Comerica (CMA) 8-K Comerica Reports Fourth Quarter 2016 Net Income of $164 Million

COMERICA REPORTS FOURTH QUARTER 2016 NET INCOME OF $164 MILLION

Net Income of 92 Cents Per Share Increased 10 Percent Compared to Third Quarter 2016

Includes After-Tax Impact of Restructuring Charges of $13 Million, or 7 Cents Per Share

Full-Year 2016 Net Income of $477 Million, or $2.68 Per Share

2016 Includes After-Tax Impact of Restructuring Charges of $59 Million, or 34 Cents Per Share

2016 Net Interest Income Increased $108 million, or 6 Percent, Compared to 2015

Reflects the Benefits of Rising Rates

Growth in Efficiency and Revenue Initiative Implementation Continues

Over $25 Million of Expense Savings Thus Far

DALLAS/January 17, 2017 -- Comerica Incorporated (NYSE: CMA) today reported full-year 2016 net income of $477 million, or $2.68 per diluted share (included restructuring impact of 34 cents per share), compared to $521 million, or $2.84 per diluted share for full-year 2015. Fourth quarter 2016 net income was $164 million, compared to $149 million for the third quarter 2016 and $116 million for the fourth quarter 2015.

The Growth in Efficiency and Revenue ("GEAR Up") initiative continues to execute on the more than 20 work streams previously identified. 2016 progress includes a reduction in workforce, the consolidation of 19 banking centers and a significant reduction in retirement plan expense.

(dollar amounts in millions, except per share data)	4th Qtr '16				3rd Qtr '16				4th Qtr '15
Net interest income	$	455			$	450			$	433
Provision for credit losses	35				16				60
Noninterest income	267				272				266
Noninterest expenses	461			(a)	493			(a)	482
Pre-tax income	226				213				157
Provision for income taxes	62				64				41
Net income	$	164			$	149			$	116
Net income attributable to common shares	$	163			$	148			$	115
Diluted income per common share	0.92				0.84				0.64
Average diluted shares (in millions)	177			(b)	176				179
Common equity Tier 1 capital ratio (c)	11.07		%		10.69		%		10.54		%
Common equity ratio	10.68				10.42				10.52
Tangible common equity ratio (d)	9.89				9.64				9.70
Efficiency ratio (e)	63.58				68.15				68.92

(a) Included restructuring charges of $20 million (7 cents per share, after tax) in both the fourth and third quarters of 2016.

(b) Included an increase of 1 million shares as a result of the impact of increased share price on common stock equivalents.

(c) December 31, 2016 ratio is estimated.

(d) See Reconciliation of Non-GAAP Financial Measures.

(e) Noninterest expenses as a percentage of the sum of net interest income (FTE) and noninterest income excluding net securities gains (losses).

"2016 was a pivotal year with the development and implementation of our enterprise-wide GEAR Up initiative,” said Ralph W. Babb, Jr., chairman and chief executive officer. “We have made significant progress in executing the expense savings and are fully committed to delivering on the efficiency and revenue opportunities to further enhance our profitability and shareholder value. We also benefited meaningfully from increased interest rates, and our overall credit metrics remained strong.

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COMERICA REPORTS FOURTH QUARTER 2016 NET INCOME OF $164 MILLION - 2

"Our fourth quarter earnings per share increased 10 percent over the third quarter," said Babb. "The benefits of GEAR Up were clearly demonstrated with a reduction in expenses and significant improvement in our efficiency ratio. In addition, the rise in rates late in the quarter boosted our net interest income. While average loan balances were relatively stable, reflecting seasonality in some of our businesses along with the continued reduction of our Energy portfolio, average deposit growth was robust, increasing $1.6 billion over the third quarter. Credit quality continued to be strong with net charge-offs at the low end of our historical norm. Finally, we increased our share buyback to $99 million, in line with our 2016 Capital Plan.

"As we look forward to the year ahead, we remain keenly focused on continued implementation of our GEAR Up initiatives while growing loans and deposits as we make necessary investments over time. Our revenue picture looks brighter as a result of the Federal Reserve increasing its benchmark rate 25 basis points in December. With oil prices stabilizing, we remain very comfortable with our Energy portfolio and the level of reserves we have established. We also believe we are well positioned to benefit from any further improvement in rates, and from favorable changes in the regulatory environment and the economy."

Fourth Quarter and Full-Year 2016 Overview

Fourth Quarter 2016 Compared to Third Quarter 2016

Average total loans decreased $291 million to $48.9 billion.

• Primarily reflected decreases in Mortgage Banker Finance, Energy, general Middle Market and Environmental Services, partially offset by an increase in National Dealer Services.

Average total deposits increased $1.6 billion, or 3 percent, to $59.6 billion.

• Driven by a $1.6 billion increase in noninterest-bearing deposits.

• Growth in average total deposits was broad-based with increases in almost all lines of business and all markets.

Net interest income increased $5 million to $455 million.

• Primarily reflecting the benefit of an increase in short-term rates and lower funding costs due to the maturity of $650 million of debt in the fourth quarter 2016.

Provision for credit losses increased $19 million to $35 million.

• Net credit-related charge-offs were $36 million, or 0.29 percent of average loans, compared to $16 million, or 0.13 percent, in the third quarter 2016.

• The allowance for loan losses was $730 million, or 1.49 percent of total loans.

Noninterest income decreased $5 million to $267 million.

• Decrease included lower commercial lending fees, largely as a result of a decrease in syndication fees.

Noninterest expenses decreased $32 million to $461 million.

• Decrease in salaries and benefits expense of $28 million, including an $8 million decrease in pension expense, primarily due to the GEAR Up initiative.

• Additional decrease due to lower consulting expense and a gain on early termination of certain leveraged lease transactions, partially offset by an increase in outside processing expense.

• Included restructuring charges of $20 million in both the fourth and third quarters of 2016.

Provision for income taxes decreased $2 million to $62 million.

• The effective tax rate was 27.5 percent for the fourth quarter 2016, compared to 29.6 percent in the third quarter, primarily reflecting a $5 million tax benefit from the early termination of certain leveraged lease transactions.

Capital position remained solid at December 31, 2016.

• Repurchased approximately 1.8 million shares of common stock under the equity repurchase program, which was more than offset by 5.1 million shares issued for warrant and employee option exercises.

• Including dividends, returned a total of $139 million to shareholders.

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COMERICA REPORTS FOURTH QUARTER 2016 NET INCOME OF $164 MILLION - 3

Full-Year 2016 Compared to Full-Year 2015

Average total loans increased $368 million, or 1 percent, to $49.0 billion.

• Excluding the $641 million decline in Energy, average loans increased $1.0 billion, primarily reflecting increases in Commercial Real Estate, National Dealer Services and Mortgage Banker Finance, partially offset by decreases in general Middle Market and Corporate Banking.

Average total deposits decreased $585 million, or 1 percent, to $57.7 billion.

• Reflected an increase of $1.7 billion, or 6 percent, in noninterest-bearing deposits, more than offset by a decrease of $2.2 billion, or 7 percent, in interest-bearing deposits.

• Decrease in average total deposits reflected decreases in general Middle Market and Corporate Banking, partially offset by an increase in Retail Bank.

Net interest income increased $108 million, or 6 percent, to $1.8 billion.

• Benefits from higher interest rates, loan growth and a larger securities portfolio, partially offset by higher debt costs.

Provision for credit losses increased $101 million to $248 million.

• Primarily due to the increase in reserves for Energy loans recorded in the first quarter 2016, partially offset by improvements in the remainder of the portfolio.

• Net credit-related charge-offs were $157 million, or 0.32 percent of average loans, for 2016, compared to $101 million, or 0.21 percent of average loans, for 2015. The increase was primarily due to an increase in charge-offs in the Energy portfolio.

