DALLAS, Feb. 16, 2016 /PRNewswire/ -- Comerica Incorporated (NYSE: CMA) today announced that it is adjusting its fourth quarter and full year 2015 financial results, from those reported on January 19, 2016, as a result of recently discovered irregularities with a single customer loan relationship in the Retail Bank. Following the discovery, Comerica increased its provision for credit losses, recorded a charge-off for the amount in question, and decreased incentive compensation expense based on the revised results, effective as of December 31, 2015.
Comerica had approximately $26 million outstanding from an Arizona-based sales and appraisal company at December 31, 2015. Following an extensive analysis of the situation, Comerica has determined that there was significant doubt as to collectibility of the loan and, given the unique irregularities, it is believed to be an isolated incident.
Comerica Chairman and Chief Executive Officer Ralph W. Babb, Jr. said, "Our investigation is ongoing and we are assessing all circumstances surrounding this matter. We remain confident in our systems and processes and will vigorously prosecute all legal options available to us to recover on this isolated loss."
The adjustments will reduce Comerica's 2015 net income by $14 million after-tax, or 8 cents per share, from $535 million, or $2.92 per share, to $521 million, or $2.84 per share. Adjusted fourth quarter 2015 net income was $116 million, or 64 cents per share, compared to previously reported net income of $130 million, or 71 cents per share.
The following table summarizes the impact of the adjustments on the previously reported financial results.
December 31, 2015
-----------------
Quarter Ended Year Ended
------------- ----------
(dollar amounts in
millions, except
per share data) As Reported As Adjusted As Reported As Adjusted
------------------ ----------- ----------- ----------- -----------
Provision for
credit losses $35 $60 $122 $147
Noninterest
expenses 489 486 1,845 1,842
Salaries and
benefits expense 265 262 1,012 1,009
Income before
income taxes 179 157 772 750
Provision for
income taxes 49 41 237 229
Net income 130 116 535 521
Net income
attributable to
common shares 129 115 529 515
Diluted income per
common share 0.71 0.64 2.92 2.84
Total shareholders'
equity at year end 7,574 7,560
Basel III common
equity Tier 1
capital ratio 10.53% (a) 10.54%
Tangible common
equity ratio (b) 9.72% 9.70%
----------------- ---- ----
(a) Estimated as of January 19,2016.
Prior to the adjustments, the final
Basel III common equity Tier 1 ratio
would have been 10.56%.
(b) See Reconciliation of Non-GAAP
Financial Measures.
Comerica's Annual Report on Form 10-K will reflect these adjustments when it is filed with the U.S. Securities and Exchange Commission. The revisions primarily impacted the Retail Bank and Other Markets. Revised fourth quarter and full year 2015 financial information is included with this release.
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 $0.64 $0.74 $0.80 $2.84 $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 6.08% 7.19% 7.96% 6.91% 8.05%
Return on average
assets 0.64 0.76 0.86 0.74 0.89
Common equity tier 1
risk-based capital
ratio (a) 10.54 10.51 n/a
Tier 1 common risk-
based capital ratio
(b) n/a n/a 10.50
Tier 1 risk-based
capital ratio (a) 10.54 10.51 10.50
Total risk-based
capital ratio (a) 12.69 12.82 12.51
Leverage ratio (a) 10.22 10.28 10.35
Tangible common
equity ratio (b) 9.70 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 51 23 1 $100 $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 0.42 0.19 0.01 0.21% 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
-------------------- --- --- ---
Basel III rules became effective
on January 1, 2015, with
transitional provisions. All
prior period data is based on
(a) Basel I rules.
(b) 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 31,659 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 49,084 48,942 48,593
Less allowance for loan losses (634) (622) (594)
------------------------------ ---- ---- ----
Net loans 48,450 48,320 47,999
Premises and equipment 550 541 532
Accrued income and other assets 4,117 4,232 4,434
------------------------------- ----- ----- -----
Total assets $71,877 $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 1,383 1,413 1,507
Medium- and long-term debt 3,058 3,100 2,675
-------------------------- ----- ----- -----
Total liabilities 64,317 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 7,084 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 7,560 7,622 7,402
-------------------------- ----- ----- -----
Total liabilities and shareholders'
equity $71,877 $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 60 2 147 27
-------------------- --- --- --- ---
Net interest income
after provision for
credit losses 373 413 1,542 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 262 245 1,009 980
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 486 419 1,842 1,626
----------------- --- --- ----- -----
Income before income
taxes 157 219 750 870
Provision for income
taxes 41 70 229 277
-------------------- --- --- --- ---
NET INCOME 116 149 521 593
Less income allocated
to participating
securities 1 1 6 7
--------------------- --- --- --- ---
Net income
attributable to
common shares $115 $148 $515 $586
---------------- ---- ---- ---- ----
Earnings per common
share:
Basic $0.65 $0.83 $2.93 $3.28
Diluted 0.64 0.80 2.84 3.16
Comprehensive income 31 54 504 572
Cash dividends
declared on common
stock 37 36 148 143
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 60 26 47 14 2 34 N/M 58 N/M
-------------------- --- --- --- --- --- --- --- --- ---
Net interest income
after provision 373 396 374 399 413 (23) (6) (40) (10)
for credit losses
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 262 243 251 253 245 19 8 17 7
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 486 461 436 459 419 25 5 67 16
----------------- --- --- --- --- --- --- --- --- ---
Income before income
taxes 157 199 199 195 219 (42) (21) (62) (29)
Provision for income
taxes 41 63 64 61 70 (22) (35) (29) (41)
-------------------- --- --- --- --- --- --- --- --- ---
NET INCOME 116 136 135 134 149 (20) (15) (33) (23)
Less income allocated
to participating
securities 1 2 1 2 1 (1) (14) - -
--------------------- --- --- --- --- --- --- --- --- ---
Net income
attributable to
common shares $115 $134 $134 $132 $148 $(19) (15)% $(33) (23)%
---------------- ---- ---- ---- ---- ---- ---- ---- ---- ----
Earnings per common share:
Basic $0.65 $0.76 $0.76 $0.75 $0.83 $(0.11) (14)% $(0.18) (22)%
Diluted 0.64 0.74 0.73 0.73 0.80 (0.10) (14) (0.16) (20)
Comprehensive income 31 187 109 176 54 (156) (83) (23) (43)
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 73 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 76 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 51 23 18 8 1
Provision for loan losses 63 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 0.42 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.
