson Real Estate
John Layton
Layton and Southard, LLC
Dr. Mike Lutz
Mike Lutz, DDS
EASTERN JACK SON
Dr. C. Pat Taylor
Southwest Baptist University
Todd Petzoldt
East Perry Lumber Company
David A. Machens
Machens Enterprises
R. D. Vestal
Vestal Equipment Co., Inc.
Roger Tolliver
Commerce Bank, N.A.
Teresa Maledy
Commerce Bank, N.A.
Kevin G. Barth
Commerce Bancshares, Inc.
Commerce Bank, N.A.
BRANSON
Allen Toole
Cape Electrical Supply, Inc.
Jim McRoberts
McRoberts Farms, Inc.
Michael E. Uhls
MJLJ, LLC
Mike Petrie
Commerce Bancshares, Inc.
Commerce Bank, N.A.
Patrick Cox
State Park Marina
Scott Earls
The Vacation Channel
Mike McCracken
Commerce Bank, N.A.
Joe Ficarra
Ficarra Asset Management,
Inc.
Eugene Miekley
Miekley and Cupps,
DVM Office
Kevin Gerard
Country Mart
Fred Osborn
Commerce Bank, N.A.
Mike Petrie
Commerce Bancshares, Inc.
Commerce Bank, N.A.
John Himmel
Commerce Bank, N.A.
Rob Johns
Commerce Bank, N.A.
CENTRAL MISSOURI
Mike Alden
University of Missouri
Dan Atwill
Atwill & Montgomery,
Attorneys
Morris F. Burger
Burger’s Country Cured
Hams
Brad Clay
Commerce Bank, N.A.
CAPE GIRARDEAU
Gary Hawkins
Hawkins, Shipley, Mitchell
& Company
James Schatz
Commerce Bank, N.A.
Robert Hormann
Durvet, Inc.
Valerie Shaw
Commerce Bank, N.A.
Kim Lingle
MBL Development
Steve Sowers
Commerce Bank, N.A.
Mark Martin
Space Center - Kansas City
Col. C. R. Stribling, III
Missouri Military Academy
Gary McClure
Lakewood Oaks Golf Club
James Orr
Mechanical Breakdown
Protection, Inc.
Jerry Watley
Able 2 Products Co.
David F. Dormeyer
Prudential Bridgeport Inc.,
Realtors
Gregg E. Hollabaugh
Commerce Bancshares, Inc.
Ken Tebow
Commerce Bank, N.A.
Ron Hopkins
Commerce Bank, N.A.
Mel Toellner
Gold Crest Distributing
& Songbird Station
Jannis Keeling
Keeling Accounting &
Financial Services
Alan Gregory
Gregory Construction, Inc.
Craig Lehman
Shelter Insurance Agency
Robert Moreland
Commerce Bank, N.A.
Gregg E. Hollabaugh
Commerce Bancshares, Inc.
Mike Kasten
Kasten Farms
Richard R. Kennard
Coad Chevrolet, Inc.
Coad Toyota Mitsubishi
George M. Huffman
Pearl Motor Company
Dr. Evelyn Jorgenson
Moberly Area Community
College
Jack W. Knipp
Knipp Enterprises
Rick Kruse
Retired, Boone National
Savings & Loan Assoc.
Jay E. Dorst
Commerce Bank, N.A.
Jim Rolls
Associated Electric
Cooperative
Joe Hartman
Retired, Commerce
Bank, N.A.
W. Cliff Ford
Ford & Sons
Funeral Home, Inc.
Jim Denning
Discover Vision Centers
Todd E. Gafney
Commerce Bank, N.A.
William H. Bess II
Bluff City Beer Co.
John Himmel
Commerce Bank, N.A.
Jerry Campbell
CEAH Realtors
Robert K. Pugh
MBS Textbook Exchange
Keith Shumaker
Shumaker Tire, Inc.
B O L I VA R
COUNTY
David Orscheln
Ortran, Inc. / OIX, Inc.
Jack Waters
Tribune Publishing Co.
Edward J. Reardon, II
Commerce Bank, N.A.
