DALLAS, Jan. 17, 2014 /PRNewswire/ -- Comerica Incorporated (NYSE: CMA) today reported fourth quarter 2013 net income of $145 million, compared to $147 million for the third quarter 2013 and $130 million for the fourth quarter 2012. Earnings per diluted share were 77 cents for the fourth quarter 2013, compared to 78 cents for the third quarter 2013 and 68 cents for the fourth quarter 2012.
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Full-year 2013 net income was $569 million, an increase of $48 million, or 9 percent, compared to 2012. Earnings per diluted share were $3.00 for 2013, an increase of 33 cents, or 12 percent, compared to 2012.
(dollar amounts in millions, except per share data) |
4th Qtr '13 |
3rd Qtr '13 |
4th Qtr '12 | |||||||||
Net interest income (a) |
$ |
430 |
$ |
412 |
$ |
424 |
||||||
Provision for credit losses |
9 |
8 |
16 |
|||||||||
Noninterest income |
204 |
214 |
204 |
|||||||||
Noninterest expenses |
429 |
417 |
427 |
|||||||||
Provision for income taxes |
51 |
54 |
55 |
|||||||||
Net income |
145 |
147 |
130 |
|||||||||
Net income attributable to common shares |
143 |
145 |
128 |
|||||||||
Diluted income per common share |
0.77 |
0.78 |
0.68 |
|||||||||
Average diluted shares (in millions) |
186 |
187 |
188 |
|||||||||
Tier 1 common capital ratio (c) |
10.60 |
% |
(b) |
10.72 |
% |
10.14 |
% | |||||
Basel III Tier 1 common capital ratio (c) (d) |
10.3 |
10.4 |
9.8 |
|||||||||
Tangible common equity ratio (c) |
10.11 |
9.87 |
9.76 |
|||||||||
(a) |
Included accretion of the purchase discount on the acquired loan portfolio of $23 million, $8 million and $13 million in the fourth quarter 2013, third quarter 2013 and fourth quarter 2012, respectively. | |||||||||||
(b) |
December 31, 2013 ratio is estimated. | |||||||||||
(c) |
See Reconciliation of Non-GAAP Financial Measures. | |||||||||||
(d) |
Estimated ratios based on the standardized approach in the final rule and excluding most elements of accumulated other comprehensive income (AOCI). | |||||||||||
"Our relationship banking focus and our customers' strength in this uncertain national economy drove a 3 percent increase in average loans and a 4 percent increase in average deposits in 2013," said Ralph W. Babb Jr., chairman and chief executive officer. "2013 net income increased 9 percent, primarily as a result of tight expense control and strong credit quality, offsetting the headwinds of the continuing low rate environment.
"Average loans in the fourth quarter 2013 were stable, compared to the prior quarter, while growth trends throughout the quarter were positive, resulting in a broad-based, $1.3 billion increase in period-end loans. Earnings in the fourth quarter of 2013, compared to the prior quarter, reflected greater than expected purchase accounting accretion. This was offset by slightly lower fee income, following strong fee generation in the third quarter and the impact of slower economic activity, as well as additional costs related to regulatory compliance.
"Our solid capital position supports our growth and provides us the ability to return excess capital to our shareholders. We repurchased 7.4 million shares in 2013 under our share repurchase program; together with dividends we returned 73 percent of 2013 net income to shareholders. We recently filed our 2014-2015 capital plan with the Federal Reserve, which is expected to release its summary results in March 2014.
"In this low rate environment, our conservative, consistent approach to banking continues to serve us well, including our credit management, investment strategy, and capital position. We are pleased with our footprint, where there are many opportunities to leverage our relationship banking strategy by providing our customers with the products and services they desire."
Full-Year 2013 and Fourth Quarter Overview
Full-Year 2013 Compared to Full-Year 2012
Fourth Quarter 2013 Compared to Third Quarter 2013
Net Interest Income
(dollar amounts in millions) |
4th Qtr '13 |
3rd Qtr '13 |
4th Qtr '12 | ||||||||
Net interest income |
$ |
430 |
$ |
412 |
$ |
424 |
|||||
Net interest margin |
2.86 |
% |
2.79 |
% |
2.87 |
% | |||||
Selected average balances: |
|||||||||||
Total earning assets |
$ |
59,924 |
$ |
58,892 |
$ |
59,276 |
|||||
Total loans |
44,054 |
44,094 |
44,119 |
||||||||
Total investment securities |
9,365 |
9,380 |
10,250 |
||||||||
Federal Reserve Bank deposits (excess liquidity) |
6,260 |
5,156 |
4,638 |
||||||||
Total deposits |
52,769 |
51,865 |
51,282 |
||||||||
Total noninterest-bearing deposits |
23,532 |
22,379 |
22,758 |
||||||||
Noninterest Income
Noninterest income decreased $10 million to $204 million for the fourth quarter 2013, compared to $214 million for the third quarter 2013. Customer-driven fee income decreased $5 million and noncustomer-driven income decreased $5 million. The decrease in customer-driven fee income reflected a $2 million decrease in letter of credit fees and small decreases in other categories of noninterest income, partially offset by a $2 million increase in fiduciary income. The decrease in noncustomer-driven income was primarily due to a $6 million decrease in warrant income and a $3 million decrease in income on bank-owned life insurance, partially offset by a $6 million increase in deferred compensation plan asset returns, which was offset by an increase in deferred compensation expense as described below.
Noninterest Expenses
Noninterest expenses of $429 million in the fourth quarter 2013 increased $12 million compared to the third quarter 2013. Excluding a $6 million increase in deferred compensation expense, noninterest expenses increased $6 million, primarily reflecting the impact of a $5 million favorable outcome in litigation in the third quarter. The $6 million increase in deferred compensation expense (included in salaries expense) was offset by the increase in deferred compensation asset returns in noninterest income. Incentive compensation remained unchanged from the elevated third quarter level as financial performance relative to peers continued to improve.
Credit Quality
"The provision for credit losses was $9 million in the fourth quarter 2013, compared to $8 million in the third quarter 2013, reflecting continued strong credit quality and an increase in loan commitments and outstandings," said Babb. "Net credit-related charge-offs decreased slightly and remain at a very low level."
(dollar amounts in millions) |
4th Qtr '13 |
3rd Qtr '13 |
4th Qtr '12 | |||||||||
Net credit-related charge-offs |
$ |
13 |
$ |
19 |
$ |
37 |
||||||
Net credit-related charge-offs/Average total loans |
0.12 |
% |
0.18 |
% |
0.34 |
% | ||||||
Provision for credit losses |
$ |
9 |
$ |
8 |
$ |
16 |
||||||
Nonperforming loans (a) |
374 |
459 |
541 |
|||||||||
Nonperforming assets (NPAs) (a) |
383 |
478 |
595 |
|||||||||
NPAs/Total loans and foreclosed property |
0.84 |
% |
1.08 |
% |
1.29 |
% | ||||||
Loans past due 90 days or more and still accruing |
$ |
16 |
$ |
25 |
$ |
23 |
||||||
Allowance for loan losses |
598 |
604 |
629 |
|||||||||
Allowance for credit losses on lending-related commitments (b) |
36 |
34 |
32 |
|||||||||
Total allowance for credit losses |
634 |
638 |
661 |
|||||||||
Allowance for loan losses/Period-end total loans |
1.32 |
% |
1.37 |
% |
1.37 |
% | ||||||
Allowance for loan losses/Nonperforming loans |
160 |
131 |
116 |
|||||||||
(a) Excludes loans acquired with credit impairment. | ||||||||||||
(b) Included in "Accrued expenses and other liabilities" on the consolidated balance sheets. | ||||||||||||
Balance Sheet and Capital Management
Total assets and common shareholders' equity were $65.2 billion and $7.2 billion, respectively, at December 31, 2013, compared to $64.7 billion and $7.0 billion, respectively, at September 30, 2013. The $540 million increase in total assets primarily reflected an increase of $1.3 billion in loans, partially offset by decreases of $437 million in excess liquidity and $181 million in investment securities available-for-sale.
There were approximately 182 million common shares outstanding at December 31, 2013. Combined with the dividend of $0.17 per share, share repurchases under the share repurchase program and dividends returned 71 percent of fourth quarter 2013 net income to shareholders.
Comerica's tangible common equity ratio was 10.11 percent at December 31, 2013, an increase of 24 basis points from September 30, 2013. The estimated Tier 1 common capital ratio decreased 12 basis points, to 10.60 percent at December 31, 2013, from September 30, 2013. The estimated Tier 1 common ratio under fully phased-in Basel III capital rules and excluding most elements of AOCI was 10.3 percent percent at December 31, 2013.
Full-Year 2014 Outlook
Management expectations for full-year 2014 compared to full-year 2013, assuming a continuation of the slow growing economy and low rate environment, are as follows:
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 December 31, 2013 and are presented on a fully taxable equivalent (FTE) basis. The accompanying narrative addresses fourth quarter 2013 results compared to third quarter 2013.
The following table presents net income (loss) by business segment.
(dollar amounts in millions) |
4th Qtr '13 |
3rd Qtr '13 |
4th Qtr '12 | ||||||||||||||
Business Bank |
$ |
200 |
84 |
% |
$ |
209 |
91 |
% |
$ |
209 |
90 |
% | |||||
Retail Bank |
14 |
6 |
6 |
3 |
8 |
3 |
|||||||||||
Wealth Management |
23 |
10 |
15 |
6 |
16 |
7 |
|||||||||||
237 |
100 |
% |
230 |
100 |
% |
233 |
100 |
% | |||||||||
Finance |
(92) |
(87) |
(102) |
||||||||||||||
Other (a) |
— |
4 |
(1) |
||||||||||||||
Total |
$ |
145 |
$ |
147 |
$ |
130 |
(a) |
Includes items not directly associated with the three major business segments or the Finance Division. |
Business Bank | |||||||||||
(dollar amounts in millions) |
4th Qtr '13 |
3rd Qtr '13 |
4th Qtr '12 |
||||||||
Net interest income (FTE) |
$ |
387 |
$ |
368 |
$ |
387 |
|||||
Provision for credit losses |
24 |
(1) |
6 |
||||||||
Noninterest income |
80 |
89 |
79 |
||||||||
Noninterest expenses |
151 |
153 |
149 |
||||||||
Net income |
200 |
209 |
209 |
||||||||
Net credit-related charge-offs |
6 |
9 |
26 |
||||||||
Selected average balances: |
|||||||||||
Assets |
35,042 |
35,298 |
35,359 |
||||||||
Loans |
34,020 |
34,178 |
34,325 |
||||||||
Deposits |
26,873 |
26,284 |
26,051 |
||||||||
Retail Bank | ||||||||||||
(dollar amounts in millions) |
4th Qtr '13 |
3rd Qtr '13 |
4th Qtr '12 |
|||||||||
Net interest income (FTE) |
$ |
150 |
$ |
151 |
$ |
156 |
||||||
Provision for credit losses |
(8) |
10 |
7 |
|||||||||
Noninterest income |
43 |
45 |
43 |
|||||||||
Noninterest expenses |
180 |
177 |
181 |
|||||||||
Net income |
14 |
6 |
8 |
|||||||||
Net credit-related charge-offs |
4 |
7 |
6 |
|||||||||
Selected average balances: |
||||||||||||
Assets |
5,997 |
5,967 |
5,952 |
|||||||||
Loans |
5,323 |
5,285 |
5,255 |
|||||||||
Deposits |
21,438 |
21,257 |
20,910 |
|||||||||
Wealth Management | |||||||||||
(dollar amounts in millions) |
4th Qtr '13 |
3rd Qtr '13 |
4th Qtr '12 |
||||||||
Net interest income (FTE) |
$ |
47 |
$ |
45 |
$ |
47 |
|||||
Provision for credit losses |
(9) |
1 |
2 |
||||||||
Noninterest income |
61 |
61 |
65 |
||||||||
Noninterest expenses |
82 |
81 |
84 |
||||||||
Net income |
23 |
15 |
16 |
||||||||
Net credit-related charge-offs |
3 |
3 |
5 |
||||||||
Selected average balances: |
|||||||||||
Assets |
4,873 |
4,789 |
4,686 |
||||||||
Loans |
4,711 |
4,631 |
4,539 |
||||||||
Deposits |
3,933 |
3,782 |
3,798 |
||||||||
Geographic Market Segments
Comerica also provides market segment results for three primary geographic markets: Michigan, California and Texas. In addition to the three primary geographic markets, Other Markets is also reported as a market segment. Other Markets includes Florida, Arizona, the International Finance division and businesses that have a significant presence outside of the three primary geographic markets. The tables below present the geographic market results based on the methodologies in effect at December 31, 2013 and are presented on a fully taxable equivalent (FTE) basis.
