Exhibit 99.1
| NEWS RELEASE |
|
COMERICA REPORTS FIRST QUARTER 2009
NET INCOME OF $9 MILLION
Already Strong Capital Levels Further Enhanced
Average Core Deposits Increased $1 Billion
Management Continues Strong Focus on Expense Controls
EPS Impact of Preferred Stock Dividends to U.S. Treasury (22 Cents)
DALLAS/April 21, 2009 — Comerica Incorporated (NYSE: CMA) today reported first quarter 2009 net income of $9 million, compared to net income of $20 million for the fourth quarter 2008 and $109 million for the first quarter 2008. After preferred dividends of $33 million in the first quarter 2009 and $17 million in the fourth quarter 2008, the net loss applicable to common stock was $24 million, or $0.16 per diluted share, for the first quarter 2009, compared to net income applicable to common stock of $3 million, or $0.02 per diluted share, for the fourth quarter 2008 and $109 million, or $0.73 per diluted share, for the first quarter 2008. First quarter 2009 included a $203 million provision for loan losses, compared to $192 million for the fourth quarter 2008 and $159 million for the first quarter 2008.
(dollar amounts in millions, except per share data) |
| 1st Qtr ’09 |
| 4th Qtr ’08 |
| 1st Qtr ’08 |
| |||
Net interest income |
| $ | 384 |
| $ | 431 |
| $ | 476 |
|
Provision for loan losses |
| 203 |
| 192 |
| 159 |
| |||
Noninterest income |
| 223 |
| 174 |
| 237 |
| |||
Noninterest expenses |
| 397 |
| 411 |
| 403 |
| |||
Net income |
| 9 |
| 20 |
| 109 |
| |||
Preferred stock dividends to U.S. Treasury |
| 33 |
| 17 |
| — |
| |||
Net income (loss) applicable to common stock |
| (24 | ) | 3 |
| 109 |
| |||
Diluted earnings (loss) per common share |
| (0.16 | ) | 0.02 |
| 0.73 |
| |||
Tier 1 capital ratio |
| 11.08 | %* | 10.66 | % | 7.40 | % | |||
Tangible common equity ratio |
| 7.27 |
| 7.21 |
| 7.62 |
| |||
Net interest margin |
| 2.53 |
| 2.82 |
| 3.22 |
| |||
* March 31, 2009 ratio is estimated.
“We had $5.6 billion in new and renewed commitments in the first quarter, as we continued to focus our lending efforts on new and existing relationship customers, with the appropriate credit standards and return hurdles in place,” said Ralph W. Babb Jr., chairman and chief executive officer. “To support the challenged housing market, we also funded $2 billion in mortgage-backed government agency securities in the quarter.
“Commercial and industrial loan growth has slowed sharply in all 10 previous post-World War II recessions, with actual loan outstandings falling in eight of those recessions, in inflation-adjusted terms. Companies have reduced their borrowings out of appropriate caution during this recession, as well. As a result, we have seen reduced loan demand across our geographic markets.
- more -
COMERICA REPORTS FIRST QUARTER 2009 RESULTS
“The $33 million preferred stock dividends to the U.S. Treasury Department under the Capital Purchase Program weighed on our first quarter results, with an impact of 22 cents per share. We plan to redeem the $2.25 billion in preferred stock at such time as feasible, with careful consideration given to the economic environment.
“Our already strong capital levels were further enhanced in the first quarter, with a preliminary Tier 1 Capital ratio of 11.08 percent at March 31. The quality of our capital also continues to be solid, as evidenced by a Tier I Common capital ratio of 7.33 percent and a Tangible Common Equity ratio of 7.27 percent.
“We were pleased by the $1 billion increase in average core deposits. We are staying close to our customers throughout this economic cycle, delivering the exceptional service that has been a hallmark of our company for many years.
“Our expense controls included a workforce reduction of five percent in the first quarter, bringing us to a staffing level that is the lowest in more than 10 years, even with our investment in about 100 new banking centers since 2005. Together with other cost-savings actions, as well as our efforts to grow new and existing customer relationships, we believe we are well positioned to weather the economic downturn and for the future.”
First Quarter 2009 Compared to Fourth Quarter 2008
· Average earning assets increased $618 million, reflecting a $1.4 billion increase in investment securities, from purchases of mortgage-backed government agency securities in the first quarter 2009 and auction-rate securities repurchased from customers in the fourth quarter 2008, partially offset by a decrease in average loans.
· Average loans, excluding Financial Services Division (FSD) loans, were down $1.7 billion from the fourth quarter 2008. National Dealer Services average loans declined $461 million and Middle Market average loans declined in all markets. The declines reflected reduced demand from customers in a rapidly contracting economic environment.
· Average core deposits, excluding the Financial Services Division, increased $1.0 billion in the first quarter 2009, reflecting an $840 million increase in noninterest-bearing deposits.
· The net interest margin of 2.53 percent decreased 29 basis points, from 2.82 percent in the fourth quarter 2008, primarily reflecting the limited opportunity to reduce deposit rates and the decreased contribution of noninterest-bearing funds in a significantly lower rate environment, partially offset by increasing loan spreads.
· Net credit-related charge-offs were $157 million, or 1.26 percent of average total loans, for the first quarter 2009, compared to $133 million, or 1.04 percent of average total loans, for the fourth quarter 2008. The provision for loan losses was $203 million for the first quarter 2009, compared to $192 million for the fourth quarter 2008, and the period-end allowance to total loans ratio increased to 1.68 percent from 1.52 percent at December 31, 2008.
· Noninterest income increased $49 million, and included a $24 million pre-tax gain on the termination of certain structured lease transactions, $13 million of net securities gains (including gains of $5 million from redemptions of auction-rate securities) and $5 million in deferred compensation asset losses, a decrease in losses of $13 million when compared to the fourth quarter 2008 (offset by an increase in deferred compensation plan costs in noninterest expenses).
· Noninterest expenses decreased $14 million from the fourth quarter, primarily due to a $16 million decrease in salaries expense and targeted decreases across discretionary categories of noninterest expenses, partially offset by increases in pension expense ($11 million) and FDIC insurance expense ($8 million). Total severance-related expenses were $6 million in the first quarter, down from $29 million in the fourth quarter of 2008. Annualized first quarter noninterest expenses were nearly 10 percent lower than noninterest expenses for the full-year 2008.
· The estimated Tier 1 common and Tier 1 capital ratios were 7.33 percent and 11.08 percent, respectively.
2
COMERICA REPORTS FIRST QUARTER 2009 RESULTS
Net Interest Income and Net Interest Margin
(dollar amounts in millions) |
| 1st Qtr ’09 |
| 4th Qtr ’08 |
| 1st Qtr ’08 |
| |||
Net interest income |
| $ | 384 |
| $ | 431 |
| $ | 476 |
|
|
|
|
|
|
|
|
| |||
Net interest margin |
| 2.53 | % | 2.82 | % | 3.22 | % | |||
|
|
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|
|
|
|
| |||
Selected average balances: |
|
|
|
|
|
|
| |||
Total earning assets |
| $ | 61,752 |
| $ | 61,134 |
| $ | 59,518 |
|
Total investment securities |
| 10,126 |
| 8,734 |
| 7,222 |
| |||
Total loans |
| 49,556 |
| 51,338 |
| 51,852 |
| |||
Total loans, excluding FSD loans (primarily low-rate) |
| 49,344 |
| 51,015 |
| 51,050 |
| |||
|
|
|
|
|
|
|
| |||
Total core deposits*, excluding FSD |
| 31,946 |
| 30,944 |
| 32,620 |
| |||
Total noninterest-bearing deposits |
| 11,364 |
| 10,575 |
| 10,622 |
| |||
Total noninterest-bearing deposits, excluding FSD |
| 10,095 |
| 9,255 |
| 8,728 |
| |||
*Core deposits exclude other time deposits and foreign office time deposits.
· The $47 million decrease in net interest income in the first quarter 2009, when compared to fourth quarter 2008, resulted primarily from a reduction in the net interest margin, a decline in loans and the impact of two less days ($9 million).
· First quarter 2009 average core deposits, excluding the Financial Services Division, increased $1.0 billion compared to fourth quarter 2008, reflecting an $840 million increase in noninterest-bearing deposits. The increase in noninterest-bearing deposits occurred across all business segments from both commercial and consumer customers.
· The net interest margin of 2.53 percent declined 29 basis points, compared to fourth quarter 2008, primarily reflecting the limited opportunity to reduce deposit rates at the same pace as the decline in loan yields and the decreased contribution of noninterest-bearing funds in a significantly lower rate environment, partially offset by increasing loan spreads. Variable rate loan yields generally move with the average target federal funds and one-month LIBOR rates, which declined 82 basis points and 171 basis points, respectively, from the fourth quarter 2008. In addition, the net interest margin was reduced by approximately seven basis points from $1.8 billion of average balances deposited with the Federal Reserve Bank in the first quarter 2009, compared to a reduction of approximately two basis points from $778 million of average balances in the fourth quarter 2008.
· Total average Financial Services Division deposits decreased $268 million from the fourth quarter 2008. This division serves title and escrow companies that facilitate residential mortgage transactions and benefits from customer deposits related to mortgage escrow balances. Deposits continued to decline primarily due to reduced home prices.
Noninterest Income
Noninterest income was $223 million for the first quarter 2009, compared to $174 million for the fourth quarter 2008 and $237 million for the first quarter 2008. Noninterest income in the first quarter 2009, compared to the fourth quarter 2008, included a $24 million pre-tax gain on the termination of certain structured lease transactions (included in “other noninterest income”) and $13 million of net securities gains, which included gains of $8 million from sales of mortgage-backed securities and $5 million from redemptions of auction-rate securities. In addition, deferred compensation asset losses were $5 million in the first quarter 2009, a decrease in losses of $13 million when compared to the fourth quarter 2008 (offset by an increase in deferred compensation plan costs in noninterest expenses). Certain categories of noninterest income are highlighted in the following table.
3
COMERICA REPORTS FIRST QUARTER 2009 RESULTS
(in millions) |
| 1st Qtr ’09 |
| 4th Qtr ’08 |
| 1st Qtr ’08 |
| |||
Net securities gains |
| $ | 13 |
| $ | 4 |
| $ | 22 |
|
Other noninterest income |
|
|
|
|
|
|
| |||
Net income (loss) from principal investing and warrants |
| (2 | ) | (5 | ) | (4 | ) | |||
Deferred compensation asset returns* |
| (5 | ) | (18 | ) | (5 | ) | |||
* Compensation deferred by Comerica officers is invested in stocks and bonds to reflect the investment selections of the officers. Income (loss) earned on these assets is reported in noninterest income and the offsetting increase (decrease) in the liability is reported in salaries expense.
Noninterest Expenses
Noninterest expenses were $397 million for the first quarter 2009, compared to $411 million for the fourth quarter 2008 and $403 million for the first quarter 2008. The $14 million decrease in noninterest expenses in the first quarter 2009, compared to the fourth quarter 2008, reflected a decrease of $16 million in salaries expense and targeted decreases across discretionary categories of noninterest expenses, partially offset by increases of $11 million in pension expense and $8 million in FDIC insurance expense. The decrease in salaries expense was primarily due to decreases of $19 million in severance expense and $6 million in incentives, partially offset by a $13 million increase in deferred compensation plan costs (offset by a decrease in deferred compensation asset losses in noninterest income). Regular salaries expense was also impacted by reductions in full-time equivalent staff of approximately 490 and 160 in the first quarter 2009 and fourth quarter 2008, respectively. Total severance-related expenses were $6 million in the first quarter, down from $29 million in the fourth quarter of 2008. Certain categories of noninterest expenses are highlighted in the table below.
|
| 1st Qtr ’09 |
| 4th Qtr ’08 |
| 1st Qtr ’08 |
| |||
Salaries |
|
|
|
|
|
|
| |||
Regular salaries |
| $ | 147 |
| $ | 152 |
| $ | 151 |
|
Severance |
| 5 |
| 24 |
| 2 |
| |||
Incentives |
| 13 |
| 19 |
| 32 |
| |||
Deferred compensation plan costs |
| (5 | ) | (18 | ) | (5 | ) | |||
Share-based compensation |
| 11 |
| 10 |
| 20 |
| |||
Total salaries |
| 171 |
| 187 |
| 200 |
| |||
Employee benefits |
|
|
|
|
|
|
| |||
Pension expense |
| 16 |
| 5 |
| 5 |
| |||
Other benefits |
| 38 |
| 43 |
| 42 |
| |||
Severance-related benefits |
| 1 |
| 5 |
| — |
| |||
Total employee benefits |
| 55 |
| 53 |
| 47 |
| |||
|
|
|
|
|
|
|
| |||
Customer services |
| — |
| 2 |
| 6 |
| |||
Litigation and operational losses |
| 2 |
| 3 |
| (8 | ) | |||
Provision for credit losses on lending-related commitments |
| (1 | ) | (2 | ) | 4 |
| |||
Other noninterest expenses |
|
|
|
|
|
|
| |||
FDIC insurance |
| 15 |
| 7 |
| 2 |
| |||
Other real estate expense |
| 7 |
| 5 |
| 2 |
| |||
Credit Quality
“We have continued to reserve for loan losses substantially in excess of charge-offs to reflect the continued downturn in the economy,” said Babb. “Our loan loss reserves are established using a thorough methodology, in which the reserve is built credit by credit at the end of each quarter. We continually review the components of the reserve, analyze risk rating migration within industries and geographies, and conduct stress testing. We continue to work hard to stay ahead of the credit issues in this environment.”
4
COMERICA REPORTS FIRST QUARTER 2009 RESULTS
· The allowance to total loans ratio increased to 1.68 percent at March 31, 2009, from 1.52 percent at December 31, 2008 and 1.16 percent at March 31, 2008.
· The provision for loan losses and loan quality reflected challenges in the Midwest, Western and Florida markets and the contracting domestic economy.
· Net credit-related charge-offs in the Commercial Real Estate business line in the first quarter 2009 were $73 million, of which $47 million were from residential real estate developers in the Western market. Comparable numbers for the fourth quarter 2008 were $59 million in total, of which $37 million were from residential real estate developers in the Western market.
· Net loan charge-offs excluding the Commercial Real Estate business line were $84 million in the first quarter 2009, or 76 basis points of average non-Commercial Real Estate loans, compared to $74 million, or 66 basis points, in the fourth quarter 2008.
