-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, Ca4o2Kh9Oc8m4RAFLVMUTRqcNl5SY+iV43InS/bTGk7Yr2SnQeE52m+jAXELVfPF L/vseheni2dfhZKPPGqItQ== 0000950159-07-000912.txt : 20070724 0000950159-07-000912.hdr.sgml : 20070724 20070724091344 ACCESSION NUMBER: 0000950159-07-000912 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 4 CONFORMED PERIOD OF REPORT: 20070724 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20070724 DATE AS OF CHANGE: 20070724 FILER: COMPANY DATA: COMPANY CONFORMED NAME: COMMERCE BANCORP INC /NJ/ CENTRAL INDEX KEY: 0000715096 STANDARD INDUSTRIAL CLASSIFICATION: NATIONAL COMMERCIAL BANKS [6021] IRS NUMBER: 222433468 STATE OF INCORPORATION: NJ FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-12069 FILM NUMBER: 07995069 BUSINESS ADDRESS: STREET 1: COMMERCE ATRIUM STREET 2: 1701 RTE 70 E CITY: CHERRY HILL STATE: NJ ZIP: 08034-5400 BUSINESS PHONE: 8567519000 MAIL ADDRESS: STREET 1: 1701 ROUTE 70 EAST CITY: CHERRY HILL STATE: NJ ZIP: 08034-5400 8-K 1 commerce8k.htm COMMERCE BANCORP 8K commerce8k.htm

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
 
FORM 8-K 
 
CURRENT REPORT
 
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 
Date of Report (Date of earliest event reported) July 24, 2007
 
Commerce Bancorp, Inc.
(Exact name of Registrant as specified in its charter)
 
New Jersey
 
1-12069
 
22-2433468
(State or other jurisdiction of incorporation or organization)
 
(Commission File Number)
 
(I.R.S. Employer Identification No.)
 
Commerce Atrium, 1701 Route 70 East, Cherry Hill, NJ 08034-5400
(Address of principal executive offices) (Zip Code)
 
Registrant’s telephone number, including area code:
 
(856) 751-9000
 
N/A
(Former name or former address, if changed since last report.)



Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant
under any of the following provisions (see General Instruction A.2. below):
o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))




Item 2.02 RESULTS OF OPERATIONS AND FINANCIAL CONDITION

On July 24, 2007 the Registrant issued a press release reporting its results for the second quarter of 2007. A copy of the press release is attached as Exhibit 99.1 to this report.

On July 24, 2007 the Registrant also made certain supplemental information available. A copy of the supplemental information is attached as Exhibit 99.2 to this report.
 
Item 9.01. FINANCIAL STATEMENTS AND EXHIBITS

(c)  Exhibits






SIGNATURES
 
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
 
 
 
 
 
Commerce Bancorp, Inc.
       
July 24, 2007
 
 
 
By:
 
/s/ Douglas J. Pauls
 
 
 
 
 
 
Name:
 
Douglas J. Pauls
 
 
 
 
 
 
Title:
 
Executive Vice President and Chief Financial Officer
                 



Exhibit Index
 
Number
Description
   
99.1
99.2

EX-99.1 2 ex99-1.htm EXHIBIT 99.1 ex99-1.htm

Commerce Bancorp
 

CONTACTS


Douglas J. Pauls
C. Edward Jordan, Jr.
Chief Financial Officer
Executive Vice President

(856) 751-9000

COMMERCE BANCORP CORE DEPOSITS UP 17%,
RECEIVES BRANCH APPROVAL FROM OCC

July 24, 2007 – Cherry Hill, New Jersey – Commerce Bancorp, Inc. (NYSE Symbol: CBH) reported increased assets, deposits and loans for the second quarter of 2007.
 
SECOND QUARTER FINANCIAL HIGHLIGHTS
June 30, 2007

     
%
Change
       
Total Assets:
$48.2
Billion
11%
Core Deposits:
$43.0
Billion
17%
Total (Net) Loans:
$16.2
Billion
15%
Total Revenues:
$519.4
Million
12%
Net Income:
$76.9
Million
(3)%
Net Income Per Share:
$.39
  
(5)%



Company Statement

Financial highlights for the second quarter were:

·  
Deposit growth continues to drive the Company’s overall growth.

·  
Core deposits increased $6.2 billion, up 17%, for the prior 12 months, while total deposits increased  $6.3 billion, or 17%, for the prior 12 months.

·  
Annualized core deposit growth per store was $15 million.

·  
Comparable store core deposit growth was 15%

·  
Commercial core deposits grew 18% to $17.3 billion.

·  
New York City core deposits increased to $7.2 billion, up 29%.

·  
Net loans grew $2.1 billion, or 15%, to $16.2 billion.

·  
Revenue grew 12% despite the continuing difficult interest rate environment.

·  
Net income was $76.9 million and net income per share was $.39 for the second quarter of 2007.

·  
During the second quarter of 2007, the Company recorded non-recurring, pre-tax charges of approximately $5.1 million (approximately $.02 per share, after tax), primarily related to legal costs associated with the investigation being conducted by the Office of the Comptroller of the Currency (OCC) and net losses related to the Company’s equity method investments.

·  
Shareholder equity increased $366.4 million, or 15%, to $2.9 billion.

·  
Book value per share grew 12% to $14.55.

Expansion Plans

The Commerce growth model includes the opening of new stores in both existing and new markets, with a goal of increasing the store base by approximately 15% a year.  During the first six months of 2007, the Company opened 14 new stores, including its first in Miami-Dade County, Florida.

·  
In 2007, the Company expects to open a total of +/- 50 stores, which will increase total stores to approximately 480.  Openings are planned in the following markets:

Metro New York 25 +/-
Metro Philadelphia10 +/-
Metro Washington5 +/-
Southeast Florida10 +/-

·  
The Company has finalized its revised branch application process with the OCC and has received approval for one branch under the revised process.  Accordingly, the Company will submit additional branch applications.

2

The Commercial Bank
 
                         
   
6/30/07
    
6/30/06
    
$ Increase
    
% Increase
  
   
(dollars in millions)
Commercial Core Deposits:
   $
17,319
     $
14,637
     $
2,682
       18 %
Commercial Loans:
    
10,332
      
8,995
      
1,337
      
15
  

Lending

Loans increased 15% to $16.4 billion from the second quarter of 2006, and the growth was widespread throughout all loan categories.  

