DALLAS, Jan. 19, 2016 /PRNewswire/ -- Comerica Incorporated (NYSE: CMA) today reported full-year 2015 net income of $535 million, or $2.92 per diluted share, compared to $593 million, or $3.16 per diluted share for full-year 2014. Fourth quarter 2015 net income was $130 million, compared to $136 million for the third quarter 2015 and $149 million for the fourth quarter 2014. Earnings per diluted share were 71 cents for fourth quarter 2015 compared to 74 cents for third quarter 2015 and 80 cents for fourth quarter 2014.
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(dollar
amounts
in
millions,
except
per
share
data) 4th Qtr '15 3rd Qtr '15 4th Qtr '14
--------- ----------- ----------- -----------
Net
interest
income $433 $422 $415
Provision
for
credit
losses 35 26 2
Noninterest
income
(a) 270 264 225
Noninterest
expenses
(a) 489 461 419
Provision
for
income
taxes 49 63 70
Net
income 130 136 149
Net
income
attributable
to
common
shares 129 134 148
Diluted
income
per
common
share 0.71 0.74 0.80
Average
diluted
shares
(in
millions) 179 181 184
Basel
III
common
equity
Tier
1
capital
ratio
(b)
(c) 10.53% 10.51% n/a
Tier
1
common
capital
ratio
(b)
(d) n/a n/a 10.50%
Tangible
common
equity
ratio
(d) 9.72 9.91 9.85
Tangible
common
equity
per
share
of
common
stock
(d) $39.41 $39.36 $37.72
-------- ------ ------ ------
(a) Effective
January 1,
2015,
contractual
changes to a
card program
resulted in a
change to the
accounting
presentation
of the related
revenues and
expenses. The
effect of this
change was
increases of
$45 million
and $48
million to
both
noninterest
income and
noninterest
expenses in
the fourth and
third quarters
of 2015,
respectively.
(b) Basel III capital rules (standardized
approach) became effective for
Comerica on January 1, 2015. The
ratio reflects transitional
treatment for certain regulatory
deductions and adjustments. For
further information, see "Balance
Sheet and Capital Management".
Capital ratios for prior periods are
based on Basel I rules.
(c) December 31, 2015 ratio is estimated.
(d) See Reconciliation of Non-GAAP
Financial Measures.
n/a - not applicable.
---------------------
"In 2015 we had good balance sheet growth as average loans topped $48 billion and average deposits grew to a record $58 billion," said Ralph W. Babb, Jr., chairman and chief executive officer. "All the while, we are navigating our way through a modestly growing U.S. economy, as well as increased regulatory and technology demands. Credit quality continued to be solid, and while net charge-offs and the provision increased, they remain below normal historical levels. Through buybacks and dividends we returned $389 million or 73 percent of 2015 net income to shareholders. Both our book value and tangible book value per share increased 4 percent over the past year, as we continue to focus on creating long-term shareholder value.
"With respect to the fourth quarter, revenue increased more than 2 percent. This was a result of growth in net interest income, which benefited from higher nonaccrual interest and the rise in rates late in the quarter, as well as an increase in fee generation, particularly commercial lending and card fees. Technology and regulatory costs drove noninterest expenses higher, as anticipated. Negative credit migration in our energy exposure continued as expected, while overall our customers have been acting prudently as evidenced by declining loan balances. The remainder of the loan book continues to perform well. We increased our share buyback to $65 million from the $59 million that was repurchased in each of the past six quarters.
"As we look forward to the year ahead, we remain keenly focused on growing loans and deposits along with managing expenses as we make necessary investments. With the Federal Reserve increasing its benchmark rate 25 basis points in December, our revenue picture looks better, as our balance sheet remains well positioned to benefit from rising rates. With oil prices at a cyclical low, we have been closely monitoring our energy customers. In each quarter of 2015, we increased our reserves for energy and related loans((a)). Well into the cycle, we continue to feel comfortable with our energy portfolio. In summary, we are committed to providing high quality financial services and building lasting customer relationships, which combined with our diverse geographic footprint, will continue to assist us in building long-term shareholder value."
((a) )Loans related to energy at December 31, 2015 included approximately $3.1 billion of outstanding loans in our Energy business line as well as approximately $625 million of loans in other lines of business to companies that have a sizable portion of their revenue related to energy or could be otherwise disproportionately negatively impacted by prolonged low oil and gas prices.
Full-Year 2015 and Fourth Quarter Overview
Full-Year 2015 Compared to Full-Year 2014
-- Average total loans increased $2.0 billion, or 4 percent, to $48.6
billion in 2015, reflecting increases in almost all lines of business,
with the largest increases in Technology and Life Sciences, Mortgage
Banker Finance, National Dealer Services and Commercial Real Estate,
partially offset by a decrease in Corporate Banking. Period-end loans
increased $516 million, or 1 percent, to $49.1 billion, primarily
reflecting increases in Mortgage Banker Finance, Technology and Life
Sciences, Commercial Real Estate and National Dealer Services, partially
offset by decreases in general Middle Market, Corporate Banking and
Energy.
-- Average total deposits increased $3.5 billion, or 6 percent, to $58.3
billion in 2015, reflecting increases of $3.1 billion, or 12 percent, in
noninterest-bearing deposits and $474 million, or 2 percent, in
interest-bearing deposits. Period-end deposits increased $2.4 billion,
or 4 percent, to $59.9 billion, reflecting an increase of $3.6 billion,
or 13 percent, in noninterest-bearing deposits, partially offset by a
decrease of $1.2 billion, or 4 percent, in interest-bearing deposits.
-- Net interest income of $1.7 billion for 2015 increased by $34 million,
or 2 percent, primarily as a result of higher earning asset volume,
partially offset by lower loan yields, in part due to a decrease in
accretion of the purchase discount on the acquired loan portfolio and
continued pressure on yields from the low-rate environment and loan
portfolio dynamics.
-- The allowance for loan losses increased $40 million compared to 2014,
primarily due to increases in reserves related to energy and Technology
and Life Sciences, partially offset by improvements in credit quality in
the remainder of the portfolio. Net charge-offs were $75 million, or
0.15 percent of average loans, for 2015, compared to $25 million, or
0.05 percent of average loans, for 2014. The provision for credit losses
increased $95 million to $122 million in 2015, compared to 2014.
-- Noninterest income increased $182 million to $1.1 billion in 2015.
Excluding the $181 million impact of a change to the accounting
presentation for a card program, noninterest income was stable.
Increases in card fees, service charges on deposit accounts and
fiduciary income were largely offset by lower investment banking income,
lower fee income on certain categories impacted by regulatory changes
and decreases in several non-fee categories.
-- Noninterest expenses increased $219 million to $1.8 billion in 2015.
Excluding the $181 million impact of a change to the accounting
presentation for a card program, noninterest expenses increased $38
million, or 2 percent, primarily due to increases in technology and
regulatory expenses, outside processing fees and pension expense,
partially offset by a $36 million decrease in litigation-related
expenses, reflecting the release of $33 million of litigation reserves
in the second and third quarters of 2015, and cost savings realized in
2015 from certain actions taken in the second half of 2014.
-- Comerica repurchased approximately 5.1 million shares of common stock
and 500,000 warrants during 2015 under the equity repurchase program.
Together with dividends of $0.83 per share, $389 million was returned to
shareholders.
Fourth Quarter 2015 Compared to Third Quarter 2015
-- Average total loans decreased $424 million to $48.5 billion, primarily
reflecting decreases in Mortgage Banker Finance, general Middle Market,
Energy and Corporate Banking, partially offset by increases in
Commercial Real Estate and National Dealer Services. Period-end total
loans increased $167 million, to $49.1 billion, largely driven by
increases in National Dealer Services, Mortgage Banker Finance and
Commercial Real Estate, partially offset by decreases in general Middle
Market and Energy.
-- Average total deposits increased $596 million, or 1 percent, to $59.7
billion, primarily driven by a $1.0 billion increase in
noninterest-bearing deposits. The increase in average total deposits was
primarily due to increases in Corporate Banking and Private Banking,
partially offset by decreases in Technology and Life Sciences and
general Middle Market. Average deposits increased in all major
geographic markets. Period-end total deposits increased $1.1 billion to
$59.9 billion.
-- Net interest income increased $11 million to $433 million compared to
third quarter 2015, primarily reflecting an increase in loan yields,
largely due to higher interest recognized on nonaccrual loans and the
increase in short-term rates, and a larger securities portfolio,
partially offset by a decrease in average loans.
-- The allowance for loan losses increased $12 million in the fourth
quarter 2015, primarily due to an increase in reserves related to
energy. Net charge-offs were $26 million, or 0.21 percent of average
loans, in the fourth quarter 2015, compared to $23 million, or 0.19
percent, in the third quarter 2015. As a result, the provision for
credit losses was $35 million for the fourth quarter 2015.
-- Noninterest income increased $6 million in the fourth quarter 2015,
primarily the result of an increase in commercial lending fees.
-- Noninterest expenses increased $28 million in the fourth quarter 2015,
primarily due to increases in technology and regulatory-related contract
labor and consulting expenses, as well as seasonally higher staff
insurance expense. Additionally, the third quarter 2015 benefited from a
release of $3 million of litigation reserves, low deferred compensation
expense and lower share-based compensation expense as a result of
forfeitures, which were not repeated in the fourth quarter.
