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Dec 31, 2019
Comerica Q4 2019 Earnings Report
Comerica's Q4 2019 net income was $269 million, or $1.85 per share, reflecting robust deposit growth, capital management, and strong credit quality.
Key Takeaways
Comerica Incorporated reported a net income of $269 million, or $1.85 per share, for the fourth quarter of 2019. The results reflected robust deposit growth, capital management, and strong credit quality. Deposits increased $1.5 billion relative to the third quarter, with over 40% from noninterest-bearing deposits.
Net income for Q4 2019 was $269 million, translating to $1.85 per share.
The return on equity stood at 15 percent, while the return on assets was 1.5 percent.
Robust deposit growth was observed, with a $1.5 billion increase relative to the third quarter.
Over 40 percent of the deposit growth came from noninterest-bearing deposits.
Comerica
Comerica
Forward Guidance
For full-year 2020 compared to full-year 2019 reported results, management expects the following, assuming a continuation of the current economic and rate environment:
Positive Outlook
- 2 percent to 3 percent growth in average loans, reflecting increases in most lines of business, partly offset by declines in Mortgage Banker Finance and National Dealer Services.
- 1 percent to 2 percent increase in average deposits, with a continued focus on attracting and retaining relationship-based deposits.
- Continued strong credit quality, with net credit-related charge-offs similar to 2019 levels (15 basis points to 25 basis points).
- 1 percent growth in noninterest income, reflecting growth in card fees and fiduciary income, partially offset by lower derivative and warrant income, and assuming no returns on deferred compensation assets.
- Income tax expense to be approximately 23 percent of pre-tax income.
Challenges Ahead
- Decrease in net interest income due to the net impact of lower interest rates, 2019 funding actions and lower nonaccrual interest recoveries, partially offset by loan growth.
- $10 million to $15 million net reduction from interest rates in first quarter 2020 compared to fourth quarter 2019, with a modest decrease for the remainder of the year.
- 3 percent increase in noninterest expenses, reflecting higher outside processing expenses in line with growing revenue, technology expenditures, typical inflationary pressures and higher pension expense.
- Common equity Tier 1 capital ratio target of approximately 10 percent.