New
Jersey
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1-12069
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22-2433468
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(State
or other jurisdiction of incorporation or
organization)
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(Commission
File Number)
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(I.R.S.
Employer Identification
No.)
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Commerce
Atrium, 1701 Route 70 East, Cherry Hill, NJ
08034-5400
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(Address
of principal executive offices) (Zip
Code)
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Registrant’s
telephone number, including area code:
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(856)
751-9000
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I.
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Tell
us about the new 2007 J.D. Power Retail Banking Satisfaction
Study.
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A
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Commerce
ranked #1 for customer satisfaction in the Mid-Atlantic States,
and our
score was the highest of any bank surveyed in
America.
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II.
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What
is the status of the previously disclosed investigation being
conducted by
the Office of the Comptroller of the Currency (“OCC”) in conjunction with
the Board of Governors of the Federal Reserve
System?
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A
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The
Company continues to cooperate with the on-going
investigation.
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Commerce
Bank, N.A. (“the Bank”), the Company’s national bank subsidiary, has been
advised by the OCC that it expects the Bank to enter into a consent
order
relating to, among other items, corporate governance, related
party
transactions and policies and procedures for real estate related
transactions. The Company has also been advised by the Federal
Reserve Bank of Philadelphia that it expects the Company to enter
into an
informal memorandum of understanding related to certain of the
foregoing.
The Company cannot predict how or when the investigation will
be fully
resolved or how the consent order or memorandum of understanding
will
affect the operations of the
Company.
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III.
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Does
the Company intend to alter its related party
policies?
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A
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The
Company intends to terminate all continuing material related
party
transactions on or before December 31, 2007 and will enter into
no new
material relationships.
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This
includes all transactions as reported in our 2007 Proxy Statement
with the
exception of real estate leases executed in 2002 and
prior, normal lending and banking relationships, and the
completion of prior
commitments.
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•
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Adoption
of a new Real Estate
Policy.
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•
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Creation
of a Board Real Estate Committee and a Management Real Estate
Development
Committee.
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•
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The
recruitment of a senior executive as its new Director of Real
Estate.
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•
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Subject
to Board and regulatory approval, the Board’s Nominating & Governance
Committee previously recommended bringing in-house the services of
InterArch, the architectural and design company owned by the
wife of the
Chairman which has provided Commerce design services since
1973. It is contemplated that employees of InterArch
would become Bank
employees.
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IV.
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What
other actions are being taken by the Company to enhance its governance
practices?
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A
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•
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Nicholas
A. Giordano, formerly President of the Philadelphia Stock Exchange
and a
financial expert, was elected as a Director at the Company’s 2007 Annual
Meeting.
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•
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Additional
independent Directors are being
recruited.
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V.
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Are
new stores being approved?
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A
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The
OCC is reviewing new store applications. Although the Bank
cannot predict the timing, the Bank expects to receive
approvals.
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VI.
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What
is your new store plan for 2007 and
2008?
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A
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We
now expect to open 50-55 new stores in 2007, roughly equal to
2006.
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By
June 30, 2007, the Company expects to have opened 15+ stores in
2007.
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In
2008 the Company expects to increase its store base by 15% or
70+
new stores.
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The
Company has 175+ new sites in development in all its
markets.
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All
new store development is subject to various governmental
approvals.
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A
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At
the current shape of the yield curve, we expect our margin in
2007 to
range between 3.20% and
3.30%.
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Commerce
Bancorp, Inc.
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June
11, 2007
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By:
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/s/
Douglas J. Pauls
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Name:
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Douglas
J. Pauls
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Title:
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Executive
Vice President and Chief Financial Officer
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