Regional Loan Growth:
 
   
6/30/07
    
6/30/06
    
$ Increase
    
% Increase
    
% of Total Growth
  
   
(dollars in millions)
  
Metro New York
   $
8,413
     $
7,104
     $
1,309
       18 %     63 %
Metro Philadelphia
    
7,164
      
6,693
      
471
      
7
      
22
  
Metro Washington
    
286
      
119
      
167
      
140
      
8
  
Southeast Florida
    
505
      
358
      
147
      
41
      
7
  
                                         
Total:
   $
16,368
     $
14,274
     $
2,094
       15 %     100 %


Loan Composition:
 
   
6/30/07
 
  
% of Total
    
6/30/06
    
% of Total
    
$ Increase
    
% Increase
  
   
(dollars in millions)
  
Commercial
   $
4,458
       27 %   $
3,731
       26 %   $
727
       19 %
Owner-Occupied RE
    
3,000
      
18
      
2,614
      
18
      
386
      
15
  
Total Commercial
    
7,458
      
45
      
6,345
      
44
      
1,113
      
18
  
Consumer
    
6,036
      
37
      
5,279
      
37
      
757
      
14
  
Commercial Real Estate
    
2,874
      
18
      
2,650
      
19
      
224
      
8
  
Total Loans
   $
16,368
       100 %   $
14,274
       100 %   $
2,094
       15 %

The loan-to-deposit ratio was 37% at June 30, 2007.
3
 
Asset Quality
 
   
Quarter Ended
  
   
6/30/07
    
3/31/07
    
6/30/06
  
                   
Non-Performing Assets/Assets
     .12 %     .11 %     .12 %
Net Loan Charge-Offs
     .18 %     .16 %     .06 %
Reserve for Credit Losses/Gross Loans
     1.04 %     1.03 %     1.04 %
Non-Performing Loan Coverage
     334 %     351 %     291 %
Non-Performing Assets/Capital
     2 %     2 %     2 %
and Reserves
                        

Non-performing assets and loans past due 90 days at June 30, 2007 totaled $56.9 million or .12% of total assets, versus $52.4 million, or .11% of total assets, at March 31, 2007 and $53.0 million, or .12% of total assets, at June 30, 2006.

Income Statement
 
   
Three Months Ended      
    
Six Months Ended      
  
   
6/30/07
    
6/30/06
    
% Change
    
6/30/07
    
6/30/06
    
% Change
  
   
(dollars in thousands, except per share data)
  
Total Revenues:
   $
519,397
     $
461,893
       12 %   $
1,011,804
     $
900,825
       12 %
Total Expenses:
    
387,895
      
333,784
      
16
      
750,680
      
649,118
      
16
  
Net Income:
    
76,903
      
79,520
       (3 )    
154,839
      
156,817
       (1 )
Net Income Per Share:
   $
.39
     $
.41
       (5 )   $
.79
     $
.82
       (4 )


Balance Sheet
 
                         
   
6/30/07
    
6/30/06
    
$ Increase
    
% Increase
  
   
(dollars in millions)
  
Total Assets:
   $
48,176
     $
43,436
     $
4,740
       11 %
Total Loans (Net):
    
16,207
      
14,133
      
2,074
      
15
  
Core Deposits:
    
43,014
      
36,784
      
6,230
      
17
  
Total Deposits:
    
44,388
      
38,050
      
6,338
      
17
  


4

Deposit Growth

   
6/30/07
    
6/30/06
    
$ Increase
    
% Increase
  
   
(dollars in millions)
  
Core Deposits
   $
43,014
     $
36,784
     $
6,230
       17 %
                                 
Total Deposits
   $
44,388
     $
38,050
     $
6,338
       17 %
                                 


Regional Deposit Growth
 
 Core deposit growth by region is as follows:
 
   
# of
Stores
    
6/30/07
    
6/30/06
    
$
Increase
    
%
Increase
    
Average
Store
Size
    
Annualized Growth/
Store
  
   
(dollars in millions)
  
Northern New Jersey
    
144
     $
13,030
     $
11,388
     $
1,642
       14 %   $
90
     $
12
  
New York City
    
59
      
7,217
      
5,596
      
1,621
      
29
      
122
      
30
  
Long Island/Westchester/CT  
52
      
4,391
      
3,498
      
893
      
26
      
84
      
19
  
Metro New York
    
255
     $
24,638
     $
20,482
     $
4,156
       20 %   $
97
     $
17
  
Metro Philadelphia
    
156
      
17,445
      
15,763
      
1,682
      
11
      
112
      
11
  
Metro Washington
    
19
      
542
      
280
      
262
      
94
      
29
      
19
  
Southeast Florida
    
12
      
389
      
259
      
130
      
50
      
32
      
14
  
Total Core Deposits
    
442
     $
43,014
     $
36,784
     $
6,230
       17 %   $
97
     $
15
  
Total Deposits
           $
44,388
     $
38,050
     $
6,338
       17 %   $
100
     $
15
  


Metro New York remains the Company’s largest and fastest growing market with core deposits of $24.6 billion, an increase of 20% over the second quarter of 2006, and an annualized core deposit growth per store of $17 million.  This market is expected to continue to lead the deposit growth of the Company.


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 one year or more at the balance sheet date.

 
   
Core Deposit Growth   
  
             
   
Stores Open 1   
  
   
Year or More   
  
             
   
# of
Stores
    
Comp Store
Increase
  
Metro Philadelphia
    
149
       11 %
Northern New Jersey
    
132
      
13
  
New York City
    
48
      
29
  
Long Island/Westchester/CT
    
44
      
21
  
Metro Washington
    
8
      
66
  
Southeast Florida
    
8
      
29
  
Total
    
389
       15 %
                 

Core Deposits

Core deposit growth by type of account is as follows:

   
6/30/07
    
6/30/06
    
$ Change
    
% Change
    
2nd Quarter
Cost of
Funds
  
   
(dollars in millions)
  
Demand
   $
9,377
     $
8,654
     $
723
       8 %     0.00 %
Interest Bearing Demand
    
18,860
      
14,269
      
4,591
      
32
      
3.71
  
Savings
    
10,524
      
10,729
       (205 )     (2 )    
2.80
  
Subtotal
    
38,761
      
33,652
      
5,109
       15 %     2.60 %
                                         
Time
    
4,253
      
3,132
      
1,121
      
36
      
4.49
  
Total Core Deposits:
   $
43,014
     $
36,784
     $
6,230
       17 %     2.78 %
                                         


6

Core deposit growth by type of customer is as follows:

   
6/30/07
    
% Total
    
6/30/06
    
% Total
    
$ Increase
    
% Increase   
  
   
(dollars in millions)
         
Consumer
   $
18,156
       42 %   $
15,766
       43 %   $
2,390
       15 %
Commercial
    
17,319
      
40
      
14,637
      
40
      
2,682
      
18  
  
Government
    
7,539
      
18
      
6,381
      
17
      
1,158
      
18  
  
                                                 
Total
   $
43,014
       100 %   $
36,784
       100 %   $
6,230
       17 %


Net Income and Net Income Per Share

Net income totaled $76.9 million for the second quarter of 2007, compared to net income of $79.5 million for the second quarter of 2006.  On a diluted per share basis, net income for the second quarter of 2007 was $.39 compared to $.41 for the second quarter of 2006.

   
Three Months Ended      
    
Six Months Ended      
  
   
6/30/07
    
6/30/06
    
% Change
    
6/30/07
    
6/30/06
    
% Change
  
   
(dollars in thousands, except per share data)
  
Net Income:
   $
76,903
     $
79,520
       (3 )%   $
154,839
     $
156,817
       (1 )%
Net Income Per Share:
   $
.39
     $
.41
       (5 )   $
.79
     $
.82
       (4 )

For the first six months of 2007, net income totaled $154.8 million, compared to $156.8 million for the first six months of 2006.

On a diluted per share basis, net income for the first six months of 2007 was $ .79 compared to $.82 for the first six months of 2006.

