Commerce Bancshares (CBSH) 8-K COMMERCE BANCSHARES, INC. REPORTS EARNINGS PER SHARE GROWTH OF 10% for 2004

Exhibit 99.1

FOR IMMEDIATE RELEASE:
Thursday, January 13, 2005

COMMERCE BANCSHARES, INC. REPORTS
EARNINGS PER SHARE GROWTH OF 10% for 2004

     Commerce Bancshares, Inc. announced record earnings of $3.10 per share in 2004 compared to $2.81 per share in 2003, an increase of 10%. Total net income for 2004 amounted to $220.3 million compared to $206.5 million earned in 2003. For the year, the return on assets was 1.6%, the return on equity totaled 15.2% and the efficiency ratio totaled 59.2%.

     For the fourth quarter, earnings per share amounted to $.75, compared to $.74 for the same period last year, while total net income for the quarter amounted to $52.7 million compared with $53.9 million last year. The return on average assets for the fourth quarter 2004 was 1.5% and the return on equity for the quarter was 14.4%.

     In announcing these results, David W. Kemper, Chairman and CEO, said, “We are pleased to report the 20^th consecutive year of record earnings. These results were achieved despite a year when both the balance sheet and net interest income did not grow, chiefly due to sluggish loan demand and constraints from a rising interest rate environment. However, our focus in payment systems fee businesses, especially bank card and deposit account services, contributed to an 8% increase in non-interest income, which now comprises 40% of total revenue. Non-interest expense grew a modest 2% compared with the previous year, while a 9% decline in loan charge-offs reduced our credit costs. As a result, net income increased 7% over 2003.”

     Mr. Kemper added, “Asset quality remains strong with our allowance for loan losses totaling over $132 million and representing 1.59% of total loans. Net loan charge-offs for 2004 totaled $33.2 million, compared to $36.6 million in the previous year. Also non-performing assets, which totaled $18.8 million at December 31, 2004, declined over 40% compared with amounts recorded in the previous year.”

     Total assets at December 31, 2004 were $14.3 billion, total loans were $8.3 billion, and total deposits were $10.4 billion. At December 31, 2004, the allowance for loan losses represented 751% of non-performing loans. Net loan charge-offs for the year totaled .41% of average loans outstanding, down from .46% last year, and non-performing assets were .23% of total loans.

     During the fourth quarter, the Company declared and paid its eleventh consecutive annual 5% stock dividend.

(more)

     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 330 banking locations in Missouri, Illinois, and Kansas. The Company also has operating subsidiaries involved in mortgage banking, credit related insurance, venture capital, leasing and real estate activities.

     Posted to the Company’s web site is management’s discussion of fourth quarter results. To see this information, please visit our web site atwww.commercebank.com.

* * * * * * * * * * * * * * *

For additional information, contact
Jeffery Aberdeen, Controller
at PO Box 13686, Kansas City, MO
or by telephone at (816) 234-2081
Web Site: http://www.commercebank.com
Email: mymoney@commercebank.com

(Amounts in thousands)		9/30/04			12/31/04			12/31/03
Non-Accrual Loans	$	25,554		$	17,618		$	32,523
Foreclosed Real Estate		$1,540			$1,157			$1,162
Total Non-Performing Assets	$	27,094		$	18,775		$	33,685
Non-Performing Assets to Loans		.33	%		.23	%		.41	%
Non-Performing Assets to
Total Assets		.19	%		.13	%		.24	%
Loans 90 Days & Over Past Due — Still Accruing	$	17,625		$	13,067		$	20,901

