CONTACTS

Vernon W. Hill, II	C. Edward Jordan, Jr.
Chairman and President	Executive Vice President

(856) 751-9000

COMMERCE BANCORP NET INCOME UP 20%

SECOND QUARTER CORE DEPOSITS UP $1.6 BILLION

July 14, 2005 - Cherry Hill, New Jersey - Commerce Bancorp, Inc. (NYSE Symbol: CBH) reported record earnings and increased deposits, assets and loans for the second quarter of 2005, announced Vernon W. Hill, II, Chairman of the multi-bank holding company.

SECOND QUARTER FINANCIAL HIGHLIGHTS
June 30, 2005
			%
			Increase
* Total Assets:	$33.4	Billion	25%
* Core Deposits:	$29.6	Billion	28%
* Total (Net) Loans:	$10.5	Billion	29%
* Total Revenues:	$404.1	Million	20%
* Net Income:	$79.4	Million	20%
* Net Income Per Share:	$ .46		15%

Chairman’s Statement

Vernon W. Hill, II, Chairman, noted the following financial highlights:

·   Net income increased 20% for the second quarter of 2005 to $79.4 million.

·   Earnings per share rose 15% for the second quarter to $.46.

·   Net interest income grew 18% during the second quarter despite margin compression to 3.93% caused by the flattening yield curve.

·   Core deposits grew $1.6 billion to $29.6 billion during the second quarter.

·   Core deposits, excluding time deposits, grew 31% for the prior 12 months.

·   Demand deposits increased 34% over the past year, in line with the Company’s five-year growth rate.

·   Annualized deposit growth per store was $21 million.

·   Comparable Store Core Deposit Growth:

	Two Year	One Year
Total	19%	24%
Excluding Time Deposits	22%	27%

·   Deposit charges and service fees grew 31% year over year.

·   Net loans grew $2.3 billion, or 29%, to $10.5 billion.

·   Book value per share grew 30% over the past year to $11.48.

·   The Company expects to meet or exceed the current First Call E.P.S. consensus projections of $.47 for the third quarter of 2005 and $1.87 for the year.

Expansion Plans

The Commerce growth retail model includes the opening of new stores in both existing and new markets.

Consistent with our goal of increasing our store base 15-20% a year, the Company presently has +/- 140 locations under Agreement in various stages of land use development, including approximately 25 under construction.

The Company opened 7 stores in the first half of the year and will open approximately 45 in the second half of the year for a total new store opening of 50 to 55 in 2005.

2

Metropolitan Washington & Baltimore

The Company began its 200 store expansion plan in Washington/Baltimore with the opening of its first 2 stores, at Connecticut Avenue, Dupont Circle, Washington DC and Manassas, Virginia in the second quarter. Both have received tremendous customer acceptance.

The Company will open an additional 6-8 stores in 2005 and approximately 15-20 stores in 2006, including expansion in the suburban Maryland counties of Washington, Metropolitan Baltimore and Annapolis.

Metropolitan New York

Metropolitan New York is now the Company’s largest market with 181 stores, $16.2 billion in deposits and a 31% annual growth rate.

The Company opened 3 new stores in the first half of 2005 in Metropolitan New York and will open approximately 30 additional new stores in the second half of 2005 including:

•15 stores in New York City and Long Island

•2 stores in Westchester County

•Our first 2 stores in Fairfield County, Connecticut

•15 stores in Northern New Jersey

The Company recently opened its first store in Manhattan’s Chinatown which has received record customer acceptance. On August 5^th, we will open our new New York City headquarters at 42^nd& Madison, together with a location at 109^th& Broadway.

Metropolitan Philadelphia

Metropolitan Philadelphia is our home market where Commerce presently has 143 stores with a 200 store market potential.

The Company opened 2 new stores in the first half of 2005 and will open 6-8 additional stores for the balance of 2005.

The 2006 Metropolitan Philadelphia expansion plan projects 6-10 new store openings.

Lehigh Valley

Commerce is expanding into the Lehigh Valley area of Pennsylvania including the Allentown, Bethlehem and Easton areas.

The Company will open its first office in Bethlehem on July 15, 2005 and expects to have 4 open at the end of 2005 in what will ultimately become a 20 store market.

New Markets

During the third quarter, the Company will announce its next Metropolitan expansion market.