The following table presents net income (loss) by market segment.
(dollar amounts in millions) |
4th Qtr '13 |
3rd Qtr '13 |
4th Qtr '12 | ||||||||||||||
Michigan |
$ |
63 |
26 |
% |
$ |
73 |
32 |
% |
$ |
74 |
32 |
% | |||||
California |
76 |
32 |
71 |
31 |
62 |
26 |
|||||||||||
Texas |
52 |
22 |
35 |
15 |
47 |
20 |
|||||||||||
Other Markets |
46 |
20 |
51 |
22 |
50 |
22 |
|||||||||||
237 |
100 |
% |
230 |
100 |
% |
233 |
100 |
% | |||||||||
Finance & Other (a) |
(92) |
(83) |
(103) |
||||||||||||||
Total |
$ |
145 |
$ |
147 |
$ |
130 |
(a) |
Includes items not directly associated with the geographic markets. |
Michigan Market | |||||||||||
(dollar amounts in millions) |
4th Qtr '13 |
3rd Qtr '13 |
4th Qtr '12 |
||||||||
Net interest income (FTE) |
$ |
187 |
$ |
186 |
$ |
192 |
|||||
Provision for credit losses |
7 |
(8) |
(8) |
||||||||
Noninterest income |
89 |
88 |
97 |
||||||||
Noninterest expenses |
170 |
167 |
180 |
||||||||
Net income |
63 |
73 |
74 |
||||||||
Net credit-related charge-offs |
(4) |
1 |
1 |
||||||||
Selected average balances: |
|||||||||||
Assets |
13,712 |
13,744 |
13,782 |
||||||||
Loans |
13,323 |
13,276 |
13,415 |
||||||||
Deposits |
20,501 |
20,465 |
20,019 |
California Market | |||||||||||
(dollar amounts in millions) |
4th Qtr '13 |
3rd Qtr '13 |
4th Qtr '12 |
||||||||
Net interest income (FTE) |
$ |
176 |
$ |
171 |
$ |
178 |
|||||
Provision for credit losses |
(8) |
(3) |
7 |
||||||||
Noninterest income |
37 |
42 |
35 |
||||||||
Noninterest expenses |
100 |
101 |
100 |
||||||||
Net income |
76 |
71 |
62 |
||||||||
Net credit-related charge-offs |
(2) |
8 |
12 |
||||||||
Selected average balances: |
|||||||||||
Assets |
14,710 |
14,245 |
13,549 |
||||||||
Loans |
14,431 |
14,002 |
13,275 |
||||||||
Deposits |
15,219 |
14,567 |
15,457 |
Texas Market | |||||||||||
(dollar amounts in millions) |
4th Qtr '13 |
3rd Qtr '13 |
4th Qtr '12 |
||||||||
Net interest income (FTE) |
$ |
147 |
$ |
129 |
$ |
136 |
|||||
Provision for credit losses |
5 |
17 |
4 |
||||||||
Noninterest income |
33 |
35 |
31 |
||||||||
Noninterest expenses |
93 |
92 |
90 |
||||||||
Net income |
52 |
35 |
47 |
||||||||
Net credit-related charge-offs |
13 |
4 |
5 |
||||||||
Selected average balances: |
|||||||||||
Assets |
10,458 |
10,642 |
10,554 |
||||||||
Loans |
9,766 |
9,942 |
9,818 |
||||||||
Deposits |
10,536 |
10,298 |
9,809 |
Conference Call and Webcast
Comerica will host a conference call to review fourth quarter 2013 financial results at 7 a.m. CT Friday, January 17, 2014. Interested parties may access the conference call by calling (800) 309-2262 or (706) 679-5261 (event ID No. 23046513). The call and supplemental financial information can also be accessed via Comerica's "Investor Relations" page at www.comerica.com. A replay of the Webcast can be accessed via Comerica's "Investor Relations" page at www.comerica.com.
Comerica Incorporated is a financial services company headquartered in Dallas, Texas, and strategically aligned by three major business segments: The Business Bank, The Retail Bank and Wealth Management. Comerica focuses on relationships and helping people and businesses be successful. In addition to Texas, Comerica Bank locations can be found in Arizona, California, Florida and Michigan, with select businesses operating in several other states, as well as in Canada and Mexico.
This press release contains both financial measures based on accounting principles generally accepted in the United States (GAAP) and non-GAAP based financial measures, which are used where management believes it to be helpful in understanding Comerica's results of operations or financial position. Where non-GAAP financial measures are used, the comparable GAAP financial measure, as well as a reconciliation to the comparable GAAP financial measure, can be found in this press release. These disclosures should not be viewed as a substitute for operating results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies.
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; any future acquisitions or divestitures; 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; 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 or determinations; the effectiveness of methods of reducing risk exposures; the effects of terrorist activities and other hostilities; the effects of catastrophic events including, but not limited to, hurricanes, tornadoes, earthquakes, fires, droughts and floods; changes in accounting standards and the critical nature of Comerica's accounting policies. Comerica cautions that the foregoing list of factors is not exclusive. For discussion of factors that may cause actual results to differ from expectations, please refer to our filings with the Securities and Exchange Commission. In particular, please refer to "Item 1A. Risk Factors" beginning on page 13 of Comerica's Annual Report on Form 10-K for the year ended December 31, 2012 and on page 68 of the Corporation's Quarterly Report on Form 10-Q for the quarter ended June 30, 2013. Forward-looking statements speak only as of the date they are made. Comerica does not undertake to update forward-looking statements to reflect facts, circumstances, assumptions or events that occur after the date the forward-looking statements are made. For any forward-looking statements made in this news release or in any documents, Comerica claims the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995.
CONSOLIDATED FINANCIAL HIGHLIGHTS (unaudited) | |||||||||||||||||
Comerica Incorporated and Subsidiaries | |||||||||||||||||
Three Months Ended |
Years Ended | ||||||||||||||||
December 31, |
September 30, |
December 31, |
December 31, | ||||||||||||||
(in millions, except per share data) |
2013 |
2013 |
2012 |
2013 |
2012 | ||||||||||||
PER COMMON SHARE AND COMMON STOCK DATA |
|||||||||||||||||
Diluted net income |
$ |
0.77 |
$ |
0.78 |
$ |
0.68 |
$ |
3.00 |
$ |
2.67 |
|||||||
Cash dividends declared |
0.17 |
0.17 |
0.15 |
0.68 |
0.55 |
||||||||||||
Common shareholders' equity (at period end) |
39.39 |
37.94 |
36.87 |
||||||||||||||
Tangible common equity (at period end) (a) |
35.81 |
34.38 |
33.38 |
||||||||||||||
Average diluted shares (in thousands) |
186,166 |
187,104 |
187,954 |
186,927 |
192,473 |
||||||||||||
KEY RATIOS |
|||||||||||||||||
Return on average common shareholders' equity |
8.26 |
% |
8.50 |
% |
7.36 |
% |
8.17 |
% |
7.43 |
% | |||||||
Return on average assets |
0.90 |
0.92 |
0.81 |
0.89 |
0.83 |
||||||||||||
Tier 1 common capital ratio (a) (b) |
10.60 |
10.72 |
10.14 |
||||||||||||||
Tier 1 risk-based capital ratio (b) |
10.60 |
10.72 |
10.14 |
||||||||||||||
Total risk-based capital ratio (b) |
13.05 |
13.42 |
13.15 |
||||||||||||||
Leverage ratio (b) |
10.82 |
10.88 |
10.57 |
||||||||||||||
Tangible common equity ratio (a) |
10.11 |
9.87 |
9.76 |
||||||||||||||
AVERAGE BALANCES |
|||||||||||||||||
Commercial loans |
$ |
27,683 |
$ |
27,759 |
$ |
27,462 |
$ |
27,971 |
$ |
26,224 |
|||||||
Real estate construction loans: |
|||||||||||||||||
Commercial Real Estate business line (c) |
1,363 |
1,263 |
1,033 |
1,241 |
1,031 |
||||||||||||
Other business lines (d) |
289 |
259 |
266 |
245 |
359 |
||||||||||||
Total real estate construction loans |
1,652 |
1,522 |
1,299 |
1,486 |
1,390 |
||||||||||||
Commercial mortgage loans: |
|||||||||||||||||
Commercial Real Estate business line (c) |
1,608 |
1,714 |
1,939 |
1,738 |
2,259 |
||||||||||||
Other business lines (d) |
7,106 |
7,229 |
7,580 |
7,322 |
7,583 |
||||||||||||
Total commercial mortgage loans |
8,714 |
8,943 |
9,519 |
9,060 |
9,842 |
||||||||||||
Lease financing |
838 |
839 |
839 |
847 |
864 |
||||||||||||
International loans |
1,303 |
1,252 |
1,314 |
1,275 |
1,272 |
||||||||||||
Residential mortgage loans |
1,679 |
1,642 |
1,525 |
1,620 |
1,505 |
||||||||||||
Consumer loans |
2,185 |
2,137 |
2,161 |
2,153 |
2,209 |
||||||||||||
Total loans |
44,054 |
44,094 |
