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Press release from PR Newswire

/C O R R E C T I O N -- Comerica Incorporated/

Friday, January 20, 2012

/C O R R E C T I O N -- Comerica Incorporated/06:40 EST Friday, January 20, 2012In the news release, Comerica Reports Fourth Quarter 2011 Net Income of $96 Million, issued 20-Jan-2012 by Comerica Incorporated over PR Newswire, we are advised by the company that in the first table, row titled "Tier 1 common capital ratio (c)", the number in the first column should read "10.31%" rather than "10.30%" as originally issued inadvertently. The complete, corrected release follows: Comerica Reports Fourth Quarter 2011 Net Income of $96 Million Period-end Total Loan Growth of $1.5 Billion; Commercial Loans Increased $1.9 Billion Net Interest Income up Five Percent Record Deposits of $47.8 Billion Repurchased 4.1 Million Shares(1) in 2011 DALLAS, Jan. 20, 2012 /PRNewswire/ -- Comerica Incorporated (NYSE: CMA) today reported fourth quarter 2011 net income of $96 million, a decrease of $2 million compared to $98 million for the third quarter 2011. Fourth quarter 2011 included merger and restructuring charges of $37 million ($23 million, after tax; $0.12 per diluted share) associated with the acquisition of Sterling Bancshares, Inc. (Sterling), completed on July 28, 2011, compared to $33 million ($21 million, after tax; $0.11 per diluted share) in the third quarter 2011.(Logo:  http://photos.prnewswire.com/prnh/20010807/CMALOGO) (dollar amounts in millions, except per share data)4th Qtr '113rd Qtr '114th Qtr '10Net interest income$  444$  423$  405Provision for loan losses193857Noninterest income182201215Noninterest expenses (a)478460437Provision for income taxes332830Net income 969896Net income attributable to common shares959795Diluted income per common share0.480.510.53Average diluted shares (in millions)197192178Tier 1 common capital ratio (c)10.31% (b) 10.57%10.13%Tangible common equity ratio (c)10.2710.4310.54(a) Included restructuring expenses of $37 million and $33 million in the fourth and third quarters of 2011, respectively, associated with the acquisition of Sterling.(b) December 31, 2011 ratio is estimated.(c) See Reconciliation of Non-GAAP Financial Measures."We were pleased to see total loan growth of $1.5 billion, or 4 percent, on a period-end basis," said Ralph W. Babb Jr., chairman and chief executive officer.  "The growth was driven by a $1.9 billion, or 8 percent, increase in commercial loans, particularly in National Dealer Services, Mortgage Banker Finance, Energy Lending, Technology and Life Sciences, and Global Corporate Banking."We had record deposit levels of $47.8 billion at year-end, an increase of $303 million from the third quarter.  In addition, our net interest income increased $21 million, or 5 percent, primarily driven by an increase in average earning assets.  We continue to be pleased by the broad-based improvement in credit quality, which resulted in a decrease in the provision for loan losses.""With respect to our acquisition of Sterling, we announced the successful completion of systems integrations and the opening of former Sterling branches as Comerica banking centers on November 14, 2011," said Babb. "All former Sterling customers can now bank at any Comerica banking center, with complete access to our full line of extended product and service offerings. This acquisition continues to be a great fit, as the former Sterling's size, geographic footprint and customer focus uniquely fits our strategy and expands our presence in Texas."In the fourth quarter, we repurchased 1.6 million shares, and repurchased a total of 4.1 million shares in 2011 under the share repurchase program. Combined with dividends, this resulted in a total return to shareholders of 47 percent of net income. We continue to be an active capital manager and believe we are approaching capital management from a position of strength.  As required, we submitted our Capital Plan to the Federal Reserve on January 9, 2012.  As previously announced, we are targeting a first quarter 2012 total payout ratio of up to 50 percent of net income through the share repurchase program and dividends."(1) Shares repurchased under Comerica's share repurchase program.Fourth Quarter and Full-Year 2011 OverviewFourth Quarter 2011 Highlights Compared to Third Quarter 2011Period-end total loans increased $1.5 billion, or 4 percent, from September 30, 2011 to December 31, 2011, primarily reflecting an increase of $1.9 billion, or 8 percent, in commercial loans, partially offset by a decrease of $390 million in commercial real estate loans (commercial mortgage and real estate construction loans).  The increase in commercial loans was primarily driven by increases in National Dealer Services, Mortgage Banker Finance, Energy Lending, Technology and Life Sciences, and Global Corporate Banking.  Average total loans increased $1.4 billion, or 3 percent, in the fourth quarter, in part due to one additional month of Sterling.Period-end deposits increased $303 million, or one percent, primarily reflecting an increase of $648 million in noninterest-bearing deposits, partially offset by decreases in savings ($247 million) and customer certificates of deposit ($172 million). Average total deposits increased $2.7 billion, in part due to one additional month of Sterling in the fourth quarter.Net interest income of $444 million increased $21 million, or 5 percent, compared to the third quarter, primarily resulting from an increase in average earning assets of $2.4 billion.Credit quality continued to improve in the fourth quarter 2011. Net credit-related charge-offs decreased $17 million to $60 million.  The provision for loan losses decreased to $19 million in the fourth quarter 2011, compared to $38 million in the third quarter 2011.Noninterest income decreased $19 million to $182 million in the fourth quarter 2011, compared to $201 million for the third quarter 2011, primarily due to a $16 million decrease in net securities gains (losses), reflecting a net loss of $4 million in the fourth quarter 2011 compared to a net gain of $12 million in the third quarter 2011.Noninterest expenses increased $18 million to $478 million in the fourth quarter 2011, compared to $460 million in the third quarter 2011, primarily due to increases in severance and related expenses ($5 million) and merger and restructuring charges ($4 million), as well as one additional month of Sterling expenses (approximately $8 million).Full-Year 2011 Highlights Compared to Full-Year 2010Net income of $393 million for 2011 increased $116 million, or 42 percent, compared to 2010.Period-end total loans increased $2.4 billion, or 6 percent, from year-end 2010 to year-end 2011, reflecting the acquisition of Sterling and primarily including a net increase of $2.9 billion, or 13 percent, in commercial loans, partially offset by a net decrease of $223 million in commercial real estate loans.  The increase in commercial loans was primarily driven by increases in Mortgage Banker Finance, Energy Lending and Technology and Life Sciences, as well as increases in Middle Market and Global Corporate Banking.  Average loans declined $442 million in 2011.Period-end deposits increased $7.3 billion, or 18 percent, in part due to the acquisition of Sterling. Average total deposits increased $4.3 billion.Net interest income increased $7 million in 2011, compared to 2010, as the benefit provided by accretion of the purchase discount on the acquired Sterling loan portfolio in 2011 and an increase in average earning assets of $1.1 billion was largely offset by decreased yields on mortgage-backed investment securities and a decrease in business loan swap income. Credit quality improved significantly.  The provision for loan losses declined $327 million to $153 million in 2011, compared to 2010.  Net credit-related charge-offs decreased $236 million to $328 million.    Noninterest income increased $3 million compared to 2010.Noninterest expenses increased $122 million compared to 2010.  