Core Insights - Comerica Incorporated (CMA) reported fourth-quarter 2025 adjusted earnings per share (EPS) of $1.46, exceeding the Zacks Consensus Estimate of $1.28, and up from $1.20 in the prior-year quarter [1][9] - The results were driven by an increase in net interest income (NII), fee income, and deposit balances, although concerns arose from lower loan balances and rising expenses [1][11] Financial Performance - For the fourth quarter, net income attributable to common shareholders (GAAP basis) was $176 million, a 3.5% increase from the year-ago quarter [2] - Total quarterly revenues reached $850 million, a slight year-over-year increase, but missed the consensus estimate of $850.1 million [4] - For the full year 2025, adjusted EPS was $5.47, up from $5.02 in the previous year, surpassing the Zacks Consensus Estimate of $5.23 [3] - Total revenues for 2025 were $3.37 billion, an increase from $3.24 billion in 2024, beating the consensus estimate of $3.36 billion [4] Income and Expenses - Quarterly NII rose marginally to $577 million, with the net interest margin increasing by 1 basis point to 3.07% [4] - Total non-interest income was $273 million, reflecting a 9.2% year-over-year increase [5] - Non-interest expenses totaled $617 million, up 5.1% year over year, leading to an efficiency ratio of 72.30%, compared to 69.51% in the prior-year quarter [5] Loan and Deposit Trends - As of December 31, 2025, total loans decreased slightly to $50.7 billion, while total deposits increased by 3.6% to $64.9 billion [6][9] Credit Quality - The provision for credit loss was $14 million in the fourth quarter, down from $21 million in the year-ago quarter [7] - Total non-performing assets decreased by 18.5% year over year to $251 million [7] - The allowance for credit losses to total loans ratio was 1.45%, up from 1.44% in the previous year [8] Capital Position - The total capital ratio improved to 14.25%, up from 14.21% in the prior-year quarter [10] - The Common Equity Tier 1 capital ratio increased to 12.02%, compared to 11.89% in the previous year [10] - The tangible common equity ratio was 8.40%, up from 7% in the prior-year quarter [10] Strategic Outlook - The planned merger with Fifth Third Bancorp is expected to enhance Comerica's scale, diversification, and competitiveness in key growth markets, with the transaction anticipated to close in the first quarter of 2026 [12]

Core Insights - Comerica Incorporated (CMA) reported revenue of $850 million for the quarter ended December 2025, reflecting a year-over-year increase of 0.7% [1] - Earnings per share (EPS) for the quarter was $1.46, up from $1.20 in the same quarter last year [1] - The reported revenue was slightly below the Zacks Consensus Estimate of $850.07 million, resulting in a surprise of -0.01% [1] - The company did not meet the consensus EPS estimate of $1.28, indicating no EPS surprise [1] Financial Metrics - Efficiency Ratio stood at 72.3%, higher than the average estimate of 71% based on four analysts [4] - Net interest margin was reported at 3.1%, matching the average estimate of 3.1% [4] - Net charge-offs (recoveries) to average total loans were 0%, better than the average estimate of 0.2% [4] - Average balance of total earning assets was $72.4 billion, exceeding the average estimate of $72.11 billion [4] - Total nonperforming assets were $251 million, slightly below the average estimate of $253.53 million [4] - Total noninterest income was $273 million, close to the average estimate of $273.78 million [4] - Net interest income was reported at $577 million, slightly below the average estimate of $577.24 million [4] - Service charges on deposit accounts were $48 million, above the average estimate of $47.15 million [4] - Fiduciary income was $55 million, in line with the average estimate of $55.08 million [4] - Commercial lending fees were $16 million, below the average estimate of $17.45 million [4] - Bank-owned life insurance income was $11 million, exceeding the average estimate of $9.05 million [4] - Capital markets income was reported at $36 million, below the average estimate of $45.26 million [4] Stock Performance - Comerica's shares have returned +3.2% over the past month, outperforming the Zacks S&P 500 composite's +1.6% change [3] - The stock currently holds a Zacks Rank 3 (Hold), suggesting it may perform in line with the broader market in the near term [3]