44,119 |
44,412 |
43,306 |
||||||||||||
Earning assets |
59,924 |
58,892 |
59,276 |
59,091 |
57,483 |
||||||||||||
Total assets |
64,605 |
63,660 |
64,257 |
63,936 |
62,572 |
||||||||||||
Noninterest-bearing deposits |
23,532 |
22,379 |
22,758 |
22,379 |
21,004 |
||||||||||||
Interest-bearing deposits |
29,237 |
29,486 |
28,524 |
29,332 |
28,529 |
||||||||||||
Total deposits |
52,769 |
51,865 |
51,282 |
51,711 |
49,533 |
||||||||||||
Common shareholders' equity |
7,010 |
6,923 |
7,062 |
6,968 |
7,012 |
||||||||||||
NET INTEREST INCOME |
|||||||||||||||||
Net interest income (fully taxable equivalent basis) |
$ |
431 |
$ |
413 |
$ |
425 |
$ |
1,675 |
$ |
1,731 |
|||||||
Fully taxable equivalent adjustment |
1 |
1 |
1 |
3 |
3 |
||||||||||||
Net interest margin (fully taxable equivalent basis) |
2.86 |
% |
2.79 |
% |
2.87 |
% |
2.84 |
% |
3.03 |
% | |||||||
CREDIT QUALITY |
|||||||||||||||||
Nonaccrual loans |
$ |
350 |
$ |
437 |
$ |
519 |
|||||||||||
Reduced-rate loans |
24 |
22 |
22 |
||||||||||||||
Total nonperforming loans (e) |
374 |
459 |
541 |
||||||||||||||
Foreclosed property |
9 |
19 |
54 |
||||||||||||||
Total nonperforming assets (e) |
383 |
478 |
595 |
||||||||||||||
Loans past due 90 days or more and still accruing |
16 |
25 |
23 |
||||||||||||||
Gross loan charge-offs |
41 |
39 |
60 |
$ |
153 |
$ |
245 |
||||||||||
Loan recoveries |
28 |
20 |
23 |
80 |
75 |
||||||||||||
Net loan charge-offs |
13 |
19 |
37 |
73 |
170 |
||||||||||||
Allowance for loan losses |
598 |
604 |
629 |
||||||||||||||
Allowance for credit losses on lending-related commitments |
36 |
34 |
32 |
||||||||||||||
Total allowance for credit losses |
634 |
638 |
661 |
||||||||||||||
Allowance for loan losses as a percentage of total loans |
1.32 |
% |
1.37 |
% |
1.37 |
% |
|||||||||||
Net loan charge-offs as a percentage of average total loans (f) |
0.12 |
0.18 |
0.34 |
0.16 |
% |
0.39 |
% | ||||||||||
Nonperforming assets as a percentage of total loans and foreclosed property (e) |
0.84 |
1.08 |
1.29 |
||||||||||||||
Allowance for loan losses as a percentage of total nonperforming loans |
160 |
131 |
116 |
(a) |
See Reconciliation of Non-GAAP Financial Measures. |
||||||||||||||||
(b) |
December 31, 2013 ratios are estimated. | ||||||||||||||||
(c) |
Primarily loans to real estate developers. | ||||||||||||||||
(d) |
Primarily loans secured by owner-occupied real estate. | ||||||||||||||||
(e) |
Excludes loans acquired with credit-impairment. | ||||||||||||||||
(f) |
Lending-related commitment charge-offs were insignificant in all periods presented. |
CONSOLIDATED BALANCE SHEETS | |||||||||
Comerica Incorporated and Subsidiaries |
|||||||||
December 31, |
September 30, |
December 31, | |||||||
(in millions, except share data) |
2013 |
2013 |
2012 | ||||||
(unaudited) |
(unaudited) |
||||||||
ASSETS |
|||||||||
Cash and due from banks |
$ |
1,140 |
$ |
1,384 |
$ |
1,395 |
|||
Federal funds sold |
— |
— |
100 |
||||||
Interest-bearing deposits with banks |
5,311 |
5,704 |
3,039 |
||||||
Other short-term investments |
112 |
106 |
125 |
||||||
Investment securities available-for-sale |
9,307 |
9,488 |
10,297 |
||||||
Commercial loans |
28,815 |
27,897 |
29,513 |
||||||
Real estate construction loans |
1,762 |
1,552 |
1,240 |
||||||
Commercial mortgage loans |
8,787 |
8,785 |
9,472 |
||||||
Lease financing |
845 |
829 |
859 |
||||||
International loans |
1,327 |
1,286 |
1,293 |
||||||
Residential mortgage loans |
1,697 |
1,650 |
1,527 |
||||||
Consumer loans |
2,237 |
2,152 |
2,153 |
||||||
Total loans |
45,470 |
44,151 |
46,057 |
||||||
Less allowance for loan losses |
(598) |
(604) |
(629) |
||||||
Net loans |
44,872 |
43,547 |
45,428 |
||||||
Premises and equipment |
594 |
604 |
622 |
||||||
Accrued income and other assets |
3,874 |
3,837 |
4,063 |
||||||
Total assets |
$ |
65,210 |
$ |
64,670 |
$ |
65,069 |
|||
LIABILITIES AND SHAREHOLDERS' EQUITY |
|||||||||
Noninterest-bearing deposits |
$ |
23,875 |
$ |
23,896 |
$ |
23,279 |
|||
Money market and interest-bearing checking deposits |
22,332 |
21,697 |
21,273 |
||||||
Savings deposits |
1,673 |
1,645 |
1,606 |
||||||
Customer certificates of deposit |
5,063 |
5,180 |
5,531 |
||||||
Foreign office time deposits |
349 |
491 |
502 |
||||||
Total interest-bearing deposits |
29,417 |
29,013 |
28,912 |
||||||
Total deposits |
53,292 |
52,909 |
52,191 |
||||||
Short-term borrowings |
253 |
226 |
110 |
||||||
Accrued expenses and other liabilities |
941 |
1,001 |
1,106 |
||||||
Medium- and long-term debt |
3,543 |
3,565 |
4,720 |
||||||
Total liabilities |
58,029 |
57,701 |
58,127 |
||||||
Common stock - $5 par value: |
|||||||||
Authorized - 325,000,000 shares |
|||||||||
Issued - 228,164,824 shares |
1,141 |
1,141 |
1,141 |
||||||
Capital surplus |
2,179 |
2,171 |
2,162 |
||||||
Accumulated other comprehensive loss |
(391) |
(541) |
(413) |
||||||
Retained earnings |
6,349 |
6,239 |
5,931 |
||||||
Less cost of common stock in treasury - 45,860,786 shares at 12/31/13, 44,483,659 shares at 9/30/13 and 39,889,610 shares at 12/31/12 |
(2,097) |
(2,041) |
(1,879) |
||||||
Total shareholders' equity |
7,181 |
6,969 |
6,942 |
||||||
Total liabilities and shareholders' equity |
$ |
65,210 |
$ |
64,670 |
$ |
65,069 |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (unaudited) | |||||||||||||
Comerica Incorporated and Subsidiaries |
|||||||||||||
Three Months Ended |
Years Ended | ||||||||||||
December 31, |
December 31, | ||||||||||||
(in millions, except per share data) |
2013 |
2012 |
2013 |
2012 | |||||||||
INTEREST INCOME |
|||||||||||||
Interest and fees on loans |
$ |
397 |
$ |
398 |
$ |
1,556 |
$ |
1,617 |
|||||
Interest on investment securities |
55 |
55 |
214 |
234 |
|||||||||
Interest on short-term investments |
4 |
3 |
14 |
12 |
|||||||||
Total interest income |
456 |
456 |
1,784 |
1,863 |
|||||||||
INTEREST EXPENSE |
|||||||||||||
Interest on deposits |
12 |
16 |
55 |
70 |
|||||||||
Interest on medium- and long-term debt |
14 |
16 |
57 |
65 |
|||||||||
Total interest expense |
26 |
32 |
112 |
135 |
|||||||||
Net interest income |
430 |
424 |
1,672 |
1,728 |
|||||||||
Provision for credit losses |
9 |
16 |
46 |
79 |
|||||||||
Net interest income after provision for credit losses |
421 |
408 |
1,626 |
1,649 |
|||||||||
NONINTEREST INCOME |
|||||||||||||
Service charges on deposit accounts |
53 |
52 |
214 |
214 |
|||||||||
Fiduciary income |
43 |
42 |
171 |
158 |
|||||||||
Commercial lending fees |
28 |
25 |
99 |
96 |
|||||||||
Card fees |
19 |
17 |
74 |
65 |
|||||||||
Letter of credit fees |
15 |
17 |
64 |
71 |
|||||||||
Bank-owned life insurance |
9 |
9 |
40 |
39 |
|||||||||
Foreign exchange income |
9 |
9 |
36 |
38 |
|||||||||
Brokerage fees |
4 |
5 |
17 |
19 |
|||||||||
Net securities gains (losses) |
— |
1 |
(1) |
12 |
|||||||||
Other noninterest income |
24 |
27 |
112 |
106 |
|||||||||
Total noninterest income |
204 |
204 |
826 |
818 |
|||||||||
NONINTEREST EXPENSES |
|||||||||||||
Salaries |
203 |
196 |
769 |
778 |
|||||||||
Employee benefits |
61 |
59 |
246 |
240 |
|||||||||
Total salaries and employee benefits |
264 |
255 |
1,015 |
1,018 |
|||||||||
Net occupancy expense |
41 |
42 |
160 |
163 |
|||||||||
Equipment expense |
15 |
15 |
60 |
65 |
|||||||||
Outside processing fee expense |
30 |
28 |
119 |
107 |
|||||||||
Software expense |
24 |
23 |
90 |
90 |
|||||||||
FDIC insurance expense |
7 |
9 |
33 |
38 |
|||||||||
Advertising expense |
3 |
6 |
21 |
27 |
|||||||||
Other real estate expense |
(1) |
3 |
2 |
9 |
|||||||||
Merger and restructuring charges |
— |
2 |
— |
35 |
|||||||||
Other noninterest expenses |
46 |
44 |
178 |
205 |
|||||||||
Total noninterest expenses |
429 |
427 |
1,678 |
1,757 |
|||||||||
Income before income taxes |
196 |
185 |
774 |
710 |
|||||||||
Provision for income taxes |
51 |
55 |
205 |
189 |
|||||||||
NET INCOME |
145 |
130 |
569 |
521 |
|||||||||
Less income allocated to participating securities |
2 |