2011 included Sterling-related merger and restructuring charges of $75 million ($47 million, after-tax; $0.25 per diluted share) and five months of Sterling expenses.Repurchases of 4.1 million shares in 2011, combined with dividends, returned 47 percent of 2011 net income to shareholders.Net Interest Income(dollar amounts in millions)4th Qtr '113rd Qtr '114th Qtr '10Net interest income$      444$      423$      405Net interest margin 3.19%3.18%3.29%Selected average balances (a):Total earning assets$ 55,676$ 53,243$ 49,102Total investment securities9,7818,1587,112Total loans41,45440,09839,999Total deposits 47,77945,09840,356Total noninterest-bearing deposits19,17617,51115,607(a) Average balances in 3rd quarter 2011 included Sterling balances from July 28 through September 30, 2011.The $21 million increase in net interest income in the fourth quarter 2011, when compared to the third quarter 2011, resulted primarily from an increase in average earning assets of $2.4 billion, partially offset by decreasing yields on mortgage-backed investment securities and a decrease in the accretion of the purchase discount on the acquired Sterling loan portfolio.  Decreasing yields on the mortgage-backed investment securities portfolio reflected the impact of lower yields on securities purchased to reinvest prepayments.  Accretion of the purchase discount was $26 million in the fourth quarter 2011, compared to $27 million in the third quarter.     Average earning assets increased $2.4 billion in the fourth quarter 2011, compared to the third quarter 2011, reflecting increases of $1.6 billion in average investment securities available-for-sale and $1.4 billion in average loans, partially offset by a $584 million decrease in average Federal Reserve Bank deposits. The increase in average loans included one additional month of Sterling in the fourth quarter and primarily reflected increases in commercial loans in Mortgage Banker Finance, Energy Lending, National Dealer Services, and Technology and Life Sciences.Average deposits increased $2.7 billion in the fourth quarter 2011, compared to the third quarter 2011, in part due to one additional month of Sterling. Average noninterest-bearing deposits increased $1.7 billion and average money market and NOW deposits increased $1.1 billion.Noninterest IncomeNoninterest income was $182 million for the fourth quarter 2011, compared to $201 million for the third quarter 2011. The $19 million decrease was primarily due to decreases in net securities gains (losses) ($16 million) and card fees ($6 million), due primarily to the implementation of regulatory limits on debit card transaction processing fees, partially offset by an increase in deferred compensation asset returns ($5 million) (offset by an increase in deferred compensation plan costs in noninterest expenses).  Net securities gains (losses) in the third quarter 2011 reflected net gains of $12 million due primarily to the repositioning of the acquired Sterling investment securities portfolio, compared to a net loss of $4 million in the fourth quarter 2011 that resulted primarily from a $5 million charge related to a derivative contract tied to the conversion rate of Visa Class B shares. Noninterest Expenses Noninterest expenses totaled $478 million in the fourth quarter 2011, an increase of $18 million compared to $460 million in the third quarter 2011. The increase was primarily due to increases in deferred compensation plan costs ($5 million) (offset by an increase in deferred compensation asset returns in noninterest income), severance and related expenses ($5 million) and merger and restructuring charges ($4 million), as well as one additional month of Sterling expenses (approximately $8 million).  Credit Quality"We continued to see steady improvement in credit trends in the fourth quarter," said Babb.  "This was the 10th consecutive quarter of decline in net charge-offs, with a $17 million decrease.  The decline in net charge-offs was larger than expected, primarily the result of higher recoveries in the quarter. Other credit metrics were in line with expectations.  Nonperforming assets were under $1 billion for the first time since the fourth quarter of 2008.   The former Sterling loan portfolio has performed as expected. As a result of the overall improvements in credit quality, the provision for loan losses declined to $19 million."(dollar amounts in millions)4th Qtr '113rd Qtr '114th Qtr '10Net credit-related charge-offs$ 60$    77$  113Net credit-related charge-offs/Average total loans0.57%0.77%1.13%Provision for loan losses$ 19$    38$    57Provision for credit losses on lending-relatedcommitments(1)(3)(3)Total provision for credit losses183554Nonperforming loans (a)8879581,123Nonperforming assets (NPAs) (a)9811,0451,235NPAs/Total loans and foreclosed property 2.29%2.53%3.06%Loans past due 90 days or more and still accruing$ 58$    81$    62Allowance for loan losses726767901Allowance for credit losses on lending-related commitments (b)262735Total allowance for credit losses752794936Allowance for loan losses/Total loans (c)1.70%1.86%2.24%Allowance for loan losses/Nonperforming loans 828080(a) Excludes loans acquired with credit impairment.(b) Included in "Accrued expenses and other liabilities" on the consolidated balance sheets.(c) Reflects the impact of acquired loans, which were initially recorded at fair value, with no related allowance for loan losses.Net credit-related charge-offs decreased $17 million to $60 million in the fourth quarter 2011, from $77 million in the third quarter 2011. The decrease in net credit-related charge-offs primarily reflected decreases in Small Business Banking ($12 million), Middle Market ($11 million) and Commercial Real Estate ($7 million), partially offset by an increase in Technology and Life Sciences ($10 million).Internal watch list loans declined $502 million in the fourth quarter 2011, to $4.5 billion at December 31, 2011, and nonperforming assets decreased $64 million.During the fourth quarter 2011, $99 million of borrower relationships greater than $2 million were transferred to nonaccrual status, a decrease of $31 million from the third quarter 2011.  Of the transfers of borrower relationships greater than $2 million to nonaccrual in the fourth quarter 2011, $27 million were from Commercial Real Estate, $24 million were from Private Banking and $21 million were from Global Corporate Banking. Nonperforming loans decreased $71 million, compared to September 30, 2011, to $887 million, or 2.08 percent of total loans, at December 31, 2011. Balance Sheet and Capital ManagementTotal assets and common shareholders' equity were $61.0 billion and $6.9 billion, respectively, at December 31, 2011, compared to $60.9 billion and $7.0 billion, respectively, at September 30, 2011. There were approximately 197 million common shares outstanding at December 31, 2011. Comerica repurchased 1.6 million and 4.1 million shares of common stock in the open market in the fourth quarter and full-year 2011, respectively, under the share repurchase program.Comerica's tangible common equity ratio was 10.27 percent at December 31, 2011, a decrease of 16 basis points from September 30, 2011.  The estimated Tier 1 common capital ratio decreased 26 basis points, to 10.31 percent at December 31, 2011, from September 30, 2011.  Full-Year 2012 Outlook Compared to Full-Year 2011For 2012, management expects the following, assuming a continuation of the current economic environment:Average loans increasing moderately. Net interest income increasing moderately.  Net credit-related charge-offs declining and a relatively stable provision for credit losses.Noninterest income relatively stable.  Noninterest expenses relatively stable.Business SegmentsComerica's operations are strategically aligned into three major business segments: the Business Bank, the Retail Bank, and Wealth Management.  