Larry Webber
Webber Pharmacy
Kim Roam
Cochran, Oswald, McDonald,
Roam & Moore, PC
Dr. John S. Williams
Horton Animal Hospital
Walter Whisler
Stewart Title
COMMERCE B ANCSHARES, INC. 2006 ANNUAL REPORT
18
Missouri Continued
HANNIBAL
C. Todd Ahrens
Hannibal Regional Hospital
David M. Bleigh
Bleigh Construction
Company and Bleigh Ready
Mix Company
John C. Grossmeier
Hannibal Regional Hospital,
Hannibal Regional Healthcare
System, Hannibal Regional
Physician Hospital
Organization
Gregg E. Hollabaugh
Commerce Bancshares, Inc.
Jim Humphreys
Luck, Humphreys and
Associates, CPA, PC
Jerold (Jerry) W. Lee
Commerce Bank, N.A.
Lee A. Steinman
C & S Companies Inc.
HARRISONVILLE
JOPLIN
Stan Cox
O & F Machine
David C. Humphreys
TAMKO Roofing
Products, Inc.
Fannun A. Kanan
Canaan Land Development
Dr. Richard E. LaNear
Missouri Southern State
University
Barbara J. Majzoub
Yorktown Properties
Fred S. Osborn
Commerce Bank, N.A.
Mike Petrie
Commerce Bancshares, Inc.
Commerce Bank, N.A.
Peter B. Ramsour
Able Products, Inc.
Russell G. Smith, II
MYRUSH Futures
Investment Properties
Robert W. Atkinson
Retired
KANSAS CITY
Connie Aversman
Commerce Bank, N.A.
Kevin G. Barth
Commerce Bancshares, Inc.
Commerce Bank, N.A.
Larry Dobson
Real Estate Investments
Elvin S. Douglas, Jr.
Crouch, Spangler & Douglas
Martin E. Ismert
Schier Plumbing
William James
Inland Newspaper
Machinery Corp.
Richard Lloyd
Commerce Bank, N.A.
Scott Milner
G.R. Milner Ford
Laurence Smith
Reece & Nichols Smith Realty
Clay C. Blair, III
Clay Blair Services Corp.
John O. Brown
Retired, Commerce
Bancshares, Inc.
Lee A. Derrough
Hunt Midwest
Enterprises, Inc.
Earl H. Devanny, III
Cerner Corporation
Stephen D. Dunn
J.E. Dunn Construction
Co., Inc.
C. L. William Haw
National Farms, Inc.
Jonathan M. Kemper
Commerce Bancshares, Inc.
Commerce Bank, N.A.
POPL AR BLUFF
Bill R. Brandt
Commerce Bank, N.A.
Larry Cotrell
Cotrell Funeral Chapel
David Kiersznowski
DEMDACO
Luther P. Godwin
Ozark Ridge Golf Course
John N. McConnell
Labconco Corporation
Bob Greer
John M. Greer Construction Co.
Dennis A. Mullin
Steel & Pipe Supply
Company, Inc.
Gregg E. Hollabaugh
Commerce Bancshares, Inc.
Karen L. Pletz, J.D.
Kansas City University of
Medicine and Biosciences
Edward J. Reardon, II
Commerce Bank, N.A.
Jerry D. Reece
Reece & Nichols
Edward J. Schifman
Veco Holdings, LLC
Ladd M. Seaberg
Midwest Grain Products, Inc.
Charles S. Sosland
Sosland Publishing Company
Thomas R. Willard
Tower Properties
Susan S. Witcher
Faultless Laundry
Company, Inc.
Hugh J. Zimmer
Zimmer Companies
James P. McLane
McLane Livestock
Transport, Inc.
Samuel P. Spain
Spain Merrell & Miller
Austin Tinsley, IV
Ozark Physical Therapy
Roger Tolliver
Commerce Bank, N.A.
Ben Traxel
Dille and Traxel LLC
S T. J O S E P H
Robert J. Brown, Jr.
Robert J. Brown Lumber
Company
Scott Burnham
CBIZ, BCK&W Insurance
Services
James H. Counts
Attorney at Law
LEB ANON
Richard N. DeShon
Artesian Ice & Cold Storage
Jerry N. Benson
Retired, Commerce
Bank, N.A.
Pat Dillon
Dillon Company
Hugh V. Corry
Hardware Electric &
Plumbing Supply Company
Brian Esther
Commerce Bank, N.A.