-- The provision for income taxes decreased $14 million in the fourth
quarter 2015. The effective tax rate was 28 percent for the fourth
quarter 2015, compared to 32 percent in the third quarter 2015,
primarily reflecting a $5 million tax benefit from the early termination
of certain leveraged lease transactions.
-- Capital remained solid at December 31, 2015, as evidenced by an
estimated common equity Tier 1 capital ratio of 10.53 percent and a
tangible common equity ratio of 9.72 percent.
-- Comerica repurchased approximately 1.5 million shares of common stock
under the equity repurchase program, which, together with dividends,
returned $102 million to shareholders.
Net Interest Income
-------------------
(dollar amounts
in millions) 4th Qtr '15 3rd Qtr '15 4th Qtr '14
--------------- ----------- ----------- -----------
Net interest
income $433 $422 $415
Net interest
margin 2.58% 2.54% 2.57%
Selected average
balances:
Total earning
assets $66,818 $66,191 $64,453
Total loans 48,548 48,972 47,361
Total investment
securities 10,864 10,232 9,365
Federal Reserve
Bank deposits 7,073 6,710 7,463
Total deposits 59,736 59,140 57,760
Total
noninterest-
bearing deposits 29,627 28,623 27,504
----------------- ------ ------ ------
-- Net interest income increased $11 million to $433 million in the fourth
quarter 2015, compared to the third quarter 2015.
-- Interest on loans increased $5 million, reflecting higher interest
recognized on nonaccrual loans (+$6 million) and higher loan yields
(+$3 million), partially offset by the impact of lower average loan
balances (-$3 million) and a decrease in accretion of the purchase
discount on the acquired loan portfolio (-$1 million).
-- Interest on investment securities increased $2 million, primarily
reflecting the reinvestment of excess Federal Reserve Bank deposits
into higher yielding Treasury securities in the fourth quarter 2015.
-- Interest on short-term investments increased $2 million, primarily
reflecting an increase in average Federal Reserve Bank deposit
balances.
-- The net interest margin of 2.58 percent increased 4 basis points
compared to the third quarter 2015, primarily due to the impact of
higher interest recognized on nonaccrual loans (+3 basis points) and
higher loan yields (+2 basis points), partially offset by the impact of
an increase in Federal Reserve Bank deposit balances (-1 basis point).
Noninterest Income
Noninterest income increased $6 million to $270 million in the fourth quarter 2015, compared to $264 million for the third quarter 2015. The increase primarily reflected increases of $8 million in commercial lending fees (primarily syndication agent fees) and $6 million in deferred compensation asset returns, partially offset by decreases of $4 million in warrant-related income and $3 million in hedge ineffectiveness income. The increase in deferred compensation asset returns was offset by an increase in deferred compensation plan expense in noninterest expenses.
Noninterest Expenses
Noninterest expenses increased $28 million to $489 million in the fourth quarter 2015, compared to $461 million for the third quarter 2015, primarily reflecting a $22 million increase in salaries and benefits expense, a $3 million increase in litigation-related expense, reflecting the release of reserves in the third quarter 2015, and smaller increases in several other categories, partially offset by a $3 million decrease in outside processing fees. The increase in salaries and benefits expense primarily reflected an increase in technology-related contract labor expense and higher staff insurance expense. Additionally, benefits in the third quarter 2015 from low deferred compensation expense and lower share-based compensation expense as a result of forfeitures were not repeated in the fourth quarter.
Credit Quality
"Net charge-offs were 21 basis points of average loans in the fourth quarter, remaining below historical normal levels," said Babb. "Given persistently low oil and gas prices, we continue to see negative migration in the energy book, which has resulted in an increase in criticized loans, nonaccrual loans and charge-offs. We have appropriately increased our reserves for energy and related loans in each quarter of 2015, and as of quarter end, our reserve allocation for energy and related loans was more than 4 percent of our total of these loans. Loans in our Energy line of business have declined by approximately $700 million from the February peak and, as of year-end, totaled about $3.1 billion, or about 6.25 percent of our total loans. Well into the cycle, we continue to feel comfortable with our energy and related exposure, and the remainder of the portfolio continues to perform well."
(dollar amounts in millions) 4th Qtr '15 3rd Qtr '15 4th Qtr '14
--------------------------- ----------- ----------- -----------
Loan charge-offs $51 $34 $20
Loan recoveries 25 11 19
--- --- ---
Net loan charge-offs 26 23 1
Net loan charge-offs/Average
total loans 0.21% 0.19% 0.01%
Provision for credit losses $35 $26 $2
Nonperforming loans (a) 379 369 290
Nonperforming assets (NPAs) (a) 391 381 300
NPAs/Total loans and foreclosed
property 0.80% 0.78% 0.62%
Loans past due 90 days or more and
still accruing $17 $5 $5
Allowance for loan losses 634 622 594
Allowance for credit losses on
lending-related commitments (b) 45 48 41
--- --- ---
Total allowance for credit losses 679 670 635
Allowance for loan losses/Period-
end total loans 1.29% 1.27% 1.22%
Allowance for loan losses/
Nonperforming loans 167 169 205
-------------------------- --- --- ---
(a) Excludes loans acquired with credit
impairment.
(b) Included in "Accrued expenses and
other liabilities" on the
consolidated balance sheets.
--- ---------------------------------
-- Net charge-offs increased $3 million to $26 million, or 0.21 percent of
average loans, in the fourth quarter 2015, compared to $23 million, or
0.19 percent, in the third quarter 2015.
-- During the fourth quarter 2015, $105 million of borrower relationships
over $2 million were transferred to nonaccrual status, of which $93
million were loans related to energy.
-- Criticized loans increased $295 million to $3.2 billion at December 31,
2015, compared to $2.9 billion at September 30, 2015, reflecting an
increase of approximately $370 million in criticized loans related to
energy.
Balance Sheet and Capital Management
Total assets and common shareholders' equity were $71.9 billion and $7.6 billion, respectively, at December 31, 2015, compared to $71.0 billion and $7.6 billion, respectively, at September 30, 2015.
There were approximately 176 million common shares outstanding at December 31, 2015. Share repurchases of $65 million (1.5 million shares) under the equity repurchase program, combined with dividends of 21 cents per share, returned 79 percent of fourth quarter 2015 net income to shareholders. Diluted average shares decreased 2 million to 179 million for the fourth quarter 2015.
The estimated common equity Tier 1 capital ratio, reflective of transition provisions and excluding accumulated other comprehensive income ("AOCI"), was 10.53 percent at December 31, 2015. Certain deductions and adjustments to regulatory capital began phasing in on January 1, 2015 and will be fully implemented on January 1, 2018. The estimated ratio under fully phased-in Basel III capital rules is largely the same as the transitional ratio. Comerica's tangible common equity ratio was 9.72 percent at December 31, 2015, a decrease of 19 basis points from September 30, 2015.
Full-Year 2016 Outlook
For full-year 2016 compared to full-year 2015, management expects the following, assuming a continuation of the current economic and low-rate environment:
-- Average loans modestly higher in line with Gross Domestic Product
growth, reflecting a continued decline in Energy more than offset by
increases in most other lines of business.
-- Net interest income higher, reflecting the benefit from the December
2015 short-term rate increase, loan growth and a larger securities
portfolio, more than offsetting higher funding costs.
-- Provision for credit losses higher, with net charge-offs expected to
increase but remain below historical normal levels.
-- Noninterest income modestly higher, primarily due to growth in card fees
from merchant processing services, government card and commercial card.
Continued focus on cross-sell opportunities, including wealth management
products such as fiduciary and brokerage services.
-- Noninterest expenses higher, reflecting continued increases in
technology costs and regulatory expenses, increased outside processing
in line with growing revenue, higher FDIC insurance expense due to
recent regulatory proposal, and typical inflationary pressures.
Additionally, 2015 benefited from a $33 million legal reserve release
which is offset by lower pension expense in 2016.
-- Income tax expense to approximate 32 percent of pre-tax income.
Business Segments
Comerica's operations are strategically aligned into three major business segments: the Business Bank, the Retail Bank and Wealth Management. The Finance Division is also reported as a segment. The financial results below are based on the internal business unit structure of the Corporation and methodologies in effect at December 31, 2015 and are presented on a fully taxable equivalent (FTE) basis. The accompanying narrative addresses fourth quarter 2015 results compared to third quarter 2015.
The following table presents net income (loss) by business segment.
(dollar amounts
in millions) 4th Qtr '15 3rd Qtr '15 4th Qtr '14
--------------- ----------- ----------- -----------
Business Bank $199 85% $194 85% $216 87%
Retail Bank 14 6 13 6 11 4
Wealth Management 21 9 21 9 22 9
----------------- --- --- --- --- --- ---
234 100% 228 100% 249 100%
Finance (102) (93) (100)
Other (a) (2) 1 -
-------- --- --- ---
Total $130 $136 $149
----- ---- ---- ----
(a) Includes items not directly
associated with the three
major business segments or
the Finance Division.