The Finance Division is also included as a segment. The financial results below are based on the internal business unit structure of the Corporation and methodologies in effect at December 31, 2011 and are presented on a fully taxable equivalent (FTE) basis. The accompanying narrative addresses fourth quarter 2011 results compared to third quarter 2011.The following table presents net income (loss) by business segment.(dollar amounts in millions)4th Qtr '113rd Qtr '114th Qtr '10Business Bank$ 20194%$ 17986%$ 174117%Retail Bank104199(14)(10)Wealth Management52115(10)(7)216100%209100%150100%Finance(95)(91)(60)Other (a)(25)(20)6     Total$   96$   98$   96(a) Includes discontinued operations and items not directly associated with the three major business segments or the Finance Division.Business Bank(dollar amounts in millions)4th Qtr '113rd Qtr '114th Qtr '10Net interest income (FTE)$         382$         363$         341Provision for loan losses(4)208Noninterest income737781Noninterest expenses161162158Net income 201179174Net credit-related charge-offs324073Selected average balances:Assets32,15030,60830,489Loans31,25729,95529,947Deposits23,29621,75919,892Net interest margin 4.83%4.81%4.51%Average loans increased $1.3 billion, primarily reflecting increases in Mortgage Banker Finance, Energy Lending, National Dealer Services, Technology and Life Sciences and Commercial Real Estate, partially offset by a decrease in Global Corporate Banking.Average deposits increased $1.5 billion, reflecting increases across most business lines, primarily Middle Market, Energy Lending, the Financial Services Division, Technology and Life Sciences and Global Corporate Banking.Net interest income of $382 million increased $19 million, primarily due to increases in loan and deposit balances as well as an increase in the benefit provided by accretion of the purchase discount on the acquired Sterling loan portfolio.The provision for loan losses decreased $24 million, primarily reflecting decreases in Middle Market and Commercial Real Estate, partially offset by an increase in Technology and Life Sciences.Noninterest income decreased $4 million, primarily due to a decrease in warrant income.Retail Bank (dollar amounts in millions)4th Qtr '113rd Qtr '114th Qtr '10Net interest income (FTE)$         176$         173$         134Provision for loan losses151729Noninterest income354743Noninterest expenses182174169Net income (loss)1019(14)Net credit-related charge-offs162822Selected average balances:Assets6,2505,9845,647Loans5,5715,4835,192Deposits20,71519,79217,271Net interest margin 3.37%3.46%3.07%Average loans increased $88 million, primarily due to an increase in the Texas market, partially offset by declines in the Midwest and Western markets. Average deposits increased $923 million, primarily due to one additional month of Sterling in the fourth quarter.Net interest income of $176 million increased $3 million, primarily due to an increase in average loan and deposit balances, partially offset by a decrease in the accretion of the purchase discount on the acquired Sterling loan portfolio.The provision for loan losses decreased $2 million, primarily reflecting a decline in Small Business Banking, partially offset by an increase in Personal Banking.Noninterest income declined $12 million, primarily due to a decrease in card fees, reflecting the implementation of regulatory limits on debit card transaction processing fees, and a $5 million charge related to a derivative contract tied to the conversion rate of Visa Class B shares.  Noninterest expenses increased $8 million, primarily due to one additional month of Sterling noninterest expense.Wealth Management (dollar amounts in millions)4th Qtr '113rd Qtr '114th Qtr '10Net interest income (FTE)$           46$           45$           42Provision for loan losses10623Noninterest income555659Noninterest expenses837893Net income (loss)511(10)Net credit-related charge-offs12918Selected average balances:Assets4,6724,6744,834Loans4,6184,6524,820Deposits3,4003,1982,730Net interest margin 4.00%3.85%3.43%Average loans decreased $34 million. Average deposits increased $202 million, primarily reflecting increases in the Midwest, Western and Texas markets. Net interest income of $46 million increased $1 million, primarily due to an increase in average deposit balances.The provision for loan losses increased $4 million.Noninterest expenses increased $5 million, primarily due to an increase in other real estate expenses and a charge related to technology upgrades.Geographic Market SegmentsComerica also provides market segment results for four primary geographic markets: Midwest, Western, Texas and Florida.  In addition to the four primary geographic markets, Other Markets and International are also reported as market segments.  The financial results below are based on methodologies in effect at December 31, 2011 and are presented on a fully taxable equivalent (FTE) basis. The accompanying narrative addresses fourth quarter 2011 results compared to third quarter 2011.The following table presents net income (loss) by market segment.(dollar amounts in millions)4th Qtr '113rd Qtr '114th Qtr '10Midwest $  5325%$  5928%$ 3523%Western653050244128Texas552664301611Florida(1)(1)111-Other Markets321523114832International12512696216100%209100%150100%Finance & Other Businesses (a)(120)(111)(54)     Total$  96$  98$ 96(a) Includes discontinued operations and items not directly associated with the geographic markets.Midwest Market(dollar amounts in millions)4th Qtr '113rd Qtr '114th Qtr '10Net interest income (FTE)$         201$         199$         202Provision for loan losses202146Noninterest income859699Noninterest expenses185183201Net income535935Net credit-related charge-offs323352Selected average balances:Assets13,98014,12314,506Loans13,72513,87314,219Deposits19,07618,51117,959Net interest margin 4.18%4.27%4.45%Average loans decreased $148 million, as an increase in National Dealer Services was more than offset by declines in Small Business Banking, Middle Market, Global Corporate Banking and Personal Banking.  Average deposits increased $565 million, primarily due to increases in the Financial Services Division and Middle Market.Net interest income increased $2 million, primarily due to an increase in average deposits.The provision for loan losses decreased $1 million, primarily reflecting a decrease in Middle Market, partially offset by increases in Commercial Real Estate, Small Business Banking, and Private Banking.Noninterest income decreased $11 million, primarily due to a decline in card fees and a $4 million charge related to a derivative contract tied to Visa Class B shares, as previously described in the Retail Bank section.Western Market(dollar amounts in millions)4th Qtr '113rd Qtr '114th Qtr '10Net interest income (FTE)$         170$         166$         158Provision for loan losses(12)1411Noninterest income333235Noninterest expenses109105109Net income655041Net credit-related charge-offs53243Selected average balances:Assets12,26612,11012,698Loans12,02611,88912,497Deposits13,67112,97512,448Net interest margin 4.92%5.06%5.01%Average loans increased $137 million, primarily due to increases in Technology and Life Sciences and National Dealer Services, partially offset by a decrease in Middle Market.  