COMMERCE BANCSHARES, INC. and SUBSIDIARIES
FINANCIAL HIGHLIGHTS

		For the Three Months Ended									For the Year Ended
(Unaudited)		Sept. 30			Dec. 31			Dec. 31			Dec. 31			Dec. 31
		2004			2004			2003			2004			2003
FINANCIAL SUMMARY(In thousands, except per share data)
Net interest income		$	123,684		$	124,202		$	127,507		$	497,331		$	502,392
Taxable equivalent net interest income			124,262			124,738			128,149			499,597			505,399
Non-interest income			78,920			77,753			76,420			326,931			301,667
Provision for loan losses			6,606			7,215			11,002			30,351			40,676
Non-interest expense			120,492			122,429			116,765			482,769			472,144
Net income			62,519			52,660			53,861			220,341			206,524
Cash dividends			15,218			15,076			14,613			61,135			51,266
Net total loan charge-offs			6,367			8,184			8,482			33,178			36,573
Net business charge-offs (recov)			100			128			(1,112	)		5,460			4,928
Net credit card charge-offs			4,658			4,983			5,389			19,615			19,664
Net personal banking charge-offs*	1,993					2,251			2,468			7,476			8,470
Net real estate charge-offs (recov)	(638			)		453			730			(10	)		858
Net overdraft charge-offs			254			369			1,007			637			2,653
Per share:
Net income — basic		$	0.89		$	0.77		$	0.75		$	3.15		$	2.84
Net income — diluted		$	0.88		$	0.75		$	0.74		$	3.10		$	2.81
Cash dividends		$	0.219		$	0.219		$	0.204		$	0.876		$	0.707
Diluted wtd. average shares o/s			70,700			70,029			72,855			71,066			73,617
RATIOS
Average loans to deposits			77.83	%		79.03	%		79.38	%		78.71	%		79.96	%
Return on total average assets			1.78	%		1.48	%		1.54	%		1.56	%		1.52	%
Return on total average stockholders’ equity			17.41	%		14.40	%		14.77	%		15.19	%		14.27	%
Non-interest income to revenue**			38.95	%		38.50	%		37.47	%		39.66	%		37.52	%
Efficiency ratio***			59.22	%		60.26	%		56.82	%		59.16	%		58.83	%
AT PERIOD END
Book value per share based on total stockholders’ equity		$	21.03		$	20.90		$	20.35
Market value per share		$	45.80		$	50.20		$	46.69
Allowance for loan losses as a percentage of loans			1.63	%		1.59	%		1.66	%
Tier I leverage ratio			9.77	%		9.60	%		9.71	%
Common shares outstanding			69,401,603			68,257,531			71,286,031
Shareholders of record			4,786			4,776			4,920
Number of bank/ATM locations			329			330			328
Number of bank charters			3			3			4
Full-time equivalent employees			4,821			4,821			4,967
					Dec. 31			Dec. 31
OTHER YTD INFORMATION						2004			2003
High market value per share					$	50.24		$	46.99
Low market value per share					$	41.90		$	31.93

* Includes consumer, student and home equity loans
** Revenue includes net interest income and non-interest income.
*** The efficiency ratio is calculated as non-interest expense (excluding intangibles amortization) as a percent of
net interest income and non-interest income (excluding gains/losses on securities transactions).

