Exhibit 99.1
COMERICA REPORTS FOURTH QUARTER AND 2004 EARNINGS
DETROIT/January 20, 2005— Comerica Incorporated (NYSE: CMA) today reported fourth quarter 2004 earnings of $207 million, or $1.21 per diluted share, compared to $196 million, or $1.13 per diluted share, for the third quarter 2004 and $158 million, or $0.89 per diluted share, for the fourth quarter 2003.
(dollar amounts in millions) | 4th Qtr ‘04 | 3rd Qtr ‘04 | 4th Qtr ‘03 | |||||||||
Diluted EPS | $ | 1.21 | $ | 1.13 | $ | 0.89 | ||||||
Net Interest Income | $ | 466 | $ | 451 | $ | 457 | ||||||
Net Interest Margin | 3.96 | % | 3.86 | % | 3.83 | % | ||||||
Provision for Loan Losses | $ | (21 | ) | $ | — | $ | 77 | |||||
Noninterest Income | $ | 203 | $ | 206 | $ | 220 | ||||||
Noninterest Expenses | $ | 380 | $ | 372 | $ | 379 | ||||||
Net Income | $ | 207 | $ | 196 | $ | 158 | ||||||
Return on Equity | 16.39 | % | 15.68 | % | 12.33 | % |
Net income for 2004 was $757 million, or $4.36 per diluted share, compared to $661 million, or $3.75 per diluted share for 2003. Return on average common shareholders’ equity was 15.03 percent and return on average assets was 1.49 percent for 2004, compared to 13.12 percent and 1.25 percent, respectively, for 2003.
“We ended 2004 on a positive note with fourth quarter financial results that underscored the improving trends we have seen all year,” said Ralph W. Babb, Jr., chairman and chief executive officer. “Net interest income increased for the third consecutive quarter, and expenses were well controlled. As we enter 2005, we remain focused on revenue growth through our investment in branches, technology and products.”
Net Interest Income
Net interest income was $466 million for the fourth quarter 2004, compared to $451 million for the third quarter 2004 and $457 million for the fourth quarter 2003. Average earning assets of $47.0 billion for the fourth quarter 2004 increased $592 million from the third quarter 2004, or one percent, primarily as a result of a $484 million increase in average loans to $41.1 billion for the fourth quarter 2004; a nearly five percent annualized increase. Average deposits of $40.3 billion for the fourth quarter 2004 increased $593 million, or one percent, from the third quarter 2004.
The net interest margin increased 10 basis points from the third quarter 2004 to 3.96 percent in the fourth quarter 2004, due to greater contribution from noninterest-bearing deposits.
Noninterest Income
Noninterest income was $203 million for the fourth quarter 2004, compared to $206 million for the third quarter 2004 and $220 million for the fourth quarter 2003. There were no net securities gains in the fourth quarter 2004, compared to $6 million of net securities losses in the third quarter 2004 and $4 million of net securities gains in the fourth quarter 2003.
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COMERICA REPORTS FOURTH QUARTER AND 2004 EARNINGS - 2
Noninterest Expenses
Noninterest expenses were $380 million for the fourth quarter 2004 compared to $372 million for the third quarter 2004 and $379 million for the fourth quarter 2003. Included in salary and employee benefits expenses in the third quarter 2004 was a $7 million reduction in expense due to employee forfeitures of stock-based compensation and revisions to employee forfeiture assumptions for stock options. Severance expenses for the fourth quarter and 2004 were $3 million and $11 million, respectively, compared to $1 million for the third quarter 2004 and $2 million for 2003. Included in the fourth quarter 2004 was a $5 million net credit to litigation-related costs, compared to litigation-related costs of $12 million that were expensed in the third quarter 2004. Other noninterest expenses in the fourth quarter 2004 included interest expense on tax liabilities of $8 million, compared to $5 million for the third quarter 2004. Also included in other noninterest expenses in the fourth quarter 2004 was an increase of $6 million in contribution expense, mostly designated for the Comerica Charitable Foundation.
Credit Quality | ||||||||||||
(dollar amounts in millions) | 4th Qtr ‘04 | 3rd Qtr ‘04 | 4th Qtr ‘03 | |||||||||
Net Charge-offs | $ | 35 | $ | 33 | $ | 76 | ||||||
Net Charge-offs/Average Total Loans | 0.34 | % | 0.33 | % | 0.75 | % | ||||||
Provision for Loan Losses | $ | (21 | ) | $ | — | $ | 77 | |||||
Nonperforming Assets (NPAs) | $ | 339 | $ | 388 | $ | 538 | ||||||
NPAs/Total Loans, Other Real Estate & Nonaccrual Debt Securities | 0.83 | % | 0.98 | % | 1.33 | % | ||||||
Allowance for Loan Losses | $ | 673 | $ | 729 | $ | 803 | ||||||
Allowance for Loan Losses/Total Loans | 1.65 | % | 1.83 | % | 1.99 | % | ||||||
Allowance for Credit Losses on Lending-related Commitments* | $ | 21 | $ | 24 | $ | 33 |
* Included in “Accrued expenses and other liabilities” on the consolidated balance sheets.
During the fourth quarter of 2004, $71 million of loans greater than $2 million were transferred to nonaccrual status. Nonperforming assets were $339 million at December 31, 2004, a decrease of $49 million from September 30, 2004.
“For the fourth quarter, net charge-offs and nonperforming loans declined from year-ago levels,” said Babb.
“In 2004, credit quality trends improved every quarter, with the pace of these improvements moderating in the second half of the year.”
Balance Sheet and Capital Management
Total assets and common shareholders’ equity were $51.8 billion and $5.1 billion, respectively, at December 31, 2004, compared to $53.0 billion and $5.0 billion, respectively, at September 30, 2004. There were approximately 170 million shares outstanding at December 31, 2004, compared to approximately 171 million shares outstanding at September 30, 2004. In the fourth quarter of 2004, approximately 500,000 shares were repurchased in the open market for $34 million. Comerica’s fourth quarter 2004 estimated tier 1 common, tier 1 and total risk-based capital ratios were 8.14 percent, 8.78 percent and 12.72 percent, respectively.
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COMERICA REPORTS FOURTH QUARTER AND 2004 EARNINGS - 3
Conference Call and Webcast
Comerica will host a conference call to review fourth quarter and full-year 2004 financial results at 8 a.m. ET Thursday, January 20, 2005. Interested parties may access the conference call by calling (706) 679-5261 (event ID No. 2941511). The call and supplemental financial information can also be accessed via a Webcast at www.comerica.com. A replay of the conference call will be available approximately two hours following the call through Sunday, February 20, 2005. The conference call replay can be accessed by calling (800) 642-1687 or (706) 645-9291 (event ID No. 2941511). A replay of the Webcast can also be accessed via Comerica’s “Investor Relations” page at www.comerica.com.
Comerica Incorporated is a financial services company headquartered in Detroit, strategically aligned into three major lines of business: the Business Bank, Small Business & Personal Financial Services, and Wealth & Institutional Management. Comerica focuses on relationships and helping businesses and people to be successful. To receive e-mail alerts of breaking Comerica news, go to www.comerica.com/newsalerts.