Average deposits increased $696 million, primarily reflecting increases in Middle Market, Technology and Life Sciences, Global Corporate Banking and Private Banking.Net interest income increased $4 million, primarily due to an increase in average deposits.The provision for loan losses decreased $26 million, primarily reflecting decreases in Small Business Banking, Commercial Real Estate and Middle Market.Noninterest expenses increased $4 million, primarily due to increases in salaries and benefits expenses and other real estate expenses.Texas Market (dollar amounts in millions)4th Qtr '113rd Qtr '114th Qtr '10Net interest income (FTE)$         158$         143$           80Provision for loan losses8(7)15Noninterest income262927Noninterest expenses898067Net income 556416Net credit-related charge-offs429Selected average balances:Assets9,7128,5106,653Loans8,9528,1456,435Deposits10,3338,8655,557Net interest margin 6.07%6.40%4.91%Average loans increased $807 million, primarily reflecting increases in Energy Lending, Small Business Banking, Commercial Real Estate and Middle Market, in part due to one additional month of Sterling in the fourth quarter.Average deposits increased $1.5 billion, primarily reflecting one additional month of Sterling.Net interest income increased $15 million, primarily due to one additional month of Sterling.The provision for loan losses increased $15 million, primarily reflecting increases in Middle Market and Small Business Banking.Noninterest income decreased $3 million, primarily due to a decrease in warrant income.Noninterest expenses increased $9 million, primarily due to one additional month of Sterling.Florida Market(dollar amounts in millions)4th Qtr '113rd Qtr '114th Qtr '10Net interest income (FTE)$           11$           11$           11Provision for loan losses424Noninterest income443Noninterest expenses13119Net income (1)11Net credit-related charge-offs757Selected average balances:Assets1,4351,4501,587Loans1,4571,4771,612Deposits435404375Net interest margin 2.89%2.94%2.64%Average loans decreased $20 million, as an increase in National Dealer Services was more than offset by decreases in Commercial Real Estate and Private Banking.The provision for loan losses increased $2 million, primarily reflecting an increase in Commercial Real Estate.Conference Call and WebcastComerica will host a conference call to review fourth quarter and full-year 2011 financial results at 7 a.m. CT Friday, January 20, 2012. Interested parties may access the conference call by calling (800) 309-2262 or (706) 679-5261 (event ID No. 37433486). The call and supplemental financial information can also be accessed on the Internet at www.comerica.com.  A telephone replay will be available approximately two hours following the conference call through January 31, 2012. The conference call replay can be accessed by calling (855) 859-2056 or (404) 537-3406 (event ID No. 37433486). A replay of the Webcast can also 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 the reconcilement 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," "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," "pending," "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 and related credit and market conditions; changes in trade, monetary and fiscal policies, including the interest rate policies of the Federal Reserve Board; adverse conditions in the capital markets; the interdependence of financial service companies; changes in regulation or oversight, including the effects of recently enacted legislation, actions taken by or proposed by the U.S. Treasury, the Board of Governors of the Federal Reserve System, the Texas Department of Banking and the Federal Deposit Insurance Corporation, legislation or regulations enacted in the future, and the impact and expiration of such legislation and regulatory actions; unfavorable developments concerning credit quality; the acquisition of Sterling Bancshares, Inc., or any future acquisitions; the effects of more stringent capital or liquidity requirements; declines or other changes in the businesses or industries in which Comerica has a concentration of loans, including, but not limited to, the automotive production industry and the real estate business lines; the implementation of Comerica's strategies and business models, including the anticipated performance of any new banking centers and the implementation of revenue enhancements and efficiency improvements; Comerica's ability to utilize technology to efficiently and effectively develop, market and deliver new products and services; operational difficulties or information security problems; changes in the financial markets, including fluctuations in interest rates and their impact on deposit pricing; the entry of new competitors in Comerica's markets; changes in customer borrowing, repayment, investment and deposit practices; 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; the effectiveness of methods of reducing risk exposures; the effects of war and other armed conflicts or acts of terrorism and the effects of catastrophic events including, but not limited to, hurricanes, tornadoes, earthquakes, fires, droughts and floods. 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 16 of Comerica's Annual Report on Form 10-K for the year ended December 31, 2010, "Item 1A. Risk Factors" beginning on page 65 of Comerica's Quarterly Report on Form 10-Q for the quarter ended March 31, 2011, "Item 1A. Risk Factors" beginning on page 74 of Comerica's Quarterly Report on Form 10-Q for the quarter ended June 30, 2011 and "Item 1A. Risk Factors" beginning on page 81 of Comerica's Quarterly Report on Form 10-Q for the quarter ended September 30, 2011. 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 SubsidiariesThree Months EndedYears EndedDecember 31,September 30,December 31,December 31,(in millions, except per share data)20112011201020112010PER COMMON SHARE AND COMMON STOCK DATADiluted net income $     0.48$     0.51$     0.53$     2.09$     0.88Cash dividends declared0.100.100.100.400.25Common shareholders' equity (at period end)34.8034.9432.82Average diluted shares (in thousands)196,729191,634178,266186,168173,026KEY RATIOSReturn on average common shareholders' equity5.51%5.91%6.53%6.18%2.74%Return on average assets0.630.670.710.690.50Tier 1 common capital ratio (a) (b)10.3110.5710.13Tier 1 risk-based capital ratio (b)10.3510.6510.13Total risk-based capital ratio (b)14.1814.8414.54Leverage ratio (b)10.9211.4111.26Tangible common equity ratio (a)10.2710.4310.54AVERAGE BALANCES Commercial loans $ 23,515$ 22,127$ 21,464$ 22,208$ 21,090Real estate construction loans:      Commercial Real Estate business line (c)1,1891,2911,9441,4292,404      Other business lines (d)430408427414435                Total real estate construction loans1,6191,6992,3711,8432,839Commercial mortgage loans:     Commercial Real Estate business line (c)2,5522,4152,0162,2172,000     Other business lines (d)7,8367,8607,9497,8088,244                Total commercial mortgage loans10,38810,2759,96510,02510,244Residential mortgage loans 1,5911,6061,6001,5801,607Consumer loans 2,2942,2922,3672,2782,429Lease financing9199361,0449501,086International loans1,1281,1631,1881,1911,222Total loans41,45440,09839,99940,07540,517Earning assets55,67653,24349,10252,12151,004Total assets61,04558,23853,75656,91755,553Noninterest-bearing deposits19,17617,51115,60716,99415,094Interest-bearing deposits28,60327,58724,74926,76824,392Total deposits47,77945,09840,35643,76239,486Common shareholders' equity6,9476,6335,8706,3515,625Total shareholders' equity6,9476,6335,8706,3516,068NET INTEREST INCOMENet interest income (fully taxable equivalent basis) $      445$      424$      406$   1,657$   1,651Fully taxable equivalent adjustment11145Net interest margin (fully taxable equivalent basis)3.19%3.18%3.29%3.19%3.24%CREDIT QUALITYNonaccrual loans$      860$      929$   1,080Reduced-rate loans272943Total nonperforming loans (e)8879581,123Foreclosed property9487112Total nonperforming assets (e)9811,0451,235Loans past due 90 days or more and still accruing588162Gross loan charge-offs8590140$      423$      627Loan recoveries2513279563Net loan charge-offs6077113328564Lending-related commitment charge-offs-----Total net credit-related charge-offs6077113328564Allowance for loan losses726767901Allowance for credit losses on lending-related commitments262735Total allowance for credit losses752794936Allowance for loan losses as a percentage of total loans (f)1.70%1.86%2.24%Net loan charge-offs as a percentage of average total loans 0.570.771.130.82%1.39%Net credit-related charge-offs as a percentage of average total loans 0.570.771.130.821.39Nonperforming assets as a percentage of total loans and foreclosed property (e)2.292.533.06Allowance for loan losses as a percentage of total nonperforming loans828080(a) See Reconciliation of Non-GAAP Financial Measures.