DALLAS, Jan. 21, 2014 /PRNewswire/ -- Comerica Incorporated (NYSE: CMA) today issued revised 2013 results based on an unfavorable Montana jury verdict, entered at approximately 7:30 p.m. ET on January 17, 2014. The Montana litigation ("the case") in which Comerica Bank ("the Bank") was a third-party defendant, was tried before the Montana Second District Judicial Court for Silver Bow County in Butte, Montana. The claims underlying the lawsuit against the Bank grew out of an initial $9 million revolving line of credit loan extended by the Bank to Masters Group International, Inc. ("Masters"), a then Michigan-based office supply company, in 2006, that was subsequently increased to $10.5 million and later paid in full through collection actions taken by the Bank following a default by Masters.
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Following the jury's decision on the case, Comerica increased its reserve for litigation and decreased incentive compensation expense based on the revised results, effective as of December 31, 2013, which resulted in a decrease in net income of $28 million, or 15 cents per share, for the fourth quarter 2013.
Comerica reiterates its previously stated outlook for 2014, excluding the impact of this event.
"As we consider possible courses of action, including appealing the decision to the Montana Supreme Court, the sole appellate court for the state of Montana, we recorded a charge in the fourth quarter 2013 in accordance with applicable accounting principles," said Ralph W. Babb Jr., chairman and chief executive officer. "We believe we had meritorious defenses for this litigation and anticipated a favorable outcome."
Net income decreased by $28 million, or 15 cents per share, to $117 million, or 62 cents per share for the fourth quarter 2013, compared to previously reported net income of $145 million, or 77 cents per share. For the year ended December 31, 2013, net income decreased to $541 million, or $2.85 per share, as compared to previously reported net income of $569 million, or $3.00 per share. As revised, full-year 2013 net income increased $20 million, or 4 percent, compared to 2012, and earnings per diluted share increased 18 cents, or 7 percent. At December 31, 2013, the revised estimated Tier 1 common capital ratio was 10.56 percent, as compared to the previously reported ratio of 10.60 percent. The estimated Basel III Tier 1 common capital ratio remained at 10.3 percent.
The following table summarizes the impact of the revisions on the previously reported financial results.
December 31, 2013
-----------------
Quarter Ended Year Ended
------------- ----------
(dollar As As As
amounts in Revised Reported Revised
millions,
except per
share
data) As Reported
----------- ----------- ------- -------- -------
Noninterest
expenses $429 $473 $1,678 $1,722
Salaries 203 197 769 763
Litigation-
related
expenses - 52 - 52
Other
noninterest
expenses 46 44 178 176
Income
before
income
taxes 196 152 774 730
Provision
for income
taxes 51 35 205 189
Net income 145 117 569 541
Net income
attributable
to common
shares 143 115 561 533
Diluted
income per
common
share 0.77 0.62 3.00 2.85
Total
shareholders'
equity at
period end 7,181 7,153
Estimated
Tier 1
common
capital
ratio (a) 10.60% 10.56%
Estimated
Basel III
Tier 1
common
capital
ratio (a) 10.3% 10.3%
Tangible
common
equity
ratio (a) 10.11% 10.07%
---------- ----- -----
See
Reconciliation
of Non-
GAAP
Financial
a) Measures.
The impact of the change in legal reserves primarily affects the Business Bank and the Michigan market. The revised financial results, including segment results, will be reflected in Comerica's Annual Report on Form 10-K. All other revised financial results are included in the financial information that follows.
Comerica Bank is a subsidiary of Comerica Incorporated, a financial services company headquartered in Dallas, Texas, and strategically aligned by three major business segments: The Business Bank, The Retail Bank and Wealth Management. Comerica focuses on relationships and helping people and businesses be successful. In addition to Texas, Comerica Bank locations can be found in Arizona, California, Florida and Michigan, with select businesses operating in several other states, as well as in Canada and Mexico.
This press release contains both financial measures based on accounting principles generally accepted in the United States (GAAP) and non-GAAP based financial measures, which are used where management believes it to be helpful in understanding Comerica's results of operations or financial position. Where non-GAAP financial measures are used, the comparable GAAP financial measure, as well as a reconciliation to the comparable GAAP financial measure, can be found in this press release. These disclosures should not be viewed as a substitute for operating results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies.