COMMERCE BANCSHARES, INC. and SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)	For the Three Months Ended									For the Year Ended
(In thousands, except per share data)	Sept. 30			Dec. 31			Dec. 31			Dec. 31		Dec. 31
	2004			2004			2003			2004		2003
INTEREST INCOME
Interest and fees on loans	$	106,218		$	112,358		$	105,737		$	425,338	$	433,495
Interest on investment securities		44,945			44,555			47,646			183,440		183,084
Interest on federal funds sold and securities purchased under agreements to resell		429			358			266			1,312		831
Total interest income		151,592			157,271			153,649			610,090		617,410
INTEREST EXPENSE
Interest on deposits:
Savings, interest checking and money market		7,130			8,335			6,263			27,957		28,742
Time open and C.D.’s of less than $100,000		9,525			9,908			10,525			38,924		48,440
Time open and C.D.’s of $100,000 and over		3,883			4,193			3,064			14,912		14,278
Interest on other borrowings		7,370			10,633			6,290			30,966		23,558
Total interest expense		27,908			33,069			26,142			112,759		115,018
Net interest income		123,684			124,202			127,507			497,331		502,392
Provision for loan losses		6,606			7,215			11,002			30,351		40,676
Net interest income after provision for loan losses		117,078			116,987			116,505			466,980		461,716
NON-INTEREST INCOME
Trust fees		16,047			15,918			15,877			64,257		60,921
Deposit account charges and other fees		27,072			25,858			27,890			105,382		97,711
Bank card transaction fees		19,676			21,629			17,428			78,253		67,102
Trading account profits and commissions		2,812			2,680			3,127			12,288		14,740
Consumer brokerage services		2,376			2,328			2,284			9,429		9,095
Mortgage banking revenue		545			534			449			1,841		4,007
Net gains (losses) on securities transactions		(148	)		(544	)		(777	)		11,092		4,560
Other		10,540			9,350			10,142			44,389		43,531
Total non-interest income		78,920			77,753			76,420			326,931		301,667
NON-INTEREST EXPENSE
Salaries and employee benefits		65,549			66,208			64,964			265,469		264,599
Net occupancy		9,740			9,818			9,508			39,558		38,736
Equipment		5,634			5,733			6,168			22,903		24,104
Supplies and communication		9,153			8,321			7,995			33,760		33,474
Data processing and software		11,469			12,099			10,499			46,000		40,567
Marketing		4,552			4,008			3,398			16,688		14,397
Other intangible assets amortization		431			399			442			1,699		1,794
Other		13,964			15,843			13,791			56,692		54,473
Total non-interest expense		120,492			122,429			116,765			482,769		472,144
Income before income taxes		75,506			72,311			76,160			311,142		291,239
Less income taxes		12,987			19,651			22,299			90,801		84,715
NET INCOME	$	62,519		$	52,660		$	53,861		$	220,341	$	206,524
Net income per share — basic	$	0.89		$	0.77		$	0.75		$	3.15	$	2.84
Net income per share — diluted	$	0.88		$	0.75		$	0.74		$	3.10	$	2.81
Cash dividends per common share	$	0.219		$	0.219		$	0.204		$	0.876	$	0.707

COMMERCE BANCSHARES, INC. and SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS

(Unaudited)	Sept. 30			Dec. 31			Dec. 31
(In thousands)	2004			2004			2003
ASSETS
Loans, net of unearned income	$	8,162,845		$	8,305,359		$	8,142,679
Allowance for loan losses		(133,363	)		(132,394	)		(135,221	)
Net loans		8,029,482			8,172,965			8,007,458
Investment securities:
Available for sale		4,775,883			4,754,941			4,956,668
Trading		29,803			9,403			9,356
Non-marketable		73,298			73,024			73,170
Total investment securities		4,878,984			4,837,368			5,039,194
Federal funds sold and securities purchased under agreements to resell		117,505			68,905			108,120
Cash and due from banks		533,856			585,815			567,123
Land, buildings and equipment — net		341,904			336,446			336,366
Goodwill		48,522			48,522			48,522
Other intangible assets — net		889			499			2,184
Other assets		195,016			199,848			178,197
Total assets	$	14,146,158		$	14,250,368		$	14,287,164
LIABILITIES AND STOCKHOLDERS’ EQUITY
Deposits:
Non-interest bearing demand	$	1,750,318		$	1,943,771		$	1,716,214
Savings, interest checking and money market		6,110,594			6,072,115			6,080,543
Time open and C.D.’s of less than $100,000		1,654,399			1,656,002			1,730,237
Time open and C.D.’s of $100,000 and over		766,260			762,421			679,214
Total deposits		10,281,571			10,434,309			10,206,208
Federal funds purchased and securities sold under agreements to repurchase		1,863,059			1,913,878			2,106,044
Other borrowings		392,586			389,542			403,853
Other liabilities		149,278			85,759			120,105
Total liabilities		12,686,494			12,823,488			12,836,210
Stockholders’ equity:
Preferred stock		—			—			—
Common stock		343,183			347,049			343,183
Capital surplus		353,705			392,156			359,300
Retained earnings		828,758			703,293			707,136
Treasury stock		(115,190	)		(51,646	)		(29,573	)
Other		(2,706	)		(3,542	)		(1,963	)
Accumulated other comprehensive income		51,914			39,570			72,871
Total stockholders’ equity		1,459,664			1,426,880			1,450,954
Total liabilities and stockholders’ equity	$	14,146,158		$	14,250,368		$	14,287,164

