DALLAS, July 17, 2012 /PRNewswire/ -- Comerica Incorporated (NYSE: CMA) today reported second quarter 2012 net income of $144 million, an increase of $14 million compared to $130 million for the first quarter 2012. Earnings per fully diluted share of 73 cents increased 7 cents, or 11 percent, compared to 66 cents for the first quarter 2012.
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(dollar amounts in millions, except per share data) |
2nd Qtr '12 |
1st Qtr '12 |
2nd Qtr '11 |
|||||||||
Net interest income |
$ |
435 |
$ |
443 |
$ |
391 |
||||||
Provision for credit losses |
19 |
22 |
45 |
|||||||||
Noninterest income |
211 |
206 |
202 |
|||||||||
Noninterest expenses |
433 |
(a) |
449 |
411 |
(a) | |||||||
Provision for income taxes |
50 |
48 |
41 |
|||||||||
Net income |
144 |
130 |
96 |
|||||||||
Net income attributable to common shares |
142 |
129 |
95 |
|||||||||
Diluted income per common share |
0.73 |
0.66 |
0.53 |
|||||||||
Average diluted shares (in millions) |
194 |
196 |
178 |
|||||||||
Tier 1 common capital ratio (c) |
10.32 |
% |
(b) |
10.27 |
% |
10.53 |
% |
|||||
Tangible common equity ratio (c) |
10.27 |
10.21 |
10.90 |
|||||||||
(a) |
Included restructuring expenses of $8 million ($5 million, after tax) and $5 million ($3 million, after tax) in the second quarter 2012 and 2011, respectively, associated with the acquisition of Sterling Bancshares, Inc. on July 28, 2011. | |||||||||||
(b) |
June 30, 2012 ratio is estimated. | |||||||||||
(c) |
See Reconciliation of Non-GAAP Financial Measures. |
"Our second quarter results reflect our focus on the bottom line in this slow growing national economy," said Ralph W. Babb Jr., chairman and chief executive officer. "Loans continued to grow, with average loans up $959 million, or 2 percent, compared to the first quarter, primarily reflecting an increase of $1.2 billion, or 5 percent, in commercial loans. This was the eighth consecutive quarter of average commercial loan growth, resulting in a 20 percent year-over-year increase, including our acquisition of Sterling Bancshares last July. The increase in average commercial loans in the second quarter was broad-based, primarily driven by increases in National Dealer Services, Global Corporate Banking, Middle Market Banking and Energy. As expected, this was partially offset by the continued decline in commercial real estate loans.
"Deposits continued to grow, credit quality remained solid, and we maintained our tight control of expenses.
"Our capital position remains a source of strength to support our future growth. We repurchased 2.9 million shares under our share repurchase program in the second quarter of 2012. In April, our Board of Directors increased the quarterly cash dividend 50 percent, to 15 cents per share. The combined share buyback and dividend returned 81 percent of second quarter net income to shareholders. We also have carefully reviewed the Basel III regulatory capital framework and believe that, on a fully phased-in pro forma basis, we are well above the proposed capital levels.
"Our consistent, conservative, relationship-focused approach to banking is making a positive difference for us and our customers."
Second Quarter 2012 Highlights Compared to First Quarter 2012
Net Interest Income
(dollar amounts in millions) |
2nd Qtr '12 |
1st Qtr '12 |
2nd Qtr '11 | ||||||||
Net interest income |
$ |
435 |
$ |
443 |
$ |
391 |
|||||
Net interest margin |
3.10 |
% |
3.19 |
% |
3.14 |
% | |||||
Selected average balances: |
|||||||||||
Total earning assets |
$ |
56,653 |
$ |
56,186 |
$ |
50,136 |
|||||
Total investment securities |
9,728 |
9,889 |
7,407 |
||||||||
Total loans |
43,228 |
42,269 |
39,174 |
||||||||
Total deposits |
48,679 |
48,311 |
41,480 |
||||||||
Total noninterest-bearing deposits |
20,128 |
19,637 |
15,786 |
||||||||
Noninterest Income
Noninterest income increased $5 million, to $211 million for the second quarter 2012. The increase primarily resulted from a $5 million annual incentive bonus received in the second quarter 2012 from Comerica's third party credit card provider, a $3 million increase in customer-driven fee income and a $3 million increase in net income from principal investing and warrants. Customer-driven fee income increased in the second quarter 2012, primarily due to a $5 million increase in customer derivative income, partially offset by a $3 million decrease in service charges on deposit accounts. Deferred compensation asset returns decreased $7 million in the second quarter 2012, compared to the first quarter 2012. The decrease in deferred compensation asset returns in noninterest income is offset by a decrease in deferred compensation plan expense in noninterest expenses.
Noninterest Expenses
Noninterest expenses totaled $433 million in the second quarter 2012, a decrease of $16 million compared to $449 million in the first quarter 2012. The decrease in noninterest expenses was primarily due to a decrease in salaries expense of $12 million, a $4 million decrease in other real estate expense, a $3 million decrease in litigation-related expense and smaller decreases in several other categories of noninterest expenses, partially offset by an increase in merger and restructuring charges of $8 million. The decrease in salaries expense primarily resulted from a $7 million decrease in deferred compensation plan expense and $5 million of stock grants expensed in the first quarter 2012. Restructuring charges of approximately $25 million to $30 million are expected to be incurred for the remainder of 2012.
Credit Quality
(dollar amounts in millions) |
2nd Qtr '12 |
1st Qtr '12 |
2nd Qtr '11 | |||||||||
Net credit-related charge-offs |
$ |
45 |
$ |
45 |
$ |
90 |
||||||
Net credit-related charge-offs/Average total loans |
0.42 |
% |
0.43 |
% |
0.92 |
% | ||||||
Provision for loan losses |
$ |
8 |
$ |
23 |
$ |
47 |
||||||
Provision for credit losses on lending-related commitments |
11 |
(1) |
(2) |
|||||||||
Total provision for credit losses |
19 |
22 |
45 |
|||||||||
Nonperforming loans (a) |
747 |
856 |
974 |
|||||||||
Nonperforming assets (NPAs) (a) |
814 |
923 |
1,044 |
|||||||||
NPAs/Total loans and foreclosed property |
1.85 |
% |
2.14 |
% |
2.66 |
% | ||||||
Loans past due 90 days or more and still accruing |
$ |
43 |
$ |
50 |
$ |
64 |
||||||
Allowance for loan losses |
667 |
704 |
806 |
|||||||||
Allowance for credit losses on lending-related commitments (b) |
36 |
25 |
30 |
|||||||||
Total allowance for credit losses |
703 |
729 |
836 |
|||||||||
Allowance for loan losses/Total loans (c) |
1.52 |
% |
1.64 |
% |
2.06 |
% | ||||||
Allowance for loan losses/Nonperforming loans |
89 |
82 |
83 |
|||||||||
(a) |
Excludes loans acquired with credit impairment. |
|||||||||||
(b) |
Included in "Accrued expenses and other liabilities" on the consolidated balance sheets. | |||||||||||
(c) |
Reflects the impact of acquired loans, which were initially recorded at fair value, with no related allowance for loan losses. |
"Credit quality continued to be strong," said Babb. "Net credit-related charge-offs were stable at $45 million, or 42 basis points of total loans. The provision for credit losses decreased $3 million to $19 million. We believe we will continue to see the provision and net charge-offs at or near these levels for the remainder of the year."
Balance Sheet and Capital Management
Total assets and common shareholders' equity were $62.7 billion and $7.0 billion, respectively, at June 30, 2012, compared to $62.6 billion and 7.0 billion, respectively, at March 31, 2012. There were approximately 194 million common shares outstanding at June 30, 2012. Comerica repurchased $88 million of common stock (2.9 million shares) under the share repurchase program during the second quarter 2012. Combined with the increased dividend of $0.15 per share in the second quarter, share repurchases and dividends returned 81 percent of second quarter 2012 net income to shareholders.
In the second quarter 2012, U.S. banking regulators issued proposed rules for the U.S. adoption of the Basel III regulatory capital framework. The proposals narrow the definition of capital, increase the minimum levels of required capital, introduce capital buffers and increase the risk weights for various asset classes. On a fully-phased-in pro forma basis, Comerica is currently estimated to be well above the proposed capital levels.
Comerica's tangible common equity ratio was 10.27% at June 30, 2012, an increase of 6 basis points from March 31, 2012. The estimated Tier 1 common capital ratio increased 5 basis points, to 10.32% at June 30, 2012, from March 31, 2012.
Full-Year 2012 Outlook Compared to Full-Year 2011
For 2012, management expects the following, assuming a continuation of the current economic environment:
Business Segments
Comerica's operations are strategically aligned into three major business segments: the Business Bank, the Retail Bank and Wealth Management. The Finance Division is also reported as a segment. The financial results below are based on the internal business unit structure of the Corporation and methodologies in effect at June 30, 2012 and are presented on a fully taxable equivalent (FTE) basis. The accompanying narrative addresses second quarter 2012 results compared to first quarter 2012.
The following table presents net income (loss) by business segment.
(dollar amounts in millions) |
2nd Qtr '12 |
1st Qtr '12 |
2nd Qtr '11 | ||||||||||||||
Business Bank |
$ |
210 |
84 |
% |
$ |
206 |
89 |
% |
$ |
176 |
95 |
% | |||||
Retail Bank |
19 |
8 |
14 |
6 |
(3) |
(2) |
|||||||||||
Wealth Management |
20 |
8 |
11 |
5 |
12 |
7 |
|||||||||||
249 |
100 |
% |
231 |
100 |
% |
185 |
100 |
% | |||||||||
Finance |
(95) |
(92) |
(86) |
||||||||||||||
Other (a) |
(10) |
(9) |
(3) |
||||||||||||||
Total |
$ |
144 |
$ |
130 |
$ |
96 |
(a) |
Includes items not directly associated with the three major business segments or the Finance Division. |
Business Bank
(dollar amounts in millions) |
2nd Qtr '12 |
1st Qtr '12 |
2nd Qtr '11 |
||||||||
Net interest income (FTE) |
$ |
385 |
$ |
379 |
$ |
342 |
|||||
Provision for credit losses |
12 |
2 |
2 |
||||||||
Noninterest income |
83 |
81 |
79 |
||||||||
Noninterest expenses |
151 |
158 |
162 |
||||||||
Net income |
210 |
206 |
176 |
||||||||
Net credit-related charge-offs |
26 |
28 |
54 |
||||||||
Selected average balances: |
|||||||||||
Assets |
34,376 |
33,184 |
29,893 |
||||||||
Loans |
33,449 |
32,238 |
29,427 |
||||||||
Deposits |
24,145 |
23,997 |
20,396 |
||||||||
Retail Bank
(dollar amounts in millions) |
2nd Qtr '12 |
1st Qtr '12 |
2nd Qtr '11 |
|||||||||
Net interest income (FTE) |
$ |
161 |
$ |
167 |
$ |
141 |
||||||
Provision for credit losses |
3 |
4 |
24 |
|||||||||
Noninterest income |
47 |
42 |
46 |
|||||||||
Noninterest expenses |
177 |
184 |
162 |
|||||||||
Net income (loss) |
19 |
14 |
(3) |
|||||||||
Net credit-related charge-offs |
9 |
12 |
22 |
|||||||||
Selected average balances: |
||||||||||||
Assets |
5,946 |
6,173 |
5,454 |
|||||||||
Loans |
5,250 |
5,462 |
4,999 |
|||||||||
Deposits |
20,525 |
20,373 |
17,737 |
|||||||||
Wealth Management
(dollar amounts in millions) |
2nd Qtr '12 |
1st Qtr '12 |
2nd Qtr '11 |
|||||||||
Net interest income (FTE) |
$ |
46 |
$ |
47 |
$ |
48 |
||||||
Provision for credit losses |
2 |
15 |
14 |
|||||||||
Noninterest income |
66 |
65 |
63 |
|||||||||
Noninterest expenses |
79 |
80 |
76 |
|||||||||
Net income |
20 |
11 |
12 |
|||||||||
Net credit-related charge-offs |
10 |
5 |
14 |
|||||||||
Selected average balances: |
||||||||||||
Assets |
4,604 |
4,636 |
4,728 |
|||||||||
Loans |
4,529 |
4,569 |
4,748 |
|||||||||
Deposits |
3,640 |
3,611 |
2,978 |
|||||||||
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 June 30, 2012 and are presented on a fully taxable equivalent (FTE) basis. The accompanying narrative addresses second quarter 2012 results compared to first quarter 2012.