Lester M. Evans
Cattleman
John Himmel
Commerce Bank, N.A.
Harold Storck
Cattleman
Dan M. Waterman
CPA
Karen M. Graves
Civic Leader
Pete Gray
Gray Automotive
Products Co.
Edward J. Reardon, II
Commerce Bank, N.A.
P. Gordon Robaska
Civic Leader
Judy Sabbert
Heartland Foundation
Steve Schram
Agri-Laboratories Ltd.
Bradley D. Scott
Commerce Bank, N.A.
Emil H. Sechter
Commerce Bank, N.A.
S T. L O U I S M E T R O
Douglas A. Albrecht
Centric Group
Charles L. Drury, Jr.
Drury Hotels
Todd Epsten
Major Brands, Inc.
Joseph Forshaw, IV
Forshaw of St. Louis
James G. Forsyth, III
Moto, Inc.
Juanita Hinshaw
H & H Advisors
Donald A. Jubel
Spartan Light Metal Products
David W. Kemper
Commerce Bancshares, Inc.
Alois J. Koller Jr.
Koller Enterprises, Inc.
Kristopher G. Kosup
Buckeye International, Inc.
Seth M. Leadbeater
Commerce Bancshares, Inc.
Commerce Bank, N.A.
John B. Morgan
Subsurface Constructors, Inc.
Victor L. Richey, Jr.
ESCO Technologies, Inc.
William J. Hurley
Smurfit/Stone Container
Corporation
Jerome M. Rubenstein
Bryan Cave, LLP
Mike Petrie
Commerce Bancshares, Inc.
Commerce Bank, N.A.
Steven F. Schankman
Contemporary Productions,
LLC
James E. Schiele
St. Louis Screw & Bolt Co.
COMMERCE B ANCSHARES, INC. 2006 ANNUAL REPORT
19
Missouri Continued
John (Jack) A. Schreiber
Commerce Bank, N.A.
Gregory B. Vatterott
Charles F. Vatterott &
Company
Kansas
Lisa D. McLaughlin
Lewis, Rice & Fingersh, L.C.
Richard C. Mueller, Jr.
Bopp Funeral Chapel
Earl E. Walker
Carr Lane Manufacturing Co.
Howard Nimmons
Howard A. Nimmons
CPA, P.C.
Kelvin R. Westbrook
Millennium Digital Media
Carl A. Rausch
Lutheran Senior Services
S T. L O U I S
Greg W. Schmittgens
Humes & Barrington, LLP
METRO EAST
William Courtney
Helitech Concrete and
Structure
David Embry
C-Mac
Mona Haberer
Hortica
Scott Lively
Granim, Medler, Childers &
Hoering, P.C.
James Rauckman
Rauckman High Voltage
Sales LLC
Dr. James T. Rosborg
McKendree College
Gary Rueter
Greensfelder, Hemker & Gale
Terry W. Schaefer
Retired, Commerce
Bank, N.A.
Dr. Ed Szewezyk
Szewezyk K. Edward J. M.D.
Eye Physicans & Surgeons
of Belleville
S T. L O U I S
CENTRAL/NORTH
Cyrus Blackmore
Blackmore & Glunt, Inc.
Herbert (Herb) S. Jones
Messenger Printing &
Publishing, Inc.
Daniel Leach
P.M. Leach Painting
Company
Stephen Mattis
Allied Industrial
Equipment Corporation
Don Zykan
IESI Solid Waste Services
S T. L O U I S S O U T H
Maria C. Albano, M.D.
Physician
Michael D. Allen
Rock Community Fire
District
Phillip J. Amato
Lorillard
Thomas E. Muzzey
One Call Concrete
Construction, Inc.
Louis J. Naeger
Louis J. Naeger & Associates
Lee Thurman
Thurman, Shinn
and Company
S T. L O U I S E A S T
Tino DiFranco
Tropicana Bowling Lanes
J. L. (Juggie) Hinduja
Sinclair Industries, Inc.
Myron J. Klevens
Restaurant Consulting, Inc.