Business Bank
(dollar
amounts
in
millions) 4th Qtr '15 3rd Qtr '15 4th Qtr '14
---------- ----------- ----------- -----------
Net
interest
income
(FTE) $387 $380 $387
Provision
for
credit
losses 41 30 8
Noninterest
income 147 145 104
Noninterest
expenses 210 202 148
Net
income 199 194 216
Net
loan
charge-
offs
(recoveries) 35 23 (1)
Selected
average
balances:
Assets 38,765 39,210 37,896
Loans 37,682 38,113 36,890
Deposits 31,738 31,397 30,897
-------- ------ ------ ------
-- Average loans decreased $431 million, primarily reflecting decreases in
Mortgage Banker Finance, general Middle Market, Energy and Corporate
Banking, partially offset by increases in Commercial Real Estate and
National Dealer Services.
-- Average deposits increased $341 million, primarily reflecting an
increase in Corporate Banking, partially offset by decreases in
Technology and Life Sciences and general Middle Market.
-- Net interest income increased $7 million, primarily reflecting higher
interest recognized on nonaccrual loans and higher loan yields, as well
as an increase in net funds transfer pricing (FTP) credits, largely due
to the increase in average deposits and an increase in the deposit
crediting rate, partially offset by the impact of a decrease in average
loan balances.
-- The allowance for loan losses increased $8 million, primarily due to an
increase in reserves related to Energy, partially offset by decreases in
reserves related to general Middle Market and Technology and Life
Sciences. Net charge-offs increased $12 million, primarily reflecting an
increase in Energy, partially offset by a decrease in general Middle
Market. As a result, the provision for credit losses was $41 million for
the fourth quarter 2015.
-- Noninterest income increased $2 million, primarily due to increases in
commercial lending fees (primarily syndication agent fees), and card
fees, partially offset by decreases in warrant-related income and
customer derivative income.
-- Noninterest expenses increased $8 million, primarily due to increases in
corporate overhead expenses and salaries and benefits expense, partially
offset by a decrease in outside processing fees. The increase in
corporate overhead expense was largely the result of increases in
technology costs, regulatory expenses and staff insurance expenses in
the fourth quarter that were allocated to the segments. Additionally,
third quarter 2015 corporate overhead benefited from a release of
litigation reserves.
Retail Bank
(dollar
amounts
in
millions) 4th Qtr '15 3rd Qtr '15 4th Qtr '14
--------- ----------- ----------- -----------
Net
interest
income
(FTE) $160 $158 $152
Provision
for
credit
losses (2) 2 (2)
Noninterest
income 49 49 45
Noninterest
expenses 192 185 182
Net
income 14 13 11
Net
loan
charge-
offs - 1 4
Selected
average
balances:
Assets 6,549 6,518 6,298
Loans 5,868 5,835 5,626
Deposits 23,262 23,079 22,301
-------- ------ ------ ------
-- Average loans increased $33 million, reflecting an increase in Retail
Banking, partially offset by a decrease in Small Business.
-- Average deposits increased $183 million, primarily reflecting increases
in money market and checking deposits, partially offset by a decrease in
time deposits.
-- Net interest income increased $2 million, primarily due to an increase
in loan yields and an increase in net FTP credits, largely due to the
increase in average deposits.
-- The provision for credit losses decreased $4 million, primarily
reflecting a decrease in Personal Banking.
-- Noninterest expenses increased $7 million, primarily reflecting an
increase in corporate overhead expenses. See the Business Bank
discussion for an explanation of the increase in corporate overhead
expense.
Wealth Management
(dollar
amounts in
millions) 4th Qtr '15 3rd Qtr '15 4th Qtr '14
----------- ----------- ----------- -----------
Net interest
income
(FTE) $47 $45 $47
Provision
for credit
losses (7) (3) (9)
Noninterest
income 57 59 60
Noninterest
expenses 81 74 80
Net income 21 21 22
Net loan
charge-
offs
(recoveries) (9) (1) (2)
Selected
average
balances:
Assets 5,199 5,228 5,034
Loans 4,998 5,024 4,845
Deposits 4,355 4,188 4,094
-------- ----- ----- -----
-- Average loans decreased $26 million.
-- Average deposits increased $167 million, primarily reflecting increases
in money market and checking deposits, partially offset by a decrease in
time deposits.
-- Net interest income increased $2 million, primarily due to an increase
in net FTP credits, largely due to the increase in average deposits, and
an increase in loan yields.
-- The provision for credit losses decreased $4 million, from a negative
provision of $3 million in the third quarter 2015 to a negative
provision of $7 million in the fourth quarter 2015, primarily reflecting
a high level of recoveries in the fourth quarter 2015.
-- Noninterest income decreased $2 million, primarily due to lower
fiduciary income.
-- Noninterest expenses increased $7 million, primarily due to an increase
in corporate overhead expenses, for the reasons previously described in
the Business Bank discussion, as well as an increase in operational
losses.
Geographic Market Segments
Comerica also provides market segment results for three primary geographic markets: Michigan, California and Texas. In addition to the three primary geographic markets, Other Markets is also reported as a market segment. Other Markets includes Florida, Arizona, the International Finance division and businesses that have a significant presence outside of the three primary geographic markets. The tables below present the geographic market results based on the methodologies in effect at December 31, 2015 and are presented on a fully taxable equivalent (FTE) basis.
The following table presents net income (loss) by market segment.
(dollar
amounts
in
millions) 4th Qtr '15 3rd Qtr '15 4th Qtr '14
---------- ----------- ----------- -----------
Michigan $83 35% $71 31% $79 32%
California 90 38 62 27 84 34
Texas (4) (1) 36 16 40 16
Other
Markets 65 28 59 26 46 18
-------- --- --- --- --- --- ---
234 100% 228 100% 249 100%
Finance &
Other (a) (104) (92) (100)
---------- ---- --- ----
Total $130 $136 $149
----- ---- ---- ----
(a) Includes items not directly
associated with the
geographic markets.
-- Average loans decreased $237 million in Michigan, primarily reflecting a
decrease in general Middle Market, and $104 million in Texas, primarily
reflecting a decrease in Energy. Average loans increased $244 million in
California, primarily reflecting increases in National Dealer Services
and smaller increases in almost all other lines of business, partially
offset by decreases in general Middle Market and Private Banking.
-- Average deposits increased $177 million in Michigan, $173 million in
California and $54 million in Texas. The increase in Michigan primarily
reflected an increase in general Middle Market. The increase in
California primarily reflected increases in Corporate Banking and
Private Banking, partially offset by decreases in Technology and Life
Sciences and general Middle Market. The increase in Texas primarily
reflected increases in Energy, Retail Banking and Small Business,
partially offset by a decrease in general Middle Market.
-- Net interest income increased $6 million, $3 million and $2 million in
California, Michigan and Texas, respectively. The increase in California
primarily reflected the benefit from an increase in net FTP credits,
largely due to increases in average deposits as well as the deposit
crediting rate, an increase in loan yields and the impact higher average
loan balances. The increases in Michigan and Texas primarily reflects an
increase in loan yields, partially offset by a decrease in average loan
balances. Loan yields in all markets benefited from increased interest
recognized on nonaccrual loans.
-- The provision for credit losses increased $47 million in Texas and
decreased $31 million and $18 million in California and Michigan,
respectively. The increase in Texas primarily reflected an increase in
reserves for Energy. In California, the provision decreased primarily as
a result of decreased reserves for Technology and Life Sciences, while
the decrease in Michigan was primarily the result of a decreased
provision in general Middle Market.
-- Noninterest income decreased $3 million and $2 million in Michigan and
Texas, respectively, and increased $3 million in California. The
decrease in Michigan was primarily due to decreases in fiduciary income,
customer derivative income and small decreases in several other
categories. The decrease in Texas reflected small variances in several
categories, partially offset by an increase syndication agent fees, and
the increase in California primarily reflected an increase in
syndication agent fees.
-- Noninterest expenses increased $10 million in Michigan, $7 million in
Texas and $6 million in California, primarily reflecting increased
corporate overhead expenses, for the same reasons discussed previously,
in the Business Bank section.
Michigan Market
(dollar
amounts
in
millions) 4th Qtr '15 3rd Qtr '15 4th Qtr '14
---------- ----------- ----------- -----------
Net
interest
income
(FTE) $183 $180 $173
Provision
for
credit
losses (12) 6 (19)
Noninterest
income 82 85 89
Noninterest
expenses 162 152 157
Net
income 83 71 79
Net
loan
charge-
offs
(recoveries) (2) 9 (5)
Selected
average
balances:
Assets 13,601 13,856 13,605
Loans 12,986 13,223 13,142
Deposits 22,123 21,946 21,530
-------- ------ ------ ------
California Market
(dollar
amounts
in
millions) 4th Qtr '15 3rd Qtr '15 4th Qtr '14
--------- ----------- ----------- -----------
Net
interest
income
(FTE) $193 $187 $192
Provision
for
credit
losses (7) 24 (10)
Noninterest
income 41 38 37
Noninterest
expenses 108 102 100
Net
income 90 62 84
Net
loan
charge-
offs 1 10 1
Selected
average
balances:
Assets 17,297 17,060 16,035
Loans 17,033 16,789 15,777
Deposits 18,545 18,372 18,028
-------- ------ ------ ------
Texas Market
(dollar
amounts
in
millions) 4th Qtr '15 3rd Qtr '15 4th Qtr '14
--------- ----------- ----------- -----------
Net
interest
income
(FTE) $131 $129 $139
Provision
for
credit
losses 57 10 18
Noninterest
income 32 34 38
Noninterest
expenses 104 97 95
Net
(loss)
income (4) 36 40
Net
loan
charge-
offs 33 4 2
Selected
average
balances:
Assets 11,474 11,578 12,003
Loans 10,893 10,997 11,327
Deposits 10,807 10,753 10,825
-------- ------ ------ ------
Conference Call and Webcast
Comerica will host a conference call to review fourth quarter 2015 financial results at 7 a.m. CT Tuesday January 19, 2016. Interested parties may access the conference call by calling (877) 523-5249 or (210) 591-1147 (event ID No. 93937227). The call and supplemental financial information can also be accessed via Comerica's "Investor Relations" page at www.comerica.com. A replay of the Webcast can be accessed via Comerica's "Investor Relations" page at www.comerica.com.