Noninterest income increased $16 million to $1.1 billion in 2016.

• Customer-driven fees increased $22 million and non-fee categories declined $6 million. An increase in card fees as well as growth in fiduciary, customer derivative and foreign exchange income was partly offset by lower commercial lending fees and investment banking income.

Noninterest expenses increased $103 million to $1.9 billion.

• Excluding $93 million of restructuring charges related to GEAR Up and $33 million from the net release of litigation reserves in 2015, noninterest expenses decreased $23 million.

◦ Primarily reflected a decrease of $48 million in salaries and benefits, including GEAR Up savings estimated to be in excess of $25 million as well as an additional decrease in pension expense, partially offset by the impact of merit increases and one additional day in 2016.

◦ Additionally, increases in technology expense, outside processing fees and FDIC insurance premiums were partially offset by decreases in state business taxes and gains from the early termination of leveraged lease transactions.

The provision for income taxes decreased $36 million to $193 million.

• The effective tax rate was 28.8 percent in 2016, compared to 30.5 percent in 2015, primarily reflecting a $10 million increase in tax benefits from the early termination of certain leveraged lease transactions.

Continued execution of the capital plan.

• Repurchased approximately 6.6 million shares of common stock during 2016 under the equity repurchase program.

• Together with dividends of $0.89 per share, $458 million was returned to shareholders.

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COMERICA REPORTS FOURTH QUARTER 2016 NET INCOME OF $164 MILLION - 4

Net Interest Income

(dollar amounts in millions)	4th Qtr '16			3rd Qtr '16			4th Qtr '15
Net interest income	$	455		$	450		$	433
Net interest margin	2.65		%	2.66		%	2.58		%
Selected average balances:
Total earning assets	$	68,774		$	67,648		$	66,818
Total loans	48,915			49,206			48,548
Total investment securities	12,329			12,373			10,864
Federal Reserve Bank deposits	7,245			5,781			7,073
Total deposits	59,645			58,065			59,736
Total noninterest-bearing deposits	32,091			30,454			29,627
Medium- and long-term debt	5,578			5,907			3,089

• Net interest income increased $5 million to $455 million in the fourth quarter 2016, compared to the third quarter 2016.

◦ Interest on loans increased $1 million, reflecting higher loan yields (+$6 million), partially offset by the impact of lower average loan balances (-$2 million), the impact of a negative residual value adjustment to assets in the leasing portfolio (-$2 million) and other portfolio dynamics (-$1 million).

◦ Interest on investment securities increased $1 million, primarily reflecting the impact of an increase in investment volume.

◦ Interest on short-term investments increased $2 million, primarily reflecting an increase in average Federal Reserve Bank deposit balances.

◦ Interest expense on debt decreased $1 million, primarily due to the maturity of $650 million of debt in the fourth quarter 2016.

• The net interest margin of 2.65 percent decreased 1 basis point compared to the third quarter 2016, reflecting the impact of an increase in Federal Reserve Bank deposit balances (-4 basis points), partially offset by a benefit from the loan portfolio (+2 basis points), primarily due to higher short term rates, and lower debt expense (+1 basis point).

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COMERICA REPORTS FOURTH QUARTER 2016 NET INCOME OF $164 MILLION - 5

Credit Quality

“Our overall credit picture remains strong,” said Babb. “The provision and net charge-offs increased modestly from the very low levels of the third quarter. Net charge-offs were $36 million, or 29 basis points, which is at the low end of our historical norm, and included $15 million in Energy charge-offs. Total criticized loans declined $405 million and nonaccrual loans were down $49 million. 

“Over the past year, we have reduced our Energy loans by over $800 million, or 27 percent, which now represent less than 5 percent of our total loans. As the performance of this portfolio has improved, including a $319 million decrease in criticized loans in the fourth quarter, we have modestly reduced our reserve allocation, which sits at over 7 percent for energy loans as of December 31st.”

(dollar amounts in millions)	4th Qtr '16			3rd Qtr '16			4th Qtr '15
Credit-related charge-offs	$	48		$	35		$	76
Recoveries	12			19			25
Net credit-related charge-offs	36			16			51
Net credit-related charge-offs/Average total loans	0.29		%	0.13		%	0.42		%
Provision for credit losses	$	35		$	16		$	60
Nonperforming loans	590			639			379
Nonperforming assets (NPAs)	607			660			391
NPAs/Total loans and foreclosed property	1.24		%	1.34		%	0.80		%
Loans past due 90 days or more and still accruing	$	19		$	48		$	17
Allowance for loan losses	730			727			634
Allowance for credit losses on lending-related commitments (a)	41			45			45
Total allowance for credit losses	771			772			679
Allowance for loan losses/Period-end total loans	1.49		%	1.48		%	1.29		%
Allowance for loan losses/Nonperforming loans	124			114			167

(a) Included in "Accrued expenses and other liabilities" on the consolidated balance sheets.

• Energy business line loans were $2.3 billion at December 31, 2016 compared to $2.5 billion at September 30, 2016.

◦ Criticized Energy loans decreased $319 million, to $1.2 billion.

◦ Energy net charge-offs were $15 million, compared to $6 million in the third quarter 2016.

◦ The reserve allocation for loans in the Energy business line was over 7 percent at December 31, 2016.

• Net charge-offs increased $20 million to $36 million, or 0.29 percent of average loans, in the fourth quarter 2016, compared to $16 million, or 0.13 percent, in the third quarter 2016.

• During the fourth quarter 2016, $60 million of borrower relationships over $2 million were transferred to nonaccrual status, a decrease of $45 million compared to $105 million transferred during the third quarter. Fourth quarter transfers included $6 million from Energy, compared to $63 million in the third quarter.

• Criticized loans decreased $405 million to $2.9 billion at December 31, 2016, compared to $3.3 billion at September 30, 2016. Criticized loans are generally consistent with the Special Mention, Substandard and Doubtful categories defined by regulatory authorities.

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COMERICA REPORTS FOURTH QUARTER 2016 NET INCOME OF $164 MILLION - 6

Full-Year 2017 Outlook

For full-year 2017 compared to full-year 2016, management expects the following, assuming a continuation of the current economic and low rate environment as well as contributions from the GEAR Up initiative of $30 million in revenue and $125 million in expense savings, are as follows:

• Average loans higher, in line with Gross Domestic Product growth, reflecting increases in most lines of business and reduced headwinds from a declining Energy portfolio.

• Net interest income higher, reflecting the benefit from the December 2016 short-term rate increase and loan growth, partially offset by higher funding costs and minor loan yield compression.

◦ Full-year benefit from the December rise in short-term rates expected to be more than $70 million, assuming a 25 percent deposit beta.

• Provision for credit losses lower, with continued solid performance of the overall portfolio.

◦ Provision and net charge-offs in line with historical normal levels of 30-40 basis points.

• Noninterest income higher, with the execution of GEAR Up opportunities, modest growth in treasury management and card fees, as well as wealth management products such as fiduciary and brokerage services.

◦ Increase of 4 percent to 6 percent.

• Noninterest expenses lower, reflecting lower restructuring charges and an additional $125 million in GEAR Up savings, relative to 2016 GEAR Up savings of more than $25 million. Outside processing is expected to increase in line with growing revenue. Headwinds include increased technology costs and higher FDIC insurance expense, as well as typical inflationary pressure. The gains of $13 million in 2016 from early terminations of certain leveraged lease transactions are not expected to repeat.

◦ Restructuring charges of $25 million to $50 million, compared to $93 million in 2016.

◦ Remaining noninterest expenses 1 percent to 2 percent lower.

◦ Decrease of 4 percent to 5 percent including restructuring charges.

• Income tax expense to approximate 33 percent of pre-tax income.