Net income and net income per share for the second quarter and first six months of 2007 were reflective of the continuing difficult interest rate environment and its impact on the Company’s net interest income, as well as increased FDIC assessments and certain non-recurring items.


7

Net Interest Income and Net Interest Margin

Net interest income for the second quarter totaled $342.8 million, a 7% increase over the $318.9 million recorded a year ago, despite the continuing difficult interest rate environment.  For the first six months of 2007, the Company recorded net interest income of $675.8 million, an 8% increase over the $626.9 million earned in the first six months of 2006.  The increase in net interest income during the quarter and first six months was due to volume increases in interest earning assets resulting from the Company’s continued deposit growth.

The net interest margin for the second quarter of 2007 decreased slightly to 3.22%, compared to 3.27% for the first quarter of 2007, and was down 17 basis points from the 3.39% margin for the second quarter of 2006.  The year over year compression in net interest margin was primarily caused by the continuing difficult interest rate environment.

On a tax equivalent basis, the Company recorded $350.1 million in net interest income in the second quarter of 2007, an increase of $25.1 million or 8% over the second quarter of 2006.  Net interest income on a tax equivalent basis of $690.6 million was earned in the first six months of 2007, an increase of $51.8 million or 8% over the first six months of 2006.

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 deposit growth.  The Company’s continuing ability to grow deposits produces net interest income growth, despite rate compression primarily caused by the continuing difficult interest rate environment.


   
Net Interest Income
  
June
2007 vs. 2006
  
Volume
Increase
    
Rate
Change
    
Total
Increase
    
%
Increase
  
   
(dollars in thousands)
  
                         
Quarter
   $
44,950
     $ (19,826 )   $
25,124
       8 %
First Six Months
   $
95,718
     $ (43,897 )   $
51,821
       8 %
                                 


8

Non-Interest Income

Non-interest income for the second quarter of 2007 increased to $176.6 million from $143.0 million a year ago, a 24% increase.  Excluding net investment securities gains, non-interest income for the first six months of 2007 increased to $333.1 million from $274.0 million a year ago, a 22% increase.  The increases in non-interest income are primarily attributable to the increase in deposit charges and service fees of 28% for both the second quarter and first six months of 2007.

The growth in non-interest income for the second quarter and the first six months of 2007 is more fully depicted below:
   
Three Months Ended
    
Six Months Ended
  
   
6/30/07
    
6/30/06
    
% Change
    
6/30/07
    
6/30/06
    
% Change
  
   
(dollars in thousands)
  
                                     
Deposit Charges & Service Fees
   $
116,913
     $
91,653
       28 %   $
222,119
     $
173,934
       28 %
Other Operating Income:
                                                
    Commerce Banc Insurance
    
23,084
      
20,573
      
12
      
45,734
      
42,517
      
8
  
    Commerce Capital Markets
    
8,037
      
7,263
      
11
      
15,305
      
13,498
      
13
  
    Operating Lease Revenue
    
4,797
      
3,475
      
38
      
10,051
      
6,977
      
44
  
    Loan Brokerage Fees
    
2,641
      
2,183
      
21
      
5,603
      
4,119
      
36
  
    Other
    
21,100
      
17,809
      
18
      
34,332
      
32,913
      
4
  
       Total Other Operating Income
    
59,659
      
51,303
      
16
      
111,025
      
100,024
      
11
  
    Subtotal
    
176,572
      
142,956
      
24
      
333,144
      
273,958
      
22
  
Net Investment Securities Gains
    
-
      
-
      
-
      
2,879
      
-
      
100
  
Total Non-Interest Income
   $
176,572
     $
142,956
       24 %   $
336,023
     $
273,958
       23 %

Included in other operating income for the second quarter and first six months of 2007 are $2.5 million and $7.5 million, respectively, of net losses related to the Company’s equity method investments.

Non-Interest Expenses

Non-interest expenses for the second quarter of 2007 were $387.9 million, up 16% from $333.8 million a year ago.  Non-interest expenses for the first six months of 2007 were $750.7 million, up 16% from $649.1 million a year ago.  The increases in non-interest expenses for the second quarter and six months ended June 30, 2007 were widespread throughout non-interest expense categories, reflecting the Company’s store expansion program. The Company remains focused on controlling costs while continuing to execute its growth model.

Included in non-interest expenses are increased FDIC assessments of $6.5 million and $8.4 million for the second quarter and first six months of 2007, respectively, compared to the same periods a year ago.  Excluding these amounts, the Company’s non-interest expenses would have increased by 14% for both the second quarter and first six months from the prior year.

9


Non-interest expenses were also impacted by non-recurring charges of approximately $2.6 million and $3.8 million during the second quarter and first six months of 2007, respectively.  These non-recurring expenses were primarily legal costs incurred by the Company associated with the ongoing investigation being conducted by the OCC.

Investments

At June 30, 2007, total investments increased to $27.8 billion.  The available for sale and held to maturity portfolios totaled $13.2 billion and $14.6 billion, respectively.

None of the securities in the Company’s investment portfolio are backed by subprime mortgages.

Detailed below is information regarding the composition and characteristics of the Company’s investment portfolio, excluding trading securities, at June 30, 2007.


Product Description
  
Available
For Sale
    
Held to
Maturity
    
Total
  
   
(in millions)
  
Mortgage-backed Securities:
                  
Federal Agencies Pass Through
   $
1,545
     $
1,950
     $
3,495
  
Certificates (AAA Rated)
                        
Collateralized Mortgage
    
10,519
      
10,514
      
21,033
  
Obligations (AAA Rated)
                        
Obligations of State and
    
1,157
      
2,122
      
3,279
  
Political Subdivisions/Other
                        
Total
   $
13,221
     $
14,586
     $
27,807
  
                         
Duration (in years)
    
3.73
      
4.36
      
4.06
  
Average Life (in years)
    
6.42
      
6.44
      
6.43
  
Quarterly Average Yield
     5.74 %     5.42 %     5.57 %

At June 30, 2007, the after tax depreciation of the Company’s available for sale portfolio was $123.8 million.


10


Capital Resources

Stockholders’ equity at June 30, 2007 increased to $2.9 billion, a $366.4 million increase, or 15% over stockholders’ equity of $2.5 billion at June 30, 2006.

Return on average stockholders equity (ROE) for the second quarter and six months ending June 30, 2007 and 2006 is shown in the table below:
 

 
Three Months Ended                                       Six Months Ended
6/30/07                         6/30/06                      6/30/07                      6/30/06
10.57%                         12.83%                      10.72%                      12.92%

At June 30, 2007, the Company’s book value per share was $14.55, a 12% increase over the book value per share of $12.96 at June 30, 2006.

The Company’s capital ratios at June 30, 2007 were as follows:
 
         
Regulatory Guidelines
  
   
Commerce
    
“Well Capitalized”
  
             
Leverage Ratio
     6.06 %     5.00 %
Tier I
     11.72 %     6.00 %
Total Capital
     12.43 %     10.00 %


Shareholder Returns

 
       
June 30, 2007   
  
       
Commerce
    
S & P Index
  
                 
 
1
  
Year
     5 %     21 %
 
5
  
Years
     12 %     11 %
 
10
  
Years
     21 %     7 %
 
11

New Stores

During the second quarter of 2007, the Company added 5 new stores, increasing the total stores to 442.  During the last three years, the Company has added 153 of its 442 stores.  At June 30, 2007 deposits for the Company’s 153 stores opened during the last three years totaled $6.6 billion.