Forward-looking Statement
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 “expect,” “believe,” “anticipate,” “intend,” “estimate,” “project,” “plan,” “outlook,” “may,” “could,” “would” and similar expressions 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 the pace of an economic recovery and related changes in employment levels, the effects of war and other armed conflicts or acts of terrorism, implementation of Comerica’s strategies and business models, management’s ability to maintain and expand customer relationships, changes in the accounting treatment of any particular item, the impact of regulatory examinations, changes in the businesses or industries in which Comerica has a concentration of loans, the anticipated performance of any new banking branches, the entry of new competitors in Comerica’s markets, changes in the level of fee income, changes in applicable laws and regulations, including those concerning taxes, banking, securities and insurance, changes in trade, monetary and fiscal policies, including the interest rate policies of the Board of Governors of the Federal Reserve System, fluctuations in inflation or interest rates, changes in general economic conditions and related credit and market conditions and adverse conditions in the stock market. Comerica cautions that the foregoing list of factors is not exclusive. 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 Contacts: | Investor Contact: | |
Sharon R. McMurray | Helen L. Arsenault | |
(313) 222-4881 | (313) 222-2840 | |
Wayne J. Mielke | ||
(313) 222-4732 |
CONSOLIDATED FINANCIAL HIGHLIGHTS
Comerica Incorporated and Subsidiaries
Three Months Ended | Years Ended | |||||||||||||||||||
December 31, | September 30, | December 31, | December 31, | |||||||||||||||||
(in millions, except per share data) | 2004 | 2004 | 2003 | 2004 | 2003 | |||||||||||||||
PER SHARE AND COMMON STOCK DATA | ||||||||||||||||||||
Diluted net income | $ | 1.21 | $ | 1.13 | $ | 0.89 | $ | 4.36 | $ | 3.75 | ||||||||||
Cash dividends declared | 0.52 | 0.52 | 0.50 | 2.08 | 2.00 | |||||||||||||||
Common shareholders’ equity (at period end) | 29.94 | 29.52 | 29.20 | |||||||||||||||||
Average diluted shares (in thousands) | 172,224 | 172,864 | 176,559 | 173,816 | 176,222 | |||||||||||||||
KEY RATIOS | ||||||||||||||||||||
Return on average common shareholders’ equity | 16.39 | % | 15.68 | % | 12.33 | % | 15.03 | % | 13.12 | % | ||||||||||
Return on average assets | 1.63 | 1.55 | 1.22 | 1.49 | 1.25 | |||||||||||||||
Average common shareholders’ equity as a percentage of average assets | 9.93 | 9.91 | 9.92 | 9.90 | 9.50 | |||||||||||||||
Tier 1 common capital ratio * | 8.14 | 8.16 | 8.04 | |||||||||||||||||
Tier 1 risk-based capital ratio * | 8.78 | 8.81 | 8.72 | |||||||||||||||||
Total risk-based capital ratio * | 12.72 | 13.06 | 12.71 | |||||||||||||||||
Leverage ratio * | 10.41 | 10.28 | 10.13 | |||||||||||||||||
AVERAGE BALANCES | ||||||||||||||||||||
Commercial loans (1) | $ | 22,563 | $ | 22,096 | $ | 22,190 | $ | 22,139 | $ | 23,764 | ||||||||||
Real estate construction loans | 3,178 | 3,273 | 3,500 | 3,264 | 3,540 | |||||||||||||||
Commercial mortgage loans | 7,999 | 7,951 | 7,727 | 7,991 | 7,521 | |||||||||||||||
Residential mortgage loans (1) | 1,275 | 1,239 | 1,232 | 1,237 | 1,192 | |||||||||||||||
Consumer loans (1) | 2,721 | 2,671 | 2,539 | 2,668 | 2,474 | |||||||||||||||
Lease financing | 1,259 | 1,266 | 1,290 | 1,272 | 1,283 | |||||||||||||||
International loans | 2,134 | 2,149 | 2,406 | 2,162 | 2,596 | |||||||||||||||
Total loans | $ | 41,129 | $ | 40,645 | $ | 40,884 | $ | 40,733 | $ | 42,370 | ||||||||||
Earning assets | 47,018 | 46,426 | 47,481 | 46,975 | 48,841 | |||||||||||||||
Total assets | 51,116 | 50,348 | 51,385 | 50,948 | 52,980 | |||||||||||||||
Interest-bearing deposits | 25,572 | 25,722 | 27,131 | 26,023 | 27,609 | |||||||||||||||
Total interest-bearing liabilities | 30,192 | 30,435 | 32,237 | 30,838 | 33,233 | |||||||||||||||
Noninterest-bearing deposits | 14,755 | 14,012 | 13,198 | 14,122 | 13,910 | |||||||||||||||
Common shareholders’ equity | 5,077 | 4,990 | 5,100 | 5,041 | 5,033 | |||||||||||||||
NET INTEREST INCOME | ||||||||||||||||||||
Net interest income (fully taxable equivalent basis) | $ | 467 | $ | 452 | $ | 458 | $ | 1,813 | $ | 1,929 | ||||||||||
Fully taxable equivalent adjustment | 1 | 1 | 1 | 3 | 3 | |||||||||||||||
Net interest margin | 3.96 | % | 3.86 | % | 3.83 | % | 3.86 | % | 3.95 | % | ||||||||||
CREDIT QUALITY | ||||||||||||||||||||
Nonaccrual loans | $ | 312 | $ | 361 | $ | 507 | ||||||||||||||
Other real estate | 27 | 27 | 30 | |||||||||||||||||
Nonaccrual debt securities | — | — | 1 | |||||||||||||||||
Total nonperforming assets | 339 | 388 | 538 | |||||||||||||||||
Loans 90 days past due and still accruing | 15 | 20 | 32 | |||||||||||||||||
Gross charge-offs | 55 | 53 | 97 | $ | 268 | $ | 408 | |||||||||||||
Recoveries | 20 | 20 | 21 | 74 | 43 | |||||||||||||||
Net charge-offs | 35 | 33 | 76 | 194 | 365 | |||||||||||||||
Allowance for loan losses as a percentage of total loans | 1.65 | % | 1.83 | % | 1.99 | % | ||||||||||||||
Net loans charged off as a percentage of average total loans | 0.34 | 0.33 | 0.75 | 0.48 | % | 0.86 | % | |||||||||||||
Nonperforming assets as a percentage of total loans, other real estate and nonaccrual debt securities | 0.83 | 0.98 | 1.33 | |||||||||||||||||
Allowance for loan losses as a percentage of total nonperforming assets | 198 | 188 | 149 | |||||||||||||||||
ADDITIONAL DATA | ||||||||||||||||||||
Goodwill | $ | 247 | $ | 247 | $ | 247 | ||||||||||||||
Core deposit intangible | — | — | 1 | |||||||||||||||||
Other intangibles | 1 | 1 | 1 | |||||||||||||||||
Loan servicing rights | 20 | 20 | 17 | |||||||||||||||||
Deferred mutual fund distribution costs | 8 | 9 | 12 | |||||||||||||||||
Amortization of intangibles | — | — | 1 | $ | 1 | $ | 1 | |||||||||||||
(1) Loans to individuals associated with commercial lending relationships were reclassified from commercial loans to residential mortgage loans and consumer loans in the second quarter of 2004. Prior periods have been reclassified.