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COMERICA REPORTS FOURTH QUARTER 2016 NET INCOME OF $164 MILLION - 7

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 atDecember 31, 2016. The accompanying narrative addresses fourth quarter 2016 results compared to third quarter 2016.

The following table presents net income (loss) by business segment.

(dollar amounts in millions)	4th Qtr '16					3rd Qtr '16					4th Qtr '15
Business Bank	$	205		92	%	$	189		91	%	$	198		91	%
Retail Bank	(4		)	(2	)	1			—		(1		)	(1	)
Wealth Management	23			10		18			9		21			10
	224			100	%	208			100	%	218			100	%
Finance	(61		)			(58		)			(100		)
Other (a)	1					(1		)			(2		)
Total	$	164				$	149				$	116

(a) Includes items not directly associated with the three major business segments or the Finance Division.

Business Bank

(dollar amounts in millions)	4th Qtr '16			3rd Qtr '16			4th Qtr '15
Net interest income	$	354		$	356		$	384
Provision for credit losses	17			2			41
Noninterest income	146			145			146
Noninterest expenses	196		(a)	215		(a)	207
Net income	205			189			198
Net credit-related charge-offs	33			14			35
Selected average balances:
Assets	39,220			39,618			39,305
Loans	37,893			38,243			37,682
Deposits	31,221			30,019			31,746

(a) Included restructuring charges of $7 million in the fourth quarter 2016 and $10 million in the third quarter 2016.

• Average loans decreased $350 million, primarily reflecting decreases in Mortgage Banker Finance, Energy, general Middle Market and Environmental Services, partially offset by an increase in National Dealer Services.

• Average deposits increased $1.2 billion, primarily reflecting increases in Corporate Banking, Energy and general Middle Market, partially offset by a decrease in Technology and Life Sciences. The increase was driven by growth in noninterest-bearing deposits.

• Net interest income decreased $2 million, primarily due to a negative residual value adjustment to assets in the leasing portfolio, a decrease in net funds transfer pricing (FTP) credits and a decrease in average loan balances. The decrease in net FTP credits primarily reflected higher funding costs, partially offset by the benefit from the increase in average deposits.

• The provision for credit losses increased $15 million. Net charge-offs increased $19 million, primarily reflecting increases in general Middle Market and Energy, partially offset by a decrease in Corporate Banking.

• Noninterest income increased $1 million, primarily due to increases in card fees and customer derivative income (largely as a result of a decrease in credit valuation adjustments), partially offset by a decrease in commercial lending fees (primarily syndication agent fees).

• Noninterest expenses decreased $19 million, primarily reflecting savings related to the GEAR Up initiative, a decrease in restructuring charges and an increase in gains from the early termination of certain leveraged lease transactions, partially offset by an increase in outside processing fees.

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COMERICA REPORTS FOURTH QUARTER 2016 NET INCOME OF $164 MILLION - 8

Retail Bank

(dollar amounts in millions)	4th Qtr '16				3rd Qtr '16			4th Qtr '15
Net interest income	$	156			$	156		$	160
Provision for credit losses	22				10			23
Noninterest income	48				50			49
Noninterest expenses	188			(a)	195		(a)	191
Net income (loss)	(4		)		1			(1		)
Net credit-related charge-offs	5				3			25
Selected average balances:
Assets	6,559				6,544			6,549
Loans	5,906				5,871			5,868
Deposits	23,915				23,654			23,262

(a) Included restructuring charges of $11 million in the fourth quarter 2016 and $8 million in the third quarter 2016.

• Average loans increased $35 million, primarily reflecting increases in Retail Banking (primarily consumer loans and residential mortgages) and Small Business (primarily commercial mortgages).

• Average deposits increased $261 million, primarily reflecting increases in noninterest-bearing, money market and interest-bearing checking deposits, partially offset by a decrease in certificates of deposits.

• The provision for credit losses increased $12 million, primarily reflecting an increase in reserves for Small Business.

• Noninterest income decreased $2 million, primarily reflecting a securities loss in the fourth quarter.

• Noninterest expenses decreased $7 million. Excluding a $3 million increase in restructuring charges, noninterest expenses decreased $10 million, primarily reflecting savings related to the GEAR Up Initiative.

Wealth Management

(dollar amounts in millions)	4th Qtr '16				3rd Qtr '16				4th Qtr '15
Net interest income	$	42			$	41			$	47
Provision for credit losses	(1		)		(1		)		(7		)
Noninterest income	62				61				57
Noninterest expenses	72			(a)	75			(a)	81
Net income	23				18				21
Net credit-related charge-offs (recoveries)	(2		)		(1		)		(9		)
Selected average balances:
Assets	5,268				5,283				5,199
Loans	5,116				5,092				4,998
Deposits	4,092				4,030				4,355

(a) Included restructuring charges of $2 million in both the fourth and third quarters of 2016.

• Average loans increased $24 million, primarily reflecting an increase in Private Banking.

• Average deposits increased $62 million, primarily reflecting increases in noninterest-bearing, money market and interest-bearing checking deposits.

• Noninterest expenses decreased $3 million, primarily due to savings related to the GEAR Up initiative and a decrease in operational losses.

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COMERICA REPORTS FOURTH QUARTER 2016 NET INCOME OF $164 MILLION - 9

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, 2016.

The following table presents net income (loss) by market segment.

(dollar amounts in millions)	4th Qtr '16					3rd Qtr '16					4th Qtr '15
Michigan	$	70		31	%	$	50		24	%	$	82		38	%
California	74			33		74			35		89			41
Texas	22			10		33			16		(3		)	(2	)
Other Markets	58			26		51			25		50			23
	224			100	%	208			100	%	218			100	%
Finance & Other (a)	(60		)			(59		)			(102		)
Total	$	164				$	149				$	116

(a) Includes items not directly associated with the geographic markets.

• Average loans decreased $185 million in Texas, primarily reflecting a decrease in Energy, and increased $50 million in Michigan and $29 million in California.

• Average deposits increased $685 million in California, $526 million in Texas and $86 million in Michigan. The increase in California primarily reflected increases in Corporate Banking and general Middle Market, partially offset by a decrease in Technology and Life Sciences. The increase in Texas primarily reflected an increase in Energy.

• Net interest income increased $3 million in California and decreased $2 million in Texas and $1 million in Michigan. The changes in net interest income primarily reflected the net FTP impact of changes in loan and deposit balances in each market, including the negative impact of a higher cost of funds rate in the fourth quarter. In addition, Michigan was impacted by a negative residual value adjustment to assets in the leasing portfolio.

• The provision for credit losses increased $29 million and $16 million in Texas and California, respectively, and decreased $13 million in Michigan.

• Noninterest income decreased $3 million in California and $1 million in Michigan, and increased $1 million in Texas. The decrease in California was primarily due to a decrease in syndication agent fees.

• Noninterest expenses decreased $12 million in Michigan, $10 million in Texas and $9 million in California. Much of the decrease in each market was due to the impact of the GEAR Up initiative. In addition, the decrease in Michigan reflected an increase in gains on the early termination of certain leveraged lease transactions and a decrease in operational losses.

Michigan Market

(dollar amounts in millions)	4th Qtr '16			3rd Qtr '16			4th Qtr '15
Net interest income	$	167		$	168		$	182
Provision for credit losses	—			13			(12		)
Noninterest income	81			82			81
Noninterest expenses	149		(a)	161		(a)	161
Net income	70			50			82
Net credit-related charge-offs (recoveries)	3			1			(2		)
Selected average balances:
Assets	13,174			13,174			13,601
Loans	12,538			12,488			12,986
Deposits	22,030			21,944			22,123

(a) Included restructuring charges of $4 million in the fourth quarter 2016 and $5 million in the third quarter 2016.