Core Insights - Fifth Third Bancorp is set to utilize traditional mail as a strategy to retain customers from its recent acquisition of Comerica, planning to send out 13 million to 14 million mailers in 2026 [2][9] - The merger with Comerica, which has cleared regulatory hurdles, will create a combined bank with approximately $290 billion in assets, ranking it as the 16th-largest depository institution in the U.S. [3][4] Marketing Strategy - The bank's marketing approach will include cash bonuses and promotional rates to encourage existing Comerica customers to stay or switch to Fifth Third [5] - Fifth Third's direct marketing strategy is split evenly between mail and digital, with a focus on mail for existing Comerica customers due to the lack of digital account opening capabilities at Comerica [5][6] Operational Insights - The transition to Fifth Third's systems is expected to be completed by the end of the third quarter of 2026, with mailers being the primary method of communication until then [6] - CEO Tim Spence emphasized the precision of direct mail marketing, allowing targeted offers to individual households, contrasting it with broader digital marketing strategies [7][8] Financial Performance - In the fourth quarter of 2025, Fifth Third reported a net income of $699 million, surpassing analyst expectations of $660.5 million, and total revenue of $2.344 billion, slightly above estimates [10]

Financial Data and Key Metrics Changes - The company reported earnings per share of $1.04, or $1.08 excluding certain items, with an adjusted return on equity of 14.5% and an adjusted return on assets of 1.41% [3][4] - Adjusted fourth quarter revenues rose 5% year over year, driven by a 6% increase in net interest income and a 13% increase in wealth and asset management fees [4][15] - The CET1 ratio increased to 10.8%, and tangible book value per share grew 21% year over year [4][25] Business Line Data and Key Metrics Changes - Average loans increased by 5% year over year, with consumer loans and middle market C&I loans both growing by 7% [4][15] - Wealth and asset management fees increased by 13%, with assets under management reaching $80 billion [9][20] - Commercial payments fees grew by 8% year over year, driven by core treasury management activity [20] Market Data and Key Metrics Changes - In the Southeast, the company opened 50 new branches, contributing to a 2.5% growth in net new consumer households year over year [5][19] - The Southeast consumer deposits increased by 4% sequentially, accounting for over 50% of total consumer deposit growth for the quarter [19][20] - The company achieved the number two origination market share in HELOC within its footprint, up from number four in the prior year [17] Company Strategy and Development Direction - The company is focused on stability, profitability, and growth, with a disciplined approach to operations and long-term investments [3] - The merger with Comerica is expected to close on February 1, 2026, with anticipated expense synergies of $850 million and revenue synergies of over $500 million over the next five years [10][11] - The company aims to accelerate retail deposit growth and improve the combined company's funding profile through targeted marketing [27][50] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to navigate uncertain environments and deliver strong shareholder returns [3][26] - The outlook for 2026 includes expectations for full-year net interest income to range between $8.6 billion and $8.8 billion, with a focus on improving the balance sheet [27][29] - Management noted that while 2025 was eventful, the company is pleased with its disciplined operating performance and ability to meet financial commitments [26] Other Important Information - The company shipped over 400 updates to its consumer mobile app in 2025, which was recognized as the top mobile banking app for user satisfaction among regional banks [5][6] - The net charge-off ratio was 40 basis points for the quarter, the lowest level in the past seven quarters, indicating improved asset quality [4][23] Q&A Session Summary Question: What are the biggest opportunities with Comerica? - Management highlighted immediate opportunities in leveraging Comerica's existing customer base and expanding into Texas markets, with a focus on innovation banking as a long-term opportunity [33][34] Question: How is the integration of Comerica progressing? - The integration is ahead of schedule, with the conversion date moved up to Labor Day from mid-October, allowing for earlier realization of revenue and expense synergies [41][43] Question: What is the outlook for C&I loan growth? - Management noted that while utilization dipped during the government shutdown, there has been a rebound, and C&I loan balances have increased since January 1 [45][46]

Group 1 - Fifth Third Bank and Comerica are undergoing a merger, with a focus on aligning staffing to meet future business needs, although specific job cut figures have not been disclosed [3][6] - The merger, valued at $10.9 billion, has received Federal Reserve approval and has been supported by shareholders despite opposition from an activist investor [3][4] - Fifth Third has identified $850 million in cost savings from the merger, primarily through the elimination of facilities, systems, vendors, and some headcount reductions [4] Group 2 - The conversion for Comerica customers is now set for Labor Day, earlier than initially planned, which is expected to enhance expense synergies this year [5] - Job cuts are anticipated, with a notification indicating that 184 Comerica jobs will be eliminated at its Frisco location, effective March 13 [6]