 
Stores opened during the second quarter were as follows:

Metropolitan New York
     
 
Location
County
     
 
Franklin Square
Nassau (NY)
 
Garnerville
Rockland (NY)
 
Lakewood
Ocean (NJ)

Metropolitan Washington, D.C.
     
 
Location
County
     
 
Silver Spring
Montgomery (MD)
     

Southeastern Florida
     
 
Location
County
     
 
Palm Beach/South County
Palm Beach (FL)


12

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 shareholders 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 or other forward looking statements 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; 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; the ability to maintain the growth and further development of the Company’s community-based retail branching network; unanticipated regulatory or judicial proceedings (including those regulatory and other approvals necessary to open new stores); 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.

The Company cautions that any such forward-looking statements are not guarantees of future performance and involve known and unknown risks, uncertainties and other factors which may cause the Company’s actual results, performance or achievements to differ materially from the future results, performance or achievements the Company has anticipated in such forward-looking statements.  You should note that many factors could affect the Company’s future financial results and could cause those results to differ materially from those expressed or implied in the Company’s forward-looking statements contained in this document.
 
 
13
 EX-99.2 3 ex99-2.htm EXHIBIT 99.2 ex99-2.htm
Exhibit 99.2
 
Commerce Bancorp, Inc. and Subsidiaries
Consolidated Balance Sheets
(unaudited) 
 
 
          
June 30,
    
March 31,
    
Linked Quarter
    
June 30,
        
 
(dollars in thousands)   
  
2007
    
2007
    
% Change
    
2006
    
% Change
  
                                 
Assets
Cash and due from banks   
   $
1,405,696
     $
1,237,008
       14 %   $
1,409,537
       (0 )%
 
Federal funds sold    
    
9,700
      
506,400
       (98 )    
56,600
       (83 )
 
   Cash and cash equivalents  
    
1,415,396
      
1,743,408
       (19 )    
1,466,137
       (3 )
 
Loans held for sale    
    
31,618
      
48,447
       (35 )    
43,825
       (28 )
 
Trading securities    
    
77,472
      
156,241
       (50 )    
91,148
       (15 )
 
Securities available for sale   
    
13,221,171
      
12,333,705
      
7
      
11,074,128
      
19
  
 
Securities held to maturity  
    
14,585,714
      
14,811,708
       (2 )    
14,415,921
      
1
  
 
Loans:     
                                        
 
 Commercial real estate: 
                                        
 
    Investor developer 
    
2,376,510
      
2,562,842
       (7 )    
2,329,475
      
2
  
 
    Residential construction 
    
497,202
      
344,144
      
44
      
320,749
      
55
  
            
2,873,712
      
2,906,986
       (1 )    
2,650,224
      
8
  
 
 Commercial loans:  
                                        
 
    Term   
    
2,627,535
      
2,432,065
      
8
      
2,028,761
      
30
  
 
    Line of credit  
    
1,830,054
      
1,790,734
      
2
      
1,702,539
      
7
  
            
4,457,589
      
4,222,799
      
6
      
3,731,300
      
19
  
 
 Owner-occupied  
    
3,000,421
      
3,007,211
       (0 )    
2,613,555
      
15
  
            
7,458,010
      
7,230,010
      
3
      
6,344,855
      
18
  
 
 Consumer:   
                                        
 
    Mortgages (1-4 family residential)
    
2,299,516
      
2,256,222
      
2
      
2,198,114
      
5
  
 
    Installment  
    
283,717
      
282,667
      
0
      
265,639
      
7
  
 
    Home equity  
    
3,299,510
      
3,119,327
      
6
      
2,714,150
      
22
  
 
    Credit lines  
    
153,114
      
138,794
      
10
      
100,544
      
52
  
            
6,035,857
      
5,797,010
      
4
      
5,278,447
      
14
  
 
       Total loans  
    
16,367,579
      
15,934,006
      
3
      
14,273,526
      
15
  
 
 Less allowance for loan losses
    
160,694
      
155,912
      
3
      
140,746
      
14
  
            
16,206,885
      
15,778,094
      
3
      
14,132,780
      
15
  
 
Bank premises and equipment, net 
    
1,882,287
      
1,801,998
      
4
      
1,494,333
      
26
  
 
Goodwill and other intangible assets 
    
145,335
      
145,923
       (0 )    
148,846
       (2 )
 
Other assets   
    
609,647
      
552,108
      
10
      
569,181
      
7
  
 
Total assets   
   $
48,175,525
     $
47,371,632
       2 %   $
43,436,299
       11 %
                                              
Liabilities
Deposits:    
                                        
 
 Demand:   
                                        
 
   Noninterest-bearing 
   $
9,376,914
     $
9,321,584
       1 %   $
8,653,739
       8 %
 
   Interest-bearing   
    
18,859,695
      
18,682,011
      
1
      
14,269,002
      
32
  
 
 Savings   
    
10,524,414
      
10,580,371
       (1 )    
10,765,985
       (2 )
 
 Time   
    
5,627,242
      
5,391,900
      
4
      
4,361,036
      
29
  
 
   Total deposits  
    
44,388,265
      
43,975,866
      
1
      
38,049,762
      
17
  
                                                
 
Other borrowed money   
    
545,310
      
122,725
      
344
      
2,568,445
       (79 )
 
Other liabilities   
    
349,226
      
391,848
       (11 )    
291,732
      
20
  
            
45,282,801
      
44,490,439
      
2
      
40,909,939
      
11
  
                                            
Stockholders'
Common stock   
    
194,119
      
192,751
      
1
      
186,662
      
4
  
Equity
Capital in excess of par value 
    
1,812,341
      
1,779,523
      
2
      
1,646,984
      
10
  
 
Retained earnings   
    
1,059,127
      
1,007,299
      
5
      
863,229
      
23
  
 
Accumulated other comprehensive (loss) income
     (123,847 )     (49,364 )    
151
       (154,043 )     (20 )
            
2,941,740
      
2,930,209
      
0
      
2,542,832
      
16
  
                                                
 
Less treasury stock, at cost  
    
49,016
      
49,016
      
0
      
16,472
      
198
  
 
   Total stockholders' equity 
    
2,892,724
      
2,881,193
      
0
      
2,526,360
      
15
  
 
Total liabilities and stockholders' equity
   $
48,175,525
     $
47,371,632
       2 %   $
43,436,299
       11 %
 
 
Commerce Bancorp, Inc. and Subsidiaries
Consolidated Balance Sheets
(unaudited) 
 
                                             
(dollars in thousands)  
  
June 30,
    
March 31, 2007      
    
June 30, 2006      
  
      
2007
    
Actual
    
$ Change
    
% Change
    
Actual
    
$ Change
    
% Change
  
    
Assets
                                          
Cash and due from banks 
   $
1,405,696
     $
1,237,008
     $
168,688
       14 %   $
1,409,537
     $ (3,841 )     (0 )%
Federal funds sold  
    