The following table presents net income (loss) by market segment.
(dollar amounts in millions) |
2nd Qtr '12 |
1st Qtr '12 |
2nd Qtr '11 | ||||||||||||||
Midwest |
$ |
75 |
31 |
% |
$ |
68 |
30 |
% |
$ |
62 |
34 |
% | |||||
Western |
69 |
27 |
65 |
28 |
50 |
27 |
|||||||||||
Texas |
51 |
20 |
49 |
21 |
33 |
18 |
|||||||||||
Florida |
(5) |
(2) |
(1) |
— |
(5) |
(3) |
|||||||||||
Other Markets |
47 |
19 |
38 |
16 |
30 |
16 |
|||||||||||
International |
12 |
5 |
12 |
5 |
15 |
8 |
|||||||||||
249 |
100 |
% |
231 |
100 |
% |
185 |
100 |
% | |||||||||
Finance & Other (a) |
(105) |
(101) |
(89) |
||||||||||||||
Total |
$ |
144 |
$ |
130 |
$ |
96 |
(a) |
Includes items not directly associated with the geographic markets. |
Midwest Market
(dollar amounts in millions) |
2nd Qtr '12 |
1st Qtr '12 |
2nd Qtr '11 |
||||||||
Net interest income (FTE) |
$ |
196 |
$ |
198 |
$ |
204 |
|||||
Provision for credit losses |
1 |
11 |
15 |
||||||||
Noninterest income |
96 |
98 |
100 |
||||||||
Noninterest expenses |
177 |
182 |
183 |
||||||||
Net income |
75 |
68 |
62 |
||||||||
Net credit-related charge-offs |
10 |
18 |
37 |
||||||||
Selected average balances: |
|||||||||||
Assets |
14,028 |
14,095 |
14,262 |
||||||||
Loans |
13,766 |
13,825 |
14,050 |
||||||||
Deposits |
19,227 |
19,415 |
18,318 |
||||||||
Western Market
(dollar amounts in millions) |
2nd Qtr '12 |
1st Qtr '12 |
2nd Qtr '11 |
||||||||
Net interest income (FTE) |
$ |
177 |
$ |
171 |
$ |
166 |
|||||
Provision for credit losses |
1 |
(7) |
16 |
||||||||
Noninterest income |
37 |
33 |
37 |
||||||||
Noninterest expenses |
104 |
107 |
112 |
||||||||
Net income |
69 |
65 |
50 |
||||||||
Net credit-related charge-offs |
12 |
11 |
26 |
||||||||
Selected average balances: |
|||||||||||
Assets |
13,170 |
12,623 |
12,329 |
||||||||
Loans |
12,920 |
12,383 |
12,121 |
||||||||
Deposits |
14,371 |
13,897 |
12,458 |
||||||||
Texas Market
(dollar amounts in millions) |
2nd Qtr '12 |
1st Qtr '12 |
2nd Qtr '11 |
||||||||
Net interest income (FTE) |
$ |
143 |
$ |
151 |
$ |
89 |
|||||
Provision for credit losses |
7 |
14 |
(2) |
||||||||
Noninterest income |
31 |
31 |
25 |
||||||||
Noninterest expenses |
88 |
92 |
63 |
||||||||
Net income |
51 |
49 |
33 |
||||||||
Net credit-related charge-offs |
4 |
7 |
3 |
||||||||
Selected average balances: |
|||||||||||
Assets |
10,270 |
10,082 |
7,082 |
||||||||
Loans |
9,506 |
9,295 |
6,872 |
||||||||
Deposits |
10,185 |
10,229 |
6,176 |
||||||||
Florida Market
(dollar amounts in millions) |
2nd Qtr '12 |
1st Qtr '12 |
2nd Qtr '11 |
||||||||
Net interest income (FTE) |
$ |
11 |
$ |
10 |
$ |
12 |
|||||
Provision for credit losses |
11 |
6 |
12 |
||||||||
Noninterest income |
4 |
4 |
4 |
||||||||
Noninterest expenses |
11 |
9 |
11 |
||||||||
Net income |
(5) |
(1) |
(5) |
||||||||
Net credit-related charge-offs |
10 |
2 |
15 |
||||||||
Selected average balances: |
|||||||||||
Assets |
1,407 |
1,416 |
1,534 |
||||||||
Loans |
1,429 |
1,418 |
1,565 |
||||||||
Deposits |
446 |
424 |
396 |
||||||||
Conference Call and Webcast
Comerica will host a conference call to review second quarter 2012 financial results at 7 a.m. CT Tuesday, July 17, 2012. Interested parties may access the conference call by calling (800) 309-2262 or (706) 679-5261 (event ID No. 90096639). The call and supplemental financial information can also be accessed via Comerica's "Investor Relations" page at www.comerica.com. A telephone replay will be available approximately two hours following the conference call through July 31, 2012. The conference call replay can be accessed by calling (855) 859-2056 or (404) 537-3406 (event ID No. 90096639). 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 Management. Comerica focuses on relationships and helping people and businesses be successful. In addition to Texas, Comerica Bank locations can be found in Arizona, California, Florida and Michigan, with select businesses operating in several other states, as well as in Canada and Mexico.
This press release contains both financial measures based on accounting principles generally accepted in the United States (GAAP) and non-GAAP based financial measures, which are used where management believes it to be helpful in understanding Comerica's results of operations or financial position. Where non-GAAP financial measures are used, the comparable GAAP financial measure, as well as a reconciliation to the comparable GAAP financial measure, can be found in this press release. These disclosures should not be viewed as a substitute for operating results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies.
Forward-looking Statements
Any statements in this news release that are not historical facts are forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Words such as "anticipates," "believes," "contemplates," "feels," "expects," "estimates," "seeks," "strives," "plans," "intends," "outlook," "forecast," "position," "target," "mission," "assume," "achievable," "potential," "strategy," "goal," "aspiration," "opportunity," "initiative," "outcome," "continue," "remain," "maintain," "on course," "trend," "objective," "looks forward" and variations of such words and similar expressions, or future or conditional verbs such as "will," "would," "should," "could," "might," "can," "may" or similar expressions, as they relate to Comerica or its management, are intended to identify forward-looking statements. These forward-looking statements are predicated on the beliefs and assumptions of Comerica's management based on information known to Comerica's management as of the date of this news release and do not purport to speak as of any other date. Forward-looking statements may include descriptions of plans and objectives of Comerica's management for future or past operations, products or services, and forecasts of Comerica's revenue, earnings or other measures of economic performance, including statements of profitability, business segments and subsidiaries, estimates of credit trends and global stability. Such statements reflect the view of Comerica's management as of this date with respect to future events and are subject to risks and uncertainties. Should one or more of these risks materialize or should underlying beliefs or assumptions prove incorrect, Comerica's actual results could differ materially from those discussed. Factors that could cause or contribute to such differences are changes in general economic, political or industry conditions; changes in monetary and fiscal policies, including the interest rate policies of the Federal Reserve Board; volatility and disruptions in global capital and credit markets; changes in Comerica's credit rating; the interdependence of financial service companies; changes in regulation or oversight; unfavorable developments concerning credit quality; the acquisition of Sterling Bancshares, Inc., or any future acquisitions; the effects of more stringent capital or liquidity requirements; declines or other changes in the businesses or industries of Comerica's customers; the implementation of Comerica's strategies and business models, including the implementation of revenue enhancements and efficiency improvements; Comerica's ability to utilize technology to efficiently and effectively develop, market and deliver new products and services; operational difficulties, failure of technology infrastructure or information security incidents; changes in the financial markets, including fluctuations in interest rates and their impact on deposit pricing; competitive product and pricing pressures among financial institutions within Comerica's markets; changes in customer behavior; management's ability to maintain and expand customer relationships; management's ability to retain key officers and employees; the impact of legal and regulatory proceedings; the effectiveness of methods of reducing risk exposures; the effects of terrorist activities and other hostilities; the effects of catastrophic events including, but not limited to, hurricanes, tornadoes, earthquakes, fires, droughts and floods; changes in accounting standards and the critical nature of Comerica's accounting policies. Comerica cautions that the foregoing list of factors is not exclusive. For discussion of factors that may cause actual results to differ from expectations, please refer to our filings with the Securities and Exchange Commission. In particular, please refer to "Item 1A. Risk Factors" beginning on page 12 of Comerica's Annual Report on Form 10-K for the year ended December 31, 2011. Forward-looking statements speak only as of the date they are made. Comerica does not undertake to update forward-looking statements to reflect facts, circumstances, assumptions or events that occur after the date the forward-looking statements are made. For any forward-looking statements made in this news release or in any documents, Comerica claims the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995.
