**UNITED      STATES**

**SECURITIES      AND EXCHANGE COMMISSION**

**WASHINGTON,      D.C. 20549**

**Form      10-Q**

| (X)    | QUARTERLY                REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE                ACT OF                1934 |
|--------|--------------------------------------------------------------------------------------------------------------------------------------|
|   | For                the quarterly period ended June                30, 2005                                                           |

| (                ) | TRANSITION                REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE                ACT OF                1934 |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------|
|               | For                the transition period from ______________ to                ______________                                         |

| New                Jersey                      | 22-2433468                                  |
|------------------------------------------------|---------------------------------------------|
| (State                or other jurisdiction of | (IRS                Employer Identification |
| incorporation                or organization)  | Number)                                     |

| Commerce                Atrium, 1701 Route 70 East, Cherry Hill, New Jersey                08034-5400 |
|-------------------------------------------------------------------------------------------------------|
| (Address                of Principal Executive Offices) (Zip Code)                                    |
|                                                                                                  |
| (856)                751-9000                                                                         |
| (Registrant’s                telephone number, including area                code)              |

| Yes                X | No                __ |
|----------------------|----------------------|

| Yes                X | No                __ |
|----------------------|----------------------|

| Common                Stock     | 164,051,679                                                                    |
|---------------------------------|--------------------------------------------------------------------------------|
| (Title                of Class) | (No.                of Shares Outstanding as                of August 1, 2005) |

----

**COMMERCE      BANCORP, INC. AND SUBSIDIARIES**

|                    |                                                                                                      | Page   |
|-------------------------|-----------------------------------------------------------------------------------------------------------|--------|
| PART                I.  | FINANCIAL                INFORMATION                                                                      |   |
|                    |                                                                                                      |   |
| Item                1.  | Financial                Statements                                                                       |   |
|                    |                                                                                                      |   |
|                         | Consolidated                Balance Sheets (unaudited)                                                    |   |
|                    | June                30, 2005 and December 31, 2004                                                        | 1      |
|                    |                                                                                                      |   |
|                    | Consolidated                Statements of Income                (unaudited)                               |   |
|                    | Three                months ended June 30, 2005 and June 30, 2004                and                      |   |
|                    | six                months ended June 30, 2005 and June 30,                2004                            | 2      |
|                    |                                                                                                      |   |
|                         | Consolidated                Statements of Cash Flows                (unaudited)                           |   |
|                    | Six                months ended June 30, 2005 and June 30,                2004                            | 3      |
|                    |                                                                                                      |   |
|                    | Consolidated                Statement of Changes in Stockholders’                Equity (unaudited) |   |
|                    | Six                months ended June 30, 2005                                                             | 4      |
|                         |                                                                                                      |   |
|                    | Notes                to Consolidated Financial Statements                (unaudited)                      | 5      |
|                    |                                                                                                      |   |
| Item                2.  | Management’s                Discussion and Analysis of                Financial                     |   |
|                    | Condition                and Results of Operation                                                         | 10     |
|                    |                                                                                                      |   |
| Item                3.  | Quantitative                and Qualitative Disclosures About Market                Risk                  | 23     |
|                    |                                                                                                      |   |
| Item                4.  | Controls                and Procedures                                                                    | 24     |
|                    |                                                                                                      |   |
| PART                II. | OTHER                INFORMATION                                                                          |   |
|                    |                                                                                                      |   |
| Item                1.  | Legal                Proceedings                                                                          | 24     |
|                    |                                                                                                      |   |
| Item                4.  | Submission                of Matters to a Vote of Security                Holders                         | 25     |
|                    |                                                                                                      |   |
| Item                6.  | Exhibits                                                                                                  | 25     |
|                    |                                                                                                      |   |

----

**PART      1.**
**FINANCIAL      INFORMATION**

**Item      1.**
**Financial      Statements**

**COMMERCE      BANCORP, INC. AND SUBSIDIARIES**

**CONSOLIDATED      BALANCE SHEETS**

|                    |                                                               |   |                        |   |                            |       |
|-------------------------|--------------------------------------------------------------------|--------|-----------------------------|--------|---------------------------------|------------|
|                    |                                                               |   | **June                30,** |   | **December                31,** |       |
|                    | (dollars                in thousands)                              |   | **2005**                    |   |                            | **2004**   |   |
| **Assets**              | Cash                and due from banks                             | **$**  | **1,400,346**               |   | $                               | 1,050,806  |   |
|                    | Federal                funds sold                                  |   | **13,700**                  |   |                            |       |   |
|                    | Cash                and cash equivalents                           |   | **1,414,046**               |   |                            | 1,050,806  |   |
|                    | Loans                held for sale                                 |   | **314,437**                 |   |                            | 44,072     |   |
|                    | Trading                securities                                  |   | **183,894**                 |   |                            | 169,103    |   |
|                    | Securities                available for sale                       |   | **7,676,837**               |   |                            | 8,044,150  |   |
|                    | Securities                held to maturity                         |   | **11,708,266**              |   |                            | 10,463,658 |   |
|                    | (market                value 06/05-$11,692,632; 12/04-$10,430,451) |   |                        |   |                            |       |   |
|                    | Loans                                                              |   | **10,688,717**              |   |                            | 9,454,611  |   |
|                    | Less                allowance for loan losses                      |   | **141,325**                 |   |                            | 135,620    |   |
|                    |                                                               |   | **10,547,392**              |   |                            | 9,318,991  |   |
|                    | Bank                premises and equipment, net                    |   | **1,135,035**               |   |                            | 1,059,519  |   |
|                    | Other                assets                                        |   | **383,029**                 |   |                            | 351,346    |   |
|                    |                                                               | **$**  | **33,362,936**              |   | $                               | 30,501,645 |   |
|                    |                                                               |   |                        |   |                            |       |   |
| **Liabilities**         | Deposits:                                                          |   |                        |   |                            |       |   |
|                    | Demand:                                                            |   |                        |   |                            |       |   |
|                    | Noninterest-bearing                                                | **$**  | **7,540,381**               |   | $                               | 6,406,614  |   |
|                    | Interest-bearing                                                   |   | **11,966,515**              |   |                            | 11,604,066 |   |
|                    | Savings                                                            |   | **7,504,035**               |   |                            | 6,490,263  |   |
|                    | Time                                                               |   | **3,508,132**               |   |                            | 3,157,942  |   |
|                    | Total                deposits                                      |   | **30,519,063**              |   |                            | 27,658,885 |   |
|                    | Other                borrowed money                                |   | **567,346**                 |   |                            | 661,195    |   |
|                    | Other                liabilities                                   |   | **227,036**                 |   |                            | 315,860    |   |
|                    | Long-term                debt                                      |   | **200,000**                 |   |                            | 200,000    |   |
|                    |                                                               |   | **31,513,445**              |   |                            | 28,835,940 |   |
|                    |                                                               |   |                        |   |                            |       |   |
| **Stockholders’** | Common                stock, 164,178,009 shares                    |   |                        |   |                            |       |   |
| **Equity**              | issued                (160,635,618 shares in 2004)                 |   | **164,178**                 |   |                            | 160,636    |   |
|                    | Capital                in excess of par value                      |   | **1,024,851**               |   |                            | 951,476    |   |
|                    | Retained                earnings                                   |   | **664,803**                 |   |                            | 543,978    |   |
|                    | Accumulated                other comprehensive income              |   | **8,390**                   |   |                            | 20,953     |   |
|                    |                                                               |   | **1,862,222**               |   |                            | 1,677,043  |   |
|                    |                                                               |   |                        |   |                            |       |   |
|                    | Less                treasury stock, at cost, 838,758 shares        |   |                        |   |                            |       |   |
|                    | issued                (795,610 shares in 2004)                     |   | **12,731**                  |   |                            | 11,338     |   |
|                    | Total                stockholders’ equity                    |   | **1,849,491**               |   |                            | 1,665,705  |   |
|                    |                                                               | **$**  | **33,362,936**              |   | $                               | 30,501,645 |   |

See      accompanying notes.