Forward-looking Statements
Any statements in this news release that are not historical facts are forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Words such as "anticipates," "believes," "contemplates," "feels," "expects," "estimates," "seeks," "strives," "plans," "intends," "outlook," "forecast," "position," "target," "mission," "assume," "achievable," "potential," "strategy," "goal," "aspiration," "opportunity," "initiative," "outcome," "continue," "remain," "maintain," "on course," "trend," "objective," "looks forward" and variations of such words and similar expressions, or future or conditional verbs such as "will," "would," "should," "could," "might," "can," "may" or similar expressions, as they relate to Comerica or its management, are intended to identify forward-looking statements. These forward-looking statements are predicated on the beliefs and assumptions of Comerica's management based on information known to Comerica's management as of the date of this news release and do not purport to speak as of any other date. Forward-looking statements may include descriptions of plans and objectives of Comerica's management for future or past operations, products or services, and forecasts of Comerica's revenue, earnings or other measures of economic performance, including statements of profitability, business segments and subsidiaries, estimates of credit trends and global stability. Such statements reflect the view of Comerica's management as of this date with respect to future events and are subject to risks and uncertainties. Should one or more of these risks materialize or should underlying beliefs or assumptions prove incorrect, Comerica's actual results could differ materially from those discussed. Factors that could cause or contribute to such differences are changes in general economic, political or industry conditions; changes in monetary and fiscal policies, including the interest rate policies of the Federal Reserve Board; volatility and disruptions in global capital and credit markets; changes in Comerica's credit rating; the interdependence of financial service companies; changes in regulation or oversight; unfavorable developments concerning credit quality; any future acquisitions or divestitures; the effects of more stringent capital or liquidity requirements; declines or other changes in the businesses or industries of Comerica's customers; the implementation of Comerica's strategies and business models; Comerica's ability to utilize technology to efficiently and effectively develop, market and deliver new products and services; operational difficulties, failure of technology infrastructure or information security incidents; changes in the financial markets, including fluctuations in interest rates and their impact on deposit pricing; competitive product and pricing pressures among financial institutions within Comerica's markets; changes in customer behavior; management's ability to maintain and expand customer relationships; management's ability to retain key officers and employees; the impact of legal and regulatory proceedings or determinations; the effectiveness of methods of reducing risk exposures; the effects of terrorist activities and other hostilities; the effects of catastrophic events including, but not limited to, hurricanes, tornadoes, earthquakes, fires, droughts and floods; changes in accounting standards and the critical nature of Comerica's accounting policies. Comerica cautions that the foregoing list of factors is not exclusive. For discussion of factors that may cause actual results to differ from expectations, please refer to our filings with the Securities and Exchange Commission. In particular, please refer to "Item 1A. Risk Factors" beginning on page 13 of Comerica's Annual Report on Form 10-K for the year ended December 31, 2012 and on page 68 of the Corporation's Quarterly Report on Form 10-Q for the quarter ended June 30, 2013. Forward-looking statements speak only as of the date they are made. Comerica does not undertake to update forward-looking statements to reflect facts, circumstances, assumptions or events that occur after the date the forward-looking statements are made. For any forward-looking statements made in this news release or in any documents, Comerica claims the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995.