* December 31, 2004 ratios are estimated
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CONSOLIDATED BALANCE SHEETS
Comerica Incorporated and Subsidiaries
December 31, | September 30, | December 31, | ||||||||||
(in millions , except share data) | 2004 | 2004 | 2003 | |||||||||
ASSETS | ||||||||||||
Cash and due from banks | $ | 1,139 | $ | 1,560 | $ | 1,527 | ||||||
Short-term investments | 3,230 | 5,055 | 4,013 | |||||||||
Investment securities available-for-sale | 3,943 | 4,198 | 4,489 | |||||||||
Commercial loans | 22,039 | 21,146 | 21,579 | |||||||||
Real estate construction loans | 3,053 | 3,276 | 3,397 | |||||||||
Commercial mortgage loans | 8,236 | 7,931 | 7,878 | |||||||||
Residential mortgage loans | 1,294 | 1,263 | 1,228 | |||||||||
Consumer loans | 2,751 | 2,722 | 2,610 | |||||||||
Lease financing | 1,265 | 1,260 | 1,301 | |||||||||
International loans | 2,205 | 2,117 | 2,309 | |||||||||
Total loans | 40,843 | 39,715 | 40,302 | |||||||||
Less allowance for loan losses | (673 | ) | (729 | ) | (803 | ) | ||||||
Net loans | 40,170 | 38,986 | 39,499 | |||||||||
Premises and equipment | 415 | 399 | 374 | |||||||||
Customers’ liability on acceptances outstanding | 57 | 41 | 27 | |||||||||
Accrued income and other assets | 2,812 | 2,720 | 2,663 | |||||||||
Total assets | $ | 51,766 | $ | 52,959 | $ | 52,592 | ||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||||||
Noninterest-bearing deposits | $ | 15,164 | $ | 16,811 | $ | 14,104 | ||||||
Interest-bearing deposits | 25,772 | 25,424 | 27,359 | |||||||||
Total deposits | 40,936 | 42,235 | 41,463 | |||||||||
Short-term borrowings | 193 | 225 | 262 | |||||||||
Acceptances outstanding | 57 | 41 | 27 | |||||||||
Accrued expenses and other liabilities | 1,189 | 1,021 | 929 | |||||||||
Medium- and long-term debt | 4,286 | 4,401 | 4,801 | |||||||||
Total liabilities | 46,661 | 47,923 | 47,482 | |||||||||
Common stock - $5 par value: | ||||||||||||
Authorized - 325,000,000 shares Issued - 178,735,252 shares at 12/31/04, 9/30/04 and 12/31/03 | 894 | 894 | 894 | |||||||||
Capital surplus | 421 | 408 | 384 | |||||||||
Accumulated other comprehensive income (loss) | (69 | ) | (24 | ) | 74 | |||||||
Retained earnings | 4,331 | 4,222 | 3,973 | |||||||||
Less cost of common stock in treasury - 8,259,328 shares at 12/31/04, 8,169,292 shares at 9/30/04 and 3,735,163 shares at 12/31/03 | (472 | ) | (464 | ) | (215 | ) | ||||||
Total shareholders’ equity | 5,105 | 5,036 | 5,110 | |||||||||
Total liabilities and shareholders’ equity | $ | 51,766 | $ | 52,959 | $ | 52,592 | ||||||
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CONSOLIDATED STATEMENTS OF INCOME
Comerica Incorporated and Subsidiaries
Three Months Ended | Years Ended | |||||||||||||||
December 31, | December 31, | |||||||||||||||
(in millions, except per share data) | 2004 | 2003 | 2004 | 2003 | ||||||||||||
INTEREST INCOME | ||||||||||||||||
Interest and fees on loans | $ | 544 | $ | 511 | $ | 2,054 | $ | 2,211 | ||||||||
Interest on investment securities | 36 | 41 | 147 | 165 | ||||||||||||
Interest on short-term investments | 11 | 8 | 36 | 36 | ||||||||||||
Total interest income | 591 | 560 | 2,237 | 2,412 | ||||||||||||
INTEREST EXPENSE | ||||||||||||||||
Interest on deposits | 91 | 77 | 315 | 370 | ||||||||||||
Interest on short-term borrowings | 2 | 1 | 4 | 7 | ||||||||||||
Interest on medium- and long-term debt | 32 | 25 | 108 | 109 | ||||||||||||
Total interest expense | 125 | 103 | 427 | 486 | ||||||||||||
Net interest income | 466 | 457 | 1,810 | 1,926 | ||||||||||||
Provision for loan losses | (21 | ) | 77 | 64 | 377 | |||||||||||
Net interest income after provision for loan losses | 487 | 380 | 1,746 | 1,549 | ||||||||||||
NONINTEREST INCOME | ||||||||||||||||
Service charges on deposit accounts | 53 | 59 | 231 | 238 | ||||||||||||
Fiduciary income | 43 | 44 | 171 | 169 | ||||||||||||
Commercial lending fees | 14 | 17 | 55 | 63 | ||||||||||||
Letter of credit fees | 17 | 16 | 66 | 65 | ||||||||||||
Foreign exchange income | 9 | 6 | 37 | 36 | ||||||||||||
Brokerage fees | 9 | 10 | 36 | 34 | ||||||||||||
Investment advisory revenue, net | 9 | 8 | 35 | 30 | ||||||||||||
Card fees | 9 | 7 | 32 | 27 | ||||||||||||
Bank-owned life insurance | 6 | 9 | 34 | 42 | ||||||||||||
Equity in earnings of unconsolidated subsidiaries | 1 | 1 | 12 | 6 | ||||||||||||
Warrant income | 1 | 3 | 7 | 4 | ||||||||||||
Net securities gains | — | 4 | — | 50 | ||||||||||||
Net gain on sales of businesses | — | — | 7 | — | ||||||||||||
Other noninterest income | 32 | 36 | 134 | 123 | ||||||||||||
Total noninterest income | 203 | 220 | 857 | 887 | ||||||||||||
NONINTEREST EXPENSES | ||||||||||||||||
Salaries and employee benefits | 233 | 227 | 919 | 897 | ||||||||||||
Net occupancy expense | 32 | 32 | 125 | 128 | ||||||||||||
Equipment expense | 15 | 15 | 58 | 61 | ||||||||||||
Outside processing fee expense | 17 | 18 | 68 | 71 | ||||||||||||
Software expense | 12 | 9 | 43 | 37 | ||||||||||||
Customer services | 6 | 7 | 23 | 25 | ||||||||||||
Litigation and operational losses | (3 | ) | 4 | 24 | 18 | |||||||||||
Other noninterest expenses | 68 | 67 | 233 | 246 | ||||||||||||
Total noninterest expenses | 380 | 379 | 1,493 | 1,483 | ||||||||||||
Income before income taxes | 310 | 221 | 1,110 | 953 | ||||||||||||