Core Viewpoint - Comerica Incorporated has reported its fourth quarter and full-year 2025 financial results, with a pending merger with Fifth Third Bancorp affecting its earnings conference call plans [1]. Company Overview - Comerica Incorporated is a financial services company based in Dallas, Texas, organized into three business segments: The Commercial Bank, The Retail Bank, and Wealth Management [2]. - As one of the 25 largest commercial U.S. financial holding companies, Comerica operates banking centers across Arizona, California, Florida, Michigan, and Texas [2]. - The company reported total assets of $80.1 billion as of December 31, 2025 [2].

Financial Performance - Net income for Q4 2025 was $176 million, up from $170 million in Q4 2024, with diluted earnings per share increasing to $1.27 from $1.22 year-over-year[1] - Net income attributable to common shares for Q4 2025 was $164 million, slightly up from $163 million in Q4 2024[4] - Comprehensive income for the year ended December 31, 2025, was $1.805 billion, significantly higher than $585 million in 2024[4] - Net interest income for the year ended December 31, 2025, was $2.301 billion, an increase from $2.190 billion in 2024[1] - Net interest income after provision for credit losses increased to $563 million in Q4 2025, up 2% from $554 million in Q4 2024[5] - Noninterest income totaled $273 million in Q4 2025, representing a 9% increase from $250 million in Q4 2024[5] - Total noninterest expenses rose to $617 million in Q4 2025, a 5% increase from $587 million in Q4 2024[5] Capital Position - The common equity tier 1 capital ratio improved to 12.02% in Q4 2025 from 11.89% in Q4 2024, indicating stronger capital position[1] - Common equity tier 1 capital increased to $8,754 million as of December 31, 2025, up from $8,667 million a year earlier, reflecting a growth of 1.0%[10] - The Tier 1 capital ratio improved to 12.56% in Q4 2025, compared to 12.43% in Q4 2024, indicating a stronger capital position[10] - Tangible common equity rose to $6,676 million, a 21.1% increase from $5,508 million in the previous year[10] - Total shareholders' equity reached $7,707 million, up from $6,543 million year-over-year, representing a growth of 17.7%[10] - The common equity tier 1 capital ratio was 12.02% as of December 31, 2025, compared to 11.89% a year prior, showing an improvement in capital quality[10] - Tangible common equity per share of common stock increased to $52.16, up from $41.91 in the previous year, reflecting a growth of 24.5%[10] - The common shareholders' equity per share of common stock was $57.16, an increase from $46.79 year-over-year, representing a growth of 22.1%[10] Asset Quality - Nonperforming assets decreased to $251 million in Q4 2025 from $308 million in Q4 2024, reflecting improved credit quality[1] - The allowance for credit losses as a percentage of total loans was 1.45% in Q4 2025, slightly up from 1.44% in Q4 2024, suggesting a cautious approach to credit risk[1] - Risk-weighted assets were reported at $72,841 million, slightly down from $72,903 million a year earlier[10] - The tangible common equity ratio improved to 8.40 as of December 31, 2025, compared to 7.00 a year earlier, indicating enhanced asset quality[10] Operational Efficiency - The efficiency ratio for Q4 2025 was 72.30%, compared to 69.51% in Q4 2024, indicating a slight decline in operational efficiency[1] - Total loans increased to $51.012 billion in Q4 2025, compared to $50.617 billion in Q4 2024, with commercial loans at $26.891 billion[1] - Total interest income for Q4 2025 was $932 million, a decrease of 4% compared to $967 million in Q4 2024[4] Strategic Developments - The number of banking centers decreased to 352 from 381 year-over-year, indicating a strategic consolidation[1] - The merger-related expense for Q4 2025 was $32 million, impacting net income calculations[6] - The company expects the merger with Fifth Third Bancorp to close in Q1 2026, pending customary closing conditions[7] - Cash dividends declared remained stable at $0.71 per share for both Q4 2025 and Q4 2024[1] - The company declared cash dividends of $90 million on common stock in Q4 2025, consistent with Q4 2024[4] Asset Growth - Total assets as of December 31, 2025, were $80.074 billion, up from $79.297 billion a year earlier[3] - The total assets increased to $80,074 million from $79,297 million year-over-year, reflecting a growth of 1.0%[10]