3

Income Statement

	Three Months Ended June 30							Six Months Ended June 30
	2005		2004		% Increase			2005		2004		% Increase
	(dollar in thousands, except per share data)
Total Revenues:	$	404,110	$	337,024		20	%	$	786,700	$	653,468		20	%
Total Expenses:		278,499		226,255		23			536,905		438,505		22
Net Income:		79,409		66,235		20			156,546		128,210		22
Net Income Per Share:	$	.46	$	.40		15	%	$	.91	$	.77		18	%

Balance Sheet

					Linked Quarter
	6/30/05	6/30/04	% Increase	3/31/05	$ Increase	% Increase
	(dollars in millions)
Total Assets:	$33,363	$26,739	25%	$31,870	$1,493	5%
Total Loans (Net):	10,547	8,206	29	9,837	710	7
Core Deposits:	29,625	23,109	28	28,058	1,567	6
Total Deposits:	30,519	24,062	27	29,488	1,031	3

Shareholder Returns

		June 30, 2005
		Commerce	S & P Index
1	Year	12%	6%
5	Years	23%	-2%
10	Years	28%	10%

4

Growth Targets

	Growth Targets			Last 5 Year Growth %			Actual % Second Quarter 2005
Total Deposits:		25	%		38	%		27	%
Two-Year Comp Store Deposits:		18			24			19
Total Revenue:		25			32			20
Net Income:		25			35			20
Earnings Per Share:		20			27			15

Total Deposits

The Company’s deposit growth continues with total deposits at June 30, 2005 of $30.5 billion, a $6.5 billion increase or 27% over total deposits of $24.1 billion a year ago. Core deposits grew $1.6 billion in the second quarter.

	6/30/05		6/30/04		$ Increase		% Increase
	(dollars in millions)
Core Deposits	$	29,625	$	23,109	$	6,516		28	%
Total Deposits	$	30,519	$	24,062	$	6,457		27	%

Regional Deposit Growth

Deposit growth by region is as follows:

# of Stores		6/30/05	6/30/04	$ Increase	% Increase	Average Store Size	Annualized Growth/ Store
	(dollars in millions)

Northern New Jersey	117	$	9,877	$	8,254	$	1,623	20	%	$	84	$	15
New York City	37		3,623		2,534		1,089	43			98		31
Long Island/NY State	27		2,687		1,594		1,093	69			100		50
Metro New York	181	$	16,187	$	12,382	$	3,805	31	%	$	89	$	23
Metro Philadelphia	143	$	14,325		11,680		2,645	23			100		19
Metro Washington	2	$	7		N/A		7	N/	A		N/A		N/A
Total	326	$	30,519	$	24,062	$	6,457	27	%	$	94	$	21

5

Comparable Store Core Deposit Growth

Comparable store deposit growth is measured as the year-over-year percentage increase in core deposits for stores open two years or more at the balance sheet date. Additional information is provided below for stores opened one year or more at the balance sheet date.

At June 30, 2005 the Company had 64 stores in New York State. Of these stores, 28 are included in the comparable store growth for stores open 2 years or more and 49 are included in the comparable store growth for stores open one year or more at the balance sheet date.

	Core Deposit Growth
	Stores Open 2					Stores Open 1
	Years or More					Year or More
	# of Stores		Comp Store Increase			# of Stores		Comp Store Increase
Metro Philadelphia		125		19	%		134		21	%
Northern New Jersey		90		15			106		19
New York City		17		32			31		48
Long Island/NY State		11		25			18		45
Total		243		19	%		289		24	%
Excluding Time Deposits				22	%				27	%

Core Deposits

Core deposit growth by type of account is as follows:

	6/30/05		6/30/04		$ Increase		% Increase			2nd Quarter Cost of Funds
	(dollars in millions)
Demand	$	7,540	$	5,623	$	1,917		34	%		.00	%
Interest Bearing Demand		11,967		9,632		2,335		24			1.78
Savings		7,469		5,387		2,082		39			1.28
Subtotal		26,976		20,642		6,334		31	%		1.17	%
Time		2,649		2,467		182		7			2.41
Total Core Deposits:	$	29,625	$	23,109	$	6,516		28	%		1.28	%

6

Core deposit growth by type of customer is as follows:

	6/30/05		% Total			6/30/04		% Total			Annual Growth %
	(dollars in millions)
Consumer	$	13,250		45	%	$	11,065		48	%		20	%
Commercial		11,179		38			8,402		36			33
Government		5,196		17			3,642		16			43
Total	$	29,625		100	%	$	23,109		100	%		28	%

Government Core Deposits

Government core deposits by state are as follows:

	# of Relationships		6/30/05		Annual Growth Rate			% Total
	(dollars in millions)
New Jersey		663	$	3,214		34	%		62	%
Pennsylvania		191		1,170		61			22
New York		120		812		56			16
Total		974	$	5,196		43	%		100	%

Government core deposits decreased $31.0 million during the second quarter, reflecting cyclical trends in our government deposit business. The Company added 22 government relationships during the second quarter.

7

Net Income and Earnings Per Share

Net income totaled $79.4 million for the second quarter of 2005, up $13.2 million or 20% over net income of $66.2 million for the second quarter of 2004.

On a diluted per share basis, net income for the second quarter was $.46 compared to $.40 for the second quarter of 2004, a 15% increase.

	Three Months Ended							Six Months Ended
	6/30/05		6/30/04		% Increase			6/30/05		6/30/04		% Increase
	(dollars in thousands, except per share data)
Net Income	$	79,409	$	66,235		20	%	$	156,546	$	128,210		22	%
Earnings Per Share	$	.46	$	.40		15	%	$	.91	$	.77		18	%

For the first six months of 2005, net income totaled $156.5 million, up $28.3 million or 22% over net income of $128.2 million for the first six months of 2004.

On a diluted per share basis, net income for the first six months of 2005 was $.91 compared to $.77 for the first six months of 2004, an 18% increase.

Total Revenues

	Three Months Ended							Six Months Ended
	6/30/05		6/30/04		% Increase			6/30/05		6/30/04		% Increase
	(dollars in thousands, except per share data)
Total Revenues	$	404,110	$	337,024		20	%	$	786,700	$	653,468		20	%
Revenue Per Share	$	9.12	$	7.81		17	%	$	8.90	$	7.61		17	%

Net Interest Income and Net Interest Margin

Net interest income for the second quarter totaled $288.5 million, an 18% increase over the $244.7 million recorded a year ago. For the first six months of 2005, the Company recorded net interest income of $567.4 million, a 19% increase over the $475.0 million earned in the first six months of 2004. The increase in net interest income in the quarter was due to volume increases in interest earning assets resulting from the Company’s strong, low-cost core deposit growth.

The net interest margin for the second quarter of 2005 was 3.93%, down 11 basis points from the first quarter of 2005, and down 36 basis points from the 4.29% margin for the second quarter of 2004.

On a tax equivalent basis, the Company recorded $293.1 million in net interest income in the second quarter of 2005, an increase of $43.9 million or 18% over the second quarter of 2004. Net interest income on a tax equivalent basis of $576.1 million was earned in the first six months of 2005, an increase of $92.5 million or 19% over the first six months of 2004.

8

Net Interest Income and Rate/Volume Analysis

As shown below, the increase in net interest income on a tax equivalent basis was due to volume increases in the Company’s earning assets, which were fueled by the Company’s continued growth of low-cost core deposits. The Company’s continuing ability to grow core deposits produces net interest income growth, despite rate compression caused by the flattening yield curve.

	Net Interest Income
June 2005 vs. 2004	Volume Increase		Rate Change			Total Increase		% Increase
	(dollars in thousands)
Quarter	$	67,784		($23,902	)	$	43,882		18	%
First Six Months	$	137,965		($45,492	)	$	92,473		19	%

Non-Interest Income

Non-interest income for the second quarter of 2005 increased to $115.6 million from $92.3 million a year ago, a 25% increase. Non-interest income for the first six months of 2005 increased to $219.3 million from $178.5 million a year ago, a 23% increase. The increases in non-interest income are primarily attributable to the increases in deposit charges and service fees of 31% for both the second quarter and first six months of 2005.