· Nonperforming assets increased to 2.20 percent of total loans and foreclosed property at March 31, 2009. During the first quarter 2009, $241 million of loan relationships greater than $2 million were transferred to nonaccrual status, a decrease of $17 million from the fourth quarter 2008. Of the transfers of loan relationships greater than $2 million to nonaccrual in the first quarter 2009, $112 million were in the Commercial Real Estate business line and $89 million were in Middle Market, a decrease of $51 million and an increase of $28 million from the fourth quarter 2008, respectively.
(dollar amounts in millions) |
| 1st Qtr ’09 |
| 4th Qtr ’08 |
| 1st Qtr ’08 |
| |||
Net loan charge-offs |
| $ | 157 |
| $ | 133 |
| $ | 110 |
|
Net lending-related commitment charge-offs |
| — |
| — |
| — |
| |||
Total net credit-related charge-offs |
| 157 |
| 133 |
| 110 |
| |||
Net loan charge-offs/Average total loans |
| 1.26 | % | 1.04 | % | 0.85 | % | |||
Net credit-related charge-offs/Average total loans |
| 1.26 |
| 1.04 |
| 0.85 |
| |||
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|
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Provision for loan losses |
| $ | 203 |
| $ | 192 |
| $ | 159 |
|
Provision for credit losses on lending-related commitments |
| (1 | ) | (2 | ) | 4 |
| |||
Total provision for credit losses |
| 202 |
| 190 |
| 163 |
| |||
|
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|
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|
|
| |||
Nonperforming loans |
| 982 |
| 917 |
| 538 |
| |||
Nonperforming assets (NPAs) |
| 1,073 |
| 983 |
| 560 |
| |||
NPAs/Total loans and foreclosed property |
| 2.20 | % | 1.94 | % | 1.07 | % | |||
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| |||
Loans past due 90 days or more and still accruing |
| 207 |
| 125 |
| 80 |
| |||
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|
| |||
Allowance for loan losses |
| $ | 816 |
| $ | 770 |
| $ | 605 |
|
Allowance for credit losses on lending-related commitments* |
| 37 |
| 38 |
| 25 |
| |||
Total allowance for credit losses |
| 853 |
| 808 |
| 630 |
| |||
Allowance for loan losses/Total loans |
| 1.68 | % | 1.52 | % | 1.16 | % | |||
Allowance for loan losses/Nonperforming loans |
| 83 |
| 84 |
| 112 |
| |||
*Included in “Accrued expenses and other liabilities” on the consolidated balance sheets.
5
COMERICA REPORTS FIRST QUARTER 2009 RESULTS
Balance Sheet and Capital Management
Total assets and common shareholders’ equity were $67.4 billion and $5.0 billion, respectively, at March 31, 2009, compared to $67.5 billion and $5.0 billion, respectively, at December 31, 2008. To further preserve and enhance Comerica’s balance sheet strength in the continuing economic downturn, Comerica reduced the quarterly cash dividend rate to $0.05 per common share in the first quarter 2009, from $0.33 per common share in the fourth quarter 2008. This action enables the retention of nearly $170 million per annum in tangible equity. There were approximately 151 million common shares outstanding at March 31, 2009. No shares were repurchased in the open market in the first quarter 2009.
Comerica’s tangible common equity ratio was 7.27 percent at March 31, 2009. The estimated Tier 1 common, Tier 1 and total risk-based capital ratios were 7.33 percent, 11.08 percent and 15.39 percent, respectively.
2009 Outlook
· Management expects to focus on new and expanding existing relationships. Management expects subdued loan demand in light of the rapidly contracting domestic economy.
· Management expects the net interest margin to expand during the remainder of the year with improved loan pricing and the runoff of higher-cost time deposits and debt. The target federal funds and short-term LIBOR rates are expected to remain flat for the remainder of 2009.
· Based on no significant further deterioration of the economic environment, management expects net credit-related charge-offs for full-year 2009 to be $650 million to $700 million. The provision for credit losses is expected to exceed net charge-offs.
· Management expects a mid-single digit decrease in full-year 2009 noninterest expenses, compared to full-year 2008, due to control of discretionary expenses and workforce.
Business Segments
Comerica’s continuing operations are strategically aligned into three major business segments: the Business Bank, the Retail Bank, and Wealth & Institutional Management. The Finance Division also is included as a segment. The financial results below are based on the internal business unit structure of the Corporation and methodologies in effect at March 31, 2009 and are presented on a fully taxable equivalent (FTE) basis. The accompanying narrative addresses first quarter 2009 results compared to fourth quarter 2008.
The following table presents net income (loss) by business segment.
(dollar amounts in millions) |
| 1st Qtr ’09 |
| 4th Qtr ’08 |
| 1st Qtr ’08 |
| |||||||||
Business Bank |
| $ | 56 |
| 91 | % | $ | 53 |
| 165 | % | $ | 62 |
| 51 | % |
Retail Bank |
| (7 | ) | (12 | ) | (34 | ) | (105 | ) | 40 |
| 33 |
| |||
Wealth & Institutional Management |
| 13 |
| 21 |
| 13 |
| 40 |
| 20 |
| 16 |
| |||
|
| 62 |
| 100 | % | 32 |
| 100 | % | 122 |
| 100 | % | |||
Finance |
| (50 | ) |
|
| (37 | ) |
|
| (3 | ) |
|
| |||
Other* |
| (3 | ) |
|
| 25 |
|
|
| (10 | ) |
|
| |||
Total |
| $ | 9 |
|
|
| $ | 20 |
|
|
| $ | 109 |
|
|
|
* Includes discontinued operations and items not directly associated with the three major business segments or the Finance Division.
6
COMERICA REPORTS FIRST QUARTER 2009 RESULTS
Business Bank
(dollar amounts in millions) |
| 1st Qtr ’09 |
| 4th Qtr ’08 |
| 1st Qtr ’08 |
| |||
Net interest income (FTE) |
| $ | 312 |
| $ | 329 |
| $ | 329 |
|
Provision for loan losses |
| 177 |
| 138 |
| 146 |
| |||
Noninterest income |
| 93 |
| 61 |
| 74 |
| |||
Noninterest expenses |
| 157 |
| 172 |
| 177 |
| |||
Net income |
| 56 |
| 53 |
| 62 |
| |||
|
|
|
|
|
|
|
| |||
Net credit-related charge-offs |
| 123 |
| 101 |
| 99 |
| |||
|
|
|
|
|
|
|
| |||
Selected average balances: |
|
|
|
|
|
|
| |||
Assets |
| 39,505 |
| 41,332 |
| 42,129 |
| |||
Loans |
| 38,527 |
| 40,245 |
| 41,219 |
| |||
FSD loans |
| 212 |
| 323 |
| 802 |
| |||
Deposits |
| 14,040 |
| 13,789 |
| 15,877 |
| |||
FSD deposits |
| 1,886 |
| 2,154 |
| 2,988 |
| |||
|
|
|
|
|
|
|
| |||
Net interest margin |
| 3.28 | % | 3.24 | % | 3.21 | % | |||
· Average loans, excluding the Financial Services Division, decreased $1.6 billion, reflecting declines in Middle Market, National Dealer Finance and Global Corporate. Financial Services Division loans decreased $111 million.
· Average deposits, excluding the Financial Services Division, increased $519 million, primarily due to an increase in Global Corporate, partially offset by a decline in Middle Market. Financial Services Division deposits decreased $268 million.
· The net interest margin of 3.28 percent increased four basis points, primarily due to an increase in loan spreads and an increase in noninterest-bearing deposit balances, partially offset by a decrease in deposit spreads.
· The provision for loan losses increased $39 million primarily due to an increase in Middle Market.
· Noninterest income increased $32 million, primarily due to a $24 million pre-tax gain on the termination of certain structured lease transactions and increases in services charges on deposits and commercial lending fees.
· Noninterest expenses decreased $15 million, primarily due to a decline in allocated corporate overhead expenses, partially due to a decrease in severance-related expenses of support units, and a decrease in Financial Services Division-related customer service expense.
Retail Bank
(dollar amounts in millions) |
| 1st Qtr ’09 |
| 4th Qtr ’08 |
| 1st Qtr ’08 |
| |||
Net interest income (FTE) |
| $ | 126 |
| $ | 129 |
| $ | 148 |
|
Provision for loan losses |
| 23 |
| 44 |
| 18 |
| |||
Noninterest income |
| 46 |
| 49 |
| 74 |
| |||
Noninterest expenses |
| 161 |
| 180 |
| 142 |
| |||
Net income |
| (7 | ) | (34 | ) | 40 |
| |||
|
|
|
|
|
|
|
| |||
Net credit-related charge-offs |
| 26 |
| 23 |
| 10 |
| |||
|
|
|
|
|
|
|
| |||
Selected average balances: |
|
|
|
|
|
|
| |||
Assets |
| 6,875 |
| 7,007 |
| 7,144 |
| |||
Loans |
| 6,284 |
| 6,379 |
| 6,276 |
| |||
Deposits |
| 17,391 |
| 17,065 |
| 17,163 |
| |||
|
|
|
|
|
|
|
| |||
Net interest margin |
| 2.93 | % | 3.01 | % | 3.48 | % | |||
7
COMERICA REPORTS FIRST QUARTER 2009 RESULTS
· Average loans decreased $95 million.
· Average deposits increased $326 million, primarily due to an increase in interest-bearing time deposits.
· The net interest margin of 2.93 percent declined eight basis points, primarily due to a decrease in loan spreads, partially offset by an increase in noninterest-bearing deposit balances and deposit spreads.
· The provision for loan losses decreased $21 million, due to both Small Business and Personal Banking.
· Noninterest expenses decreased $19 million, primarily due to decreases in workforce-reduction related salaries and benefits, incentives and allocated corporate overhead, partially due to decreases in severance-related expenses of support units.
Wealth and Institutional Management
(dollar amounts in millions) |
| 1st Qtr ’09 |
| 4th Qtr ’08 |
| 1st Qtr ’08 |
| |||
Net interest income (FTE) |
| $ | 36 |
| $ | 38 |
| $ | 36 |
|
Provision for loan losses |
| 10 |
| 13 |
| — |
| |||
Noninterest income |
| 70 |
| 73 |
| 75 |
| |||
Noninterest expenses |
| 75 |
| 80 |
| 79 |
| |||
Net income |
| 13 |
| 13 |
| 20 |
| |||
|
|
|
|
|
|
|
| |||
Net credit-related charge-offs |
| 8 |
| 9 |
| 1 |
| |||
|
|
|
|
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|
|
| |||
Selected average balances: |
|
|
|
|
|
|
| |||
Assets |
| 4,870 |
| 4,879 |
| 4,468 |
| |||
Loans |
| 4,750 |
| 4,724 |
| 4,315 |
| |||
Deposits |
| 2,429 |
| 2,255 |
| 2,637 |
| |||
|
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|
|
|
|
|
| |||
Net interest margin |
| 3.11 | % | 3.14 | % | 3.34 | % | |||
· Average deposits increased $174 million, primarily due to an increase in noninterest-bearing transaction accounts.
· The net interest margin of 3.11 percent declined three basis points, primarily due to a decline in loan spreads, partially offset by an increase in noninterest-bearing deposit balances.
· The provision for loan losses decreased $3 million.
· Noninterest income decreased $3 million, primarily due to a decline in fiduciary income.
· Noninterest expenses decreased $5 million, primarily due to decreases in workforce-reduction related salaries and benefits, incentives and allocated corporate overhead, in part due to decreases in severance-related expenses of support units, partially offset by the fourth quarter 2008 reversal of $8 million of the auction-rate securities charge taken in the third quarter 2008.
8
COMERICA REPORTS FIRST QUARTER 2009 RESULTS
Geographic Market Segments
Comerica also provides market segment results for four primary geographic markets: Midwest, Western, Texas and Florida. In addition to the four primary geographic markets, Other Markets and International are also reported as market segments. The financial results below are based on methodologies in effect at March 31, 2009 and are presented on a fully taxable equivalent (FTE) basis. The accompanying narrative addresses first quarter 2009 results compared to fourth quarter 2008.
The following table presents net income (loss) by market segment.
(dollar amounts in millions) |
| 1st Qtr ’09 |
| 4th Qtr ’08 |
| 1st Qtr ’08 |
| |||||||||
Midwest |
| $ | 29 |
| 49 | % | $ | 14 |
| 44 | % | $ | 88 |
| 71 | % |
Western |
| (7 | ) | (11 | ) | 2 |
| 7 |
| (10 | ) | (8 | ) | |||
Texas |
| 15 |
| 23 |
| 4 |
| 13 |
| 20 |
| 16 |
| |||
Florida |
| (6 | ) | (10 | ) | (7 | ) | (22 | ) | (4 | ) | (3 | ) | |||
Other Markets |
| 22 |
| 34 |
| 15 |
| 46 |
| 18 |
| 15 |
| |||
International |
| 9 |
| 15 |
| 4 |
| 12 |
| 10 |
| 9 |
| |||
|
| 62 |
| 100 | % | 32 |
| 100 | % | 122 |
| 100 | % | |||
Finance & Other Businesses* |
| (53 | ) |
|
| (12 | ) |
|
| (13 | ) |
|
| |||
Total |
| $ | 9 |
|
|
| $ | 20 |
|
|
| $ | 109 |
|
|
|
* Includes discontinued operations and items not directly associated with the geographic markets.
Midwest
(dollar amounts in millions) |
| 1st Qtr ’09 |
| 4th Qtr ’08 |
| 1st Qtr ’08 |
| |||
Net interest income (FTE) |
| $ | 194 |
| $ | 202 |
| $ | 205 |
|
Provision for loan losses |
| 83 |
| 59 |
| 20 |
| |||
Noninterest income |
| 127 |
| 109 |
| 136 |
| |||
Noninterest expenses |
| 194 |
| 218 |
| 185 |
| |||
Net income |
| 29 |
| 14 |
| 88 |
| |||
|
|
|
|
|
|
|
| |||
Net credit-related charge-offs |
| 54 |
| 38 |
| 28 |
| |||
|
|
|
|
|
|
|
| |||
Selected average balances: |
|
|
|
|
|
|
| |||
Assets |
| 19,139 |
| 19,942 |
| 19,597 |
| |||
Loans |
| 18,267 |
| 18,966 |
| 18,985 |
| |||
Deposits |
| 16,699 |
| 16,204 |
| 16,079 |
| |||
|
|
|
|
|
|
|
| |||
Net interest margin |
| 4.30 | % | 4.21 | % | 4.32 | % | |||
· Average loans decreased $699 million, reflecting declines in Middle Market and Global Corporate.