9,700
      
506,400
       (496,700 )     (98 )    
56,600
       (46,900 )     (83 )
   Cash and cash equivalents
    
1,415,396
      
1,743,408
       (328,012 )     (19 )    
1,466,137
       (50,741 )     (3 )
Loans held for sale  
    
31,618
      
48,447
       (16,829 )     (35 )    
43,825
       (12,207 )     (28 )
Trading securities  
    
77,472
      
156,241
       (78,769 )     (50 )    
91,148
       (13,676 )     (15 )
Securities available for sale 
    
13,221,171
      
12,333,705
      
887,466
      
7
      
11,074,128
      
2,147,043
      
19
  
Securities held to maturity 
    
14,585,714
      
14,811,708
       (225,994 )     (2 )    
14,415,921
      
169,793
      
1
  
                                                            
Loans   
    
16,367,579
      
15,934,006
      
433,573
      
3
      
14,273,526
      
2,094,053
      
15
  
 Less allowance for loan losses
    
160,694
      
155,912
      
4,782
      
3
      
140,746
      
19,948
      
14
  
        
16,206,885
      
15,778,094
      
428,791
      
3
      
14,132,780
      
2,074,105
      
15
  
 Reserve % 
     1.04 %     1.03 %                     1.04 %                
Bank premises and equipment, net 
    
1,882,287
      
1,801,998
      
80,289
      
4
      
1,494,333
      
387,954
      
26
  
Other assets   
    
754,982
      
698,031
      
56,951
      
8
      
718,027
      
36,955
      
5
  
Total assets   
   $
48,175,525
     $
47,371,632
     $
803,893
       2 %   $
43,436,299
     $
4,739,226
       11 %
Liabilities
                                                        
Deposits:   
                                                        
 Demand: 
                                                        
   Noninterest-bearing
   $
9,376,914
     $
9,321,584
     $
55,330
       1 %   $
8,653,739
     $
723,175
       8 %
   Interest-bearing 
    
18,859,695
      
18,682,011
      
177,684
      
1
      
14,269,002
      
4,590,693
      
32
  
 Savings 
    
10,524,414
      
10,580,371
       (55,957 )     (1 )    
10,765,985
       (241,571 )     (2 )
 Time 
    
5,627,242
      
5,391,900
      
235,342
      
4
      
4,361,036
      
1,266,206
      
29
  
   Total deposits 
    
44,388,265
      
43,975,866
      
412,399
      
1
      
38,049,762
      
6,338,503
      
17
  
                                                            
 Core deposits 
    
43,013,805
      
42,698,696
      
315,109
      
1
      
36,783,874
      
6,229,931
      
17
  
                                                            
Total other liabilities 
    
894,536
      
514,573
      
379,963
      
74
      
2,860,177
       (1,965,641 )     (69 )
        
45,282,801
      
44,490,439
      
792,362
      
2
      
40,909,939
      
4,372,862
      
11
  
                                                            
Stockholders' Equity
    
2,892,724
      
2,881,193
      
11,531
      
0
      
2,526,360
      
366,364
      
15
  
Total liabilities and stockholders' equity
   $
48,175,525
     $
47,371,632
     $
803,893
       2 %   $
43,436,299
     $
4,739,226
       11 %
 
 
Commerce Bancorp, Inc. and Subsidiaries
Consolidated Balance Sheets
(unaudited) 

 
       
June 30,
    
December 31,
  
 
(dollars in thousands)
  
2007
    
2006
  
                 
Assets
Cash and due from banks
   $
1,405,696
     $
1,207,390
  
 
Federal funds sold
    
9,700
      
9,300
  
 
   Cash and cash equivalents
    
1,415,396
      
1,216,690
  
 
Loans held for sale
    
31,618
      
52,741
  
 
Trading securities
    
77,472
      
106,007
  
 
Securities available for sale
    
13,221,171
      
11,098,113
  
 
Securities held to maturity
    
14,585,714
      
14,884,982
  
 
    (market value 06/07-$14,171,224; 2006-$14,617,764)
                
 
Loans
      
16,367,579
      
15,607,049
  
 
 Less allowance for loan losses
    
160,694
      
152,053
  
         
16,206,885
      
15,454,996
  
 
Bank premises and equipment, net
    
1,882,287
      
1,753,670
  
 
Goodwill and other intangible assets
    
145,335
      
141,631
  
 
Other assets
      
609,647
      
562,986
  
 
Total assets
     $
48,175,525
     $
45,271,816
  
                     
Liabilities
Deposits:
                  
 
 Demand:
                
 
   Noninterest-bearing
   $
9,376,914
     $
8,936,824
  
 
   Interest-bearing
    
18,859,695
      
16,853,457
  
 
 Savings
    
10,524,414
      
10,459,306
  
 
 Time
    
5,627,242
      
5,038,624
  
 
   Total deposits
    
44,388,265
      
41,288,211
  
                     
 
Other borrowed money
    
545,310
      
777,404
  
 
Other liabilities
      
349,226
      
405,103
  
         
45,282,801
      
42,470,718
  
                     
Stockholders'
Common stock, 194,119,379 shares issued (189,738,423 shares in 2006)
    
194,119
      
189,738
  
Equity
Capital in excess of par value
    
1,812,341
      
1,744,691
  
 
Retained earnings
    
1,059,127
      
958,770
  
 
Accumulated other comprehensive (loss) income
     (123,847 )     (65,240 )
         
2,941,740
      
2,827,959
  
                     
 
Less treasury stock, at cost, 1,874,923 shares (1,231,081 shares in 2006)
    
49,016
      
26,861
  
     Total stockholders' equity    
2,892,724
      
2,801,098
  
 
Total liabilities and stockholders' equity
   $
48,175,525
     $
45,271,816
  
 
 
 
Commerce Bancorp, Inc. and Subsidiaries
Consolidated Statements of Income
(unaudited) 
 
               
     
Three Months Ended
    
Six Months Ended
  
     
June 30,
    
June 30,
  
 
(dollars in thousands, except per share amounts)
  
2007
    
2006
    
% Change
    
2007
    
2006
    
% Change
  
                                       
Interest
Interest and fees on loans
   $
278,863
     $
236,890
       18 %   $
549,633
     $
451,864
       22 %
income
Interest on investments
    
376,245
      
325,022
      
16
      
731,553
      
620,098
      
18
  
 
Other interest
    
2,000
      
250
      
700
      
7,733
      
663
      
1,066
  
 
     Total interest income
    
657,108
      
562,162
      
17
      
1,288,919
      
1,072,625
      
20
  
                                                   
Interest
Interest on deposits:
                                                
expense
   Demand
    
177,289
      
118,085
      
50
      
341,031
      
216,025
      
58
  
 
   Savings
    
72,954
      
64,157
      
14
      
145,072
      
118,161
      
23
  
 
   Time
    
60,521
      
41,174
      
47
      
119,384
      
77,435
      
54
  
 
     Total interest on deposits
    
310,764
      
223,416
      
39
      
605,487
      
411,621
      
47
  
 
Interest on other borrowed money
    
3,519
      
19,809
       (82 )    
7,651
      
34,137
       (78 )
 
     Total interest expense
    
314,283
      
243,225
      
29
      
613,138
      
445,758
      
38
  
                                                   
 
