Comerica Incorporated

Comerica reported second-quarter 2025 earnings per share of $1.42, representing an almost 14% increase over the prior quarter. Net interest income was $575 million, flat for the third consecutive quarter, and management said net interest margin declined modestly by two basis points. Average loans were up almost 1% and period-end loans were up approximately 3%; average deposits declined just over 1%. Non-interest income increased $20 million, while non-interest expense decreased $23 million. Credit quality remained stable, with net charge-offs of 22 basis points, and the allowance coverage ratio remained 1.44%. Management’s 2025 outlook calls for average loans flat to down 1% for the full year, average deposits down 2% to 3%, net interest income growth of 5% to 7% with Q3 expected to be slightly down from Q2 and Q4 improving, non-interest income up 2%, non-interest expense up 2%, net charge-offs at the lower end of the 20 to 40 basis point range, and an approximately 22% tax rate excluding discrete items.

Curt Farmer framed the quarter as evidence of execution and a “loan inflection,” with growth across most businesses, better sentiment, and customers starting to make measured investments again. He emphasized Comerica’s structural tailwinds from swap and securities maturities, improving payments and deposits capabilities, and what he described as strong capital, credit, and liquidity management. His tone was confident but measured, repeatedly pointing to rebuilding, ongoing investment, and a long-term focus on growth and returns.

Jim Herzog highlighted that the bank’s outlook improved, with full-year average loans now expected to be flat to down 1% versus prior guidance, average deposits expected down 2% to 3%, and 2025 NII still targeted to grow 5% to 7%. He said Q3 NII should dip modestly because of preferred stock redemption, higher deposit pay rates, and other one-time factors, before improving in Q4; he also noted the quarter’s 4-basis-point deposit pricing increase and a cumulative beta of 67% since Q3 last year. On capital, he cited estimated CET1 of 11.94%, said the bank redeemed preferred stock, and said buybacks increased to $100 million in Q2 with another $100 million planned for Q3. He also pointed to a lower 2025 tax rate expectation of about 22% excluding discrete items.

Analysts focused on the NII path, expense run-rate, deposit pricing, loan growth durability, and whether Comerica might need to consider M&A or a different strategy to improve performance. Management said Q3 NII will be pressured by preferred stock redemption and deposit pricing resets, but Q4 should improve as those effects fade and loan/deposit growth continues. On expenses, Jim Herzog said the jump implied by guidance reflects the unusually strong Q2, nonrecurring benefits, deferred project spending, seasonality, inflation, and higher strategic investment. In response to questions about independence and acquisitions, Curt Farmer said the bank is focused on organic growth and will consider deals only if they make strong strategic, geographic, and cultural sense.