CONSOLIDATED FINANCIAL HIGHLIGHTS (unaudited) |
|||||||||||||||||
Comerica Incorporated and Subsidiaries |
|||||||||||||||||
Three Months Ended |
Six Months Ended | ||||||||||||||||
June 30, |
March 31, |
June 30, |
June 30, | ||||||||||||||
(in millions, except per share data) |
2012 |
2012 |
2011 |
2012 |
2011 | ||||||||||||
PER COMMON SHARE AND COMMON STOCK DATA |
|||||||||||||||||
Diluted net income |
$ |
0.73 |
$ |
0.66 |
$ |
0.53 |
$ |
1.39 |
$ |
1.10 |
|||||||
Cash dividends declared |
0.15 |
0.10 |
0.10 |
0.25 |
0.20 |
||||||||||||
Common shareholders' equity (at period end) |
36.18 |
35.44 |
34.15 |
||||||||||||||
Tangible common equity (at period end) (a) |
32.76 |
32.06 |
33.28 |
||||||||||||||
Average diluted shares (in thousands) |
194,487 |
196,021 |
177,602 |
195,254 |
178,011 |
||||||||||||
KEY RATIOS |
|||||||||||||||||
Return on average common shareholders' equity |
8.22 |
% |
7.50 |
% |
6.41 |
% |
7.86 |
% |
6.74 |
% | |||||||
Return on average assets |
0.93 |
0.84 |
0.70 |
0.89 |
0.73 |
||||||||||||
Tier 1 common capital ratio (a) (b) |
10.32 |
10.27 |
10.53 |
||||||||||||||
Tier 1 risk-based capital ratio (b) |
10.32 |
10.27 |
10.53 |
||||||||||||||
Total risk-based capital ratio (b) |
13.82 |
13.99 |
14.80 |
||||||||||||||
Leverage ratio (b) |
10.92 |
10.94 |
11.40 |
||||||||||||||
Tangible common equity ratio (a) |
10.27 |
10.21 |
10.90 |
||||||||||||||
AVERAGE BALANCES |
|||||||||||||||||
Commercial loans |
$ |
25,983 |
$ |
24,736 |
$ |
21,677 |
$ |
25,359 |
$ |
21,586 |
|||||||
Real estate construction loans: |
|||||||||||||||||
Commercial Real Estate business line (c) |
1,035 |
1,056 |
1,486 |
1,046 |
1,619 |
||||||||||||
Other business lines (d) |
385 |
397 |
395 |
391 |
410 |
||||||||||||
Total real estate construction loans |
1,420 |
1,453 |
1,881 |
1,437 |
2,029 |
||||||||||||
Commercial mortgage loans: |
|||||||||||||||||
Commercial Real Estate business line (c) |
2,443 |
2,520 |
1,912 |
2,482 |
1,945 |
||||||||||||
Other business lines (d) |
7,540 |
7,682 |
7,724 |
7,611 |
7,768 |
||||||||||||
Total commercial mortgage loans |
9,983 |
10,202 |
9,636 |
10,093 |
9,713 |
||||||||||||
Lease financing |
869 |
897 |
958 |
883 |
972 |
||||||||||||
International loans |
1,265 |
1,205 |
1,254 |
1,235 |
1,237 |
||||||||||||
Residential mortgage loans |
1,487 |
1,519 |
1,525 |
1,503 |
1,562 |
||||||||||||
Consumer loans |
2,221 |
2,257 |
2,243 |
2,239 |
2,262 |
||||||||||||
Total loans |
43,228 |
42,269 |
39,174 |
42,749 |
39,361 |
||||||||||||
Earning assets |
56,653 |
56,186 |
50,136 |
56,419 |
49,473 |
||||||||||||
Total assets |
61,950 |
61,613 |
54,517 |
61,782 |
54,148 |
||||||||||||
Noninterest-bearing deposits |
20,128 |
19,637 |
15,786 |
19,882 |
15,623 |
||||||||||||
Interest-bearing deposits |
28,551 |
28,674 |
25,694 |
28,613 |
25,418 |
||||||||||||
Total deposits |
48,679 |
48,311 |
41,480 |
48,495 |
41,041 |
||||||||||||
Common shareholders' equity |
7,002 |
6,939 |
5,972 |
6,971 |
5,904 |
||||||||||||
NET INTEREST INCOME |
|||||||||||||||||
Net interest income (fully taxable equivalent basis) |
$ |
435 |
$ |
444 |
$ |
392 |
$ |
879 |
$ |
788 |
|||||||
Fully taxable equivalent adjustment |
— |
1 |
1 |
1 |
2 |
||||||||||||
Net interest margin (fully taxable equivalent basis) |
3.10 |
% |
3.19 |
% |
3.14 |
% |
3.14 |
% |
3.19 |
% | |||||||
CREDIT QUALITY |
|||||||||||||||||
Nonaccrual loans |
$ |
719 |
$ |
830 |
$ |
941 |
|||||||||||
Reduced-rate loans |
28 |
26 |
33 |
||||||||||||||
Total nonperforming loans (e) |
747 |
856 |
974 |
||||||||||||||
Foreclosed property |
67 |
67 |
70 |
||||||||||||||
Total nonperforming assets (e) |
814 |
923 |
1,044 |
||||||||||||||
Loans past due 90 days or more and still accruing |
43 |
50 |
64 |
||||||||||||||
Gross loan charge-offs |
64 |
62 |
125 |
$ |
126 |
$ |
248 |
||||||||||
Loan recoveries |
19 |
17 |
35 |
36 |
57 |
||||||||||||
Net loan charge-offs |
45 |
45 |
90 |
90 |
191 |
||||||||||||
Allowance for loan losses |
667 |
704 |
806 |
||||||||||||||
Allowance for credit losses on lending-related commitments |
36 |
25 |
30 |
||||||||||||||
Total allowance for credit losses |
703 |
729 |
836 |
||||||||||||||
Allowance for loan losses as a percentage of total loans (f) |
1.52 |
% |
1.64 |
% |
2.06 |
% |
|||||||||||
Net loan charge-offs as a percentage of average total loans (g) |
0.42 |
0.43 |
0.92 |
0.42 |
% |
0.97 |
% | ||||||||||
Nonperforming assets as a percentage of total loans and foreclosed property (e) |
1.85 |
2.14 |
2.66 |
||||||||||||||
Allowance for loan losses as a percentage of total nonperforming loans |
89 |
82 |
83 |
||||||||||||||
(a) |
See Reconciliation of Non-GAAP Financial Measures. |
||||||||||||||||
(b) |
June 30, 2012 ratios are estimated. | ||||||||||||||||
(c) |
Primarily loans to real estate investors and developers. | ||||||||||||||||
(d) |
Primarily loans secured by owner-occupied real estate. | ||||||||||||||||
(e) |
Excludes loans acquired with credit-impairment. | ||||||||||||||||
(f) |
Reflects the impact of acquired loans, which were initially recorded at fair value with no related allowance for loan losses. | ||||||||||||||||
(g) |
Lending-related commitment charge-offs were zero in all periods presented. |
CONSOLIDATED BALANCE SHEETS |
||||||||||||
Comerica Incorporated and Subsidiaries |
||||||||||||
June 30, |
March 31, |
December 31, |
June 30, | |||||||||
(in millions, except share data) |
2012 |
2012 |
2011 |
2011 | ||||||||
(unaudited) |
(unaudited) |
(unaudited) | ||||||||||
ASSETS |
||||||||||||
Cash and due from banks |
$ |
1,076 |
$ |
984 |
$ |
982 |
$ |
987 |
||||
Interest-bearing deposits with banks |
3,065 |
2,976 |
2,574 |
2,479 |
||||||||
Other short-term investments |
170 |
180 |
149 |
124 |
||||||||
Investment securities available-for-sale |
9,940 |
10,061 |
10,104 |
7,537 |
||||||||
Commercial loans |
27,016 |
25,640 |
24,996 |
22,052 |
||||||||
Real estate construction loans |
1,377 |
1,442 |
1,533 |
1,728 |
||||||||
Commercial mortgage loans |
9,830 |
10,079 |
10,264 |
9,579 |
||||||||
Lease financing |
858 |
872 |
905 |
949 |
||||||||
International loans |
1,224 |
1,256 |
1,170 |
1,162 |
||||||||
Residential mortgage loans |
1,469 |
1,485 |
1,526 |
1,491 |
||||||||
Consumer loans |
2,218 |
2,238 |
2,285 |
2,232 |
||||||||
Total loans |
43,992 |
43,012 |
42,679 |
39,193 |
||||||||
Less allowance for loan losses |
(667) |
(704) |
(726) |
(806) |
||||||||
Net loans |
43,325 |
42,308 |
41,953 |
38,387 |
||||||||
Premises and equipment |
667 |
670 |
675 |
641 |
||||||||
Accrued income and other assets |
4,407 |
5,414 |
4,571 |
3,986 |
||||||||
Total assets |
$ |
62,650 |
$ |
62,593 |
$ |
61,008 |
$ |
54,141 |
||||
LIABILITIES AND SHAREHOLDERS' EQUITY |
||||||||||||
Noninterest-bearing deposits |
$ |
21,330 |
$ |
20,741 |
$ |
19,764 |
$ |
16,344 |
||||
Money market and interest-bearing checking deposits |
20,008 |
20,502 |
20,311 |
18,033 |
||||||||
Savings deposits |
1,629 |
1,586 |
1,524 |
1,462 |
||||||||
Customer certificates of deposit |
6,045 |
6,145 |
5,808 |
5,551 |
||||||||
Foreign office time deposits |
376 |
332 |
348 |
368 |
||||||||
Total interest-bearing deposits |
28,058 |
28,565 |
27,991 |
25,414 |
||||||||
Total deposits |
49,388 |
49,306 |
47,755 |
41,758 |
||||||||
Short-term borrowings |
83 |
82 |
70 |
67 |
||||||||
Accrued expenses and other liabilities |
1,409 |
1,301 |
1,371 |
1,072 |
||||||||
Medium- and long-term debt |
4,742 |
4,919 |
4,944 |
5,206 |
||||||||
Total liabilities |
55,622 |
55,608 |
54,140 |
48,103 |
||||||||
Common stock - $5 par value: |
||||||||||||
Authorized - 325,000,000 shares |
||||||||||||
Issued - 228,164,824 shares at 6/30/12, 3/31/12 and 12/31/11 |
||||||||||||
and 203,878,110 shares at 6/30/11 |
1,141 |
1,141 |
1,141 |
1,019 |
||||||||
Capital surplus |
2,144 |
2,154 |
2,170 |
1,472 |
||||||||
Accumulated other comprehensive loss |
(301) |
(326) |
(356) |
(308) |
||||||||
Retained earnings |
5,744 |
5,630 |
5,546 |
5,395 |
||||||||
Less cost of common stock in treasury - 33,889,392 shares at 6/30/12, 31,032,920 shares |
||||||||||||
at 3/31/12, 30,831,076 shares at 12/31/11 and 27,092,427 shares at 6/30/11 |
(1,700) |
(1,614) |
(1,633) |
(1,540) |
||||||||
Total shareholders' equity |
7,028 |
6,985 |
6,868 |
6,038 |
||||||||
Total liabilities and shareholders' equity |
$ |
62,650 |
$ |
62,593 |
$ |
61,008 |
$ |
54,141 |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (unaudited) |
|||||||||||||
Comerica Incorporated and Subsidiaries |
|||||||||||||
Three Months Ended |
Six Months Ended | ||||||||||||
June 30, |
June 30, | ||||||||||||
(in millions, except per share data) |
2012 |
2011 |
2012 |
2011 | |||||||||
INTEREST INCOME |
|||||||||||||