Net interest income
    
342,825
      
318,937
      
7
      
675,781
      
626,867
      
8
  
 
Provision for credit losses
    
12,550
      
7,500
      
67
      
22,550
      
14,001
      
61
  
 
Net interest income after provision for credit losses
    
330,275
      
311,437
      
6
      
653,231
      
612,866
      
7
  
                                                   
Noninterest
Deposit charges and service fees
    
116,913
      
91,653
      
28
      
222,119
      
173,934
      
28
  
income
Other operating income
    
59,659
      
51,303
      
16
      
111,025
      
100,024
      
11
  
 
Net investment securities (losses) gains
    
0
      
0
      
0
      
2,879
      
0
      
0
  
 
     Total noninterest income
    
176,572
      
142,956
      
24
      
336,023
      
273,958
      
23
  
                                                   
 
     Total Revenues
    
519,397
      
461,893
      
12
      
1,011,804
      
900,825
      
12
  
                                                   
Noninterest
Salaries and benefits
    
171,494
      
150,630
      
14
      
339,253
      
295,455
      
15
  
expense
Occupancy
    
58,626
      
45,487
      
29
      
116,698
      
91,727
      
27
  
 
Furniture and equipment
    
45,271
      
39,656
      
14
      
88,123
      
75,616
      
17
  
 
Office
    
16,808
      
14,398
      
17
      
33,111
      
29,871
      
11
  
 
Marketing
    
10,694
      
11,699
       (9 )    
21,127
      
19,510
      
8
  
 
Other
    
85,002
      
71,914
      
18
      
152,368
      
136,939
      
11
  
 
     Total noninterest expenses
    
387,895
      
333,784
      
16
      
750,680
      
649,118
      
16
  
                                                   
 
Income before income taxes
    
118,952
      
120,609
       (1 )    
238,574
      
237,706
      
0
  
 
Provision for federal and state income taxes
    
42,049
      
41,089
      
2
      
83,735
      
80,889
      
4
  
 
Net income
   $
76,903
     $
79,520
       (3 )%   $
154,839
     $
156,817
       (1 )%
                                                   
 
Net income per common and common equivalent share:
                                                
 
   Basic
   $
0.40
     $
0.43
       (7 )%   $
0.81
     $
0.86
       (6 )%
 
   Diluted
   $
0.39
     $
0.41
       (5 )   $
0.79
     $
0.82
       (4 )
 
Average common and common equivalent shares outstanding:
                                          
 
   Basic
    
191,552
      
184,437
      
4
      
190,421
      
182,686
      
4
  
 
   Diluted
    
197,462
      
193,842
      
2
      
196,987
      
191,914
      
3
  
 
Cash dividends, common stock
   $
0.13
     $
0.12
       8 %   $
0.26
     $
0.24
       8 %
 
 
Commerce Bancorp, Inc. and Subsidiaries
Consolidated Statements of Income
(unaudited) 
 
                                 
     
Three Months Ended
  
     
June 30,
    
March 31,
          
June 30,
        
 
(dollars in thousands, except per share amounts)
  
2007
    
2007
    
% Change
    
2006
    
% Change
  
                                 
Interest
Interest and fees on loans
   $
278,863
     $
270,770
       3 %   $
236,890
       18 %
income
Interest on investments
    
376,245
      
355,308
      
6
      
325,022
      
16
  
 
Other interest
    
2,000
      
5,733
       (65 )    
250
      
700
  
 
     Total interest income
    
657,108
      
631,811
      
4
      
562,162
      
17
  
                                           
Interest
Interest on deposits:
                                        
expense
   Demand
    
177,289
      
163,742
      
8
      
118,085
      
50
  
 
   Savings
    
72,954
      
72,118
      
1
      
64,157
      
14
  
 
   Time
    
60,521
      
58,863
      
3
      
41,174
      
47
  
 
     Total interest on deposits
    
310,764
      
294,723
      
5
      
223,416
      
39
  
 
Interest on other borrowed money
    
3,519
      
4,132
       (15 )    
19,809
       (82 )
 
     Total interest expense
    
314,283
      
298,855
      
5
      
243,225
      
29
  
                                           
 
Net interest income
    
342,825
      
332,956
      
3
      
318,937
      
7
  
 
Provision for credit losses
    
12,550
      
10,000
      
26
      
7,500
      
67
  
 
Net interest income after provision for credit losses
    
330,275
      
322,956
      
2
      
311,437
      
6
  
                                           
Noninterest
Deposit charges and service fees
    
116,913
      
105,206
      
11
      
91,653
      
28
  
income
Other operating income
    
59,659
      
51,366
      
16
      
51,303
      
16
  
 
Net investment securities (losses) gains
    
0
      
2,879
       (100 )    
0
      
0
  
 
     Total noninterest income
    
176,572
      
159,451
      
11
      
142,956
      
24
  
                                           
 
     Total Revenues
    
519,397
      
492,407
      
5
      
461,893
      
12
  
                                           
Noninterest
Salaries and benefits
    
171,494
      
167,759
      
2
      
150,630
      
14
  
expense
Occupancy
    
58,626
      
58,072
      
1
      
45,487
      
29
  
 
Furniture and equipment
    
45,271
      
42,852
      
6
      
39,656
      
14
  
 
Office
    
16,808
      
16,303
      
3
      
14,398
      
17
  
 
Marketing
    
10,694
      
10,433
      
3
      
11,699
       (9 )
 
Other
    
85,002
      
67,366
      
26
      
71,914
      
18
  
 
     Total noninterest expenses
    
387,895
      
362,785
      
7
      
333,784
      
16
  
                                           
 
Income before income taxes
    
118,952
      
119,622
       (1 )    
120,609
       (1 )
 
Provision for federal and state income taxes
    
42,049
      
41,686
      
1
      
41,089
      
2
  
 
Net income
   $
76,903
     $
77,936
       (1 )%   $
79,520
       (3 )%
                                           
 
Net income per common and common equivalent share:
                                  
 
   Basic
   $
0.40
     $
0.41
       (2 )%   $
0.43
       (7 )%
 
   Diluted
   $
0.39
     $
0.40
       (3 )   $
0.41
       (5 )
 
Average common and common equivalent shares outstanding:
                                  
 
   Basic
    
191,552
      
189,278
      
1
      
184,437
      
4
  
 
   Diluted
    
197,462
      
196,505
      
0
      
193,842
      
2
  
 
Cash dividends, common stock
   $
0.13
     $
0.13
       0 %   $
0.12
       8 %
                                           
 
Return on average assets
     0.65 %     0.68 %             0.76 %        
 
Return on average equity
    
10.57
      
10.87
              
12.83
          
 
 
Commerce Bancorp, Inc. and Subsidiaries
Selected Consolidated Financial Data
(unaudited) 
 
     
Three Months Ended 
  
Six Months Ended 
     
June 30, 
  
June 30, 
             
% 
          
% 
     
2007
  
2006
  
Change
  
2007
  
2006
  
Change
     
(dollars and shares in thousands)
    
(dollars and shares in thousands) 
                               
Income Statement Data:
                          