2 |
8 |
6 |
|||||||||
Net income attributable to common shares |
$ |
143 |
$ |
128 |
$ |
561 |
$ |
515 |
|||||
Earnings per common share: |
|||||||||||||
Basic |
$ |
0.79 |
$ |
0.68 |
$ |
3.07 |
$ |
2.68 |
|||||
Diluted |
0.77 |
0.68 |
3.00 |
2.67 |
|||||||||
Comprehensive income (loss) |
295 |
(30) |
591 |
464 |
|||||||||
Cash dividends declared on common stock |
31 |
28 |
126 |
106 |
|||||||||
Cash dividends declared per common share |
0.17 |
0.15 |
0.68 |
0.55 |
CONSOLIDATED QUARTERLY STATEMENTS OF COMPREHENSIVE INCOME (unaudited) | |||||||||||||||||||||||||||
Comerica Incorporated and Subsidiaries | |||||||||||||||||||||||||||
Fourth |
Third |
Second |
First |
Fourth |
Fourth Quarter 2013 Compared To: | ||||||||||||||||||||||
Quarter |
Quarter |
Quarter |
Quarter |
Quarter |
Third Quarter 2013 |
Fourth Quarter 2012 | |||||||||||||||||||||
(in millions, except per share data) |
2013 |
2013 |
2013 |
2013 |
2012 |
Amount |
Percent |
Amount |
Percent | ||||||||||||||||||
INTEREST INCOME |
|||||||||||||||||||||||||||
Interest and fees on loans |
$ |
397 |
$ |
381 |
$ |
388 |
$ |
390 |
$ |
398 |
$ |
16 |
4 |
% |
$ |
(1) |
— |
% | |||||||||
Interest on investment securities |
55 |
54 |
52 |
53 |
55 |
1 |
2 |
— |
— |
||||||||||||||||||
Interest on short-term investments |
4 |
4 |
3 |
3 |
3 |
— |
— |
1 |
27 |
||||||||||||||||||
Total interest income |
456 |
439 |
443 |
446 |
456 |
17 |
4 |
— |
— |
||||||||||||||||||
INTEREST EXPENSE |
|||||||||||||||||||||||||||
Interest on deposits |
12 |
13 |
15 |
15 |
16 |
(1) |
(8) |
(4) |
(24) |
||||||||||||||||||
Interest on medium- and long-term debt |
14 |
14 |
14 |
15 |
16 |
— |
— |
(2) |
(15) |
||||||||||||||||||
Total interest expense |
26 |
27 |
29 |
30 |
32 |
(1) |
(5) |
(6) |
(20) |
||||||||||||||||||
Net interest income |
430 |
412 |
414 |
416 |
424 |
18 |
4 |
6 |
1 |
||||||||||||||||||
Provision for credit losses |
9 |
8 |
13 |
16 |
16 |
1 |
22 |
(7) |
(42) |
||||||||||||||||||
Net interest income after provision for credit losses |
421 |
404 |
401 |
400 |
408 |
17 |
4 |
13 |
3 |
||||||||||||||||||
NONINTEREST INCOME |
|||||||||||||||||||||||||||
Service charges on deposit accounts |
53 |
53 |
53 |
55 |
52 |
— |
— |
1 |
1 |
||||||||||||||||||
Fiduciary income |
43 |
41 |
44 |
43 |
42 |
2 |
2 |
1 |
4 |
||||||||||||||||||
Commercial lending fees |
28 |
28 |
22 |
21 |
25 |
— |
— |
3 |
6 |
||||||||||||||||||
Card fees |
19 |
20 |
18 |
17 |
17 |
(1) |
(1) |
2 |
15 |
||||||||||||||||||
Letter of credit fees |
15 |
17 |
16 |
16 |
17 |
(2) |
(9) |
(2) |
(13) |
||||||||||||||||||
Bank-owned life insurance |
9 |
12 |
10 |
9 |
9 |
(3) |
(25) |
— |
— |
||||||||||||||||||
Foreign exchange income |
9 |
9 |
9 |
9 |
9 |
— |
— |
— |
— |
||||||||||||||||||
Brokerage fees |
4 |
4 |
4 |
5 |
5 |
— |
— |
(1) |
(14) |
||||||||||||||||||
Net securities gains (losses) |
— |
1 |
(2) |
— |
1 |
(1) |
(43) |
(1) |
(82) |
||||||||||||||||||
Other noninterest income |
24 |
29 |
34 |
25 |
27 |
(5) |
(16) |
(3) |
(6) |
||||||||||||||||||
Total noninterest income |
204 |
214 |
208 |
200 |
204 |
(10) |
(5) |
— |
— |
||||||||||||||||||
NONINTEREST EXPENSES |
|||||||||||||||||||||||||||
Salaries |
203 |
196 |
182 |
188 |
196 |
7 |
4 |
7 |
4 |
||||||||||||||||||
Employee benefits |
61 |
59 |
63 |
63 |
59 |
2 |
3 |
2 |
4 |
||||||||||||||||||
Total salaries and employee benefits |
264 |
255 |
245 |
251 |
255 |
9 |
3 |
9 |
4 |
||||||||||||||||||
Net occupancy expense |
41 |
41 |
39 |
39 |
42 |
— |
— |
(1) |
(2) |
||||||||||||||||||
Equipment expense |
15 |
15 |
15 |
15 |
15 |
— |
— |
— |
— |
||||||||||||||||||
Outside processing fee expense |
30 |
31 |
30 |
28 |
28 |
(1) |
(7) |
2 |
5 |
||||||||||||||||||
Software expense |
24 |
22 |
22 |
22 |
23 |
2 |
11 |
1 |
6 |
||||||||||||||||||
FDIC insurance expense |
7 |
9 |
8 |
9 |
9 |
(2) |
(19) |
(2) |
(22) |
||||||||||||||||||
Advertising expense |
3 |
6 |
6 |
6 |
6 |
(3) |
(49) |
(3) |
(48) |
||||||||||||||||||
Other real estate expense |
(1) |
1 |
1 |
1 |
3 |
(2) |
N/M |
(4) |
N/M |
||||||||||||||||||
Merger and restructuring charges |
— |
— |
— |
— |
2 |
— |
— |
(2) |
N/M |
||||||||||||||||||
Other noninterest expenses |
46 |
37 |
50 |
45 |
44 |
9 |
23 |
2 |
1 |
||||||||||||||||||
Total noninterest expenses |
429 |
417 |
416 |
416 |
427 |
12 |
3 |
2 |
— |
||||||||||||||||||
Income before income taxes |
196 |
201 |
193 |
184 |
185 |
(5) |
(2) |
11 |
6 |
||||||||||||||||||
Provision for income taxes |
51 |
54 |
50 |
50 |
55 |
(3) |
(5) |
(4) |
(7) |
||||||||||||||||||
NET INCOME |
145 |
147 |
143 |
134 |
130 |
(2) |
(2) |
15 |
11 |
||||||||||||||||||
Less income allocated to participating securities |
2 |
2 |
2 |
2 |
2 |
— |
— |
— |
— |
||||||||||||||||||
Net income attributable to common shares |
$ |
143 |
$ |
145 |
$ |
141 |
$ |
132 |
$ |
128 |
$ |
(2) |
(2) |
% |
$ |
15 |
11 |
% | |||||||||
Earnings per common share: |
|||||||||||||||||||||||||||
Basic |
$ |
0.79 |
$ |
0.80 |
$ |
0.77 |
$ |
0.71 |
$ |
0.68 |
$ |
(0.01) |
(1) |
% |
$ |
0.11 |
16 |
% | |||||||||
Diluted |
0.77 |
0.78 |
0.76 |
0.70 |
0.68 |
(0.01) |
(1) |
0.09 |
13 |
||||||||||||||||||
Comprehensive income (loss) |
295 |
144 |
15 |
137 |
(30) |
151 |
N/M |
325 |
N/M |
||||||||||||||||||
Cash dividends declared on common stock |
31 |
31 |
32 |
32 |
28 |
— |
— |
3 |
10 |
||||||||||||||||||
Cash dividends declared per common share |
0.17 |
0.17 |
0.17 |
0.17 |
0.15 |
— |
— |
0.02 |
13 |
||||||||||||||||||
N/M - Not Meaningful |
ANALYSIS OF THE ALLOWANCE FOR LOAN LOSSES (unaudited) |
|||||||||||||||||
Comerica Incorporated and Subsidiaries | |||||||||||||||||
2013 |
2012 | ||||||||||||||||
(in millions) |
4th Qtr |
3rd Qtr |
2nd Qtr |
1st Qtr |
4th Qtr | ||||||||||||
Balance at beginning of period |
$ |
604 |
$ |
613 |
$ |
617 |
$ |
629 |
$ |
647 |
|||||||
Loan charge-offs: |
|||||||||||||||||
Commercial |
31 |
20 |
19 |
21 |
42 |
||||||||||||
Real estate construction: |
|||||||||||||||||
Commercial Real Estate business line (a) |
— |
1 |
2 |
— |
1 |
||||||||||||
Other business lines (b) |
— |
— |
— |
— |
— |
||||||||||||
Total real estate construction |
— |
1 |
2 |
— |
1 |
||||||||||||
Commercial mortgage: |
|||||||||||||||||
Commercial Real Estate business line (a) |
1 |
6 |
2 |
1 |
5 |
||||||||||||
Other business lines (b) |
4 |
3 |
7 |
12 |
6 |
||||||||||||
Total commercial mortgage |
5 |
9 |
9 |
13 |
11 |
||||||||||||
International |
— |
— |
— |
— |
— |
||||||||||||
Residential mortgage |
1 |
1 |
1 |
1 |
2 |
||||||||||||
Consumer |
4 |
8 |
4 |
3 |
4 |
||||||||||||
Total loan charge-offs |
41 |
39 |
35 |
38 |
60 |
||||||||||||
Recoveries on loans previously charged-off: |
|||||||||||||||||
Commercial |
17 |
8 |
11 |
6 |
13 |
||||||||||||
Real estate construction |
3 |
2 |
1 |
1 |
1 |
||||||||||||
Commercial mortgage |
5 |
7 |
3 |
5 |
6 |
||||||||||||
Lease financing |
— |
1 |
— |
— |
— |
||||||||||||
International |
— |
— |
— |
— |
1 |
||||||||||||
Residential mortgage |
1 |
1 |
1 |
1 |
1 |
||||||||||||
Consumer |
2 |
1 |
2 |
1 |
1 |
||||||||||||
Total recoveries |
28 |
20 |
18 |
14 |
23 |
||||||||||||
Net loan charge-offs |
13 |
19 |
17 |
24 |
37 |
||||||||||||
Provision for loan losses |
7 |
10 |
13 |
12 |
19 |
||||||||||||
Balance at end of period |
$ |
598 |
$ |
604 |
$ |
613 |
$ |
617 |
$ |
629 |
|||||||
Allowance for loan losses as a percentage of total loans |
1.32 |
% |
1.37 |
% |
1.35 |
% |
1.37 |
% |
1.37 |
% | |||||||
Net loan charge-offs as a percentage of average total loans |
0.12 |
0.18 |
0.15 |
0.21 |
0.34 |
(a) |
Primarily charge-offs of loans to real estate developers. |
||||||||||||||||
(b) |
Primarily charge-offs of loans secured by owner-occupied real estate. |
ANALYSIS OF THE ALLOWANCE FOR CREDIT LOSSES ON LENDING-RELATED COMMITMENTS (unaudited) | ||||||||||||||||
Comerica Incorporated and Subsidiaries | ||||||||||||||||
2013 |
2012 | |||||||||||||||
(in millions) |
4th Qtr |
3rd Qtr |
2nd Qtr |
1st Qtr |
4th Qtr | |||||||||||