----

**COMMERCE      BANCORP, INC. AND SUBSIDIARIES**

**CONSOLIDATED      STATEMENTS OF INCOME**

|            |                                                            |                                                             |        |   |                                                           |     |
|-----------------|-----------------------------------------------------------------|------------------------------------------------------------------|-------------|--------|----------------------------------------------------------------|----------|
|            |                                                            | **Three                Months Ended****June                30,** |        |   | **Six                Months Ended****June                30,** |     |
|            | (dollars                in thousands, except per share amounts) |                                                             | **2005**    |   |                                                           | **2004** |   |   | **2005** |   |   | **2004** |   |
| **Interest**    | Interest                and fees on loans                       | **$**                                                            | **161,839** |   | $                                                              | 113,947  |   | **$** | **307,057** |   | $ | 222,160 |   |
| **income**      | Interest                on investments                          |                                                             | **234,970** |   |                                                           | 177,929  |   |   | **459,916** |   |   | 341,428 |   |
|            | Other                interest                                   |                                                             | **889**     |   |                                                           | 154      |   |   | **1,205** |   |   | 494 |   |
|            | Total                interest income                            |                                                             | **397,698** |   |                                                           | 292,030  |   |   | **768,178** |   |   | 564,082 |   |
|            |                                                            |                                                             |        |   |                                                           |     |   |   |   |   |   |   |   |
| **Interest**    | Interest                on deposits:                            |                                                             |        |   |                                                           |     |   |   |   |   |   |   |   |
| **expense**     | Demand                                                          |                                                             | **53,755**  |   |                                                           | 18,729   |   |   | **100,426** |   |   | 34,672 |   |
|            | Savings                                                         |                                                             | **23,258**  |   |                                                           | 10,216   |   |   | **42,338** |   |   | 18,002 |   |
|            | Time                                                            |                                                             | **22,281**  |   |                                                           | 14,264   |   |   | **40,679** |   |   | 28,907 |   |
|            | Total                interest on deposits                       |                                                             | **99,294**  |   |                                                           | 43,209   |   |   | **183,443** |   |   | 81,581 |   |
|            | Interest                on other borrowed money                 |                                                             | **6,917**   |   |                                                           | 1,052    |   |   | **11,327** |   |   | 1,500 |   |
|            | Interest                on long-term debt                       |                                                             | **3,020**   |   |                                                           | 3,020    |   |   | **6,040** |   |   | 6,040 |   |
|            | Total                interest expense                           |                                                             | **109,231** |   |                                                           | 47,281   |   |   | **200,810** |   |   | 89,121 |   |
|            |                                                            |                                                             |        |   |                                                           |     |   |   |   |   |   |   |   |
|            | Net                interest income                              |                                                             | **288,467** |   |                                                           | 244,749  |   |   | **567,368** |   |   | 474,961 |   |
|            | Provision                for loan losses                        |                                                             | **4,500**   |   |                                                           | 10,748   |   |   | **10,750** |   |   | 20,248 |   |
|            | Net                interest income after provision for          |                                                             |        |   |                                                           |     |   |   |   |   |   |   |   |
|            | loan                losses                                      |                                                             | **283,967** |   |                                                           | 234,001  |   |   | **556,618** |   |   | 454,713 |   |
|            |                                                            |                                                             |        |   |                                                           |     |   |   |   |   |   |   |   |
| **Noninterest** | Deposit                charges and service fees                 |                                                             | **68,802**  |   |                                                           | 52,717   |   |   | **128,766** |   |   | 98,198 |   |
| **income**      | Other                operating income                           |                                                             | **42,152**  |   |                                                           | 38,923   |   |   | **84,769** |   |   | 79,250 |   |
|            | Net                investment securities gains                  |                                                             | **4,689**   |   |                                                           | 635      |   |   | **5,797** |   |   | 1,059 |   |
|            | Total                noninterest income                         |                                                             | **115,643** |   |                                                           | 92,275   |   |   | **219,332** |   |   | 178,507 |   |
|            |                                                            |                                                             |        |   |                                                           |     |   |   |   |   |   |   |   |
| **Noninterest** | Salaries                and benefits                            |                                                             | **127,552** |   |                                                           | 104,110  |   |   | **246,853** |   |   | 201,450 |   |
| **expense**     | Occupancy                                                       |                                                             | **39,110**  |   |                                                           | 27,949   |   |   | **77,103** |   |   | 56,059 |   |
|            | Furniture                and equipment                          |                                                             | **28,895**  |   |                                                           | 27,001   |   |   | **57,821** |   |   | 51,180 |   |
|            | Office                                                          |                                                             | **12,577**  |   |                                                           | 10,920   |   |   | **25,254** |   |   | 21,840 |   |
|            | Marketing                                                       |                                                             | **8,456**   |   |                                                           | 9,278    |   |   | **14,257** |   |   | 17,974 |   |
|            | Other                                                           |                                                             | **61,909**  |   |                                                           | 46,997   |   |   | **115,617** |   |   | 90,002 |   |
|            | Total                noninterest expenses                       |                                                             | **278,499** |   |                                                           | 226,255  |   |   | **536,905** |   |   | 438,505 |   |
|            |                                                            |                                                             |        |   |                                                           |     |   |   |   |   |   |   |   |
|            | Income                before income taxes                       |                                                             | **121,111** |   |                                                           | 100,021  |   |   | **239,045** |   |   | 194,715 |   |
|            | Provision                for federal and state income taxes     |                                                             | **41,702**  |   |                                                           | 33,786   |   |   | **82,499** |   |   | 66,505 |   |
|            | Net                income                                       | **$**                                                            | **79,409**  |   | $                                                              | 66,235   |   | **$** | **156,546** |   | $ | 128,210 |   |
|            |                                                            |                                                             |        |   |                                                           |     |   |   |   |   |   |   |   |
|            | Net                income per common and common                 |                                                             |        |   |                                                           |     |   |   |   |   |   |   |   |
|            | equivalent                share:                                |                                                             |        |   |                                                           |     |   |   |   |   |   |   |   |
|            | Basic                                                           | **$**                                                            | **0.49**    |   | $                                                              | 0.42     |   | **$** | **0.97** |   | $ | 0.82 |   |
|            | Diluted                                                         | **$**                                                            | **0.46**    |   | $                                                              | 0.40     |   | **$** | **0.91** |   | $ | 0.77 |   |
|            | Average                common and common equivalent             |                                                             |        |   |                                                           |     |   |   |   |   |   |   |   |
|            | shares                outstanding:                              |                                                             |        |   |                                                           |     |   |   |   |   |   |   |   |
|            | Basic                                                           |                                                             | **162,287** |   |                                                           | 155,960  |   |   | **161,547** |   |   | 155,144 |   |
|            | Diluted                                                         |                                                             | **177,202** |   |                                                           | 172,520  |   |   | **176,724** |   |   | 171,787 |   |
|            | Dividends                declared, common stock                 | **$**                                                            | **0.11**    |   | $                                                              | 0.10     |   | **$** | **0.22** |   | $ | 0.19 |   |

See      accompanying notes.

----

**COMMERCE      BANCORP, INC. AND SUBSIDIARIES**

**CONSOLIDATED      STATEMENTS OF CASH FLOWS**

|           |                                                                                                                   |   |                                                           |   |
|----------------|------------------------------------------------------------------------------------------------------------------------|--------|----------------------------------------------------------------|--------|
|           |                                                                                                                   |   | **Six                Months Ended****June                30,** |   |
|           | (dollars                in thousands)                                                                                  |   | **2005**                                                       |   |   | **2004** |   |
| **Operating**  | Net                income                                                                                              | **$**  | **156,546**                                                    |   | $ | 128,210 |   |
| **activities** | Adjustments                to reconcile net income to net cash                                                         |   |                                                           |   |   |   |   |
|           | provided                by operating activities:                                                                       |   |                                                           |   |   |   |   |
|           | Provision                for loan losses                                                                               |   | **10,750**                                                     |   |   | 20,248 |   |
|           | Provision                for depreciation, amortization and accretion                                                  |   | **75,851**                                                     |   |   | 63,429 |   |
|           | Gain                on sales of securities                                                                             |   | **(5,797**                                                     | **)**  |   | (1,059 | ) |
|           | Proceeds                from sales of loans held for sale                                                              |   | **346,381**                                                    |   |   | 408,006 |   |
|           | Originations                of loans held for sale                                                                     |   | **(367,246**                                                   | **)**  |   | (406,284 | ) |
|           | Net                increase in trading securities                                                                      |   | **(14,791**                                                    | **)**  |   | (11,647 | ) |
|           | Increase                in other assets, net                                                                           |   | **(24,914**                                                    | **)**  |   | (35,859 | ) |
|           | Decrease                in other liabilities                                                                           |   | **(89,165**                                                    | **)**  |   | (14,414 | ) |
|           | Net                cash provided by operating activities                                                               |   | **87,615**                                                     |   |   | 150,630 |   |
|           |                                                                                                                   |   |                                                           |   |   |   |   |
| **Investing**  | Proceeds                from the sales of securities available for sale                                                |   | **1,751,170**                                                  |   |   | 1,656,912 |   |
| **activities** | Proceeds                from the maturity of securities available for sale                                             |   | **1,462,746**                                                  |   |   | 2,228,796 |   |
|           | Proceeds                from the maturity of securities held to maturity                                               |   | **1,184,845**                                                  |   |   | 407,486 |   |
|           | Purchase                of securities available for sale                                                               |   | **(2,875,296**                                                 | **)**  |   | (5,569,909 | ) |
|           | Purchase                of securities held to maturity                                                                 |   | **(2,438,003**                                                 | **)**  |   | (1,690,817 | ) |
|           | Net                increase in loans                                                                                   |   | **(1,488,651**                                                 | **)**  |   | (897,497 | ) |
|           | Capital                expenditures                                                                                    |   | **(127,658**                                                   | **)**  |   | (136,731 | ) |
|           | Net                cash used by investing activities                                                                   |   | **(2,530,847**                                                 | **)**  |   | (4,001,760 | ) |
|           |                                                                                                                   |   |                                                           |   |   |   |   |
| **Financing**  | Net                increase in demand and savings deposits                                                             |   | **2,509,988**                                                  |   |   | 3,481,226 |   |
| **activities** | Net                increase (decrease) in time deposits                                                                |   | **350,190**                                                    |   |   | (120,878 | ) |
|           | Net                (decrease) increase in other borrowed money                                                         |   | **(93,849**                                                    | **)**  |   | 632,530 |   |
|           | Dividends                paid                                                                                          |   | **(35,378**                                                    | **)**  |   | (29,315 | ) |
|           | Proceeds                from issuance of common stock under dividend                reinvestment and other stock plans |   |  **76,914**                                               |   |   |  69,433 |   |
|           | Other                                                                                                                  |   | **(1,393**                                                     | **)**  |   | (1,999 | ) |
|           | Net                cash provided by financing activities                                                               |   | **2,806,472**                                                  |   |   | 4,030,997 |   |
|           |                                                                                                                   |   |                                                           |   |   |   |   |
|           | Increase                in cash and cash equivalents                                                                   |   | **363,240**                                                    |   |   | 179,867 |   |
|           | Cash                and cash equivalents at beginning of year                                                          |   | **1,050,806**                                                  |   |   | 910,092 |   |
|           | Cash                and cash equivalents at end of period                                                              | **$**  | **1,414,046**                                                  |   | $ | 1,089,959 |   |
|           |                                                                                                                   |   |                                                           |   |   |   |   |
|           | Supplemental                disclosures of cash flow information:                                                      |   |                                                           |   |   |   |   |
|           | Cash                paid during the period for:                                                                        |   |                                                           |   |   |   |   |
|           | Interest                                                                                                               | **$**  | **198,427**                                                    |   | $ | 89,705 |   |
|           | Income                taxes                                                                                            |   | **75,370**                                                     |   |   | 63,339 |   |
|           | Other                noncash activities:                                                                               |   |                                                           |   |   |   |   |
|           | Transfer                of loans to held for sale                                                                      |   | **249,500**                                                    |   |   |   |   |