COMMERCE BANCSHARES, INC. and SUBSIDIARIES
AVERAGE BALANCES

(Unaudited)	For the Three Months Ended									For the Year Ended
(Dollars in thousands)	Sept. 30			Dec. 31			Dec. 31			Dec. 31			Dec. 31
	2004			2004			2003			2004			2003
Loans:
Business	$	2,032,375		$	2,129,818		$	1,996,813		$	2,071,128		$	2,137,250
Real estate — construction		426,562			420,179			410,272			427,976			404,058
Real estate — business		1,806,227			1,755,767			1,870,190			1,823,302			1,831,575
Real estate — personal		1,338,895			1,339,865			1,335,977			1,334,859			1,304,677
Consumer		1,210,117			1,205,381			1,162,362			1,188,018			1,129,267
Home equity		390,005			405,830			343,058			381,111			324,375
Student		289,730			344,258			347,595			326,120			339,577
Credit card		571,264			576,658			538,310			564,280			527,049
Overdrafts		10,659			14,379			10,755			13,319			11,631
Total loans		8,075,834			8,192,135			8,015,332			8,130,113			8,009,459
Investment securities (excluding unrealized gains and losses):
Available for sale		4,695,510			4,707,651			4,693,803			4,802,083			4,348,969
Trading		10,326			13,145			9,368			14,250			17,003
Non-marketable		75,123			74,744			77,549			75,542			74,501
Total investment securities		4,780,959			4,795,540			4,780,720			4,891,875			4,440,473
Federal funds sold and securities purchased under agreements to resell		101,152			63,769			85,505			84,113			63,232
Total interest earning assets		12,957,945			13,051,444			12,881,557			13,106,101			12,513,164
Total assets		13,969,121			14,112,455			13,885,498			14,149,156			13,542,758
Deposits:
Non-interest bearing deposits		1,292,276			1,351,240			1,183,899			1,288,434			1,083,207
Interest bearing deposits:
Savings		406,112			397,679			388,448			401,935			380,323
Interest checking		516,021			552,036			435,975			513,612			404,193
Money market		5,689,247			5,653,086			5,699,117			5,657,844			5,611,634
Time open & C.D.’s of less than $100,000		1,657,022			1,657,463			1,755,471			1,678,659			1,838,137
Time open & C.D.’s of $100,000 and over		814,984			753,928			634,196			788,800			699,241
Total interest bearing deposits		9,083,386			9,014,192			8,913,207			9,040,850			8,933,528
Total deposits		10,375,662			10,365,432			10,097,106			10,329,284			10,016,735
Borrowings:
Federal funds purchased and securities sold under agreements to repurchase		1,661,568			1,791,567			1,812,998			1,827,428			1,550,211
Long-term debt and other borrowings		392,374			390,150			411,382			419,215			395,026
Total borrowings		2,053,942			2,181,717			2,224,380			2,246,643			1,945,237
Total interest bearing liabilities		11,137,328			11,195,909			11,137,587			11,287,493			10,878,765
Total stockholders’ equity		1,428,908			1,455,062			1,446,380			1,450,181			1,446,973
Net yield on interest earning assets (tax-equivalent basis)		3.82	%		3.80	%		3.95	%		3.81	%		4.04	%

COMMERCE BANCSHARES, INC.
Management Discussion of Fourth Quarter Results
December 31, 2004

For the quarter ended December 31, 2004, net income amounted to $52.7 million, a decrease of 2.2% from the amount reported in the 4th quarter of the previous year. Net income was 15.8% lower than the previous quarter. For the quarter, return on assets was 1.48%, the return on equity totaled 14.4% and the efficiency ratio was 60.3%. Compared to the 4th quarter of last year, net interest income declined 2.6% and expenses grew by 4.9%, but the provision for loan losses was 34.4% lower. Compared to the 3rd quarter of 2004, net income declined mainly due to tax benefits of $5.0 million recorded in the 4th quarter of 2004 compared to $14.0 million in the previous quarter.

