Comerica's Q3 Net Income Dips, But YTD Shows Growth Amid Deposit Decline

TL;DR

**Comerica's deposit base is shrinking and credit losses are rising, signaling potential trouble despite a slight YTD earnings bump.**

AI Summary

Comerica Inc. reported a slight decrease in net income for the three months ended September 30, 2025, to $176 million from $184 million in the prior year, a 4.3% decline. However, net income attributable to common shares for the nine months ended September 30, 2025, increased to $527 million from $508 million in 2024, a 3.7% rise. Total assets decreased to $77.376 billion at September 30, 2025, from $79.297 billion at December 31, 2024. Total deposits also saw a decline, falling to $62.596 billion from $63.811 billion over the same period. Net interest income improved to $574 million for the three months ended September 30, 2025, up from $534 million in 2024, a 7.5% increase, driven by a larger decrease in interest expense ($372 million vs. $448 million) than interest income ($946 million vs. $982 million). The provision for credit losses increased significantly to $22 million for the quarter, up from $14 million in the prior year, indicating potential asset quality concerns. The company also issued $392 million in preferred stock during the nine months ended September 30, 2025.

Why It Matters

Comerica's mixed financial results, with a quarterly net income dip but year-to-date growth, signal a complex environment for investors. The decline in total deposits to $62.596 billion from $63.811 billion could indicate competitive pressures or customer shifts, impacting the bank's funding costs and lending capacity. The notable increase in provision for credit losses to $22 million from $14 million suggests potential headwinds in asset quality, which could affect future profitability and investor confidence. For employees, these trends might influence hiring and compensation, while customers could see changes in deposit rates or loan offerings as the bank navigates its balance sheet. The broader market will watch Comerica's ability to manage deposit outflows and credit risk in a competitive banking landscape.

Risk Assessment

Risk Level: medium — The risk level is medium due to a significant increase in the provision for credit losses to $22 million for the three months ended September 30, 2025, compared to $14 million in the prior year, indicating potential asset quality deterioration. Additionally, total deposits decreased by $1.215 billion, from $63.811 billion at December 31, 2024, to $62.596 billion at September 30, 2025, which could impact funding stability and cost of funds.

Analyst Insight

Investors should closely monitor Comerica's future credit loss provisions and deposit trends. The increase in credit loss provisions suggests a need for caution regarding asset quality, while declining deposits could pressure net interest margin. Consider if the current valuation adequately reflects these emerging risks.

Financial Highlights

debt To Equity

N/A

revenue

$1,724M

operating Margin

N/A

total Assets

$77.376B

total Debt

$5.422B

net Income

$527M

eps

N/A

gross Margin

N/A

cash Position

$986M

revenue Growth

+6.7%

Revenue Breakdown

Key Numbers

• $176M — Net Income (Q3 2025) (Decreased from $184 million in Q3 2024)
• $527M — Net Income Attributable to Common Shares (YTD Sep 2025) (Increased from $508 million in YTD Sep 2024)
• $77.376B — Total Assets (Sep 30, 2025) (Decreased from $79.297 billion at Dec 31, 2024)
• $62.596B — Total Deposits (Sep 30, 2025) (Decreased from $63.811 billion at Dec 31, 2024)
• $574M — Net Interest Income (Q3 2025) (Increased from $534 million in Q3 2024)
• $22M — Provision for Credit Losses (Q3 2025) (Increased from $14 million in Q3 2024)
• $392M — Issuance of Preferred Stock (YTD Sep 2025) (New capital raised)
• 127,742,643 — Common Shares Outstanding (Oct 24, 2025) (Current common stock count)

Key Players & Entities

• Comerica Inc. (company) — registrant
• Financial Accounting Standards Board (FASB) (regulator) — issuer of accounting standards
• ASU 2023-09 (regulator) — accounting standard update
• ASU 2024-03 (regulator) — accounting standard update
• ASU 2025-06 (regulator) — accounting standard update
• New York Stock Exchange (regulator) — exchange where common stock is registered
• U.S. Securities and Exchange Commission (regulator) — filing authority
• Comerica Bank Tower (company) — principal executive offices