 
Net interest income
$342,825
  
$318,937
  
          7
%
  
$675,781
  
$626,867
  
          8
%
 
Provision for credit losses
12,550
  
7,500
  
        67
    
22,550
  
14,001
  
        61
  
 
Noninterest income
176,572
  
142,956
  
        24
    
336,023
  
273,958
  
        23
  
 
Total revenues
519,397
  
461,893
  
        12
    
1,011,804
  
900,825
  
        12
  
 
Noninterest expense
387,895
  
333,784
  
        16
    
750,680
  
649,118
  
        16
  
 
Net income
76,903
  
79,520
  
        (3
 )   
154,839
  
156,817
  
        (1
 ) 
                               
                               
Per Share Data:
                          
 
Net income - Basic
$0.40
  
$0.43
  
        (7
)%
  
$0.81
  
$0.86
  
        (6
)%
 
Net income - Diluted
0.39
  
0.41
  
        (5
 )   
0.79
  
0.82
  
        (4
 ) 
                               
 
Book value - Basic
              
$15.05
  
$13.60
  
        11
%
 
Book value - Diluted
              
14.55
  
12.96
  
        12
  
                               
 
Revenue per share - Diluted
$10.52
  
$9.53
  
        10
%
  
$10.27
  
$9.39
  
          9
%
                               
 
Weighted Average Shares Outstanding:
                          
   
Basic
191,552
  
184,437
        
190,421
  
182,686
      
   
Diluted
197,462
  
193,842
        
196,987
  
191,914
      
                               
Balance Sheet Data:
                          
                               
 
Total assets
              
$48,175,525
  
$43,436,299
  
        11
%
 
Loans (net)
              
16,206,885
  
14,132,780
  
        15
  
 
Allowance for credit losses
              
169,459
  
148,383
  
        14
  
 
Securities available for sale
              
13,221,171
  
11,074,128
  
        19
  
 
Securities held to maturity
              
14,585,714
  
14,415,921
  
          1
  
 
Total deposits
              
44,388,265
  
38,049,762
  
        17
  
 
Core deposits
              
43,013,805
  
36,783,874
  
        17
  
 
Stockholders' equity
              
2,892,724
  
2,526,360
  
        15
  
                               
Capital:
                          
                               
 
Stockholders' equity to total assets
              
6.00
%
5.82
%
    
                               
 
Risk-based capital ratios:
                          
   
Tier I
              
11.72
  
11.81
      
   
Total capital
              
12.43
  
12.53
      
                               
 
Leverage ratio
              
6.06
  
6.03
      
                               
Performance Ratios:
                          
                               
 
Cost of funds
2.89
%
2.54
%
      
2.88
%
2.41
%
    
 
Net interest margin
3.22
  
3.39
        
3.25
  
3.46
      
 
Return on average assets
0.65
  
0.76
        
0.66
  
0.77
      
 
Return on average total stockholders' equity
10.57
  
12.83
        
10.72
  
12.92
      
 
The following summary presents information regarding non-performing loans and assets as of June 30, 2007 and the preceding
four quarters (dollar amounts in thousands).        

       
June 30,
  
March 31,
  
December 31,
  
September 30,
  
June 30,
       
2007
  
2007
  
2006
  
2006
  
2006
Non-accrual loans:
                  
 
Commercial
$22,381
  
$20,526
  
$33,686
  
$33,658
  
$34,904
 
Consumer
              15,462
  
              15,343
  
              11,820
  
                9,325
  
                8,927
 
Commercial real estate:
                  
   
Construction
                8,509
  
                8,575
  
                3,531
  
                   496
  
                1,708
   
Mortgage
                4,328
  
                2,277
  
                1,565
  
                1,828
  
                2,523
     
Total non-accrual loans
              50,680
  
              46,721
  
              50,602
  
              45,307
  
              48,062
                         
Restructured loans:
                  
 
Commercial
                      -
  
                      -
  
                      -
  
                      -
  
                2,941
 
Consumer
                      -
  
                      -
  
                      -
  
                      -
  
                      -
 
Commercial real estate:
                  
   
Construction
                      -
  
                      -
  
                      -
  
                      -
  
                      -
   
Mortgage
                      -
  
                      -
  
                      -
  
                      -
  
                      -
     
Total restructured loans
                      -
  
                      -
  
                      -
  
                      -
  
                2,941
                         
 
Total non-performing loans
              50,680
  
              46,721
  
              50,602
  
              45,307
  
              51,003
                         
Other real estate/foreclosed assets
                5,235
  
                5,000
  
                2,610
  
                2,022
  
                1,369
                         
Total non-performing assets
              55,915
  
              51,721
  
              53,212
  
              47,329
  
              52,372
                         
Loans past due 90 days or more
                  
 
and still accruing
                   965
  
                   658
  
                   620
  
                   441
  
                   583
                         
Total non-performing assets and
                  
 
loans past due 90 days or more
$56,880
  
$52,379
  
$53,832
  
$47,770
  
$52,955
                         
Total non-performing loans as a
                  
 
percentage of total period-end
                  
 
loans
0.31%
  
0.29%
  
0.32%
  
0.31%
  
0.36%
                         
Total non-performing assets as a
                  
 
percentage of total period-end assets
0.12%
  
0.11%
  
0.12%
  
0.11%
  
0.12%
                         
Total non-performing assets and loans
                  
 
past due 90 days or more as a
                  
 
percentage of total period-end assets
0.12%
  
0.11%
  
0.12%
  
0.11%
  
0.12%
                         
Allowance for credit losses as a
                  
 
percentage of total non-performing
                  
 
loans
334%
  
351%
  
317%
  
341%
  
291%
                         
Allowance for credit losses as a percentage
                
 
of total period-end loans
1.04%
  
1.03%
  
1.03%
  
1.05%
  
1.04%
                         
Total non-performing assets and loans
                  
 
past due 90 days or more as a
                  
 
percentage of stockholders' equity and
                  
 
allowance for credit losses
2%
  
2%
  
2%
  
2%
  
2%
The following table presents, for the periods indicated, an analysis of the allowance for credit losses and other    
related data:  (dollar amounts in thousands)          

   
Three Months Ended
  
Six Months Ended
  
Year
Ended
  
   
06/30/07
  
06/30/06
  
06/30/07
  
06/30/06
  
12/31/06
  
                       
                       
                       
Balance at beginning of period
$164,057
  
$142,913
  
$160,269
  
$141,464
  
$141,464
  
Provisions charged to operating expenses
         12,550
  
           7,500
  
         22,550
  
         14,001
  
             33,700
  
   
       176,607
  
       150,413
  
       182,819
  
       155,465
  
           175,164
  
                       
Recoveries on loans charged-off:
                    
 
Commercial
           1,065
  
           2,095
  
           2,186
  
           2,628
  
               5,987
  
 
Consumer
              330
  
              624
  
              619
  
           1,135
  
               1,604
  
 
Commercial real estate
                62
  
              317
  
              297
  
              318
  
                  385
  
Total recoveries
           1,457
  
           3,036
  
           3,102
  
           4,081
  
               7,976
  
                       
Loans charged-off:
                    
 
Commercial
         (5,951)
  
         (3,028)
  
       (10,245)
  
         (7,214)
  
           (14,107)
  
 
Consumer
         (2,570)
  
         (1,972)
  