Core Insights - The Comerica Hatch Detroit Contest by TechTown is an annual small business competition offering $100,000 in startup funding and support services to entrepreneurs aiming to establish brick-and-mortar stores in Detroit, Hamtramck, or Highland Park [1][2][3] Contest Details - Applications for the contest are open until February 27, 2026, and are available on HatchDetroit.com [2][15] - The competition includes public voting rounds to select the Top 4 finalists, culminating in a live presentation event called the Hatch Off on May 13, 2026 [4][5] Financial Commitment - Comerica Bank and the Comerica Charitable Foundation have committed $200,000 to the Hatch Detroit program for the second consecutive year, in addition to providing in-kind support [7][10] - Since 2012, Comerica has contributed over $1.5 million to the Hatch Detroit initiative [11] Impact on Local Economy - The Hatch Detroit Contest has successfully helped create numerous small businesses, employing over 500 people and generating more than $12 million in investments [14][17] - TechTown has supported 7,000 companies, resulting in the creation of over 3,000 jobs and raising more than $480 million in startup and growth capital since 2007 [16] Historical Context - The contest has been running since 2011 and has produced notable winners such as Walter Pat's Bakery Cafe and other successful small businesses [13][14]

Core Viewpoint - Fifth Third Bancorp and Comerica are set to complete their $10.9 billion merger on February 1, following the final regulatory approval from the Federal Reserve, marking a significant expansion for Fifth Third as it becomes the 16th-largest insured depository organization in the U.S. with $290 billion in assets [1][2][4]. Regulatory Approval - The merger received approval from the Federal Reserve, the Office of the Comptroller of the Currency, and the Texas Department of Banking, with shareholders from both companies overwhelmingly voting in favor [2][3]. - The Federal Reserve's review indicated that the merger would not have significantly adverse effects on competition, following a Department of Justice assessment [4]. Financial Aspects - Analysts have noted the transaction's financial benefits, including immediate earnings accretion, no dilution to tangible book value per share, and a potential for over $500 million in annual revenue synergies [6]. - Since the announcement of the merger, Fifth Third's stock has increased by approximately 8%, while Comerica's stock has surged by about 27% [6]. Integration Plans - Integration teams from both banks have begun working on transition plans, with expectations to complete full system and brand conversions later in the year [3]. Legal Challenges - An activist investor, HoldCo Asset Management, has filed a lawsuit against Comerica and Fifth Third, alleging breaches of fiduciary duties and inadequate disclosures regarding the merger [7][10]. - The lawsuit claims that Comerica rushed into the merger to avoid a proxy contest and negotiated an excessive compensation package for its CEO, Curt Farmer [10][14]. - A hearing regarding the ongoing litigation is scheduled for later in February, which may impact the merger's timeline [12]. Leadership Transition - Following the merger, Comerica's CEO Curt Farmer will serve as vice chair and later in an advisory role at Fifth Third, with an annual compensation of $8.75 million [15].

Core Viewpoint - The Federal Reserve has approved Fifth Third's acquisition of Comerica, marking the final regulatory approval needed for the largest proposed banking deal of 2025, expected to close on February 1, with subsequent system and brand conversions later in the year [1] Group 1: Acquisition Details - Fifth Third's CEO Tim Spence expressed excitement over securing all material approvals, highlighting immediate earnings accretion, no dilution to tangible book value per share, and a clear path to over $500 million in annual revenue synergies from the merger [2] - The acquisition faced opposition from activist investor HoldCo Asset Management, which argued that Comerica could have secured a better deal and subsequently sued the bank [2][3] Group 2: Regulatory Comments and Reactions - The Federal Reserve received 12 adverse comments regarding the deal, with requests for hearings related to HoldCo's lawsuit against both banks, which alleges a breach of fiduciary duty by Comerica's board [3] - Commenters also requested an extension of the comment period for the acquisition to allow the Fed to review material expected from the court case, which was denied [4] Group 3: Executive Compensation - Comerica's CEO Curt Farmer is set to become a vice chair at Fifth Third post-acquisition, with an annual compensation of $8.75 million, alongside a $10 million cash payment for integration and $10.63 million in deferred compensation [5]