See      accompanying notes.

----

**COMMERCE      BANCORP, INC. AND SUBSIDIARIES**

**CONSOLIDATED      STATEMENT OF CHANGES IN STOCKHOLDERS’ EQUITY**

| Six                months ended June 30, 2005                    |         |   |                          |   |         |   |         |   |                             |   |           |   |
|------------------------------------------------------------------|--------------|--------|-------------------------------|--------|--------------|--------|--------------|--------|----------------------------------|--------|----------------|--------|
| *(in                thousands)*                                  |         |   |                          |   |         |   |         |   |                             |   |           |   |
|                                                             |         |   | **Capital                in** |   |         |   |         |   | **Accumulated**                  |   |           |   |
|                                                             |         |   | **Excess                of**  |   |         |   |         |   | **Other**                        |   |           |   |
|                                                             | **Common**   |   | **Par**                       |   | **Retained** |   | **Treasury** |   | **Comprehensive**                |   |           |   |
|                                                             | **Stock**    |   | **Value**                     |   | **Earnings** |   | **Stock**    |   | **Income                (Loss)** |   | **Total**      |   |
|                                                             |         |   |                          |   |         |   |         |   |                             |   |           |   |
| **Balances                at December 31, 2004**                 | **$160,636** |   | **$951,476**                  |   | **$543,978** |   | **$(11,338** | **)**  | **$20,953**                      |   | **$1,665,705** |   |
| Net                income                                        |         |   |                          |   | 156,546      |   |         |   |                             |   | 156,546        |   |
| Other                comprehensive (loss) income, net of tax     |         |   |                          |   |         |   |         |   |                             |   |           |   |
| Unrealized                loss on securities (pre-tax $22,932)   |         |   |                          |   |         |   |         |   | (14,711                          | )      | (14,711        | )      |
| Reclassification                adjustment (pre-tax $3,304)      |         |   |                          |   |         |   |         |   | 2,148                            |   | 2,148          |   |
| Other                comprehensive loss                          |         |   |                          |   |         |   |         |   |                             |   | (12,563        | )      |
| Total                comprehensive income                        |         |   |                          |   |         |   |         |   |                             |   | 143,983        |   |
| Cash                dividends                                    |         |   |                          |   | (35,718      | )      |         |   |                             |   | (35,718        | )      |
| Shares                issued under dividend reinvestment         |         |   |                          |   |         |   |         |   |                             |   |           |   |
| and                compensation and benefit plans (3,542 shares) | 3,542        |   | 73,372                        |   |         |   |         |   |                             |   | 76,914         |   |
| Other                                                            |         |   | 3                             |   | (3           | )      | (1,393       | )      |                             |   | (1,393         | )      |
| **Balances                at June 30, 2005**                     | **$164,178** |   | **$1,024,851**                |   | **$664,803** |   | **$(12,731** | **)**  | **$8,390**                       |   | **$1,849,491** |   |

See      accompanying notes.

----

**COMMERCE      BANCORP, INC. AND SUBSIDIARIES**

**NOTESTO      CONSOLIDATED FINANCIAL STATEMENTS**

**A.**
**Consolidated      Financial Statements**

**B.**
**Long      Term Debt**

----

**C.      **
**Bank      Premises and Equipment**

**D.**
**Commitments**

**E.**
**Comprehensive      Income (Loss)**

**F.**
**New      Accounting Standards**

----

**G.**
**Stock-Based      Compensation**

|                                                          |                                                             |     |                                                           |   |
|---------------------------------------------------------------|------------------------------------------------------------------|----------|----------------------------------------------------------------|--------|
|                                                          | **Three                Months Ended****June                30,** |     | **Six                Months Ended****June                30,** |   |
|                                                          |                                                             | **2005** |                                                           |   | **2004** |   |   | **2005** |   |   | **2004** |   |
| Reported                net income                            | $                                                                | 79,409   |                                                           | $      | 66,235 |   | $ | 156,546 |   | $ | 128,210 |   |
| Less:                Stock option compensation expense        |                                                             |     |                                                           |   |   |   |   |   |   |   |   |   |
| determined                under fair value method, net of tax |                                                             | (4,031   | )                                                              |   | (3,090 | ) |   | (8,062 | ) |   | (6,510 | ) |
| Pro                forma net income, basic                    | $                                                                | 75,378   |                                                           | $      | 63,145 |   | $ | 148,484 |   | $ | 121,700 |   |
| Add:                Interest expense on Convertible Trust     |                                                             |     |                                                           |   |   |   |   |   |   |   |   |   |
| Capital                Securities, net of tax                 |                                                             | 1,963    |                                                           |   | 1,963 |   |   | 3,926 |   |   | 3,926 |   |
| Pro                forma net income, diluted                  | $                                                                | 77,341   |                                                           | $      | 65,108 |   | $ | 152,410 |   | $ | 125,626 |   |
|                                                          |                                                             |     |                                                           |   |   |   |   |   |   |   |   |   |
| Reported                net income per share:                 |                                                             |     |                                                           |   |   |   |   |   |   |   |   |   |
| Basic                                                         | $                                                                | 0.49     |                                                           | $      | 0.42 |   | $ | 0.97 |   | $ | 0.82 |   |
| Diluted                                                       | $                                                                | 0.46     |                                                           | $      | 0.40 |   | $ | 0.91 |   | $ | 0.77 |   |
|                                                          |                                                             |     |                                                           |   |   |   |   |   |   |   |   |   |
| Pro                forma net income per share:                |                                                             |     |                                                           |   |   |   |   |   |   |   |   |   |
| Basic                                                         | $                                                                | 0.46     |                                                           | $      | 0.40 |   | $ | 0.92 |   | $ | 0.78 |   |
| Diluted                                                       | $                                                                | 0.44     |                                                           | $      | 0.38 |   | $ | 0.86 |   | $ | 0.73 |   |