CONSOLIDATED FINANCIAL HIGHLIGHTS (unaudited)
Comerica Incorporated and Subsidiaries
Three Months Ended Years Ended
------------------ -----------
December 31, September 30, December 31, December 31,
(in millions,
except per
share data) 2013 2013 2012 2013 2012
------------- ---- ---- ---- ---- ----
PER COMMON SHARE AND COMMON
STOCK DATA
Diluted net
income $0.62 $0.78 $0.68 $2.85 $2.67
Cash dividends
declared 0.17 0.17 0.15 0.68 0.55
Common
shareholders'
equity (at
period end) 39.23 37.94 36.87
Tangible
common equity
(at period
end) (a) 35.65 34.38 33.38
Average
diluted
shares (in
thousands) 186,166 187,104 187,954 186,927 192,473
----------- ------- ------- ------- ------- -------
KEY RATIOS
Return on
average
common
shareholders'
equity 6.66% 8.50% 7.36% 7.76% 7.43%
Return on
average
assets 0.72 0.92 0.81 0.85 0.83
Tier 1 common
capital ratio
(a) (b) 10.56 10.72 10.14
Tier 1 risk-
based capital
ratio (b) 10.56 10.72 10.14
Total risk-
based capital
ratio (b) 13.00 13.42 13.15
Leverage ratio
(b) 10.77 10.88 10.57
Tangible
common equity
ratio (a) 10.07 9.87 9.76
-------------- ----- ---- ----
AVERAGE BALANCES
Commercial
loans $27,683 $27,759 $27,462 $27,971 $26,224
Real estate construction
loans:
Commercial
Real Estate
business line
(c) 1,363 1,263 1,033 1,241 1,031
Other business
lines (d) 289 259 266 245 359
--- --- --- --- ---
Total real
estate
construction
loans 1,652 1,522 1,299 1,486 1,390
Commercial mortgage loans:
Commercial
Real Estate
business line
(c) 1,608 1,714 1,939 1,738 2,259
Other business
lines (d) 7,106 7,229 7,580 7,322 7,583
----- ----- ----- ----- -----
Total
commercial
mortgage
loans 8,714 8,943 9,519 9,060 9,842
Lease
financing 838 839 839 847 864
International
loans 1,303 1,252 1,314 1,275 1,272
Residential
mortgage
loans 1,679 1,642 1,525 1,620 1,505
Consumer loans 2,185 2,137 2,161 2,153 2,209
----- ----- ----- ----- -----
Total loans 44,054 44,094 44,119 44,412 43,306
Earning assets 59,924 58,892 59,276 59,091 57,483
Total assets 64,605 63,660 64,257 63,936 62,572
Noninterest-
bearing
deposits 23,532 22,379 22,758 22,379 21,004
Interest-
bearing
deposits 29,237 29,486 28,524 29,332 28,529
------ ------ ------ ------ ------
Total deposits 52,769 51,865 51,282 51,711 49,533
Common
shareholders'
equity 7,010 6,923 7,062 6,968 7,012
-------------- ----- ----- ----- ----- -----
NET INTEREST INCOME
Net interest
income (fully
taxable
equivalent
basis) $431 $413 $425 $1,675 $1,731
Fully taxable
equivalent
adjustment 1 1 1 3 3
Net interest
margin (fully
taxable
equivalent
basis) 2.86% 2.79% 2.87% 2.84% 3.03%
-------------- ---- ---- ---- ---- ----
CREDIT QUALITY
Nonaccrual
loans $350 $437 $519
Reduced-rate
loans 24 22 22
--- --- ---
Total
nonperforming
loans (e) 374 459 541
Foreclosed
property 9 19 54
--- --- ---
Total
nonperforming
assets (e) 383 478 595
Loans past due
90 days or
more and
still
accruing 16 25 23
Gross loan
charge-offs 41 39 60 $153 $245
Loan
recoveries 28 20 23 80 75
--- --- --- --- ---
Net loan
charge-offs 13 19 37 73 170
Allowance for
loan losses 598 604 629
Allowance for
credit losses
on lending-
related
commitments 36 34 32
--- --- ---
Total
allowance for
credit losses 634 638 661
Allowance for
loan losses
as a
percentage of
total loans 1.32% 1.37% 1.37%
Net loan
charge-offs
as a
percentage of
average total
loans (f) 0.12 0.18 0.34 0.16% 0.39%
Nonperforming
assets as a
percentage of
total loans
and
foreclosed
property (e) 0.84 1.08 1.29
Allowance for
loan losses
as a
percentage of
total
nonperforming
loans 160 131 116
-------------- --- --- ---
See
Reconciliation
of Non-
GAAP
Financial
(a) Measures.
(b) December 31, 2013 ratios
are estimated.
(c) Primarily loans to real
estate developers.
(d) Primarily loans
secured by
owner-occupied
real estate.
(e) Excludes loans acquired
with credit-
impairment.
Lending-related
commitment charge-
offs were
insignificant in all
(f) periods presented.