(b) December 31, 2011 ratios are estimated.(c) Primarily loans to real estate investors and developers.(d) Primarily loans secured by owner-occupied real estate.(e) Excludes loans acquired with credit-impairment.(f) Reflects the impact of acquired loans, which were initially recorded at fair value with no related allowance for loan losses. CONSOLIDATED BALANCE SHEETS Comerica Incorporated and Subsidiaries December 31,September 30,December 31,(in millions, except share data)201120112010(unaudited)(unaudited)ASSETSCash and due from banks$               982$                 981$               668Interest-bearing deposits with banks2,5744,2171,415Other short-term investments149137141Investment securities available-for-sale10,1049,7327,560Commercial loans24,99623,11322,145Real estate construction loans1,5331,6482,253Commercial mortgage loans10,26410,5399,767Residential mortgage loans1,5261,6431,619Consumer loans2,2852,3092,311Lease financing9059271,009International loans1,1701,0461,132Total loans42,67941,22540,236Less allowance for loan losses(726)(767)(901)Net loans41,95340,45839,335Premises and equipment675685630Customers' liability on acceptances outstanding2289Accrued income and other assets4,5494,6703,909Total assets$          61,008$            60,888$          53,667LIABILITIES AND SHAREHOLDERS' EQUITYNoninterest-bearing deposits$          19,764$            19,116$          15,538Money market and NOW deposits 20,31120,23717,622Savings deposits1,5241,7711,397Customer certificates of deposit5,8085,9805,482Other time deposits-45-Foreign office time deposits348303432Total interest-bearing deposits27,99128,33624,933Total deposits47,75547,45240,471Short-term borrowings70164130Acceptances outstanding2289Accrued expenses and other liabilities1,3491,3041,126Medium- and long-term debt4,9445,0096,138Total liabilities54,14053,93747,874Common stock - $5 par value:     Authorized - 325,000,000 shares     Issued - 228,164,824 shares at 12/31/11 and 9/30/11,          and 203,878,110 shares at 12/31/101,1411,1411,019Capital surplus2,1702,1621,481Accumulated other comprehensive loss(356)(230)(389)Retained earnings5,5465,4715,247Less cost of common stock in treasury - 30,831,076 shares at 12/31/11,      29,238,425 shares at 9/30/11 and 27,342,518 shares at 12/31/10(1,633)(1,593)(1,565)Total shareholders' equity6,8686,9515,793Total liabilities and shareholders' equity$          61,008$            60,888$          53,667CONSOLIDATED STATEMENTS OF INCOME (unaudited)Comerica Incorporated and SubsidiariesThree Months EndedYears EndedDecember 31, December 31, (in millions, except per share data)2011201020112010INTEREST INCOMEInterest and fees on loans$  415$  394$ 1,564$ 1,617Interest on investment securities6349233226Interest on short-term investments321210Total interest income4814451,8091,853INTEREST EXPENSEInterest on deposits212490115Interest on short-term borrowings-1-1Interest on medium- and long-term debt16156691Total interest expense3740156207Net interest income4444051,6531,646Provision for loan losses1957153480Net interest income after provision for loan losses4253481,5001,166NONINTEREST INCOMEService charges on deposit accounts5249208208Fiduciary income3639151154Commercial lending fees23298795Letter of credit fees 18207376Card fees11155858Foreign exchange income10114039Bank-owned life insurance10143740Brokerage fees572225Net securities gains (losses)(4)-143Other noninterest income213110291Total noninterest income182215792789NONINTEREST EXPENSESSalaries205205770740Employee benefits5243205179     Total salaries and employee benefits257248975919Net occupancy expense4742169162Equipment expense17166663Outside processing fee expense272710196Software expense23238889Merger and restructuring charges37-75-FDIC insurance expense8154362Legal fees1494335Advertising expense782830Other real estate expense352229Litigation and operational losses161711Provision for credit losses on lending-related commitments(1)(3)(9)(2)Other noninterest expenses3841144146Total noninterest expenses4784371,7621,640Income from continuing operations before income taxes 129126530315Provision for income taxes333013755Income from continuing operations9696393260Income from discontinued operations, net of tax---17NET INCOME9696393277Less:    Preferred stock dividends---123    Income allocated to participating securities1141Net income attributable to common shares$    95$    95$    389$    153Basic earnings per common share:      Income from continuing operations$ 0.48$ 0.54$   2.11$   0.79      Net income 0.480.542.110.90Diluted earnings per common share:     Income from continuing operations0.480.532.090.78     Net income 0.480.532.090.88Cash dividends declared on common stock20187544Cash dividends declared per common share0.100.100.400.25CONSOLIDATED QUARTERLY STATEMENTS OF INCOME (unaudited)Comerica Incorporated and SubsidiariesFourthThirdSecondFirstFourthFourth Quarter 2011 Compared To:QuarterQuarterQuarterQuarterQuarterThird Quarter 2011Fourth Quarter 2010(in millions, except per share data)20112011201120112010AmountPercent  Amount  PercentINTEREST INCOMEInterest and fees on loans$    415$    405$    369$    375$    394$        103%$         215%Interest on investment securities63545957499161427Interest on short-term investments34322(1)(7)1 N/M Total interest income481463431434445184368INTEREST EXPENSEInterest on deposits2124232224(3)(10)(3)(16)Interest on short-term borrowings----1-(34)(1)(78)Interest on medium- and long-term debt1616171715-212Total interest expense3740403940(3)(5)(3)(9)Net interest income4444233913954052153910Provision for loan losses1938474957(19)(50)(38)(67)Net interest income after provision for loan losses42538534434634840107722NONINTEREST INCOMEService charges on deposit accounts5253515249(1)(3)36Fiduciary income3637393939(1)(2)(3)(7)Commercial lending fees2322212129110(6)(20)Letter of credit fees 1819181820(1)(2)(2)(9)Card fees1117151515(6)(32)(4)(26)Foreign exchange income101110911(1)(3)(1)(1)Bank-owned life insurance10109814-2(4)(31)Brokerage fees55667-(11)(2)(28)Net securities gains (losses)(4)1242-(16) N/M (4) N/M Other noninterest income2115293731634(10)(31)Total noninterest income182201202207215(19)(9)(33)(15)NONINTEREST EXPENSESSalaries205192185188205137--Employee benefits5253505043(1)(1)920     Total salaries and employee benefits25724523523824812594Net occupancy expense474438404238513Equipment expense1717171516-518Outside processing fee expense272525242725-(1)Software expense232220232314-(6)Merger and restructuring charges37335--41237 N/M FDIC insurance expense88121515-18(7)(40)Legal fees1412899216559Advertising expense77778-(2)(1)(10)Other real estate expense35685(2)(45)(2)(33)Litigation and operational losses18536(7)(89)(5)(84)Provision for credit losses on lending-related commitments(1)(3)(2)(3)(3)257266Other noninterest expenses383733364113(3)(7)Total noninterest expenses4784604094154371844110Income before income taxes1291261371381263333Provision for income taxes3328413530521312NET INCOME96989610396(2)(2)--Less:    Income allocated to participating securities11111-(7)-(11)Net income attributable to common shares$      95$      97$      95$    102$      95$        (2)(2)%$            --%Earnings per common share:     Basic$   0.48$   0.51$   0.54$   0.58$   0.54$   (0.03)(6)%$    (0.06)(11)%     Diluted0.480.510.530.570.53(0.03)(6)(0.05)(9)Cash dividends declared on common stock2020181718--212Cash dividends declared per common share0.100.100.100.100.10----N/M - Not meaningfulANALYSIS OF THE ALLOWANCE FOR LOAN LOSSES (unaudited)Comerica Incorporated and Subsidiaries20112010(in millions)4th Qtr3rd Qtr2nd Qtr1st Qtr4th QtrBalance at beginning of period$          767$          806$           849$            901$          957Loan charge-offs:    Commercial2833666543    Real estate construction:        Commercial Real Estate business line (a)41112834        Other business lines (b)1--1-          Total real estate construction51112934    Commercial mortgage:        Commercial Real Estate business line (a)1712899        Other business lines (b)2421232534          Total commercial mortgage4133313443    Residential mortgage24725    Consumer799815    Lease financing-----    International2--5-        Total loan charge-offs8590125123140Recoveries on loans previously charged-off:    Commercial1151347    Real estate construction43523    Commercial mortgage935910    Residential mortgage-11-1    Consumer11112    Lease financing--654    International--41-        Total recoveries2513352227Net loan charge-offs607790101113Provision for loan losses1938474957Balance at end of period$          726$          767$           806$            849$          901Allowance for loan losses as a percentage of total loans (c)1.70%1.86%2.06%2.17%2.24%Net loan charge-offs as a percentage of average total loans0.570.770.921.031.13Net credit-related charge-offs as a percentage of average total loans0.570.770.921.031.13(a) Primarily charge-offs of loans to real estate investors and developers.