Interest and fees on loans |
$ |
408 |
$ |
369 |
$ |
819 |
$ |
744 |
|||||
Interest on investment securities |
59 |
59 |
123 |
116 |
|||||||||
Interest on short-term investments |
3 |
3 |
6 |
5 |
|||||||||
Total interest income |
470 |
431 |
948 |
865 |
|||||||||
INTEREST EXPENSE |
|||||||||||||
Interest on deposits |
18 |
23 |
37 |
45 |
|||||||||
Interest on medium- and long-term debt |
17 |
17 |
33 |
34 |
|||||||||
Total interest expense |
35 |
40 |
70 |
79 |
|||||||||
Net interest income |
435 |
391 |
878 |
786 |
|||||||||
Provision for credit losses |
19 |
45 |
41 |
91 |
|||||||||
Net interest income after provision for credit losses |
416 |
346 |
837 |
695 |
|||||||||
NONINTEREST INCOME |
|||||||||||||
Service charges on deposit accounts |
53 |
51 |
109 |
103 |
|||||||||
Fiduciary income |
39 |
39 |
77 |
78 |
|||||||||
Commercial lending fees |
24 |
21 |
49 |
42 |
|||||||||
Letter of credit fees |
18 |
18 |
35 |
36 |
|||||||||
Card fees |
12 |
15 |
23 |
30 |
|||||||||
Foreign exchange income |
10 |
10 |
19 |
19 |
|||||||||
Bank-owned life insurance |
10 |
9 |
20 |
17 |
|||||||||
Brokerage fees |
5 |
6 |
11 |
12 |
|||||||||
Net securities gains |
6 |
4 |
11 |
6 |
|||||||||
Other noninterest income |
34 |
29 |
63 |
66 |
|||||||||
Total noninterest income |
211 |
202 |
417 |
409 |
|||||||||
NONINTEREST EXPENSES |
|||||||||||||
Salaries |
189 |
185 |
390 |
373 |
|||||||||
Employee benefits |
61 |
50 |
121 |
100 |
|||||||||
Total salaries and employee benefits |
250 |
235 |
511 |
473 |
|||||||||
Net occupancy expense |
40 |
38 |
81 |
78 |
|||||||||
Equipment expense |
16 |
17 |
33 |
32 |
|||||||||
Outside processing fee expense |
26 |
25 |
52 |
49 |
|||||||||
Software expense |
21 |
20 |
44 |
43 |
|||||||||
Merger and restructuring charges |
8 |
5 |
8 |
5 |
|||||||||
FDIC insurance expense |
10 |
12 |
20 |
27 |
|||||||||
Advertising expense |
7 |
7 |
14 |
14 |
|||||||||
Other real estate expense |
— |
6 |
4 |
14 |
|||||||||
Other noninterest expenses |
55 |
46 |
115 |
94 |
|||||||||
Total noninterest expenses |
433 |
411 |
882 |
829 |
|||||||||
Income before income taxes |
194 |
137 |
372 |
275 |
|||||||||
Provision for income taxes |
50 |
41 |
98 |
76 |
|||||||||
NET INCOME |
144 |
96 |
274 |
199 |
|||||||||
Less income allocated to participating securities |
2 |
1 |
3 |
2 |
|||||||||
Net income attributable to common shares |
$ |
142 |
$ |
95 |
$ |
271 |
$ |
197 |
|||||
Earnings per common share: |
|||||||||||||
Basic |
$ |
0.73 |
$ |
0.54 |
$ |
1.39 |
$ |
1.12 |
|||||
Diluted |
0.73 |
0.53 |
1.39 |
1.10 |
|||||||||
Comprehensive income |
169 |
170 |
329 |
280 |
|||||||||
Cash dividends declared on common stock |
29 |
18 |
49 |
35 |
|||||||||
Cash dividends declared per common share |
0.15 |
0.10 |
0.25 |
0.20 |
CONSOLIDATED QUARTERLY STATEMENTS OF COMPREHENSIVE INCOME (unaudited) |
|||||||||||||||||||||||||||
Comerica Incorporated and Subsidiaries |
|||||||||||||||||||||||||||
Second |
First |
Fourth |
Third |
Second |
Second Quarter 2012 Compared To: | ||||||||||||||||||||||
Quarter |
Quarter |
Quarter |
Quarter |
Quarter |
First Quarter 2012 |
Second Quarter 2011 | |||||||||||||||||||||
(in millions, except per share data) |
2012 |
2012 |
2011 |
2011 |
2011 |
Amount |
Percent |
Amount |
Percent | ||||||||||||||||||
INTEREST INCOME |
|||||||||||||||||||||||||||
Interest and fees on loans |
$ |
408 |
$ |
411 |
$ |
415 |
$ |
405 |
$ |
369 |
$ |
(3) |
(1) |
% |
$ |
39 |
10 |
% | |||||||||
Interest on investment securities |
59 |
64 |
63 |
54 |
59 |
(5) |
(7) |
— |
1 |
||||||||||||||||||
Interest on short-term investments |
3 |
3 |
3 |
4 |
3 |
— |
(11) |
— |
10 |
||||||||||||||||||
Total interest income |
470 |
478 |
481 |
463 |
431 |
(8) |
(2) |
39 |
9 |
||||||||||||||||||
INTEREST EXPENSE |
|||||||||||||||||||||||||||
Interest on deposits |
18 |
19 |
21 |
24 |
23 |
(1) |
(5) |
(5) |
(21) |
||||||||||||||||||
Interest on medium- and long-term debt |
17 |
16 |
16 |
16 |
17 |
1 |
3 |
— |
(3) |
||||||||||||||||||
Total interest expense |
35 |
35 |
37 |
40 |
40 |
— |
(1) |
(5) |
(13) |
||||||||||||||||||
Net interest income |
435 |
443 |
444 |
423 |
391 |
(8) |
(2) |
44 |
11 |
||||||||||||||||||
Provision for credit losses |
19 |
22 |
18 |
35 |
45 |
(3) |
(11) |
(26) |
(57) |
||||||||||||||||||
Net interest income after provision for credit losses |
416 |
421 |
426 |
388 |
346 |
(5) |
(2) |
70 |
20 |
||||||||||||||||||
NONINTEREST INCOME |
|||||||||||||||||||||||||||
Service charges on deposit accounts |
53 |
56 |
52 |
53 |
51 |
(3) |
(3) |
2 |
6 |
||||||||||||||||||
Fiduciary income |
39 |
38 |
36 |
37 |
39 |
1 |
3 |
— |
— |
||||||||||||||||||
Commercial lending fees |
24 |
25 |
23 |
22 |
21 |
(1) |
(3) |
3 |
13 |
||||||||||||||||||
Letter of credit fees |
18 |
17 |
18 |
19 |
18 |
1 |
1 |
— |
(5) |
||||||||||||||||||
Card fees |
12 |
11 |
11 |
17 |
15 |
1 |
4 |
(3) |
(26) |
||||||||||||||||||
Foreign exchange income |
10 |
9 |
10 |
11 |
10 |
1 |
2 |
— |
1 |
||||||||||||||||||
Bank-owned life insurance |
10 |
10 |
10 |
10 |
9 |
— |
2 |
1 |
17 |
||||||||||||||||||
Brokerage fees |
5 |
6 |
5 |
5 |
6 |
(1) |
(10) |
(1) |
(11) |
||||||||||||||||||
Net securities gains (losses) |
6 |
5 |
(4) |
12 |
4 |
1 |
27 |
2 |
50 |
||||||||||||||||||
Other noninterest income |
34 |
29 |
21 |
15 |
29 |
5 |
16 |
5 |
18 |
||||||||||||||||||
Total noninterest income |
211 |
206 |
182 |
201 |
202 |
5 |
2 |
9 |
4 |
||||||||||||||||||
NONINTEREST EXPENSES |
|||||||||||||||||||||||||||
Salaries |
189 |
201 |
205 |
192 |
185 |
(12) |
(6) |
4 |
2 |
||||||||||||||||||
Employee benefits |
61 |
60 |
52 |
53 |
50 |
1 |
2 |
11 |
21 |
||||||||||||||||||
Total salaries and employee benefits |
250 |
261 |
257 |
245 |
235 |
(11) |
(4) |
15 |
6 |
||||||||||||||||||
Net occupancy expense |
40 |
41 |
47 |
44 |
38 |
(1) |
(4) |
2 |
2 |
||||||||||||||||||
Equipment expense |
16 |
17 |
17 |
17 |
17 |
(1) |
(3) |
(1) |
— |
||||||||||||||||||
Outside processing fee expense |
26 |
26 |
27 |
25 |
25 |
— |
2 |
1 |
6 |
||||||||||||||||||
Software expense |
21 |
23 |
23 |
22 |
20 |
(2) |
(5) |
1 |
4 |
||||||||||||||||||
Merger and restructuring charges |
8 |
— |
37 |
33 |
5 |
8 |
N/M |
3 |
37 |
||||||||||||||||||
FDIC insurance expense |
10 |
10 |
8 |
8 |
12 |
— |
(8) |
(2) |
(25) |
||||||||||||||||||
Advertising expense |
7 |
7 |
7 |
7 |
7 |
— |
— |
— |
— |
||||||||||||||||||
Other real estate expense |
— |
4 |
3 |
5 |
6 |
(4) |
(76) |
(6) |
(84) |
||||||||||||||||||
Other noninterest expenses |
55 |
60 |
53 |
57 |
46 |
(5) |
(10) |
9 |
20 |
||||||||||||||||||
Total noninterest expenses |
433 |
449 |
479 |
463 |
411 |
(16) |
(4) |
22 |
5 |
||||||||||||||||||
Income before income taxes |
194 |
178 |
129 |
126 |
137 |
16 |
9 |
57 |
42 |
||||||||||||||||||
Provision for income taxes |
50 |
48 |
33 |
28 |
41 |
2 |
5 |
9 |
21 |
||||||||||||||||||
NET INCOME |
144 |
130 |
96 |
98 |
96 |
14 |
11 |
48 |
50 |
||||||||||||||||||
Less income allocated to participating securities |
2 |
1 |
1 |
1 |
1 |
1 |
7 |
1 |
52 |
||||||||||||||||||
Net income attributable to common shares |
$ |
142 |
$ |
129 |
$ |
95 |
$ |
97 |
$ |
95 |
$ |
13 |
11 |
% |
$ |
47 |
50 |
% | |||||||||
Earnings per common share: |
|||||||||||||||||||||||||||
Basic |
$ |
0.73 |
$ |
0.66 |
$ |
0.48 |
$ |
0.51 |
$ |
0.54 |
$ |
0.07 |
11 |
% |
$ |
0.19 |
35 |
% | |||||||||
Diluted |
0.73 |
0.66 |
0.48 |
0.51 |
0.53 |
0.07 |
11 |
0.20 |
38 |
||||||||||||||||||
Comprehensive income (loss) |
169 |
160 |
(30) |
176 |
170 |
9 |
5 |
(1) |
(1) |
||||||||||||||||||
Cash dividends declared on common stock |
29 |
20 |
20 |
20 |
18 |
9 |
49 |
11 |
65 |
||||||||||||||||||
Cash dividends declared per common share |
0.15 |
0.10 |
0.10 |
0.10 |
0.10 |
0.05 |
50 |
0.05 |
50 |
N/M - Not Meaningful |
ANALYSIS OF THE ALLOWANCE FOR LOAN LOSSES (unaudited) | |||||||||||||||||
Comerica Incorporated and Subsidiaries |
|||||||||||||||||
2012 |
2011 | ||||||||||||||||
(in millions) |
2nd Qtr |
1st Qtr |
4th Qtr |
3rd Qtr |
2nd Qtr | ||||||||||||
Balance at beginning of period |
$ |
704 |
$ |
726 |
$ |
767 |
$ |
806 |
$ |
849 |
|||||||
Loan charge-offs: |
|||||||||||||||||
Commercial |
26 |
25 |
28 |
33 |
66 |
||||||||||||
Real estate construction: |
|||||||||||||||||
Commercial Real Estate business line (a) |
2 |
2 |
4 |
11 |
12 |
||||||||||||
Other business lines (b) |
1 |
— |
1 |
— |
— |
||||||||||||
Total real estate construction |
3 |
2 |
5 |
11 |
12 |
||||||||||||
Commercial mortgage: |
|||||||||||||||||
Commercial Real Estate business line (a) |
16 |
13 |
17 |
12 |
8 |
||||||||||||
Other business lines (b) |
11 |
13 |
24 |
21 |
23 |
||||||||||||
Total commercial mortgage |
27 |
26 |
41 |
33 |
31 |
||||||||||||
International |
— |
2 |
2 |
— |
— |
||||||||||||