CONSOLIDATED BALANCE SHEETS
Comerica Incorporated
and Subsidiaries
December 31, September 30, December 31,
(in millions, except
share data) 2013 2013 2012
-------------------- ---- ---- ----
(unaudited) (unaudited)
ASSETS
Cash and due from
banks $1,140 $1,384 $1,395
Federal funds sold - - 100
Interest-bearing
deposits with banks 5,311 5,704 3,039
Other short-term
investments 112 106 125
Investment securities
available-for-sale 9,307 9,488 10,297
Commercial loans 28,815 27,897 29,513
Real estate
construction loans 1,762 1,552 1,240
Commercial mortgage
loans 8,787 8,785 9,472
Lease financing 845 829 859
International loans 1,327 1,286 1,293
Residential mortgage
loans 1,697 1,650 1,527
Consumer loans 2,237 2,152 2,153
-------------- ----- ----- -----
Total loans 45,470 44,151 46,057
Less allowance for
loan losses (598) (604) (629)
------------------ ---- ---- ----
Net loans 44,872 43,547 45,428
Premises and equipment 594 604 622
Accrued income and
other assets 3,891 3,837 4,063
------------------ ----- ----- -----
Total assets $65,227 $64,670 $65,069
------------ ------- ------- -------
LIABILITIES AND
SHAREHOLDERS' EQUITY
Noninterest-bearing
deposits $23,875 $23,896 $23,279
Money market and
interest-bearing
checking deposits 22,332 21,697 21,273
Savings deposits 1,673 1,645 1,606
Customer certificates
of deposit 5,063 5,180 5,531
Foreign office time
deposits 349 491 502
------------------- --- --- ---
Total interest-
bearing deposits 29,417 29,013 28,912
----------------- ------ ------ ------
Total deposits 53,292 52,909 52,191
Short-term borrowings 253 226 110
Accrued expenses and
other liabilities 986 1,001 1,106
Medium- and long-
term debt 3,543 3,565 4,720
----------------- ----- ----- -----
Total liabilities 58,074 57,701 58,127
Common stock -$5 par
value:
Authorized -
325,000,000 shares
Issued -228,164,824
shares 1,141 1,141 1,141
Capital surplus 2,179 2,171 2,162
Accumulated other
comprehensive loss (391) (541) (413)
Retained earnings 6,321 6,239 5,931
Less cost of common
stock in treasury -
45,860,786 shares at
12/31/13, 44,483,659
shares at 9/30/13 and
39,889,610 shares at
12/31/12 (2,097) (2,041) (1,879)
---------------------- ------ ------ ------
Total shareholders'
equity 7,153 6,969 6,942
------------------- ----- ----- -----
Total liabilities and
shareholders' equity $65,227 $64,670 $65,069
--------------------- ------- ------- -------
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (unaudited)
Comerica Incorporated and Subsidiaries
Three Months
Ended Years Ended
December 31, December 31,
------------ ------------
(in
millions,
except
per
share
data) 2013 2012 2013 2012
---------- ---- ---- ---- ----
INTEREST INCOME
Interest
and fees
on loans $397 $398 $1,556 $1,617
Interest
on
investment
securities 55 55 214 234
Interest
on
short-
term
investments 4 3 14 12
------------ --- --- --- ---
Total
interest
income 456 456 1,784 1,863
INTEREST
EXPENSE
Interest
on
deposits 12 16 55 70
Interest
on
medium-
and
long-
term
debt 14 16 57 65
-------- --- --- --- ---
Total
interest
expense 26 32 112 135
--------- --- --- --- ---
Net
interest
income 430 424 1,672 1,728
Provision
for
credit
losses 9 16 46 79
--------- --- --- --- ---
Net
interest
income
after
provision
for
credit
losses 421 408 1,626 1,649
NONINTEREST
INCOME
Service
charges
on
deposit
accounts 53 52 214 214
Fiduciary
income 43 42 171 158
Commercial
lending
fees 28 25 99 96
Card fees 19 17 74 65
Letter of
credit
fees 15 17 64 71
Bank-
owned
life
insurance 9 9 40 39
Foreign
exchange
income 9 9 36 38
Brokerage
fees 4 5 17 19
Net
securities
gains
(losses) - 1 (1) 12
Other
noninterest
income 24 27 112 106
------------ --- --- --- ---
Total
noninterest
income 204 204 826 818
