Comerica (CMA), OCC Enters Agreement Over Compliance Issues

Core Viewpoint - Comerica Incorporated (CMA) has entered into an enforcement agreement with the Office of the Comptroller of the Currency (OCC) due to unsafe practices in risk governance and internal controls, resulting in a 5.7% decline in its stock price following the announcement [1]. Group 1: Compliance and Governance - CMA is required to establish a compliance committee to ensure proper board oversight and corporate governance as mandated by the OCC [2]. - The bank must implement a comprehensive data management plan to ensure accurate financial transaction reporting [2]. - Independent reviews are necessary for improving financial data collection and regulatory reporting to ensure compliance [2]. Group 2: Risk Management and Technology - CMA is mandated to create a third-party risk management program that integrates strong internal controls with an updated internal audit program for independent evaluations [3]. - The bank must address risks associated with outdated IT assets, including policies for managing technology assets and conducting risk assessments [3]. Group 3: Board Oversight and Accountability - The board of directors at Comerica is responsible for overseeing the implementation of corrective actions outlined in the agreement, including authorizing necessary measures and ensuring adequate staffing and training [4]. Group 4: Historical Context and Performance - Prior to the enforcement agreement, Comerica faced issues due to a failed technological update that resulted in significant overdrawing of accounts [5]. - The bank had also mismanaged the Treasury Department's Direct Express program, leading to compliance failures and breaches of contractual obligations [6]. - Over the past six months, Comerica's shares have increased by 16.1%, while the industry has seen a growth of 30.7% [6].