Business Context and Reporting Period
This Form 8-K filing by Commerce Bancshares, Inc. (CBSH) reports on executive compensation decisions made on February 3, 2026. The filing details the approval of 2026 base salaries, 2025 performance-based cash bonuses, and new long-term incentive award structures for the Company's Named Executive Officers (NEOs).
Key Financial Metrics and Compensation Data
The filing does not provide consolidated financial metrics such as revenue, profit, cash flow, margins, debt, or liquidity. Instead, it discloses specific compensation figures for the 2025 performance period and 2026 fiscal year:
| Executive Officer | Title | 2026 Base Salary | 2025 Performance Bonus | Performance-Vested RSUs | Time-Vested RSUs |
|---|---|---|---|---|---|
| John W. Kemper | President & CEO | $1,050,000 | $2,313,108 | 36,076 | 18,038 |
| Charles G. Kim | Executive Vice President & CFO | $619,126 | $802,483 | 5,931 | 4,831 |
| Kevin G. Barth | Executive Vice President | $619,126 | $802,483 | 5,931 | 2,965 |
| Robert S. Holmes | Executive Vice President | $547,690 | $683,315 | 5,349 | 3,607 |
| John K. Handy | Executive Vice President | $547,690 | $662,918 | 6,005 | 7,667 |
Material Changes and New Incentive Design
The Compensation and Human Resources Committee approved a new design for 2026 long-term incentive awards under the Equity Incentive Plan. Key structural changes include:
- Award Split: Awards are split into one-third (33.3%) time-vested Restricted Stock Units (RSUs) and two-thirds (66.6%) performance-vested RSUs.
- Performance Metrics: Performance-vested RSUs are based on two equally weighted metrics: Adjusted Return on Average Equity (excluding AOCI) and Diluted Earnings Per Share Growth (before extraordinary items).
- Payout Range: Actual units earned may range from 0% to 200% of target based on performance relative to a defined compensation peer group.
- TSR Modifier: A Total Shareholder Return (TSR) modifier may adjust earned units up or down by 20% based on relative three-year TSR performance.
Management Commentary and Risks
Management notes that unvested RSUs are generally forfeited upon termination, with exceptions for death, disability, retirement, or change in control. The award agreements include provisions regarding non-solicitation of employees and customers, as well as prohibitions on hedging and short-sale transactions involving Company securities.
Investor Verification Checklist
- Verify the specific performance targets and peer group definitions for the 2026 performance-vested RSUs in the upcoming Form 10-K.
- Review the full Award Agreements (to be filed as exhibits to the 2025 Form 10-K) for detailed vesting schedules and forfeiture conditions.
- Confirm the impact of the new TSR modifier on potential executive payout variability.
- Monitor future filings for the actual vesting outcomes of the 2025 performance bonuses and 2026 grants.