NONINTEREST
EXPENSES
Salaries 197 196 763 778
Employee
benefits 61 59 246 240
--------- --- --- --- ---
Total
salaries
and
employee
benefits 258 255 1,009 1,018
Net
occupancy
expense 41 42 160 163
Equipment
expense 15 15 60 65
Outside
processing
fee
expense 30 28 119 107
Software
expense 24 23 90 90
Litigation-
related
expense 52 - 52 23
FDIC
insurance
expense 7 9 33 38
Advertising
expense 3 6 21 27
Other
real
estate
expense (1) 3 2 9
Merger
and
restructuring
charges - 2 - 35
Other
noninterest
expenses 44 44 176 182
------------ --- --- --- ---
Total
noninterest
expenses 473 427 1,722 1,757
------------ --- --- ----- -----
Income
before
income
taxes 152 185 730 710
Provision
for
income
taxes 35 55 189 189
--------- --- --- --- ---
NET
INCOME 117 130 541 521
Less
income
allocated
to
participating
securities 2 2 8 6
-------------- --- --- --- ---
Net
income
attributable
to
common
shares $115 $128 $533 $515
------------- ---- ---- ---- ----
Earnings per
common share:
Basic $0.64 $0.68 $2.92 $2.68
Diluted 0.62 0.68 2.85 2.67
Comprehensive
income
(loss) 267 (30) 563 464
Cash
dividends
declared
on
common
stock 31 28 126 106
Cash
dividends
declared
per
common
share 0.17 0.15 0.68 0.55
---------- ---- ---- ---- ----
CONSOLIDATED QUARTERLY STATEMENTS OF COMPREHENSIVE INCOME (unaudited)
Comerica Incorporated and Subsidiaries
Fourth Third Second First Fourth Fourth Quarter 2013 Compared To:
Quarter Quarter Quarter Quarter Quarter Third Quarter Fourth Quarter
2013 2012
(in millions,
except per
share data) 2013 2013 2013 2013 2012 Amount Percent Amount Percent
------------- ---- ---- ---- ---- ---- ------ ------- ------ -------
INTEREST INCOME
Interest and
fees on loans $397 $381 $388 $390 $398 $16 4% $(1) - %
Interest on
investment
securities 55 54 52 53 55 1 2 - -
Interest on
short-term
investments 4 4 3 3 3 - - 1 27
------------ --- --- --- --- --- --- --- --- ---
Total interest
income 456 439 443 446 456 17 4 - -
INTEREST EXPENSE
Interest on
deposits 12 13 15 15 16 (1) (8) (4) (24)
Interest on
medium- and
long-term debt 14 14 14 15 16 - - (2) (15)
--------------- --- --- --- --- --- --- --- --- ---
Total interest
expense 26 27 29 30 32 (1) (5) (6) (20)
-------------- --- --- --- --- --- --- --- --- ---
Net interest
income 430 412 414 416 424 18 4 6 1
Provision for
credit losses 9 8 13 16 16 1 22 (7) (42)
-------------- --- --- --- --- --- --- --- --- ---
Net interest
income after
provision 421 404 401 400 408 17 4 13 3
for credit losses
NONINTEREST INCOME
Service charges
on deposit
accounts 53 53 53 55 52 - - 1 1
Fiduciary income 43 41 44 43 42 2 2 1 4
Commercial
lending fees 28 28 22 21 25 - - 3 6
Card fees 19 20 18 17 17 (1) (1) 2 15
Letter of credit
fees 15 17 16 16 17 (2) (9) (2) (13)
Bank-owned life
insurance 9 12 10 9 9 (3) (25) - -
Foreign exchange
income 9 9 9 9 9 - - - -
Brokerage fees 4 4 4 5 5 - - (1) (14)
Net securities
gains (losses) - 1 (2) - 1 (1) (43) (1) (82)
Other
noninterest
income 24 29 34 25 27 (5) (16) (3) (6)
------------ --- --- --- --- --- --- --- --- ---
Total
noninterest
income 204 214 208 200 204 (10) (5) - -
NONINTEREST EXPENSES
Salaries 197 196 182 188 196 1 - 1 1
Employee
benefits 61 59 63 63 59 2 3 2 4
--------- --- --- --- --- --- --- --- --- ---
Total salaries
and employee
benefits 258 255 245 251 255 3 1 3 1
Net occupancy
expense 41 41 39 39 42 - - (1) (2)
Equipment
expense 15 15 15 15 15 - - - -
Outside
processing fee
expense 30 31 30 28 28 (1) (7) 2 5
Software expense 24 22 22 22 23 2 11 1 6
Litigation-
related expense 52 (4) 1 3 - 56 N/M 52 N/M
FDIC insurance
expense 7 9 8 9 9 (2) (19) (2) (22)
Advertising
expense 3 6 6 6 6 (3) (49) (3) (48)
Other real
estate expense (1) 1 1 1 3 (2) N/M (4) N/M
Merger and
restructuring