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 27,720 28,239 28,883 28,547 27,730
----- ------ ------ ------ ------ ------
Total commercial loans 31,659 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 $49,084 $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) 7,350 7,327 7,280 7,230 n/a
Tier 1 common capital (b) n/a n/a n/a n/a 7,169
Risk-weighted assets (a) 69,731 69,718 69,967 69,514 68,273
Common equity tier 1
risk-based capital
ratio (a) 10.54% 10.51% 10.40% 10.40% n/a
Tier 1 common risk-based
capital ratio (b) n/a n/a n/a n/a 10.50%
Tier 1 risk-based
capital ratio (a) 10.54 10.51 10.40 10.40 10.50
Total risk-based capital
ratio (a) 12.69 12.82 12.38 12.35 12.51
Leverage ratio (a) 10.22 10.28 10.56 10.53 10.35
Tangible common equity
ratio (b) 9.70 9.91 9.92 9.97 9.85
Common shareholders'
equity per share of
common stock $43.03 $43.02 $42.18 $42.12 $41.35
Tangible common equity
per share of common
stock (b) 39.33 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 6.08% 7.19% 7.21% 7.20% 7.96%
Return on average assets 0.64 0.76 0.79 0.78 0.86
Efficiency ratio (c) 69.11 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
--------------------- ----- ----- ----- ----- -----
Basel III rules became effective
January 1, 2015, with
transitional provisions. All
prior period data is based on
(a) Basel I rules.
(b) 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
(c) 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 7,523 7,596 7,411
Premises and equipment 3 2 2
Other assets 137 138 138
------------ --- --- ---
Total assets $8,325 $8,393 $8,778
------------ ------ ------ ------
LIABILITIES AND
SHAREHOLDERS' EQUITY
Medium- and long-term debt $608 $618 $1,208
Other liabilities 157 153 168
----------------- --- --- ---
Total liabilities 765 771 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 7,084 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 7,560 7,622 7,402
-------------------------- ----- ----- -----
Total liabilities and
shareholders' equity $8,325 $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 - - - - 521 - 521
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) $7,084 $(2,409) $7,560
------------------- ----- ------ ------ ----- ------ ------- ------
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 23 (7) - 3 60
Noninterest income 147 49 57 15 2 270
Noninterest
expenses 208 191 81 2 4 486
Provision (benefit)
for income taxes
(FTE) 85 (4) 9 (47) (1) 42
--- --- --- --- ---
Net income (loss) $200 $(1) $21 $(102) $(2) $116
---- --- --- ----- --- ----
Net loan charge-
offs (recoveries) $35 $25 $(9) $ - $ - $51
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) 2.06% (0.03)% 1.68% N/M N/M 0.64%
Efficiency ratio
(b) 39.00 91.69 77.02 N/M N/M 69.11
----- ----- ----- --- --- -----
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 19 3 60
Noninterest
income 82 41 32 98 17 270
Noninterest
expenses 161 108 103 108 6 486
Provision
(benefit) for
income taxes
(FTE) 33 43 6 8 (48) 42
--- --- --- --- --- ---
Net income (loss) $83 $90 $(3) $50 $(104) $116
--- --- --- --- ----- ----
Net loan charge-
offs $(2) $1 $33 $19 $ - $51
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% 1.83% (0.10)% 2.36% N/M 0.64%
Efficiency ratio
(b) 61.06 46.17 62.94 58.11 N/M 69.11
---------------- ----- ----- ----- ----- --- -----
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 $7,560 $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 $6,911 $6,973 $6,873 $6,850 $6,752
--------------- ------ ------ ------ ------ ------
Total assets $71,877 $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 $71,228 $70,363 $69,295 $68,683 $68,536
--------------- ------- ------- ------- ------- -------
Common equity ratio 10.52% 10.73% 10.76% 10.82% 10.70%
Tangible common
equity ratio 9.70 9.91 9.92 9.97 9.85
--------------- ---- ---- ---- ---- ----
Tangible Common
Equity per Share
of Common Stock:
Common
shareholders'
equity $7,560 $7,622 $7,523 $7,500 $7,402
Tangible common
equity 6,911 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 $43.03 $43.02 $42.18 $42.12 $41.35
Tangible common
equity per share
of common stock 39.33 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.
To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/comerica-adjusts-fourth-quarter-and-full-year-2015-results-300221002.html
SOURCE Comerica Incorporated
