Commerce Bancshares: ‘Full-Service Approach’ Drives Gains in Wealth Management Business

Commerce Bancshares grew its wealth management business in the fourth quarter after announcing new initiatives targeting that market.

The Missouri-based regional bank holding company said in a fourth-quarter earnings highlights presentation released Wednesday (Jan. 22) that its gains in revenue diversification were bolstered by its growing wealth business.

Commerce Bancshares said three months earlier, in a third-quarter investor update, that it was looking to grow its wealth management business by using its new private banking loan and deposit system to offer specialized products, services and automation, and expanding into new concentrated wealth markets through new efforts and acquisitions.

The bank’s efforts to growth the wealth management business also include expanding its referral strategy with affluent households, implementing an enhanced sales and service process, developing and recruiting its team, and investing in digital tools that “support a seamless client experience,” according to the presentation.

“For high-net-worth individuals who are looking to simplify their complex financial life, Commerce Trust Company provides a full-service approach to wealth management,” the company said in the investor update.

The bank now has $74.8 billion in assets under administration, up from $68.9 billion a year earlier, according to the presentations.

In terms of assets under management, it has moved up from 20th largest among bank-management trust companies in December 2023 to 19th largest, the presentations said, citing data from S&P Global Market Intelligence.

The bank has 142 branches and 253 ATMs across seven states. In addition, it has wealth management offices in three cities outside its core banking footprint: Dallas, Houston and Naples, Florida.

Commerce Bancshares’ latest gains came during a quarter in which its net income amounted to $136.1 million, compared with $109.2 million a year earlier and $138 million in the previous quarter, according to a Wednesday earnings release.

“Our fourth quarter earnings were strong, reflecting our resilient balance sheet, diversified operating model and well-controlled expenses,” Commerce Bancshares President and CEO John Kemper said in the release.

Kemper said that the bank’s quarterly net interest income grew, driven in part by growth in deposits and investment securities.

“Total non-interest income was 36.8% of total revenue,” he added. “Trust fees were strong and experienced continued growth, up 14.6% over the same period last year.”