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COMERICA REPORTS FOURTH QUARTER 2016 NET INCOME OF $164 MILLION - 10

California Market

(dollar amounts in millions)	4th Qtr '16			3rd Qtr '16				4th Qtr '15
Net interest income	$	182		$	179			$	192
Provision for credit losses	12			(4		)		(7		)
Noninterest income	41			44				40
Noninterest expenses	101		(a)	110			(a)	107
Net income	74			74				89
Net credit-related charge-offs	1			—				1
Selected average balances:
Assets	17,947			17,933				17,297
Loans	17,666			17,637				17,033
Deposits	18,359			17,674				18,545

(a) Included restructuring charges of $4 million in the fourth quarter 2016 and $5 million in the third quarter 2016.

Texas Market

(dollar amounts in millions)	4th Qtr '16			3rd Qtr '16				4th Qtr '15
Net interest income	$	115		$	117			$	130
Provision for credit losses	26			(3		)		57
Noninterest income	34			33				32
Noninterest expenses	92		(a)	102			(a)	102
Net (loss) income	22			33				(3		)
Net credit-related charge-offs	30			10				33
Selected average balances:
Assets	10,810			11,014				11,474
Loans	10,381			10,566				10,893
Deposits	10,386			9,860				10,807

(a) Included restructuring charges of $6 million in the fourth quarter 2016 and $7 million in the third quarter 2016.

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COMERICA REPORTS FOURTH QUARTER 2016 NET INCOME OF $164 MILLION - 11

Conference Call and Webcast

Comerica will host a conference call to review fourth quarter 2016 financial results at 7 a.m. CT Tuesday January 17, 2017. Interested parties may access the conference call by calling (800) 309-2262 or (706) 679-5261 (event ID No. 28675280). 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.

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COMERICA REPORTS FOURTH QUARTER 2016 NET INCOME OF $164 MILLION - 12

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, including the GEAR Up initiative, and forecasts of Comerica's revenue, earnings or other measures of economic performance, including statements of profitability, business segments and subsidiaries as well as estimates of the economic benefits of the GEAR Up initiative, 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, in particular the energy industry; unfavorable developments concerning credit quality; 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; reductions in Comerica's credit rating; whether Comerica may achieve opportunities for revenue enhancements and efficiency improvements under the GEAR Up initiative, or changes in the scope or assumptions underlying the GEAR Up initiative; the interdependence of financial service companies; the implementation of Comerica's strategies and business initiatives; damage to Comerica's reputation; 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, 2015, "Item 1A. Risk Factors” on page 54 of Comerica's Quarterly Report on Form 10-Q for the quarter ended March 31, 2016, and "Item 1A. Risk Factors” on page 62 of Comerica's Quarterly Report on Form 10-Q for the quarter ended June 30, 2016. 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.

Media Contact:	Investor Contacts:
Wayne J. Mielke	Darlene P. Persons
(214) 462-4463	(214) 462-6831
	Chelsea R. Smith
	(214) 462-6834

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)	2016			2016			2015			2016			2015
PER COMMON SHARE AND COMMON STOCK DATA
Diluted net income	$	0.92		$	0.84		$	0.64		$	2.68		$	2.84
Cash dividends declared	0.23			0.23			0.21			0.89			0.83
Average diluted shares (in thousands)	177,457			176,184			179,197			176,730			181,104
KEY RATIOS
Return on average common shareholders' equity	8.48		%	7.80		%	6.08		%	6.22		%	6.91		%
Return on average assets	0.88			0.82			0.64			0.67			0.74
Common equity tier 1 and tier 1 risk-based capital ratio (a)	11.07			10.69			10.54
Total risk-based capital ratio (a)	13.24			12.84			12.69
Leverage ratio (a)	10.18			10.14			10.22
Common equity ratio	10.68			10.42			10.52
Tangible common equity ratio (b)	9.89			9.64			9.70
AVERAGE BALANCES
Commercial loans	30,792			31,132			31,219			31,062			31,501
Real estate construction loans	2,837			2,646			1,961			2,508			1,884
Commercial mortgage loans	8,918			9,012			8,842			8,981			8,697
Lease financing	619			662			750			684			783
International loans	1,303			1,349			1,402			1,367			1,441
Residential mortgage loans	1,923			1,883			1,896			1,894			1,878
Consumer loans	2,523			2,522			2,478			2,500			2,444
Total loans	48,915			49,206			48,548			48,996			48,628
Earning assets	68,774			67,648			66,818			66,545			65,129
Total assets	74,126			72,909			71,907			71,743			70,247
Noninterest-bearing deposits	32,091			30,454			29,627			29,751			28,087
Interest-bearing deposits	27,554			27,611			30,109			27,990			30,239
Total deposits	59,645			58,065			59,736			57,741			58,326
Common shareholders' equity	7,734			7,677			7,613			7,674			7,534
NET INTEREST INCOME
Net interest income	$	455		$	450		$	433		$	1,797		$	1,689
Net interest margin (fully taxable equivalent)	2.65		%	2.66		%	2.58		%	2.71		%	2.60		%
CREDIT QUALITY
Total nonperforming assets	$	607		$	660		$	391
Loans past due 90 days or more and still accruing	19			48			17
Net credit-related charge-offs	36			16			51			$	157		$	101
Allowance for loan losses	730			727			634
Allowance for credit losses on lending-related commitments	41			45			45
Total allowance for credit losses	771			772			679
Allowance for loan losses as a percentage of total loans	1.49		%	1.48		%	1.29		%
Net credit-related charge-offs as a percentage of average total loans	0.29			0.13			0.42			0.32		%	0.21		%
Nonperforming assets as a percentage of total loans and foreclosed property	1.24			1.34			0.80
Allowance for loan losses as a percentage of total nonperforming loans	124			114			167

(a) December 31, 2016 ratios are estimated.

(b) See Reconciliation of Non-GAAP Financial Measures.

13

CONSOLIDATED BALANCE SHEETS
Comerica Incorporated and Subsidiaries
	December 31,			September 30,			December 31,
(in millions, except share data)	2016			2016			2015
	(unaudited)			(unaudited)
ASSETS
Cash and due from banks	$	1,249		$	1,292		$	1,157
Interest-bearing deposits with banks	5,969			6,748			4,990
Other short-term investments	92			92			113
Investment securities available-for-sale	10,787			10,789			10,519
Investment securities held-to-maturity	1,582			1,695			1,981
Commercial loans	30,994			31,152			31,659
Real estate construction loans	2,869			2,743			2,001
Commercial mortgage loans	8,931			9,013			8,977
Lease financing	572			648			724
International loans	1,258			1,303			1,368
Residential mortgage loans	1,942			1,874			1,870
Consumer loans	2,522			2,541			2,485
Total loans	49,088			49,274			49,084
Less allowance for loan losses	(730		)	(727		)	(634		)
Net loans	48,358			48,547			48,450
Premises and equipment	501			528			550
Accrued income and other assets	4,440			4,433			4,117
Total assets	$	72,978		$	74,124		$	71,877
LIABILITIES AND SHAREHOLDERS' EQUITY
Noninterest-bearing deposits	$	31,540		$	31,776		$	30,839
Money market and interest-bearing checking deposits	22,556			22,436			23,532
Savings deposits	2,064			2,052			1,898
Customer certificates of deposit	2,806			2,967			3,552
Foreign office time deposits	19			30			32
Total interest-bearing deposits	27,445			27,485			29,014
Total deposits	58,985			59,261			59,853
Short-term borrowings	25			12			23
Accrued expenses and other liabilities	1,012			1,234			1,383
Medium- and long-term debt	5,160			5,890			3,058
Total liabilities	65,182			66,397			64,317
Common stock - $5 par value:
Authorized - 325,000,000 shares
Issued - 228,164,824 shares	1,141			1,141			1,141
Capital surplus	2,135			2,174			2,173
Accumulated other comprehensive loss	(383		)	(292		)	(429		)
Retained earnings	7,331			7,262			7,084
Less cost of common stock in treasury - 52,851,156 shares at 12/31/16; 56,096,416 shares at 9/30/16 and 52,457,113 shares at 12/31/15	(2,428		)	(2,558		)	(2,409		)
Total shareholders' equity	7,796			7,727			7,560
Total liabilities and shareholders' equity	$	72,978		$	74,124		$	71,877