Balance at beginning of period |
$ |
34 |
$ |
36 |
$ |
36 |
$ |
32 |
$ |
35 |
||||||
Add: Provision for credit losses on lending-related commitments |
2 |
(2) |
— |
4 |
(3) |
|||||||||||
Balance at end of period |
$ |
36 |
$ |
34 |
$ |
36 |
$ |
36 |
$ |
32 |
||||||
Unfunded lending-related commitments sold |
$ |
1 |
$ |
2 |
$ |
1 |
$ |
2 |
$ |
— |
NONPERFORMING ASSETS (unaudited) | ||||||||||||||||
Comerica Incorporated and Subsidiaries | ||||||||||||||||
2013 |
2012 | |||||||||||||||
(in millions) |
4th Qtr |
3rd Qtr |
2nd Qtr |
1st Qtr |
4th Qtr | |||||||||||
SUMMARY OF NONPERFORMING ASSETS AND PAST DUE LOANS |
||||||||||||||||
Nonaccrual loans: |
||||||||||||||||
Business loans: |
||||||||||||||||
Commercial |
$ |
81 |
$ |
107 |
$ |
102 |
$ |
102 |
$ |
103 |
||||||
Real estate construction: |
||||||||||||||||
Commercial Real Estate business line (a) |
20 |
24 |
26 |
30 |
30 |
|||||||||||
Other business lines (b) |
1 |
1 |
2 |
3 |
3 |
|||||||||||
Total real estate construction |
21 |
25 |
28 |
33 |
33 |
|||||||||||
Commercial mortgage: |
||||||||||||||||
Commercial Real Estate business line (a) |
51 |
67 |
69 |
86 |
94 |
|||||||||||
Other business lines (b) |
105 |
139 |
157 |
178 |
181 |
|||||||||||
Total commercial mortgage |
156 |
206 |
226 |
264 |
275 |
|||||||||||
Lease financing |
— |
— |
— |
— |
3 |
|||||||||||
International |
4 |
— |
— |
— |
— |
|||||||||||
Total nonaccrual business loans |
262 |
338 |
356 |
399 |
414 |
|||||||||||
Retail loans: |
||||||||||||||||
Residential mortgage |
53 |
63 |
62 |
65 |
70 |
|||||||||||
Consumer: |
||||||||||||||||
Home equity |
33 |
34 |
28 |
28 |
31 |
|||||||||||
Other consumer |
2 |
2 |
3 |
2 |
4 |
|||||||||||
Total consumer |
35 |
36 |
31 |
30 |
35 |
|||||||||||
Total nonaccrual retail loans |
88 |
99 |
93 |
95 |
105 |
|||||||||||
Total nonaccrual loans |
350 |
437 |
449 |
494 |
519 |
|||||||||||
Reduced-rate loans |
24 |
22 |
22 |
21 |
22 |
|||||||||||
Total nonperforming loans (c) |
374 |
459 |
471 |
515 |
541 |
|||||||||||
Foreclosed property |
9 |
19 |
29 |
40 |
54 |
|||||||||||
Total nonperforming assets (c) |
$ |
383 |
$ |
478 |
$ |
500 |
$ |
555 |
$ |
595 |
||||||
Nonperforming loans as a percentage of total loans |
0.82 |
% |
1.04 |
% |
1.04 |
% |
1.14 |
% |
1.17 |
% | ||||||
Nonperforming assets as a percentage of total loans and foreclosed property |
0.84 |
1.08 |
1.10 |
1.23 |
1.29 |
|||||||||||
Allowance for loan losses as a percentage of total nonperforming loans |
160 |
131 |
130 |
120 |
116 |
|||||||||||
Loans past due 90 days or more and still accruing |
$ |
16 |
$ |
25 |
$ |
20 |
$ |
25 |
$ |
23 |
||||||
ANALYSIS OF NONACCRUAL LOANS |
||||||||||||||||
Nonaccrual loans at beginning of period |
$ |
437 |
$ |
449 |
$ |
494 |
$ |
519 |
$ |
665 |
||||||
Loans transferred to nonaccrual (d) |
23 |
50 |
37 |
34 |
36 |
|||||||||||
Nonaccrual business loan gross charge-offs (e) |
(33) |
(25) |
(25) |
(34) |
(54) |
|||||||||||
Nonaccrual business loans sold (f) |
(14) |
(17) |
(9) |
(7) |
(48) |
|||||||||||
Payments/Other (g) |
(63) |
(20) |
(48) |
(18) |
(80) |
|||||||||||
Nonaccrual loans at end of period |
$ |
350 |
$ |
437 |
$ |
449 |
$ |
494 |
$ |
519 |
||||||
(a) Primarily loans to real estate 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 |
$ |
33 |
$ |
25 |
$ |
25 |
$ |
34 |
$ |
54 |
||||||
Performing criticized loans |
3 |
5 |
5 |
— |
— |
|||||||||||
Consumer and residential mortgage loans |
5 |
9 |
5 |
4 |
6 |
|||||||||||
Total gross loan charge-offs |
$ |
41 |
$ |
39 |
$ |
35 |
$ |
38 |
$ |
60 |
||||||
(f) Analysis of loans sold: |
||||||||||||||||
Nonaccrual business loans |
$ |
14 |
$ |
17 |
$ |
9 |
$ |
7 |
$ |
48 |
||||||
Performing criticized loans |
22 |
31 |
40 |
12 |
24 |
|||||||||||
Total loans sold |
$ |
36 |
$ |
48 |
$ |
49 |
$ |
19 |
$ |
72 |
||||||
(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 | |||||||||||||||||
Years Ended | |||||||||||||||||
December 31, 2013 |
December 31, 2012 | ||||||||||||||||
Average |
Average |
Average |
Average | ||||||||||||||
(dollar amounts in millions) |
Balance |
Interest |
Rate |
Balance |
Interest |
Rate | |||||||||||
Commercial loans |
$ |
27,971 |
$ |
917 |
3.28 |
% |
$ |
26,224 |
$ |
903 |
3.44 |
% | |||||
Real estate construction loans |
1,486 |
57 |
3.85 |
1,390 |
62 |
4.44 |
|||||||||||
Commercial mortgage loans |
9,060 |
372 |
4.11 |
9,842 |
437 |
4.44 |
|||||||||||
Lease financing |
847 |
27 |
3.23 |
864 |
26 |
3.01 |
|||||||||||
International loans |
1,275 |
48 |
3.74 |
1,272 |
47 |
3.73 |
|||||||||||
Residential mortgage loans |
1,620 |
66 |
4.09 |
1,505 |
68 |
4.55 |
|||||||||||
Consumer loans |
2,153 |
71 |
3.30 |
2,209 |
76 |
3.42 |
|||||||||||
Total loans (a) |
44,412 |
1,558 |
3.51 |
43,306 |
1,619 |
3.74 |
|||||||||||
Mortgage-backed securities available-for-sale |
9,246 |
213 |
2.33 |
9,446 |
231 |
2.52 |
|||||||||||
Other investment securities available-for-sale |
391 |
2 |
0.48 |
469 |
4 |
0.77 |
|||||||||||
Total investment securities available-for-sale |
9,637 |
215 |
2.25 |
9,915 |
235 |
2.43 |
|||||||||||
Interest-bearing deposits with banks (b) |
4,930 |
13 |
0.26 |
4,128 |
10 |
0.26 |
|||||||||||
Other short-term investments |
112 |
1 |
1.22 |
134 |
2 |
1.65 |
|||||||||||
Total earning assets |
59,091 |
1,787 |
3.03 |
57,483 |
1,866 |
3.27 |
|||||||||||
Cash and due from banks |
987 |
983 |
|||||||||||||||
Allowance for loan losses |
(622) |
(693) |
|||||||||||||||
Accrued income and other assets |
4,480 |
4,799 |
|||||||||||||||
Total assets |
$ |
63,936 |
$ |
62,572 |
|||||||||||||
Money market and interest-bearing checking deposits |
$ |
21,704 |
28 |
0.13 |
$ |
20,622 |
35 |
0.17 |
|||||||||
Savings deposits |
1,657 |
1 |
0.03 |
1,593 |
1 |
0.06 |
|||||||||||
Customer certificates of deposit |
5,471 |
23 |
0.42 |
5,902 |
31 |
0.53 |
|||||||||||
Foreign office time deposits |
500 |
3 |
0.52 |
412 |
3 |
0.63 |
|||||||||||
Total interest-bearing deposits |
29,332 |
55 |
0.19 |
28,529 |
70 |
0.25 |
|||||||||||
Short-term borrowings |
211 |
— |
0.07 |
76 |
— |
0.12 |
|||||||||||
Medium- and long-term debt |
3,972 |
57 |
1.45 |
4,818 |
65 |
1.36 |
|||||||||||
Total interest-bearing sources |
33,515 |
112 |
0.33 |
33,423 |
135 |
0.41 |
|||||||||||
Noninterest-bearing deposits |
22,379 |
21,004 |
|||||||||||||||
Accrued expenses and other liabilities |
1,074 |
1,133 |
|||||||||||||||
Total shareholders' equity |
6,968 |
7,012 |
|||||||||||||||
Total liabilities and shareholders' equity |
$ |
63,936 |
$ |
62,572 |
|||||||||||||
Net interest income/rate spread (FTE) |
$ |
1,675 |
2.70 |
$ |
1,731 |
2.86 |
|||||||||||
FTE adjustment |
$ |
3 |
$ |
3 |
|||||||||||||
Impact of net noninterest-bearing sources of funds |
0.14 |
0.17 |
|||||||||||||||
Net interest margin (as a percentage of average earning assets) (FTE) (a) (b) |
2.84 |
% |
3.03 |
% |
(a) |
Accretion of the purchase discount on the acquired loan portfolio of $49 million and $71 million in 2013 and 2012, respectively, increased the net interest margin by 8 basis points and 12 basis points in each respective period. |
(b) |
Excess liquidity, represented by average balances deposited with the Federal Reserve Bank, reduced the net interest margin by 23 basis points and 21 basis points in 2013 and 2012, respectively. |
ANALYSIS OF NET INTEREST INCOME (FTE) (unaudited) | ||||||||||||||||||||||||||
Comerica Incorporated and Subsidiaries | ||||||||||||||||||||||||||
Three Months Ended | ||||||||||||||||||||||||||
December 31, 2013 |
September 30, 2013 |
December 31, 2012 | ||||||||||||||||||||||||
Average |
Average |
Average |
Average |
Average |
Average | |||||||||||||||||||||
(dollar amounts in millions) |
Balance |
Interest |
Rate |
Balance |
Interest |
Rate |
Balance |
Interest |
Rate | |||||||||||||||||
Commercial loans |
$ |
27,683 |
$ |
228 |
3.26 |
% |
$ |
27,759 |
$ |
226 |
3.25 |
% |
$ |
27,462 |
$ |
230 |
3.33 |
% | ||||||||
Real estate construction loans |
