CBSH

Commerce Bancshares is a model of conservative, high-return community banking. FY2025 net income rose 7.6% to $566M and diluted EPS grew 9.5% to $4.04, producing a 1.79% return on average assets and a 15.76% return on average common equity — figures at the top of the regional-bank peer set, where a 1%+ ROA is considered strong. Profitability is improving, not just durable: the net yield on interest-earning assets expanded to 3.63% (from 3.47%) and the efficiency ratio improved to 55.47% (from 57.37%), reflecting both better spreads and cost discipline.

Credit quality is exceptional and a key part of the bull case. Non-performing assets were just $17.0M, or 0.10% of loans, and net charge-offs averaged only 0.23% of loans — pristine by any standard and evidence of disciplined underwriting through the cycle. The balance sheet is conservatively funded (loans-to-deposits of 69.8%, ~30% non-interest-bearing deposits) with equity-to-assets rising to 11.34%, giving ample capital cushion. The 7.68x liabilities/equity ratio is simply the normal leverage of a well-capitalized bank, not a risk signal.