14

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)	2016			2015		2016			2015
INTEREST INCOME
Interest and fees on loans	$	412		$	395	$	1,635		$	1,551
Interest on investment securities	62			56		247			216
Interest on short-term investments	10			6		27			17
Total interest income	484			457		1,909			1,784
INTEREST EXPENSE
Interest on deposits	10			10		40			43
Interest on medium- and long-term debt	19			14		72			52
Total interest expense	29			24		112			95
Net interest income	455			433		1,797			1,689
Provision for credit losses	35			60		248			147
Net interest income after provision for credit losses	420			373		1,549			1,542
NONINTEREST INCOME
Card fees	79			73		303			276
Service charges on deposit accounts	54			55		219			223
Fiduciary income	48			45		190			187
Commercial lending fees	21			30		89			99
Letter of credit fees	12			14		50			53
Bank-owned life insurance	12			11		42			40
Foreign exchange income	11			11		42			40
Brokerage fees	5			4		19			17
Net securities losses	(2		)	—		(5		)	(2		)
Other noninterest income	27			23		102			102
Total noninterest income	267			266		1,051			1,035
NONINTEREST EXPENSES
Salaries and benefits expense	219			262		961			1,009
Outside processing fee expense	89			79		336			318
Net occupancy expense	40			41		157			159
Equipment expense	13			14		53			53
Restructuring charges	20			—		93			—
Software expense	29			26		119			99
FDIC insurance expense	15			10		54			37
Advertising expense	6			7		21			24
Litigation-related expense	1			—		1			(32		)
Other noninterest expenses	29			43		135			160
Total noninterest expenses	461			482		1,930			1,827
Income before income taxes	226			157		670			750
Provision for income taxes	62			41		193			229
NET INCOME	164			116		477			521
Less income allocated to participating securities	1			1		4			6
Net income attributable to common shares	$	163		$	115	$	473		$	515
Earnings per common share:
Basic	$	0.95		$	0.65	$	2.74		$	2.93
Diluted	0.92			0.64		2.68			2.84
Comprehensive income	73			32		523			504
Cash dividends declared on common stock	40			37		155			148
Cash dividends declared per common share	0.23			0.21		0.89			0.83

15

CONSOLIDATED QUARTERLY STATEMENTS OF COMPREHENSIVE INCOME (unaudited)
Comerica Incorporated and Subsidiaries
	Fourth			Third		Second			First			Fourth		Fourth Quarter 2016 Compared To:
	Quarter			Quarter		Quarter			Quarter			Quarter		Third Quarter 2016					Fourth Quarter 2015
(in millions, except per share data)	2016			2016		2016			2016			2015		Amount			Percent		Amount			Percent
INTEREST INCOME
Interest and fees on loans	$	412		$	411	$	406		$	406		$	395	$	1		—	%	$	17		4	%
Interest on investment securities	62			61		62			62			56		1			1		6			8
Interest on short-term investments	10			8		5			4			6		2			29		4			82
Total interest income	484			480		473			472			457		4			1		27			6
INTEREST EXPENSE
Interest on deposits	10			10		10			10			10		—			—		—			—
Interest on medium- and long-term debt	19			20		18			15			14		(1		)	(10	)	5			31
Total interest expense	29			30		28			25			24		(1		)	(7	)	5			14
Net interest income	455			450		445			447			433		$	5		1		$	22		5
Provision for credit losses	35			16		49			148			60		19			n/m		(25		)	(41	)
Net interest income after provision for credit losses	420			434		396			299			373		(14		)	(3	)	47			13
NONINTEREST INCOME
Card fees	79			76		76			72			73		3			3		6			8
Service charges on deposit accounts	54			55		55			55			55		(1		)	(2	)	(1		)	(2	)
Fiduciary income	48			47		49			46			45		1			1		3			6
Commercial lending fees	21			26		22			20			30		(5		)	(15	)	(9		)	(30	)
Letter of credit fees	12			12		13			13			14		—			—		(2		)	(10	)
Bank-owned life insurance	12			12		9			9			11		—			—		1			5
Foreign exchange income	11			10		11			10			11		1			6		—			—
Brokerage fees	5			5		5			4			4		—			—		1			35
Net securities losses	(2		)	—		(1		)	(2		)	—		(2		)	n/m		(2		)	n/m
Other noninterest income	27			29		29			17			23		(2		)	(3	)	4			13
Total noninterest income	267			272		268			244			266		(5		)	(2	)	1			—
NONINTEREST EXPENSES
Salaries and benefits expense	219			247		247			248			262		(28		)	(12	)	(43		)	(17	)
Outside processing fee expense	89			86		83			78			79		3			3		10			12
Net occupancy expense	40			40		39			38			41		—			—		(1		)	(1	)
Equipment expense	13			13		14			13			14		—			—		(1		)	(4	)
Restructuring charges	20			20		53			—			—		—			—		20			n/m
Software expense	29			31		30			29			26		(2		)	(4	)	3			14
FDIC insurance expense	15			14		14			11			10		1			6		5			38
Advertising expense	6			5		6			4			7		1			9		(1		)	(16	)
Litigation-related expense	1			—		—			—			—		1			n/m		1			n/m
Other noninterest expenses	29			37		32			37			43		(8		)	(20	)	(14		)	(31	)
Total noninterest expenses	461			493		518			458			482		(32		)	(6	)	(21		)	(4	)
Income before income taxes	226			213		146			85			157		13			6		69			44
Provision for income taxes	62			64		42			25			41		(2		)	(1	)	21			52
NET INCOME	164			149		104			60			116		15			9		48			42
Less income allocated to participating securities	1			1		1			1			1		—			—		—			—
Net income attributable to common shares	$	163		$	148	$	103		$	59		$	115	$	15		10	%	$	48		42	%
Earnings per common share:
Basic	$	0.95		$	0.87	$	0.60		$	0.34		$	0.65	$	0.08		9	%	$	0.30		46	%
Diluted	0.92			0.84		0.58			0.34			0.64		0.08			10		0.28			44
Comprehensive income	73			152		137			161			32		(79		)	(52	)	41			n/m
Cash dividends declared on common stock	40			40		38			37			37		—			—		3			9
Cash dividends declared per common share	0.23			0.23		0.22			0.21			0.21		—			—		0.02			10

n/m - not meaningful

16

ANALYSIS OF THE ALLOWANCE FOR LOAN LOSSES (unaudited)
Comerica Incorporated and Subsidiaries
	2016												2015
(in millions)	4th Qtr			3rd Qtr			2nd Qtr			1st Qtr			4th Qtr
Balance at beginning of period	$	727		$	729		$	724		$	634		$	622
Loan charge-offs:
Commercial	37			24			48			72			73
Commercial mortgage	1			2			—			—			1
International	8			8			4			3			—
Consumer	2			1			2			2			2
Total loan charge-offs	48			35			54			77			76
Recoveries on loans previously charged-off:
Commercial	7			15			9			12			6
Commercial mortgage	3			3			2			12			11
Residential mortgage	1			—			—			—			1
Consumer	1			1			1			1			7
Total recoveries	12			19			12			25			25
Net loan charge-offs	36			16			42			52			51
Provision for loan losses	39			14			47			141			63
Foreign currency translation adjustment	—			—			—			1			—
Balance at end of period	$	730		$	727		$	729		$	724		$	634
Allowance for loan losses as a percentage of total loans	1.49		%	1.48		%	1.45		%	1.47		%	1.29		%
Net loan charge-offs as a percentage of average total loans	0.29			0.13			0.34			0.43			0.42

ANALYSIS OF THE ALLOWANCE FOR CREDIT LOSSES ON LENDING-RELATED COMMITMENTS (unaudited)
Comerica Incorporated and Subsidiaries
	2016											2015
(in millions)	4th Qtr			3rd Qtr		2nd Qtr			1st Qtr			4th Qtr
Balance at beginning of period	$	45		$	43	$	46		$	45		$	48
Less: Charge-offs on lending-related commitments (a)	—			—		(5		)	(6		)	—
Add: Provision for credit losses on lending-related commitments	(4		)	2		2			7			(3		)
Balance at end of period	$	41		$	45	$	43		$	46		$	45
Unfunded lending-related commitments sold	$	—		$	—	$	12		$	11		$	—

(a) Charge-offs result from the sale of unfunded lending-related commitments.