1,652 |
15 |
3.50 |
1,522 |
15 |
3.78 |
1,299 |
15 |
4.32 |
|||||||||||||||||
Commercial mortgage loans |
8,714 |
101 |
4.62 |
8,943 |
88 |
3.90 |
9,519 |
100 |
4.22 |
|||||||||||||||||
Lease financing |
838 |
7 |
3.27 |
839 |
7 |
3.21 |
839 |
7 |
3.27 |
|||||||||||||||||
International loans |
1,303 |
12 |
3.78 |
1,252 |
12 |
3.76 |
1,314 |
12 |
3.73 |
|||||||||||||||||
Residential mortgage loans |
1,679 |
17 |
3.97 |
1,642 |
17 |
3.98 |
1,525 |
16 |
4.24 |
|||||||||||||||||
Consumer loans |
2,185 |
18 |
3.24 |
2,137 |
17 |
3.27 |
2,161 |
19 |
3.38 |
|||||||||||||||||
Total loans (a) |
44,054 |
398 |
3.58 |
44,094 |
382 |
3.44 |
44,119 |
399 |
3.60 |
|||||||||||||||||
Mortgage-backed securities available-for-sale |
8,969 |
55 |
2.46 |
8,989 |
54 |
2.41 |
9,831 |
55 |
2.29 |
|||||||||||||||||
Other investment securities available-for-sale |
396 |
— |
0.45 |
391 |
— |
0.43 |
419 |
— |
0.76 |
|||||||||||||||||
Total investment securities available-for-sale |
9,365 |
55 |
2.37 |
9,380 |
54 |
2.32 |
10,250 |
55 |
2.22 |
|||||||||||||||||
Interest-bearing deposits with banks (b) |
6,400 |
4 |
0.26 |
5,308 |
4 |
0.26 |
4,785 |
2 |
0.25 |
|||||||||||||||||
Other short-term investments |
105 |
— |
0.69 |
110 |
— |
0.77 |
122 |
1 |
1.13 |
|||||||||||||||||
Total earning assets |
59,924 |
457 |
3.03 |
58,892 |
440 |
2.97 |
59,276 |
457 |
3.08 |
|||||||||||||||||
Cash and due from banks |
970 |
1,027 |
1,030 |
|||||||||||||||||||||||
Allowance for loan losses |
(609) |
(622) |
(654) |
|||||||||||||||||||||||
Accrued income and other assets |
4,320 |
4,363 |
4,605 |
|||||||||||||||||||||||
Total assets |
$ |
64,605 |
$ |
63,660 |
$ |
64,257 |
||||||||||||||||||||
Money market and interest-bearing checking deposits |
$ |
22,030 |
6 |
0.12 |
$ |
21,894 |
7 |
0.13 |
$ |
20,760 |
9 |
0.16 |
||||||||||||||
Savings deposits |
1,667 |
— |
0.03 |
1,680 |
— |
0.04 |
1,603 |
— |
0.03 |
|||||||||||||||||
Customer certificates of deposit |
5,078 |
5 |
0.38 |
5,384 |
6 |
0.41 |
5,634 |
6 |
0.49 |
|||||||||||||||||
Foreign office time deposits |
462 |
1 |
0.47 |
528 |
— |
0.48 |
527 |
1 |
0.60 |
|||||||||||||||||
Total interest-bearing deposits |
29,237 |
12 |
0.17 |
29,486 |
13 |
0.18 |
28,524 |
16 |
0.22 |
|||||||||||||||||
Short-term borrowings |
279 |
— |
0.06 |
249 |
— |
0.06 |
70 |
— |
0.12 |
|||||||||||||||||
Medium- and long-term debt |
3,563 |
14 |
1.53 |
3,590 |
14 |
1.54 |
4,735 |
16 |
1.35 |
|||||||||||||||||
Total interest-bearing sources |
33,079 |
26 |
0.31 |
33,325 |
27 |
0.32 |
33,329 |
32 |
0.38 |
|||||||||||||||||
Noninterest-bearing deposits |
23,532 |
22,379 |
22,758 |
|||||||||||||||||||||||
Accrued expenses and other liabilities |
984 |
1,033 |
1,108 |
|||||||||||||||||||||||
Total shareholders' equity |
7,010 |
6,923 |
7,062 |
|||||||||||||||||||||||
Total liabilities and shareholders' equity |
$ |
64,605 |
$ |
63,660 |
$ |
64,257 |
||||||||||||||||||||
Net interest income/rate spread (FTE) |
$ |
431 |
2.72 |
$ |
413 |
2.65 |
$ |
425 |
2.70 |
|||||||||||||||||
FTE adjustment |
$ |
1 |
$ |
1 |
$ |
1 |
||||||||||||||||||||
Impact of net noninterest-bearing sources of funds |
0.14 |
0.14 |
0.17 |
|||||||||||||||||||||||
Net interest margin (as a percentage of average earning assets) (FTE) (a) (b) |
2.86 |
% |
2.79 |
% |
2.87 |
% |
(a) |
Accretion of the purchase discount on the acquired loan portfolio of $23 million, $8 million and $13 million in the fourth and third quarters of 2013 and the fourth quarter of 2012, respectively, increased the net interest margin by 15 basis points, 5 basis points and 9 basis points in each respective period. |
(b) |
Excess liquidity, represented by average balances deposited with the Federal Reserve Bank, reduced the net interest margin by 31 basis points and 24 basis points in the fourth and third quarters of 2013, respectively, and by 22 basis points in the fourth quarter of 2012. |
CONSOLIDATED STATISTICAL DATA (unaudited) | ||||||||||||||||
Comerica Incorporated and Subsidiaries | ||||||||||||||||
December 31, |
September 30, |
June 30, |
March 31, |
December 31, | ||||||||||||
(in millions, except per share data) |
2013 |
2013 |
2013 |
2013 |
2012 | |||||||||||
Commercial loans: |
||||||||||||||||
Floor plan |
$ |
3,504 |
$ |
2,869 |
$ |
3,241 |
$ |
2,963 |
$ |
2,939 |
||||||
Other |
25,311 |
25,028 |
25,945 |
25,545 |
26,574 |
|||||||||||
Total commercial loans |
28,815 |
27,897 |
29,186 |
28,508 |
29,513 |
|||||||||||
Real estate construction loans: |
||||||||||||||||
Commercial Real Estate business line (a) |
1,447 |
1,283 |
1,223 |
1,185 |
1,049 |
|||||||||||
Other business lines (b) |
315 |
269 |
256 |
211 |
191 |
|||||||||||
Total real estate construction loans |
1,762 |
1,552 |
1,479 |
1,396 |
1,240 |
|||||||||||
Commercial mortgage loans: |
||||||||||||||||
Commercial Real Estate business line (a) |
1,678 |
1,592 |
1,743 |
1,812 |
1,873 |
|||||||||||
Other business lines (b) |
7,109 |
7,193 |
7,264 |
7,505 |
7,599 |
|||||||||||
Total commercial mortgage loans |
8,787 |
8,785 |
9,007 |
9,317 |
9,472 |
|||||||||||
Lease financing |
845 |
829 |
843 |
853 |
859 |
|||||||||||
International loans |
1,327 |
1,286 |
1,209 |
1,269 |
1,293 |
|||||||||||
Residential mortgage loans |
1,697 |
1,650 |
1,611 |
1,568 |
1,527 |
|||||||||||
Consumer loans: |
||||||||||||||||
Home equity |
1,517 |
1,501 |
1,474 |
1,498 |
1,537 |
|||||||||||
Other consumer |
720 |
651 |
650 |
658 |
616 |
|||||||||||
Total consumer loans |
2,237 |
2,152 |
2,124 |
2,156 |
2,153 |
|||||||||||
Total loans |
$ |
45,470 |
$ |
44,151 |
$ |
45,459 |
$ |
45,067 |
$ |
46,057 |
||||||
Goodwill |
$ |
635 |
$ |
635 |
$ |
635 |
$ |
635 |
$ |
635 |
||||||
Core deposit intangible |
16 |
17 |
18 |
19 |
20 |
|||||||||||
Loan servicing rights |
1 |
1 |
2 |
2 |
2 |
|||||||||||
Tier 1 common capital ratio (c) (d) |
10.60 |
% |
10.72 |
% |
10.43 |
% |
10.37 |
% |
10.14 |
% | ||||||
Tier 1 risk-based capital ratio (c) |
10.60 |
10.72 |
10.43 |
10.37 |
10.14 |
|||||||||||
Total risk-based capital ratio (c) |
13.05 |
13.42 |
13.29 |
13.41 |
13.15 |
|||||||||||
Leverage ratio (c) |
10.82 |
10.88 |
10.81 |
10.75 |
10.57 |
|||||||||||
Tangible common equity ratio (d) |
10.11 |
9.87 |
10.04 |
9.86 |
9.76 |
|||||||||||
Common shareholders' equity per share of common stock |
$ |
39.39 |
$ |
37.94 |
$ |
37.32 |
$ |
37.41 |
$ |
36.87 |
||||||
Tangible common equity per share of common stock (d) |
35.81 |
34.38 |
33.79 |
33.90 |
33.38 |
|||||||||||
Market value per share for the quarter: |
||||||||||||||||
High |
48.69 |
43.49 |
40.44 |
36.99 |
32.14 |
|||||||||||
Low |
38.64 |
38.56 |
33.55 |
30.73 |
27.72 |
|||||||||||
Close |
47.54 |
39.31 |
39.83 |
35.95 |
30.34 |
|||||||||||
Quarterly ratios: |
||||||||||||||||
Return on average common shareholders' equity |
8.26 |
% |
8.50 |
% |
8.23 |
% |
7.68 |
% |
7.36 |
% | ||||||
Return on average assets |
0.90 |
0.92 |
0.90 |
0.84 |
0.81 |
|||||||||||
Efficiency ratio (e) |
67.55 |
66.66 |
66.43 |
67.58 |
68.08 |
|||||||||||
Number of banking centers |
483 |
484 |
484 |
487 |
487 |
|||||||||||
Number of employees - full time equivalent |
8,948 |
8,918 |
8,929 |
9,001 |
9,035 |
(a) |
Primarily loans to real estate developers. |
|||||||||||||||
(b) |
Primarily loans secured by owner-occupied real estate. | |||||||||||||||
(c) |
December 31, 2013 ratios are estimated. | |||||||||||||||
(d) |
See Reconciliation of Non-GAAP Financial Measures. | |||||||||||||||
(e) |
Noninterest expenses as a percentage of the sum of net interest income (FTE) and noninterest income excluding net securities gains. |
PARENT COMPANY ONLY BALANCE SHEETS (unaudited) | |||||||||
Comerica Incorporated | |||||||||
December 31, |
September 30, |
December 31, | |||||||
(in millions, except share data) |
2013 |
2013 |
2012 | ||||||
ASSETS |
|||||||||
Cash and due from subsidiary bank |
$ |
31 |
$ |
36 |
$ |
2 |
|||
Short-term investments with subsidiary bank |
482 |
480 |
431 |
||||||