· Average deposits increased $495 million, due to increases in Global Corporate and Personal Banking deposits.
· The net interest margin of 4.30 percent increased nine basis points, primarily due to an increase in deposit spreads and noninterest-bearing deposit balances.
· The provision for loan losses increased $24 million, primarily due to an increase in Middle Market.
· Noninterest income increased $18 million, primarily due to a $24 million pre-tax gain on the termination of certain structured lease transactions, partially offset by a $3 million decline in fiduciary income.
· Noninterest expenses decreased $24 million, primarily due to decreases in workforce-reduction related salaries and benefits, incentives and allocated corporate overhead, partially due to decreases in severance-related expenses of support units.
9
COMERICA REPORTS FIRST QUARTER 2009 RESULTS
Western Market
(dollar amounts in millions) |
| 1st Qtr ’09 |
| 4th Qtr ’08 |
| 1st Qtr ’08 |
| |||
Net interest income (FTE) |
| $ | 146 |
| $ | 157 |
| $ | 172 |
|
Provision for loan losses |
| 88 |
| 70 |
| 114 |
| |||
Noninterest income |
| 36 |
| 34 |
| 33 |
| |||
Noninterest expenses |
| 104 |
| 114 |
| 108 |
| |||
Net income (loss) |
| (7 | ) | 2 |
| (10 | ) | |||
|
|
|
|
|
|
|
| |||
Net credit-related charge-offs |
| 76 |
| 65 |
| 66 |
| |||
|
|
|
|
|
|
|
| |||
Selected average balances: |
|
|
|
|
|
|
| |||
Assets |
| 15,443 |
| 16,243 |
| 17,287 |
| |||
Loans |
| 15,253 |
| 16,032 |
| 16,906 |
| |||
FSD loans |
| 212 |
| 323 |
| 802 |
| |||
Deposits |
| 10,640 |
| 10,762 |
| 12,849 |
| |||
FSD deposits |
| 1,746 |
| 1,969 |
| 2,802 |
| |||
|
|
|
|
|
|
|
| |||
Net interest margin |
| 3.91 | % | 3.88 | % | 4.08 | % | |||
· Average loans, excluding the Financial Services Division, decreased $668 million due to declines in National Dealer Services, Middle Market and Commercial Real Estate. Financial Services Division loans decreased $111 million.
· Average deposits, excluding the Financial Services Division, increased $101 million, primarily due to an increase in Private Banking, partially offset by a decrease in Technology and Life Sciences. Financial Services Division deposits decreased $223 million.
· The net interest margin of 3.91 percent increased three basis points, partially due to an increase in loan spreads.
· The provision for loan losses increased $18 million, primarily due to an increase in Middle Market.
· Noninterest expenses decreased $10 million, primarily due to decreases in workforce-reduction related salaries and benefits, incentives, Financial Services Division-related customer service expenses and allocated corporate overhead, partially due to severance-related expenses of support units.
Texas Market
(dollar amounts in millions) |
| 1st Qtr ’09 |
| 4th Qtr ’08 |
| 1st Qtr ’08 |
| |||
Net interest income (FTE) |
| $ | 70 |
| $ | 72 |
| $ | 74 |
|
Provision for loan losses |
| 9 |
| 19 |
| 8 |
| |||
Noninterest income |
| 21 |
| 20 |
| 24 |
| |||
Noninterest expenses |
| 58 |
| 63 |
| 58 |
| |||
Net income |
| 15 |
| 4 |
| 20 |
| |||
|
|
|
|
|
|
|
| |||
Total net credit-related charge-offs |
| 8 |
| 8 |
| 5 |
| |||
|
|
|
|
|
|
|
| |||
Selected average balances: |
|
|
|
|
|
|
| |||
Assets |
| 8,069 |
| 8,215 |
| 7,932 |
| |||
Loans |
| 7,847 |
| 7,974 |
| 7,642 |
| |||
Deposits |
| 4,198 |
| 4,070 |
| 4,005 |
| |||
|
|
|
|
|
|
|
| |||
Net interest margin |
| 3.62 | % | 3.57 | % | 3.84 | % | |||
10
COMERICA REPORTS FIRST QUARTER 2009 RESULTS
· Average loans decreased $127 million, primarily due to decreases in Middle Market and National Dealer Services.
· Average deposits increased $128 million, primarily due to increases in Personal Banking and Global Corporate deposits.
· The net interest margin of 3.62 percent increased five basis points, primarily due to an increase in loan spreads and noninterest-bearing deposit balances, partially offset by a decrease in deposit spreads.
· The provision for loan losses decreased $10 million, due to Small Business and Energy lending.
· Noninterest expenses decreased $5 million, primarily due to decreases in workforce-reduction related salaries and benefits, incentives and allocated corporate overhead, partially due to decreases in severance and related expenses of support units.
Florida Market
(dollar amounts in millions) |
| 1st Qtr ’09 |
| 4th Qtr ’08 |
| 1st Qtr ’08 |
| |||
Net interest income (FTE) |
| $ | 11 |
| $ | 11 |
| $ | 11 |
|
Provision for loan losses |
| 15 |
| 14 |
| 12 |
| |||
Noninterest income |
| 3 |
| 4 |
| 5 |
| |||
Noninterest expenses |
| 8 |
| 11 |
| 10 |
| |||
Net income (loss) |
| (6 | ) | (7 | ) | (4 | ) | |||
|
|
|
|
|
|
|
| |||
Net credit-related charge-offs |
| 12 |
| 6 |
| 10 |
| |||
|
|
|
|
|
|
|
| |||
Selected average balances: |
|
|
|
|
|
|
| |||
Assets |
| 1,869 |
| 1,938 |
| 1,891 |
| |||
Loans |
| 1,878 |
| 1,942 |
| 1,877 |
| |||
Deposits |
| 253 |
| 222 |
| 362 |
| |||
|
|
|
|
|
|
|
| |||
Net interest margin |
| 2.31 | % | 2.26 | % | 2.56 | % | |||
· Average loans decreased $64 million, primarily due to declines in Middle Market and National Dealer Services.
· Average deposits increased $31 million, due to increases in Commercial Real Estate and Private Banking.
· The net interest margin of 2.31 percent increased five basis points, primarily due to an increase in deposit spreads, partially offset by a decline in loan spreads.
· Noninterest expenses decreased $3 million, primarily due to decreases in workforce-reduction related salaries and benefits, incentives and allocated corporate overhead, partially due to decreases in severance-related expenses of support units.
Conference Call and Webcast
Comerica will host a conference call to review first quarter 2009 financial results at 7 a.m. CT Tuesday, April 21, 2009. Interested parties may access the conference call by calling (800) 309-2262 or (706) 679-5261 (event ID No. 90513349). The call and supplemental financial information can also be accessed on the Internet at www.comerica.com. A replay will be available approximately two hours following the conference call through April 30, 2009. The conference call replay can be accessed by calling (800) 642-1687 or (706) 645-9291 (event ID No. 90513349). 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 Dallas, Texas, and strategically aligned by three major business segments: the Business Bank, the Retail Bank, and Wealth & Institutional 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, China and Mexico.
11
COMERICA REPORTS FIRST QUARTER 2009 RESULTS
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,” “feels,” “expects,” “estimates,” “seeks,” “strives,” “plans,” “intends,” “outlook,” “forecast,” “position,” “target,” “mission,” “assume,” “achievable,” “potential,” “strategy,” “goal,” “aspiration,” “outcome,” “continue,” “remain,” “maintain,” “trend,” “objective” and variations of such words and similar expressions, or future or conditional verbs such as “will,” “would,” “should,” “could,” “might,” “can,” “may” or similar expressions, as they relate to Comerica or its management, are intended to identify forward-looking statements. These forward-looking statements are predicated on the beliefs and assumptions of Comerica’s management based on information known to Comerica’s management as of the date of this news release and do not purport to speak as of any other date. Forward-looking statements may include descriptions of plans and objectives of Comerica’s management for future or past operations, products or services, and forecasts of Comerica’s revenue, earnings or other measures of economic performance, including statements of profitability, business segments and subsidiaries, estimates of credit trends and global stability. Such statements reflect the view of Comerica’s management as of this date with respect to future events and are subject to risks and uncertainties. Should one or more of these risks materialize or should underlying beliefs or assumptions prove incorrect, Comerica’s actual results could differ materially from those discussed. Factors that could cause or contribute to such differences are further economic downturns, changes in the pace of an economic recovery and related changes in employment levels, changes in real estate values, fuel prices, energy costs or other events that could affect customer income levels or general economic conditions, changes related to the headquarters relocation or to its underlying assumptions, the effects of recently enacted legislation, such as the Emergency Economic Stabilization Act of 2008 and the American Recovery and Reinvestment Act of 2009, and actions taken by the U.S. Department of Treasury, the Board of Governors of the Federal Reserve System, the Texas Department of Banking and the Federal Deposit Insurance Corporation, the effects of war and other armed conflicts or acts of terrorism, the effects of natural disasters including, but not limited to, hurricanes, tornadoes, earthquakes, fires, droughts and floods, the disruption of private or public utilities, the implementation of Comerica’s strategies and business models, management’s ability to maintain and expand customer relationships, changes in customer borrowing, repayment, investment and deposit practices, management’s ability to retain key officers and employees, changes in the accounting treatment of any particular item, the impact of regulatory examinations, declines or other changes in the businesses or industries in which Comerica has a concentration of loans, including, but not limited to, the automotive production industry and the real estate business lines, the anticipated performance of any new banking centers, 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, political or industry conditions and related credit and market conditions, the interdependence of financial service companies and adverse conditions in the stock market. 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. 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 |
|
|
|
|
| Walter Galloway |
|
| (214) 462-6834 |
12
CONSOLIDATED FINANCIAL HIGHLIGHTS
Comerica Incorporated and Subsidiaries
|
| Three Months Ended |
| |||||||
|
| March 31, |
| December 31, |
| March 31, |
| |||
(in millions, except per share data) |