Patrick N. Lawlor
Lawlor Corporation
McGraw Milhaven
Talk Show Host - KTRS
Dennis Scharf
Scharf Tax Services
Richard C. Ward
Development Strategies, Inc.
S T. C H A R L E S
COUNTY
John M. McGuire
St. Charles
Community College
Peter J. Mihelich, Jr.
Goellner Promotions
Duane A. Mueller
Cissell Mueller Construction
Company
Tarlton J. Pitman
Pitman Funeral Home, Inc.
S T. L O U I S W E S T
David Ross
Barnes-Jewish St. Peters
Hospital
Richard K. Brunk
Attorney at Law
Brenda Wetter Witte
Hackmann Lumber Company
James N. Foster
McMahon, Berger, Hanna,
Linihan, Cody & McCarthy PC
William J. Zollmann, III
Attorney at Law
Jack Hoffmann
Milestone Solutions
Richard E. Hrabko
Spirit of St. Louis
Airport, Inc.
Stuart Krawll
Beam of St. Louis, Inc.
Jim Shubert
Shubert Design
Lawrence J. Siegel
Hochschild, Bloom
& Co., LLP
Bill Voss
American Family Insurance
SPRINGFIELD
Roger Campbell, Jr.
Campbell Ford-Mercury, Inc.
Kenneth L. Carter
Rankin Company
John Cox
Commerce Bank, N.A.
Lester B. Cox
Modern Tractor &
Supply Co.
Steve Eoff
D & E Plumbing & Heating
BUTLER COUNTY
Karen Garwitz
Hoffman Supply Company
Eugene S. Adams
Retired
Joe C. Greene
Husch & Eppenberger, LLP
Ray L. Connell
Connell & Connell
Bunch Greenwade
G & H Contractors,
LLC / Rancher
Mark Utech
Commerce Bank, N.A.
Robert A.
Hammerschmidt, Jr.
Commerce Bank, N.A.
John Himmel
Commerce Bank, N.A.
Seth M. Leadbeater
Commerce Bancshares, Inc.
Commerce Bank, N.A.
Mary Kay Meek
Try-Meek, Inc.
Alvin D. Meeker
Commerce Bank, N.A.
James F. Moore
Investments
Robert B. Murray, Jr.
R. B. Murray Company
Keith Noble
Commerce Bank, N.A.
Richard Ollis
Ollis & Company Insurers
Mike Petrie
Commerce Bancshares, Inc.
Commerce Bank, N.A.
B. Glenn Robinson
Grand Country Square
(EL
DORADO)
Dr. Jackie Vietti
Butler Community College
COLUMBUS
Jay Hatfield
Jay Hatfield Chevrolet
Wesley C. Houser
Retired, Commerce
Bank, N.A.
Don Kirk
H & K Campers
Charles Norris
Investments
Fred Osborn
Commerce Bank, N.A.
Mike Petrie
Commerce Bancshares, Inc.
Commerce Bank, N.A.
Jane Rhinehart
Commerce Bank, N.A.
Darrel Shumake
Attorney at Law
GARDEN CIT Y
Richard Harp
Commerce Bank, N.A.
Caverly Hart
The Finnup Foundation
Dr. Gloria Hopkins
Fry Eye Associates
Dennis Kleysteuber
Kleysteuber-Gillen Inc.
Dr. Tom Koksal
Plaza Medical
Dr. Grant Larkin
Grant Larkin, DDS
COMMERCE B ANCSHARES, INC. 2006 ANNUAL REPORT
20
Kansas Continued
Stewart Nelson
GMCN Architects
Mike Petrie
Commerce Bancshares, Inc.
Commerce Bank, N.A.
Lee Reeve
Reeve Cattle Company
Itzel Rodriguez
Transition/HEP Coordinator
Garden City Community
College
Archie Rooney
Rooney Agri Business
Adam F. Steven
Commerce Bancshares, Inc.
Pat Sullivan
Sullivan Analytical
Service, Inc.
Bob Tempel
WindRiver Grain, LLC
Craig Wheeler
Commerce Bank, N.A.
INDEPENDENCE
J. Dan Carroll
Yerkes & Michels CPA, LLC
John E. Heckman
Heckman & Associates
James P. Kelly
Commerce Bank, N.A.