Comerica Incorporated is 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," "projects," "models" 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 changes in interest rates; changes in regulation or oversight; Comerica's ability to maintain adequate sources of funding and liquidity; the effects of more stringent capital or liquidity requirements; declines or other changes in the businesses or industries of Comerica's customers, including the energy industry; operational difficulties, failure of technology infrastructure or information security incidents; reliance on other companies to provide certain key components of business infrastructure; factors impacting noninterest expenses which are beyond Comerica's control; changes in the financial markets, including fluctuations in interest rates and their impact on deposit pricing; changes in Comerica's credit rating; unfavorable developments concerning credit quality; the interdependence of financial service companies; the implementation of Comerica's strategies and business initiatives; Comerica's ability to utilize technology to efficiently and effectively develop, market and deliver new products and services; competitive product and pricing pressures among financial institutions within Comerica's markets; changes in customer behavior; any future strategic acquisitions or divestitures; 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 12 of Comerica's Annual Report on Form 10-K for the year ended December 31, 2014. 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) 2015 2015 2014 2015 2014
-------------------- ---- ---- ---- ---- ----
PER COMMON SHARE AND COMMON STOCK
DATA
Diluted net income $0.71 $0.74 $0.80 $2.92 $3.16
Cash dividends
declared 0.21 0.21 0.20 0.83 0.79
Average diluted
shares (in
thousands) 179,197 180,714 183,728 181,104 185,474
--------------- ------- ------- ------- ------- -------
KEY RATIOS
Return on average
common shareholders'
equity 6.81% 7.19% 7.96% 7.10% 8.05%
Return on average
assets 0.72 0.76 0.86 0.76 0.89
Common equity tier 1
risk-based capital
ratio (a) (b) 10.53 10.51 n/a
Tier 1 common risk-
based capital ratio
(c) n/a n/a 10.50
Tier 1 risk-based
capital ratio (a)
(b) 10.53 10.51 10.50
Total risk-based
capital ratio (a)
(b) 12.68 12.82 12.51
Leverage ratio (a)
(b) 10.24 10.28 10.35
Tangible common
equity ratio (c) 9.72 9.91 9.85
----------------- ---- ---- ----
AVERAGE BALANCES
Commercial loans 31,219 31,900 30,391 31,501 29,715
Real estate
construction loans 1,961 1,833 1,920 1,884 1,909
Commercial mortgage
loans 8,842 8,691 8,609 8,697 8,706
Lease financing 750 788 818 783 834
International loans 1,402 1,401 1,455 1,441 1,376
Residential mortgage
loans 1,896 1,882 1,821 1,878 1,778
Consumer loans 2,478 2,477 2,347 2,444 2,270
----- ----- ----- -----
Total loans 48,548 48,972 47,361 48,628 46,588
Earning assets 66,818 66,191 64,453 65,129 61,560
Total assets 71,907 71,333 69,307 70,247 66,336
Noninterest-bearing
deposits 29,627 28,623 27,504 28,087 25,019
Interest-bearing
deposits 30,109 30,517 30,256 30,239 29,765
------ ------ ------ ------ ------
Total deposits 59,736 59,140 57,760 58,326 54,784
Common shareholders'
equity 7,613 7,559 7,518 7,534 7,373
-------------------- ----- ----- ----- ----- -----
NET INTEREST INCOME (fully taxable
equivalent basis)
Net interest income $434 $423 $416 $1,693 $1,659
Net interest margin 2.58% 2.54% 2.57% 2.60% 2.70%
------------------- ---- ---- ---- ---- ----
CREDIT QUALITY
Total nonperforming
assets $391 $381 $300
Loans past due 90
days or more and
still accruing 17 5 5
Net loan charge-offs 26 23 1 $75 $25
Allowance for loan
losses 634 622 594
Allowance for credit
losses on lending-
related commitments 45 48 41
--- --- ---
Total allowance for
credit losses 679 670 635
Allowance for loan
losses as a
percentage of total
loans 1.29% 1.27% 1.22%
Net loan charge-offs
as a percentage of
average total loans 0.21 0.19 0.01 0.15% 0.05%
Nonperforming assets
as a percentage of
total loans and
foreclosed property 0.80 0.78 0.62
Allowance for loan
losses as a
percentage of total
nonperforming loans 167 169 205
-------------------- --- --- ---
(a) Basel III rules became effective
on January 1, 2015, with
transitional provisions. All
prior period data is based on
Basel I rules.
(b) December 31, 2015 ratios are
estimated.
(c) See Reconciliation of Non-GAAP
Financial Measures.
n/a - not applicable.
CONSOLIDATED BALANCE SHEETS
Comerica Incorporated and Subsidiaries
December 31, September 30, December 31,
(in millions, except share data) 2015 2015 2014
------------------------------- ---- ---- ----
(unaudited) (unaudited)
ASSETS
Cash and due from banks $1,157 $1,101 $1,026
Interest-bearing deposits with banks 4,990 6,099 5,045
Other short-term investments 113 107 99
Investment securities available-for-
sale 10,519 8,749 8,116
Investment securities held-to-
maturity 1,981 1,863 1,935
Commercial loans 31,684 31,777 31,520
Real estate construction loans 2,001 1,874 1,955
Commercial mortgage loans 8,977 8,787 8,604
Lease financing 724 751 805
International loans 1,368 1,382 1,496
Residential mortgage loans 1,870 1,880 1,831
Consumer loans 2,485 2,491 2,382
-------------- ----- ----- -----
Total loans 49,109 48,942 48,593
Less allowance for loan losses (634) (622) (594)
------------------------------ ---- ---- ----
Net loans 48,475 48,320 47,999
Premises and equipment 550 541 532
Accrued income and other assets 4,110 4,232 4,434
------------------------------- ----- ----- -----
Total assets $71,895 $71,012 $69,186
------------ ------- ------- -------
LIABILITIES AND SHAREHOLDERS' EQUITY
Noninterest-bearing deposits $30,839 $28,697 $27,224
Money market and interest-bearing
checking deposits 23,532 23,948 23,954
Savings deposits 1,898 1,853 1,752
Customer certificates of deposit 3,552 4,126 4,421
Foreign office time deposits 32 144 135
---------------------------- --- --- ---
Total interest-bearing deposits 29,014 30,071 30,262
------------------------------- ------ ------ ------
Total deposits 59,853 58,768 57,486
Short-term borrowings 23 109 116
Accrued expenses and other
liabilities 1,387 1,413 1,507
Medium- and long-term debt 3,058 3,100 2,675
-------------------------- ----- ----- -----
Total liabilities 64,321 63,390 61,784
Common stock - $5 par value:
Authorized - 325,000,000 shares
Issued - 228,164,824 shares 1,141 1,141 1,141
Capital surplus 2,173 2,165 2,188
Accumulated other comprehensive loss (429) (345) (412)
Retained earnings 7,098 7,007 6,744
Less cost of common stock in treasury
-52,457,113 shares at 12/31/15;
51,010,418 shares at 9/30/15 and
49,146,225 shares at 12/31/14 (2,409) (2,346) (2,259)
------------------------------------- ------ ------ ------
Total shareholders' equity 7,574 7,622 7,402
-------------------------- ----- ----- -----
Total liabilities and shareholders'
equity $71,895 $71,012 $69,186
----------------------------------- ------- ------- -------
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) 2015 2014 2015 2014
-------------------- ---- ---- ---- ----
INTEREST INCOME
Interest and fees on
loans $395 $383 $1,551 $1,525
Interest on investment
securities 56 51 216 211
Interest on short-
term investments 6 4 17 14
------------------ --- --- --- ---
Total interest income 457 438 1,784 1,750
INTEREST EXPENSE
Interest on deposits 10 12 43 45
Interest on medium-
and long-term debt 14 11 52 50