Residential mortgage |
3 |
2 |
2 |
4 |
7 |
||||||||||||
Consumer |
5 |
5 |
7 |
9 |
9 |
||||||||||||
Total loan charge-offs |
64 |
62 |
85 |
90 |
125 |
||||||||||||
Recoveries on loans previously charged-off: |
|||||||||||||||||
Commercial |
10 |
9 |
11 |
5 |
13 |
||||||||||||
Real estate construction |
1 |
1 |
4 |
3 |
5 |
||||||||||||
Commercial mortgage |
4 |
3 |
9 |
3 |
5 |
||||||||||||
Lease financing |
— |
— |
— |
— |
6 |
||||||||||||
International |
— |
1 |
— |
— |
4 |
||||||||||||
Residential mortgage |
— |
1 |
— |
1 |
1 |
||||||||||||
Consumer |
4 |
2 |
1 |
1 |
1 |
||||||||||||
Total recoveries |
19 |
17 |
25 |
13 |
35 |
||||||||||||
Net loan charge-offs |
45 |
45 |
60 |
77 |
90 |
||||||||||||
Provision for loan losses |
8 |
23 |
19 |
38 |
47 |
||||||||||||
Balance at end of period |
$ |
667 |
$ |
704 |
$ |
726 |
$ |
767 |
$ |
806 |
|||||||
Allowance for loan losses as a percentage of total loans (c) |
1.52 |
% |
1.64 |
% |
1.70 |
% |
1.86 |
% |
2.06 |
% | |||||||
Net loan charge-offs as a percentage of average total loans |
0.42 |
0.43 |
0.57 |
0.77 |
0.92 |
||||||||||||
(a) |
Primarily charge-offs of loans to real estate investors and developers. | ||||||||||||||||
(b) |
Primarily charge-offs of loans secured by owner-occupied real estate. | ||||||||||||||||
(c) |
Reflects the impact of acquired loans, which were initially recorded at fair value with no related allowance for loan losses. |
ANALYSIS OF THE ALLOWANCE FOR CREDIT LOSSES ON LENDING-RELATED COMMITMENTS (unaudited) | ||||||||||||||||
Comerica Incorporated and Subsidiaries |
||||||||||||||||
2012 |
2011 | |||||||||||||||
(in millions) |
2nd Qtr |
1st Qtr |
4th Qtr |
3rd Qtr |
2nd Qtr | |||||||||||
Balance at beginning of period |
$ |
25 |
$ |
26 |
$ |
27 |
$ |
30 |
$ |
32 |
||||||
Add: Provision for credit losses on lending-related commitments |
11 |
(1) |
(1) |
(3) |
(2) |
|||||||||||
Balance at end of period |
$ |
36 |
$ |
25 |
$ |
26 |
$ |
27 |
$ |
30 |
||||||
Unfunded lending-related commitments sold |
$ |
— |
$ |
— |
$ |
— |
$ |
— |
$ |
3 |
NONPERFORMING ASSETS (unaudited) |
||||||||||||||||
Comerica Incorporated and Subsidiaries |
||||||||||||||||
2012 |
2011 | |||||||||||||||
(in millions) |
2nd Qtr |
1st Qtr |
4th Qtr |
3rd Qtr |
2nd Qtr | |||||||||||
SUMMARY OF NONPERFORMING ASSETS AND PAST DUE LOANS |
||||||||||||||||
Nonaccrual loans: |
||||||||||||||||
Business loans: |
||||||||||||||||
Commercial |
$ |
175 |
$ |
205 |
$ |
237 |
$ |
258 |
$ |
261 |
||||||
Real estate construction: |
||||||||||||||||
Commercial Real Estate business line (a) |
60 |
77 |
93 |
109 |
137 |
|||||||||||
Other business lines (b) |
9 |
8 |
8 |
3 |
2 |
|||||||||||
Total real estate construction |
69 |
85 |
101 |
112 |
139 |
|||||||||||
Commercial mortgage: |
||||||||||||||||
Commercial Real Estate business line (a) |
155 |
174 |
159 |
198 |
186 |
|||||||||||
Other business lines (b) |
220 |
275 |
268 |
275 |
269 |
|||||||||||
Total commercial mortgage |
375 |
449 |
427 |
473 |
455 |
|||||||||||
Lease financing |
4 |
4 |
5 |
5 |
6 |
|||||||||||
International |
— |
4 |
8 |
7 |
7 |
|||||||||||
Total nonaccrual business loans |
623 |
747 |
778 |
855 |
868 |
|||||||||||
Retail loans: |
||||||||||||||||
Residential mortgage |
76 |
69 |
71 |
65 |
60 |
|||||||||||
Consumer: |
||||||||||||||||
Home equity |
16 |
9 |
5 |
4 |
4 |
|||||||||||
Other consumer |
4 |
5 |
6 |
5 |
9 |
|||||||||||
Total consumer |
20 |
14 |
11 |
9 |
13 |
|||||||||||
Total nonaccrual retail loans |
96 |
83 |
82 |
74 |
73 |
|||||||||||
Total nonaccrual loans |
719 |
830 |
860 |
929 |
941 |
|||||||||||
Reduced-rate loans |
28 |
26 |
27 |
29 |
33 |
|||||||||||
Total nonperforming loans (c) |
747 |
856 |
887 |
958 |
974 |
|||||||||||
Foreclosed property |
67 |
67 |
94 |
87 |
70 |
|||||||||||
Total nonperforming assets (c) |
$ |
814 |
$ |
923 |
$ |
981 |
$ |
1,045 |
$ |
1,044 |
||||||
Nonperforming loans as a percentage of total loans |
1.70 |
% |
1.99 |
% |
2.08 |
% |
2.32 |
% |
2.49 |
% | ||||||
Nonperforming assets as a percentage of total loans and foreclosed property |
1.85 |
2.14 |
2.29 |
2.53 |
2.66 |
|||||||||||
Allowance for loan losses as a percentage of total nonperforming loans |
89 |
82 |
82 |
80 |
83 |
|||||||||||
Loans past due 90 days or more and still accruing |
$ |
43 |
$ |
50 |
$ |
58 |
$ |
81 |
$ |
64 |
||||||
ANALYSIS OF NONACCRUAL LOANS |
||||||||||||||||
Nonaccrual loans at beginning of period |
$ |
830 |
$ |
860 |
$ |
929 |
$ |
941 |
$ |
996 |
||||||
Loans transferred to nonaccrual (d) |
47 |
69 |
99 |
130 |
150 |
|||||||||||
Nonaccrual business loan gross charge-offs (e) |
(56) |
(55) |
(76) |
(76) |
(109) |
|||||||||||
Loans transferred to accrual status (d) |
(41) |
— |
— |
(15) |
— |
|||||||||||
Nonaccrual business loans sold (f) |
(16) |
(7) |
(19) |
(15) |
(16) |
|||||||||||
Payments/Other (g) |
(45) |
(37) |
(73) |
(36) |
(80) |
|||||||||||
Nonaccrual loans at end of period |
$ |
719 |
$ |
830 |
$ |
860 |
$ |
929 |
$ |
941 |
||||||
(a) Primarily loans to real estate investors and developers. |
||||||||||||||||
(b) Primarily loans secured by owner-occupied real estate. |
||||||||||||||||
(c) Excludes loans acquired with credit impairment. |
||||||||||||||||
(d) Based on an analysis of nonaccrual loans with book balances greater than $2 million. |
||||||||||||||||
(e) Analysis of gross loan charge-offs: |
||||||||||||||||
Nonaccrual business loans |
$ |
56 |
$ |
55 |
$ |
76 |
$ |
76 |
$ |
109 |
||||||
Performing watch list loans |
— |
— |
— |
1 |
— |
|||||||||||
Consumer and residential mortgage loans |
8 |
7 |
9 |
13 |
16 |
|||||||||||
Total gross loan charge-offs |
$ |
64 |
$ |
62 |
$ |
85 |
$ |
90 |
$ |
125 |
||||||
(f) Analysis of loans sold: |
||||||||||||||||
Nonaccrual business loans |
$ |
16 |
$ |
7 |
$ |
19 |
$ |
15 |
$ |
16 |
||||||
Performing watch list loans |
7 |
11 |
— |
16 |
6 |
|||||||||||
Total loans sold |
$ |
23 |
$ |
18 |
$ |
19 |
$ |
31 |
$ |
22 |
||||||
(g) Includes net changes related to nonaccrual loans with balances less than $2 million, payments on nonaccrual loans with book balances greater than $2 million and transfers of nonaccrual loans to foreclosed property. Excludes business loan gross charge-offs and business nonaccrual loans sold. |
ANALYSIS OF NET INTEREST INCOME (FTE) (unaudited) |
|||||||||||||||||
Comerica Incorporated and Subsidiaries |
|||||||||||||||||
Six Months Ended | |||||||||||||||||
June 30, 2012 |
June 30, 2011 | ||||||||||||||||
Average |
Average |
Average |
Average | ||||||||||||||
(dollar amounts in millions) |
Balance |
Interest |
Rate |
Balance |
Interest |
Rate | |||||||||||
Commercial loans |
$ |
25,359 |
$ |
446 |
3.54 |
% |
$ |
21,586 |
$ |
397 |
3.70 |
% | |||||
Real estate construction loans |
1,437 |
32 |
4.54 |
2,029 |
36 |
3.62 |
|||||||||||
Commercial mortgage loans |
10,093 |
231 |
4.59 |
9,713 |
191 |
3.96 |
|||||||||||
Lease financing |
883 |
15 |
3.35 |
972 |
17 |
3.56 |
|||||||||||
International loans |
1,235 |
23 |
3.71 |
1,237 |
24 |
3.83 |
|||||||||||
Residential mortgage loans |
1,503 |
35 |
4.65 |
1,562 |
42 |
5.37 |
|||||||||||
Consumer loans |
2,239 |
38 |
3.43 |
2,262 |
39 |
3.42 |
|||||||||||
Total loans (a) |
42,749 |
820 |
3.86 |
39,361 |
746 |
3.82 |
|||||||||||
Auction-rate securities available-for-sale |
324 |
1 |
0.71 |
527 |
2 |
0.80 |
|||||||||||
Other investment securities available-for-sale |
9,484 |
122 |
2.64 |
6,832 |
114 |
3.39 |
|||||||||||
Total investment securities available-for-sale |
9,808 |
123 |
2.57 |
7,359 |
116 |
3.19 |
|||||||||||
Interest-bearing deposits with banks (b) |
3,724 |
5 |
0.26 |
2,899 |
4 |
0.25 |
|||||||||||
Other short-term investments |
138 |
1 |
1.76 |
124 |
1 |
2.05 |
|||||||||||
Total earning assets |
56,419 |
949 |
3.39 |
49,743 |
867 |
3.51 |
|||||||||||
Cash and due from banks |
965 |
878 |
|||||||||||||||
Allowance for loan losses |
(723) |
(883) |
|||||||||||||||
Accrued income and other assets |
5,121 |
4,410 |
|||||||||||||||
Total assets |
$ |
61,782 |
$ |
54,148 |
|||||||||||||
Money market and interest-bearing checking deposits |
$ |
20,627 |
18 |
0.18 |
$ |
18,003 |
23 |
0.26 |
|||||||||
Savings deposits |
1,575 |
1 |
0.08 |
1,443 |
1 |
0.09 |
|||||||||||
Customer certificates of deposit |
6,042 |
17 |
0.55 |
5,559 |
20 |
0.73 |
|||||||||||
Foreign office and other time deposits |
369 |
1 |
0.61 |
413 |
1 |
0.50 |
|||||||||||
Total interest-bearing deposits |
28,613 |
37 |
0.26 |
25,418 |
45 |
0.36 |
|||||||||||
Short-term borrowings |
73 |
— |
0.11 |
103 |
— |
0.21 |
|||||||||||
Medium- and long-term debt |
4,897 |
33 |
1.37 |
5,974 |
34 |
1.15 |
|||||||||||
Total interest-bearing sources |
33,583 |
70 |
0.42 |
31,495 |
79 |
0.51 |
|||||||||||