William L. (Larry) O’Malley
O’Malley Equipment
Company
Fred S. Osborn
Commerce Bank, N.A.
William M. (Marty)
Reichenberger
Green Thumb
Greenhouse, Inc.
Paul H. Viets
Commerce Bank, N.A.
Julie L. Voelker
Commerce Bank, N.A.
Raymond H. Woods
Woods Lumber Company
Craig W. Patterson
Eskridge, Inc.
Greg Prieb
Greg Prieb Homes, Inc.
Edward J. Reardon, II
Commerce Bank, N.A.
Thomas K. Rogge
Cramer Products
Daniel E. Sight
Sight Commercial
Realty, Inc.
L AW R E NC E
John W. Brand, Jr.
Stevens & Brand, LLP
Martin B. Dickinson, Jr.
Schroeder Professor of Law,
University of Kansas
Sidney A. Garrett
Brown Cargo Van, Inc.
Mark Heider
Commerce Bank, N.A.
Thomas A. Dials
President, Armed Forces
Insurance Exchange
David A. Greenamyre
Besel Heating & Roofing
Stephen J. Kempf
Retired, Armed Forces
Insurance Exchange
Dr. Jeanette Lozenski
Providence/St. John Hospitals
Lawrence W. O’Donnell, Jr.
Lawrence W. O’Donnell, Jr.,
CPA Chartered
Bill Petrie
Commerce Bank, N.A.
Edward J. Reardon, II
Commerce Bank, N.A.
Robert D. Schmitt, II
Mama Mia’s Inc.
Brian Sutton
Commerce Bank, N.A.
Judith A. Westhoff
Retired, Commerce
Bank, N.A.
Rich Jankovich
Commerce Bank, N.A.
Ken Johnson
Retired
Thomas P. Carrico
Gill Studios Inc.
Dan Simons
The World Company
James T. McCullough
McCullough
Development, Inc.
Gail Kuehl
Kuehl Operations
Robert Choun
Metro Air Conditioning Co.
Earnest A. Lehman
Midwest Energy, Inc.
Gordon Docking
St. Joseph Medical Center
Mike Petrie
Commerce Bancshares, Inc.
Commerce Bank, N.A.
Isak Federman
F&G Capital Management
Adam F. Steven
Commerce Bancshares, Inc.
Thomas L. Thomas
Commerce Bank, N.A.
Vance Westhusin
Midland Marketing
Co-op, Inc.
Todd E. Gafney
Commerce Bank, N.A.
Lance W. Hart
Commerce Bank, N.A.
Chris Herre
Rose Construction Co., Inc
Pat Olney
Commerce Bank, N.A.
Norman B. Dawson
Retired, Commerce
Bancshares, Inc.
Sherry DeMaranville
DeMaranville & Kramer
CPAs, LLC
Mark Denney
J.F. Denney Plumbing
& Heating
Roberta A. McNay
Investments
Neal Helmick
Griffith Lumber Co.
Edward J. Reardon, II
Commerce Bank, N.A
William Ferguson
Commerce Bank, N.A.
C. L. Farabi
Pepsi-Cola Bottling
Company of Pittsburg, Inc.
Steve W. Sloan
Midwest Minerals, Inc.
Becky Blades
BladesTrozzolo
Public Relations
J. Sanford Bushman
DeMaranville & Kramer
CPAs, LLC
Adam Endicott
Unique Metal
Fabrication, Inc.
Tom Giller
Commerce Bank, N.A.
Kenneth Havner
Attorney, Havner & Brin
L E AV E N W O R T H
Joe Dellasega
U.S. Awards
Ronald L. Rhodes
Rhodes Grocery, Inc.
Kevin J. O’Malley
O’Malley Beverages of
Kansas, Inc.
Michael Treanor
Treanor Architects, P.A
Harvey R. Dean
Pitsco, Inc.
Bob Cavello
Kansas State University
Kevin G. Barth
Commerce Bancshares, Inc.
Commerce Bank, N.A.
D. G. Bickle, Jr.
Warehouse, Inc.
Dr. Thomas W. Bryant
Pittsburg State University
MANHATTAN
JOHNSON COUNTY
James W. Aubel
A & A Coors
James L. Belew
Investments
Mike Petrie
Commerce Bancshares, Inc.