| 2009 |
| 2008 |
| 2008 |
| |||
PER COMMON SHARE AND COMMON STOCK DATA |
|
|
|
|
|
|
| |||
Diluted net income (loss) |
| $ | (0.16 | ) | $ | 0.02 |
| $ | 0.73 |
|
Cash dividends declared |
| 0.05 |
| 0.33 |
| 0.66 |
| |||
Common shareholders’ equity (at period end) |
| 33.32 |
| 33.31 |
| 34.93 |
| |||
|
|
|
|
|
|
|
| |||
Average diluted shares (in thousands) |
| 151,353 |
| 150,834 |
| 150,734 |
| |||
KEY RATIOS |
|
|
|
|
|
|
| |||
Return on average common shareholders’ equity |
| (1.90 | )% | 0.19 | % | 8.42 | % | |||
Return on average assets |
| 0.06 |
| 0.12 |
| 0.68 |
| |||
Tier 1 common capital ratio * |
| 7.33 |
| 7.08 |
| 6.75 |
| |||
Tier 1 risk-based capital ratio * |
| 11.08 |
| 10.66 |
| 7.40 |
| |||
Total risk-based capital ratio * |
| 15.39 |
| 14.72 |
| 11.06 |
| |||
Leverage ratio * |
| 11.65 |
| 11.77 |
| 8.82 |
| |||
Tangible common equity ratio |
| 7.27 |
| 7.21 |
| 7.62 |
| |||
AVERAGE BALANCES |
|
|
|
|
|
|
| |||
Commercial loans |
| $ | 27,180 |
| $ | 28,507 |
| $ | 29,178 |
|
Real estate construction loans |
| 4,510 |
| 4,536 |
| 4,811 |
| |||
Commercial mortgage loans |
| 10,431 |
| 10,613 |
| 10,142 |
| |||
Residential mortgage loans |
| 1,846 |
| 1,851 |
| 1,916 |
| |||
Consumer loans |
| 2,574 |
| 2,639 |
| 2,449 |
| |||
Lease financing |
| 1,300 |
| 1,359 |
| 1,347 |
| |||
International loans |
| 1,715 |
| 1,833 |
| 2,009 |
| |||
Total loans |
| 49,556 |
| 51,338 |
| 51,852 |
| |||
|
|
|
|
|
|
|
| |||
Earning assets |
| 61,752 |
| 61,134 |
| 59,518 |
| |||
Total assets |
| 66,737 |
| 65,981 |
| 63,927 |
| |||
Noninterest-bearing deposits |
| 11,364 |
| 10,575 |
| 10,622 |
| |||
Interest-bearing core deposits |
| 22,468 |
| 22,523 |
| 24,986 |
| |||
Total core deposits |
| 33,832 |
| 33,098 |
| 35,608 |
| |||
Common shareholders’ equity |
| 5,024 |
| 5,206 |
| 5,192 |
| |||
Total shareholders’ equity |
| 7,155 |
| 6,301 |
| 5,192 |
| |||
NET INTEREST INCOME |
|
|
|
|
|
|
| |||
Net interest income (fully taxable equivalent basis) |
| $ | 386 |
| $ | 434 |
| $ | 477 |
|
Fully taxable equivalent adjustment |
| 2 |
| 3 |
| 1 |
| |||
Net interest margin |
| 2.53 | % | 2.82 | % | 3.22 | % | |||
CREDIT QUALITY |
|
|
|
|
|
|
| |||
Nonaccrual loans |
| $ | 982 |
| $ | 917 |
| $ | 538 |
|
Reduced-rate loans |
| — |
| — |
| — |
| |||
Total nonperforming loans |
| 982 |
| 917 |
| 538 |
| |||
Foreclosed property |
| 91 |
| 66 |
| 22 |
| |||
Total nonperforming assets |
| 1,073 |
| 983 |
| 560 |
| |||
|
|
|
|
|
|
|
| |||
Loans past due 90 days or more and still accruing |
| 207 |
| 125 |
| 80 |
| |||
|
|
|
|
|
|
|
| |||
Gross loan charge-offs |
| 161 |
| 144 |
| 116 |
| |||
Loan recoveries |
| 4 |
| 11 |
| 6 |
| |||
Net loan charge-offs |
| 157 |
| 133 |
| 110 |
| |||
Lending-related commitment charge-offs |
| — |
| — |
| — |
| |||
Total net credit-related charge-offs |
| 157 |
| 133 |
| 110 |
| |||
|
|
|
|
|
|
|
| |||
Allowance for loan losses |
| 816 |
| 770 |
| 605 |
| |||
Allowance for credit losses on lending-related commitments |
| 37 |
| 38 |
| 25 |
| |||
Total allowance for credit losses |
| 853 |
| 808 |
| 630 |
| |||
|
|
|
|
|
|
|
| |||
Allowance for loan losses as a percentage of total loans |
| 1.68 | % | 1.52 | % | 1.16 | % | |||
Net loan charge-offs as a percentage of average total loans |
| 1.26 |
| 1.04 |
| 0.85 |
| |||
Net credit-related charge-offs as a percentage of average total loans |
| 1.26 |
| 1.04 |
| 0.85 |
| |||
Nonperforming assets as a percentage of total loans and foreclosed property |
| 2.20 |
| 1.94 |
| 1.07 |
| |||
Allowance for loan losses as a percentage of total nonperforming loans |
| 83 |
| 84 |
| 112 |
| |||
*March 31, 2009 ratios are estimated
13
CONSOLIDATED BALANCE SHEETS
Comerica Incorporated and Subsidiaries
|
| March 31, |
| December 31, |
| March 31, |
| |||
(in millions, except share data) |
| 2009 |
| 2008 |
| 2008 |
| |||
|
|
|
|
|
|
|
| |||
ASSETS |
|
|
|
|
|
|
| |||
Cash and due from banks |
| $ | 952 |
| $ | 913 |
| $ | 1,929 |
|
|
|
|
|
|
|
|
| |||
Federal funds sold and securities purchased under agreements to resell |
| — |
| 202 |
| 45 |
| |||
Interest-bearing deposits with banks |
| 2,558 |
| 2,308 |
| 12 |
| |||
Other short-term investments |
| 248 |
| 158 |
| 344 |
| |||
|
|
|
|
|
|
|
| |||
Investment securities available-for-sale |
| 10,844 |
| 9,201 |
| 8,563 |
| |||
|
|
|
|
|
|
|
| |||
Commercial loans |
| 26,431 |
| 27,999 |
| 29,475 |
| |||
Real estate construction loans |
| 4,379 |
| 4,477 |
| 4,769 |
| |||
Commercial mortgage loans |
| 10,514 |
| 10,489 |
| 10,359 |
| |||
Residential mortgage loans |
| 1,836 |
| 1,852 |
| 1,926 |
| |||
Consumer loans |
| 2,577 |
| 2,592 |
| 2,448 |
| |||
Lease financing |
| 1,232 |
| 1,343 |
| 1,341 |
| |||
International loans |
| 1,655 |
| 1,753 |
| 2,034 |
| |||
Total loans |
| 48,624 |
| 50,505 |
| 52,352 |
| |||
Less allowance for loan losses |
| (816 | ) | (770 | ) | (605 | ) | |||
Net loans |
| 47,808 |
| 49,735 |
| 51,747 |
| |||
|
|
|
|
|
|
|
| |||
Premises and equipment |
| 676 |
| 683 |
| 670 |
| |||
Customers’ liability on acceptances outstanding |
| 10 |
| 14 |
| 28 |
| |||
Accrued income and other assets |
| 4,274 |
| 4,334 |
| 3,679 |
| |||
Total assets |
| $ | 67,370 |
| $ | 67,548 |
| $ | 67,017 |
|
|
|
|
|
|
|
|
| |||
LIABILITIES AND SHAREHOLDERS’ EQUITY |
|
|
|
|
|
|
| |||
Noninterest-bearing deposits |
| $ | 12,645 |
| $ | 11,701 |
| $ | 12,792 |
|
|
|
|
|
|
|
|
|
|
|
|
Money market and NOW deposits |
| 12,240 |
| 12,437 |
| 15,601 |
| |||
Savings deposits |
| 1,328 |
| 1,247 |
| 1,408 |
| |||
Customer certificates of deposit |
| 8,815 |
| 8,807 |
| 8,191 |
| |||
Other time deposits |
| 6,372 |
| 7,293 |
| 7,752 |
| |||
Foreign office time deposits |
| 494 |
| 470 |
| 1,075 |
| |||
Total interest-bearing deposits |
| 29,249 |
| 30,254 |
| 34,027 |
| |||
Total deposits |
| 41,894 |
| 41,955 |
| 46,819 |
| |||
|
|
|
|
|
|
|
| |||
Short-term borrowings |
| 2,207 |
| 1,749 |
| 2,434 |
| |||
Acceptances outstanding |
| 10 |
| 14 |
| 28 |
| |||
Accrued expenses and other liabilities |
| 1,464 |
| 1,625 |
| 1,679 |
| |||
Medium- and long-term debt |
| 14,612 |
| 15,053 |
| 10,800 |
| |||
Total liabilities |
| 60,187 |
| 60,396 |
| 61,760 |
| |||
|
|
|
|
|
|
|
| |||
Fixed rate cumulative perpetual preferred stock, series F, |
|
|
|
|
|
|
| |||
Authorized - 2,250,000 shares |
|
|
|
|
|
|
| |||
Issued - 2,250,000 shares at 3/31/09 and 12/31/08 |
| 2,134 |
| 2,129 |
| — |
| |||
Common stock - $5 par value: |
|
|
|
|
|
|
| |||
Authorized - 325,000,000 shares |
|
|
|
|
|
|
| |||
Issued - 178,735,252 shares at 3/31/09, 12/31/08 and 3/31/08 |
| 894 |
| 894 |
| 894 |
| |||
Capital surplus |
| 727 |
| 722 |
| 565 |
| |||
Accumulated other comprehensive loss |
| (238 | ) | (309 | ) | (67 | ) | |||
Retained earnings |
| 5,252 |
| 5,345 |
| 5,496 |
| |||
Less cost of common stock in treasury - 27,580,899 shares at 3/31/09, 28,244,967 shares at 12/31/08 and 28,233,996 shares at 3/31/08 |
| (1,586 | ) | (1,629 | ) | (1,631 | ) | |||
Total shareholders’ equity |
| 7,183 |
| 7,152 |
| 5,257 |
| |||
Total liabilities and shareholders’ equity |
| $ | 67,370 |
| $ | 67,548 |
| $ | 67,017 |
|
14
CONSOLIDATED STATEMENTS OF INCOME
Comerica Incorporated and Subsidiaries
|
| Three Months Ended |
| ||||
|
| March 31, |
| ||||
(in millions, except per share data) |
| 2009 |
| 2008 |
| ||
|
|
|
|
|
| ||
INTEREST INCOME |
|
|
|
|
| ||
Interest and fees on loans |
| $ | 452 |
| $ | 770 |
|
Interest on investment securities |
| 109 |
| 88 |
| ||
Interest on short-term investments |
| 2 |
| 5 |
| ||
Total interest income |
| 563 |
| 863 |
| ||
|
|
|
|
|
| ||
INTEREST EXPENSE |
|
|
|
|
| ||
Interest on deposits |
| 125 |
| 253 |
| ||
Interest on short-term borrowings |
| 2 |
| 29 |
| ||
Interest on medium- and long-term debt |
| 52 |
| 105 |
| ||
Total interest expense |
| 179 |
| 387 |
| ||
Net interest income |
| 384 |
| 476 |
| ||
Provision for loan losses |
| 203 |
| 159 |
| ||
Net interest income after provision for loan losses |
| 181 |
| 317 |
| ||
|
|
|
|
|
| ||
NONINTEREST INCOME |
|
|
|
|
| ||
Service charges on deposit accounts |
| 58 |
| 58 |
| ||
Fiduciary income |
| 42 |
| 52 |
| ||
Commercial lending fees |
| 18 |
| 16 |
| ||
Letter of credit fees |
| 16 |
| 15 |
| ||
Card fees |
| 12 |
| 14 |
| ||
Brokerage fees |
| 9 |
| 10 |
| ||
Foreign exchange income |
| 9 |
| 10 |
| ||
Bank-owned life insurance |
| 8 |
| 10 |
| ||
Net securities gains |
| 13 |
| 22 |
| ||
Other noninterest income |
| 38 |
| 30 |
| ||
Total noninterest income |
| 223 |
| 237 |
| ||
|
|
|
|
|
| ||
NONINTEREST EXPENSES |
|
|
|
|
| ||
Salaries |
| 171 |
| 200 |
| ||
Employee benefits |
| 55 |
| 47 |
| ||
Total salaries and employee benefits |
| 226 |
| 247 |
| ||
Net occupancy expense |
| 41 |
| 38 |
| ||
Equipment expense |
| 16 |
| 15 |
| ||
Outside processing fee expense |
| 25 |
| 23 |
| ||
Software expense |
| 20 |
| 19 |
| ||
FDIC insurance expense |
| 15 |
| 2 |
| ||
Customer services |
| — |
| 6 |
| ||
Litigation and operational losses (recoveries) |
| 2 |
| (8 | ) | ||
Provision for credit losses on lending-related commitments |
| (1 | ) | 4 |
| ||
Other noninterest expenses |
| 53 |
| 57 |
| ||
Total noninterest expenses |
| 397 |
| 403 |
| ||
Income from continuing operations before income taxes |
| 7 |
| 151 |
| ||
Provision (benefit) for income taxes |
| (1 | ) | 41 |
| ||
Income from continuing operations |
| 8 |
| 110 |
| ||
Income (loss) from discontinued operations, net of tax |
| 1 |
| (1 | ) | ||
NET INCOME |
| 9 |
| 109 |
| ||
Preferred stock dividends |
| 33 |
| — |
| ||
Net income (loss) applicable to common stock |
| $ | (24 | ) | $ | 109 |
|
|
|
|
|
|
| ||
Basic earnings per common share: |
|
|
|
|
| ||
Income (loss) from continuing operations |
| $ | (0.16 | ) | $ | 0.73 |
|
Net income (loss) |
| (0.16 | ) | 0.73 |
| ||
|
|
|
|
|
| ||
Diluted earnings per common share: |
|
|
|
|
| ||
Income (loss) from continuing operations |
| (0.16 | ) | 0.73 |
| ||
Net income (loss) |
| (0.16 | ) | 0.73 |
| ||
|
|
|
|
|
| ||
Cash dividends declared on common stock |
| 7 |
| 99 |
| ||
Cash dividends declared per common share |
| 0.05 |
| 0.66 |
| ||
15
CONSOLIDATED QUARTERLY STATEMENTS OF INCOME
Comerica Incorporated and Subsidiaries
|
| First |
| Fourth |
| Third |