------------------- --- --- --- ---
Total interest expense 24 23 95 95
---------------------- --- --- --- ---
Net interest income 433 415 1,689 1,655
Provision for credit
losses 35 2 122 27
-------------------- --- --- --- ---
Net interest income
after provision for
credit losses 398 413 1,567 1,628
NONINTEREST INCOME
Card fees 77 24 290 92
Service charges on
deposit accounts 55 53 223 215
Fiduciary income 45 47 187 180
Commercial lending
fees 30 29 99 98
Letter of credit fees 14 14 53 57
Bank-owned life
insurance 11 8 40 39
Foreign exchange
income 11 10 40 40
Brokerage fees 4 4 17 17
Net securities losses - - (2) -
Other noninterest
income 23 36 103 130
----------------- --- --- --- ---
Total noninterest
income 270 225 1,050 868
NONINTEREST EXPENSES
Salaries and benefits
expense 265 245 1,012 980
Outside processing fee
expense 83 33 332 122
Net occupancy expense 41 46 159 171
Equipment expense 14 14 53 57
Software expense 26 23 99 95
FDIC insurance expense 10 8 37 33
Advertising expense 7 7 24 23
Litigation-related
expense - - (32) 4
Gain on debt
redemption - - - (32)
Other noninterest
expenses 43 43 161 173
----------------- --- --- --- ---
Total noninterest
expenses 489 419 1,845 1,626
----------------- --- --- ----- -----
Income before income
taxes 179 219 772 870
Provision for income
taxes 49 70 237 277
-------------------- --- --- --- ---
NET INCOME 130 149 535 593
Less income allocated
to participating
securities 1 1 6 7
--------------------- --- --- --- ---
Net income
attributable to
common shares $129 $148 $529 $586
---------------- ---- ---- ---- ----
Earnings per common share:
Basic $0.73 $0.83 $3.01 $3.28
Diluted 0.71 0.80 2.92 3.16
Comprehensive income 45 54 518 572
Cash dividends
declared on common
stock 37 36 147 143
Cash dividends
declared per common
share 0.21 0.20 0.83 0.79
-------------------- ---- ---- ---- ----
CONSOLIDATED QUARTERLY STATEMENTS OF COMPREHENSIVE INCOME (unaudited)
Comerica Incorporated and Subsidiaries
Fourth Third Second First Fourth Fourth Quarter 2015 Compared To:
Quarter Quarter Quarter Quarter Quarter Third Quarter 2015 Fourth Quarter 2014
(in millions, except
per share data) 2015 2015 2015 2015 2014 Amount Percent Amount Percent
-------------------- ---- ---- ---- ---- ---- ------ ------- ------ -------
INTEREST INCOME
Interest and fees on
loans $395 $390 $388 $378 $383 $5 1% $12 3%
Interest on investment
securities 56 54 53 53 51 2 6 5 12
Interest on short-
term investments 6 4 3 4 4 2 19 2 8
------------------ --- --- --- --- --- --- --- --- ---
Total interest income 457 448 444 435 438 9 2 19 4
INTEREST EXPENSE
Interest on deposits 10 11 11 11 12 (1) (3) (2) (7)
Interest on medium-
and long-term debt 14 15 12 11 11 (1) (6) 3 21
------------------- --- --- --- --- --- --- --- --- ---
Total interest expense 24 26 23 22 23 (2) (4) 1 7
---------------------- --- --- --- --- --- --- --- --- ---
Net interest income 433 422 421 413 415 $11 3 $18 4
Provision for credit
losses 35 26 47 14 2 9 32 33 N/M
-------------------- --- --- --- --- --- --- --- --- ---
Net interest income
after provision for
credit losses 398 396 374 399 413 2 1 (15) (4)
NONINTEREST INCOME
Card fees 77 74 72 67 24 3 3 53 N/M
Service charges on
deposit accounts 55 57 56 55 53 (2) (3) 2 4
Fiduciary income 45 47 48 47 47 (2) (4) (2) (4)
Commercial lending
fees 30 22 22 25 29 8 35 1 5
Letter of credit fees 14 13 13 13 14 1 2 - -
Bank-owned life
insurance 11 10 10 9 8 1 1 3 18
Foreign exchange
income 11 10 9 10 10 1 5 1 11
Brokerage fees 4 5 4 4 4 (1) (12) - -
Net securities losses - - - (2) - - N/M - -
Other noninterest
income 23 26 27 27 36 (3) (7) (13) (33)
----------------- --- --- --- --- --- --- --- --- ---
Total noninterest
income 270 264 261 255 225 6 2 45 20
NONINTEREST EXPENSES
Salaries and benefits
expense 265 243 251 253 245 22 9 20 8
Outside processing fee
expense 83 86 86 77 33 (3) (5) 50 N/M
Net occupancy expense 41 41 39 38 46 - - (5) (10)
Equipment expense 14 13 13 13 14 1 1 - -
Software expense 26 26 24 23 23 - - 3 9
FDIC insurance expense 10 9 9 9 8 1 24 2 31
Advertising expense 7 6 5 6 7 1 13 - -
Litigation-related
expense - (3) (30) 1 - 3 N/M - -
Other noninterest
expenses 43 40 39 39 43 3 8 - -
----------------- --- --- --- --- --- --- --- --- ---
Total noninterest
expenses 489 461 436 459 419 28 6 70 17
----------------- --- --- --- --- --- --- --- --- ---
Income before income
taxes 179 199 199 195 219 (20) (10) (40) (19)
Provision for income
taxes 49 63 64 61 70 (14) (22) (21) (30)
-------------------- --- --- --- --- --- --- --- --- ---
NET INCOME 130 136 135 134 149 (6) (5) (19) (13)
Less income allocated
to participating
securities 1 2 1 2 1 (1) (3) - -
--------------------- --- --- --- --- --- --- --- --- ---
Net income
attributable to
common shares $129 $134 $134 $132 $148 $(5) (5)% $(19) (13)%
---------------- ---- ---- ---- ---- ---- --- --- ---- ----
Earnings per common share:
Basic $0.73 $0.76 $0.76 $0.75 $0.83 $(0.03) (4)% $(0.10) (12)%
Diluted 0.71 0.74 0.73 0.73 0.80 (0.03) (4) (0.09) (11)
Comprehensive income 45 187 109 176 54 (142) (76) (9) (18)
Cash dividends
declared on common
stock 37 37 37 36 36 - - 1 3
Cash dividends
declared per common
share 0.21 0.21 0.21 0.20 0.20 - - 0.01 5
-------------------- ---- ---- ---- ---- ---- --- --- ---- ---
N/M - not meaningful
ANALYSIS OF THE ALLOWANCE FOR LOAN LOSSES (unaudited)
Comerica Incorporated and Subsidiaries
2015 2014
---- ----
(in millions) 4th Qtr 3rd Qtr 2nd Qtr 1st Qtr 4th Qtr
------------ ------- ------- ------- ------- -------
Balance at beginning of
period $622 $618 $601 $594 $592
Loan charge-offs:
Commercial 48 30 17 19 8
Commercial mortgage 1 - 2 - 2
Lease financing - - 1 - -
International - 1 11 2 6
Residential mortgage - - 1 - 1
Consumer 2 3 3 2 3
-------- --- --- --- --- ---
Total loan charge-offs 51 34 35 23 20
Recoveries on loans previously charged-
off:
Commercial 6 8 10 9 6
Real estate construction - - 1 - 2
Commercial mortgage 11 2 5 3 10
Residential mortgage 1 - - 1 -
Consumer 7 1 1 2 1
-------- --- --- --- --- ---
Total recoveries 25 11 17 15 19
---------------- --- --- --- --- ---
Net loan charge-offs 26 23 18 8 1
Provision for loan losses 38 28 35 16 4
Foreign currency
translation adjustment - (1) - (1) (1)
----------------------- --- --- --- --- ---
Balance at end of period $634 $622 $618 $601 $594
------------------------ ---- ---- ---- ---- ----
Allowance for loan losses
as a percentage of total
loans 1.29% 1.27% 1.24% 1.22% 1.22%
Net loan charge-offs as
a percentage of average
total loans 0.21 0.19 0.15 0.07 0.01
------------------------ ---- ---- ---- ---- ----
ANALYSIS OF THE ALLOWANCE FOR CREDIT LOSSES ON LENDING-RELATED COMMITMENTS (unaudited)
Comerica Incorporated and Subsidiaries
2015 2014
---- ----
(in millions) 4th Qtr 3rd Qtr 2nd Qtr 1st Qtr 4th Qtr
------------ ------- ------- ------- ------- -------
Balance at
beginning of
period $48 $50 $39 $41 $43
Less: Charge-
offs on lending-
related
commitments (a) - - 1 - -
Add: Provision
for credit
losses on
lending-related
commitments (3) (2) 12 (2) (2)
---------------- --- --- --- --- ---
Balance at end of
period $45 $48 $50 $39 $41
----------------- --- --- --- --- ---
Unfunded lending-
related
commitments sold $ - $ - $12 $1 $ -
----------------- --- --- --- --- --- --- --- ---
(a) Charge-offs result from the sale
of unfunded lending-related
commitments.
