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Louis and Kansas City, which serve as central hubs for the Company.
−Removed: The Company also has offices in Dallas, Houston, Cincinnati, Nashville, Des Moines, Indianapolis, and Grand Rapids that support customers in its commercial and/or wealth segments and operates a commercial payments business with sales representatives covering the continental United States of America (“U.S.”).
+Added: The Company also has offices in Dallas, Houston, Cincinnati, Nashville, Des Moines, Indianapolis, Grand Rapids, and Naples that support customers in its commercial and/or wealth segments and operates a commercial payments business with sales representatives covering the continental United States of America (“U.S.”).
The Company’s goal is to be the preferred provider of financial services in its communities, based on strong customer relationships built through providing top quality service with a strong risk management culture, and employing a strong balance sheet with strong capital levels.
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The Company also uses regional advisory boards, comprised of local business leaders, professionals and other community representatives, who assist the Company in responding to local banking needs.
−Removed: In addition to this local market, community-based focus, the Company offers sophisticated financial products usually only available at much larger financial institutions.
+Added: In addition to this local market, community-based focus, the Company offers sophisticated financial products usually only available at larger financial institutions.
The markets the Bank serves are mainly located in the lower Midwest, which provides natural sites for production and distribution facilities and serve as transportation hubs.
The economy has been well-diversified in these markets with many major industries represented, including telecommunications, automobile, technology, financial services, aircraft and general manufacturing, health care, numerous service industries, and food and agricultural production.
−Removed: The personal real estate lending operations of the Bank are predominantly centered in its lower Midwestern markets.
+Added: The personal real estate lending operations of the Bank are predominantly centered in its principal markets.
From time to time, the Company evaluates the potential acquisition of various financial institutions.
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The Company seeks merger or acquisition partners that are culturally similar, have experienced management and either possess significant market presence or have potential for improved profitability through financial management, economies of scale and expanded services.
−Removed: The Company has not completed any bank acquisitions since 2013.
+Added: In the second quarter of 2023, the Company acquired L.J.
+Added: Hart & Company, a municipal bond underwriter and advisor.
Employees and Human Capital
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Job shadowing, leadership
−Removed: Table of Conte nts
development programs, Aspiring Managers program, Managing at Commerce, competency assessments and education assistance are just a few of the ways the Company helps team members excel.
−Removed: During the COVID-19 pandemic, the Company focused efforts on providing team members support and resources to navigate the ever-changing environment.
−Removed: Initiatives included routine communications providing relevant updates and information, resources for leaders to help keep their teams engaged and connected, new resources for working parents, and access to emotional support resources.
−Removed: The Company implemented a phased-in approach to returning to on-site work and created more flexible work categories for team members to provide for ongoing flexibility.
−Removed: While the most significant impacts of the pandemic appear to have passed, the Company continues to provide most of its team members flexible work schedules.
−Removed: The Company believes diversity, equity, and inclusion (DEI) builds stronger companies with better results.
−Removed: In 2022, the Company’s efforts continued around a key initiative focusing on DEI through the lens of our workforce, our suppliers, our community and our customers.
+Added: The Company believes inclusion builds stronger companies with better results and focuses its efforts around four key pillars:
+Added: its workforce, its suppliers, its community and its customers.
Internal teams continue to iterate to build plans for growth in all four areas.
The Company continues to build a sense of belonging by engaging team members in a variety of Employee Resource Groups (ERGs) to support its diverse workforce.
−Removed: RISE (empowering women), EMERGE (connecting young professionals), VIBE (valuing multicultural perspectives), PRIDE (engaging the LGBTQIA+ community), and SALUTE (supporting veterans) are important forums that provide team members opportunities to connect, learn, and encourage diverse perspectives.
+Added: RISE (empowering women), EMERGE (connecting young professionals), VIBE (valuing multicultural perspectives), PRIDE (engaging the LGBTQIA+ community), SALUTE (supporting veterans), and ENABLE (supporting team members with disabilities and their caregivers) are important forums that provide team members opportunities to connect, learn, and encourage diverse perspectives.
Participation in these ERGs is voluntary, and more than 40% of team members belong to one of these groups.
−Removed: Other internal DEI efforts have included unconscious bias training, book clubs, listen, talk, and learn sessions, courageous conversation training, mentoring programs, and review of talent at all levels of the organization.
The Company’s longstanding approach of “doing what’s right” continues to guide its focus on its team members and communities.
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Commercial, Consumer, and Wealth.
−Removed: The Commercial segment provides a full array of corporate lending, merchant and commercial bank card products, payment solutions, leasing, and international services, as well as business and government deposit, investment, and cash management services.
+Added: The Commercial segment provides a full array of corporate lending, merchant and commercial bank card products, payment solutions, leasing, and international services, as well as business and government deposit, investment, institutional brokerage, and cash management services.
The Consumer segment includes the retail branch network, consumer installment lending, personal mortgage banking, and consumer debit and credit bank card activities.
−Removed: The Wealth segment provides traditional trust and estate planning services, brokerage services, and advisory and discretionary investment portfolio management services to both personal and institutional corporate customers.
+Added: The Wealth segment provides traditional trust and estate planning services, consumer brokerage services, and advisory and discretionary investment portfolio management services to both personal and institutional corporate customers.