Other short-term investments |
96 |
92 |
88 |
||||||
Investment in subsidiaries, principally banks |
7,204 |
7,008 |
7,045 |
||||||
Premises and equipment |
4 |
4 |
4 |
||||||
Other assets |
139 |
134 |
150 |
||||||
Total assets |
$ |
7,956 |
$ |
7,754 |
$ |
7,720 |
|||
LIABILITIES AND SHAREHOLDERS' EQUITY |
|||||||||
Medium- and long-term debt |
$ |
617 |
$ |
620 |
$ |
629 |
|||
Other liabilities |
158 |
165 |
149 |
||||||
Total liabilities |
775 |
785 |
778 |
||||||
Common stock - $5 par value: |
|||||||||
Authorized - 325,000,000 shares |
|||||||||
Issued - 228,164,824 shares |
1,141 |
1,141 |
1,141 |
||||||
Capital surplus |
2,179 |
2,171 |
2,162 |
||||||
Accumulated other comprehensive loss |
(391) |
(541) |
(413) |
||||||
Retained earnings |
6,349 |
6,239 |
5,931 |
||||||
Less cost of common stock in treasury - 45,860,786 shares at 12/31/13, 44,483,659 shares at 9/30/13 and 39,889,610 shares at 12/31/12 |
(2,097) |
(2,041) |
(1,879) |
||||||
Total shareholders' equity |
7,181 |
6,969 |
6,942 |
||||||
Total liabilities and shareholders' equity |
$ |
7,956 |
$ |
7,754 |
$ |
7,720 |
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, 2011 |
197.3 |
$ |
1,141 |
$ |
2,170 |
$ |
(356) |
$ |
5,546 |
$ |
(1,633) |
$ |
6,868 |
|||||||
Net income |
— |
— |
— |
— |
521 |
— |
521 |
|||||||||||||
Other comprehensive loss, net of tax |
— |
— |
— |
(57) |
— |
— |
(57) |
|||||||||||||
Cash dividends declared on common stock ($0.55 per share) |
— |
— |
— |
— |
(106) |
— |
(106) |
|||||||||||||
Purchase of common stock |
(10.2) |
— |
— |
— |
— |
(308) |
(308) |
|||||||||||||
Net issuance of common stock under employee stock plans |
1.2 |
— |
(46) |
— |
(30) |
63 |
(13) |
|||||||||||||
Share-based compensation |
— |
— |
37 |
— |
— |
— |
37 |
|||||||||||||
Other |
— |
— |
1 |
— |
— |
(1) |
— |
|||||||||||||
BALANCE AT DECEMBER 31, 2012 |
188.3 |
$ |
1,141 |
$ |
2,162 |
$ |
(413) |
$ |
5,931 |
$ |
(1,879) |
$ |
6,942 |
|||||||
Net income |
— |
— |
— |
— |
569 |
— |
569 |
|||||||||||||
Other comprehensive income, net of tax |
— |
— |
— |
22 |
— |
— |
22 |
|||||||||||||
Cash dividends declared on common stock ($0.68 per share) |
— |
— |
— |
— |
(126) |
— |
(126) |
|||||||||||||
Purchase of common stock |
(7.5) |
— |
— |
— |
— |
(291) |
(291) |
|||||||||||||
Net issuance of common stock under employee stock plans |
1.5 |
— |
(17) |
— |
(25) |
72 |
30 |
|||||||||||||
Share-based compensation |
— |
— |
35 |
— |
— |
— |
35 |
|||||||||||||
Other |
— |
— |
(1) |
— |
— |
1 |
— |
|||||||||||||
BALANCE AT DECEMBER 31, 2013 |
182.3 |
$ |
1,141 |
$ |
2,179 |
$ |
(391) |
$ |
6,349 |
$ |
(2,097) |
$ |
7,181 |
BUSINESS SEGMENT FINANCIAL RESULTS (unaudited) | |||||||||||||||||||||||
Comerica Incorporated and Subsidiaries | |||||||||||||||||||||||
(dollar amounts in millions) |
Business |
Retail |
Wealth |
||||||||||||||||||||
Three Months Ended December 31, 2013 |
Bank |
Bank |
Management |
Finance |
Other |
Total | |||||||||||||||||
Earnings summary: |
|||||||||||||||||||||||
Net interest income (expense) (FTE) |
$ |
387 |
$ |
150 |
$ |
47 |
$ |
(161) |
$ |
8 |
$ |
431 |
|||||||||||
Provision for credit losses |
24 |
(8) |
(9) |
— |
2 |
9 |
|||||||||||||||||
Noninterest income |
80 |
43 |
61 |
14 |
6 |
204 |
|||||||||||||||||
Noninterest expenses |
151 |
180 |
82 |
2 |
14 |
429 |
|||||||||||||||||
Provision (benefit) for income taxes (FTE) |
92 |
7 |
12 |
(57) |
(2) |
52 |
|||||||||||||||||
Net income (loss) |
$ |
200 |
$ |
14 |
$ |
23 |
$ |
(92) |
$ |
— |
$ |
145 |
|||||||||||
Net credit-related charge-offs |
$ |
6 |
$ |
4 |
$ |
3 |
— |
— |
$ |
13 |
|||||||||||||
Selected average balances: |
|||||||||||||||||||||||
Assets |
$ |
35,042 |
$ |
5,997 |
$ |
4,873 |
$ |
11,032 |
$ |
7,661 |
$ |
64,605 |
|||||||||||
Loans |
34,020 |
5,323 |
4,711 |
— |
— |
44,054 |
|||||||||||||||||
Deposits |
26,873 |
21,438 |
3,933 |
323 |
202 |
52,769 |
|||||||||||||||||
Statistical data: |
|||||||||||||||||||||||
Return on average assets (a) |
2.29 |
% |
0.25 |
% |
1.86 |
% |
N/M |
N/M |
0.90 |
% | |||||||||||||
Efficiency ratio (b) |
32.23 |
93.18 |
75.84 |
N/M |
N/M |
67.55 |
|||||||||||||||||
Business |
Retail |
Wealth |
|||||||||||||||||||||
Three Months Ended September 30, 2013 |
Bank |
Bank |
Management |
Finance |
Other |
Total | |||||||||||||||||
Earnings summary: |
|||||||||||||||||||||||
Net interest income (expense) (FTE) |
$ |
368 |
$ |
151 |
$ |
45 |
$ |
(159) |
$ |
8 |
$ |
413 |
|||||||||||
Provision for credit losses |
(1) |
10 |
1 |
— |
(2) |
8 |
|||||||||||||||||
Noninterest income |
89 |
45 |
61 |
18 |
1 |
214 |
|||||||||||||||||
Noninterest expenses |
153 |
177 |
81 |
2 |
4 |
417 |
|||||||||||||||||
Provision (benefit) for income taxes (FTE) |
96 |
3 |
9 |
(56) |
3 |
55 |
|||||||||||||||||
Net income (loss) |
$ |
209 |
$ |
6 |
$ |
15 |
$ |
(87) |
$ |
4 |
$ |
147 |
|||||||||||
Net credit-related charge-offs |
$ |
9 |
$ |
7 |
$ |
3 |
— |
— |
$ |
19 |
|||||||||||||
Selected average balances: |
|||||||||||||||||||||||
Assets |
$ |
35,298 |
$ |
5,967 |
$ |
4,789 |
$ |
11,097 |
$ |
6,509 |
$ |
63,660 |
|||||||||||
Loans |
34,178 |
5,285 |
4,631 |
— |
— |
44,094 |
|||||||||||||||||
Deposits |
26,284 |
21,257 |
3,782 |
319 |
223 |
51,865 |
|||||||||||||||||
Statistical data: |
|||||||||||||||||||||||
Return on average assets (a) |
2.38 |
% |
0.12 |
% |
1.21 |
% |
N/M |
N/M |
0.92 |
% | |||||||||||||
Efficiency ratio (b) |
33.50 |
90.27 |
77.22 |
N/M |
N/M |
66.66 |
|||||||||||||||||
Business |
Retail |
Wealth |
|||||||||||||||||||||
Three Months Ended December 31, 2012 |
Bank |
Bank |
Management |
Finance |
Other |
Total | |||||||||||||||||
Earnings summary: |
|||||||||||||||||||||||
Net interest income (expense) (FTE) |
$ |
387 |
$ |
156 |
$ |
47 |
$ |
(176) |
11 |
$ |
425 |
||||||||||||
Provision for credit losses |
6 |
7 |
2 |
— |
1 |
16 |
|||||||||||||||||
Noninterest income |
79 |
43 |
65 |
15 |
2 |
204 |
|||||||||||||||||
Noninterest expenses |
149 |
181 |
84 |
3 |
10 |
427 |
|||||||||||||||||
Provision (benefit) for income taxes (FTE) |
102 |
3 |
10 |
(62) |
3 |
56 |
|||||||||||||||||
Net income (loss) |
$ |
209 |
$ |
8 |
$ |
16 |
$ |
(102) |
$ |
(1) |
$ |
130 |
|||||||||||
Net credit-related charge-offs |
$ |
26 |
$ |
6 |
$ |
5 |
— |
— |
$ |
37 |
|||||||||||||
Selected average balances: |
|||||||||||||||||||||||
Assets |
$ |
35,359 |
$ |
5,952 |
$ |
4,686 |
$ |
12,137 |
$ |
6,123 |
$ |
64,257 |
|||||||||||
Loans |
34,325 |
5,255 |
4,539 |
— |
— |
44,119 |
|||||||||||||||||
Deposits |
26,051 |
20,910 |
3,798 |
310 |
213 |
51,282 |
|||||||||||||||||
Statistical data: |
|||||||||||||||||||||||
Return on average assets (a) |
2.37 |
% |
0.15 |
% |
1.35 |
% |
N/M |
N/M |
0.81 |
% | |||||||||||||
Efficiency ratio (b) |
31.93 |
90.36 |
76.88 |
N/M |
N/M |
68.08 |
(a) |
Return on average assets is calculated based on the greater of average assets or average liabilities and attributed equity. |
(b) |
Noninterest expenses as a percentage of the sum of net interest income (FTE) and noninterest income excluding net securities gains. |
FTE - Fully Taxable Equivalent | |
N/M - Not Meaningful |
MARKET SEGMENT FINANCIAL RESULTS (unaudited) | |||||||||||||||||||||||
Comerica Incorporated and Subsidiaries | |||||||||||||||||||||||
(dollar amounts in millions) |
Other |
Finance |
|||||||||||||||||||||
Three Months Ended December 31, 2013 |
Michigan |
California |
Texas |
Markets |
& Other |
Total | |||||||||||||||||
Earnings summary: |
|||||||||||||||||||||||
Net interest income (expense) (FTE) |
$ |
187 |
$ |
176 |
$ |
147 |
$ |
74 |
$ |
(153) |
$ |
431 |
|||||||||||
Provision for credit losses |
7 |
(8) |
5 |
3 |
2 |
9 |
|||||||||||||||||
Noninterest income |
89 |
37 |
33 |
25 |
20 |
204 |
|||||||||||||||||
Noninterest expenses |
170 |
100 |
93 |
50 |
16 |
429 |
|||||||||||||||||
Provision (benefit) for income taxes (FTE) |
36 |
45 |
30 |
— |
(59) |
52 |
|||||||||||||||||
Net income (loss) |
$ |
63 |
$ |
76 |