NONPERFORMING ASSETS (unaudited)
Comerica Incorporated and Subsidiaries
2015 2014
---- ----
(in millions) 4th Qtr 3rd Qtr 2nd Qtr 1st Qtr 4th Qtr
------------ ------- ------- ------- ------- -------
SUMMARY OF NONPERFORMING ASSETS AND PAST DUE LOANS
Nonaccrual loans:
Business loans:
Commercial $238 $214 $186 $113 $109
Real estate construction 1 1 1 1 2
Commercial mortgage 60 66 77 82 95
Lease financing 6 8 11 - -
International 8 8 9 1 -
--- --- --- --- ---
Total nonaccrual business
loans 313 297 284 197 206
Retail loans:
Residential mortgage 27 31 35 37 36
Consumer:
Home equity 27 28 29 31 30
Other consumer - 1 1 1 1
-------------- --- --- --- --- ---
Total consumer 27 29 30 32 31
-------------- --- --- --- --- ---
Total nonaccrual retail
loans 54 60 65 69 67
----------------------- --- --- --- --- ---
Total nonaccrual loans 367 357 349 266 273
Reduced-rate loans 12 12 12 13 17
------------------ --- --- --- --- ---
Total nonperforming loans
(a) 379 369 361 279 290
Foreclosed property 12 12 9 9 10
------------------- --- --- --- --- ---
Total nonperforming assets
(a) $391 $381 $370 $288 $300
-------------------------- ---- ---- ---- ---- ----
Nonperforming loans as a
percentage of total loans 0.77% 0.75% 0.72% 0.57% 0.60%
Nonperforming assets as a
percentage of total loans
and foreclosed property 0.80 0.78 0.74 0.59 0.62
Allowance for loan losses as
a percentage of total
nonperforming loans 167 169 171 216 205
Loans past due 90 days or
more and still accruing $17 $5 $18 $12 $5
------------------------- --- --- --- --- ---
ANALYSIS OF NONACCRUAL LOANS
Nonaccrual loans at
beginning of period $357 $349 $266 $273 $329
Loans transferred to
nonaccrual (b) 105 69 145 39 41
Nonaccrual business loan
gross charge-offs (c) (49) (31) (31) (21) (16)
Loans transferred to accrual
status (b) - - - (4) (18)
Nonaccrual business loans
sold (d) - - (1) (2) (24)
Payments/Other (e) (46) (30) (30) (19) (39)
------------------ --- --- --- --- ---
Nonaccrual loans at end of
period $367 $357 $349 $266 $273
-------------------------- ---- ---- ---- ---- ----
(a) Excludes loans acquired with credit impairment.
(b) Based on an analysis of nonaccrual loans with book balances greater than $2 million.
(c) Analysis of gross loan charge-offs:
Nonaccrual business loans $49 $31 $31 $21 $16
Consumer and residential
mortgage loans 2 3 4 2 4
--- --- --- --- ---
Total gross loan charge-
offs $51 $34 $35 $23 $20
--- --- --- --- ---
(d) Analysis of loans sold:
Nonaccrual business loans $ - $ - $1 $2 $24
Performing criticized loans 3 - - 7 5
--- --- --- --- ---
Total criticized loans sold $3 $ - $1 $9 $29
--- --- --- --- --- ---
(e) Includes net changes related to nonaccrual loans with balances less than $2 million, payments on nonaccrual loans with book balances greater than $2 million and transfers of nonaccrual loans to foreclosed property.
Excludes business loan gross charge-offs and business nonaccrual loans sold.
ANALYSIS OF NET INTEREST INCOME (FTE) (unaudited)
Comerica Incorporated and Subsidiaries
Years Ended
-----------
December 31, 2015 December 31, 2014
----------------- -----------------
Average Average Average Average
(dollar amounts in
millions) Balance Interest Rate Balance Interest Rate
------------------ ------- -------- ---- ------- -------- ----
Commercial loans $31,501 $966 3.07% $29,715 $927 3.12%
Real estate construction
loans 1,884 66 3.48 1,909 65 3.41
Commercial mortgage
loans 8,697 296 3.41 8,706 327 3.75
Lease financing 783 25 3.17 834 19 2.33
International loans 1,441 51 3.58 1,376 50 3.65
Residential mortgage
loans 1,878 71 3.77 1,778 68 3.82
Consumer loans 2,444 80 3.26 2,270 73 3.20
-------------- ----- --- ---- ----- --- ----
Total loans (a) 48,628 1,555 3.20 46,588 1,529 3.28
Mortgage-backed
securities (b) 9,113 202 2.24 8,970 209 2.33
Other investment
securities 1,124 14 1.25 380 2 0.45
---------------- ----- --- ---- --- --- ----
Total investment
securities (b) 10,237 216 2.13 9,350 211 2.26
Interest-bearing
deposits with banks 6,158 16 0.26 5,513 14 0.26
Other short-term
investments 106 1 0.81 109 - 0.57
---------------- --- --- ---- --- --- ----
Total earning assets 65,129 1,788 2.75 61,560 1,754 2.85
Cash and due from banks 1,059 934
Allowance for loan
losses (621) (601)
Accrued income and other
assets 4,680 4,443
----- -----
Total assets $70,247 $66,336
------- -------
Money market and
interest-bearing
checking deposits $24,073 26 0.11 $22,891 24 0.11
Savings deposits 1,841 - 0.02 1,744 1 0.03
Customer certificates of
deposit 4,209 16 0.37 4,869 18 0.36
Foreign office time
deposits 116 1 1.02 261 2 0.82
------------------- --- --- ---- --- --- ----
Total interest-bearing
deposits 30,239 43 0.14 29,765 45 0.15
Short-term borrowings 93 - 0.05 200 - 0.04
Medium- and long-term
debt 2,905 52 1.80 2,963 50 1.68
--------------------- ----- --- ---- ----- --- ----
Total interest-bearing
sources 33,237 95 0.29 32,928 95 0.29
Noninterest-bearing
deposits 28,087 25,019
Accrued expenses and
other liabilities 1,389 1,016
Total shareholders'
equity 7,534 7,373
----- -----
Total liabilities and
shareholders' equity $70,247 $66,336
------- -------
Net interest income/rate spread (FTE) $1,693 2.46 $1,659 2.56
------ ------
FTE adjustment $4 $4
Impact of net noninterest-bearing
sources of funds 0.14 0.14
--------------------------------- ---- ----
Net interest margin (as a percentage of
average earning assets) (FTE) (a) 2.60% 2.70%
--------------------------------------- ---- ----
(a) Accretion of the purchase
discount on the acquired loan
portfolio of $7 million and $34
million in the years ended
December 31, 2015 and 2014,
respectively, increased the net
interest margin by 1 basis
point and 6 basis points in
each respective period.
(b) Includes investment securities
available-for-sale and
investment securities held-to-
maturity.
ANALYSIS OF NET INTEREST INCOME (FTE) (unaudited)
Comerica Incorporated and Subsidiaries
Three Months Ended
------------------
December 31, 2015 September 30, 2015 December 31, 2014
----------------- ------------------ -----------------
Average Average Average Average Average Average
(dollar amounts in
millions) Balance Interest Rate Balance Interest Rate Balance Interest Rate
------------------ ------- -------- ---- ------- -------- ---- ------- -------- ----
Commercial loans $31,219 $245 3.11% $31,900 $244 3.04% $30,391 $238 3.11%
Real estate construction
loans 1,961 18 3.58 1,833 16 3.47 1,920 16 3.40
Commercial mortgage
loans 8,842 76 3.43 8,691 74 3.39 8,609 81 3.70
Lease financing 750 6 3.29 788 6 3.16 818 (1) (0.43)
International loans 1,402 12 3.40 1,401 13 3.51 1,455 13 3.68
Residential mortgage
loans 1,896 18 3.75 1,882 18 3.79 1,821 18 3.86
Consumer loans 2,478 21 3.38 2,477 20 3.21 2,347 19 3.20
-------------- ----- --- ---- ----- --- ---- ----- --- ----
Total loans (a) 48,548 396 3.24 48,972 391 3.17 47,361 384 3.22
Mortgage-backed
securities (b) 9,226 51 2.25 9,099 50 2.21 8,954 50 2.27
Other investment
securities 1,638 5 1.37 1,133 4 1.26 411 1 0.49
---------------- ----- --- ---- ----- --- ---- --- --- ----
Total investment
securities (b) 10,864 56 2.11 10,232 54 2.11 9,365 51 2.19
Interest-bearing
deposits with banks 7,300 5 0.28 6,869 4 0.25 7,622 4 0.26
Other short-term
investments 106 1 0.91 118 - 0.82 105 - 0.48
---------------- --- --- ---- --- --- ---- --- --- ----
Total earning assets 66,818 458 2.73 66,191 449 2.70 64,453 439 2.71
Cash and due from banks 1,071 1,095 937
Allowance for loan
losses (641) (628) (597)
Accrued income and other
assets 4,659 4,675 4,514
----- ----- -----
Total assets $71,907 $71,333 $69,307
------- ------- -------
Money market and
interest-bearing
checking deposits $24,368 6 0.11 $24,298 7 0.11 $23,841 7 0.11
Savings deposits 1,883 - 0.02 1,860 - 0.02 1,771 - 0.03
Customer certificates of
deposit 3,763 4 0.39 4,232 4 0.37 4,510 4 0.37
Foreign office time
deposits 95 - 0.59 127 - 0.70 134 1 1.74
------------------- --- --- ---- --- --- ---- --- --- ----
Total interest-bearing
deposits 30,109 10 0.14 30,517 11 0.14 30,256 12 0.15
Short-term borrowings 92 - 0.06 91 - 0.04 172 - 0.04
Medium- and long-term
debt 3,089 14 1.79 3,175 15 1.85 2,674 11 1.72
--------------------- ----- --- ---- ----- --- ---- ----- --- ----
Total interest-bearing
sources 33,290 24 0.29 33,783 26 0.30 33,102 23 0.27
Noninterest-bearing
deposits 29,627 28,623 27,504
Accrued expenses and
other liabilities 1,377 1,368 1,183
Total shareholders'
equity 7,613 7,559 7,518
----- ----- -----
Total liabilities and
shareholders' equity $71,907 $71,333 $69,307
------- ------- -------
Net interest income/rate spread (FTE) $434 2.44 $423 2.40 $416 2.44
---- ---- ----
FTE adjustment $1 $1 $1
Impact of net noninterest-bearing
sources of funds 0.14 0.14 0.13
--------------------------------- ---- ---- ----
Net interest margin (as a percentage of
average earning assets) (FTE) (a) 2.58% 2.54% 2.57%
--------------------------------------- ---- ---- ----
(a) Accretion of the purchase
discount on the acquired loan
portfolio of $1 million, $2
million and $9 million in the
fourth quarter 2015, the third
quarter 2015 and the fourth
quarter 2014, respectively,
increased the net interest
margin by 1 basis point, 1
basis point and 5 basis points
in each respective period.
