Comerica

(CMA) - Get Report

on Wednesday slashed its dividend to 5 cents from 33 cents per common share, in a move expected to preserve $170 million in capital.

The dividend is payable on April 1 to shareholders of record as of March 15. The cut followed the company's 50% reduction of its fourth-quarter dividend.

The cut does not come as a surprise. Comerica was sixth on the list of large, profitable holding companies with the highest dividend payouts, with a payout ratio of 153%, according to Highline Financial.

TheStreet.com

recently noted that many of these banks were ripe for

dividend cuts

.

Comerica's total payout on common shares for all of 2008 was $2.31, or 179% of its $1.29 in earnings per common shares.

Following a continued decline in

Comerica's

earnings, CEO Ralph Babb Jr. expressed confidence that Comerica's credit quality in 2009 would be consistent with 2008, but said "prudence dictates we retain capital in this uncertain economic environment."

Sandler O'Neill analyst R. Scott Siefers said Comerica's move to cut the dividend was "appropriate," since the common stock was yielding 7.6% as of Tuesday's market close, and the company has not been expected to achieve sufficient earnings to cover its 33 cents per share dividend until the first quarter of 2010.

Other holding companies recently cutting dividends include

Zions Bancorp

(ZION) - Get Report

,

Fifth Third

(FITB) - Get Report

,

SunTrust

(STI) - Get Report

and

Marshall & Ilsley

(MI)

.

Comerica shares recently were up 11.2% to $19.26.

Philip W. van Doorn joined TheStreet.com Ratings., Inc., in February 2007. He is the senior analyst responsible for assigning financial strength ratings to banks and savings and loan institutions. He also comments on industry and regulatory trends. Mr. van Doorn has fifteen years experience, having served as a loan operations officer at Riverside National Bank in Fort Pierce, Florida, and as a credit analyst at the Federal Home Loan Bank of New York, where he monitored banks in New York, New Jersey and Puerto Rico. Mr. van Doorn has additional experience in the mutual fund and computer software industries. He holds a Bachelor of Science in business administration from Long Island University.