Provision for income taxes | 103 | 63 | 353 | 292 | ||||||||||||
NET INCOME | $ | 207 | $ | 158 | $ | 757 | $ | 661 | ||||||||
Basic net income per common share | $ | 1.22 | $ | 0.90 | $ | 4.41 | $ | 3.78 | ||||||||
Diluted net income per common share | 1.21 | 0.89 | 4.36 | 3.75 | ||||||||||||
Cash dividends declared on common stock | 88 | 88 | 356 | 350 | ||||||||||||
Dividends per common share | 0.52 | 0.50 | 2.08 | 2.00 | ||||||||||||
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CONSOLIDATED QUARTERLY STATEMENTS OF INCOME
Comerica Incorporated and Subsidiaries
Fourth | Third | Second | First | Fourth | Fourth Quarter 2004 Compared To: | |||||||||||||||||||||||||||||||
Quarter | Quarter | Quarter | Quarter | Quarter | Third Quarter 2004 | Fourth Quarter 2003 | ||||||||||||||||||||||||||||||
(in millions, except per share data) | 2004 | 2004 | 2004 | 2004 | 2003 | Amount | Percent | Amount | Percent | |||||||||||||||||||||||||||
INTEREST INCOME | ||||||||||||||||||||||||||||||||||||
Interest and fees on loans | $ | 544 | $ | 514 | $ | 500 | $ | 496 | $ | 511 | $ | 30 | 5.9 | % | $ | 33 | 6.6 | % | ||||||||||||||||||
Interest on investment securities | 36 | 36 | 35 | 40 | 41 | — | 0.1 | (5 | ) | (15.1 | ) | |||||||||||||||||||||||||
Interest on short-term investments | 11 | 8 | 10 | 7 | 8 | 3 | 28.6 | 3 | 39.6 | |||||||||||||||||||||||||||
Total interest income | 591 | 558 | 545 | 543 | 560 | 33 | 5.9 | 31 | 5.4 | |||||||||||||||||||||||||||
INTEREST EXPENSE | ||||||||||||||||||||||||||||||||||||
Interest on deposits | 91 | 79 | 72 | 73 | 77 | 12 | 15.3 | 14 | 17.7 | |||||||||||||||||||||||||||
Interest on short-term borrowings | 2 | 1 | — | 1 | 1 | 1 | 51.0 | 1 | 56.1 | |||||||||||||||||||||||||||
Interest on medium- and long-term debt | 32 | 27 | 25 | 24 | 25 | 5 | 15.6 | 7 | 29.6 | |||||||||||||||||||||||||||
Total interest expense | 125 | 107 | 97 | 98 | 103 | 18 | 15.7 | 22 | 20.9 | |||||||||||||||||||||||||||
Net interest income | 466 | 451 | 448 | 445 | 457 | 15 | 3.6 | 9 | 2.0 | |||||||||||||||||||||||||||
Provision for loan losses | (21 | ) | — | 20 | 65 | 77 | (21 | ) | N/M | (98 | ) | (127.3 | ) | |||||||||||||||||||||||
Net interest income after provision for loan losses | 487 | 451 | 428 | 380 | 380 | 36 | 8.2 | 107 | 28.1 | |||||||||||||||||||||||||||
NONINTEREST INCOME | ||||||||||||||||||||||||||||||||||||
Service charges on deposit accounts | 53 | 57 | 59 | 62 | 59 | (4 | ) | (5.6 | ) | (6 | ) | (9.7 | ) | |||||||||||||||||||||||
Fiduciary income | 43 | 43 | 41 | 44 | 44 | — | 1.0 | (1 | ) | (1.4 | ) | |||||||||||||||||||||||||
Commercial lending fees | 14 | 14 | 13 | 14 | 17 | — | (12.4 | ) | (3 | ) | (21.9 | ) | ||||||||||||||||||||||||
Letter of credit fees | 17 | 17 | 17 | 15 | 16 | — | (2.4 | ) | 1 | 2.4 | ||||||||||||||||||||||||||
Foreign exchange income | 9 | 9 | 10 | 9 | 6 | — | 8.8 | 3 | 42.2 | |||||||||||||||||||||||||||
Brokerage fees | 9 | 9 | 8 | 10 | 10 | — | 6.5 | (1 | ) | (0.3 | ) | |||||||||||||||||||||||||
Investment advisory revenue, net | 9 | 8 | 9 | 9 | 8 | 1 | 12.0 | 1 | 11.5 | |||||||||||||||||||||||||||
Card fees | 9 | 8 | 8 | 7 | 7 | 1 | 8.2 | 2 | 31.4 | |||||||||||||||||||||||||||
Bank-owned life insurance | 6 | 10 | 9 | 9 | 9 | (4 | ) | (31.1 | ) | (3 | ) | (26.2 | ) | |||||||||||||||||||||||
Equity in earnings of unconsolidated subsidiaries | 1 | 3 | 5 | 3 | 1 | (2 | ) | (56.4 | ) | — | 26.6 | |||||||||||||||||||||||||
Warrant income | 1 | 1 | 4 | 1 | 3 | — | 0.1 | (2 | ) | (54.2 | ) | |||||||||||||||||||||||||
Net securities gains (losses) | — | (6 | ) | 1 | 5 | 4 | 6 | N/M | (4 | ) | (95.3 | ) | ||||||||||||||||||||||||
Net gain on sales of businesses | — | — | 7 | — | — | — | N/M | — | — | |||||||||||||||||||||||||||
Other noninterest income | 32 | 33 | 37 | 32 | 36 | (1 | ) | (5.0 | ) | (4 | ) | (14.1 | ) | |||||||||||||||||||||||
Total noninterest income | 203 | 206 | 228 | 220 | 220 | (3 | ) | (1.3 | ) | (17 | ) | (7.6 | ) | |||||||||||||||||||||||
NONINTEREST EXPENSES | ||||||||||||||||||||||||||||||||||||
Salaries and employee benefits | 233 | 225 | 235 | 226 | 227 | 8 | 3.6 | 6 | 2.5 | |||||||||||||||||||||||||||
Net occupancy expense | 32 | 32 | 31 | 30 | 32 | — | 4.4 | — | 3.2 | |||||||||||||||||||||||||||
Equipment expense | 15 | 14 | 14 | 15 | 15 | 1 | 2.5 | — | (1.6 | ) | ||||||||||||||||||||||||||
Outside processing fee expense | 17 | 16 | 18 | 17 | 18 | 1 | 3.3 | (1 | ) | (5.7 | ) | |||||||||||||||||||||||||
Software expense | 12 | 11 | 9 | 11 | 9 | 1 | 11.7 | 3 | 21.7 | |||||||||||||||||||||||||||
Customer services | 6 | 8 | 7 | 2 | 7 | (2 | ) | (33.2 | ) | (1 | ) | (24.9 | ) | |||||||||||||||||||||||
Litigation and operational losses | (3 | ) | 16 | 3 | 8 | 4 | (19 | ) | (121.4 | ) | (7 | ) | (179.5 | ) | ||||||||||||||||||||||
Other noninterest expenses | 68 | 50 | 55 | 60 | 67 | 18 | 38.7 | 1 | 3.1 | |||||||||||||||||||||||||||
Total noninterest expenses | 380 | 372 | 372 | 369 | 379 | 8 | 2.2 | 1 | — | |||||||||||||||||||||||||||
Income before income taxes | 310 | 285 | 284 | 231 | 221 | 25 | 9.3 | 89 | 40.9 | |||||||||||||||||||||||||||
Provision for income taxes | 103 | 89 | 92 | 69 | 63 | 14 | 15.7 | 40 | 62.3 | |||||||||||||||||||||||||||
NET INCOME | $ | 207 | $ | 196 | $ | 192 | $ | 162 | $ | 158 | $ | 11 | 6.3 | % | $ | 49 | 32.3 | % | ||||||||||||||||||