Noninterest-bearing deposits |
19,882 |
15,623 |
|||||||||||||||
Accrued expenses and other liabilities |
1,346 |
1,126 |
|||||||||||||||
Total shareholders' equity |
6,971 |
5,904 |
|||||||||||||||
Total liabilities and shareholders' equity |
$ |
61,782 |
$ |
54,148 |
|||||||||||||
Net interest income/rate spread (FTE) |
$ |
879 |
2.97 |
$ |
788 |
3.00 |
|||||||||||
FTE adjustment |
$ |
1 |
$ |
2 |
|||||||||||||
Impact of net noninterest-bearing sources of funds |
0.17 |
0.19 |
|||||||||||||||
Net interest margin (as a percentage of average earning assets) (FTE) (a) (b) |
3.14 |
% |
3.19 |
% |
(a) |
Accretion of the purchase discount on the acquired loan portfolio of $43 million increased the net interest margin by 15 basis points in the six months ended June 30, 2012. |
(b) |
Excess liquidity, represented by average balances deposited with the Federal Reserve Bank, reduced the net interest margin by 20 basis points and 18 basis points in the six months ended June 30, 2012 and 2011, respectively. |
ANALYSIS OF NET INTEREST INCOME (FTE) (unaudited) |
||||||||||||||||||||||||||
Comerica Incorporated and Subsidiaries |
||||||||||||||||||||||||||
Three Months Ended | ||||||||||||||||||||||||||
June 30, 2012 |
March 31, 2012 |
June 30, 2011 | ||||||||||||||||||||||||
Average |
Average |
Average |
Average |
Average |
Average | |||||||||||||||||||||
(dollar amounts in millions) |
Balance |
Interest |
Rate |
Balance |
Interest |
Rate |
Balance |
Interest |
Rate | |||||||||||||||||
Commercial loans |
$ |
25,983 |
$ |
227 |
3.52 |
% |
$ |
24,736 |
$ |
219 |
3.56 |
% |
$ |
21,677 |
$ |
196 |
3.65 |
% | ||||||||
Real estate construction loans |
1,420 |
15 |
4.50 |
1,453 |
17 |
4.58 |
1,881 |
17 |
3.75 |
|||||||||||||||||
Commercial mortgage loans |
9,983 |
112 |
4.46 |
10,202 |
119 |
4.73 |
9,636 |
96 |
3.98 |
|||||||||||||||||
Lease financing |
869 |
7 |
3.28 |
897 |
8 |
3.41 |
958 |
8 |
3.50 |
|||||||||||||||||
International loans |
1,265 |
12 |
3.66 |
1,205 |
11 |
3.76 |
1,254 |
12 |
3.80 |
|||||||||||||||||
Residential mortgage loans |
1,487 |
17 |
4.53 |
1,519 |
18 |
4.77 |
1,525 |
21 |
5.50 |
|||||||||||||||||
Consumer loans |
2,221 |
18 |
3.37 |
2,257 |
20 |
3.49 |
2,243 |
20 |
3.42 |
|||||||||||||||||
Total loans (a) |
43,228 |
408 |
3.79 |
42,269 |
412 |
3.92 |
39,174 |
370 |
3.79 |
|||||||||||||||||
Auction-rate securities available-for-sale |
296 |
— |
0.82 |
352 |
1 |
0.63 |
500 |
1 |
0.71 |
|||||||||||||||||
Other investment securities available-for-sale |
9,432 |
59 |
2.55 |
9,537 |
63 |
2.73 |
6,907 |
58 |
3.40 |
|||||||||||||||||
Total investment securities available-for-sale |
9,728 |
59 |
2.49 |
9,889 |
64 |
2.65 |
7,407 |
59 |
3.20 |
|||||||||||||||||
Interest-bearing deposits with banks (b) |
3,556 |
3 |
0.26 |
3,893 |
2 |
0.26 |
3,435 |
3 |
0.25 |
|||||||||||||||||
Other short-term investments |
141 |
— |
1.55 |
135 |
1 |
1.97 |
120 |
— |
1.39 |
|||||||||||||||||
Total earning assets |
56,653 |
470 |
3.35 |
56,186 |
479 |
3.44 |
50,136 |
432 |
3.46 |
|||||||||||||||||
Cash and due from banks |
931 |
999 |
872 |
|||||||||||||||||||||||
Allowance for loan losses |
(710) |
(737) |
(859) |
|||||||||||||||||||||||
Accrued income and other assets |
5,076 |
5,165 |
4,368 |
|||||||||||||||||||||||
Total assets |
$ |
61,950 |
$ |
61,613 |
$ |
54,517 |
||||||||||||||||||||
Money market and interest-bearing checking deposits |
$ |
20,458 |
8 |
0.18 |
$ |
20,795 |
10 |
0.19 |
$ |
18,207 |
11 |
0.26 |
||||||||||||||
Savings deposits |
1,607 |
1 |
0.07 |
1,543 |
— |
0.08 |
1,465 |
1 |
0.09 |
|||||||||||||||||
Customer certificates of deposit |
6,107 |
9 |
0.53 |
5,978 |
8 |
0.57 |
5,609 |
10 |
0.70 |
|||||||||||||||||
Foreign office and other time deposits |
379 |
— |
0.64 |
358 |
1 |
0.57 |
413 |
1 |
0.52 |
|||||||||||||||||
Total interest-bearing deposits |
28,551 |
18 |
0.25 |
28,674 |
19 |
0.26 |
25,694 |
23 |
0.35 |
|||||||||||||||||
Short-term borrowings |
68 |
— |
0.12 |
78 |
— |
0.11 |
112 |
— |
0.14 |
|||||||||||||||||
Medium- and long-term debt |
4,854 |
17 |
1.40 |
4,940 |
16 |
1.34 |
5,821 |
17 |
1.20 |
|||||||||||||||||
Total interest-bearing sources |
33,473 |
35 |
0.42 |
33,692 |
35 |
0.42 |
31,627 |
40 |
0.51 |
|||||||||||||||||
Noninterest-bearing deposits |
20,128 |
19,637 |
15,786 |
|||||||||||||||||||||||
Accrued expenses and other liabilities |
1,347 |
1,345 |
1,132 |
|||||||||||||||||||||||
Total shareholders' equity |
7,002 |
6,939 |
5,972 |
|||||||||||||||||||||||
Total liabilities and shareholders' equity |
$ |
61,950 |
$ |
61,613 |
$ |
54,517 |
||||||||||||||||||||
Net interest income/rate spread (FTE) |
$ |
435 |
2.93 |
$ |
444 |
3.02 |
$ |
392 |
2.95 |
|||||||||||||||||
FTE adjustment |
$ |
— |
$ |
1 |
$ |
1 |
||||||||||||||||||||
Impact of net noninterest-bearing sources of funds |
0.17 |
0.17 |
0.19 |
|||||||||||||||||||||||
Net interest margin (as a percentage of average earning assets) (FTE) (a) (b) |
3.10 |
% |
3.19 |
% |
3.14 |
% |
(a) |
Accretion of the purchase discount on the acquired loan portfolio of $18 million and $25 million in the second and first quarters of 2012, respectively, increased the net interest margin by 13 basis points and 18 basis points in the second and first quarters of 2012, respectively. |
(b) |
Excess liquidity, represented by average balances deposited with the Federal Reserve Bank, reduced the net interest margin by 18 basis points and by 21 basis points in the second and first quarter of 2012, respectively, and by 21 basis points in the second quarter of 2011. |
CONSOLIDATED STATISTICAL DATA (unaudited) |
||||||||||||||||||||
Comerica Incorporated and Subsidiaries |
||||||||||||||||||||
June 30, |
March 31, |
December 31, |
September 30, |
June 30, | ||||||||||||||||
(in millions, except per share data) |
2012 |
2012 |
2011 |
2011 |
2011 | |||||||||||||||
Commercial loans: |
||||||||||||||||||||
Floor plan |
$ |
2,406 |
$ |
2,152 |
$ |
1,822 |
$ |
1,209 |
$ |
1,478 |
||||||||||
Other |
24,610 |
23,488 |
23,174 |
21,904 |
20,574 |
|||||||||||||||
Total commercial loans |
27,016 |
25,640 |
24,996 |
23,113 |
22,052 |
|||||||||||||||
Real estate construction loans: |
||||||||||||||||||||
Commercial Real Estate business line (a) |
991 |
1,055 |
1,103 |
1,226 |
1,343 |
|||||||||||||||
Other business lines (b) |
386 |
387 |
430 |
422 |
385 |
|||||||||||||||
Total real estate construction loans |
1,377 |
1,442 |
1,533 |
1,648 |
1,728 |
|||||||||||||||
Commercial mortgage loans: |
||||||||||||||||||||
Commercial Real Estate business line (a) |
2,315 |
2,501 |
2,507 |
2,602 |
1,930 |
|||||||||||||||
Other business lines (b) |
7,515 |
7,578 |
7,757 |
7,937 |
7,649 |
|||||||||||||||
Total commercial mortgage loans |
9,830 |
10,079 |
10,264 |
10,539 |
9,579 |
|||||||||||||||
Lease financing |
858 |
872 |
905 |
927 |
949 |
|||||||||||||||
International loans |
1,224 |
1,256 |
1,170 |
1,046 |
1,162 |
|||||||||||||||
Residential mortgage loans |
1,469 |
1,485 |
1,526 |
1,643 |
1,491 |
|||||||||||||||
Consumer loans: |
||||||||||||||||||||
Home equity |
1,584 |
1,612 |
1,655 |
1,683 |
1,622 |
|||||||||||||||
Other consumer |
634 |
626 |
630 |
626 |
610 |
|||||||||||||||
Total consumer loans |
2,218 |
2,238 |
2,285 |
2,309 |
2,232 |
|||||||||||||||
Total loans |
$ |
43,992 |
$ |
43,012 |
$ |
42,679 |
$ |
41,225 |
$ |
39,193 |
||||||||||
Goodwill |
$ |
635 |
$ |
635 |
$ |
635 |
$ |
635 |
$ |
150 |
||||||||||
Core deposit intangible |
25 |
27 |
29 |
32 |
— |
|||||||||||||||
Loan servicing rights |
3 |
3 |
3 |
3 |
4 |
|||||||||||||||
Tier 1 common capital ratio (c) (d) |
10.32 |
% |
10.27 |
% |
10.37 |
% |
10.57 |
% |
% |
10.53 |
% | |||||||||
Tier 1 risk-based capital ratio (d) |
10.32 |
10.27 |
10.41 |
10.65 |
10.53 |
|||||||||||||||
Total risk-based capital ratio (d) |
13.82 |
13.99 |
14.25 |
14.84 |
14.80 |
|||||||||||||||
Leverage ratio (d) |
10.92 |
10.94 |
10.92 |
11.41 |
11.40 |
|||||||||||||||
Tangible common equity ratio (c) |
10.27 |
10.21 |
10.27 |
10.43 |
10.90 |
|||||||||||||||
Common shareholders' equity per share of common stock |
$ |
36.18 |
$ |
35.44 |
$ |
34.80 |
$ |
34.94 |
$ |
34.15 |
||||||||||
Tangible common equity per share of common stock (c) |
32.76 |
32.06 |
31.42 |
31.57 |
33.28 |
|||||||||||||||
Market value per share for the quarter: |
||||||||||||||||||||
High |
32.88 |
34.00 |
27.37 |
35.79 |
39.00 |
|||||||||||||||
Low |
27.88 |
26.25 |
21.53 |
21.48 |
33.08 |
|||||||||||||||
Close |
30.71 |
32.36 |
25.80 |
22.97 |
34.57 |
|||||||||||||||
Quarterly ratios: |
||||||||||||||||||||
Return on average common shareholders' equity |
8.22 |
% |
7.50 |
% |
5.51 |
% |
5.91 |
% |
6.41 |
% | ||||||||||
Return on average assets |
0.93 |
0.84 |
0.63 |
0.67 |
0.70 |
|||||||||||||||