----

**H.      **
**Segment      Information**

|                                               |                                                                  |      |                                                                  |        |
|----------------------------------------------------|-----------------------------------------------------------------------|-----------|-----------------------------------------------------------------------|-------------|
|                                               | **Three                Months Ended****June                30, 2005** |      | **Three                Months Ended****June                30, 2004** |        |
|                                               | **Community**                                                         |      |                                                                  | **Parent/** |   |   |   |   | **Community** |   |   | **Parent/** |   |   |   |   |
|                                               |                                                                  | **Banks** |                                                                  |        | **Other** |   |   | **Total** |   |   | **Banks** |   |   | **Other** |   |   | **Total** |   |
| Net                interest income                 | $                                                                     | 289,859   |                                                                  | $           | (                1,392 | ) | $ | 288,467 |   | $ | 246,385 |   | $ | (1,636 | ) | $ | 244,749 |   |
| Provision                for loan losses           |                                                                  | 4,500     |                                                                  |        | - |   |   | 4,500 |   |   | 10,748 |   |   | - |   |   | 10,748 |   |
| Net                interest income after provision |                                                                  | 285,359   |                                                                  |        | (1,392 | ) |   | 283,967 |   |   | 235,637 |   |   | (1,636 | ) |   | 234,001 |   |
| Noninterest                income                  |                                                                  | 89,923    |                                                                  |        | 25,720 |   |   | 115,643 |   |   | 66,836 |   |   | 25,439 |   |   | 92,275 |   |
| Noninterest                expense                 |                                                                  | 257,899   |                                                                  |        | 20,600 |   |   | 278,499 |   |   | 203,155 |   |   | 23,100 |   |   | 226,255 |   |
| Income                before income taxes          |                                                                  | 117,383   |                                                                  |        | 3,728 |   |   | 121,111 |   |   | 99,318 |   |   | 703 |   |   | 100,021 |   |
| Income                tax expense                  |                                                                  | 40,537    |                                                                  |        | 1,165 |   |   | 41,702 |   |   | 33,917 |   |   | (131 | ) |   | 33,786 |   |
| Net                income                          | $                                                                     | 76,846    |                                                                  | $           | 2,563 |   | $ | 79,409 |   | $ | 65,401 |   | $ | 834 |   | $ | 66,235 |   |
|                                               |                                                                  |      |                                                                  |        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Average                assets (in millions)        | $                                                                     | 30,225    |                                                                  | $           | 2,538 |   | $ | 32,763 |   | $ | 23,778 |   | $ | 2,044 |   | $ | 25,822 |   |

|                                               |                                                                |      |                                                                |        |
|----------------------------------------------------|---------------------------------------------------------------------|-----------|---------------------------------------------------------------------|-------------|
|                                               | **Six                Months Ended****June                30, 2005** |      | **Six                Months Ended****June                30, 2004** |        |
|                                               | **Community**                                                       |      |                                                                | **Parent/** |   |   |   |   | **Community** |   |   | **Parent/** |   |   |   |   |
|                                               |                                                                | **Banks** |                                                                |        | **Other** |   |   | **Total** |   |   | **Banks** |   |   | **Other** |   |   | **Total** |   |
| Net                interest income                 | $                                                                   | 570,814   |                                                                | $           | (                3,446 | ) | $ | 567,368 |   | $ | 478,221 |   | $ | (3,260 | ) | $ | 474,961 |   |
| Provision                for loan losses           |                                                                | 10,750    |                                                                |        | - |   |   | 10,750 |   |   | 20,248 |   |   |   |   |   | 20,248 |   |
| Net                interest income after provision |                                                                | 560,064   |                                                                |        | (3,446 | ) |   | 556,618 |   |   | 457,973 |   |   | (3,260 | ) |   | 454,713 |   |
| Noninterest                income                  |                                                                | 165,219   |                                                                |        | 54,113 |   |   | 219,332 |   |   | 124,969 |   |   | 53,538 |   |   | 178,507 |   |
| Noninterest                expense                 |                                                                | 494,668   |                                                                |        | 42,237 |   |   | 536,905 |   |   | 392,508 |   |   | 45,997 |   |   | 438,505 |   |
| Income                before income taxes          |                                                                | 230,615   |                                                                |        | 8,430 |   |   | 239,045 |   |   | 190,434 |   |   | 4,281 |   |   | 194,715 |   |
| Income                tax expense                  |                                                                | 79,629    |                                                                |        | 2,870 |   |   | 82,499 |   |   | 65,124 |   |   | 1,381 |   |   | 66,505 |   |
| Net                income                          | $                                                                   | 150,986   |                                                                | $           | 5,560 |   | $ | 156,546 |   | $ | 125,310 |   | $ | 2,900 |   | $ | 128,210 |   |
|                                               |                                                                |      |                                                                |        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Average                assets (in millions)        | $                                                                   | 29,475    |                                                                | $           | 2,460 |   | $ | 31,935 |   | $ | 22,596 |   | $ | 2,060 |   | $ | 24,656 |   |

----

**I.**
**Net      Income Per Share**

|                                                                         |                                                             |     |                                                           |   |
|------------------------------------------------------------------------------|------------------------------------------------------------------|----------|----------------------------------------------------------------|--------|
|                                                                         | **Three                Months Ended****June                30,** |     | **Six                Months Ended****June                30,** |   |
|                                                                         |                                                             | **2005** |                                                           |   | **2004** |   |   | **2005** |   |   | **2004** |   |
|                                                                         |                                                             |     |                                                           |   |   |   |   |   |   |   |   |   |
| **Basic:**                                                                   |                                                             |     |                                                           |   |   |   |   |   |   |   |   |   |
| Net                income available to common shareholders - basic           | $                                                                | 79,409   |                                                           | $      | 66,235 |   | $ | 156,546 |   | $ | 128,210 |   |
| Average                common shares outstanding - basic                     |                                                             | 162,287  |                                                           |   | 155,960 |   |   | 161,547 |   |   | 155,144 |   |
| Net                income per common share - basic                           | $                                                                | 0.49     |                                                           | $      | 0.42 |   | $ | 0.97 |   | $ | 0.82 |   |
|                                                                         |                                                             |     |                                                           |   |   |   |   |   |   |   |   |   |
| **Diluted:**                                                                 |                                                             |     |                                                           |   |   |   |   |   |   |   |   |   |
| Net                income                                                    | $                                                                | 79,409   |                                                           | $      | 66,235 |   | $ | 156,546 |   | $ | 128,210 |   |
| Add                interest expense on Convertible Trust Capital Securities, |                                                             |     |                                                           |   |   |   |   |   |   |   |   |   |
| net                of tax                                                    |                                                             | 1,963    |                                                           |   | 1,963 |   |   | 3,926 |   |   | 3,926 |   |
| Net                income available to common shareholders - diluted         | $                                                                | 81,372   |                                                           | $      | 68,198 |   | $ | 160,472 |   | $ | 132,136 |   |
|                                                                         |                                                             |     |                                                           |   |   |   |   |   |   |   |   |   |
|                                                                         |                                                             |     |                                                           |   |   |   |   |   |   |   |   |   |
| Average                common shares outstanding                             |                                                             | 162,287  |                                                           |   | 155,960 |   |   | 161,547 |   |   | 155,144 |   |
| Additional                shares considered in diluted computation assuming: |                                                             |     |                                                           |   |   |   |   |   |   |   |   |   |
| Exercise                of stock options                                     |                                                             | 7,333    |                                                           |   | 8,978 |   |   | 7,595 |   |   | 9,061 |   |
| Conversion                of Convertible Trust Capital Securities            |                                                             | 7,582    |                                                           |   | 7,582 |   |   | 7,582 |   |   | 7,582 |   |
| Average                common shares outstanding - diluted                   |                                                             | 177,202  |                                                           |   | 172,520 |   |   | 176,724 |   |   | 171,787 |   |
|                                                                         |                                                             |     |                                                           |   |   |   |   |   |   |   |   |   |
| Net                income per common share - diluted                         | $                                                                | 0.46     |                                                           | $      | 0.40 |   | $ | 0.91 |   | $ | 0.77 |   |
|                                                                         |                                                             |     |                                                           |   |   |   |   |   |   |   |   |   |

**J.**
**Subsequent      Event**

----

**Item      2.**
**Management’s      Discussion and Analysis of Financial Condition and Results of      Operation**

**Executive      Summary**

**Capital      Resources**

|                                      |       |   | Per                Regulatory Guidelines |      |
|-------------------------------------------|------------|--------|------------------------------------------|-----------|
|                                      | Actual     |   | Minimum                                  |      | “Well                Capitalized” |   |
|                                      | Amount     | Ratio  |                                     | Amount    | Ratio |   | Amount | Ratio |   |
|                                      |       |   |                                     |      |   |   |   |   |   |
| **June                30, 2005:**         |       |   |                                     |      |   |   |   |   |   |
| Company                                   |       |   |                                     |      |   |   |   |   |   |
| Risk                based capital ratios: |       |   |                                     |      |   |   |   |   |   |
| Tier                1                     | $2,032,129 | 12.39  | %                                        | $656,250  | 4.00 | % | $984,375 | 6.00 | % |
| Total                capital              | 2,179,616  | 13.29  |                                     | 1,312,500 | 8.00 |   | 1,640,626 | 10.00 |   |
| Leverage                ratio             | 2,032,129  | 6.20   |                                     | 1,310,297 | 4.00 |   | 1,637,871 | 5.00 |   |
| Commerce                NJ                |       |   |                                     |      |   |   |   |   |   |
| Risk                based capital ratios: |       |   |                                     |      |   |   |   |   |   |
| Tier                1                     | $1,413,674 | 11.48  | %                                        | $492,571  | 4.00 | % | $738,856 | 6.00 | % |
| Total                capital              | 1,523,793  | 12.37  |                                     | 985,141   | 8.00 |   | 1,231,427 | 10.00 |   |
| Leverage                ratio             | 1,413,674  | 6.01   |                                     | 941,149   | 4.00 |   | 1,176,436 | 5.00 |   |
|                                      |       |   |                                     |      |   |   |   |   |   |