Balance Sheet Review
During the 4th quarter, average loans grew by 1.4%, or $116.3 million, compared to the 3rd quarter of 2004 and were up 2.2% compared with the same quarter last year. The growth in average loans over the 3rd quarter was due mostly to growth in business, student and home equity loans which grew by $97.4 million, $54.5 million, and $15.8 million, respectively, while business real estate loans and construction loans declined by $50.5 million and $6.4 million, respectively. The increase in business loans resulted from added borrowings from existing customers and new customer activity, while the decline in business real estate loans this quarter resulted from loan pay-downs and customer re-financing activities. Growth in student lending in the 4th quarter resulted from seasonal demand.

Available for sale investment securities, excluding fair value adjustments, increased on average by $12.1 million, or 0.3%, this quarter compared with the previous quarter. Available for sale securities maturing during the 4th quarter totaled $51.5 million while the principal amount of securities sold was $59.2 million. Principal prepayments of mortgage and asset-backed securities totaled $235.5 million. Investment securities purchased totaled $357.1 million and were principally comprised of mortgage-backed securities ($175.5 million), asset-backed securities ($83.1 million) and agency securities ($62.4 million).

Total average deposits decreased $10.2 million during the 4th quarter compared to the 3rd quarter of this year. During the 4th quarter, average non-interest bearing deposits increased $59.0 million, or 4.6%, and interest checking accounts increased $36.0 million, or 7.0%. However, these increases were offset by lower balances in money market deposit accounts and certificates of deposit over $100,000, which declined $36.2 million and $61.1 million, respectively.

During the current quarter, average borrowings increased $127.8 million over the prior quarter. Most of the increase occurred in federal funds purchased, required to support higher loan levels.

The average loans to deposits ratio for the quarter increased to 79.0% in the 4th quarter of 2004 compared to 77.8% in the previous quarter. The increase in this ratio resulted from increases in average loan balances coupled with decreases in average deposit balances.

Net Interest Income
In the 4th quarter, net interest income amounted to $124.2 million, a slight increase from the previous quarter, and $3.3 million or 2.6% lower than in the 4th quarter of last year. For the three months ended December 31, 2004, the net yield on earning assets decreased 2 basis points from the previous quarter to 3.80%.

The slight increase in net interest income in the 4th quarter compared to the 3rd quarter of 2004 was the result of higher earnings on all lending products of the Company, as a result of recent increases in rates by the Federal Reserve. In addition, growth in loans, especially business and student loans, helped increase interest income this quarter. These increases were offset, however, by higher rates paid on money market deposit accounts coupled with increased rates and balances on federal funds purchased. Also, overall rates earned in the Company’s investment portfolio declined slightly, mainly due to lower rates on securities purchased during the year.

During the quarter, rates on borrowings increased by 52 basis points to 1.95% as a result of the higher rate environment and its effects on federal funds purchased. Compared to the 3rd quarter of 2004, average rates earned on earning assets increased 14 basis points while rates paid on interest bearing liabilities increased 18 basis points.

Non-Interest Income
For the 4th quarter of 2004, total non-interest income amounted to $77.8 million compared with $76.4 million in the same quarter last year, an increase of 1.7%. This increase resulted principally from growth in bank card transaction fees, but was partly offset by a decline in deposit and bond trading account fees. Bank card fees for the quarter increased 24.1% over the same period last year due to strong growth in fees earned on merchant, debit card and credit card transactions. Debit card fees grew 41.2% and bank card fees grew 18.7%, while merchant fees increased over 10%. Trust fee income was slightly higher than the previous year due to an increase in personal trust fees. Deposit account fees were down $2.0 million compared with the previous year due to lower corporate cash management fee income and lower overdraft volumes. Other non-interest income included gains on sales of student loans in the 4th quarter of 2004 of $578 thousand compared to $1.6

COMMERCE BANCSHARES, INC.
Management Discussion of Fourth Quarter Results
December 31, 2004

million in the previous quarter and $919 thousand in the same quarter last year.