(b) Primarily charge-offs of loans secured by owner-occupied real estate.(c) Reflects the impact of acquired loans, which were initially recorded at fair value with no related allowance for loan losses.ANALYSIS OF THE ALLOWANCE FOR CREDIT LOSSES ON LENDING-RELATED COMMITMENTS (unaudited)Comerica Incorporated and Subsidiaries20112010(in millions)4th Qtr3rd Qtr2nd Qtr1st Qtr4th QtrBalance at beginning of period$            27$            30$             32$              35$            38Add: Provision for credit losses on lending-related commitments(1)(3)(2)(3)(3)Balance at end of period$            26$            27$             30$              32$            35Unfunded lending-related commitments sold$               -$              -$               3$                2$               -NONPERFORMING ASSETS (unaudited)Comerica Incorporated and Subsidiaries20112010(in millions) 4th Qtr 3rd Qtr 2nd Qtr1st Qtr 4th Qtr SUMMARY OF NONPERFORMING ASSETS AND PAST DUE LOANSNonaccrual loans:Business loans:Commercial$     237$      258$    261$    226$     252Real estate construction:Commercial Real Estate business line (a)93109137195259Other business lines (b)83234Total real estate construction101112139198263Commercial mortgage:Commercial Real Estate business line (a)159198186197181Other business lines (b)268275269293302Total commercial mortgage427473455490483Lease financing55677International87742Total nonaccrual business loans7788558689251,007Retail loans:Residential mortgage7165605855Consumer:Home equity54465Other consumer659713Total consumer 119131318Total nonaccrual retail loans8274737173Total nonaccrual loans8609299419961,080Reduced-rate loans2729333443Total nonperforming loans (c)8879589741,0301,123Foreclosed property94877074112Total nonperforming assets (c)$     981$   1,045$ 1,044$ 1,104$  1,235Nonperforming loans as a percentage of total loans2.08%2.32%2.49%2.63%2.79%Nonperforming assets as a percentage of total loans    and foreclosed property2.292.532.662.813.06Allowance for loan losses as a percentage    of total nonperforming loans         8280838280Loans past due 90 days or more and still accruing$       58$        81$      64$      72$       62ANALYSIS OF NONACCRUAL LOANSNonaccrual loans at beginning of period$     929$      941$    996$ 1,080$  1,163     Loans transferred to nonaccrual (d)99130150149173     Nonaccrual business loan gross charge-offs (e)(76)(76)(109)(111)(120)     Loans transferred to accrual status (d)-(15)-(4)(4)     Nonaccrual business loans sold (f)(19)(15)(9)(60)(41)     Payments/Other (g)(73)(36)(87)(58)(91)Nonaccrual loans at end of period$     860$      929$    941$    996$  1,080(a) Primarily loans to real estate investors and 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 $2 million.(e) Analysis of gross loan charge-offs:      Nonaccrual business loans$       76$        76$    109$    111$     120      Performing watch list loans-1-2-      Consumer and residential mortgage loans913161020Total gross loan charge-offs$       85$        90$    125$    123$     140(f) Analysis of loans sold:      Nonaccrual business loans$       19$        15$        9$      60$       41      Performing watch list loans -1663529Total loans sold$       19$        31$      15$      95$       70(g) Includes net changes related to nonaccrual loans with balances less than $2 million, payments on nonaccrual loans with book balances greater than $2 million and transfers of nonaccrual loans to foreclosed property. Excludes business loan gross charge-offs and business nonaccrual loans sold.ANALYSIS OF NET INTEREST INCOME (FTE)Comerica Incorporated and SubsidiariesYears EndedDecember 31, 2011December 31, 2010AverageAverageAverageAverage(dollar amounts in millions)BalanceInterestRateBalanceInterestRateCommercial loans$   22,208$      8193.69%$   21,090$      8203.89%Real estate construction loans1,843814.372,839903.17Commercial mortgage loans 10,0254244.2310,2444214.10Residential mortgage loans1,580835.271,607855.30Consumer loans2,278803.502,429863.54Lease financing950333.511,086423.88International loans1,191463.831,222483.94Business loan swap income----28-Total loans (a)40,0751,5663.9140,5171,6204.00Auction-rate securities available-for-sale47940.7274581.01Other investment securities available-for-sale7,6922313.066,4192203.51Total investment securities available-for-sale 8,1712352.917,1642283.24Federal funds sold and securities purchased  under agreements to resell5-0.326-0.36Interest-bearing deposits with banks (b)3,74190.243,19180.25Other short-term investments12932.1712621.58Total earning assets52,1211,8133.4951,0041,8583.65Cash and due from banks921825Allowance for loan losses(838)(1,019)Accrued income and other assets4,7134,743Total assets$   56,917$   55,553Money market and NOW deposits$   19,088470.25$   16,355510.31Savings deposits 1,55020.111,39410.08Customer certificates of deposit 5,719390.685,875530.90Total interest-bearing core deposits26,357880.3323,6241050.44Other time deposits23-0.4230693.04Foreign office time deposits38820.4846210.31Total interest-bearing deposits26,768900.3324,3921150.47Short-term borrowings138-0.1321610.25Medium- and long-term debt5,519661.208,684911.05Total interest-bearing sources32,4251560.4833,2922070.62Noninterest-bearing deposits16,99415,094Accrued expenses and other liabilities1,1471,099Total shareholders' equity6,3516,068Total liabilities and shareholders' equity$   56,917$   55,553Net interest income/rate spread (FTE)$   1,6573.01$   1,6513.03FTE adjustment$          4$          5Impact of net noninterest-bearing sources of funds0.180.21Net interest margin (as a percentage  of average earning assets) (FTE) (a) (b)3.19%3.24%(a) Accretion of the purchase discount on the acquired loan portfolio of $53 million increased the net interest margin by 10  basis points in 2011.