----

|                                      |       |   |    | Per                Regulatory Guidelines |                                          |
|-------------------------------------------|------------|--------|---------|------------------------------------------|-----------------------------------------------|
|                                      | Actual     |   | Minimum |                                     | “Well                Capitalized” |   |
|                                      | Amount     | Ratio  |    | Amount                                   | Ratio                                         |   | Amount | Ratio |   |
|                                      |       |   |    |                                     |                                          |   |   |   |   |
| **June                30, 2004:**         |       |   |    |                                     |                                          |   |   |   |   |
| Company                                   |       |   |    |                                     |                                          |   |   |   |   |
| Risk                based capital ratios: |       |   |    |                                     |                                          |   |   |   |   |
| Tier                1                     | $1,640,555 | 12.37  | %       | $530,388                                 | 4.00                                          | % | $795,582 | 6.00 | % |
| Total                capital              | 1,765,243  | 13.31  |    | 1,060,776                                | 8.00                                          |   | 1,325,970 | 10.00 |   |
| Leverage                ratio             | 1,640,555  | 6.33   |    | 1,036,022                                | 4.00                                          |   | 1,295,028 | 5.00 |   |
| Commerce                NJ                |       |   |    |                                     |                                          |   |   |   |   |
| Risk                based capital ratios: |       |   |    |                                     |                                          |   |   |   |   |
| Tier                1                     | $1,109,055 | 11.18  | %       | $396,693                                 | 4.00                                          | % | $595,039 | 6.00 | % |
| Total                capital              | 1,206,762  | 12.17  |    | 793,385                                  | 8.00                                          |   | 991,731 | 10.00 |   |
| Leverage                ratio             | 1,109,055  | 6.04   |    | 734,786                                  | 4.00                                          |   | 918,483 | 5.00 |   |

**Deposits**

|       |                                |                             |                                |                             |                                  |
|------------|-------------------------------------|----------------------------------|-------------------------------------|----------------------------------|---------------------------------------|
|       | **June                30,****2005** | **%                of****Total** | **June                30,****2004** | **%                of****Total** | **Annual****Growth                %** |
|       |                                |                             |                                |                             |                                  |
| Consumer   | $                13,250             | 45%                              | $                11,066             | 48%                              | 20%                                   |
|       |                                |                             |                                |                             |                                  |
| Commercial | 11,179                              | 38                               | 8,402                               | 36                               | 33                                    |
|       |                                |                             |                                |                             |                                  |
| Government | 5,196                               | 17                               | 3,641                               | 16                               | 43                                    |
|       |                                |                             |                                |                             |                                  |
| Total      | $                29,625             | 100%                             | $                23,109             | 100%                             | 28%                                   |
|       |                                |                             |                                |                             |                                  |

**Interest      Rate Sensitivity and Liquidity**

----

|                              |   |                                  |   |                         |   |
|-----------------------------------|--------|---------------------------------------|--------|------------------------------|--------|
|                              |   | **Basis                Point Change** |   |
|                              |   | **Plus                200**           |   | **Minus                100** |   |
| June                30, 2005:     |   |                                  |   |                         |   |
| Twelve                Months      |   | 0.60                                  | %      | (7.40                        | )%     |
| Twenty                Four Months |   | 12.58                                 | %      | (7.58                        | )%     |
|                              |   |                                  |   |                         |   |
| June                30, 2004:     |   |                                  |   |                         |   |
| Twelve                Months      |   | 4.06                                  | %      | 1.45                         | %      |
| Twenty                Four Months |   | 11.38                                 | %      | (0.31                        | )%     |
|                              |   |                                  |   |                         |   |

----

|                                  |                            |                         |
|---------------------------------------|---------------------------------|------------------------------|
|                                  | **Market                Value** |                         |
|                                  | **Of                Equity**    | **Per                Share** |
|                                  |                            |                         |
| Plus                200 basis points  | $7,085                          | $43.15                       |
|                                  |                            |                         |
| Current                Rate           | $6,486                          | $39.50                       |
|                                  |                            |                         |
| Minus                100 basis points | $5,242                          | $31.93                       |

**Short-Term      Borrowings**

**Interest      Earning Assets**

----

**Loans**

|                                              |   | **June                30,**   |   |   | **December                31,** |   |
|---------------------------------------------------|--------|-------------------------------|--------|--------|---------------------------------|--------|
|                                              |   | **2005**                      |   |   | **2004**                        |   |
|                                              |   | (in                thousands) |   |
| Commercial:                                       |   |                          |   |   |                            |   |
| Term                                              | $      | 1,505,965                     |   | $      | 1,283,476                       |   |
| Line                of credit                     |   | 1,343,279                     |   |   | 1,168,542                       |   |
| Demand                                            |   | 24,000                        |   |   |                            |   |
|                                              |   | 2,873,244                     |   |   | 2,452,018                       |   |
|                                              |   |                          |   |   |                            |   |
| Owner-occupied                                    |   | 2,229,453                     |   |   | 1,998,203                       |   |
|                                              |   | 5,102,697                     |   |   | 4,450,221                       |   |
|                                              |   |                          |   |   |                            |   |
| Consumer:                                         |   |                          |   |   |                            |   |
| Mortgages                (1-4 family residential) |   | 1,443,602                     |   |   | 1,340,009                       |   |
| Installment                                       |   | 167,663                       |   |   | 132,646                         |   |
| Home                equity                        |   | 2,024,130                     |   |   | 1,799,841                       |   |
| Credit                lines                       |   | 78,370                        |   |   | 69,079                          |   |
|                                              |   | 3,713,765                     |   |   | 3,341,575                       |   |
| Commercial                real estate:            |   |                          |   |   |                            |   |
| Investor                developer                 |   | 1,626,886                     |   |   | 1,455,891                       |   |
| Construction                                      |   | 245,369                       |   |   | 206,924                         |   |
|                                              |   | 1,872,255                     |   |   | 1,662,815                       |   |
| Total                loans                        | $      | 10,688,717                    |   | $      | 9,454,611                       |   |

**Investments**

----

|                                          |                         |   |                       |   |                    |
|-----------------------------------------------|------------------------------|--------|----------------------------|--------|-------------------------|
|                                          | **Available**                |   | **Held                to** |   |                    |
| **Product                Description**        | **For                Sale**  |   | **Maturity**               |   | **Total**               |
|                                          | (in                millions) |
| Mortgage-backed                Securities:    |                         |   |                       |   |                    |
| Federal                Agencies Pass Through  |                         |   |                       |   |                    |
| Certificates                (AAA Rated)       | $                1,379       |   | $                2,398     |   | $                3,777  |
|                                          |                         |   |                       |   |                    |
| Collateralized                Mortgage        |                         |   |                       |   |                    |
| Obligations                (AAA Rated)        | 5,725                        |   | 8,294                      |   | 14,019                  |
|                                          |                         |   |                       |   |                    |
| U.S.                Government agencies/Other | 573                          |   | 1,016                      |   | 1,589                   |
|                                          |                         |   |                       |   |                    |
| Total                                         | $                7,677       |   | $                11,708    |   | $                19,385 |
|                                          |                         |   |                       |   |                    |
| Duration                (in years)            | 2.30                         |   | 3.22                       |   | 2.86                    |
| Average                Life (in years)        | 2.68                         |   | 3.95                       |   | 3.45                    |
| Quarterly                Average Yield        | 4.94%                        |   | 4.87%                      |   | 4.91%                   |

|                                                                  |   |                                |
|-----------------------------------------------------------------------|--------|-------------------------------------|
|                                                                  |   | **At                June 30, 2005** |
|                                                                  |   |  **Amortized****Cost**         | **Gross****Unrealized****Gains** | **Gross****Unrealized****Losses** |  **Market****Value** |
| U.S.                Government agency and mortgage-backed obligations |   |  $7,630,209                    |  $19,838 |  $(20,491) |  $7,629,556 |
| Obligations                of state and political subdivisions        |   | 9,148                               | 123 | (5) | 9,266 |
| Equity                securities                                      |   | 9,679                               | 13,693 |   | 23,372 |
| Other                                                                 |   | 14,438                              | 205 |   | 14,643 |
| Securities                available for sale                          |   | $7,663,474                          | $33,859 | $(20,496) | $7,676,837 |
|                                                                  |   |                                |   |   |   |
| U.S.                Government agency and mortgage-backed obligations |   |  $11,254,998                   |  $41,255 |  $(60,000) |  $11,236,253 |
| Obligations                of state and political subdivisions        |   | 346,391                             | 3,261 | (150) | 349,502 |
| Other                                                                 |   | 106,877                             |   |   | 106,877 |
| Securities                held to maturity                            |   | $11,708,266                         | $44,516 | $(60,150) | $11,692,632 |