Basic net income per common share | $ | 1.22 | $ | 1.15 | $ | 1.11 | $ | 0.93 | $ | 0.90 | $ | 0.07 | 6.1 | % | $ | 0.32 | 35.6 | % | ||||||||||||||||||
Diluted net income per common share | 1.21 | 1.13 | 1.10 | 0.92 | 0.89 | 0.08 | 7.1 | 0.32 | 36.0 | |||||||||||||||||||||||||||
Cash dividends declared on common stock | 88 | 88 | 90 | 90 | 88 | — | (0.3 | ) | — | 0.5 | ||||||||||||||||||||||||||
Dividends per common share | 0.52 | 0.52 | 0.52 | 0.52 | 0.50 | — | — | 0.02 | 4.0 | |||||||||||||||||||||||||||
N/M – Not meaningful
-7-
ANALYSIS OF THE ALLOWANCE FOR LOAN LOSSES
Comerica Incorporated and Subsidiaries
2004 | 2003 | |||||||||||||||||||
(in millions) | 4th Qtr | 3rd Qtr | 2nd Qtr | 1st Qtr | 4th Qtr | |||||||||||||||
Balance at beginning of period | $ | 729 | $ | 762 | $ | 798 | $ | 803 | $ | 802 | ||||||||||
Loans charged-off: | ||||||||||||||||||||
Commercial | 39 | 41 | 57 | 64 | 74 | |||||||||||||||
Real estate construction: | ||||||||||||||||||||
Real estate construction business line | — | 1 | 1 | — | 1 | |||||||||||||||
Other | — | — | — | — | — | |||||||||||||||
Total real estate construction | — | 1 | 1 | — | 1 | |||||||||||||||
Commercial mortgage: | ||||||||||||||||||||
Commercial real estate business line | 4 | — | — | — | — | |||||||||||||||
Other | — | 7 | 6 | 6 | 6 | |||||||||||||||
Total commercial mortgage | 4 | 7 | 6 | 6 | 6 | |||||||||||||||
Residential mortgage | — | 1 | — | — | — | |||||||||||||||
Consumer | 5 | 2 | 4 | 3 | 3 | |||||||||||||||
Lease financing | 4 | — | 1 | 8 | — | |||||||||||||||
International | 3 | 1 | 7 | 3 | 13 | |||||||||||||||
Total loans charged-off | 55 | 53 | 76 | 84 | 97 | |||||||||||||||
Recoveries on loans previously charged-off: | ||||||||||||||||||||
Commercial | 14 | 13 | 15 | 10 | 16 | |||||||||||||||
Real estate construction | — | — | — | — | — | |||||||||||||||
Commercial mortgage | 1 | 1 | 1 | — | — | |||||||||||||||
Residential mortgage | — | — | — | — | — | |||||||||||||||
Consumer | — | 1 | 1 | — | — | |||||||||||||||
Lease financing | — | — | — | 1 | — | |||||||||||||||
International | 5 | 5 | 3 | 3 | 5 | |||||||||||||||
Total recoveries | 20 | 20 | 20 | 14 | 21 | |||||||||||||||
Net loans charged-off | 35 | 33 | 56 | 70 | 76 | |||||||||||||||
Provision for loan losses | (21 | ) | — | 20 | 65 | 77 | ||||||||||||||
Balance at end of period | $ | 673 | $ | 729 | $ | 762 | $ | 798 | $ | 803 | ||||||||||
Allowance for loan losses as a percentage of total loans | 1.65 | % | 1.83 | % | 1.90 | % | 1.99 | % | 1.99 | % | ||||||||||
Net loans charged-off as a percentage of average total loans | 0.34 | 0.33 | 0.55 | 0.69 | 0.75 | |||||||||||||||
Allowance for credit losses on lending-related commitments* | $ | 21 | $ | 24 | $ | 28 | $ | 32 | $ | 33 | ||||||||||
* Included in “Accrued expenses and other liabilities” on the consolidated balance sheets.
-8-
NONPERFORMING ASSETS
Comerica Incorporated and Subsidiaries
2004 | 2003 | |||||||||||||||||||
(in millions) | 4th Qtr | 3rd Qtr | 2nd Qtr | 1st Qtr | 4th Qtr | |||||||||||||||
SUMMARY OF NONPERFORMING ASSETS AND PAST DUE LOANS | ||||||||||||||||||||
Nonaccrual loans: | ||||||||||||||||||||
Commercial | $ | 161 | $ | 181 | $ | 229 | $ | 282 | $ | 295 | ||||||||||
Real estate construction: | ||||||||||||||||||||
Real estate construction business line | 31 | 28 | 20 | 19 | 21 | |||||||||||||||
Other | 3 | 3 | 3 | 5 | 3 | |||||||||||||||
Total real estate construction | 34 | 31 | 23 | 24 | 24 | |||||||||||||||
Commercial mortgage: | ||||||||||||||||||||
Commercial real estate business line | 6 | 10 | 12 | 3 | 3 | |||||||||||||||
Other | 58 | 70 | 80 | 90 | 84 | |||||||||||||||
Total commercial mortgage | 64 | 80 | 92 | 93 | 87 | |||||||||||||||
Residential mortgage | 1 | 1 | 3 | 4 | 2 | |||||||||||||||
Consumer | 1 | 2 | 2 | 5 | 7 | |||||||||||||||
Lease financing | 15 | 19 | 13 | 13 | 24 | |||||||||||||||
International | 36 | 47 | 42 | 68 | 68 | |||||||||||||||
Total nonaccrual loans | 312 | 361 | 404 | 489 | 507 | |||||||||||||||
Reduced-rate loans | — | — | — | — | — | |||||||||||||||
Total nonperforming loans | 312 | 361 | 404 | 489 | 507 | |||||||||||||||
Other real estate | 27 | 27 | 26 | 32 | 30 | |||||||||||||||
Nonaccrual debt securities | — | — | — | 1 | 1 | |||||||||||||||
Total nonperforming assets | $ | 339 | $ | 388 | $ | 430 | $ | 522 | $ | 538 | ||||||||||
Nonperforming loans as a percentage of total loans | 0.76 | % | 0.91 | % | 1.01 | % | 1.22 | % | 1.26 | % | ||||||||||
Nonperforming assets as a percentage of total loans, other real estate and nonaccrual debt securities | 0.83 | 0.98 | 1.07 | 1.30 | 1.33 | |||||||||||||||
Allowance for loan losses as a percentage of total nonperforming assets | 198 | 188 | 177 | 153 | 149 | |||||||||||||||
Loans past due 90 days or more and still accruing | $ | 15 | $ | 20 | $ | 25 | $ | 35 | $ | 32 | ||||||||||
ANALYSIS OF NONACCRUAL LOANS | ||||||||||||||||||||
Nonaccrual loans at beginning of period | $ | 361 | $ | 404 | $ | 489 | $ | 507 | $ | 598 | ||||||||||
Loans transferred to nonaccrual (1) | 71 | 106 | 63 | 92 | 114 | |||||||||||||||
Nonaccrual business loan gross charge-offs (2) | (49 | ) | (48 | ) | (71 | ) | (80 | ) | (93 | ) | ||||||||||
Loans transferred to accrual status (1) | (7 | ) | — | — | — | — | ||||||||||||||