charges - - - - 2 - - (2) N/M
Other
noninterest
expenses 44 41 49 42 44 3 7 - -
------------ --- --- --- --- --- --- --- --- ---
Total
noninterest
expenses 473 417 416 416 427 56 13 46 11
------------ --- --- --- --- --- --- --- --- ---
Income before
income taxes 152 201 193 184 185 (49) (25) (33) (18)
Provision for
income taxes 35 54 50 50 55 (19) (35) (20) (36)
------------- --- --- --- --- --- --- --- --- ---
NET INCOME 117 147 143 134 130 (30) (21) (13) (10)
Less income
allocated to
participating
securities 2 2 2 2 2 - - - -
-------------- --- --- --- --- --- --- --- --- ---
Net income
attributable to
common shares $115 $145 $141 $132 $128 $(30) (21)% $(13) (10)%
---------------- ---- ---- ---- ---- ---- ---- ---- ---- ----
Earnings per common
share:
Basic $0.64 $0.80 $0.77 $0.71 $0.68 $(0.16) (20)% $(0.04) (6)%
Diluted 0.62 0.78 0.76 0.70 0.68 (0.16) (21) (0.06) (9)
Comprehensive
income (loss) 267 144 15 137 (30) 123 87 297 N/M
Cash dividends
declared on
common stock 31 31 32 32 28 - - 3 10
Cash dividends
declared per
common share 0.17 0.17 0.17 0.17 0.15 - - 0.02 13
-------------- ---- ---- ---- ---- ---- --- --- ---- ---
N/M - Not Meaningful
CONSOLIDATED STATISTICAL DATA (unaudited)
Comerica Incorporated and Subsidiaries
December 31, September 30, June 30, March 31, December 31,
(in
millions,
except per
share
data) 2013 2013 2013 2013 2012
----------- ---- ---- ---- ---- ----
Commercial loans:
Floor plan $3,504 $2,869 $3,241 $2,963 $2,939
Other 25,311 25,028 25,945 25,545 26,574
----- ------ ------ ------ ------ ------
Total
commercial
loans 28,815 27,897 29,186 28,508 29,513
Real estate construction
loans:
Commercial
Real
Estate
business
line (a) 1,447 1,283 1,223 1,185 1,049
Other
business
lines (b) 315 269 256 211 191
---------- --- --- --- --- ---
Total real
estate
construction
loans 1,762 1,552 1,479 1,396 1,240
Commercial mortgage
loans:
Commercial
Real
Estate
business
line (a) 1,678 1,592 1,743 1,812 1,873
Other
business
lines (b) 7,109 7,193 7,264 7,505 7,599
---------- ----- ----- ----- ----- -----
Total
commercial
mortgage
loans 8,787 8,785 9,007 9,317 9,472
Lease
financing 845 829 843 853 859
International
loans 1,327 1,286 1,209 1,269 1,293
Residential
mortgage
loans 1,697 1,650 1,611 1,568 1,527
Consumer loans:
Home equity 1,517 1,501 1,474 1,498 1,537
Other
consumer 720 651 650 658 616
--------- --- --- --- --- ---
Total
consumer
loans 2,237 2,152 2,124 2,156 2,153
--------- ----- ----- ----- ----- -----
Total loans $45,470 $44,151 $45,459 $45,067 $46,057
----------- ------- ------- ----- ------- -------
Goodwill $635 $635 $635 $635 $635
Core
deposit
intangible 16 17 18 19 20
Loan
servicing
rights 1 1 2 2 2
Tier 1
common
capital
ratio (c)
(d) 10.56% 10.72% 10.43% 10.37% 10.14%
Tier 1
risk-
based
capital
ratio (c) 10.56 10.72 10.43 10.37 10.14
Total risk-
based
capital
ratio (c) 13.00 13.42 13.29 13.41 13.15
Leverage
ratio (c) 10.77 10.88 10.81 10.75 10.57
Tangible
common
equity
ratio (d) 10.07 9.87 10.04 9.86 9.76
Common
shareholders'
equity per
share of
common
stock $39.23 $37.94 $37.32 $37.41 $36.87
Tangible
common
equity per
share of
common
stock (d) 35.65 34.38 33.79 33.90 33.38
Market value per share
for the quarter:
High 48.69 43.49 40.44 36.99 32.14
Low 38.64 38.56 33.55 30.73 27.72
Close 47.54 39.31 39.83 35.95 30.34
Quarterly ratios:
Return on
average
common
shareholders'
equity 6.66% 8.50% 8.23% 7.68% 7.36%
Return on
average
assets 0.72 0.92 0.90 0.84 0.81
Efficiency
ratio (e) 74.55 66.66 66.43 67.58 68.08
Number of
banking
centers 483 484 484 487 487
Number of
employees
-full
time
equivalent 8,948 8,918 8,929 9,001 9,035
----------- ----- ----- ----- ----- -----
Primarily
loans to
real
estate
(a) developers.