Efficiency ratio |
67.53 |
69.70 |
75.97 |
75.59 |
69.65 |
|||||||||||||||
Number of banking centers |
493 |
495 |
494 |
502 |
446 |
|||||||||||||||
Number of employees - full time equivalent |
9,014 |
9,195 |
9,397 |
9,701 |
8,915 |
|||||||||||||||
(a) |
Primarily loans to real estate investors and developers. | |||||||||||||||||||
(b) |
Primarily loans secured by owner-occupied real estate. | |||||||||||||||||||
(c) |
See Reconciliation of Non-GAAP Financial Measures. | |||||||||||||||||||
(d) |
June 30, 2012 ratios are estimated. |
PARENT COMPANY ONLY BALANCE SHEETS (unaudited) |
||||||||||||||||||||
Comerica Incorporated |
||||||||||||||||||||
June 30, |
December 31, |
June 30, | ||||||||||||||||||
(in millions, except share data) |
2012 |
2011 |
2011 | |||||||||||||||||
ASSETS |
||||||||||||||||||||
Cash and due from subsidiary bank |
$ |
2 |
$ |
7 |
14 |
|||||||||||||||
Short-term investments with subsidiary bank |
442 |
411 |
413 |
|||||||||||||||||
Other short-term investments |
86 |
90 |
90 |
|||||||||||||||||
Investment in subsidiaries, principally banks |
7,130 |
7,011 |
6,122 |
|||||||||||||||||
Premises and equipment |
4 |
4 |
3 |
|||||||||||||||||
Other assets |
146 |
177 |
162 |
|||||||||||||||||
Total assets |
$ |
7,810 |
$ |
7,700 |
$ |
6,804 |
||||||||||||||
LIABILITIES AND SHAREHOLDERS' EQUITY |
||||||||||||||||||||
Medium- and long-term debt |
$ |
633 |
$ |
666 |
$ |
635 |
||||||||||||||
Other liabilities |
149 |
166 |
131 |
|||||||||||||||||
Total liabilities |
782 |
832 |
766 |
|||||||||||||||||
Common stock - $5 par value: |
||||||||||||||||||||
Authorized - 325,000,000 shares |
||||||||||||||||||||
Issued - 228,164,824 shares at 6/30/12 and 12/31/11 and 203,878,110 shares at 6/30/11 |
1,141 |
1,141 |
1,019 |
|||||||||||||||||
Capital surplus |
2,144 |
2,170 |
1,472 |
|||||||||||||||||
Accumulated other comprehensive loss |
(301) |
(356) |
(308) |
|||||||||||||||||
Retained earnings |
5,744 |
5,546 |
5,395 |
|||||||||||||||||
Less cost of common stock in treasury - 33,889,392 shares at 6/30/12, 30,831,076 shares at 12/31/11, and 27,092,427 shares at 6/30/11 |
(1,700) |
(1,633) |
(1,540) |
|||||||||||||||||
Total shareholders' equity |
7,028 |
6,868 |
6,038 |
|||||||||||||||||
Total liabilities and shareholders' equity |
$ |
7,810 |
$ |
7,700 |
$ |
6,804 |
||||||||||||||
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (unaudited) |
||||||||||||||||||||
Comerica Incorporated and Subsidiaries |
||||||||||||||||||||
Accumulated |
||||||||||||||||||||
Common Stock |
Other |
Total | ||||||||||||||||||
Shares |
Capital |
Comprehensive |
Retained |
Treasury |
Shareholders' | |||||||||||||||
(in millions, except per share data) |
Outstanding |
Amount |
Surplus |
Loss |
Earnings |
Stock |
Equity | |||||||||||||
BALANCE AT DECEMBER 31, 2010 |
176.5 |
$ |
1,019 |
$ |
1,481 |
$ |
(389) |
$ |
5,247 |
$ |
(1,565) |
$ |
5,793 |
|||||||
Net income |
— |
— |
— |
— |
199 |
— |
199 |
|||||||||||||
Other comprehensive income, net of tax |
— |
— |
— |
81 |
— |
— |
81 |
|||||||||||||
Cash dividends declared on common stock ($0.20 per share) |
— |
— |
— |
— |
(35) |
— |
(35) |
|||||||||||||
Purchase of common stock |
(0.5) |
— |
— |
— |
— |
(21) |
(21) |
|||||||||||||
Net issuance of common stock under employee stock plans |
0.8 |
— |
(30) |
— |
(16) |
46 |
— |
|||||||||||||
Share-based compensation |
— |
— |
21 |
— |
— |
— |
21 |
|||||||||||||
BALANCE AT JUNE 30, 2011 |
176.8 |
$ |
1,019 |
$ |
1,472 |
$ |
(308) |
$ |
5,395 |
$ |
(1,540) |
$ |
6,038 |
|||||||
BALANCE AT DECEMBER 31, 2011 |
197.3 |
$ |
1,141 |
$ |
2,170 |
$ |
(356) |
$ |
5,546 |
$ |
(1,633) |
$ |
6,868 |
|||||||
Net income |
— |
— |
— |
— |
274 |
— |
274 |
|||||||||||||
Other comprehensive income, net of tax |
— |
— |
— |
55 |
— |
— |
55 |
|||||||||||||
Cash dividends declared on common stock ($0.25 per share) |
— |
— |
— |
— |
(49) |
— |
(49) |
|||||||||||||
Purchase of common stock |
(4.1) |
— |
— |
— |
— |
(125) |
(125) |
|||||||||||||
Net issuance of common stock under employee stock plans |
1.1 |
— |
(49) |
— |
(27) |
60 |
(16) |
|||||||||||||
Share-based compensation |
— |
— |
21 |
— |
— |
— |
21 |
|||||||||||||
Other |
— |
— |
2 |
— |
— |
(2) |
— |
|||||||||||||
BALANCE AT JUNE 30, 2012 |
194.3 |
$ |
1,141 |
$ |
2,144 |
$ |
(301) |
$ |
5,744 |
$ |
(1,700) |
$ |
7,028 |
BUSINESS SEGMENT FINANCIAL RESULTS (unaudited) |
||||||||||||||||||||||||
Comerica Incorporated and Subsidiaries |
||||||||||||||||||||||||
(dollar amounts in millions) |
Business |
Retail |
Wealth |
|||||||||||||||||||||
Three Months Ended June 30, 2012 |
Bank |
Bank |
Management |
Finance |
Other |
Total | ||||||||||||||||||
Earnings summary: |
||||||||||||||||||||||||
Net interest income (expense) (FTE) |
$ |
385 |
$ |
161 |
$ |
46 |
$ |
(166) |
$ |
9 |
$ |
435 |
||||||||||||
Provision for credit losses |
12 |
3 |
2 |
— |
2 |
19 |
||||||||||||||||||
Noninterest income |
83 |
47 |
66 |
17 |
(2) |
211 |
||||||||||||||||||
Noninterest expenses |
151 |
177 |
79 |
2 |
24 |
433 |
||||||||||||||||||
Provision (benefit) for income taxes (FTE) |
95 |
9 |
11 |
(56) |
(9) |
50 |
||||||||||||||||||
Net income (loss) |
$ |
210 |
$ |
19 |
$ |
20 |
$ |
(95) |
$ |
(10) |
$ |
144 |
||||||||||||
Net credit-related charge-offs |
$ |
26 |
$ |
9 |
$ |
10 |
— |
— |
$ |
45 |
||||||||||||||
Selected average balances: |
||||||||||||||||||||||||
Assets |
$ |
34,376 |
$ |
5,946 |
$ |
4,604 |
$ |
11,953 |
$ |
5,071 |
$ |
61,950 |
||||||||||||
Loans |
33,449 |
5,250 |
4,529 |
— |
— |
43,228 |
||||||||||||||||||
Deposits |
24,145 |
20,525 |
3,640 |
177 |
192 |
48,679 |
||||||||||||||||||
Statistical data: |
||||||||||||||||||||||||
Return on average assets (a) |
2.44 |
% |
0.35 |
% |
1.76 |
% |
N/M |
N/M |
0.93 |
% | ||||||||||||||
Efficiency ratio |
32.30 |
85.17 |
73.98 |
N/M |
N/M |
67.53 |
||||||||||||||||||
Business |
Retail |
Wealth |
||||||||||||||||||||||
Three Months Ended March 31, 2012 |
Bank |
Bank |
Management |
Finance |
Other |
Total | ||||||||||||||||||
Earnings summary: |
||||||||||||||||||||||||
Net interest income (expense) (FTE) |
$ |
379 |
$ |
167 |
$ |
47 |
$ |
(156) |
$ |
7 |
$ |
444 |
||||||||||||
Provision for credit losses |
2 |
4 |
15 |
— |
1 |
22 |
||||||||||||||||||
Noninterest income |
81 |
42 |
65 |
13 |
5 |
206 |
||||||||||||||||||
Noninterest expenses |
158 |
184 |
80 |
3 |
24 |
449 |
||||||||||||||||||
Provision (benefit) for income taxes (FTE) |
94 |
7 |
6 |
(54) |
(4) |
49 |
||||||||||||||||||
Net income (loss) |
$ |
206 |
$ |
14 |
$ |
11 |
$ |
(92) |
$ |
(9) |
$ |
130 |
||||||||||||
Net credit-related charge-offs |
$ |
28 |
$ |
12 |
$ |
5 |
— |
— |
$ |
45 |
||||||||||||||
Selected average balances: |
||||||||||||||||||||||||
Assets |
$ |
33,184 |
$ |
6,173 |
$ |
4,636 |
$ |
12,095 |
$ |
5,525 |
$ |
61,613 |
||||||||||||
Loans |
32,238 |
5,462 |
4,569 |
— |
— |
42,269 |
||||||||||||||||||
Deposits |
23,997 |
20,373 |
3,611 |
161 |
169 |
48,311 |
||||||||||||||||||
Statistical data: |
||||||||||||||||||||||||
Return on average assets (a) |
2.49 |
% |
0.27 |
% |
0.97 |
% |
N/M |
N/M |
0.84 |
% | ||||||||||||||
Efficiency ratio |
34.41 |
87.86 |
75.11 |
N/M |
N/M |
69.70 |
||||||||||||||||||
Business |
Retail |
Wealth |
||||||||||||||||||||||
Three Months Ended June 30, 2011 |
Bank |
Bank |
Management |
Finance |
Other |
Total | ||||||||||||||||||
Earnings summary: |
||||||||||||||||||||||||
Net interest income (expense) (FTE) |
$ |
342 |
$ |
141 |
$ |
48 |
$ |
(147) |
8 |
$ |
392 |
|||||||||||||
Provision for credit losses |
2 |
24 |
14 |
— |
5 |
45 |
||||||||||||||||||
Noninterest income |
79 |
46 |
63 |
13 |
1 |
202 |
||||||||||||||||||
Noninterest expenses |
162 |
162 |
76 |
3 |
8 |
411 |
||||||||||||||||||
Provision (benefit) for income taxes (FTE) |
81 |
4 |
9 |
(51) |
(1) |
42 |
||||||||||||||||||
Net income (loss) |
$ |
176 |
$ |
(3) |
$ |
12 |
$ |
(86) |
$ |
(3) |
$ |
96 |
||||||||||||
Net credit-related charge-offs |
$ |
54 |
$ |
22 |
$ |
14 |
— |
— |
$ |
90 |
||||||||||||||
Selected average balances: |
||||||||||||||||||||||||
Assets |
$ |
29,893 |
$ |
5,454 |
$ |
4,728 |
$ |
9,440 |
$ |
5,002 |
$ |
54,517 |
||||||||||||
Loans |
29,427 |
4,999 |
4,748 |
— |
— |
39,174 |
||||||||||||||||||
Deposits |
20,396 |
17,737 |
2,978 |
239 |
130 |
41,480 |
||||||||||||||||||
Statistical data: |
||||||||||||||||||||||||
Return on average assets (a) |
2.35 |
% |
(0.06) |
% |
1.03 |
% |
N/M |
N/M |
0.70 |
% | ||||||||||||||
Efficiency ratio |
38.27 |
86.63 |
71.58 |
N/M |
N/M |
69.65 |
||||||||||||||||||
(a) |
Return on average assets is calculated based on the greater of average assets or average liabilities and attributed equity. | |||
FTE - Fully Taxable Equivalent | ||||
N/M - Not Meaningful |