| Second |
| First |
| First Quarter 2009 Compared To: |
| |||||||||||||
|
| Quarter |
| Quarter |
| Quarter |
| Quarter |
| Quarter |
| Fourth Quarter 2008 |
| First Quarter 2008 |
| |||||||||||
(in millions, except per share data) |
| 2009 |
| 2008 |
| 2008 |
| 2008 |
| 2008 |
| Amount |
| Percent |
| Amount |
| Percent |
| |||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
INTEREST INCOME |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
Interest and fees on loans |
| $ | 452 |
| $ | 612 |
| $ | 634 |
| $ | 633 |
| $ | 770 |
| $ | (160 | ) | (26 | )% | $ | (318 | ) | (41 | )% |
Interest on investment securities |
| 109 |
| 101 |
| 99 |
| 101 |
| 88 |
| 8 |
| 8 |
| 21 |
| 24 |
| |||||||
Interest on short-term investments |
| 2 |
| 3 |
| 2 |
| 3 |
| 5 |
| (1 | ) | (32 | ) | (3 | ) | (61 | ) | |||||||
Total interest income |
| 563 |
| 716 |
| 735 |
| 737 |
| 863 |
| (153 | ) | (21 | ) | (300 | ) | (35 | ) | |||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
INTEREST EXPENSE |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
Interest on deposits |
| 125 |
| 158 |
| 141 |
| 182 |
| 253 |
| (33 | ) | (21 | ) | (128 | ) | (51 | ) | |||||||
Interest on short-term borrowings |
| 2 |
| 9 |
| 30 |
| 19 |
| 29 |
| (7 | ) | (81 | ) | (27 | ) | (94 | ) | |||||||
Interest on medium- and long-term debt |
| 52 |
| 118 |
| 98 |
| 94 |
| 105 |
| (66 | ) | (56 | ) | (53 | ) | (51 | ) | |||||||
Total interest expense |
| 179 |
| 285 |
| 269 |
| 295 |
| 387 |
| (106 | ) | (37 | ) | (208 | ) | (54 | ) | |||||||
Net interest income |
| 384 |
| 431 |
| 466 |
| 442 |
| 476 |
| (47 | ) | (11 | ) | (92 | ) | (19 | ) | |||||||
Provision for loan losses |
| 203 |
| 192 |
| 165 |
| 170 |
| 159 |
| 11 |
| 6 |
| 44 |
| 28 |
| |||||||
Net interest income after provision for loan losses |
| 181 |
| 239 |
| 301 |
| 272 |
| 317 |
| (58 | ) | (24 | ) | (136 | ) | (43 | ) | |||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
NONINTEREST INCOME |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
Service charges on deposit accounts |
| 58 |
| 55 |
| 57 |
| 59 |
| 58 |
| 3 |
| 4 |
| — |
| — |
| |||||||
Fiduciary income |
| 42 |
| 47 |
| 49 |
| 51 |
| 52 |
| (5 | ) | (10 | ) | (10 | ) | (19 | ) | |||||||
Commercial lending fees |
| 18 |
| 16 |
| 17 |
| 20 |
| 16 |
| 2 |
| 12 |
| 2 |
| 14 |
| |||||||
Letter of credit fees |
| 16 |
| 17 |
| 19 |
| 18 |
| 15 |
| (1 | ) | (11 | ) | 1 |
| 3 |
| |||||||
Card fees |
| 12 |
| 13 |
| 15 |
| 16 |
| 14 |
| (1 | ) | (12 | ) | (2 | ) | (18 | ) | |||||||
Brokerage fees |
| 9 |
| 12 |
| 10 |
| 10 |
| 10 |
| (3 | ) | (21 | ) | (1 | ) | (14 | ) | |||||||
Foreign exchange income |
| 9 |
| 7 |
| 11 |
| 12 |
| 10 |
| 2 |
| 24 |
| (1 | ) | (7 | ) | |||||||
Bank-owned life insurance |
| 8 |
| 9 |
| 11 |
| 8 |
| 10 |
| (1 | ) | (6 | ) | (2 | ) | (13 | ) | |||||||
Net securities gains |
| 13 |
| 4 |
| 27 |
| 14 |
| 22 |
| 9 |
| N/M |
| (9 | ) | (40 | ) | |||||||
Other noninterest income |
| 38 |
| (6 | ) | 24 |
| 34 |
| 30 |
| 44 |
| N/M |
| 8 |
| 25 |
| |||||||
Total noninterest income |
| 223 |
| 174 |
| 240 |
| 242 |
| 237 |
| 49 |
| 28 |
| (14 | ) | (6 | ) | |||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
NONINTEREST EXPENSES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
Salaries |
| 171 |
| 187 |
| 192 |
| 202 |
| 200 |
| (16 | ) | (9 | ) | (29 | ) | (14 | ) | |||||||
Employee benefits |
| 55 |
| 53 |
| 46 |
| 48 |
| 47 |
| 2 |
| 4 |
| 8 |
| 16 |
| |||||||
Total salaries and employee benefits |
| 226 |
| 240 |
| 238 |
| 250 |
| 247 |
| (14 | ) | (6 | ) | (21 | ) | (9 | ) | |||||||
Net occupancy expense |
| 41 |
| 42 |
| 40 |
| 36 |
| 38 |
| (1 | ) | (1 | ) | 3 |
| 8 |
| |||||||
Equipment expense |
| 16 |
| 16 |
| 15 |
| 16 |
| 15 |
| — |
| (4 | ) | 1 |
| 3 |
| |||||||
Outside processing fee expense |
| 25 |
| 27 |
| 26 |
| 28 |
| 23 |
| (2 | ) | (10 | ) | 2 |
| 8 |
| |||||||
Software expense |
| 20 |
| 19 |
| 18 |
| 20 |
| 19 |
| 1 |
| 4 |
| 1 |
| 5 |
| |||||||
FDIC insurance expense |
| 15 |
| 7 |
| 6 |
| 2 |
| 2 |
| 8 |
| N/M |
| 13 |
| N/M |
| |||||||
Customer services |
| — |
| 2 |
| 2 |
| 3 |
| 6 |
| (2 | ) | N/M |
| (6 | ) | N/M |
| |||||||
Litigation and operational losses (recoveries) |
| 2 |
| 3 |
| 105 |
| 3 |
| (8 | ) | (1 | ) | (12 | ) | 10 |
| N/M |
| |||||||
Provision for credit losses on lending-related commitments |
| (1 | ) | (2 | ) | 9 |
| 7 |
| 4 |
| 1 |
| 55 |
| (5 | ) | N/M |
| |||||||
Other noninterest expenses |
| 53 |
| 57 |
| 55 |
| 58 |
| 57 |
| (4 | ) | (7 | ) | (4 | ) | (6 | ) | |||||||
Total noninterest expenses |
| 397 |
| 411 |
| 514 |
| 423 |
| 403 |
| (14 | ) | (3 | ) | (6 | ) | (2 | ) | |||||||
Income from continuing operations before income taxes |
| 7 |
| 2 |
| 27 |
| 91 |
| 151 |
| 5 |
| N/M |
| (144 | ) | (95 | ) | |||||||
Provision (benefit) for income taxes |
| (1 | ) | (17 | ) | — |
| 35 |
| 41 |
| 16 |
| 92 |
| (42 | ) | N/M |
| |||||||
Income from continuing operations |
| 8 |
| 19 |
| 27 |
| 56 |
| 110 |
| (11 | ) | (56 | ) | (102 | ) | (92 | ) | |||||||
Income (loss) from discontinued operations, net of tax |
| 1 |
| 1 |
| 1 |
| — |
| (1 | ) | — |
| 69 |
| 2 |
| N/M |
| |||||||
NET INCOME |
| 9 |
| 20 |
| 28 |
| 56 |
| 109 |
| (11 | ) | (52 | ) | (100 | ) | (91 | ) | |||||||
Preferred stock dividends |
| 33 |
| 17 |
| — |
| — |
| — |
| 16 |
| 93 |
| 33 |
| N/M |
| |||||||
Net income (loss) applicable to common stock |
| $ | (24 | ) | $ | 3 |
| $ | 28 |
| $ | 56 |
| $ | 109 |
| $ | (27 | ) | N/M | % | $ | (133 | ) | N/M | % |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
Basic earnings per common share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
Income (loss) from continuing operations |
| $ | (0.16 | ) | $ | 0.01 |
| $ | 0.18 |
| $ | 0.37 |
| $ | 0.73 |
| $ | (0.17 | ) | N/M | % | $ | (0.89 | ) | N/M | % |
Net income (loss) |
| (0.16 | ) | 0.02 |
| 0.19 |
| 0.37 |
| 0.73 |
| (0.18 | ) | N/M |
| (0.89 | ) | N/M |
| |||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
Diluted earnings per common share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
Income (loss) from continuing operations |
| (0.16 | ) | 0.01 |
| 0.18 |
| 0.37 |
| 0.73 |
| (0.17 | ) | N/M |
| (0.89 | ) | N/M |
| |||||||
Net income (loss) |
| (0.16 | ) | 0.02 |
| 0.19 |
| 0.37 |
| 0.73 |
| (0.18 | ) | N/M |
| (0.89 | ) | N/M |
| |||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
Cash dividends declared on common stock |
| 7 |
| 50 |
| 99 |
| 100 |
| 99 |
| (43 | ) | (85 | ) | (92 | ) | (92 | ) | |||||||
Cash dividends declared per common share |
| 0.05 |
| 0.33 |
| 0.66 |
| 0.66 |
| 0.66 |
| (0.28 | ) | (85 | ) | (0.61 | ) | (92 | ) | |||||||
N/M - Not meaningful
16
ANALYSIS OF THE ALLOWANCE FOR LOAN LOSSES
Comerica Incorporated and Subsidiaries
|
| 2009 |
| 2008 |
| |||||||||||
(in millions) |
| 1st Qtr |
| 4th Qtr |
| 3rd Qtr |
| 2nd Qtr |
| 1st Qtr |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Balance at beginning of period |
| $ | 770 |
| $ | 712 |
| $ | 663 |
| $ | 605 |
| $ | 557 |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
Loan charge-offs: |
|
|
|
|
|
|
|
|
|
|
| |||||
Commercial |
| 61 |
| 66 |
| 48 |
| 36 |
| 33 |
| |||||
Real estate construction: |
|
|
|
|
|
|
|
|
|
|
| |||||
Commercial Real Estate business line |
| 57 |
| 35 |
| 40 |
| 57 |
| 52 |
| |||||
Other business lines |
| — |
| — |
| — |
| — |
| 1 |
| |||||
Total real estate construction |
| 57 |
| 35 |
| 40 |
| 57 |
| 53 |
| |||||
Commercial mortgage: |
|
|
|
|
|
|
|
|
|
|
| |||||
Commercial Real Estate business line |
| 16 |
| 21 |
| 17 |
| 14 |
| 20 |
| |||||
Other business lines |
| 18 |
| 8 |
| 11 |
| 7 |
| 2 |
| |||||
Total commercial mortgage |
| 34 |
| 29 |
| 28 |
| 21 |
| 22 |
| |||||
Residential mortgage |
| 2 |
| 5 |
| 1 |
| 1 |
| — |
| |||||
Consumer |
| 6 |
| 7 |
| 5 |
| 3 |
| 7 |
| |||||
Lease financing |
| — |
| 1 |
| — |
| — |
| — |
| |||||
International |
| 1 |
| 1 |
| — |
| — |
| 1 |
| |||||
Total loan charge-offs |
| 161 |
| 144 |
| 122 |
| 118 |
| 116 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Recoveries on loans previously charged-off: |
|
|
|
|
|
|
|
|
|
|
| |||||
Commercial |
| 3 |
| 6 |
| 3 |
| 5 |
| 3 |
| |||||
Real estate construction |
| — |
| 1 |
| 1 |
| — |
| 1 |
| |||||
Commercial mortgage |
| — |
| 2 |
| — |
| 1 |
| 1 |
| |||||
Residential mortgage |
| — |
| — |
| — |
| — |
| — |
| |||||
Consumer |
| 1 |
| 1 |
| 1 |
| — |
| 1 |
| |||||
Lease financing |
| — |
| — |
| 1 |
| — |
| — |
| |||||
International |
| — |
| 1 |
| — |
| — |
| — |
| |||||
Total recoveries |
| 4 |
| 11 |
| 6 |
| 6 |
| 6 |
| |||||
Net loan charge-offs |
| 157 |
| 133 |
| 116 |
| 112 |
| 110 |
| |||||
Provision for loan losses |
| 203 |
| 192 |
| 165 |
| 170 |
| 159 |
| |||||
Foreign currency translation adjustment |
| — |
| (1 | ) | — |
| — |
| (1 | ) | |||||
Balance at end of period |
| $ | 816 |
| $ | 770 |
| $ | 712 |
| $ | 663 |
| $ | 605 |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
Allowance for loan losses as a percentage of total loans |
| 1.68 | % | 1.52 | % | 1.38 | % | 1.28 | % | 1.16 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Net loan charge-offs as a percentage of average total loans |
| 1.26 |
| 1.04 |
| 0.90 |
| 0.86 |
| 0.85 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Net credit-related charge-offs as a percentage of average total loans |
| 1.26 |
| 1.04 |
| 0.90 |
| 0.86 |
| 0.85 |
| |||||
ANALYSIS OF THE ALLOWANCE FOR CREDIT LOSSES ON LENDING-RELATED COMMITMENTS
Comerica Incorporated and Subsidiaries
|
| 2009 |
| 2008 |
| |||||||||||
(in millions) |
| 1st Qtr |
| 4th Qtr |
| 3rd Qtr |
| 2nd Qtr |
| 1st Qtr |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Balance at beginning of period |
| $ | 38 |
| $ | 40 |
| $ | 31 |
| $ | 25 |
| $ | 21 |
|
Less: Charge-offs on lending-related commitments (1) |
| — |
| — |
| — |
| 1 |
| — |
| |||||
Add: Provision for credit losses on lending-related commitments |
| (1 | ) | (2 | ) | 9 |
| 7 |
| 4 |
| |||||
Balance at end of period |
| $ | 37 |
| $ | 38 |
| $ | 40 |
| $ | 31 |
| $ | 25 |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
Unfunded lending-related commitments sold |
| $ | — |
| $ | — |
| $ | — |
| $ | 2 |
| $ | 3 |
|
(1) Charge-offs result from the sale of unfunded lending-related commitments.