(b) Primarily loans
secured by
owner-occupied
real estate.
(c) December 31, 2013 ratios
are estimated.
(d) See Reconciliation of Non-
GAAP Financial Measures.
Noninterest expenses as
a percentage of the
sum of net interest
income (FTE) and
noninterest income
excluding net
(e) securities gains.
PARENT COMPANY ONLY BALANCE SHEETS (unaudited)
Comerica Incorporated
December 31, September 30, December 31,
(in millions, except
share data) 2013 2013 2012
-------------------- ---- ---- ----
ASSETS
Cash and due from
subsidiary bank $31 $36 $2
Short-term
investments with
subsidiary bank 482 480 431
Other short-term
investments 96 92 88
Investment in
subsidiaries,
principally banks 7,176 7,008 7,045
Premises and equipment 4 4 4
Other assets 139 134 150
------------ --- --- ---
Total assets $7,928 $7,754 $7,720
------------ ------ ------ ------
LIABILITIES AND
SHAREHOLDERS' EQUITY
Medium- and long-
term debt $617 $620 $629
Other liabilities 158 165 149
----------------- --- --- ---
Total liabilities 775 785 778
Common stock -$5 par
value:
Authorized -
325,000,000 shares
Issued -228,164,824
shares 1,141 1,141 1,141
Capital surplus 2,179 2,171 2,162
Accumulated other
comprehensive loss (391) (541) (413)
Retained earnings 6,321 6,239 5,931
Less cost of common
stock in treasury -
45,860,786 shares at
12/31/13, 44,483,659
shares at 9/30/13 and
39,889,610 shares at
12/31/12 (2,097) (2,041) (1,879)
---------------------- ------ ------ ------
Total shareholders'
equity 7,153 6,969 6,942
------------------- ----- ----- -----
Total liabilities and
shareholders' equity $7,928 $7,754 $7,720
--------------------- ------ ------ ------
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (unaudited)
Comerica Incorporated and Subsidiaries
Accumulated
Common Stock Other Total
------------
Shares Capital Comprehensive Retained Treasury Shareholders'
(in millions,
except per
share data) Outstanding Amount Surplus Loss Earnings Stock Equity
------------- ----------- ------ ------- ---- -------- ----- ------
BALANCE AT
DECEMBER 31,
2011 197.3 $1,141 $2,170 $(356) $5,546 $(1,633) $6,868
Net income - - - - 521 - 521
Other
comprehensive
loss, net of
tax - - - (57) - - (57)
Cash dividends
declared on
common stock
($0.55 per
share) - - - - (106) - (106)
Purchase of
common stock (10.2) - - - - (308) (308)
Net issuance of
common stock
under employee
stock plans 1.2 - (46) - (30) 63 (13)
Share-based
compensation - - 37 - - - 37
Other - - 1 - - (1) -
----- --- --- --- --- --- --- ---
BALANCE AT
DECEMBER 31,
2012 188.3 $1,141 $2,162 $(413) $5,931 $(1,879) $6,942
Net income - - - - 541 - 541
Other
comprehensive
income, net of
tax - - - 22 - - 22
Cash dividends
declared on
common stock
($0.68 per
share) - - - - (126) - (126)
Purchase of
common stock (7.5) - - - - (291) (291)
Net issuance of
common stock
under employee
stock plans 1.5 - (17) - (25) 72 30
Share-based
compensation - - 35 - - - 35
Other - - (1) - - 1 -
BALANCE AT
DECEMBER 31,
2013 182.3 $1,141 $2,179 $(391) $6,321 $(2,097) $7,153
------------- ----- ------ ------ ----- ------ ------- ------
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES (unaudited)
Comerica Incorporated and Subsidiaries
December 31, September 30, June 30, March 31, December 31,
(dollar
amounts in
millions) 2013 2013 2013 2013 2012
----------- ---- ---- ---- ---- ----
Tier 1 Common Capital
Ratio:
Tier 1 and
Tier 1
common
capital
(a) (b) $6,895 $6,862 $6,800 $6,748 $6,705
---------- ------ ------ ------ ------ ------
Risk-
weighted
assets (a)
(b) $65,317 $64,027 $65,220 $65,099 $66,115