Nonaccrual business loans sold (3) | (33 | ) | (16 | ) | (33 | ) | (14 | ) | (48 | ) | ||||||||||
Payments/Other (4) | (31 | ) | (85 | ) | (44 | ) | (16 | ) | (64 | ) | ||||||||||
Nonaccrual loans at end of period | $ | 312 | $ | 361 | $ | 404 | $ | 489 | $ | 507 | ||||||||||
(1) Based on an analysis of nonaccrual loans with book balances greater than $2 million. | ||||||||||||||||||||
(2) Analysis of gross loan charge-offs: | ||||||||||||||||||||
Nonaccrual business loans | $ | 49 | $ | 48 | $ | 71 | $ | 80 | $ | 93 | ||||||||||
Performing watch list loans | 1 | 2 | 1 | 1 | �� | 1 | ||||||||||||||
Consumer loans | 5 | 3 | 4 | 3 | 3 | |||||||||||||||
Total gross loan charge-offs | $ | 55 | $ | 53 | $ | 76 | $ | 84 | $ | 97 | ||||||||||
(3) Analysis of loans sold: | ||||||||||||||||||||
Nonaccrual business loans | $ | 33 | $ | 16 | $ | 33 | $ | 14 | $ | 48 | ||||||||||
Performing watch list loans | 7 | 30 | 14 | 18 | 15 | |||||||||||||||
Total loans sold | $ | 40 | $ | 46 | $ | 47 | $ | 32 | $ | 63 | ||||||||||
(4) Net change related to nonaccrual loans with balances less than $2 million, other than business loan gross charge-offs and nonaccrual loans sold, are included in Payments/Other. |
-9-
ANALYSIS OF NET INTEREST INCOME (FTE)
Comerica Incorporated and Subsidiaries
Three Months Ended | ||||||||||||||||||||||||||||||||||||
December 31, 2004 | September 30, 2004 | December 31, 2003 | ||||||||||||||||||||||||||||||||||
Average | Average | Average | Average | Average | Average | |||||||||||||||||||||||||||||||
(dollar amounts in millions) | Balance | Interest | Rate | Balance | Interest | Rate | Balance | Interest | Rate | |||||||||||||||||||||||||||
Commercial loans | $ | 22,563 | $ | 265 | 4.66 | % | $ | 22,096 | $ | 234 | 4.21 | % | $ | 22,190 | $ | 227 | 4.07 | % | ||||||||||||||||||
Real estate construction loans | 3,178 | 48 | 5.99 | 3,273 | 46 | 5.58 | 3,500 | 44 | 5.00 | |||||||||||||||||||||||||||
Commercial mortgage loans | 7,999 | 111 | 5.53 | 7,951 | 104 | 5.22 | 7,727 | 100 | 5.11 | |||||||||||||||||||||||||||
Residential mortgage loans | 1,275 | 18 | 5.59 | 1,239 | 18 | 5.63 | 1,232 | 18 | 5.84 | |||||||||||||||||||||||||||
Consumer loans | 2,721 | 34 | 5.04 | 2,671 | 31 | 4.68 | 2,539 | 27 | 4.31 | |||||||||||||||||||||||||||
Lease financing | 1,259 | 13 | 4.09 | 1,266 | 11 | 3.46 | 1,290 | 15 | 4.58 | |||||||||||||||||||||||||||
International loans | 2,134 | 29 | 5.40 | 2,149 | 26 | 4.87 | 2,406 | 26 | 4.36 | |||||||||||||||||||||||||||
Business loan swap income | — | 28 | — | — | 45 | — | — | 54 | — | |||||||||||||||||||||||||||
Total loans | 41,129 | 546 | 5.28 | 40,645 | 515 | 5.04 | 40,884 | 511 | 4.97 | |||||||||||||||||||||||||||
Investment securities available-for-sale (1) | 4,052 | 35 | 3.48 | 4,225 | 36 | 3.31 | 4,792 | 42 | 3.47 | |||||||||||||||||||||||||||
Short-term investments | 1,837 | 11 | 2.36 | 1,556 | 8 | 2.17 | 1,805 | 8 | 1.72 | |||||||||||||||||||||||||||
Total earning assets | 47,018 | 592 | 5.01 | 46,426 | 559 | 4.78 | 47,481 | 561 | 4.69 | |||||||||||||||||||||||||||
Cash and due from banks | 1,698 | 1,652 | 1,703 | |||||||||||||||||||||||||||||||||
Allowance for loan losses | (731 | ) | (774 | ) | (832 | ) | ||||||||||||||||||||||||||||||
Accrued income and other assets | 3,131 | 3,044 | 3,033 | |||||||||||||||||||||||||||||||||
Total assets | $ | 51,116 | $ | 50,348 | $ | 51,385 | ||||||||||||||||||||||||||||||
Money market and NOW deposits | $ | 17,755 | 57 | 1.27 | $ | 17,526 | 47 | 1.06 | $ | 17,991 | 44 | 0.98 | ||||||||||||||||||||||||
Savings deposits | 1,605 | 2 | 0.41 | 1,652 | 1 | 0.36 | 1,592 | 2 | 0.42 | |||||||||||||||||||||||||||
Certificates of deposit | 5,520 | 28 | 2.01 | 5,826 | 26 | 1.79 | 6,991 | 28 | 1.58 | |||||||||||||||||||||||||||
Foreign office time deposits | 692 | 5 | 2.99 | 718 | 5 | 2.76 | 557 | 4 | 2.62 | |||||||||||||||||||||||||||
Total interest-bearing deposits | 25,572 | 92 | 1.42 | 25,722 | 79 | 1.22 | 27,131 | 78 | 1.13 | |||||||||||||||||||||||||||
Short-term borrowings | 278 | 1 | 1.85 | 251 | 1 | 1.36 | 334 | 1 | 0.98 | |||||||||||||||||||||||||||
Medium- and long-term debt | 4,342 | 32 | 2.91 | 4,462 | 27 | 2.45 | 4,772 | 24 | 2.04 | |||||||||||||||||||||||||||
Total interest-bearing sources | 30,192 | 125 | 1.64 | 30,435 | 107 | 1.40 | 32,237 | 103 | 1.27 | |||||||||||||||||||||||||||
Noninterest-bearing deposits | 14,755 | 14,012 | 13,198 | |||||||||||||||||||||||||||||||||
Accrued expenses and other liabilities | 1,092 | 911 | 850 | |||||||||||||||||||||||||||||||||
Common shareholders’ equity | 5,077 | 4,990 | 5,100 | |||||||||||||||||||||||||||||||||
Total liabilities and shareholders’ equity | $ | 51,116 | $ | 50,348 | $ | 51,385 | ||||||||||||||||||||||||||||||
Net interest income/rate spread (FTE) | $ | 467 | 3.37 | $ | 452 | 3.38 | $ | 458 | 3.42 | |||||||||||||||||||||||||||
FTE adjustment | $ | 1 | $ | 1 | $ | 1 | ||||||||||||||||||||||||||||||
Impact of net noninterest-bearing sources of funds | 0.59 | 0.48 | 0.41 | |||||||||||||||||||||||||||||||||
Net interest margin (as a percentage of average earning assets) (FTE) | 3.96 | % | 3.86 | % | 3.83 | % | ||||||||||||||||||||||||||||||
(1) The average rate for investment securities available-for-sale was computed using average historical cost.