The growth in non-interest income for the second quarter and the first six months is more fully depicted below:

	Three Months Ended							Six Months Ended
	6/30/05		6/30/04		% Increase			6/30/05		6/30/04		% Increase
	(dollars in thousands)
Deposit Charges & Service Fees	$	68,802	$	52,717		31	%	$	128,766	$	98,198		31	%
Other Operating Income:
Commerce Insurance		18,750		18,570		1			38,539		36,906		4
Commerce Capital Markets		7,248		6,622		9			13,687		16,349		(16	)
Loan Brokerage Fees		2,949		3,725		(21	)		5,708		6,778		(16	)
Other		13,205		10,006		32			26,835		19,217		40
Total Other Operating Income		42,152	$	38,923		8			84,769	$	79,250		7
Net Investment Securities Gains		4,689		635		638			5,797		1,059		447
Total Non-Interest Income	$	115,643	$	92,275		25	%	$	219,332	$	178,507		23	%

9

Non-Interest Expenses

Non-interest expenses for the second quarter of 2005 were $278.5 million, up 23% from $226.3 million a year ago. Non-interest expenses for the first six months of 2005 were $536.9 million, up 22% from $438.5 million a year ago. The increases in non-interest expenses for the second quarter and first six months of 2005 were widespread throughout non-interest expense categories, reflecting the Company’s store expansion program.

Lending

Net loans increased 29% to $10.5 billion from the second quarter of 2004, and the growth was widespread throughout all loan categories.

Geographically, loan growth has occurred in the following markets:

	6/30/05		6/30/04		$ Increase		% Increase			% of Total Growth
	(dollars in millions)
Metro Philadelphia	$	5,895	$	4,945	$	950		19	%		40	%
Northern New Jersey		3,125		2,481		644		26			27
New York/Long Island		1,668		904		764		85			33
Total:	$	10,688	$	8,330	$	2,358		28	%		100	%

	Loan Composition
	6/30/05			% of Total			6/30/04			% of Total			$ Increase			% Increase
	(dollars in millions)
Commercial	$	2,873			27	%	$	2,158			26	%	$	715			33	%
Owner-Occupied		2,229			21			1,805			22			424			23
Total Commercial		5,102			48	%		3,963			48	%		1,139			29	%
Consumer		3,714			35	%		2,885			34	%		829			29	%
Commercial Real Estate		1,872			17			1,482			18			390			26
Gross Loans	$	10,688			100	%	$	8,330			100	%	$	2,358
Less: Reserves		(141	)					(124	)					(17	)
Net Loans	$	10,547					$	8,206					$	2,341			29	%

10

Asset Quality

	Quarter Ended
	6/30/05		3/31/05		12/31/04		6/30/04
Non-Performing Assets/Assets	.11	%	.10	%	.11	%	.11	%
Net Loan Charge-Offs	.09	%	.11	%	.18	%	.17	%
Loan Loss Reserve/Gross Loans	1.32	%	1.40	%	1.43	%	1.50	%
Non-Performing Loan Coverage	396	%	435	%	413	%	419	%
Non-Performing Assets/Capital	2	%	2	%	2	%	2	%
and Reserves

Non-performing assets and loans past due 90 days at June 30, 2005 totaled $36.2 million or .11% of total assets, versus $30.7 million, or .11% of total assets a year ago.

Investments

At June 30, 2005, total investments increased to $19.4 billion. The available for sale and held to maturity portfolios totaled $7.7 billion and $11.7 billion, respectively.

Detailed below is information regarding the composition and characteristics of the Company’s investment portfolio, excluding trading securities, as of June 30, 2005.

Product Description		Available For Sale			Held to Maturity			Total
	(in millions)
Mortgage-backed Securities:
Federal Agencies Pass Through		$	1,379		$	2,398		$	3,777
Certificates (AAA Rated)
Collateralized Mortgage			5,725			8,294			14,019
Obligations (AAA Rated)
Obligations of State and			573			1,016			1,589
Political Subdivisions/Other
Total		$	7,677		$	11,708		$	19,385
Duration (in years)			2.30			3.22			2.86
Average Life (in years)			2.68			3.95			3.45
Quarterly Average Yield			4.94	%		4.87	%		4.91	%

At June 30, the after tax appreciation of the Company’s available for sale portfolio was $8.4 million.