----------- ------- ------- ----- ------- -------
Tier 1 and
Tier 1
common
risk-
based
capital
ratio (b) 10.56% 10.72% 10.43% 10.37% 10.14%
Basel III Tier 1 Common
Capital Ratio:
Tier 1
common
capital
(b) $6,895 $6,862 $6,800 $6,748 $6,705
Basel III
adjustments
(c) (6) (4) - (1) (39)
------------ --- --- --- --- ---
Basel III
Tier 1
common
capital
(c) 6,889 6,858 6,800 6,747 6,666
--------- ----- ----- ----- ----- -----
Risk-
weighted
assets (a)
(b) $65,317 $64,027 $65,220 $65,099 $66,115
Basel III
adjustments
(c) 1,735 1,726 2,091 1,996 1,854
----- ----- ----- ----- -----
Basel III
risk-
weighted
assets (c) $67,052 $65,753 $67,311 $67,095 $67,969
----------- ------- ------- ----- ------- -------
Tier 1
common
capital
ratio (b) 10.6% 10.7% 10.4% 10.4% 10.1%
Basel III
Tier 1
common
capital
ratio (c) 10.3 10.4 10.1 10.1 9.8
---------- ---- ---- ---- ---- ---
Tangible Common Equity
Ratio:
Common
shareholders'
equity $7,153 $6,969 $6,911 $6,988 $6,942
Less:
Goodwill 635 635 635 635 635
Other
intangible
assets 17 18 20 21 22
--- --- --- --- ---
Tangible
common
equity $6,501 $6,316 $6,256 $6,332 $6,285
-------- ------ ------ ------ ------ ------
Total
assets $65,227 $64,670 $62,947 $64,885 $65,069
Less:
Goodwill 635 635 635 635 635
Other
intangible
assets 17 18 20 21 22
--- --- --- --- ---
Tangible
assets $64,575 $64,017 $62,292 $64,229 $64,412
-------- ------- ------- ----- ------- -------
Common
equity
ratio 10.97% 10.78% 10.98% 10.77% 10.67%
Tangible
common
equity
ratio 10.07 9.87 10.04 9.86 9.76
-------- ----- ---- ----- ---- ----
Tangible Common Equity
per Share of Common
Stock:
Common
shareholders'
equity $7,153 $6,969 $6,911 $6,988 $6,942
Tangible
common
equity 6,501 6,316 6,256 6,332 6,285
-------- ----- ----- ----- ----- -----
Shares of
common
stock
outstanding
(in
millions) 182 184 185 187 188
------------ --- --- --- --- ---
Common
shareholders'
equity per
share of
common
stock $39.23 $37.94 $37.32 $37.41 $36.87
Tangible
common
equity per
share of
common
stock 35.65 34.38 33.79 33.90 33.38
----------- ----- ----- ----- ----- -----
(a) Tier 1 capital and risk-
weighted assets as defined
by regulation.
(b) December 31, 2013 Tier 1
capital and risk-weighted
assets are estimated.
(c) Estimated ratios based on
the standardized approach
in the final rule for the
U.S. adoption of the Basel
III regulatory capital
framework and excluding
most elements of AOCI.
The Tier 1 common capital ratio removes preferred stock and qualifying trust preferred securities from Tier 1 capital as defined by and calculated in conformity with bank regulations. The Basel III Tier 1 common capital ratio further adjusts Tier 1 common capital and risk-weighted assets to account for the final rule approved by U.S. banking regulators in July 2013 for the U.S. adoption of the Basel III regulatory capital framework. The final Basel III capital rules are effective January 1, 2015 for banking organizations subject to the standardized approach. The tangible common equity ratio removes preferred stock and the effect of intangible assets from capital and the effect of intangible assets from total assets. Tangible common equity per share of common stock removes the effect of intangible assets from common shareholders equity per share of common stock. Comerica believes these measurements are meaningful measures of capital adequacy used by investors, regulators, management and others to evaluate the adequacy of common equity and to compare against other companies in the industry.
SOURCE Comerica Incorporated