17
NONPERFORMING ASSETS
Comerica Incorporated and Subsidiaries
|
| 2009 |
| 2008 |
| |||||||||||
(in millions) |
| 1st Qtr |
| 4th Qtr |
| 3rd Qtr |
| 2nd Qtr |
| 1st Qtr |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
SUMMARY OF NONPERFORMING ASSETS AND PAST DUE LOANS |
|
|
|
|
|
|
|
|
|
|
| |||||
Nonaccrual loans: |
|
|
|
|
|
|
|
|
|
|
| |||||
Commercial |
| $ | 258 |
| $ | 205 |
| $ | 206 |
| $ | 155 |
| $ | 87 |
|
Real estate construction: |
|
|
|
|
|
|
|
|
|
|
| |||||
Commercial Real Estate business line |
| 426 |
| 429 |
| 386 |
| 322 |
| 271 |
| |||||
Other business lines |
| 5 |
| 5 |
| 5 |
| 4 |
| 4 |
| |||||
Total real estate construction |
| 431 |
| 434 |
| 391 |
| 326 |
| 275 |
| |||||
Commercial mortgage: |
|
|
|
|
|
|
|
|
|
|
| |||||
Commercial Real Estate business line |
| 131 |
| 132 |
| 137 |
| 143 |
| 105 |
| |||||
Other business lines |
| 138 |
| 130 |
| 114 |
| 95 |
| 64 |
| |||||
Total commercial mortgage |
| 269 |
| 262 |
| 251 |
| 238 |
| 169 |
| |||||
Residential mortgage |
| 8 |
| 7 |
| 8 |
| 4 |
| 1 |
| |||||
Consumer |
| 8 |
| 6 |
| 4 |
| 5 |
| 3 |
| |||||
Lease financing |
| 2 |
| 1 |
| — |
| — |
| — |
| |||||
International |
| 6 |
| 2 |
| 3 |
| 3 |
| 3 |
| |||||
Total nonaccrual loans |
| 982 |
| 917 |
| 863 |
| 731 |
| 538 |
| |||||
Reduced-rate loans |
| — |
| — |
| — |
| — |
| — |
| |||||
Total nonperforming loans |
| 982 |
| 917 |
| 863 |
| 731 |
| 538 |
| |||||
Foreclosed property |
| 91 |
| 66 |
| 18 |
| 17 |
| 22 |
| |||||
Total nonperforming assets |
| $ | 1,073 |
| $ | 983 |
| $ | 881 |
| $ | 748 |
| $ | 560 |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
Nonperforming loans as a percentage of total loans |
| 2.02 | % | 1.82 | % | 1.67 | % | 1.41 | % | 1.03 | % | |||||
Nonperforming assets as a percentage of total loans and foreclosed property |
| 2.20 |
| 1.94 |
| 1.71 |
| 1.44 |
| 1.07 |
| |||||
Allowance for loan losses as a percentage of total nonperforming loans |
| 83 |
| 84 |
| 82 |
| 91 |
| 112 |
| |||||
Loans past due 90 days or more and still accruing |
| $ | 207 |
| $ | 125 |
| $ | 97 |
| $ | 112 |
| $ | 80 |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
ANALYSIS OF NONACCRUAL LOANS |
|
|
|
|
|
|
|
|
|
|
| |||||
Nonaccrual loans at beginning of period |
| $ | 917 |
| $ | 863 |
| $ | 731 |
| $ | 538 |
| $ | 391 |
|
Loans transferred to nonaccrual (1) |
| 241 |
| 258 |
| 280 |
| 304 |
| 281 |
| |||||
Nonaccrual business loan gross charge-offs (2) |
| (153 | ) | (132 | ) | (116 | ) | (113 | ) | (108 | ) | |||||
Loans transferred to accrual status (1) |
| (4 | ) | (11 | ) | — |
| — |
| — |
| |||||
Nonaccrual business loans sold (3) |
| (3 | ) | (14 | ) | (18 | ) | — |
| (15 | ) | |||||
Payments/Other (4) |
| (16 | ) | (47 | ) | (14 | ) | 2 |
| (11 | ) | |||||
Nonaccrual loans at end of period |
| $ | 982 |
| $ | 917 |
| $ | 863 |
| $ | 731 |
| $ | 538 |
|
(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 |
| $ | 153 |
| $ | 132 |
| $ | 116 |
| $ | 113 |
| $ | 108 |
|
| Performing watch list loans |
| — |
| — |
| — |
| 1 |
| 1 |
| |||||
| Consumer and residential mortgage loans |
| 8 |
| 12 |
| 6 |
| 4 |
| 7 |
| |||||
| Total gross loan charge-offs |
| $ | 161 |
| $ | 144 |
| $ | 122 |
| $ | 118 |
| $ | 116 |
|
(3) | Analysis of loans sold: |
|
|
|
|
|
|
|
|
|
|
| |||||
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
| Nonaccrual business loans |
| $ | 3 |
| $ | 14 |
| $ | 18 |
| $ | — |
| $ | 15 |
|
| Performing watch list loans |
| — |
| — |
| 3 |
| 7 |
| 6 |
| |||||
| Total loans sold |
| $ | 3 |
| $ | 14 |
| $ | 21 |
| $ | 7 |
| $ | 21 |
|
(4) | Includes net changes related to nonaccrual loans with balances less than $2 million, payments on non-accrual 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 (FTE)
Comerica Incorporated and Subsidiaries
|
| Three Months Ended |
| ||||||||||||||||||||||
|
| March 31, 2009 |
| December 31, 2008 |
| March 31, 2008 |
| ||||||||||||||||||
|
| Average |
|
|
| Average |
| Average |
|
|
| Average |
| Average |
|
|
| Average |
| ||||||
(dollar amounts in millions) |
| Balance |
| Interest |
| Rate |
| Balance |
| Interest |
| Rate |
| Balance |
| Interest |
| Rate |
| ||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Commercial loans (1) (2) |
| $ | 27,180 |
| $ | 228 |
| 3.39 | % | $ | 28,507 |
| $ | 334 |
| 4.65 | % | $ | 29,178 |
| $ | 429 |
| 5.93 | % |
Real estate construction loans |
| 4,510 |
| 33 |
| 2.99 |
| 4,536 |
| 46 |
| 4.08 |
| 4,811 |
| 71 |
| 5.92 |
| ||||||
Commercial mortgage loans |
| 10,431 |
| 109 |
| 4.22 |
| 10,613 |
| 138 |
| 5.17 |
| 10,142 |
| 159 |
| 6.29 |
| ||||||
Residential mortgage loans |
| 1,846 |
| 26 |
| 5.66 |
| 1,851 |
| 27 |
| 5.80 |
| 1,916 |
| 29 |
| 6.01 |
| ||||||
Consumer loans |
| 2,574 |
| 24 |
| 3.79 |
| 2,639 |
| 30 |
| 4.49 |
| 2,449 |
| 37 |
| 6.02 |
| ||||||
Lease financing |
| 1,300 |
| 9 |
| 2.82 |
| 1,359 |
| 12 |
| 3.63 |
| 1,347 |
| 11 |
| 3.22 |
| ||||||
International loans |
| 1,715 |
| 16 |
| 3.85 |
| 1,833 |
| 22 |
| 4.78 |
| 2,009 |
| 30 |
| 6.01 |
| ||||||
Business loan swap income |
| — |
| 8 |
| — |
| — |
| 5 |
| — |
| — |
| 5 |
| — |
| ||||||
Total loans (2) |
| 49,556 |
| 453 |
| 3.70 |
| 51,338 |
| 614 |
| 4.76 |
| 51,852 |
| 771 |
| 5.98 |
| ||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Auction-rate securities available-for-sale |
| 1,108 |
| 5 |
| 1.71 |
| 769 |
| 6 |
| 2.95 |
| — |
| — |
| — |
| ||||||
Other investment securities available-for-sale |
| 9,018 |
| 105 |
| 4.82 |
| 7,965 |
| 96 |
| 4.86 |
| 7,222 |
| 88 |
| 4.93 |
| ||||||
Total investment securities available-for-sale |
| 10,126 |
| 110 |
| 4.46 |
| 8,734 |
| 102 |
| 4.69 |
| 7,222 |
| 88 |
| 4.93 |
| ||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Federal funds sold and securities purchased under agreements to resell |
| 57 |
| — |
| 0.32 |
| 75 |
| — |
| 0.83 |
| 80 |
| 1 |
| 3.28 |
| ||||||
Interest-bearing deposits with banks |
| 1,848 |
| 1 |
| 0.23 |
| 811 |
| 1 |
| 0.50 |
| 19 |
| — |
| 2.79 |
| ||||||
Other short-term investments |
| 165 |
| 1 |
| 1.67 |
| 176 |
| 2 |
| 3.59 |
| 345 |
| 4 |
| 4.43 |
| ||||||
Total earning assets |
| 61,752 |
| 565 |
| 3.71 |
| 61,134 |
| 719 |
| 4.68 |
| 59,518 |
| 864 |
| 5.84 |
| ||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Cash and due from banks |
| 950 |
|
|
|
|
| 1,056 |
|
|
|
|
| 1,240 |
|
|
|
|
| ||||||
Allowance for loan losses |
| (832 | ) |
|
|
|
| (780 | ) |
|
|
|
| (596 | ) |
|
|
|
| ||||||
Accrued income and other assets |
| 4,867 |
|
|
|
|
| 4,571 |
|
|
|
|
| 3,765 |
|
|
|
|
| ||||||
Total assets |
| $ | 66,737 |
|
|
|
|
| $ | 65,981 |
|
|
|
|
| $ | 63,927 |
|
|
|
|
| |||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Money market and NOW deposits (1) |
| $ | 12,334 |
| 19 |
| 0.63 |
| $ | 12,670 |
| 37 |
| 1.16 |
| $ | 15,341 |
| 79 |
| 2.06 |
| |||
Savings deposits |
| 1,278 |
| 1 |
| 0.18 |
| 1,264 |
| 1 |
| 0.29 |
| 1,359 |
| 2 |
| 0.64 |
| ||||||
Customer certificates of deposit |
| 8,856 |
| 58 |
| 2.67 |
| 8,589 |
| 63 |
| 2.91 |
| 8,286 |
| 84 |
| 4.07 |
| ||||||
Total interest-bearing core deposits |
| 22,468 |
| 78 |
| 1.41 |
| 22,523 |
| 101 |
| 1.78 |
| 24,986 |
| 165 |
| 2.65 |
| ||||||
Other time deposits |
| 6,280 |
| 46 |
| 3.01 |
| 6,702 |
| 56 |
| 3.35 |
| 7,257 |
| 77 |
| 4.28 |
| ||||||
Foreign office time deposits |
| 670 |
| 1 |
| 0.42 |
| 516 |
| 1 |
| 0.81 |
| 1,197 |
| 11 |
| 3.81 |
| ||||||
Total interest-bearing deposits |
| 29,418 |
| 125 |
| 1.73 |
| 29,741 |
| 158 |
| 2.12 |
| 33,440 |
| 253 |
| 3.05 |
| ||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Short-term borrowings |
| 2,362 |
| 2 |
| 0.29 |
| 2,808 |
| 9 |
| 1.27 |
| 3,497 |
| 29 |
| 3.28 |
| ||||||
Medium- and long-term debt |
| 14,924 |
| 52 |
| 1.40 |
| 15,016 |
| 118 |
| 3.14 |
| 9,856 |
| 105 |
| 4.27 |
| ||||||
Total interest-bearing sources |
| 46,704 |
| 179 |
| 1.55 |
| 47,565 |
| 285 |
| 2.39 |
| 46,793 |
| 387 |
| 3.32 |
| ||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Noninterest-bearing deposits (1) |
| 11,364 |
|
|
|
|
| 10,575 |
|
|
|
|
| 10,622 |
|
|
|
|
| ||||||
Accrued expenses and other liabilities |
| 1,514 |
|
|
|
|
| 1,540 |
|
|
|
|
| 1,320 |
|
|
|
|
| ||||||
Total shareholders’ equity |
| 7,155 |
|
|
|
|
| 6,301 |
|
|
|
|
| 5,192 |
|
|
|
|
| ||||||
Total liabilities and shareholders’ equity |
| $ | 66,737 |
|
|
|
|
| $ | 65,981 |
|
|
|
|
| $ | 63,927 |
|
|
|
|
| |||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Net interest income/rate spread (FTE) |
|
|
| $ | 386 |
| 2.16 |
|
|
| $ | 434 |
| 2.29 |
|
|
| $ | 477 |
| 2.52 |
| |||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
FTE adjustment |
|
|
| $ | 2 |
|
|
|
|
| $ | 3 |
|
|
|
|
| $ | 1 |
|
|
| |||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Impact of net noninterest-bearing sources of funds |
|
|
|
|
| 0.37 |
|
|
|
|
| 0.53 |
|
|
|
|
| 0.70 |
| ||||||
Net interest margin (as a percentage of average earning assets) (FTE) (2) |
|
|
|
|
| 2.53 | % |
|
|
|
| 2.82 | % |
|
|
|
| 3.22 | % | ||||||
(1) | FSD balances included above: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
| Loans (primarily low-rate) |
| $ | 212 |
| $ | 1 |
| 1.97 | % | $ | 323 |
| $ | 1 |
| 1.60 | % | $ | 802 |
| $ | 2 |
| 1.12 | % |
| Interest-bearing deposits |
| 617 |
| 1 |
| 0.61 |
| 834 |
| 3 |
| 1.55 |
| 1,094 |
| 8 |
| 2.77 |
| ||||||
| Noninterest-bearing deposits |
| 1,269 |
|
|
|
|
| 1,320 |
|
|
|
|
| 1,894 |
|
|
|
|
| ||||||
(2) | Impact of FSD loans (primarily low-rate) on the following: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
| Commercial loans |
|
|
|
|
| (0.01 | )% |
|
|
|
| (0.03 | )% |
|
|
|
| (0.13 | )% | ||||||
| Total loans |
|
|
|
|
| (0.01 | ) |
|
|
|
| (0.02 | ) |
|
|
|
| (0.08 | ) | ||||||
| Net interest margin (FTE) (assuming loans were funded by noninterest-bearing deposits) |
|
|
|
|
| (0.01 | ) |
|
|
|
| — |
|
|
|
|
| (0.03 | ) | ||||||
19
CONSOLIDATED STATISTICAL DATA
Comerica Incorporated and Subsidiaries
|
| March 31, |
| December 31, |
| September 30, |
| June 30, |
| March 31, |
| |||||
(in millions, except per share data) |
| 2009 |
| 2008 |
| 2008 |
| 2008 |
| 2008 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Commercial loans: |
|
|
|
|
|
|
|
|
|
|
| |||||
Floor plan |
| $ | 1,763 |
| $ | 2,341 |
| $ | 2,151 |
| $ | 2,645 |
| $ | 2,913 |
|
Other |
| 24,668 |
| 25,658 |
| 26,453 |
| 26,118 |
| 26,562 |
| |||||
Total commercial loans |
| 26,431 |
| 27,999 |
| 28,604 |
| 28,763 |
| 29,475 |
| |||||
Real estate construction loans: |
|
|
|
|
|
|
|
|
|
|
| |||||
Commercial Real Estate business line |
| 3,711 |
| 3,831 |
| 3,937 |
| 4,013 |
| 3,990 |
| |||||
Other business lines |
| 668 |
| 646 |
| 628 |
| 671 |
| 656 |
| |||||
Total real estate construction loans |
| 4,379 |
| 4,477 |
| 4,565 |
| 4,684 |
| 4,646 |
| |||||
Commercial mortgage loans: |
|
|
|
|
|
|
|
|
|
|
| |||||
Commercial Real Estate business line |
| 1,659 |
| 1,619 |
| 1,668 |
| 1,620 |
| 1,541 |
| |||||
Other business lines |
| 8,855 |
| 8,870 |
| 8,920 |
| 8,884 |
| 8,941 |
| |||||
Total commercial mortgage loans |
| 10,514 |
| 10,489 |
| 10,588 |
| 10,504 |
| 10,482 |
| |||||
Residential mortgage loans |
| 1,836 |
| 1,852 |
| 1,863 |
| 1,879 |
| 1,926 |
| |||||
Consumer loans: |
|
|
|
|
|
|
|
|
|
|
| |||||
Home equity |
| 1,791 |
| 1,781 |
| 1,693 |
| 1,649 |
| 1,619 |
| |||||
Other consumer |
| 786 |
| 811 |
| 951 |
| 945 |
| 829 |
| |||||
Total consumer loans |
| 2,577 |
| 2,592 |
| 2,644 |
| 2,594 |
| 2,448 |
| |||||
Lease financing |
| 1,232 |
| 1,343 |
| 1,360 |
| 1,351 |
| 1,341 |
| |||||
International loans |
| 1,655 |
| 1,753 |
| 1,931 |
| 1,976 |
| 2,034 |
| |||||
Total loans |
| $ | 48,624 |
| $ | 50,505 |
| $ | 51,555 |
| $ | 51,751 |
| $ | 52,352 |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
Goodwill |
| $ | 150 |
| $ | 150 |
| $ | 150 |
| $ | 150 |
| $ | 150 |
|
Loan servicing rights |
| 10 |
| 11 |
| 12 |
| 12 |
| 12 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Tier 1 common capital ratio* |
| 7.33 | % | 7.08 | % | 6.67 | % | 6.79 | % | 6.75 | % | |||||
Tier 1 risk-based capital ratio* |
| 11.08 |
| 10.66 |
| 7.32 |
| 7.45 |
| 7.40 |
| |||||
Total risk-based capital ratio * |
| 15.39 |
| 14.72 |
| 11.19 |
| 11.21 |
| 11.06 |
| |||||
Leverage ratio* |
| 11.65 |
| 11.77 |
| 8.57 |
| 8.53 |
| 8.82 |