17

NONPERFORMING ASSETS (unaudited)
Comerica Incorporated and Subsidiaries
	2016												2015
(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	$	445		$	508		$	482		$	547		$	238
Real estate construction	—			—			—			—			1
Commercial mortgage	46			44			44			47			60
Lease financing	6			6			6			6			6
International	14			19			18			27			8
Total nonaccrual business loans	511			577			550			627			313
Retail loans:
Residential mortgage	39			23			26			26			27
Consumer:
Home equity	28			27			28			27			27
Other consumer	4			4			1			1			—
Total consumer	32			31			29			28			27
Total nonaccrual retail loans	71			54			55			54			54
Total nonaccrual loans	582			631			605			681			367
Reduced-rate loans	8			8			8			8			12
Total nonperforming loans	590			639			613			689			379
Foreclosed property	17			21			22			25			12
Total nonperforming assets	$	607		$	660		$	635		$	714		$	391
Nonperforming loans as a percentage of total loans	1.20		%	1.30		%	1.22		%	1.40		%	0.77		%
Nonperforming assets as a percentage of total loans  and foreclosed property	1.24			1.34			1.26			1.45			0.80
Allowance for loan losses as a percentage of total nonperforming loans	124			114			119			105			167
Loans past due 90 days or more and still accruing	$	19		$	48		$	35		$	13		$	17
ANALYSIS OF NONACCRUAL LOANS
Nonaccrual loans at beginning of period	$	631		$	605		$	681		$	367		$	357
Loans transferred to nonaccrual (a)	60			105			107			446			105
Nonaccrual business loan gross charge-offs (b)	(46		)	(34		)	(52		)	(75		)	(49		)
Nonaccrual business loans sold (c)	(10		)	(2		)	(40		)	(21		)	—
Payments/Other (d)	(53		)	(43		)	(91		)	(36		)	(46		)
Nonaccrual loans at end of period	$	582		$	631		$	605		$	681		$	367
(a) Based on an analysis of nonaccrual loans with book balances greater than $2 million.
(b) Analysis of gross loan charge-offs:
Nonaccrual business loans	$	46		$	34		$	52		$	75		$	49
Performing business loans	—			—			—			—			25
Consumer and residential mortgage loans	2			1			2			2			2
Total gross loan charge-offs	$	48		$	35		$	54		$	77		$	76
(c) Analysis of loans sold:
Nonaccrual business loans	$	10		$	2		$	40		$	21		$	—
Performing criticized loans	—			—			—			—			3
Total criticized loans sold	$	10		$	2		$	40		$	21		$	3
(d) 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.

18

ANALYSIS OF NET INTEREST INCOME (unaudited)
Comerica Incorporated and Subsidiaries
	Years Ended
	December 31, 2016							December 31, 2015
	Average					Average		Average					Average
(dollar amounts in millions)	Balance			Interest		Rate (a)		Balance			Interest		Rate (a)
Commercial loans	$	31,062		$	1,008	3.26	%	$	31,501		$	962	3.07	%
Real estate construction loans	2,508			91		3.63		1,884			66		3.48
Commercial mortgage loans	8,981			314		3.49		8,697			296		3.41
Lease financing	684			18		2.65		783			25		3.17
International loans	1,367			50		3.63		1,441			51		3.58
Residential mortgage loans	1,894			71		3.76		1,878			71		3.77
Consumer loans	2,500			83		3.32		2,444			80		3.26
Total loans	48,996			1,635		3.34		48,628			1,551		3.20
Mortgage-backed securities (b)	9,356			203		2.19		9,113			202		2.24
Other investment securities	2,992			44		1.51		1,124			14		1.25
Total investment securities (b)	12,348			247		2.02		10,237			216		2.13
Interest-bearing deposits with banks	5,099			26		0.51		6,158			16		0.26
Other short-term investments	102			1		0.61		106			1		0.81
Total earning assets	66,545			1,909		2.88		65,129			1,784		2.75
Cash and due from banks	1,146							1,059
Allowance for loan losses	(730		)					(621		)
Accrued income and other assets	4,782							4,680
Total assets	$	71,743						$	70,247
Money market and interest-bearing checking deposits	$	22,744		27		0.11		$	24,073		26		0.11
Savings deposits	2,013			—		0.02		1,841			—		0.02
Customer certificates of deposit	3,200			13		0.40		4,209			16		0.37
Foreign office time deposits	33			—		0.35		116			1		1.02
Total interest-bearing deposits	27,990			40		0.14		30,239			43		0.14
Short-term borrowings	138			—		0.45		93			—		0.05
Medium- and long-term debt	4,917			72		1.45		2,905			52		1.80
Total interest-bearing sources	33,045			112		0.34		33,237			95		0.29
Noninterest-bearing deposits	29,751							28,087
Accrued expenses and other liabilities	1,273							1,389
Total shareholders' equity	7,674							7,534
Total liabilities and shareholders' equity	$	71,743						$	70,247
Net interest income/rate spread				$	1,797	2.54					$	1,689	2.46
Impact of net noninterest-bearing sources of funds						0.17							0.14
Net interest margin (as a percentage of average earning assets)						2.71	%						2.60	%

(a) Fully taxable equivalent.

(b) Includes investment securities available-for-sale and investment securities held-to-maturity.