Commerce Bank, N.A.
Martin W. Moore
Advanco, Inc.
HAYS
PITTSBURG
Mike Petrie
Commerce Bancshares, Inc.
Commerce Bank, N.A.
Dr. Roger P. Reitz
Medical Associates of
Manhattan
Adam F. Steven
Commerce Bancshares, Inc.
Wendell L. Wilkinson
Commerce Bank, N.A.
RENO COUNT Y
(HUTCHINSON)
Vergi Geurian
Pipeline Testing
Consortium, Inc.
Brett Mattison
Decker & Mattison Company
Eleanor G. Stolzer
Griffith Lumber Co.
Dr. Pamela D. Pierce
Reno Pathology
Associates, P.A.
L. W. Stolzer
Griffith Lumber Co.
Mike Ringwald
Farmer (Ellinwood, Kan.)
John Walters
Walters Morgan
Construction, Inc.
Jon H. Starks
Commerce Bank, N.A.
Roy Worthington
Charlson & Wilson
Bonded Abstracters
COMMERCE B ANCSHARES, INC. 2006 ANNUAL REPORT
21
Kansas Continued
Illinois
WICHITA
BL OOMINGTON-
Stanley R. Ahlerich
Rancher / Farming
NORMAL
PEORIA
Mark Arends
Arends Brothers, Inc.
Bruce Alkire
Coldwell Banker Commercial
Devonshire Realty
Al Bowman
Illinois State University
Daniel Altorfer
United Facilities, Inc.
George Farnsworth
Retired
Afton Booth
The Unland Companies
Robert Fleming
Fleming Law Office
Brent Eichelberger
Commerce Bank, N.A.
Ron Greene
AFNI, Inc.
Lowell (Bud) Grieves
Mark Twain Hotels
Ronald Guthoff
Guthoff & Company
Gregg E. Hollabaugh
Commerce Bancshares, Inc.
Gregg E. Hollabaugh
Commerce Bancshares, Inc.
Robert Lakin
Commerce Bank, N.A.
Stephen Hayes
The Hayes Company, Inc.
Parker Kemp
Commerce Bank, N.A.
Ronald W. Holt
Sedgwick County,
Assistant County Manager
Robert Lakin
Commerce Bank, N.A.
Seth M. Leadbeater
Commerce Bancshares, Inc.
Commerce Bank, N.A.
Dr. Donald Beggs
Wichita State University
Michael P. Brown
College Hill OB/GYN
Michael E. Bukaty
Latshaw Enterprises, Inc.
John C. Clevenger
Commerce Bank, N.A.
Monte A. Cook
Commerce Bank, N.A.
Thomas E. Dondlinger
Dondlinger & Sons
Construction Co., Inc.
Fran D. Jabara
Jabara Ventures Group
Seth M. Leadbeater
Commerce Bancshares, Inc.
Commerce Bank, N.A.
Paul D. Jackson
Vantage Point Properties, Inc.
Richard Lenahan
Retired
Tom J. Kemp
Kemp Construction, Inc.
Dennis Myers
Myers, Inc.
Fritz R. Krohmer
Commerce Bank, N.A.
Eugene Striegel
Striegel, Knobloch & Co.
Seth M. Leadbeater
Commerce Bancshares, Inc.
Commerce Bank, N. A.
Douglas D. Neff
Commerce Bank, N. A.
Derek L. Park
Sandcastle Management
Marilyn B. Pauly
Commerce Bank, N.A.
Mike Petrie
Commerce Bancshares, Inc.
Commerce Bank, N.A.
Barry L. Schwan
House of Schwan, Inc.
Clifford W. Stone
Stone Farms
Jennifer L. Stultz
Commerce Bank, N.A.
Thomas D. White
White & Ellis Drilling, Inc.
Stuart L. Levenick
Caterpillar, Inc.
James Maxey, M.D.
Orthopedic Institute
of Illinois
Timothy Shea
Peoria Builders
Jan Wright-Vergon
Central Illinois Business
Publishers, Inc.
COMMERCE B ANCSHARES, INC. 2006 ANNUAL REPORT
22
Officers
David W. Kemper
Chairman of the Board,
President and Chief Executive
Officer
Jonathan M. Kemper
Vice Chairman
Seth M. Leadbeater
Vice Chairman
A. Bayard Clark, III
Executive Vice President and
Chief Financial Officer
Kevin G. Barth
Executive Vice President
Charles G. Kim
Executive Vice President
Robert C. Matthews, Jr.
Executive Vice President
Michael J. Petrie
Senior Vice President
Jeffery D. Aberdeen
Controller
V. Raymond Stranghoener
Executive Vice President
Robert J. Rauscher
Senior Vice President
Wayne McGaugh
Auditor
Sara E. Foster
Senior Vice President
J. Daniel Stinnett
Vice President, Secretary
and General Counsel
Thomas A. McDonnell*
President and Chief Executive
Officer, DST Systems, Inc.
Andrew C. Taylor
Chairman and Chief
Executive Officer, Enterprise
Rent-A-Car Company
Directors
John R. Capps*
President and Chief Executive
Officer, Plaza Motor
Company
W. Thomas Grant, II
Senior Vice President,
Quest Diagnostics, Inc.
James B. Hebenstreit*
President, Bartlett and
Company
* Audit Committee Members
David W. Kemper
Chairman of the Board,
President and Chief Executive
Officer, Commerce
Bancshares, Inc.
Jonathan M. Kemper
Vice Chairman,
Commerce Bancshares, Inc.
Seth M. Leadbeater
Vice Chairman,
Commerce Bancshares, Inc.
Terry O. Meek
President, Meek Lumber
Yard, Inc.
Benjamin F. Rassieur, III*
President, Paulo Products
Company
Kimberly G. Walker
Chief Investment Officer,
Washington University in
St. Louis
Robert H. West*
Retired, Chairman and Chief
Executive Officer, Butler
Manufacturing Company
C O R P O R A T E H E A D Q UA R T E R S
A N N UA L M E E T I N G
1000 Walnut
P.O. Box 419248
Kansas City, MO 64141-6248
(816) 234-2000
www.commercebank.com
The annual meeting of shareholders will be held
Wednesday, April 18, 2007 at 9:30 a.m. in the Kemper
Auditorium on the 15th Floor of the Commerce
Trust Building at 922 Walnut Street, Kansas City, MO
64106.
INDEPENDENT ACCOUNTANT S
INVESTOR INQUIRIES
KPMG LLP
Kansas City, Missouri
Shareholders, analysts and investors seeking information
about the company should direct their inquiries to:
T R A N S F E R A G E N T, R E G I S T R A R A N D
DIVIDEND DISBURSING AGENT
Jeffery D. Aberdeen, Controller
1000 Walnut
P.O. Box 419248
Kansas City, MO 64141-6248
(800) 892-7100
[email protected]
Computershare Trust Company, N.A.
P.O. Box 43069
Providence, RI 02940-3069
(800) 317-4445
(800) 952-9245 TDD
www.computershare.com/equiserve
S H A R E H O L D E R S M AY R E C E I V E F U T U R E
A N N UA L R E P O R T S A N D P R O X Y M A T E R I A L S O V E R
THE INTERNET
S T OCK EXCHANGE LIS TING
NASDAQ
Symbol: CBSH
COMMON ST OCK INFORMATION
To take advantage of the opportunity to receive
materials electronically, rather than by mail, simply fill
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website at: http://www.econsent.com/cbsh.
The table below sets forth the high and the low prices of
actual transactions for the company’s common stock,
which is publicly traded on the NASDAQ Stock Market.
Please note:
• You will need your account number from the proxy
card to complete the enrollment process.
Designed by Falk Harrison Creative, St. Louis, Missouri
FISCAL 2006
First Quarter
Second Quarter
Third Quarter
Fourth Quarter
HIGH
LOW
$50.03
50.67
48.81
50.60
$46.80
46.99
46.30
45.60
• Your consent is entirely revocable.
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COMMERCE B ANCSHARES, INC.
10 0 0 WA L N U T
P. O . B OX 419 2 4 8
K A N S A S C I T Y, M O 6 4141 - 6 2 4 8
Phone: (816) 234-2000
(800) 892-7100
E-mail: [email protected]
Website: www.commercebank.com
An Equal Opportunity Employer MK2906