----

|                                                                  |   |                                    |
|-----------------------------------------------------------------------|--------|-----------------------------------------|
|                                                                  |   | **At                December 31, 2004** |
|                                                                  |   |  **Amortized****Cost**             | **Gross****Unrealized****Gains** | **Gross****Unrealized****Losses** |  **Market****Value** |
| U.S.                Government agency and mortgage-backed obligations |   |  $                7,884,113        |  $40,141 |  $(21,438) |  $                7,902,816 |
| Obligations                of state and political subdivisions        |   | 87,605                                  | 305 |   | 87,910 |
| Equity                securities                                      |   | 10,129                                  | 13,174 |   | 23,303 |
| Other                                                                 |   | 29,312                                  | 809 |   | 30,121 |
| Securities                available for sale                          |   | $                8,011,159              | $54,429 | $(21,438) | $                8,044,150 |
|                                                                  |   |                                    |   |   |   |
| U.S.                Government agency and mortgage-backed obligations |   |  $                9,967,041        |  $43,982 |  $(81,028) |  $                9,929,995 |
| Obligations                of state and political subdivisions        |   | 398,963                                 | 3,867 | (28) | 402,802 |
| Other                                                                 |   | 97,654                                  |   |   | 97,654 |
| Securities                held to maturity                            |   | $10,463,658                             | $47,849 | $(81,056) | $10,430,451 |

**Net      Income**

----

**Net      Interest Income**

|                                        | **Net                Interest Income** |
|---------------------------------------------|----------------------------------------|
|                                        | **Volume**                             |   | **Rate** |   | **Total** |   | **%** |
| **2005                vs. 2004**            | **Increase**                           |   | **Change** |   | **Increase** |   | **Increase** |
|                                        |                                   |   |   |   |   |   |   |
| **Quarter                Ended June 30**    | $                67,784                |   | $(23,902) |   | $43,882 |   | 18% |
|                                        |                                   |   |   |   |   |   |   |
| **Six                Months Ended June 30** | $137,965                               |   | $(45,492) |   | $92,473 |   | 19% |

----

**Average      Balances and Net Interest Income**

|                                                 |                       |   |                      |   |                     |   |
|------------------------------------------------------|----------------------------|--------|---------------------------|--------|--------------------------|--------|
|                                                 | June                2005   |   | March                2005 |   | June                2004 |   |
|                                                 | Average                    |   |                      |   | Average                  |   | Average |   |   |   | Average |   | Average |   |   |   | Average |   |
| *(dollars                in thousands)*              | Balance                    |   | Interest                  |   | Rate                     |   | Balance |   | Interest |   | Rate |   | Balance |   | Interest |   | Rate |   |
| **Earning                Assets**                    |                       |   |                      |   |                     |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Investment                securities                 |                       |   |                      |   |                     |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Taxable                                              | $18,821,647                |   | $                231,275  |   | 4.93                     | %      | $18,192,721 |   | $221,886 |   | 4.95 | % | $14,747,643 |   | $173,678 |   | 4.74 | % |
| Tax-exempt                                           | 374,448                    |   | 3,257                     |   | 3.49                     |   | 405,771 |   | 3,313 |   | 3.31 |   | 290,200 |   | 4,465 |   | 6.19 |   |
| Trading                                              | 178,037                    |   | 2,427                     |   | 5.47                     |   | 111,732 |   | 1,395 |   | 5.06 |   | 174,578 |   | 2,075 |   | 4.78 |   |
| Total                investment securities           | 19,374,132                 |   | 236,959                   |   | 4.91                     |   | 18,710,224 |   | 226,594 |   | 4.91 |   | 15,212,421 |   | 180,218 |   | 4.76 |   |
| Federal                funds sold                    | 117,491                    |   | 889                       |   | 3.03                     |   | 50,311 |   | 316 |   | 2.55 |   | 62,357 |   | 154 |   | 0.99 |   |
| Loans                                                |                       |   |                      |   |                     |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Commercial                mortgages                  | 3,707,963                  |   | 59,684                    |   | 6.46                     |   | 3,527,626 |   | 55,095 |   | 6.33 |   | 3,021,768 |   | 45,333 |   | 6.03 |   |
| Commercial                                           | 2,569,001                  |   | 41,417                    |   | 6.47                     |   | 2,327,438 |   | 35,581 |   | 6.20 |   | 1,961,351 |   | 25,477 |   | 5.22 |   |
| Consumer                                             | 3,720,529                  |   | 55,819                    |   | 6.02                     |   | 3,423,574 |   | 49,974 |   | 5.92 |   | 2,767,826 |   | 39,079 |   | 5.68 |   |
| Tax-exempt                                           | 426,032                    |   | 7,568                     |   | 7.12                     |   | 391,510 |   | 7,028 |   | 7.28 |   | 335,505 |   | 6,243 |   | 7.48 |   |
| Total                loans                           | 10,423,525                 |   | 164,488                   |   | 6.33                     |   | 9,670,148 |   | 147,678 |   | 6.19 |   | 8,086,450 |   | 116,132 |   | 5.78 |   |
| Total                earning assets                  | $29,915,148                |   | $                402,336  |   | 5.39                     | %      | $28,430,683 |   | $374,588 |   | 5.35 | % | $23,361,228 |   | $296,504 |   | 5.10 | % |
|                                                 |                       |   |                      |   |                     |   |   |   |   |   |   |   |   |   |   |   |   |   |
| **Sources                of Funds**                  |                       |   |                      |   |                     |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest-bearing                liabilities          |                       |   |                      |   |                     |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Savings                                              | $                7,082,969 |   | $                23,258   |   | 1.32                     | %      | $                6,558,587 |   | $                19,080 |   | 1.18 | % | $                5,276,657 |   | $                10,216 |   | 0.78 | % |
| Interest                bearing demand               | 12,094,680                 |   | 53,755                    |   | 1.78                     |   | 11,924,947 |   | 46,671 |   | 1.59 |   | 9,643,771 |   | 18,729 |   | 0.78 |   |
| Time                deposits                         | 2,668,791                  |   | 16,085                    |   | 2.42                     |   | 2,566,074 |   | 13,740 |   | 2.17 |   | 2,507,526 |   | 11,378 |   | 1.82 |   |
| Public                funds                          | 828,305                    |   | 6,196                     |   | 3.00                     |   | 781,282 |   | 4,658 |   | 2.42 |   | 856,683 |   | 2,886 |   | 1.35 |   |
| Total                deposits                        | 22,674,745                 |   | 99,294                    |   | 1.76                     |   | 21,830,890 |   | 84,149 |   | 1.56 |   | 18,284,637 |   | 43,209 |   | 0.95 |   |
|                                                 |                       |   |                      |   |                     |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Other                borrowed money                  | 845,462                    |   | 6,917                     |   | 3.28                     |   | 703,223 |   | 4,410 |   | 2.54 |   | 523,931 |   | 1,052 |   | 0.81 |   |
| Long-term                debt                        | 200,000                    |   | 3,020                     |   | 6.06                     |   | 200,000 |   | 3,020 |   | 6.12 |   | 200,000 |   | 3,020 |   | 6.07 |   |
| Total                deposits and interest-bearing   |                       |   |                      |   |                     |   |   |   |   |   |   |   |   |   |   |   |   |   |
| liabilities                                          | 23,720,207                 |   | 109,231                   |   | 1.85                     |   | 22,734,113 |   | 91,579 |   | 1.63 |   | 19,008,568 |   | 47,281 |   | 1.00 |   |
| Noninterest-bearing                funds (net)       | 6,194,941                  |   |                      |   |                     |   | 5,696,570 |   |   |   |   |   | 4,352,660 |   |   |   |   |   |
| Total                sources to fund earning assets  | $29,915,148                |   | 109,231                   |   | 1.46                     |   | $28,430,683 |   | 91,579 |   | 1.31 |   | $23,361,228 |   | 47,281 |   | 0.81 |   |
|                                                 |                       |   |                      |   |                     |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net                interest income and               |                       |   |                      |   |                     |   |   |   |   |   |   |   |   |   |   |   |   |   |
| margin                tax-equivalent basis           |                       |   | $                293,105  |   | 3.93                     | %      |   |   | $283,009 |   | 4.04 | % |   |   | $249,223 |   | 4.29 | % |
|                                                 |                       |   |                      |   |                     |   |   |   |   |   |   |   |   |   |   |   |   |   |
| **Other                Balances**                    |                       |   |                      |   |                     |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Cash                and due from banks               | $                1,241,372 |   |                      |   |                     |   | $                1,180,375 |   |   |   |   |   | $                1,163,942 |   |   |   |   |   |
| Other                assets                          | 1,749,133                  |   |                      |   |                     |   | 1,625,412 |   |   |   |   |   | 1,419,098 |   |   |   |   |   |
| Total                assets                          | 32,763,128                 |   |                      |   |                     |   | 31,096,724 |   |   |   |   |   | 25,822,157 |   |   |   |   |   |
| Total                deposits                        | 29,661,511                 |   |                      |   |                     |   | 28,220,513 |   |   |   |   |   | 23,541,453 |   |   |   |   |   |
| Demand                deposits (noninterest-bearing) | 6,986,766                  |   |                      |   |                     |   | 6,389,623 |   |   |   |   |   | 5,256,816 |   |   |   |   |   |
| Other                liabilities                     | 259,873                    |   |                      |   |                     |   | 256,677 |   |   |   |   |   | 222,779 |   |   |   |   |   |
| Stockholders’                equity            | 1,796,282                  |   |                      |   |                     |   | 1,716,311 |   |   |   |   |   | 1,333,994 |   |   |   |   |   |