-10-
ANALYSIS OF NET INTEREST INCOME (FTE)
Comerica Incorporated and Subsidiaries
Years Ended | |||||||||||||||||||||||||||
December 31, 2004 | December 31, 2003 | ||||||||||||||||||||||||||
Average | Average | Average | Average | ||||||||||||||||||||||||
(dollar amounts in millions) | Balance | Interest | Rate | Balance | Interest | Rate | |||||||||||||||||||||
Commercial loans | $ | 22,139 | $ | 933 | 4.22 | % | $ | 23,764 | $ | 978 | 4.11 | % | |||||||||||||||
Real estate construction loans | 3,264 | 177 | 5.43 | 3,540 | 178 | 5.04 | |||||||||||||||||||||
Commercial mortgage loans | 7,991 | 415 | 5.19 | 7,521 | 403 | 5.35 | |||||||||||||||||||||
Residential mortgage loans | 1,237 | 70 | 5.68 | 1,192 | 73 | 6.12 | |||||||||||||||||||||
Consumer loans | 2,668 | 126 | 4.73 | 2,474 | 122 | 4.94 | |||||||||||||||||||||
Lease financing | 1,272 | 52 | 4.06 | 1,283 | 59 | 4.59 | |||||||||||||||||||||
International loans | 2,162 | 102 | 4.69 | 2,596 | 115 | 4.44 | |||||||||||||||||||||
Business loan swap income | — | 182 | — | — | 285 | — | |||||||||||||||||||||
Total loans | 40,733 | 2,057 | 5.05 | 42,370 | 2,213 | 5.22 | |||||||||||||||||||||
Investment securities available-for-sale (1) | 4,321 | 147 | 3.36 | 4,529 | 166 | 3.65 | |||||||||||||||||||||
Short-term investments | 1,921 | 36 | 1.88 | 1,942 | 36 | 1.85 | |||||||||||||||||||||
Total earning assets | 46,975 | 2,240 | 4.76 | 48,841 | 2,415 | 4.94 | |||||||||||||||||||||
Cash and due from banks | 1,685 | 1,811 | |||||||||||||||||||||||||
Allowance for loan losses | (787 | ) | (831 | ) | |||||||||||||||||||||||
Accrued income and other assets | 3,075 | 3,159 | |||||||||||||||||||||||||
Total assets | $ | 50,948 | $ | 52,980 | |||||||||||||||||||||||
Money market and NOW deposits | $ | 17,768 | 188 | 1.06 | $ | 17,359 | 204 | 1.18 | |||||||||||||||||||
Savings deposits | 1,629 | 6 | 0.39 | 1,571 | 8 | 0.50 | |||||||||||||||||||||
Certificates of deposit | 5,962 | 104 | 1.74 | 8,061 | 139 | 1.72 | |||||||||||||||||||||
Foreign office time deposits | 664 | 17 | 2.60 | 618 | 19 | 3.15 | |||||||||||||||||||||
Total interest-bearing deposits | 26,023 | 315 | 1.21 | 27,609 | 370 | 1.34 | |||||||||||||||||||||
Short-term borrowings | 275 | 4 | 1.25 | 550 | 7 | 1.20 | |||||||||||||||||||||
Medium- and long-term debt | 4,540 | 108 | 2.39 | 5,074 | 109 | 2.14 | |||||||||||||||||||||
Total interest-bearing sources | 30,838 | 427 | 1.38 | 33,233 | 486 | 1.46 | |||||||||||||||||||||
Noninterest-bearing deposits | 14,122 | 13,910 | |||||||||||||||||||||||||
Accrued expenses and other liabilities | 947 | 804 | |||||||||||||||||||||||||
Common shareholders’ equity | 5,041 | 5,033 | |||||||||||||||||||||||||
Total liabilities and shareholders’ equity | $ | 50,948 | $ | 52,980 | |||||||||||||||||||||||
Net interest income/rate spread (FTE) | $ | 1,813 | 3.38 | $ | 1,929 | 3.48 | |||||||||||||||||||||
FTE adjustment | $ | 3 | $ | 3 | |||||||||||||||||||||||
Impact of net noninterest-bearing sources of funds | 0.48 | 0.47 | |||||||||||||||||||||||||
Net interest margin (as a percentage of average earning assets) (FTE) | 3.86 | % | 3.95 | % | |||||||||||||||||||||||
(1) The average rate for investment securities available-for-sale was computed using average historical cost.
-11-
CONSOLIDATED STATISTICAL DATA
Comerica Incorporated and Subsidiaries
December 31, | September 30, | June 30, | March 31, | December 31, | ||||||||||||||||
(in millions, except per share data) | 2004 | 2004 | 2004 | 2004 | 2003 | |||||||||||||||
Commercial loans (1): | ||||||||||||||||||||
Floor plan | $ | 2,575 | $ | 2,270 | $ | 2,802 | $ | 2,797 | $ | 2,731 | ||||||||||
Other | 19,464 | 18,876 | 18,656 | 18,704 | 18,848 | |||||||||||||||
Total commercial loans | 22,039 | 21,146 | 21,458 | 21,501 | 21,579 | |||||||||||||||
Real estate construction loans: | ||||||||||||||||||||
Real estate construction business line | 2,461 | 2,641 | 2,661 | 2,628 | 2,754 | |||||||||||||||
Other | 592 | 635 | 621 | 615 | 643 | |||||||||||||||
Total real estate construction loans | 3,053 | 3,276 | 3,282 | 3,243 | 3,397 | |||||||||||||||
Commercial mortgage loans: | ||||||||||||||||||||
Commercial real estate business line | 1,556 | 1,498 | 1,656 | 1,718 | 1,655 | |||||||||||||||
Other | 6,680 | 6,433 | 6,424 | 6,311 | 6,223 | |||||||||||||||
Total commercial mortgage loans | 8,236 | 7,931 | 8,080 | 8,029 | 7,878 | |||||||||||||||
Residential mortgage loans (1) | 1,294 | 1,263 | 1,211 | 1,210 | 1,228 | |||||||||||||||
Consumer loans (1): | ||||||||||||||||||||
Home equity | 1,837 | 1,815 | 1,788 | 1,657 | 1,647 | |||||||||||||||
Other consumer | 914 | 907 | 884 | 969 | 963 | |||||||||||||||
Total consumer loans | 2,751 | 2,722 | 2,672 | 2,626 | 2,610 | |||||||||||||||
Lease financing | 1,265 | 1,260 | 1,266 | 1,268 | 1,301 | |||||||||||||||
International loans | 2,205 | 2,117 | 2,130 | 2,135 | 2,309 | |||||||||||||||
Total loans | $ | 40,843 | $ | 39,715 | $ | 40,099 | $ | 40,012 | $ | 40,302 | ||||||||||
(1) Loans to individuals associated with commercial lending relationships were reclassified from commercial loans (other) to residential mortgage loans and consumer loans (both home equity and other consumer) in the second quarter of 2004. Prior periods have been reclassified. | ||||||||||||||||||||