MARKET SEGMENT FINANCIAL RESULTS (unaudited) |
||||||||||||||||||||||||||||||||
Comerica Incorporated and Subsidiaries |
||||||||||||||||||||||||||||||||
(dollar amounts in millions) |
Other |
Finance |
||||||||||||||||||||||||||||||
Three Months Ended June 30, 2012 |
Midwest |
Western |
Texas |
Florida |
Markets |
International |
& Other |
Total | ||||||||||||||||||||||||
Earnings summary: |
||||||||||||||||||||||||||||||||
Net interest income (expense) (FTE) |
$ |
196 |
$ |
177 |
$ |
143 |
$ |
11 |
$ |
46 |
$ |
19 |
$ |
(157) |
$ |
435 |
||||||||||||||||
Provision for credit losses |
1 |
1 |
7 |
11 |
(4) |
1 |
2 |
19 |
||||||||||||||||||||||||
Noninterest income |
96 |
37 |
31 |
4 |
19 |
9 |
15 |
211 |
||||||||||||||||||||||||
Noninterest expenses |
177 |
104 |
88 |
11 |
18 |
9 |
26 |
433 |
||||||||||||||||||||||||
Provision (benefit) for income taxes (FTE) |
39 |
40 |
28 |
(2) |
4 |
6 |
(65) |
50 |
||||||||||||||||||||||||
Net income (loss) |
$ |
75 |
$ |
69 |
$ |
51 |
$ |
(5) |
$ |
47 |
$ |
12 |
$ |
(105) |
$ |
144 |
||||||||||||||||
Net credit-related charge-offs |
$ |
10 |
$ |
12 |
$ |
4 |
$ |
10 |
$ |
9 |
— |
— |
$ |
45 |
||||||||||||||||||
Selected average balances: |
||||||||||||||||||||||||||||||||
Assets |
$ |
14,028 |
$ |
13,170 |
$ |
10,270 |
$ |
1,407 |
$ |
4,183 |
$ |
1,868 |
$ |
17,024 |
$ |
61,950 |
||||||||||||||||
Loans |
13,766 |
12,920 |
9,506 |
1,429 |
3,837 |
1,770 |
— |
43,228 |
||||||||||||||||||||||||
Deposits |
19,227 |
14,371 |
10,185 |
446 |
2,728 |
1,353 |
369 |
48,679 |
||||||||||||||||||||||||
Statistical data: |
||||||||||||||||||||||||||||||||
Return on average assets (a) |
1.48 |
% |
1.78 |
% |
1.78 |
% |
(1.35) |
% |
4.53 |
% |
2.54 |
% |
N/M |
0.93 |
% | |||||||||||||||||
Efficiency ratio |
60.51 |
48.44 |
50.96 |
77.45 |
30.43 |
29.78 |
N/M |
67.53 |
||||||||||||||||||||||||
Other |
Finance |
|||||||||||||||||||||||||||||||
Three Months Ended March 31, 2012 |
Midwest |
Western |
Texas |
Florida |
Markets |
International |
& Other |
Total | ||||||||||||||||||||||||
Earnings summary: |
||||||||||||||||||||||||||||||||
Net interest income (expense) (FTE) |
$ |
198 |
$ |
171 |
$ |
151 |
$ |
10 |
$ |
45 |
$ |
18 |
$ |
(149) |
$ |
444 |
||||||||||||||||
Provision for credit losses |
11 |
(7) |
14 |
6 |
(2) |
(1) |
1 |
22 |
||||||||||||||||||||||||
Noninterest income |
98 |
33 |
31 |
4 |
14 |
8 |
18 |
206 |
||||||||||||||||||||||||
Noninterest expenses |
182 |
107 |
92 |
9 |
23 |
9 |
27 |
449 |
||||||||||||||||||||||||
Provision (benefit) for income taxes (FTE) |
35 |
39 |
27 |
— |
— |
6 |
(58) |
49 |
||||||||||||||||||||||||
Net income (loss) |
$ |
68 |
$ |
65 |
$ |
49 |
$ |
(1) |
$ |
38 |
$ |
12 |
$ |
(101) |
$ |
130 |
||||||||||||||||
Net credit-related charge-offs |
$ |
18 |
$ |
11 |
$ |
7 |
$ |
2 |
$ |
6 |
$ |
1 |
— |
$ |
45 |
|||||||||||||||||
Selected average balances: |
||||||||||||||||||||||||||||||||
Assets |
$ |
14,095 |
$ |
12,623 |
$ |
10,082 |
$ |
1,416 |
$ |
4,021 |
$ |
1,756 |
$ |
17,620 |
$ |
61,613 |
||||||||||||||||
Loans |
13,825 |
12,383 |
9,295 |
1,418 |
3,697 |
1,651 |
— |
42,269 |
||||||||||||||||||||||||
Deposits |
19,415 |
13,897 |
10,229 |
424 |
2,628 |
1,388 |
330 |
48,311 |
||||||||||||||||||||||||
Statistical data: |
||||||||||||||||||||||||||||||||
Return on average assets (a) |
1.33 |
% |
1.75 |
% |
1.72 |
% |
(0.21) |
% |
3.77 |
% |
2.73 |
% |
N/M |
0.84 |
% | |||||||||||||||||
Efficiency ratio |
61.40 |
52.52 |
50.75 |
68.89 |
44.68 |
32.95 |
N/M |
69.70 |
||||||||||||||||||||||||
Other |
Finance |
|||||||||||||||||||||||||||||||
Three Months Ended June 30, 2011 |
Midwest |
Western |
Texas |
Florida |
Markets |
International |
& Other |
Total | ||||||||||||||||||||||||
Earnings summary: |
||||||||||||||||||||||||||||||||
Net interest income (expense) (FTE) |
$ |
204 |
$ |
166 |
$ |
89 |
$ |
12 |
$ |
41 |
$ |
19 |
$ |
(139) |
$ |
392 |
||||||||||||||||
Provision for credit losses |
15 |
16 |
(2) |
12 |
4 |
(5) |
5 |
45 |
||||||||||||||||||||||||
Noninterest income |
100 |
37 |
25 |
4 |
13 |
9 |
14 |
202 |
||||||||||||||||||||||||
Noninterest expenses |
183 |
112 |
63 |
11 |
22 |
9 |
11 |
411 |
||||||||||||||||||||||||
Provision (benefit) for income taxes (FTE) |
44 |
25 |
20 |
(2) |
(2) |
9 |
(52) |
42 |
||||||||||||||||||||||||
Net income (loss) |
$ |
62 |
$ |
50 |
$ |
33 |
$ |
(5) |
$ |
30 |
$ |
15 |
$ |
(89) |
$ |
96 |
||||||||||||||||
Net credit-related charge-offs |
$ |
37 |
$ |
26 |
$ |
3 |
$ |
15 |
$ |
11 |
$ |
(2) |
— |
$ |
90 |
|||||||||||||||||
Selected average balances: |
||||||||||||||||||||||||||||||||
Assets |
$ |
14,262 |
$ |
12,329 |
$ |
7,082 |
$ |
1,534 |
$ |
3,106 |
$ |
1,762 |
$ |
14,442 |
$ |
54,517 |
||||||||||||||||
Loans |
14,050 |
12,121 |
6,872 |
1,565 |
2,829 |
1,737 |
— |
39,174 |
||||||||||||||||||||||||
Deposits |
18,318 |
12,458 |
6,176 |
396 |
2,451 |
1,312 |
369 |
41,480 |
||||||||||||||||||||||||
Statistical data: |
||||||||||||||||||||||||||||||||
Return on average assets (a) |
1.28 |
% |
1.48 |
% |
1.84 |
% |
(1.29) |
% |
3.87 |
% |
3.33 |
% |
N/M |
0.70 |
% | |||||||||||||||||
Efficiency ratio |
60.17 |
54.85 |
55.69 |
72.67 |
42.74 |
33.69 |
N/M |
69.65 |
||||||||||||||||||||||||
(a) |
Return on average assets is calculated based on the greater of average assets or average liabilities and attributed equity. |
FTE - Fully Taxable Equivalent | |
N/M - Not Meaningful |
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES (unaudited) |
|||||||||||||||||||
Comerica Incorporated and Subsidiaries |
|||||||||||||||||||
June 30, |
March 31, |
December 31, |
September 30, |
June 30, | |||||||||||||||
(dollar amounts in millions) |
2012 |
2012 |
2011 |
2011 |
2011 | ||||||||||||||
Tier 1 Common Capital Ratio: |
|||||||||||||||||||
Tier 1 capital (a) (b) |
$ |
6,676 |
$ |
6,647 |
$ |
6,582 |
$ |
6,560 |
$ |
6,193 |
|||||||||
Less: |
|||||||||||||||||||
Trust preferred securities |
— |
— |
25 |
49 |
— |
||||||||||||||
Tier 1 common capital (b) |
$ |
6,676 |
$ |
6,647 |
$ |
6,557 |
$ |
6,511 |
$ |
6,193 |
|||||||||
Risk-weighted assets (a) (b) |
$ |
64,691 |
$ |
64,742 |
$ |
63,244 |
$ |
61,593 |
$ |
58,795 |
|||||||||
Tier 1 risk-based capital ratio (b) |
10.32 |
% |
10.27 |
% |
10.41 |
% |
10.65 |
% |
10.53 |
% | |||||||||
Tier 1 common capital ratio (b) |
10.32 |
10.27 |
10.37 |
10.57 |
10.53 |
||||||||||||||
Tangible Common Equity Ratio: |
|||||||||||||||||||
Common shareholders' equity |
$ |
7,028 |
$ |
6,985 |
$ |
6,868 |
$ |
6,951 |
$ |
6,038 |
|||||||||
Less: |
|||||||||||||||||||
Goodwill |
635 |
635 |
635 |
635 |
150 |
||||||||||||||
Other intangible assets |
28 |
30 |
32 |
35 |
4 |
||||||||||||||
Tangible common equity |
$ |
6,365 |
$ |
6,320 |
$ |
6,201 |
$ |
6,281 |
$ |
5,884 |
|||||||||
Total assets |
$ |
62,650 |
$ |
62,593 |
$ |
61,008 |
$ |
60,888 |
$ |
54,141 |
|||||||||
Less: |
|||||||||||||||||||
Goodwill |
635 |
635 |
635 |
635 |
150 |
||||||||||||||
Other intangible assets |
28 |
30 |
32 |
35 |
4 |
||||||||||||||
Tangible assets |
$ |
61,987 |
$ |
61,928 |
$ |
60,341 |
$ |
60,218 |
$ |
53,987 |
|||||||||
Common equity ratio |
11.22 |
% |
11.16 |
% |
11.26 |
% |
11.42 |
% |
11.15 |
% | |||||||||
Tangible common equity ratio |
10.27 |
10.21 |
10.27 |
10.43 |
10.90 |
||||||||||||||
Tangible Common Equity per Share of Common Stock: |
|||||||||||||||||||
Common shareholders' equity |
$ |
7,028 |
$ |
6,985 |
$ |
6,868 |
$ |
6,951 |
$ |
6,038 |
|||||||||
Tangible common equity |
6,365 |
6,320 |
6,201 |
6,281 |
5,884 |
||||||||||||||
Shares of common stock outstanding (in millions) |
194 |
197 |
197 |
199 |
177 |
||||||||||||||
Common shareholders' equity per share of common stock |
$ |
36.18 |
$ |
35.44 |
$ |
34.80 |
$ |
34.94 |
$ |
34.15 |
|||||||||
Tangible common equity per share of common stock |
32.76 |
32.06 |
31.42 |
31.57 |
33.28 |
(a) |
Tier 1 capital and risk-weighted assets as defined by regulation. |
(b) |
June 30, 2012 Tier 1 capital and risk-weighted assets are estimated. |
The Tier 1 common capital ratio removes preferred stock and qualifying trust preferred securities from Tier 1 capital as defined by and calculated in conformity with bank regulations. The tangible common equity removes preferred stock and the effect of intangible assets from capital and the effect of intangible assets from total assets and tangible common equity per share of common stock removes the effect of intangible assets from common shareholders equity per share of common stock. Comerica believes these measurements are meaningful measures of capital adequacy used by investors, regulators, management and others to evaluate the adequacy of common equity and to compare against other companies in the industry.
SOURCE Comerica Incorporated