$ |
52 |
$ |
46 |
$ |
(92) |
$ |
145 |
|||||||||||
Net credit-related charge-offs (recoveries) |
$ |
(4) |
$ |
(2) |
$ |
13 |
$ |
6 |
$ |
— |
$ |
13 |
|||||||||||
Selected average balances: |
|||||||||||||||||||||||
Assets |
$ |
13,712 |
$ |
14,710 |
$ |
10,458 |
$ |
7,032 |
$ |
18,693 |
$ |
64,605 |
|||||||||||
Loans |
13,323 |
14,431 |
9,766 |
6,534 |
— |
44,054 |
|||||||||||||||||
Deposits |
20,501 |
15,219 |
10,536 |
5,988 |
525 |
52,769 |
|||||||||||||||||
Statistical data: |
|||||||||||||||||||||||
Return on average assets (a) |
1.18 |
% |
1.87 |
% |
1.76 |
% |
2.65 |
% |
N/M |
0.90 |
% | ||||||||||||
Efficiency ratio (b) |
61.53 |
47.00 |
51.71 |
49.70 |
N/M |
67.55 |
|||||||||||||||||
Other |
Finance |
||||||||||||||||||||||
Three Months Ended September 30, 2013 |
Michigan |
California |
Texas |
Markets |
& Other |
Total | |||||||||||||||||
Earnings summary: |
|||||||||||||||||||||||
Net interest income (expense) (FTE) |
$ |
186 |
$ |
171 |
$ |
129 |
$ |
78 |
$ |
(151) |
$ |
413 |
|||||||||||
Provision for credit losses |
(8) |
(3) |
17 |
4 |
(2) |
8 |
|||||||||||||||||
Noninterest income |
88 |
42 |
35 |
30 |
19 |
214 |
|||||||||||||||||
Noninterest expenses |
167 |
101 |
92 |
51 |
6 |
417 |
|||||||||||||||||
Provision (benefit) for income taxes (FTE) |
42 |
44 |
20 |
2 |
(53) |
55 |
|||||||||||||||||
Net income (loss) |
$ |
73 |
$ |
71 |
$ |
35 |
$ |
51 |
$ |
(83) |
$ |
147 |
|||||||||||
Net credit-related charge-offs |
$ |
1 |
$ |
8 |
$ |
4 |
$ |
6 |
$ |
— |
$ |
19 |
|||||||||||
Selected average balances: |
|||||||||||||||||||||||
Assets |
$ |
13,744 |
$ |
14,245 |
$ |
10,642 |
$ |
7,423 |
$ |
17,606 |
$ |
63,660 |
|||||||||||
Loans |
13,276 |
14,002 |
9,942 |
6,874 |
— |
44,094 |
|||||||||||||||||
Deposits |
20,465 |
14,567 |
10,298 |
5,993 |
542 |
51,865 |
|||||||||||||||||
Statistical data: |
|||||||||||||||||||||||
Return on average assets (a) |
1.38 |
% |
1.84 |
% |
1.21 |
% |
2.73 |
% |
N/M |
0.92 |
% | ||||||||||||
Efficiency ratio (b) |
60.89 |
47.37 |
56.52 |
47.65 |
N/M |
66.66 |
|||||||||||||||||
Other |
Finance |
||||||||||||||||||||||
Three Months Ended December 31, 2012 |
Michigan |
California |
Texas |
Markets |
& Other |
Total | |||||||||||||||||
Earnings summary: |
|||||||||||||||||||||||
Net interest income (expense) (FTE) |
$ |
192 |
$ |
178 |
$ |
136 |
$ |
84 |
$ |
(165) |
$ |
425 |
|||||||||||
Provision for credit losses |
(8) |
7 |
4 |
12 |
1 |
16 |
|||||||||||||||||
Noninterest income |
97 |
35 |
31 |
24 |
17 |
204 |
|||||||||||||||||
Noninterest expenses |
180 |
100 |
90 |
44 |
13 |
427 |
|||||||||||||||||
Provision (benefit) for income taxes (FTE) |
43 |
44 |
26 |
2 |
(59) |
56 |
|||||||||||||||||
Net income (loss) |
$ |
74 |
$ |
62 |
$ |
47 |
$ |
50 |
$ |
(103) |
$ |
130 |
|||||||||||
Net credit-related charge-offs |
$ |
1 |
$ |
12 |
$ |
5 |
$ |
19 |
$ |
— |
$ |
37 |
|||||||||||
Selected average balances: |
|||||||||||||||||||||||
Assets |
$ |
13,782 |
$ |
13,549 |
$ |
10,554 |
$ |
8,112 |
$ |
18,260 |
$ |
64,257 |
|||||||||||
Loans |
13,415 |
13,275 |
9,818 |
7,611 |
— |
44,119 |
|||||||||||||||||
Deposits |
20,019 |
15,457 |
9,809 |
5,474 |
523 |
51,282 |
|||||||||||||||||
Statistical data: |
|||||||||||||||||||||||
Return on average assets (a) |
1.42 |
% |
1.50 |
% |
1.71 |
% |
2.48 |
% |
N/M |
0.81 |
% | ||||||||||||
Efficiency ratio (b) |
62.14 |
47.04 |
53.87 |
41.38 |
N/M |
68.08 |
(a) |
Return on average assets is calculated based on the greater of average assets or average liabilities and attributed equity. |
(b) |
Noninterest expenses as a percentage of the sum of net interest income (FTE) and noninterest income excluding net securities gains. |
FTE - Fully Taxable Equivalent | |
N/M - Not Meaningful |
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES (unaudited) | |||||||||||||||
Comerica Incorporated and Subsidiaries | |||||||||||||||
December 31, |
September 30, |
June 30, |
March 31, |
December 31, | |||||||||||
(dollar amounts in millions) |
2013 |
2013 |
2013 |
2013 |
2012 | ||||||||||
Tier 1 Common Capital Ratio: |
|||||||||||||||
Tier 1 and Tier 1 common capital (a) (b) |
$ |
6,924 |
$ |
6,862 |
$ |
6,800 |
$ |
6,748 |
$ |
6,705 |
|||||
Risk-weighted assets (a) (b) |
$ |
65,301 |
$ |
64,027 |
$ |
65,220 |
$ |
65,099 |
$ |
66,115 |
|||||
Tier 1 and Tier 1 common risk-based capital ratio (b) |
10.60 |
% |
10.72 |
% |
10.43 |
% |
10.37 |
% |
10.14 |
% | |||||
Basel III Tier 1 Common Capital Ratio: |
|||||||||||||||
Tier 1 common capital (b) |
$ |
6,924 |
$ |
6,862 |
$ |
6,800 |
$ |
6,748 |
$ |
6,705 |
|||||
Basel III adjustments (c) |
(6) |
(4) |
— |
(1) |
(39) |
||||||||||
Basel III Tier 1 common capital (c) |
6,918 |
6,858 |
6,800 |
6,747 |
6,666 |
||||||||||
Risk-weighted assets (a) (b) |
$ |
65,301 |
$ |
64,027 |
$ |
65,220 |
$ |
65,099 |
$ |
66,115 |
|||||
Basel III adjustments (c) |
1,735 |
1,726 |
2,091 |
1,996 |
1,854 |
||||||||||
Basel III risk-weighted assets (c) |
$ |
67,036 |
$ |
65,753 |
$ |
67,311 |
$ |
67,095 |
$ |
67,969 |
|||||
Tier 1 common capital ratio (b) |
10.6 |
% |
10.7 |
% |
10.4 |
% |
10.4 |
% |
10.1 |
% | |||||
Basel III Tier 1 common capital ratio (c) |
10.3 |
10.4 |
10.1 |
10.1 |
9.8 |
||||||||||
Tangible Common Equity Ratio: |
|||||||||||||||
Common shareholders' equity |
$ |
7,181 |
$ |
6,969 |
$ |
6,911 |
$ |
6,988 |
$ |
6,942 |
|||||
Less: |
|||||||||||||||
Goodwill |
635 |
635 |
635 |
635 |
635 |
||||||||||
Other intangible assets |
17 |
18 |
20 |
21 |
22 |
||||||||||
Tangible common equity |
$ |
6,529 |
$ |
6,316 |
$ |
6,256 |
$ |
6,332 |
$ |
6,285 |
|||||
Total assets |
$ |
65,210 |
$ |
64,670 |
$ |
62,947 |
$ |
64,885 |
$ |
65,069 |
|||||
Less: |
|||||||||||||||
Goodwill |
635 |
635 |
635 |
635 |
635 |
||||||||||
Other intangible assets |
17 |
18 |
20 |
21 |
22 |
||||||||||
Tangible assets |
$ |
64,558 |
$ |
64,017 |
$ |
62,292 |
$ |
64,229 |
$ |
64,412 |
|||||
Common equity ratio |
11.01 |
% |
10.78 |
% |
10.98 |
% |
10.77 |
% |
10.67 |
% | |||||
Tangible common equity ratio |
10.11 |
9.87 |
10.04 |
9.86 |
9.76 |
||||||||||
Tangible Common Equity per Share of Common Stock: |
|||||||||||||||
Common shareholders' equity |
$ |
7,181 |
$ |
6,969 |
$ |
6,911 |
$ |
6,988 |
$ |
6,942 |
|||||
Tangible common equity |
6,529 |
6,316 |
6,256 |
6,332 |
6,285 |
||||||||||
Shares of common stock outstanding (in millions) |
182 |
184 |
185 |
187 |
188 |
||||||||||
Common shareholders' equity per share of common stock |
$ |
39.39 |
$ |
37.94 |
$ |
37.32 |
$ |
37.41 |
$ |
36.87 |
|||||
Tangible common equity per share of common stock |
35.81 |
34.38 |
33.79 |
33.90 |
33.38 |
(a) |
Tier 1 capital and risk-weighted assets as defined by regulation. |
(b) |
December 31, 2013 Tier 1 capital and risk-weighted assets are estimated. |
(c) |
Estimated ratios based on the standardized approach in the final rule for the U.S. adoption of the Basel III regulatory capital framework and excluding most elements of AOCI. |
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 Basel III Tier 1 common capital ratio further adjusts Tier 1 common capital and risk-weighted assets to account for the final rule approved by U.S. banking regulators in July 2013 for the U.S. adoption of the Basel III regulatory capital framework. The final Basel III capital rules are effective January 1, 2015 for banking organizations subject to the standardized approach. The tangible common equity ratio removes preferred stock and the effect of intangible assets from capital and the effect of intangible assets from total assets. Tangible common equity per share of common stock removes the effect of intangible assets from common shareholders equity per share of common stock. Comerica believes these measurements are meaningful measures of capital adequacy used by investors, regulators, management and others to evaluate the adequacy of common equity and to compare against other companies in the industry.
SOURCE Comerica Incorporated