This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Comerica Misses, but Loans Grow

  • Third-quarter EPS of 61 cents, missing consensus estimate of 65 cents.
  • Average commercial & industrial loans grow 3% sequentially.
  • Net interest margin continues to narrow, in line with industry.

NEW YORK ( TheStreet) -- Comerica (CMA - Get Report) on Wednesday reported third-quarter net income attributable to common shares of $116 million, or 61 cents, missing the consensus estimate of a 65-cent profit, among analysts polled by Thomson Reuters.

The Dallas lender's earnings declined from $142 million, or 73 cents a share, during the second quarter, with the sequential earnings decline reflecting a $14 million decline in noninterest income "primarily due to decreases in certain non-customer driven income categories," as "net securities gains of $6 million and a $5 million annual incentive bonus received in the second quarter 2012 were not repeated in the third quarter, and net income from principal investing and warrants declined $3 million."

The sequential earnings decline also reflected a $16 million increase in noninterest expenses, to $449 million in the third quarter, mainly from expenses related to the company's acquisition of Sterling Bancshares in July 2011.

Comerica's third-quarter earnings to common shareholders were up 19% from $98 million, or 51 cents a share, in the third quarter of 2011.

Third-quarter net interest income declined to $427 million, from $435 million in the second quarter, although it increased from $423 million in the third quarter of 2011. The net interest margin -- the difference between the average yield on loans and investments and the average cost for deposits and borrowings -- narrowed to 2.96% in the third quarter, from 3.10% the previous quarter, and 3.18% a year earlier.

Most banks are facing pressure on their net interest margins, with the Federal Reserve keeping its target federal funds rate in a range of zero to 0.25% since the end of 2008, while the central bank in September significantly increased its purchases of long-term mortgage-backed securities, in an effort to keep long-term rates at historically low levels.

A bright spot for Comerica -- and another industry trend -- is the continued increase in noninterest bearing deposits, which totaled $21.8 billion as of Sept. 30, increasing 2% from the previous quarter, and 14% year-over-year.

Average loans grew 1% during the second quarter, with average commercial and industrial loans growing 3% sequentially to $26.7 billion, while average commercial mortgage loans declined by 3% to $9.7 billion.
1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
CMA $42.28 0.00%
AAPL $94.19 0.00%
FB $118.06 0.00%
GOOG $695.70 0.00%
TSLA $222.56 0.00%


Chart of I:DJI
DOW 17,651.26 -99.65 -0.56%
S&P 500 2,051.12 -12.25 -0.59%
NASDAQ 4,725.6390 -37.5850 -0.79%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs