Common Stock

9 Months Ended

Sep. 30, 2020

Common Stock *

Presented below is a summary of the components used to calculate basic and diluted income per share. The Company applies the two-class method of computing income per share, as nonvested share-based awards that contain nonforfeitable rights to dividends are considered securities which participate in undistributed earnings with common stock. The two-class method requires the calculation of separate income per share amounts for the nonvested share-based awards and for common stock. Income per share attributable to common stock is shown in the table below. Nonvested share-based awards are further discussed in Note 13.


	For the Three Months Ended September 30				For the Nine Months Ended September 30
(In thousands, except per share data)	2020		2019		2020		2019
Basic income per common share:
Net income attributable to Commerce Bancshares, Inc.	$	132,448	$	109,242	$	224,168	$	314,351
Less preferred stock dividends	7,466		2,250		11,966		6,750
Net income available to common shareholders	124,982		106,992		212,202		307,601
Less income allocated to nonvested restricted stock	1,173		1,040		1,996		2,996
Net income allocated to common stock	$	123,809	$	105,952	$	210,206	$	304,605
Weighted average common shares outstanding	110,720		112,982		110,848		114,475
Basic income per common share	$	1.12	$	.93	$	1.90	$	2.65
Diluted income per common share:
Net income available to common shareholders	$	124,982	$	106,992	$	212,202	$	307,601
Less income allocated to nonvested restricted stock	1,170		1,039		1,993		2,991
Net income allocated to common stock	$	123,812	$	105,953	$	210,209	$	304,610
Weighted average common shares outstanding	110,720		112,982		110,848		114,475
Net effect of the assumed exercise of stock-based awards - based on
the treasury stock method using the average market price for the respective periods	179		267		209		284
Weighted average diluted common shares outstanding	110,899		113,249		111,057		114,759
Diluted income per common share	$	1.11	$	.93	$	1.89	$	2.65

Unexercised stock appreciation rights of 394 thousand and 378 thousand for the three month periods ended September 30, 2020 and 2019, respectively, and 281 thousand and 351 thousand for the nine month periods ended September 30, 2020 and 2019, respectively, were excluded from the computation of diluted income per common share because their inclusion would have been anti-dilutive.

On September 1, 2020, the Company redeemed all outstanding shares of its 6.00% Series B Non-Cumulative Perpetual Preferred Stock, $1.00 par value per share (Series B Preferred Stock) and the corresponding depositary shares representing fractional interests in the Series B Preferred Stock (Series B Depositary Shares). The 6,000,000 depositary shares, each representing a 1/1,000th interest in a share of Series B Preferred Stock, were redeemed simultaneously with the redemption of the Series B Preferred Stock at a redemption price of $25 per depositary share. Regular dividends on the outstanding shares of the Series B Preferred Stock were paid separately on September 1, 2020 to all holders of record as of August 14, 2020, in the customary manner, and future dividends ceased to accrue. For the nine month period ended September 30, 2020, preferred stock dividends totaled $12.0 million, and included $5.2 million related to the preferred stock redemption, which is the excess of the redemption costs over the book value of the preferred stock.

* All prior year share and per share amounts in this note have been restated for the 5% common stock dividend distributed in December 2019.