| |||||
Tangible common equity ratio |
| 7.27 |
| 7.21 |
| 7.60 |
| 7.47 |
| 7.62 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Book value per common share |
| $ | 33.32 |
| $ | 33.31 |
| $ | 33.89 |
| $ | 33.78 |
| $ | 34.93 |
|
Market value per share for the quarter: |
|
|
|
|
|
|
|
|
|
|
| |||||
High |
| $ | 21.20 |
| $ | 37.01 |
| $ | 43.99 |
| $ | 40.62 |
| $ | 45.19 |
|
Low |
| 11.72 |
| 15.05 |
| 19.31 |
| 25.61 |
| 34.51 |
| |||||
Close |
| 18.31 |
| 19.85 |
| 32.79 |
| 25.63 |
| 35.08 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Quarterly ratios: |
|
|
|
|
|
|
|
|
|
|
| |||||
Return on average common shareholders’ equity |
| (1.90 | )% | 0.19 | % | 2.25 | % | 4.25 | % | 8.42 | % | |||||
Return on average assets |
| 0.06 |
| 0.12 |
| 0.18 |
| 0.33 |
| 0.68 |
| |||||
Efficiency ratio |
| 66.61 |
| 68.19 |
| 75.53 |
| 63.02 |
| 58.25 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Number of banking centers |
| 440 |
| 439 |
| 424 |
| 416 |
| 420 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Number of employees - full time equivalent |
| 9,696 |
| 10,186 |
| 10,347 |
| 10,530 |
| 10,643 |
| |||||
* March 31, 2009 ratios are estimated
20
PARENT COMPANY ONLY BALANCE SHEETS
Comerica Incorporated
|
| March 31, |
| December 31, |
| March 31, |
| |||
(in millions, except share data) |
| 2009 |
| 2008 |
| 2008 |
| |||
|
|
|
|
|
|
|
| |||
ASSETS |
|
|
|
|
|
|
| |||
Cash and due from subsidiary bank |
| $ | 15 |
| $ | 11 |
| $ | 119 |
|
Short-term investments with subsidiary bank |
| 2,229 |
| 2,329 |
| 120 |
| |||
Other short-term investments |
| 75 |
| 80 |
| 103 |
| |||
Investment in subsidiaries, principally banks |
| 5,780 |
| 5,690 |
| 5,965 |
| |||
Premises and equipment |
| 4 |
| 5 |
| 3 |
| |||
Other assets |
| 216 |
| 210 |
| 187 |
| |||
Total assets |
| $ | 8,319 |
| $ | 8,325 |
| $ | 6,497 |
|
|
|
|
|
|
|
|
| |||
LIABILITIES AND SHAREHOLDERS’ EQUITY |
|
|
|
|
|
|
| |||
Medium- and long-term debt |
| $ | 999 |
| $ | 1,002 |
| $ | 981 |
|
Other liabilities |
| 137 |
| 171 |
| 259 |
| |||
Total liabilities |
| 1,136 |
| 1,173 |
| 1,240 |
| |||
|
|
|
|
|
|
|
| |||
Fixed rate cumulative perpetual preferred stock, series F, |
|
|
|
|
|
|
| |||
Authorized - 2,250,000 shares |
|
|
|
|
|
|
| |||
Issued - 2,250,000 shares at 3/31/09 and 12/31/08 |
| 2,134 |
| 2,129 |
| — |
| |||
Common stock - $5 par value: |
|
|
|
|
|
|
| |||
Authorized - 325,000,000 shares |
|
|
|
|
|
|
| |||
Issued - 178,735,252 shares at 03/31/09, 12/31/08 and 03/31/08 |
| 894 |
| 894 |
| 894 |
| |||
Capital surplus |
| 727 |
| 722 |
| 565 |
| |||
Accumulated other comprehensive loss |
| (238 | ) | (309 | ) | (67 | ) | |||
Retained earnings |
| 5,252 |
| 5,345 |
| 5,496 |
| |||
Less cost of common stock in treasury - 27,580,899 shares at 3/31/09, 28,244,967 shares at 12/31/08 and 28,233,996 shares at 3/31/08 |
| (1,586 | ) | (1,629 | ) | (1,631 | ) | |||
Total shareholders’ equity |
| 7,183 |
| 7,152 |
| 5,257 |
| |||
Total liabilities and shareholders’ equity |
| $ | 8,319 |
| $ | 8,325 |
| $ | 6,497 |
|
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY
Comerica Incorporated and Subsidiaries
|
|
|
|
|
|
|
|
|
| Accumulated |
|
|
|
|
|
|
| |||||||
|
| Nonredeemable |
| Common Stock |
|
|
| Other |
|
|
|
|
| Total |
| |||||||||
|
| Preferred |
| Shares |
|
|
| Capital |
| Comprehensive |
| Retained |
| Treasury |
| Shareholders’ |
| |||||||
(in millions, except per share data) |
| Stock |
| Outstanding |
| Amount |
| Surplus |
| Loss |
| Earnings |
| Stock |
| Equity |
| |||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
BALANCE AT JANUARY 1, 2008 |
| $ | — |
| 150.0 |
| $ | 894 |
| $ | 564 |
| $ | (177 | ) | $ | 5,497 |
| $ | (1,661 | ) | $ | 5,117 |
|
Net income |
| — |
| — |
| — |
| — |
| — |
| 109 |
| — |
| 109 |
| |||||||
Other comprehensive income, net of tax |
| — |
| — |
| — |
| — |
| 110 |
| — |
| — |
| 110 |
| |||||||
Total comprehensive income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 219 |
| |||||||
Cash dividends declared on common stock ($0.66 per share) |
| — |
| — |
| — |
| — |
| — |
| (99 | ) | — |
| (99 | ) | |||||||
Net issuance of common stock under employee stock plans |
| — |
| 0.5 |
| — |
| (20 | ) | — |
| (11 | ) | 31 |
| — |
| |||||||
Share-based compensation |
| — |
| — |
| — |
| 20 |
| — |
| — |
| — |
| 20 |
| |||||||
Employee deferred compensation obligations |
| — |
| — |
| — |
| 1 |
| — |
| — |
| (1 | ) | — |
| |||||||
BALANCE AT MARCH 31, 2008 |
| $ | — |
| 150.5 |
| $ | 894 |
| $ | 565 |
| $ | (67 | ) | $ | 5,496 |
| $ | (1,631 | ) | $ | 5,257 |
|
BALANCE AT JANUARY 1, 2009 |
| $ | 2,129 |
| 150.5 |
| $ | 894 |
| $ | 722 |
| $ | (309 | ) | $ | 5,345 |
| $ | (1,629 | ) | $ | 7,152 |
|
Net income |
| — |
| — |
| — |
| — |
| — |
| 9 |
| — |
| 9 |
| |||||||
Other comprehensive income, net of tax |
| — |
| — |
| — |
| — |
| 71 |
| — |
| — |
| 71 |
| |||||||
Total comprehensive income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 80 |
| |||||||
Cash dividends declared on preferred stock |
| — |
| — |
| — |
| — |
| — |
| (57 | ) | — |
| (57 | ) | |||||||
Cash dividends declared on common stock ($0.05 per share) |
| — |
| — |
| — |
| — |
| — |
| (7 | ) | — |
| (7 | ) | |||||||
Accretion of discount on preferred stock |
| 5 |
| — |
| — |
| — |
| — |
| (5 | ) | — |
| — |
| |||||||
Net issuance of common stock under employee stock plans |
| — |
| 0.7 |
| — |
| (12 | ) | — |
| (33 | ) | 43 |
| (2 | ) | |||||||
Share-based compensation |
| — |
| — |
| — |
| 11 |
| — |
| — |
| — |
| 11 |
| |||||||
Other |
| — |
| — |
| — |
| 6 |
| — |
| — |
| — |
| 6 |
| |||||||
BALANCE AT MARCH 31, 2009 |
| $ | 2,134 |
| 151.2 |
| $ | 894 |
| $ | 727 |
| $ | (238 | ) | $ | 5,252 |
| $ | (1,586 | ) | $ | 7,183 |
|
21
BUSINESS SEGMENT FINANCIAL RESULTS
Comerica Incorporated and Subsidiaries
|
|
|
|
|
| Wealth & |
|
|
|
|
|
|
| ||||||
(dollar amounts in millions) |
| Business |
| Retail |
| Institutional |
|
|
|
|
|
|
| ||||||
Three Months Ended March 31, 2009 |
| Bank |
| Bank |
| Management |
| Finance |
| Other |
| Total |
| ||||||
Earnings summary: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Net interest income (expense) (FTE) |
| $ | 312 |
| $ | 126 |
| $ | 36 |
| $ | (99 | ) | $ | 11 |
| $ | 386 |
|
Provision for loan losses |
| 177 |
| 23 |
| 10 |
| — |
| (7 | ) | 203 |
| ||||||
Noninterest income |
| 93 |
| 46 |
| 70 |
| 20 |
| (6 | ) | 223 |
| ||||||
Noninterest expenses |
| 157 |
| 161 |
| 75 |
| 4 |
| — |
| 397 |
| ||||||
Provision (benefit) for income taxes (FTE) |
| 15 |
| (5 | ) | 8 |
| (33 | ) | 16 |
| 1 |
| ||||||
Income from discontinued operations, net of tax |
| — |
| — |
| — |
| — |
| 1 |
| 1 |
| ||||||
Net income (loss) |
| $ | 56 |
| $ | (7 | ) | $ | 13 |
| $ | (50 | ) | $ | (3 | ) | $ | 9 |
|
Net credit-related charge-offs |
| $ | 123 |
| $ | 26 |
| $ | 8 |
| $ | — |
| $ | — |
| $ | 157 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Selected average balances: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Assets |
| $ | 39,505 |
| $ | 6,875 |
| $ | 4,870 |
| $ | 12,703 |
| $ | 2,784 |
| $ | 66,737 |
|
Loans |
| 38,527 |
| 6,284 |
| 4,750 |
| (4 | ) | (1 | ) | 49,556 |
| ||||||
Deposits |
| 14,040 |
| 17,391 |
| 2,429 |
| 6,786 |
| 136 |
| 40,782 |
| ||||||
Liabilities |
| 14,372 |
| 17,366 |
| 2,418 |
| 24,915 |
| 511 |
| 59,582 |
| ||||||
Attributed equity |
| 3,346 |
| 658 |
| 340 |
| 1,177 |
| 1,634 |
| 7,155 |
| ||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Statistical data: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Return on average assets (1) |
| 0.57 | % | (0.16 | )% | 1.10 | % | N/M |
| N/M |
| 0.06 | % | ||||||
Return on average attributed equity |
| 6.78 |
| (4.48 | ) | 15.80 |
| N/M |
| N/M |
| (1.90 | ) | ||||||
Net interest margin (2) |
| 3.28 |
| 2.93 |
| 3.11 |
| N/M |
| N/M |
| 2.53 |
| ||||||
Efficiency ratio |
| 38.55 |
| 94.01 |
| 74.09 |
| N/M |
| N/M |
| 66.61 |
| ||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
|
|
|
|
|
| Wealth & |
|
|
|
|
|
|
| ||||||
|
| Business |
| Retail |
| Institutional |
|
|
|
|
|
|
| ||||||
Three Months Ended December 31, 2008 |
| Bank |
| Bank |
| Management |
| Finance |
| Other |
| Total |
| ||||||
Earnings summary: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Net interest income (expense) (FTE) |
| $ | 329 |
| $ | 129 |
| $ | 38 |
| $ | (66 | ) | $ | 4 |
| $ | 434 |
|
Provision for loan losses |
| 138 |
| 44 |
| 13 |
| — |
| (3 | ) | 192 |
| ||||||
Noninterest income |
| 61 |
| 49 |
| 73 |
| 13 |
| (22 | ) | 174 |
| ||||||
Noninterest expenses |
| 172 |
| 180 |
| 80 |
| 3 |
| (24 | ) | 411 |
| ||||||
Provision (benefit) for income taxes (FTE) |
| 27 |
| (12 | ) | 5 |
| (19 | ) | (15 | ) | (14 | ) | ||||||
Income from discontinued operations, net of tax |
| — |
| — |
| — |
| — |
| 1 |
| 1 |
| ||||||
Net income (loss) |
| $ | 53 |
| $ | (34 | ) | $ | 13 |
| $ | (37 | ) | $ | 25 |
| $ | 20 |
|
Net credit-related charge-offs |
| $ | 101 |
| $ | 23 |
| $ | 9 |
| $ | — |
| $ | — |
| $ | 133 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Selected average balances: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Assets |
| $ | 41,332 |
| $ | 7,007 |
| $ | 4,879 |
| $ | 10,959 |
| $ | 1,804 |
| $ | 65,981 |
|
Loans |
| 40,245 |
| 6,379 |
| 4,724 |
| (4 | ) | (6 | ) | 51,338 |
| ||||||
Deposits |
| 13,789 |
| 17,065 |
| 2,255 |
| 6,892 |
| 315 |
| 40,316 |
| ||||||
Liabilities |
| 14,367 |
| 17,053 |
| 2,300 |
| 25,220 |
| 740 |
| 59,680 |
| ||||||
Attributed equity |
| 3,337 |
| 665 |
| 341 |
| 979 |
| 979 |
| 6,301 |
| ||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Statistical data: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Return on average assets (1) |
| 0.51 | % | (0.76 | )% | 1.05 | % | N/M |
| N/M |
| 0.12 | % | ||||||
Return on average attributed equity |
| 6.33 |
| (20.18 | ) | 15.03 |
| N/M |
| N/M |
| 0.19 |
| ||||||
Net interest margin (2) |
| 3.24 |
| 3.01 |
| 3.14 |
| N/M |
| N/M |
| 2.82 |
| ||||||
Efficiency ratio |
| 44.15 |
| 100.79 |
| 75.73 |
| N/M |
| N/M |
| 68.19 |
| ||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
|
|
|
|
|
| Wealth & |
|
|
|
|
|
|
| ||||||
|
| Business |
| Retail |
| Institutional |
|
|
|
|
|
|
| ||||||
Three Months Ended March 31, 2008 |
| Bank |
| Bank |
| Management |
| Finance |
| Other |
| Total |
| ||||||
Earnings summary: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Net interest income (expense) (FTE) |
| $ | 329 |
| $ | 148 |
| $ | 36 |
| $ | (26 | ) | $ | (10 | ) | $ | 477 |
|
Provision for loan losses |
| 146 |
| 18 |
| — |
| — |
| (5 | ) | 159 |
| ||||||
Noninterest income |
| 74 |
| 74 |
| 75 |
| 18 |
| (4 | ) | 237 |
| ||||||
Noninterest expenses |
| 177 |
| 142 |
| 79 |
| 3 |
| 2 |
| 403 |
| ||||||
Provision (benefit) for income taxes (FTE) |
| 18 |
| 22 |
| 12 |
| (8 | ) | (2 | ) | 42 |
| ||||||
Income from discontinued operations, net of tax |
| — |
| — |
| — |
| — |
| (1 | ) | (1 | ) | ||||||
Net income (loss) |
| $ | 62 |
| $ | 40 |
| $ | 20 |
| $ | (3 | ) | $ | (10 | ) | $ | 109 |
|
Net credit-related charge-offs |
| $ | 99 |
| $ | 10 |
| $ | 1 |
| $ | — |
| $ | — |
| $ | 110 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Selected average balances: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Assets |
| $ | 42,129 |
| $ | 7,144 |
| $ | 4,468 |
| $ | 8,645 |
| $ | 1,541 |
| $ | 63,927 |
|
Loans |
| 41,219 |
| 6,276 |
| 4,315 |
| 5 |
| 37 |
| 51,852 |
| ||||||
Deposits |
| 15,877 |
| 17,163 |
| 2,637 |
| 8,142 |
| 243 |
| 44,062 |
| ||||||
Liabilities |
| 16,686 |
| 17,171 |
| 2,646 |
| 21,636 |
| 596 |
| 58,735 |
| ||||||
Attributed equity |
| 3,168 |
| 725 |
| 331 |
| 903 |
| 65 |
| 5,192 |
| ||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Statistical data: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Return on average assets (1) |
| 0.59 | % | 0.89 | % | 1.79 | % | N/M |
| N/M |
| 0.68 | % | ||||||
Return on average attributed equity |
| 7.83 |
| 22.00 |
| 24.10 |
| N/M |
| N/M |
| 8.42 |
| ||||||
Net interest margin (2) |
| 3.21 |
| 3.48 |
| 3.34 |
| N/M |
| N/M |
| 3.22 |
| ||||||
Efficiency ratio |
| 44.05 |
| 70.99 |
| 70.95 |
| N/M |
| N/M |
| 58.25 |
| ||||||
(1) Return on average assets is calculated based on the greater of average assets or average liabilities and attributed equity.