(b) Excess liquidity, represented by average balances deposited with the Federal Reserve Bank, reduced the net interest margin by 22 basis points and 20 basis points in 2011 and 2010, respectively.ANALYSIS OF NET INTEREST INCOME (FTE)Comerica Incorporated and SubsidiariesThree Months EndedDecember 31, 2011September 30, 2011December 31, 2010AverageAverageAverageAverageAverageAverage(dollar amounts in millions)BalanceInterestRateBalanceInterestRateBalanceInterestRateCommercial loans$   23,515$      2163.64%$   22,127$      2073.70%$   21,464$      2063.80%Real estate construction loans1,619215.261,699235.282,371213.50Commercial mortgage loans 10,3881194.5410,2751154.429,9651003.97Residential mortgage loans1,591205.061,606215.301,600205.11Consumer loans2,294213.582,292203.562,367213.50Lease financing91983.4493683.461,044114.36International loans1,128103.631,163114.011,188113.86Business loan swap income-------4-Total loans (a)41,4544153.9840,0984054.0139,9993943.92Auction-rate securities available-for-sale42610.6443710.6361720.92Other investment securities available-for-sale9,355622.747,721542.876,495483.07Total investment securities available-for-sale 9,781632.648,158552.747,112502.87Federal funds sold and securities purchased  under agreements to resell15-0.32--0.448-0.32Interest-bearing deposits with banks (b)4,29330.244,85130.231,85610.25Other short-term investments13312.2613612.3012711.40Total earning assets55,6764823.4553,2434643.4749,1024463.62Cash and due from banks959969871Allowance for loan losses(773)(814)(979)Accrued income and other assets5,1834,8404,762Total assets$   61,045$   58,238$   53,756Money market and NOW deposits$   20,716$        120.21$   19,595$        130.25$   17,302$        130.29Savings deposits 1,652-0.121,659-0.141,385-0.09Customer certificates of deposit 5,87290.605,878100.665,602110.80Total interest-bearing core deposits28,240210.2927,132230.3324,289240.39Other time deposits14-0.6376-0.38---Foreign office time deposits349-0.3937910.52460-0.45Total interest-bearing deposits28,603210.2927,587240.3324,749240.40Short-term borrowings142-0.07204-0.0817410.27Medium- and long-term debt4,976161.305,168161.236,201151.02Total interest-bearing sources33,721370.4432,959400.4731,124400.52Noninterest-bearing deposits19,17617,51115,607Accrued expenses and other liabilities1,2011,1351,155Total shareholders' equity6,9476,6335,870Total liabilities and shareholders' equity$   61,045$   58,238$   53,756Net interest income/rate spread (FTE)$      4453.01$      4243.00$      4063.10FTE adjustment$          1$          1$          1Impact of net noninterest-bearing sources of funds0.180.180.19Net interest margin (as a percentage  of average earning assets) (FTE) (a) (b)3.19%3.18%3.29%(a) Accretion of the purchase discount on the acquired loan portfolio of $26 million in the fourth quarter and $27 million in the third quarter of 2011 increased the net interest margin by 19 basis points and by 20 basis points in the fourth and third quarters of 2011, respectively.(b) Excess liquidity, represented by average balances deposited with the Federal Reserve Bank, reduced the net interest margin by 24 basis points and by 29 basis points in the fourth and third quarters of 2011, respectively, and by 12 basis points in the fourth quarter of 2010.CONSOLIDATED STATISTICAL DATA (unaudited)Comerica Incorporated and SubsidiariesDecember 31,September 30,June 30,March 31,December 31,(in millions, except per share data)20112011201120112010Commercial loans:     Floor plan$               1,822$                 1,209$      1,478$        1,893$               2,017     Other 23,17421,90420,57419,46720,128Total commercial loans24,99623,11322,05221,36022,145Real estate construction loans:     Commercial Real Estate business line (a)1,1031,2261,3431,6061,826     Other business lines (b)430422385417427Total real estate construction loans1,5331,6481,7282,0232,253Commercial mortgage loans:     Commercial Real Estate business line (a)2,5072,6021,9301,9181,937     Other business lines (b)7,7577,9377,6497,7797,830Total commercial mortgage loans10,26410,5399,5799,6979,767Residential mortgage loans1,5261,6431,4911,5501,619Consumer loans:     Home equity1,6551,6831,6221,6611,704     Other consumer630626610601607Total consumer loans2,2852,3092,2322,2622,311Lease financing9059279499581,009International loans1,1701,0461,1621,3261,132Total loans$             42,679$               41,225$    39,193$      39,176$             40,236Goodwill$                  635$                    635$         150$           150$                  150Core deposit intangible2932---Loan servicing rights33445Tier 1 common capital ratio (c) (d)10.31%10.57%10.53%10.35%10.13%Tier 1 risk-based capital ratio (d)10.3510.6510.5310.3510.13Total risk-based capital ratio (d)14.1814.8414.8014.8014.54Leverage ratio (d)10.9211.4111.4011.3711.26Tangible common equity ratio (c)10.2710.4310.9010.4310.54Book value per common share$               34.80$                 34.94$      34.15$        33.25$               32.82Market value per share for the quarter:     High27.3735.7939.0043.5343.44     Low21.5321.4833.0836.2034.43     Close25.8022.9734.5736.7242.24Quarterly ratios:     Return on average common shareholders' equity5.51%5.91%6.41%7.08%6.53%     Return on average assets0.630.670.700.770.71     Efficiency ratio75.7875.1169.3369.0570.38Number of banking centers494502446445444Number of employees - full time equivalent 9,3979,7018,9158,9559,001(a) Primarily loans to real estate investors and developers.(b) Primarily loans secured by owner-occupied real estate.(c) See Reconciliation of Non-GAAP Financial Measures.(d) December 31, 2011 ratios are estimated.PARENT COMPANY ONLY BALANCE SHEETS (unaudited)Comerica IncorporatedDecember 31,September 30,December 31,(in millions, except share data)2011 2011 2010 ASSETSCash and due from subsidiary bank$                    7$                      3$                      -Short-term investments with subsidiary bank411440327Other short-term investments908686Investment in subsidiaries, principally banks7,0117,0985,957Premises and equipment434Other assets177189181      Total assets$             7,700$               7,819$              6,555LIABILITIES AND SHAREHOLDERS' EQUITYMedium- and long-term debt$                666$                  722$                 635Other liabilities166146127      Total liabilities832868762Common stock - $5 par value:    Authorized - 325,000,000 shares    Issued - 228,164,824 shares at 12/31/11 and 9/30/11, and 203,878,110 shares at 12/31/101,1411,1411,019Capital surplus2,1702,1621,481Accumulated other comprehensive loss(356)(230)(389)Retained earnings5,5465,4715,247Less cost of common stock in treasury -  30,831,076 shares at 12/31/11, 29,238,425 shares at 9/30/11, and 27,342,518    shares at 12/31/10(1,633)(1,593)(1,565)      Total shareholders' equity6,8686,9515,793      Total liabilities and shareholders' equity$             7,700$               7,819$              6,555CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (unaudited)Comerica Incorporated and SubsidiariesAccumulatedCommon StockOtherTotalPreferredShares CapitalComprehensiveRetainedTreasuryShareholders'(in millions, except per share data)Stock Outstanding AmountSurplusLossEarningsStockEquityBALANCE AT DECEMBER 31, 2009$      2,151151.2$      894$     740$               (336)$      5,161$   (1,581)$           7,029Net income-----277-277Other comprehensive loss, net of tax----(53)--(53)Total comprehensive income224Cash dividends declared on preferred stock -----(38)-(38)Cash dividends declared on common stock ($0.25 per share)-----(44)-(44)Purchase of common stock-(0.1)----(4)(4)Issuance of common stock-25.1125724---849Redemption of preferred stock(2,250)------(2,250)Redemption discount accretion on preferred stock94----(94)--Accretion of discount on preferred stock5----(5)--Net issuance of common stock under employee stock plans-0.3-(11)-(10)19(2)Share-based compensation ---32---32Other    ---(4)--1(3)BALANCE AT DECEMBER 31, 2010$             -176.5$   1,019$  1,481$               (389)$      5,247$   (1,565)$           5,793Net income-----393-393Other comprehensive income, net of tax----33--33Total comprehensive income426Cash dividends declared on common stock ($0.40 per share)-----(75)-(75)Purchase of common stock-(4.3)----(116)(116)Acquisition of Sterling Bancshares, Inc.