Goodwill | $ | 247 | $ | 247 | $ | 247 | $ | 247 | $ | 247 | ||||||||||
Core deposit intangible | — | — | — | 1 | 1 | |||||||||||||||
Other intangible assets | 1 | 1 | 1 | 1 | 1 | |||||||||||||||
Loan servicing rights | 20 | 20 | 19 | 18 | 17 | |||||||||||||||
Deferred mutual fund distribution costs | 8 | 9 | 10 | 11 | 12 | |||||||||||||||
Amortization of intangibles (quarterly) | — | — | 1 | — | 1 | |||||||||||||||
Tier 1 common capital ratio* | 8.14 | % | 8.16 | % | 8.00 | % | 8.00 | % | 8.04 | % | ||||||||||
Tier 1 risk-based capital ratio* | 8.78 | 8.81 | 8.64 | 8.64 | 8.72 | |||||||||||||||
Total risk-based capital ratio * | 12.72 | 13.06 | 12.91 | 12.60 | 12.71 | |||||||||||||||
Leverage ratio* | 10.41 | 10.28 | 9.97 | 10.15 | 10.13 | |||||||||||||||
Book value per share | $ | 29.94 | $ | 29.52 | $ | 28.75 | $ | 29.41 | $ | 29.20 | ||||||||||
Market value per share for the quarter: | ||||||||||||||||||||
High | $ | 63.80 | $ | 61.48 | $ | 56.99 | $ | 59.23 | $ | 56.34 | ||||||||||
Low | 57.81 | 53.00 | 50.45 | 52.30 | 46.38 | |||||||||||||||
Close | 61.02 | 59.35 | 54.88 | 54.32 | 56.06 | |||||||||||||||
Quarterly ratios: | ||||||||||||||||||||
Return on average common shareholders’ equity | 16.39 | % | 15.68 | % | 15.35 | % | 12.71 | % | 12.33 | % | ||||||||||
Return on average assets | 1.63 | 1.55 | 1.49 | 1.28 | 1.22 | |||||||||||||||
Efficiency ratio | 56.61 | 56.08 | 55.08 | 55.84 | 56.34 | |||||||||||||||
Number of banking offices | 376 | 364 | 361 | 362 | 360 | |||||||||||||||
Number of employees - full time equivalent | 10,968 | 10,919 | 11,111 | 11,237 | 11,282 | |||||||||||||||
* December 31, 2004 ratios are estimated
-12-
PARENT COMPANY ONLY BALANCE SHEETS
Comerica Incorporated
December 31, | September 30, | December 31, | ||||||||||
(in millions, except share data) | 2004 | 2004 | 2003 | |||||||||
ASSETS | ||||||||||||
Cash and due from banks | $ | 1 | $ | 1 | $ | — | ||||||
Short-term investments with subsidiary bank | 289 | 215 | 296 | |||||||||
Investment in subsidiaries, principally banks | 5,591 | 5,611 | 5,599 | |||||||||
Premises and equipment | 3 | 3 | 3 | |||||||||
Other assets | 304 | 294 | 262 | |||||||||
Total assets | $ | 6,188 | $ | 6,124 | $ | 6,160 | ||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||||||
Long-term debt | $ | 824 | $ | 827 | $ | 826 | ||||||
Other liabilities | 259 | 261 | 224 | |||||||||
Total liabilities | 1,083 | 1,088 | 1,050 | |||||||||
Common stock - - $5 par value: | ||||||||||||
Authorized - 325,000,000 shares Issued - 178,735,252 shares at 12/31/04, 9/30/04 and 12/31/03 | 894 | 894 | 894 | |||||||||
Capital surplus | 421 | 408 | 384 | |||||||||
Accumulated other comprehensive income | (69 | ) | (24 | ) | 74 | |||||||
Retained earnings | 4,331 | 4,222 | 3,973 | |||||||||
Less cost of common stock in treasury - 8,259,328 shares at 12/31/04, 8,169,292 shares at 9/30/04 and 3,735,163 shares at 12/31/03 | (472 | ) | (464 | ) | (215 | ) | ||||||
Total shareholders’ equity | 5,105 | 5,036 | 5,110 | |||||||||
Total liabilities and shareholders’ equity | $ | 6,188 | $ | 6,124 | $ | 6,160 | ||||||
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY
Comerica Incorporated and Subsidiaries
Accumulated | ||||||||||||||||||||||||
Other | Total | |||||||||||||||||||||||
Common | Capital | Comprehensive | Retained | Treasury | Shareholders’ | |||||||||||||||||||
(in millions, except share data) | Stock | Surplus | Income (Loss) | Earnings | Stock | Equity | ||||||||||||||||||
BALANCE AT JANUARY 1, 2003 | $ | 894 | $ | 363 | $ | 237 | $ | 3,684 | $ | (231 | ) | $ | 4,947 | |||||||||||
Net income | — | — | — | 661 | — | 661 | ||||||||||||||||||
Other comprehensive loss, net of tax | — | — | (163 | ) | — | — | (163 | ) | ||||||||||||||||
Total comprehensive income | 498 | |||||||||||||||||||||||
Cash dividends declared on common stock ($2.00 per share) | — | — | — | (350 | ) | — | (350 | ) | ||||||||||||||||
Purchase of 510,500 shares of common stock | — | — | — | — | (27 | ) | (27 | ) | ||||||||||||||||
Net issuance of common stock under employee stock plans | — | (5 | ) | — | (22 | ) | 43 | 16 | ||||||||||||||||
Recognition of stock-based compensation expense | — | 26 | — | — | — | 26 | ||||||||||||||||||
BALANCE AT DECEMBER 31, 2003 | $ | 894 | $ | 384 | $ | 74 | $ | 3,973 | $ | (215 | ) | $ | 5,110 | |||||||||||
BALANCE AT JANUARY 1, 2004 | $ | 894 | $ | 384 | $ | 74 | $ | 3,973 | $ | (215 | ) | $ | 5,110 | |||||||||||
Net income | — | — | — | 757 | — | 757 | ||||||||||||||||||
Other comprehensive loss, net of tax | — | — | (143 | ) | — | — | (143 | ) | ||||||||||||||||
Total comprehensive income | 614 | |||||||||||||||||||||||
Cash dividends declared on common stock ($2.08 per share) | — | — | — | (356 | ) | — | (356 | ) | ||||||||||||||||
Purchase of 6,526,911 shares of common stock | — | — | — | — | (370 | ) | (370 | ) | ||||||||||||||||
Net issuance of common stock under employee stock plans | — | 2 | — | (43 | ) | 113 | 72 | |||||||||||||||||
Recognition of stock-based compensation expense | — | 35 | — | — | — | 35 | ||||||||||||||||||
BALANCE AT DECEMBER 31, 2004 | $ | 894 | $ | 421 | $ | (69 | ) | $ | 4,331 | $ | (472 | ) | $ | 5,105 | ||||||||||
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