Comerica Reports 14% Sequential EPS Growth in Q2

Core Insights - Comerica reported Q2 2025 earnings with an EPS of $1.42, reflecting a nearly 14% sequential increase, and returned $193 million to shareholders through stock repurchases and dividends [1] - The company highlighted loan growth, normalization of deposits, disciplined expense control, and strong capital position, maintaining a net interest income growth guidance of 5% to 7% for the year despite short-term challenges [1][9] Loan Growth and Business Momentum - Comerica achieved approximately 3% loan growth and increased total commitments by $400 million, with notable activity in environmental services and commercial real estate [2] - Management indicated improving middle market loan pipelines and a positive sentiment among customers, suggesting a potential recovery in business confidence [3] Deposit Stability and Technology Investments - Non-interest-bearing deposits remained stable at 38% of total deposits for four consecutive quarters, showcasing resilience amid sector challenges [4] - The launch of two new real-time payment solutions aims to enhance customer relationships and improve funding mix quality [5] Expense Management and Capital Strength - Non-interest expenses decreased by $23 million quarter-over-quarter, leading to an improved efficiency ratio, while the CET1 ratio stood at 11.94%, above the internal target [6] - The strong capital position allowed for increased share repurchases of $100 million in Q2, although efficiency metrics remain a concern for management [8] Future Outlook - Management forecasts average loans to be flat to down 1% in 2025, with average deposits expected to decline by 2% to 3% [9] - Net interest income is projected to grow by 5% to 7% for the year, with a slight dip anticipated in Q3 before resuming growth in Q4 [9]