-24.3122681---803Net issuance of common stock under employee stock plans-0.8-(29)-(19)48-Share-based compensation ---37---37BALANCE AT DECEMBER 31, 2011$             -197.3$   1,141$  2,170$               (356)$      5,546$   (1,633)$           6,868BUSINESS SEGMENT FINANCIAL RESULTS (unaudited) Comerica Incorporated and Subsidiaries (dollar amounts in millions)Three Months Ended December 31, 2011Business  BankRetailBankWealthManagementFinanceOtherTotalEarnings summary:Net interest income (expense) (FTE)$         382$       176$               46$       (168)$          9$      445Provision for loan losses(4)1510-(2)19Noninterest income733555163182Noninterest expenses16118283349478Provision (benefit) for income taxes (FTE)9743(60)(10)34Net income (loss)$         201$        10$               5$         (95)$       (25)$        96Net credit-related charge-offs$           32$        16$             12$             -$           -$        60Selected average balances:Assets$    32,150$   6,250$        4,672$   11,926$   6,047$ 61,045Loans31,2575,5714,6183541,454Deposits23,29620,7153,40020016847,779Statistical data:Return on average assets (a)2.50%0.18%0.45% N/M N/M 0.63%Net interest margin (b)4.833.374.00 N/M N/M 3.19Efficiency ratio35.5584.3682.12 N/M N/M 75.78Three Months Ended September 30, 2011Business  BankRetailBankWealthManagementFinanceOtherTotalEarnings summary:Net interest income (expense) (FTE)$         363$      173$             45$       (167)$        10$      424Provision for loan losses20176-(5)38Noninterest income77475625(4)201Noninterest expenses16217478343460Provision (benefit) for income taxes (FTE)79106(54)(12)29Net income (loss)$         179$        19$             11$         (91)$       (20)$        98Net credit-related charge-offs$           40$        28$               9$             -$           -$        77Selected average balances:Assets$    30,608$   5,984$        4,674$   10,177$   6,795$ 58,238Loans29,9555,4834,6522640,098Deposits21,75919,7923,19823611345,098Statistical data:Return on average assets (a)2.34%0.38%0.95% N/M N/M 0.67%Net interest margin (b)4.813.463.85 N/M N/M 3.18Efficiency ratio36.9179.1178.00 N/M N/M 75.11Three Months Ended December 31, 2010Business  BankRetailBankWealthManagementFinanceOtherTotalEarnings summary:Net interest income (expense) (FTE)$         341$      134$             42$       (111)$           -$      406Provision for loan losses82923-(3)57Noninterest income814359239215Noninterest expenses15816993125437Provision (benefit) for income taxes (FTE)82(7)(5)(40)131Net income (loss)$         174$       (14)$            (10)$         (60)$          6$        96Net credit-related charge-offs$           73$        22$             18$             -$           -$      113Selected average balances:Assets$    30,489$   5,647$        4,834$     9,228$   3,558$ 53,756Loans29,9475,1924,820281239,999Deposits19,89217,2712,73031015340,356Statistical data:Return on average assets (a)2.29%(0.32)%(0.82)% N/M N/M 0.71%Net interest margin (b)4.513.073.43 N/M N/M 3.29Efficiency ratio37.2595.1792.86 N/M N/M 70.38(a) Return on average assets is calculated based on the greater of average assets or average liabilities and attributed equity.(b) Net interest margin is calculated based on the greater of average earning assets or average deposits and purchased funds.FTE - Fully Taxable EquivalentN/M - Not MeaningfulMARKET SEGMENT FINANCIAL RESULTS (unaudited) Comerica Incorporated and Subsidiaries (dollar amounts in millions)Three Months Ended December 31, 2011MidwestWesternTexasFloridaOther MarketsInternationalFinance& OtherBusinessesTotalEarnings summary:Net interest income (expense) (FTE)$      201$      170$    158$      11$       46$          18$        (159)$      445Provision for loan losses20(12)84-1(2)19Noninterest income85332647819182Noninterest expenses185109891323752478Provision (benefit) for income taxes (FTE)284132(1)(2)6(70)34Net income (loss)$        53$        65$      55$      (1)$       32$          12$        (120)$        96Net credit-related charge-offs $        32$          5$        4$        7$       10$            2$              -$        60Selected average balances:Assets$ 13,980$ 12,266$ 9,712$ 1,435$  4,011$     1,668$     17,973$ 61,045Loans13,72512,0268,9521,4573,7181,568841,454Deposits19,07613,67110,3334352,4141,48236847,779Statistical data:Return on average assets (a)1.05%1.77%1.92%(0.37)%3.20%2.78% N/M 0.63%Net interest margin (b)4.184.926.072.894.904.42 N/M 3.19Efficiency ratio63.6953.9448.1392.2943.6828.20 N/M 75.78Three Months Ended September 30, 2011MidwestWesternTexasFloridaOther MarketsInternationalFinance& OtherBusinessesTotalEarnings summary:Net interest income (expense) (FTE)$      199$      166$    143$      11$       41$          21$        (157)$      424Provision for loan losses2114(7)2112(5)38Noninterest income963229410921201Noninterest expenses1831058011251046460Provision (benefit) for income taxes (FTE)3229351(8)6(66)29Net income (loss)$        59$        50$      64$        1$       23$          12$        (111)$        98Net credit-related charge-offs (recoveries)$        33$        32$        2$        5$         5$             -$              -$        77Selected average balances:Assets$ 14,123$ 12,110$ 8,510$ 1,450$  3,369$     1,705$     16,972$ 58,239Loans13,87311,8898,1451,4773,0751,631840,098Deposits18,51112,9758,8654042,3911,60334945,098Statistical data:Return on average assets (a)1.21%1.42%2.66%0.29%2.76%2.76% N/M 0.67%Net interest margin (b)4.275.066.402.945.365.00 N/M 3.18Efficiency ratio61.7853.1546.5178.0750.7331.23 N/M 75.11Three Months Ended December 31, 2010MidwestWesternTexasFloridaOther MarketsInternationalFinance& OtherBusinessesTotalEarnings summary:Net interest income (expense) (FTE)$      202$      158$      80$      11$       48$          18$        (111)$      406Provision for loan losses4611154(19)3(3)57Noninterest income993527310932215Noninterest expenses201109679241017437Provision (benefit) for income taxes (FTE)19329-55(39)31Net income (loss)$        35$        41$      16$        1$       48$           9$          (54)$        96Net credit-related charge-offs $        52$        43$        9$        7$         2$            -$              -$      113Selected average balances:Assets$ 14,506$ 12,698$ 6,653$ 1,587$  3,911$    1,615$     12,786$ 53,756Loans14,21912,4976,4351,6123,6511,5454039,999Deposits17,95912,4485,5573752,2421,31246340,356Statistical data:Return on average assets (a)0.72%1.21%0.96%0.13%4.93%2.24% N/M 0.71%Net interest margin (b)4.455.014.912.645.324.38 N/M 3.29Efficiency ratio66.6456.4662.6268.6840.0736.08 N/M 70.38(a) Return on average assets is calculated based on the greater of average assets or average liabilities and attributed equity.(b) Net interest margin is calculated based on the greater of average earning assets or average deposits and purchased funds.FTE - Fully Taxable Equivalent N/M - Not MeaningfulRECONCILIATION OF NON-GAAP FINANCIAL MEASURES (unaudited) Comerica Incorporated and SubsidiariesDecember 31,September 30,June 30,March 31,December 31,(dollar amounts in millions)20112011201120112010Tier 1 Common Capital Ratio:Tier 1 capital (a) (b)$           6,582$            6,560$   6,193$     6,107$           6,027Less:Trust preferred securities2549---Tier 1 common capital (b)$           6,557$            6,511$   6,193$     6,107$           6,027Risk-weighted assets (a) (b)$         63,577$          61,593$ 58,795$   58,998$         59,506Tier 1 capital ratio (b)10.35%10.65%10.53%10.35%10.13%Tier 1 common capital ratio (b)10.3110.5710.5310.3510.13Tangible Common Equity Ratio:Total common shareholders' equity$           6,868$            6,951$   6,038$     5,877$           5,793Less:Goodwill635635150150150Other intangible assets3235456Tangible common equity$           6,201$            6,281$   5,884$     5,722$           5,637Total assets$         61,008$          60,888$ 54,141$   55,017$         53,667Less:Goodwill635635150150150Other intangible assets3235456Tangible assets$         60,341$          60,218$ 53,987$   54,862$         53,511Common equity ratio$           11.26%$            11.42%$   11.15%$     10.68%$           10.80%Tangible common equity ratio 10.2710.4310.9010.4310.54(a) Tier 1 capital and risk-weighted assets as defined by regulation.(b) December 31, 2011 Tier 1 capital and risk-weighted assets are estimated.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 tangible common equity removes preferred stock and the effect of intangible assets from capital and the effect of intangible assets from total assets.  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 IncorporatedFor further information: Media, Wayne J. Mielke, +1-214-462-4463, or Investors, Darlene P. Persons, +1-214-462-6831, or Brittany L. Butler, +1-214-462-6834, all of Comerica Incorporated