(b) Includes investment securities
available-for-sale and
investment securities held-to-
maturity.
CONSOLIDATED STATISTICAL DATA (unaudited)
Comerica Incorporated and Subsidiaries
December 31, September 30, June 30, March 31, December 31,
(in millions, except per
share data) 2015 2015 2015 2015 2014
------------------------ ---- ---- ---- ---- ----
Commercial loans:
Floor plan $3,939 $3,538 $3,840 $3,544 $3,790
Other 27,745 28,239 28,883 28,547 27,730
----- ------ ------ ------ ------ ------
Total commercial loans 31,684 31,777 32,723 32,091 31,520
Real estate construction
loans 2,001 1,874 1,795 1,917 1,955
Commercial mortgage loans 8,977 8,787 8,674 8,558 8,604
Lease financing 724 751 786 792 805
International loans 1,368 1,382 1,420 1,433 1,496
Residential mortgage
loans 1,870 1,880 1,865 1,859 1,831
Consumer loans:
Home equity 1,720 1,714 1,682 1,678 1,658
Other consumer 765 777 796 744 724
-------------- --- --- --- --- ---
Total consumer loans 2,485 2,491 2,478 2,422 2,382
-------------------- ----- ----- ----- ----- -----
Total loans $49,109 $48,942 $49,741 $49,072 $48,593
----------- ------- ------- ------- ------- -------
Goodwill $635 $635 $635 $635 $635
Core deposit intangible 10 10 11 12 13
Other intangibles 4 4 4 3 2
Common equity tier 1
capital (a) (b) 7,364 7,327 7,280 7,230 n/a
Tier 1 common capital (c) n/a n/a n/a n/a 7,169
Risk-weighted assets (a)
(b) 69,919 69,718 69,967 69,514 68,273
Common equity tier 1
risk-based capital
ratio (a) (b) 10.53% 10.51% 10.40% 10.40% n/a
Tier 1 common risk-based
capital ratio (c) n/a n/a n/a n/a 10.50%
Tier 1 risk-based
capital ratio (a) (b) 10.53 10.51 10.40 10.40 10.50
Total risk-based capital
ratio (a) (b) 12.68 12.82 12.38 12.35 12.51
Leverage ratio (a) (b) 10.24 10.28 10.56 10.53 10.35
Tangible common equity
ratio (c) 9.72 9.91 9.92 9.97 9.85
Common shareholders'
equity per share of
common stock $43.11 $43.02 $42.18 $42.12 $41.35
Tangible common equity
per share of common
stock (c) 39.41 39.36 38.53 38.47 37.72
Market value per share for the quarter:
High 47.44 52.93 53.45 47.94 50.14
Low 39.52 40.01 44.38 40.09 42.73
Close 41.83 41.10 51.32 45.13 46.84
Quarterly ratios:
Return on average common
shareholders' equity 6.81% 7.19% 7.21% 7.20% 7.96%
Return on average assets 0.72 0.76 0.79 0.78 0.86
Efficiency ratio (d) 69.53 67.08 63.68 68.50 65.26
Number of banking centers 477 477 477 482 481
Number of employees -
full time equivalent 8,880 8,941 8,901 8,831 8,876
--------------------- ----- ----- ----- ----- -----
(a) Basel III
rules became
effective
January 1,
2015, with
transitional
provisions.
All prior
period data
is based on
Basel I
rules.
(b) December 31, 2015 amounts and
ratios are estimated.
(c) See Reconciliation of Non-GAAP
Financial Measures.
(d) Noninterest expenses as a
percentage of the sum of net
interest income (FTE) and
noninterest income excluding net
securities gains (losses).
n/a - not applicable.
PARENT COMPANY ONLY BALANCE SHEETS (unaudited)
Comerica Incorporated
December 31, September 30, December 31,
(in millions, except share
data) 2015 2015 2014
-------------------------- ---- ---- ----
ASSETS
Cash and due from
subsidiary bank $4 $5 $ -
Short-term investments
with subsidiary bank 569 563 1,133
Other short-term
investments 89 89 94
Investment in subsidiaries,
principally banks 7,538 7,596 7,411
Premises and equipment 3 2 2
Other assets 137 138 138
------------ --- --- ---
Total assets $8,340 $8,393 $8,778
------------ ------ ------ ------
LIABILITIES AND SHAREHOLDERS' EQUITY
Medium- and long-term debt $608 $618 $1,208
Other liabilities 158 153 168
----------------- --- --- ---
Total liabilities 766 771 1,376
Common stock - $5 par value:
Authorized - 325,000,000 shares
Issued -228,164,824 shares 1,141 1,141 1,141
Capital surplus 2,173 2,165 2,188
Accumulated other
comprehensive loss (429) (345) (412)
Retained earnings 7,098 7,007 6,744
Less cost of common stock
in treasury -52,457,113
shares at 12/31/15;
51,010,418 shares at
9/30/15 and 49,146,225
shares at 12/31/14 (2,409) (2,346) (2,259)
------------------------- ------ ------ ------
Total shareholders' equity 7,574 7,622 7,402
-------------------------- ----- ----- -----
Total liabilities and
shareholders' equity $8,340 $8,393 $8,778
--------------------- ------ ------ ------
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, 2013 182.3 $1,141 $2,179 $(391) $6,318 $(2,097) $7,150
Net income - - - - 593 - 593
Other comprehensive
loss, net of tax - - - (21) - - (21)
Cash dividends
declared on common
stock ($0.79 per
share) - - - - (143) - (143)
Purchase of common
stock (5.4) - - - - (260) (260)
Net issuance of common
stock under employee
stock plans 2.1 - (27) - (24) 96 45
Share-based
compensation - - 38 - - - 38
Other - - (2) - - 2 -
--- --- --- --- --- --- ---
BALANCE AT DECEMBER
31, 2014 179.0 $1,141 $2,188 $(412) $6,744 $(2,259) $7,402
Net income - - - - 535 - 535
Other comprehensive
loss, net of tax - - - (17) - - (17)
Cash dividends
declared on common
stock ($0.83 per
share) - - - - (148) - (148)
Purchase of common
stock (5.3) - - - - (240) (240)
Purchase and
retirement of
warrants - - (10) - - - (10)
Net issuance of common
stock under employee
stock plans 1.0 - (22) - (11) 47 14
Net issuance of common
stock for warrants 1.0 - (21) - (22) 43 -
Share-based
compensation - - 38 - - - 38
BALANCE AT DECEMBER
31, 2015 175.7 $1,141 $2,173 $(429) $7,098 $(2,409) $7,574
------------------- ----- ------ ------ ----- ------ ------- ------
BUSINESS SEGMENT FINANCIAL RESULTS (unaudited)
Comerica Incorporated and Subsidiaries
(dollar amounts
in millions) Business Retail Wealth
Three Months
Ended December
31, 2015 Bank Bank Management Finance Other Total
--------------- ---- ---- ---------- ------- ----- -----
Earnings summary:
Net interest
income (expense)
(FTE) $387 $160 $47 $(162) $2 $434
Provision for
credit losses 41 (2) (7) - 3 35
Noninterest
income 147 49 57 15 2 270
Noninterest
expenses 210 192 81 2 4 489
Provision
(benefit) for
income taxes
(FTE) 84 5 9 (47) (1) 50
--- --- --- --- ---
Net income (loss) $199 $14 $21 $(102) $(2) $130
---- --- --- ----- --- ----
Net loan charge-
offs
(recoveries) $35 $ - $(9) $ - $ - $26
Selected average balances:
Assets $38,765 $6,549 $5,199 $12,678 $8,716 $71,907
Loans 37,682 5,868 4,998 - - 48,548
Deposits 31,738 23,262 4,355 120 261 59,736
Statistical data:
Return on average
assets (a) 2.05% 0.23% 1.65% N/M N/M 0.72%
Efficiency ratio
(b) 39.32 92.03 77.56 N/M N/M 69.53
---------------- ----- ----- ----- --- --- -----
Business Retail Wealth
Three Months
Ended September
30, 2015 Bank Bank Management Finance Other Total
---------------- ---- ---- ---------- ------- ----- -----
Earnings summary:
Net interest
income (expense)
(FTE) $380 $158 $45 $(162) $2 $423
Provision for
credit losses 30 2 (3) - (3) 26
Noninterest
income 145 49 59 15 (4) 264
Noninterest
expenses 202 185 74 2 (2) 461
Provision
(benefit) for
income taxes
(FTE) 99 7 12 (56) 2 64
--- --- --- --- ---
Net income (loss) $194 $13 $21 $(93) $1 $136
---- --- --- ---- --- ----
Net loan charge-
offs
(recoveries) $23 $1 $(1) $ - $ - $23
Selected average balances:
Assets $39,210 $6,518 $5,228 $12,177 $8,200 $71,333
Loans 38,113 5,835 5,024 - - 48,972
Deposits 31,397 23,079 4,188 212 264 59,140
Statistical data:
Return on average
assets (a) 1.98% 0.23% 1.62% N/M N/M 0.76%
Efficiency ratio
(b) 38.41 89.33 71.11 N/M N/M 67.08
---------------- ----- ----- ----- --- --- -----
Business Retail Wealth
Three Months
Ended December
31, 2014 Bank Bank Management Finance Other Total
--------------- ---- ---- ---------- ------- ----- -----
Earnings summary:
Net interest
income (expense)
(FTE) $387 $152 $47 $(177) 7 $416
Provision for
credit losses 8 (2) (9) - 5 2
Noninterest
income 104 45 60 16 - 225
Noninterest
expenses 148 182 80 3 6 419
Provision
(benefit) for
income taxes
(FTE) 119 6 14 (64) (4) 71
--- --- --- --- --- ---
Net income (loss) $216 $11 $22 $(100) $ - $149
---- --- --- ----- --- --- ----
Net loan charge-
offs
(recoveries) $(1) $4 $(2) $ - $ - $1
Selected average balances:
Assets $37,896 $6,298 $5,034 $12,218 $7,861 $69,307
Loans 36,890 5,626 4,845 - - 47,361
Deposits 30,897 22,301 4,094 195 273 57,760
Statistical data:
Return on average
assets (a) 2.28% 0.19% 1.79% N/M N/M 0.86%
Efficiency ratio
(b) 30.09 92.33 74.48 N/M N/M 65.26
---------------- ----- ----- ----- --- --- -----
(a) Return on average assets is
calculated based on the
greater of average assets or
average liabilities and
attributed equity.