19

ANALYSIS OF NET INTEREST INCOME (unaudited)
Comerica Incorporated and Subsidiaries
	Three Months Ended
	December 31, 2016							September 30, 2016							December 31, 2015
	Average					Average		Average					Average		Average					Average
(dollar amounts in millions)	Balance			Interest		Rate (a)		Balance			Interest		Rate (a)		Balance			Interest		Rate (a)
Commercial loans	$	30,792		$	255	3.30	%	$	31,132		$	253	3.25	%	$	31,219		$	244	3.11	%
Real estate construction loans	2,837			26		3.65		2,646			24		3.57		1,961			18		3.58
Commercial mortgage loans	8,918			78		3.49		9,012			78		3.43		8,842			76		3.43
Lease financing	619			3		1.95		662			5		3.30		750			6		3.29
International loans	1,303			12		3.70		1,349			12		3.56		1,402			12		3.40
Residential mortgage loans	1,923			17		3.60		1,883			18		3.74		1,896			18		3.75
Consumer loans	2,523			21		3.28		2,522			21		3.31		2,478			21		3.38
Total loans	48,915			412		3.36		49,206			411		3.33		48,548			395		3.24
Mortgage-backed securities (b)	9,386			51		2.16		9,359			50		2.17		9,226			51		2.25
Other investment securities	2,943			11		1.54		3,014			11		1.51		1,638			5		1.37
Total investment securities (b)	12,329			62		2.01		12,373			61		2.01		10,864			56		2.11
Interest-bearing deposits with banks	7,438			10		0.52		5,967			8		0.51		7,300			5		0.28
Other short-term investments	92			—		0.47		102			—		0.43		106			1		0.91
Total earning assets	68,774			484		2.81		67,648			480		2.84		66,818			457		2.73
Cash and due from banks	1,290							1,152							1,071
Allowance for loan losses	(740		)					(749		)					(641		)
Accrued income and other assets	4,802							4,858							4,659
Total assets	$	74,126						$	72,909						$	71,907
Money market and interest-bearing checking deposits	$	22,585		7		0.12		$	22,415		7		0.12		$	24,368		6		0.11
Savings deposits	2,064			—		0.02		2,042			—		0.03		1,883			—		0.02
Customer certificates of deposit	2,878			3		0.39		3,129			3		0.40		3,763			4		0.39
Foreign office time deposits	27			—		0.36		25			—		0.37		95			—		0.59
Total interest-bearing deposits	27,554			10		0.14		27,611			10		0.14		30,109			10		0.14
Short-term borrowings	13			—		0.50		17			—		0.47		92			—		0.06
Medium- and long-term debt	5,578			19		1.30		5,907			20		1.36		3,089			14		1.79
Total interest-bearing sources	33,145			29		0.33		33,535			30		0.36		33,290			24		0.29
Noninterest-bearing deposits	32,091							30,454							29,627
Accrued expenses and other liabilities	1,156							1,243							1,377
Total shareholders' equity	7,734							7,677							7,613
Total liabilities and shareholders' equity	$	74,126						$	72,909						$	71,907
Net interest income/rate spread				$	455	2.48					$	450	2.48					$	433	2.44
Impact of net noninterest-bearing sources of funds						0.17							0.18							0.14
Net interest margin (as a percentage of average earning assets)						2.65	%						2.66	%						2.58	%

(a) Fully taxable equivalent.

(b) Includes investment securities available-for-sale and investment securities held-to-maturity.

20

CONSOLIDATED STATISTICAL DATA (unaudited)
Comerica Incorporated and Subsidiaries
	December 31,			September 30,			June 30,			March 31,			December 31,
(in millions, except per share data)	2016			2016			2016			2016			2015
Commercial loans:
Floor plan	$	4,269		$	3,778		$	4,120		$	3,902		$	3,939
Other	26,725			27,374			28,240			27,660			27,720
Total commercial loans	30,994			31,152			32,360			31,562			31,659
Real estate construction loans	2,869			2,743			2,553			2,290			2,001
Commercial mortgage loans	8,931			9,013			9,038			8,982			8,977
Lease financing	572			648			684			731			724
International loans	1,258			1,303			1,365			1,455			1,368
Residential mortgage loans	1,942			1,874			1,856			1,874			1,870
Consumer loans:
Home equity	1,800			1,792			1,779			1,738			1,720
Other consumer	722			749			745			745			765
Total consumer loans	2,522			2,541			2,524			2,483			2,485
Total loans	$	49,088		$	49,274		$	50,380		$	49,377		$	49,084
Goodwill	$	635		$	635		$	635		$	635		$	635
Core deposit intangible	7			8			9			9			10
Other intangibles	3			3			3			4			4
Common equity tier 1 capital (a)	7,539			7,378			7,346			7,331			7,350
Risk-weighted assets (a)	68,136			69,018			70,056			69,319			69,731
Common equity tier 1 and tier 1 risk-based capital ratio (a)	11.07		%	10.69		%	10.49		%	10.58		%	10.54		%
Total risk-based capital ratio (a)	13.24			12.84			12.74			12.84			12.69
Leverage ratio (a)	10.18			10.14			10.39			10.60			10.22
Common equity ratio	10.68			10.42			10.79			11.08			10.52
Tangible common equity ratio (b)	9.89			9.64			9.98			10.23			9.70
Common shareholders' equity per share of common stock	$	44.47		$	44.91		$	44.24		$	43.66		$	43.03
Tangible common equity per share of common stock (b)	40.79			41.15			40.52			39.96			39.33
Market value per share for the quarter:
High	70.44			47.81			47.55			41.74			47.44
Low	46.75			38.39			36.27			30.48			39.52
Close	68.11			47.32			41.13			37.87			41.83
Quarterly ratios:
Return on average common shareholders' equity	8.48		%	7.80		%	5.44		%	3.13		%	6.08		%
Return on average assets	0.88			0.82			0.59			0.34			0.64
Efficiency ratio (c)	63.58			68.15			72.43			65.99			68.92
Number of banking centers	458			473			473			477			477
Number of employees - full time equivalent	7,960			8,476			8,792			8,869			8,880

(a) December 31, 2016 amounts and ratios are estimated.

(b) See Reconciliation of Non-GAAP Financial Measures.

(c) Noninterest expenses as a percentage of the sum of net interest income (FTE) and noninterest income excluding net securities gains (losses).

21

PARENT COMPANY ONLY BALANCE SHEETS (unaudited)
Comerica Incorporated
	December 31,			September 30,			December 31,
(in millions, except share data)	2016			2016			2015
ASSETS
Cash and due from subsidiary bank	$	411		$	—		$	4
Short-term investments with subsidiary bank	350			588			569
Other short-term investments	87			88			89
Investment in subsidiaries, principally banks	7,561			7,685			7,523
Premises and equipment	2			2			3
Other assets	150			161			137
Total assets	$	8,561		$	8,524		$	8,325
LIABILITIES AND SHAREHOLDERS' EQUITY
Medium- and long-term debt	$	604		$	626		$	608
Other liabilities	161			171			157
Total liabilities	765			797			765
Common stock - $5 par value:
Authorized - 325,000,000 shares
Issued - 228,164,824 shares	1,141			1,141			1,141
Capital surplus	2,135			2,174			2,173
Accumulated other comprehensive loss	(383		)	(292		)	(429		)
Retained earnings	7,331			7,262			7,084
Less cost of common stock in treasury - 52,851,156 shares at 12/31/16; 59,096,416 shares at 9/30/16 and 52,457,113 shares at 12/31/15	(2,428		)	(2,558		)	(2,409		)
Total shareholders' equity	7,796			7,727			7,560
Total liabilities and shareholders' equity	$	8,561		$	8,524		$	8,325

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, 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
Net income	—		—		—			—			477			—			477
Other comprehensive income, net of tax	—		—		—			46			—			—			46
Cash dividends declared on common stock ($0.89 per share)	—		—		—			—			(154		)	—			(154		)
Purchase of common stock	(6.8	)	—		—			—			—			(310		)	(310		)
Net issuance of common stock under employee stock plans	4.1		—		(15		)	—			(27		)	185			143
Net issuance of common stock for warrants	2.3		—		(57		)	—			(49		)	106			—
Share-based compensation	—		—		34			—			—			—			34
BALANCE AT DECEMBER 31, 2016	175.3		$	1,141	$	2,135		$	(383	)	$	7,331		$	(2,428	)	$	7,796