Net securities losses amounted to $544 thousand for the 4th quarter of 2004, compared to net losses of $148 thousand in the 3rd quarter of 2004 and net losses of $777 thousand in the 4th quarter of last year. These losses were mainly due to fair value adjustments on non-marketable investments held by the Company’s private equity subsidiaries.

Non-Interest Expense
Non-interest expense for the quarter amounted to $122.4 million, an increase of $5.7 million, or 4.9%, compared with $116.8 million recorded in the 4th quarter of last year. Year to date, non-interest expense in 2004 grew only 2.3% over the previous year.

Compared with the 4th quarter of last year, salaries and benefits expense increased 1.9% as a result of higher salaries and incentive payments. Full-time equivalent employees totaled 4,821 and 4,967 at December 31, 2004 and 2003, respectively. Costs for equipment declined 7.1% due to lower depreciation, and costs for supplies and communication and occupancy grew 4.1% and 3.3% respectively, while marketing and data processing costs grew 17.9% and 15.2% respectively. The growth in data processing costs of $1.6 million over the 4th quarter of last year was the result of higher bank card processing costs (related to the higher bank card revenues) and technology software expense. Additionally, the increase in marketing costs occurred mainly from incentives paid on new product offerings and expanded marketing efforts.

Income Taxes
During the 4th quarter, income tax expense amounted to $19.7 million, an increase of $6.7 million over the previous quarter and $2.6 million less than the same quarter last year. The effective tax rate for the Company was 27.2% for the 4th quarter compared with 17.2% in the 3rd quarter of 2004 and 29.3% in the 4th quarter of 2003. The Company recognized tax benefits pertaining to certain corporate tax reorganization initiatives of $5.0 million in the 4th quarter of 2004 compared to $14.0 million in tax benefits recognized in the previous quarter. The Company has additional income tax benefits totaling approximately $13.7 million associated with other corporate reorganization activities, which will not be recognized into income until certain conditions are satisfied. It is projected that such conditions may be resolved as early as the 3rd quarter of 2005. It is not expected that material tax benefits of this nature will continue beyond 2005.

Credit Quality
Net loan charge-offs for the 4th quarter of 2004 amounted to $8.2 million compared with $6.4 million in the 3rd quarter of 2004 and $8.5 million in the 4th quarter of last year. The ratio of annualized net loan charge-offs to total average loans this quarter was .40% compared with .42% in the same quarter last year and .31% in the 3rd quarter of 2004. The increase in net charge-offs this quarter compared with the previous quarter was mainly the result of increases in personal and credit card net charge-offs coupled with lower recoveries on business real estate loans.

For the 4th quarter of 2004, annualized net charge-offs on average credit card loans amounted to 3.44%, compared to 3.24% in the previous quarter and 3.97% in the 4th quarter of last year. Personal loan charge-offs increased this quarter over the 3rd quarter, and amounted to .46% of average personal loans compared to .42% in the 3rd quarter of 2004 and .53% in the same period last year. The provision for loan losses for the current quarter totaled $7.2 million; an increase of $609 thousand over the provision recorded in the 3rd quarter of this year, and was down $3.8 million from the amount recorded in the 4th quarter of 2003. The allowance for loan losses at December 31, 2004 amounted to $132.4 million, or 1.59% of total loans, and represents 751% of total non-performing loans.

Total non-performing assets amounted to $18.8 million, a decrease of $8.3 million from the previous quarter (mainly due to a $6.0 million loan paydown), and amounted to .23% of total loans. Non-performing assets are comprised of non-accrual loans ($17.6 million) and foreclosed real estate ($1.2 million). Loans past due more than 90 days and still accruing interest totaled $13.1 million at December 31, 2004.

Other
The Company maintains a treasury stock buyback program; and effective October 2004, was authorized by the Board of Directors to repurchase up to 5 million shares of its common stock. During the quarter ended December 31, 2004, the Company purchased 1,269,000 shares of treasury stock at an average cost of $49.44 per share.

Forward Looking Information
This information contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements include future financial and operating results, expectations, intentions and other statements that are not historical facts. Such statements are based on current beliefs and expectations of the Company’s management and are subject to significant risks and uncertainties. Actual results may differ materially from those set forth in the forward-looking statements.