11

Linked Quarter Comparison

A comparison of financial results for the quarter ended June 30, 2005 to the previous quarter ended March 31, 2005 is as follows: (dollars in thousands, except per share data)

	Three Months Ended				Linked Quarter
	6/30/05		3/31/05		$ Change		% Change
Total Assets	$	33,362,936	$	31,869,976	$	1,492,960		5	%
Total Loans (Net)		10,547,392		9,836,604		710,788		7
Core Deposits		29,624,831		28,058,156		1,566,675		6
Total Deposits		30,519,063		29,487,958		1,031,105		3
Total Revenues		404,110		382,590		21,520		6
Net Interest Income		288,467		278,901		9,566		3
Non-Interest Income		115,643		103,689		11,954		12
Non-Interest Expense		278,499		258,406		20,093		8
Net Income		79,409		77,137		2,272		3
Net Income Per Share	$	.46	$	.45	$	.01		2

Capital Resources

Stockholders’ equity at June 30, 2005 increased to $1.8 billion, a $521.4 million increase, or 39% over stockholders’ equity of $1.3 billion at June 30, 2004.

The Company may call its $200 million, 5.95% Convertible Trust Preferred Securities, provided various terms and conditions are met, primarily related to the market price of the Company’s common stock. The Company’s common stock must trade at a price of $31.65 or higher for 20 trading days in a period of 30 consecutive trading days in order for the Company to force conversion.

Each outstanding share of the Company’s $200 million, 5.95% Convertible Trust Preferred Securities is convertible into 1.8956 shares of the Company’s common stock at the option of the holder.

Return on average stockholders equity (ROE) for the second quarter and six months ending June 30, 2005 and 2004 is shown in the table below:

Return on Equity
Three Months Ended		Six Months Ended
6/30/05	6/30/04	6/30/05	6/30/04
17.68%	19.86%	17.82%	18.87%

At June 30, 2005, the Company’s book value per share was $11.48, a 30% increase over the book value per share of $8.82 at June 30, 2004.

12

The Company’s capital ratios at June 30, 2005 were as follows:

			Regulatory Guidelines
	Commerce		“Well Capitalized”
Leverage Ratio	6.20	%	5.00	%
Tier I	12.41	%	6.00	%
Total Capital	13.31	%	10.00	%

New Stores

During the second quarter of 2005, the Company opened 7 new stores, increasing the total stores opened to 326. During the last three years, the Company has opened 130 of its 326 stores.

Stores opened during the second quarter were as follows:
	Metropolitan New York
		Location	County
		Hauppauge	Suffolk (NY)
		Larchmont	Westchester (NY)
		Wayne/Valley Road	Passaic (NJ)
	Metropolitan Philadelphia
		Location	County
		Hatfield	Montgomery (PA)
		Wildwood	Cape May (NJ)
	Metropolitan Washington D.C.
		Location	County
		Connecticut Avenue	District of Columbia
		Manassas/Digges	Prince William (VA)

13

Forward-Looking Statements

The Company may from time to time make written or oral “forward-looking statements”, including statements contained in the Company’s filings with the Securities and Exchange Commission, in its reports to stockholders and in other communications by the Company, which are made in good faith by the Company pursuant to the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995.

These forward-looking statements include statements with respect to the Company’s beliefs, plans, objectives, goals, expectations, anticipations, estimates and intentions, that are subject to significant risks and uncertainties and are subject to change based on various factors (some of which are beyond the Company’s control). The words “may”, “could”, “should”, “would”, “believe”, “anticipate”, “estimate”, “expect”, “intend”, “plan”, and similar expressions are intended to identify forward-looking statements. The following factors, among others, could cause the Company’s financial performance to differ materially from that expressed in such forward-looking statements: the strength of the United States economy in general and the strength of the local economies in which the Company conducts operations; the effects of, and changes in, trade, monetary and fiscal policies, including interest rate policies of the Board of Governors of the Federal Reserve System (the “FRB”); inflation; interest rates, market and monetary fluctuations; the timely development of competitive new products and services by the Company and the acceptance of such products and services by customers; the willingness of customers to substitute competitors’ products and services for the Company’s products and services and vice versa; the impact of changes in financial services’ laws and regulations (including laws concerning taxes, banking, securities and insurance); technological changes; future acquisitions; the expense savings and revenue enhancements from acquisitions being less than expected; the growth and profitability of the Company’s non-interest or fee income being less than expected; unanticipated regulatory or judicial proceedings; changes in consumer spending and saving habits; and the success of the Company at managing the risks involved in the foregoing.

The Company cautions that the foregoing list of important factors is not exclusive. The Company does not undertake to update any forward-looking statement, whether written or oral, that may be made from time to time by or on behalf of the Company.

14