22

BUSINESS SEGMENT FINANCIAL RESULTS (unaudited)
Comerica Incorporated and Subsidiaries
(dollar amounts in millions)	Business			Retail			Wealth
Three Months Ended December 31, 2016	Bank			Bank			Management			Finance			Other			Total
Earnings summary:
Net interest income (expense)	$	354		$	156		$	42		$	(103	)	$	6		$	455
Provision for credit losses	17			22			(1		)	—			(3		)	35
Noninterest income	146			48			62			10			1			267
Noninterest expenses	196			188			72			(1		)	6			461
Provision (benefit) for income taxes	82			(2		)	10			(31		)	3			62
Net income (loss)	$	205		$	(4	)	$	23		$	(61	)	$	1		$	164
Net credit-related charge-offs (recoveries)	$	33		$	5		$	(2	)	$	—		$	—		$	36
Selected average balances:
Assets	$	39,220		$	6,559		$	5,268		$	14,109		$	8,970		$	74,126
Loans	37,893			5,906			5,116			—			—			48,915
Deposits	31,221			23,915			4,092			107			310			59,645
Statistical data:
Return on average assets (a)	2.09		%	(0.06		)%	1.72		%	N/M			N/M			0.88		%
Efficiency ratio (b)	39.12			90.98			69.52			N/M			N/M			63.58
	Business			Retail			Wealth
Three Months Ended September 30, 2016	Bank			Bank			Management			Finance			Other			Total
Earnings summary:
Net interest income (expense)	$	356		$	156		$	41		$	(109	)	$	6		$	450
Provision for credit losses	2			10			(1		)	—			5			16
Noninterest income	145			50			61			13			3			272
Noninterest expenses	215			195			75			(1		)	9			493
Provision (benefit) for income taxes	95			—			10			(37		)	(4		)	64
Net income (loss)	$	189		$	1		$	18		$	(58	)	$	(1	)	$	149
Net credit-related charge-offs (recoveries)	$	14		$	3		$	(1	)	$	—		$	—		$	16
Selected average balances:
Assets	$	39,618		$	6,544		$	5,283		$	14,144		$	7,320		$	72,909
Loans	38,243			5,871			5,092			—			—			49,206
Deposits	30,019			23,654			4,030			98			264			58,065
Statistical data:
Return on average assets (a)	1.92		%	0.01		%	1.39		%	N/M			N/M			0.82		%
Efficiency ratio (b)	42.74			94.58			73.12			N/M			N/M			68.15
	Business			Retail			Wealth
Three Months Ended December 31, 2015	Bank			Bank			Management			Finance			Other			Total
Earnings summary:
Net interest income (expense)	$	384		$	160		$	47		$	(161	)	3			$	433
Provision for credit losses	41			23			(7		)	—			3			60
Noninterest income	146			49			57			12			2			266
Noninterest expenses	207			191			81			(2		)	5			482
Provision (benefit) for income taxes	84			(4		)	9			(47		)	(1		)	41
Net income (loss)	$	198		$	(1	)	$	21		$	(100	)	$	(2	)	$	116
Net credit-related charge-offs (recoveries)	$	35		$	25		$	(9	)	$	—		$	—		$	51
Selected average balances:
Assets	$	39,305		$	6,549		$	5,199		$	12,273		$	8,581		$	71,907
Loans	37,682			5,868			4,998			—			—			48,548
Deposits	31,746			23,262			4,355			115			258			59,736
Statistical data:
Return on average assets (a)	2.02		%	(0.03		)%	1.68		%	N/M			N/M			0.64		%
Efficiency ratio (b)	39.07			91.69			77.05			N/M			N/M			68.92

(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 (fully taxable equivalent basis) and noninterest income excluding net securities gains.

N/M - Not Meaningful

23

MARKET SEGMENT FINANCIAL RESULTS (unaudited)
Comerica Incorporated and Subsidiaries
(dollar amounts in millions)										Other			Finance
Three Months Ended December 31, 2016	Michigan			California			Texas			Markets			& Other			Total
Earnings summary:
Net interest income (expense)	$	167		$	182		$	115		$	88		$	(97	)	$	455
Provision for credit losses	—			12			26			—			(3		)	35
Noninterest income	81			41			34			100			11			267
Noninterest expenses	149			101			92			114			5			461
Provision (benefit) for income taxes	29			36			9			16			(28		)	62
Net income (loss)	$	70		$	74		$	22		$	58		$	(60	)	$	164
Net credit-related charge-offs	$	3		$	1		$	30		$	2		$	—		$	36
Selected average balances:
Assets	$	13,174		$	17,947		$	10,810		$	9,116		$	23,079		$	74,126
Loans	12,538			17,666			10,381			8,330			—			48,915
Deposits	22,030			18,359			10,386			8,453			417			59,645
Statistical data:
Return on average assets (a)	1.23		%	1.53		%	0.74		%	2.50		%	N/M			0.88		%
Efficiency ratio (b)	59.67			45.19			61.56			60.29			N/M			63.58
										Other			Finance
Three Months Ended September 30, 2016	Michigan			California			Texas			Markets			& Other			Total
Earnings summary:
Net interest income (expense)	$	168		$	179		$	117		$	89		$	(103	)	$	450
Provision for credit losses	13			(4		)	(3		)	5			5			16
Noninterest income	82			44			33			97			16			272
Noninterest expenses	161			110			102			112			8			493
Provision (benefit) for income taxes	26			43			18			18			(41		)	64
Net income (loss)	$	50		$	74		$	33		$	51		$	(59	)	$	149
Net credit-related charge-offs	$	1		$	—		$	10		$	5		$	—		$	16
Selected average balances:
Assets	$	13,174		$	17,933		$	11,014		$	9,324		$	21,464		$	72,909
Loans	12,488			17,637			10,566			8,515			—			49,206
Deposits	21,944			17,674			9,860			8,225			362			58,065
Statistical data:
Return on average assets (a)	0.89		%	1.59		%	1.14		%	2.21		%	N/M			0.82		%
Efficiency ratio (b)	64.30			48.86			67.96			60.11			N/M			68.15
										Other			Finance
Three Months Ended December 31, 2015	Michigan			California			Texas			Markets			& Other			Total
Earnings summary:
Net interest income (expense)	$	182		$	192		$	130		$	87		$	(158	)	$	433
Provision for credit losses	(12		)	(7		)	57			19			3			60
Noninterest income	81			40			32			99			14			266
Noninterest expenses	161			107			102			109			3			482
Provision (benefit) for income taxes	32			43			6			8			(48		)	41
Net income (loss)	$	82		$	89		$	(3	)	$	50		$	(102	)	$	116
Net credit-related charge-offs (recoveries)	$	(2	)	$	1		$	33		$	19		$	—		$	51
Selected average balances:
Assets	$	13,601		$	17,297		$	11,474		$	8,681		$	20,854		$	71,907
Loans	12,986			17,033			10,893			7,636			—			48,548
Deposits	22,123			18,545			10,807			7,888			373			59,736
Statistical data:
Return on average assets (a)	1.43		%	1.82		%	(0.11		)%	2.21		%	N/M			0.64		%
Efficiency ratio (b)	61.04			46.14			63.06			58.50			N/M			68.92

(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 (fully taxable equivalent basis) and noninterest income excluding net securities gains.

N/M - Not Meaningful

24

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)	2016			2016			2016			2016			2015
Tangible Common Equity Ratio:
Common shareholders' equity	$	7,796		$	7,727		$	7,694		$	7,644		$	7,560
Less:
Goodwill	635			635			635			635			635
Other intangible assets	10			11			12			13			14
Tangible common equity	$	7,151		$	7,081		$	7,047		$	6,996		$	6,911
Total assets	$	72,978		$	74,124		$	71,280		$	69,007		$	71,877
Less:
Goodwill	635			635			635			635			635
Other intangible assets	10			11			12			13			14
Tangible assets	$	72,333		$	73,478		$	70,633		$	68,359		$	71,228
Common equity ratio	10.68		%	10.42		%	10.79		%	11.08		%	10.52		%
Tangible common equity ratio	9.89			9.64			9.98			10.23			9.70
Tangible Common Equity per Share of Common Stock:
Common shareholders' equity	$	7,796		$	7,727		$	7,694		$	7,644		$	7,560
Tangible common equity	7,151			7,081			7,047			6,996			6,911
Shares of common stock outstanding (in millions)	175			172			174			175			176
Common shareholders' equity per share of common stock	$	44.47		$	44.91		$	44.24		$	43.66		$	43.03
Tangible common equity per share of common stock	40.79			41.15			40.52			39.96			39.33

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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