COMMERCE BANCSHARES, INC. REPORTS FIRST NINE MONTHS EARNINGS PER SHARE GROWTH OF 3%

View the Third Quarter 2006 earnings release.

Commerce Bancshares, Inc. announced earnings of $2.41 per share for the nine months ended September 30, 2006, an increase of 3% compared to $2.35 per share during the same period in 2005. Net income for the first nine months of 2006 amounted to $162.8 million compared with $167.0 million in the same period last year. The return on average assets for the first nine months ended September 30, 2006 was 1.56%, and the return on average equity was 16.1%. The efficiency ratio was 61.1%.

For the three months ended September 30, 2006, earnings per share totaled $.81, a decrease of 9% compared with $.89 in the third quarter of 2005. Net income amounted to $54.5 million compared with $62.8 million in the same period last year, which included non-recurring tax benefits of $10.3 million or $.14 per share. The return on average assets for the three months ended September 30, 2006 was 1.50% and the return on average equity was 15.6%.

In making this announcement, David W. Kemper, Chairman and CEO, said, “Despite a difficult interest rate environment, total revenues grew 3% for the first nine months when compared to the same period last year. Over this same period, average loans grew by 9%. This growth enhanced our earning asset mix while offsetting pressure on our interest margin. For the first nine months, fee revenue, led by our payment systems business, increased 6%. These factors, as well as low levels of net loan charge-offs, generated net income growth of 4% year over year, exclusive of one-time tax benefits recognized in the third quarter last year. Excluding these tax benefits, earnings per share for the first nine months of 2006 has grown 9%.”

Mr. Kemper added, “Asset quality remained strong in the third quarter with annualized net loan charge-offs totaling .33% of average loans compared with .42% in the same quarter last year, as a result of lower losses in our credit card loan portfolio. Our allowance for loan losses totaled $131.8 million, or 1.34% of total outstanding loans, at the end of the third quarter.”

Total assets at September 30, 2006 were $15.2 billion, total loans were $9.8 billion, and total deposits were $11.6 billion. At September 30, 2006, non-performing loans totaled $18.8 million or .19% of total loans. During the quarter, the Company completed the merger of West Pointe Bancorp, Inc., Belleville, Illinois, a one bank holding company with assets of $460 million, loans of $255 million and deposits of $381 million. Also, the Company completed the purchase of the banking business of Boone National Savings and Loan Association, Columbia, Missouri which had total loans and deposits of $127 million and $101 million, respectively.

Commerce Bancshares, Inc. is a registered bank holding company offering a full line of banking services, including investment management and securities brokerage. The Company currently operates in approximately 360 locations in Missouri, Illinois, and Kansas. The Company also has operating subsidiaries involved in mortgage banking, credit related insurance, venture capital, and real estate activities.

Summary of Non-Performing Assets and Past Due Loans:

This financial news release, including management’s discussion of second quarter results, is posted to the Company’s web site at: www.commercebank.com

For additional information contact:

Jeffery Aberdeen, Controller
PO Box 419248, Kansas City, MO
816.234.2081
Web Site: http://www.commercebank.com
Email: mymoney@commercebank.com