(2) Net interest margin is calculated based on the greater of average earning assets or average deposits and purchased funds.
FTE — Fully Taxable Equivalent
N/M — Not Meaningful
22
MARKET SEGMENT FINANCIAL RESULTS
Comerica Incorporated and Subsidiaries
|
|
|
|
|
|
|
|
|
|
|
|
|
| Finance |
|
|
| ||||||||
(dollar amounts in millions) |
|
|
|
|
|
|
|
|
| Other |
|
|
| & Other |
|
|
| ||||||||
Three Months Ended March 31, 2009 |
| Midwest |
| Western |
| Texas |
| Florida |
| Markets |
| International |
| Businesses |
| Total |
| ||||||||
Earnings summary: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||
Net interest income (expense) (FTE) |
| $ | 194 |
| $ | 146 |
| $ | 70 |
| $ | 11 |
| $ | 39 |
| $ | 14 |
| $ | (88 | ) | $ | 386 |
|
Provision for loan losses |
| 83 |
| 88 |
| 9 |
| 15 |
| 15 |
| — |
| (7 | ) | 203 |
| ||||||||
Noninterest income |
| 127 |
| 36 |
| 21 |
| 3 |
| 14 |
| 8 |
| 14 |
| 223 |
| ||||||||
Noninterest expenses |
| 194 |
| 104 |
| 58 |
| 8 |
| 21 |
| 8 |
| 4 |
| 397 |
| ||||||||
Provision (benefit) for income taxes (FTE) |
| 15 |
| (3 | ) | 9 |
| (3 | ) | (5 | ) | 5 |
| (17 | ) | 1 |
| ||||||||
Income from discontinued operations, net of tax |
| — |
| — |
| — |
| — |
| — |
| — |
| 1 |
| 1 |
| ||||||||
Net income (loss) |
| $ | 29 |
| $ | (7 | ) | $ | 15 |
| $ | (6 | ) | $ | 22 |
| $ | 9 |
| $ | (53 | ) | $ | 9 |
|
Net credit-related charge-offs |
| $ | 54 |
| $ | 76 |
| $ | 8 |
| $ | 12 |
| $ | 6 |
| $ | 1 |
| $ | — |
| $ | 157 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||
Selected average balances: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||
Assets |
| $ | 19,139 |
| $ | 15,443 |
| $ | 8,069 |
| $ | 1,869 |
| $ | 4,553 |
| $ | 2,177 |
| $ | 15,487 |
| $ | 66,737 |
|
Loans |
| 18,267 |
| 15,253 |
| 7,847 |
| 1,878 |
| 4,246 |
| 2,070 |
| (5 | ) | 49,556 |
| ||||||||
Deposits |
| 16,699 |
| 10,640 |
| 4,198 |
| 253 |
| 1,357 |
| 713 |
| 6,922 |
| 40,782 |
| ||||||||
Liabilities |
| 17,014 |
| 10,571 |
| 4,211 |
| 245 |
| 1,413 |
| 702 |
| 25,426 |
| 59,582 |
| ||||||||
Attributed equity |
| 1,604 |
| 1,375 |
| 680 |
| 152 |
| 383 |
| 150 |
| 2,811 |
| 7,155 |
| ||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||
Statistical data: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||
Return on average assets (1) |
| 0.63 | % | (0.18 | )% | 0.72 | % | (1.29 | )% | 1.89 | % | 1.69 | % | N/M |
| 0.06 | % | ||||||||
Return on average attributed equity |
| 7.57 |
| (1.98 | ) | 8.54 |
| (15.87 | ) | 22.45 |
| 24.55 |
| N/M |
| (1.90 | ) | ||||||||
Net interest margin (2) |
| 4.30 |
| 3.91 |
| 3.62 |
| 2.31 |
| 3.65 |
| 2.74 |
| N/M |
| 2.53 |
| ||||||||
Efficiency ratio |
| 59.91 |
| 57.17 |
| 64.45 |
| 61.06 |
| 44.70 |
| 33.86 |
| N/M |
| 66.61 |
| ||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| Finance |
|
|
| ||||||||
|
|
|
|
|
|
|
|
|
| Other |
|
|
| & Other |
|
|
| ||||||||
Three Months Ended December 31, 2008 |
| Midwest |
| Western |
| Texas |
| Florida |
| Markets |
| International |
| Businesses |
| Total |
| ||||||||
Earnings summary: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||
Net interest income (expense) (FTE) |
| $ | 202 |
| $ | 157 |
| $ | 72 |
| $ | 11 |
| $ | 38 |
| $ | 16 |
| $ | (62 | ) | $ | 434 |
|
Provision for loan losses |
| 59 |
| 70 |
| 19 |
| 14 |
| 27 |
| 6 |
| (3 | ) | 192 |
| ||||||||
Noninterest income |
| 109 |
| 34 |
| 20 |
| 4 |
| 9 |
| 7 |
| (9 | ) | 174 |
| ||||||||
Noninterest expenses |
| 218 |
| 114 |
| 63 |
| 11 |
| 16 |
| 10 |
| (21 | ) | 411 |
| ||||||||
Provision (benefit) for income taxes (FTE) |
| 20 |
| 5 |
| 6 |
| (3 | ) | (11 | ) | 3 |
| (34 | ) | (14 | ) | ||||||||
Income from discontinued operations, net of tax |
| — |
| — |
| — |
| — |
| — |
| — |
| 1 |
| 1 |
| ||||||||
Net income (loss) |
| $ | 14 |
| $ | 2 |
| $ | 4 |
| $ | (7 | ) | $ | 15 |
| $ | 4 |
| $ | (12 | ) | $ | 20 |
|
Net credit-related charge-offs |
| $ | 38 |
| $ | 65 |
| $ | 8 |
| $ | 6 |
| $ | 16 |
| $ | — |
| $ | — |
| $ | 133 |
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Selected average balances: |
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|
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|
|
|
|
|
|
|
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|
|
|
|
| ||||||||
Assets |
| $ | 19,942 |
| $ | 16,243 |
| $ | 8,215 |
| $ | 1,938 |
| $ | 4,612 |
| $ | 2,268 |
| $ | 12,763 |
| $ | 65,981 |
|
Loans |
| 18,966 |
| 16,032 |
| 7,974 |
| 1,942 |
| 4,248 |
| 2,186 |
| (10 | ) | 51,338 |
| ||||||||
Deposits |
| 16,204 |
| 10,762 |
| 4,070 |
| 222 |
| 1,206 |
| 645 |
| 7,207 |
| 40,316 |
| ||||||||
Liabilities |
| 16,733 |
| 10,716 |
| 4,090 |
| 216 |
| 1,330 |
| 635 |
| 25,960 |
| 59,680 |
| ||||||||
Attributed equity |
| 1,613 |
| 1,381 |
| 650 |
| 146 |
| 405 |
| 148 |
| 1,958 |
| 6,301 |
| ||||||||
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| ||||||||
Statistical data: |
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| ||||||||
Return on average assets (1) |
| 0.28 | % | 0.05 | % | 0.20 | % | (1.46 | )% | 1.30 | % | 0.69 | % | N/M |
| 0.12 | % | ||||||||
Return on average attributed equity |
| 3.47 |
| 0.63 |
| 2.49 |
| (19.46 | ) | 14.86 |
| 10.62 |
| N/M |
| 0.19 |
| ||||||||
Net interest margin (2) |
| 4.21 |
| 3.88 |
| 3.57 |
| 2.26 |
| 3.55 |
| 2.83 |
| N/M |
| 2.82 |
| ||||||||
Efficiency ratio |
| 70.37 |
| 59.54 |
| 68.41 |
| 72.81 |
| 37.57 |
| 43.36 |
| N/M |
| 68.19 |
| ||||||||
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| Finance |
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| Other |
|
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| & Other |
|
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| ||||||||
Three Months Ended March 31, 2008 |
| Midwest |
| Western |
| Texas |
| Florida |
| Markets |
| International |
| Businesses |
| Total |
| ||||||||
Earnings summary: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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| ||||||||
Net interest income (expense) (FTE) |
| $ | 205 |
| $ | 172 |
| $ | 74 |
| $ | 11 |
| $ | 36 |
| $ | 15 |
| $ | (36 | ) | $ | 477 |
|
Provision for loan losses |
| 20 |
| 114 |
| 8 |
| 12 |
| 13 |
| (3 | ) | (5 | ) | 159 |
| ||||||||
Noninterest income |
| 136 |
| 33 |
| 24 |
| 5 |
| 17 |
| 8 |
| 14 |
| 237 |
| ||||||||
Noninterest expenses |
| 185 |
| 108 |
| 58 |
| 10 |
| 27 |
| 10 |
| 5 |
| 403 |
| ||||||||
Provision (benefit) for income taxes (FTE) |
| 48 |
| (7 | ) | 12 |
| (2 | ) | (5 | ) | 6 |
| (10 | ) | 42 |
| ||||||||
Income from discontinued operations, net of tax |
| — |
| — |
| — |
| — |
| — |
| — |
| (1 | ) | (1 | ) | ||||||||
Net income (loss) |
| $ | 88 |
| $ | (10 | ) | $ | 20 |
| $ | (4 | ) | $ | 18 |
| $ | 10 |
| $ | (13 | ) | $ | 109 |
|
Net credit-related charge-offs |
| $ | 28 |
| $ | 66 |
| $ | 5 |
| $ | 10 |
| $ | — |
| $ | 1 |
| $ | — |
| $ | 110 |
|
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| ||||||||
Selected average balances: |
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|
|
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|
|
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|
|
|
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| ||||||||
Assets |
| $ | 19,597 |
| $ | 17,287 |
| $ | 7,932 |
| $ | 1,891 |
| $ | 4,692 |
| $ | 2,342 |
| $ | 10,186 |
| $ | 63,927 |
|
Loans |
| 18,985 |
| 16,906 |
| 7,642 |
| 1,877 |
| 4,185 |
| 2,215 |
| 42 |
| 51,852 |
| ||||||||
Deposits |
| 16,079 |
| 12,849 |
| 4,005 |
| 362 |
| 1,582 |
| 800 |
| 8,385 |
| 44,062 |
| ||||||||
Liabilities |
| 16,768 |
| 12,849 |
| 4,022 |
| 358 |
| 1,690 |
| 816 |
| 22,232 |
| 58,735 |
| ||||||||
Attributed equity |
| 1,663 |
| 1,271 |
| 619 |
| 125 |
| 384 |
| 162 |
| 968 |
| 5,192 |
| ||||||||
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| ||||||||
Statistical data: |
|
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|
|
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|
|
|
|
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|
|
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| ||||||||
Return on average assets (1) |
| 1.78 | % | (0.24 | )% | 1.00 | % | (0.75 | )% | 1.55 | % | 1.78 | % | N/M |
| 0.68 | % | ||||||||
Return on average attributed equity |
| 20.93 |
| (3.20 | ) | 12.88 |
| (11.34 | ) | 18.93 |
| 25.73 |
| N/M |
| 8.42 |
| ||||||||
Net interest margin (2) |
| 4.32 |
| 4.08 |
| 3.84 |
| 2.56 |
| 3.39 |
| 2.71 |
| N/M |
| 3.22 |
| ||||||||
Efficiency ratio |
| 57.32 |
| 53.04 |
| 61.28 |
| 60.82 |
| 51.54 |
| 43.60 |
| N/M |
| 58.25 |
| ||||||||
(1) Return on average assets is calculated based on the greater of average assets or average liabilities and attributed equity.
(2) Net interest margin is calculated based on the greater of average earning assets or average deposits and purchased funds.
FTE — Fully Taxable Equivalent
N/M — Not Meaningful
23