(b) Noninterest expenses as a
percentage of the sum of net
interest income (FTE) and
noninterest income excluding
net securities gains.
FTE - Fully Taxable Equivalent
N/M - Not Meaningful
MARKET SEGMENT FINANCIAL RESULTS (unaudited)
Comerica Incorporated and Subsidiaries
(dollar amounts in millions) Other Finance
Three Months
Ended December
31, 2015 Michigan California Texas Markets & Other Total
--------------- -------- ---------- ----- ------- ------- -----
Earnings summary:
Net interest
income (expense)
(FTE) $183 $193 $131 $87 $(160) $434
Provision for
credit losses (12) (7) 57 (6) 3 35
Noninterest
income 82 41 32 98 17 270
Noninterest
expenses 162 108 104 109 6 489
Provision
(benefit) for
income taxes
(FTE) 32 43 6 17 (48) 50
--- --- --- --- --- ---
Net income (loss) $83 $90 $(4) $65 $(104) $130
--- --- --- --- ----- ----
Net loan charge-
offs $(2) $1 $33 $(6) $ - $26
Selected average balances:
Assets $13,601 $17,297 $11,474 $8,141 $21,394 $71,907
Loans 12,986 17,033 10,893 7,636 - 48,548
Deposits 22,123 18,545 10,807 7,880 381 59,736
Statistical data:
Return on average
assets (a) 1.43% 1.82% (0.11)% 3.07% N/M 0.72%
Efficiency ratio
(b) 61.26 46.43 63.28 58.79 N/M 69.53
---------------- ----- ----- ----- ----- --- -----
Other Finance
Three Months
Ended September
30, 2015 Michigan California Texas Markets & Other Total
---------------- -------- ---------- ----- ------- ------- -----
Earnings summary:
Net interest
income (expense)
(FTE) $180 $187 $129 $87 $(160) $423
Provision for
credit losses 6 24 10 (11) (3) 26
Noninterest
income 85 38 34 96 11 264
Noninterest
expenses 152 102 97 110 - 461
Provision
(benefit) for
income taxes
(FTE) 36 37 20 25 (54) 64
--- --- --- --- --- ---
Net income (loss) $71 $62 $36 $59 $(92) $136
--- --- --- --- ---- ----
Net loan charge-
offs
(recoveries) $9 $10 $4 $ - $ - $23
Selected average balances:
Assets $13,856 $17,060 $11,578 $8,462 $20,377 $71,333
Loans 13,223 16,789 10,997 7,963 - 48,972
Deposits 21,946 18,372 10,753 7,593 476 59,140
Statistical data:
Return on average
assets (a) 1.23% 1.27% 1.16% 2.82% N/M 0.76%
Efficiency ratio
(b) 57.49 45.28 59.54 59.86 N/M 67.08
---------------- ----- ----- ----- ----- --- -----
Other Finance
Three Months
Ended December
31, 2014 Michigan California Texas Markets & Other Total
--------------- -------- ---------- ----- ------- ------- -----
Earnings summary:
Net interest
income (expense)
(FTE) $173 $192 $139 $82 $(170) $416
Provision for
credit losses (19) (10) 18 8 5 2
Noninterest
income 89 37 38 45 16 225
Noninterest
expenses 157 100 95 58 9 419
Provision
(benefit) for
income taxes
(FTE) 45 55 24 15 (68) 71
--- --- --- --- --- ---
Net income (loss) $79 $84 $40 $46 $(100) $149
--- --- --- --- ----- ----
Net loan charge-
offs
(recoveries) $(5) $1 $2 $3 $ - $1
Selected average balances:
Assets $13,605 $16,035 $12,003 $7,585 $20,079 $69,307
Loans 13,142 15,777 11,327 7,115 - 47,361
Deposits 21,530 18,028 10,825 6,909 468 57,760
Statistical data:
Return on average
assets (a) 1.41% 1.77% 1.32% 2.42% N/M 0.86%
Efficiency ratio
(b) 59.92 43.61 53.62 45.47 N/M 65.26
---------------- ----- ----- ----- ----- --- -----
(a) Return on average assets is
calculated based on the
greater of average assets or
average liabilities and
attributed equity.
(b) Noninterest expenses as a
percentage of the sum of net
interest income (FTE) and
noninterest income excluding
net securities gains.
FTE - Fully Taxable Equivalent
N/M - Not Meaningful
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) 2015 2015 2015 2015 2014
------------------ ---- ---- ---- ---- ----
Tier 1 Common Capital Ratio:
Tier 1 and Tier 1
common capital (a) n/a n/a n/a n/a $7,169
Risk-weighted
assets (a) n/a n/a n/a n/a 68,269
------------- --- --- --- --- ------
Tier 1 and Tier 1
common risk-based
capital ratio n/a n/a n/a n/a 10.50%
------------------ --- --- --- --- -----
Tangible Common Equity Ratio:
Common
shareholders'
equity $7,574 $7,622 $7,523 $7,500 $7,402
Less:
Goodwill 635 635 635 635 635
Other intangible
assets 14 14 15 15 15
--- --- --- --- ---
Tangible common
equity $6,925 $6,973 $6,873 $6,850 $6,752
--------------- ------ ------ ------ ------ ------
Total assets $71,895 $71,012 $69,945 $69,333 $69,186
Less:
Goodwill 635 635 635 635 635
Other intangible
assets 14 14 15 15 15
--- --- --- --- ---
Tangible assets $71,246 $70,363 $69,295 $68,683 $68,536
--------------- ------- ------- ------- ------- -------
Common equity ratio 10.54% 10.73% 10.76% 10.82% 10.70%
Tangible common
equity ratio 9.72 9.91 9.92 9.97 9.85
--------------- ---- ---- ---- ---- ----
Tangible Common Equity per Share of
Common Stock:
Common
shareholders'
equity $7,574 $7,622 $7,523 $7,500 $7,402
Tangible common
equity 6,925 6,973 6,873 6,850 6,752
--------------- ----- ----- ----- ----- -----
Shares of common
stock outstanding
(in millions) 176 177 178 178 179
------------------ --- --- --- --- ---
Common
shareholders'
equity per share
of common stock $43.11 $43.02 $42.18 $42.12 $41.35
Tangible common
equity per share
of common stock 39.41 39.36 38.53 38.47 37.72
----------------- ----- ----- ----- ----- -----
(a) Tier 1 capital and risk-
weighted assets as
defined by Basel I risk-
based capital rules.
n/a - not applicable.
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 Basel I risk-based capital rules in effect through December 31, 2014. Effective January 1, 2015, regulatory capital components and risk-weighted assets are defined by and calculated in conformity with Basel III risk-based capital rules. 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.
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SOURCE Comerica Incorporated