| Notes  | - | Weighted                average yields on tax-exempt obligations have been computed on a                tax-equivalent basis assuming a federal tax rate of                35%. |
|--------|---|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   | - | Non-accrual                loans have been included in the average loan                balance.                                                                                 |

----

**Noninterest      Income**

|                                   |                                                             |   |                                                           |
|----------------------------------------|------------------------------------------------------------------|--------|----------------------------------------------------------------|
|                                   | **Three                Months Ended****June                30,** |   | **Six                Months Ended****June                30,** |
|                                   | **2005**                                                         |   | **2004**                                                       |   | **2005** |   | **2004** |
| Other                operating income: |                                                             |   |                                                           |   |   |   |   |
| Insurance                              | $18,750                                                          |   | $18,570                                                        |   | $38,539 |   | $36,906 |
| Capital                Markets         | 7,248                                                            |   | 6,622                                                          |   | 13,687 |   | 16,349 |
| Loan                Brokerage Fees     | 2,949                                                            |   | 3,725                                                          |   | 5,708 |   | 6,778 |
| Other                                  | 13,205                                                           |   | 10,006                                                         |   | 26,835 |   | 19,217 |
| Total                other             | $42,152                                                          |   | $38,923                                                        |   | $84,769 |   | $79,250 |

**Noninterest      Expense**

|                                                   |                                                             |   |                                                           |
|--------------------------------------------------------|------------------------------------------------------------------|--------|----------------------------------------------------------------|
|                                                   | **Three                Months Ended****June                30,** |   | **Six                Months Ended****June                30,** |
|                                                   | **2005**                                                         |   | **2004**                                                       |   | **2005** |   | **2004** |
| Other                noninterest expense:              |                                                             |   |                                                           |   |   |   |   |
| Business                development costs              | $13,655                                                          |   | $                8,245                                         |   | $                20,770 |   | $14,240 |
| Bank-card                related service charges       | 12,309                                                           |   | 8,422                                                          |   | 23,224 |   | 15,945 |
| Professional                services/Insurance         | 9,074                                                            |   | 9,774                                                          |   | 18,860 |   | 17,131 |
| Provision                for non-credit-related losses | 6,643                                                            |   | 4,493                                                          |   | 14,315 |   | 9,896 |
| Other                                                  | 20,228                                                           |   | 16,063                                                         |   | 38,448 |   | 32,790 |
| Total                other                             | $61,909                                                          |   | $46,997                                                        |   | $115,617 |   | $90,002 |

----

**Loan      and Asset Quality**

----

|                                                        |   | **June                30,****2005** |    | **March                31,****2005** |   | **December                31,****2004** |   | **September                30,****2004** |    | **June                30,****2004** |   |
|-------------------------------------------------------------|--------|-------------------------------------|---------|--------------------------------------|--------|-----------------------------------------|--------|------------------------------------------|---------|-------------------------------------|--------|
| Non-accrual                loans:                           |   |                                |    |                                 |   |                                    |   |                                     |    |                                |   |
| Commercial                                                  |   |                                | $20,467 |                                 |   | $18,376                                 |   |                                     | $17,874 |                                |   | $22,647 |   |   | $17,382 |   |
| Consumer                                                    |   |                                | 8,641   |                                 |   | 8,723                                   |   |                                     | 10,138  |                                |   | 9,784 |   |   | 11,675 |   |
| Real                estate:                                 |   |                                |    |                                 |   |                                    |   |                                     |    |                                |   |   |   |   |   |   |
| Construction                                                |   |                                | 178     |                                 |   | 178                                     |   |                                     |    |                                |   |   |   |   |   |   |
| Mortgage                                                    |   |                                | 3,086   |                                 |   | 1,290                                   |   |                                     | 1,317   |                                |   | 1,251 |   |   | 675 |   |
| Total                non-accrual loans                      |   |                                | 32,372  |                                 |   | 28,567                                  |   |                                     | 29,329  |                                |   | 33,682 |   |   | 29,732 |   |
|                                                        |   |                                |    |                                 |   |                                    |   |                                     |    |                                |   |   |   |   |   |   |
| Restructured                loans:                          |   |                                |    |                                 |   |                                    |   |                                     |    |                                |   |   |   |   |   |   |
| Commercial                                                  |   |                                | 3,326   |                                 |   | 3,422                                   |   |                                     | 3,518   |                                |   | 3,614 |   |   | 1 |   |
| Total                restructured loans                     |   |                                | 3,326   |                                 |   | 3,422                                   |   |                                     | 3,518   |                                |   | 3,614 |   |   | 1 |   |
|                                                        |   |                                |    |                                 |   |                                    |   |                                     |    |                                |   |   |   |   |   |   |
| Total                non-performing loans                   |   |                                | 35,698  |                                 |   | 31,989                                  |   |                                     | 32,847  |                                |   | 37,296 |   |   | 29,733 |   |
|                                                        |   |                                |    |                                 |   |                                    |   |                                     |    |                                |   |   |   |   |   |   |
| Other                real estate                            |   |                                | 349     |                                 |   | 777                                     |   |                                     | 626     |                                |   | 972 |   |   | 653 |   |
|                                                        |   |                                |    |                                 |   |                                    |   |                                     |    |                                |   |   |   |   |   |   |
| Total                non-performing assets                  |   |                                | 36,047  |                                 |   | 32,766                                  |   |                                     | 33,473  |                                |   | 38,268 |   |   | 30,386 |   |
|                                                        |   |                                |    |                                 |   |                                    |   |                                     |    |                                |   |   |   |   |   |   |
| Loans                past due 90 days or more               |   |                                |    |                                 |   |                                    |   |                                     |    |                                |   |   |   |   |   |   |
| and                still accruing                           |   |                                | 165     |                                 |   | 233                                     |   |                                     | 602     |                                |   | 614 |   |   | 318 |   |
|                                                        |   |                                |    |                                 |   |                                    |   |                                     |    |                                |   |   |   |   |   |   |
| Total                non-performing assets and              |   |                                |    |                                 |   |                                    |   |                                     |    |                                |   |   |   |   |   |   |
| loans                past due 90 days or more               |   |                                | $36,212 |                                 |   | $32,999                                 |   |                                     | $34,075 |                                |   | $38,882 |   |   | $30,704 |   |
|                                                        |   |                                |    |                                 |   |                                    |   |                                     |    |                                |   |   |   |   |   |   |
| Total                non-performing loans as a              |   |                                |    |                                 |   |                                    |   |                                     |    |                                |   |   |   |   |   |   |
| percentage                of total period-end loans         |   |                                | 0.33    | %                                    |   | 0.32                                    | %      |                                     | 0.35    | %                                   |   | 0.42 | % |   | 0.36 | % |
|                                                        |   |                                |    |                                 |   |                                    |   |                                     |    |                                |   |   |   |   |   |   |
| Total                non-performing assets as a             |   |                                |    |                                 |   |                                    |   |                                     |    |                                |   |   |   |   |   |   |
| percentage                of total period-end assets        |   |                                | 0.11    | %                                    |   | 0.10                                    | %      |                                     | 0.11    | %                                   |   | 0.13 | % |   | 0.11 | % |
|                                                        |   |                                |    |                                 |   |                                    |   |                                     |    |                                |   |   |   |   |   |   |
| Total                non-performing assets and loans        |   |                                |    |                                 |   |                                    |   |                                     |    |                                |   |   |   |   |   |   |
| past                due 90 days or more as a                |   |                                |    |                                 |   |                                    |   |                                     |    |                                |   |   |   |   |   |   |
| percentage                of total period-end assets        |   |                                | 0.11    | %                                    |   | 0.10                                    | %      |                                     | 0.11    | %                                   |   | 0.14 | % |   | 0.11 | % |
|                                                        |   |                                |    |                                 |   |                                    |   |                                     |    |                                |   |   |   |   |   |   |
| Allowance                for loan losses as a percentage    |   |                                |    |                                 |   |                                    |   |                                     |    |                                |   |   |   |   |   |   |
| of                total non-performing loans                |   |                                | 396     | %                                    |   | 435                                     | %      |                                     | 413     | %                                   |   | 353 | % |   | 419 | % |
|                                                        |   |                                |    |                                 |   |                                    |   |                                     |    |                                |   |   |   |   |   |   |
| Allowance                for loan losses as a percentage    |   |                                |    |                                 |   |                                    |   |                                     |    |                                |   |   |   |   |   |   |
| of                total period-end loans                    |   |                                | 1.32    | %                                    |   | 1.40                                    | %      |                                     | 1.43    | %                                   |   | 1.48 | % |   | 1.50 | % |
|                                                        |   |                                |    |                                 |   |                                    |   |                                     |    |                                |   |   |   |   |   |   |
| Total                non-performing assets and loans        |   |                                |    |                                 |   |                                    |   |                                     |    |                                |   |   |   |   |   |   |
| past                due 90 days or more as a                |   |                                |    |                                 |   |                                    |   |                                     |    |                                |   |   |   |   |   |   |
| percentage                of stockholders’ equity and |   |                                |    |                                 |   |                                    |   |                                     |    |                                |   |   |   |   |   |   |
| allowance                for loan losses                    |   |                                | 2       | %                                    |   | 2                                       | %      |                                     | 2       | %                                   |   | 2 | % |   | 2 | % |