In 2023, the Commercial, Consumer and Wealth segments contributed 53%, 25% and 21% of total segment pre-tax income, respectively.
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government, and by policies of various regulatory authorities, including those of the numerous states in which they operate.
−Removed: These include, for example, the
−Removed: Table of Conte nts
−Removed: statutory minimum legal lending rates, domestic monetary policies of the Board of Governors of the Federal Reserve System, U.S.
+Added: These include, for example, the statutory minimum legal lending rates, domestic monetary policies of the Board of Governors of the Federal Reserve System, U.S.
fiscal policy, international currency regulations and monetary policies, the U.S.
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The GLB Act also included privacy provisions that limit banks’ abilities to disclose non-public information about customers to non-affiliated entities.
−Removed: Table of Conte nts
The Company must also comply with the requirements of the Bank Secrecy Act (BSA).
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In 2011, the FDIC released a final rule to implement provisions of the Dodd-Frank Act that affected deposit insurance assessments.
−Removed: Among other things, the Dodd-Frank Act raised the minimum designated reserve ratio from 1.15% to 1.35% of estimated insured deposits, removed the upper limit of the designated reserve ratio, required that the designated reserve ratio reach 1.35% by September 30, 2020, and required the FDIC to offset the effect of increasing the minimum designated reserve ratio on depository institutions with total assets of less than $10 billion.
−Removed: The Dodd-Frank Act provided the FDIC flexibility in the implementation of the increase in the designated reserve ratio and also required that the FDIC redefine the assessment base to average consolidated assets minus average tangible equity.
+Added: Among other things, the Dodd-Frank Act raised the minimum designated reserve ratio from 1.15% to 1.35% of estimated insured deposits, removed the upper limit of the designated reserve ratio, and required the FDIC to offset the effect of increasing the minimum designated reserve ratio on depository institutions with total assets of less than $10 billion.
Due to growth in insured deposits during the first half of 2020, the DIF reserve ratio fell below statutory minimum of 1.35% on June 30, 2022.
The FDIC Board of Directors adopted an Amended Restoration Plan in an effort to restore the reserve ratio to at least 1.35% by September 30, 2028.
−Removed: The FDIC Board also increased base deposit insurance assessment rates by 2 basis points, which takes effect on January 1, 2023.
+Added: The FDIC Board also increased base deposit insurance assessment rates by 2 basis points, which took effect on January 1, 2023.
+Added: In November 2023, the FDIC Board of Directors approved a final rule implementing a special assessment to recover the loss to the DIF associated with protecting uninsured depositors following the closures of Silicon Valley Bank and Signature Bank earlier in 2023.
+Added: As a result of the FDIC's approval of its final rule, the Company accrued $16.0 million in the fourth quarter of 2023 for the one-time special assessment.
For the year ended December 31, 2023, the Company's deposit insurance expense was $33.2 million.
−Removed: Table of Conte nts
Payment of Dividends
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The principal source of the Parent's cash revenues is cash dividends paid by the Bank.
−Removed: The amount of dividends paid by the Bank in any calendar year is limited to the net profit of the current year combined with the retained net profits of the preceding two years, and permission must be obtained from the Federal Reserve Board for dividends exceeding these amounts.
+Added: The amount of dividends paid by the Bank in any calendar year is limited to the net profit of the current year combined with the retained net profits of the preceding two years, and permission must be obtained from the Federal Reserve Board for
+Added: dividends exceeding these amounts.
The payment of dividends by the Bank may also be affected by factors such as the maintenance of adequate capital.
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On May 24, 2018, the Economic Growth, Regulatory Relief, and Consumer Protection Act was enacted, which eliminated the required stress testing under the Dodd-Frank Act for banks with consolidated assets of less than $250 billion.
−Removed: The Company continues to perform periodic stress-testing based on its own internal criteria.
+Added: While not required to perform stress testing, the Company continues to perform periodic stress-testing based on its own internal criteria.
Executive and Incentive Compensation
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The Federal Reserve Board has issued comprehensive guidance on incentive compensation intended to ensure that the incentive compensation policies do not undermine safety and soundness by encouraging excessive risk taking.
−Removed: This guidance covers all employees that have the ability to materially affect the risk profile of an organization, either individually or as part of a group, based on key principles that (i) incentives do not
−Removed: Table of Conte nts
−Removed: encourage risk-taking beyond the organization's ability to identify and manage risk, (ii) compensation arrangements are compatible with effective internal controls and risk management, and (iii) compensation arrangements are supported by strong corporate governance, including active and effective board oversight.
+Added: This guidance covers all employees that have the ability to materially affect the risk profile of an organization, either individually or as part of a group, based on key principles that (i) incentives do not encourage risk-taking beyond the organization's ability to identify and manage risk, (ii) compensation arrangements are compatible with effective internal controls and risk management, and (iii) compensation arrangements are supported by strong corporate governance, including active and effective board oversight.
Deficiencies in compensation practices may affect supervisory ratings and enforcement actions may be taken if incentive compensation arrangements pose a risk to safety and soundness.
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These filings include the annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and all amendments to those reports.
−Removed: Table of Conte nts
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.