         (5,544)
  
         (3,684)
  
             (8,179)
  
 
Commercial real estate
              (84)
  
              (66)
  
            (673)
  
            (265)
  
                (585)
  
Total charge-offs
         (8,605)
  
         (5,066)
  
       (16,462)
  
       (11,163)
  
           (22,871)
  
Net charge-offs
         (7,148)
  
         (2,030)
  
       (13,360)
  
         (7,082)
  
           (14,895)
  
                       
                       
Balance at end of period
$169,459
  
$148,383
  
$169,459
  
$148,383
  
$160,269
  
                       
                       
                       
Net charge-offs as a percentage of
                    
average loans outstanding
             0.18
 %
             0.06
 %
             0.17
 %
             0.11
 %
                 0.11
 %
                       
                       
Net Allowance Additions
$5,402
  
$5,470
  
$9,190
  
$6,919
  
$18,805
  
Commerce Bancorp, Inc. and Subsidiaries Average Balances and Net Interest Income
(unaudited)
 
                                         
                                         
 
 June 2007 
  
 March 2007 
  
 June 2006 
 
Average
      
Average
  
Average
      
Average
  
Average
      
Average
 
Balance
  
Interest
  
Rate 
  
Balance
  
Interest
  
Rate 
  
Balance
  
Interest
  
Rate 
(dollars in thousands)
                                        
Earning Assets
                                        
Investment securities
                                        
  Taxable
$26,645,741
  
$369,794
  
5.57
%
  
$25,237,398
  
$348,630
  
5.60
%
  
$23,851,645
  
$319,271
  
5.37
%
  Tax-exempt
571,408
  
8,415
  
5.91
    
611,725
  
8,984
  
5.96
    
559,733
  
7,322
  
5.25
  
  Trading
105,198
  
1,509
  
5.75
    
96,838
  
1,290
  
5.40
    
113,049
  
1,525
  
5.41
  
Total investment securities
27,322,347
  
379,718
  
5.57
    
25,945,961
  
358,904
  
5.61
    
24,524,427
  
328,118
  
5.37
  
Federal funds sold
150,675
  
2,000
  
5.32
    
436,031
  
5,733
  
5.33
    
19,898
  
250
  
5.04
  
Loans
                                        
  Commercial mortgages
5,443,872
  
96,125
  
7.08
    
5,447,516
  
95,522
  
7.11
    
4,784,584
  
83,903
  
7.03
  
  Commercial
4,143,332
  
80,595
  
7.80
    
4,024,615
  
77,457
  
7.81
    
3,492,946
  
66,879
  
7.68
  
  Consumer
5,947,306
  
95,002
  
6.41
    
5,711,130
  
90,500
  
6.43
    
5,115,609
  
80,560
  
6.32
  
  Tax-exempt
615,035
  
10,987
  
7.17
    
599,202
  
11,217
  
7.59
    
498,492
  
8,535
  
6.87
  
Total loans
16,149,545
  
282,709
  
7.02
    
15,782,463
  
274,696
  
7.06
    
13,891,631
  
239,877
  
6.93
  
                                         
Total earning assets
$43,622,567
  
$664,427
  
6.11
%
  
$42,164,455
  
$639,333
  
6.14
%
  
$38,435,956
  
$568,245
  
5.93
%
                                         
Sources of Funds
                                        
Interest-bearing liabilities
                                        
  Savings
$10,455,936
  
$72,954
  
2.80
%
  
$10,448,840
  
$72,118
  
2.80
%
  
$10,344,463
  
$64,157
  
2.49
%
  Interest bearing demand
19,173,873
  
177,289
  
3.71
    
17,886,395
  
163,742
  
3.71
    
14,597,277
  
118,085
  
3.24
  
  Time deposits
4,152,221
  
46,518
  
4.49
    
3,999,233
  
43,284
  
4.39
    
3,088,653
  
25,949
  
3.37
  
  Public funds
1,079,122
  
14,003
  
5.20
    
1,197,869
  
15,579
  
5.27
    
1,224,298
  
15,225
  
4.99
  
     Total deposits
34,861,152
  
310,764
  
3.58
    
33,532,337
  
294,723
  
3.56
    
29,254,691
  
223,416
  
3.06
  
                                         
  Other borrowed money
267,542
  
3,519
  
5.28
    
314,552
  
4,132
  
5.33
    
1,624,229
  
19,809
  
4.89
  
Total deposits and interest-bearing liabilities
35,128,694
  
314,283
  
3.59
    
33,846,889
  
298,855
  
3.58
    
30,878,920
  
243,225
  
3.16
  
                                         
Noninterest-bearing funds (net)
8,493,873
            
8,317,566
            
7,557,036
          
Total sources to fund earning assets
$43,622,567
  
314,283
  
2.89
    
$42,164,455
  
298,855
  
2.87
    
$38,435,956
  
243,225
  
2.54
  
                                         
Net interest income and
                                        
     margin tax-equivalent basis
    
$350,144
  
3.22
%
      
$340,478
  
3.27
%
      
$325,020
  
3.39
%
                                         
Other Balances
                                        
Cash and due from banks
$1,213,084
            
$1,182,810
            
$1,278,137
          
Other assets
2,754,125
            
2,613,080
            
2,314,307
          
Total assets
47,430,063
            
45,804,220
            
41,888,789
          
Total deposits
43,869,934
            
42,232,192
            
37,486,585
          
Demand deposits (noninterest-bearing)
9,008,782
            
8,699,855
            
8,231,894
          
Other liabilities
382,676
            
390,627
            
299,622
          
Stockholders' equity
2,909,911
            
2,866,849
            
2,478,353
          
Allowance for loan losses
159,713
            
156,125
            
139,611
          
                                         
                                         
                                         
Notes  -Weighted average yields on tax-exempt obligations have been computed on a tax-equivalent basis assuming a federal tax rate of 35%.     
          -Non-accrual loans have been included in the average loan balance.                 
          -Consumer loans include loans held for sale.                   
 
 
Commerce Bancorp, Inc. and Subsidiaries
Computation of Net Income Per Share
(dollars in thousands, except per share amounts)
 
   
Three Months Ended
  
Six Months Ended
   
 June 30,
  
 June 30,
                 
   
2007
  
2006
  
2007
  
2006
Basic:
                
Net income applicable to common stock
  
$76,903
  
$79,520
  
$154,839
  
$156,817
                 
Average common shares outstanding
  
191,552
  
184,437
  
190,421
  
182,686
                 
Net income per common share
  
$0.40
  
$0.43
  
$0.81
  
$0.86
                 
                 
                 
                 
                 
Diluted:
                
Net income applicable to common stock
  
$76,903
  
$79,520
  
$154,839
  
$156,817
                 
                 
Average common shares outstanding
  
191,552
  
184,437
  
190,421
  
182,686
Additional shares considered in diluted
                
     computation assuming:
                
        Exercise of stock options
  
5,910
  
9,405
  
6,566
  
9,228
                 
Average common and common equivalent
                
     shares outstanding
  
197,462
  
193,842
  
196,987
  
191,914
                 
Net income per common and common
                
     equivalent share
  
$0.39
  
$0.41
  
$0.79
  
$0.82
 
 
 
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