----

|                                                       | **Three                Months Ended** |   | **Six                Months Ended** |   | **Year                Ended**   |   |
|------------------------------------------------------------|---------------------------------------|--------|-------------------------------------|--------|---------------------------------|--------|
|                                                       | **June                30,**           |   | **June                30,**         |   | **December                31,** |   |
|                                                       | **2005**                              |   | **2004**                            |   | **2005**                        |   | **2004** |   | **2004** |   |
| Balance                at beginning of period              | $139,289                              |   | $117,329                            |   | $135,620                        |   | $112,057 |   | $112,057 |   |
| Provisions                charged to operating expenses    | 4,500                                 |   | 10,748                              |   | 10,750                          |   | 20,248 |   | 39,238 |   |
|                                                       | 143,789                               |   | 128,077                             |   | 146,370                         |   | 132,305 |   | 151,295 |   |
|                                                       |                                  |   |                                |   |                            |   |   |   |   |   |
| Recoveries                on loans previously charged-off: |                                  |   |                                |   |                            |   |   |   |   |   |
| Commercial                                                 | 339                                   |   | 104                                 |   | 990                             |   | 260 |   | 1,000 |   |
| Consumer                                                   | 254                                   |   | 101                                 |   | 1,087                           |   | 371 |   | 1,123 |   |
| Commercial                real estate                      |                                  |   | 1                                   |   | 50                              |   | 48 |   | 52 |   |
| Total                recoveries                            | 593                                   |   | 206                                 |   | 2,127                           |   | 679 |   | 2,175 |   |
|                                                       |                                  |   |                                |   |                            |   |   |   |   |   |
| Loans                charged-off:                          |                                  |   |                                |   |                            |   |   |   |   |   |
| Commercial                                                 | (1,213                                | )      | (2,675                              | )      | (3,815                          | )      | (4,998 | ) | (9,416 | ) |
| Consumer                                                   | (915                                  | )      | (916                                | )      | (2,402                          | )      | (1,676 | ) | (6,733 | ) |
| Commercial                real estate                      | (929                                  | )      | (4                                  | )      | (955                            | )      | (1,622 | ) | (1,701 | ) |
| Total                charge-offs                           | (3,057                                | )      | (3,595                              | )      | (7,172                          | )      | (8,296 | ) | (17,850 | ) |
| Net                charge-offs                             | (2,464                                | )      | (3,389                              | )      | (5,045                          | )      | (7,617 | ) | (15,675 | ) |
|                                                       |                                  |   |                                |   |                            |   |   |   |   |   |
| Balance                at end of period                    | $141,325                              |   | $124,688                            |   | $141,325                        |   | $124,688 |   | $135,620 |   |
|                                                       |                                  |   |                                |   |                            |   |   |   |   |   |
| Net                charge-offs as a percentage of          |                                  |   |                                |   |                            |   |   |   |   |   |
| average                loans outstanding                   | 0.09                                  | %      | 0.17                                | %      | 0.10                            | %      | 0.19 | % | 0.19 | % |
|                                                       |                                  |   |                                |   |                            |   |   |   |   |   |
| Net                Reserve Additions                       | $2,036                                |   | $7,359                              |   | $5,705                          |   | $12,631 |   | $23,563 |   |

----

**Forward-Looking      Statements**

**Item      3.**
**Quantitative      and Qualitative Disclosures About Market Risk**

----

**Item      4. **
**Controls      and Procedures**

**Quarterly      evaluation of the Company’s Disclosure Controls and Internal      Controls**

**Limitations      on the Effectiveness of Controls**

**Conclusions.**

**PART      II.** **OTHER      INFORMATION**

**Item      1. **
**Legal      Proceedings**

----

**Item      4. **
**Submission      of Matters to a Vote of Security Holders**

|                                    |   |    |        | **(Withhold                Authority)**  |
|-----------------------------------------|--------|---------|-------------|-----------------------------------------------|
| **Name                of Nominee**      |   | **For** |        | **Against**                              |
|                                    |   |    |        |                                          |   |
| Vernon                W. Hill, II       |   |    | 138,881,216 |                                          |   | 4,029,392 |   |
| Jack                R Bershad           |   |    | 138,823,961 |                                          |   | 4,086,647 |   |
| Joseph                E. Buckelew       |   |    | 138,462,794 |                                          |   | 4,447,814 |   |
| Donald                T. DiFrancesco    |   |    | 122,761,226 |                                          |   | 20,149,382 |   |
| Morton                N. Kerr           |   |    | 138,843,430 |                                          |   | 4,067,178 |   |
| Steven                M. Lewis          |   |    | 137,219,259 |                                          |   | 5,691,349 |   |
| John                K. Lloyd            |   |    | 139,597,930 |                                          |   | 3,312,678 |   |
| George                E. Norcross, III  |   |    | 137,743,553 |                                          |   | 5,167,055 |   |
| Daniel                J. Ragone         |   |    | 137,211,525 |                                          |   | 5,699,083 |   |
| William                A. Schwartz, Jr. |   |    | 139,545,268 |                                          |   | 3,365,340 |   |
| Joseph                T. Tarquini, Jr.  |   |    | 138,975,313 |                                          |   | 3,935,295 |   |
| Joseph                S. Vassalluzzo    |   |    | 139,606,594 |                                          |   | 3,304,014 |   |

|        | **Broker**  |        |         |
|-------------|-------------|-------------|--------------|
| **For**     | **Against** | **Abstain** | **Non-Vote** |
|        |        |        |         |
| 142,343,653 | 313,615     | 253,340     | 18,695,717   |

**Item      6.** **Exhibits      **

| Exhibit                31.1 | Certification                of the Company’s Chief Executive Officer pursuant to 18 U.S.C. Section                1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act                of                2002.                             |
|-----------------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                        |                                                                                                                                                                                                                                                           |
| Exhibit                31.2 | Certification                of the Company’s Chief Financial Officer pursuant to 18 U.S.C. Section                1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act                of                2002.                             |
|                        |                                                                                                                                                                                                                                                           |
| Exhibit                32   | Certification                of the Company’s Chief Executive Officer and Chief Financial Officer                pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section                906 of                the Sarbanes-Oxley Act of 2002. |

----

**SIGNATURES**

|                          |   | COMMERCE                BANCORP, INC.                       |
|-------------------------------|--------|-------------------------------------------------------------|
|                          |   | (Registrant)                                                |
|                          |   |                                                        |
|                          |   |                                                        |
|                          |   |                                                        |
|                          |   |                                                        |
|                          |   |                                                        |
|                          |   |                                                        |
|                          |   |                                                        |
|                          |   |                                                        |
|                          |   |                                                        |
|                          |   |                                                        |
| AUGUST                5, 2005 |   | /s/                DOUGLAS J. PAULS                         |
| (Date)                        |   | DOUGLAS                J. PAULS                             |
|                          |   | SENIOR                VICE PRESIDENT AND                    |
|                          |   | CHIEF                FINANCIAL OFFICER                      |
|                          |   | (PRINCIPAL                FINANCIAL AND ACCOUNTING OFFICER) |

----