FAQ

Risk Factors

• Interest Rate Sensitivity [high — financial]: Changes in interest rates can significantly impact net interest income and the fair value of financial instruments. For example, a decrease in interest rates led to a $90 million decrease in interest income from short-term investments year-to-date.
• Credit Risk and Loan Portfolio Quality [medium — financial]: The provision for credit losses increased to $22 million in Q3 2025 from $14 million in Q3 2024, indicating potential concerns about the quality of the loan portfolio. Net loans increased slightly to $50.2 billion.
• Economic Downturn Impact [high — market]: A general economic downturn could lead to increased credit losses, reduced loan demand, and lower noninterest income. The company's commercial and commercial mortgage loan portfolios represent significant portions of its total loans.
• Regulatory Compliance and Capital Requirements [medium — regulatory]: Changes in banking regulations and capital requirements could affect the company's operations and profitability. The issuance of $392 million in preferred stock indicates a need for capital, potentially in response to regulatory or strategic needs.
• Cybersecurity and Data Breaches [high — operational]: As a financial institution, Comerica is a target for cyberattacks. A successful breach could lead to significant financial losses, reputational damage, and regulatory penalties.
• Competition in Banking Sector [medium — market]: The banking industry is highly competitive, with pressure on pricing and service offerings. Comerica faces competition from large national banks, regional banks, and newer fintech companies.
• Liquidity Risk [medium — financial]: While total deposits decreased to $62.596 billion from $63.811 billion, the company's liquidity position appears stable. However, significant deposit outflows could impact its ability to fund operations and meet obligations.
• Fair Value Fluctuations [medium — financial]: The company holds significant investment securities available-for-sale ($14.8 billion) and derivative instruments, whose fair values can fluctuate, impacting comprehensive income. A substantial portion of these are Level 2 assets ($13.5 billion in investment securities).

Industry Context

Comerica operates in the highly competitive U.S. banking sector, facing pressure from large national institutions, regional banks, and agile fintech companies. Key industry trends include rising interest rates impacting net interest margins, increased focus on digital transformation, and evolving regulatory landscapes. The sector is characterized by consolidation and a continuous need for technological investment to maintain market share and customer engagement.

Regulatory Implications

Comerica, like all financial institutions, is subject to stringent regulatory oversight from bodies such as the Federal Reserve and OCC. Evolving capital requirements, liquidity rules, and consumer protection regulations can impact profitability and operational flexibility. The recent increase in the provision for credit losses may attract closer scrutiny regarding asset quality management.

What Investors Should Do

1. Monitor provision for credit losses
2. Analyze net interest income drivers
3. Evaluate total asset and deposit trends
4. Assess impact of preferred stock issuance

Key Dates

• 2025-09-30: Consolidated Balance Sheets and Statements of Comprehensive Income filed — Provides the latest financial position and performance data, showing a decrease in total assets and a mixed performance in net income.
• 2025-09-30: Preferred stock issuance — The company issued $392 million in preferred stock, indicating capital raising activities.
• 2025-09-30: Provision for credit losses increase — The provision for credit losses rose to $22 million for Q3 2025, signaling potential asset quality concerns.
• 2024-12-31: Previous year-end financial data — Serves as a baseline for comparison of current period performance and financial position.

Glossary

Provision for credit losses

An expense set aside by a financial institution to cover potential losses from loans that may not be repaid. (An increase in this provision, as seen in Q3 2025, suggests potential deterioration in loan portfolio quality.)

Net interest income

The difference between the interest income generated by a bank and the interest it pays out to depositors and lenders. (An increase in net interest income, as reported for Q3 2025, is a positive sign for core profitability.)

Preferred stock

A class of ownership in a corporation that has a higher claim on the assets and earnings than common stock. (The issuance of $392 million in preferred stock represents a significant capital raising event for the company.)

Level 1, Level 2, Level 3 assets

A hierarchy used to classify the inputs used in valuation techniques for financial instruments. Level 1 uses quoted prices in active markets, Level 2 uses observable inputs other than Level 1 prices, and Level 3 uses unobservable inputs. (Understanding the classification helps assess the reliability and subjectivity of fair value measurements, particularly for investment securities and derivatives.)

Accumulated other comprehensive loss

A component of shareholders' equity that includes unrealized gains and losses on certain investments and foreign currency translation adjustments. (A significant negative balance in this account, such as the $(2,261) million at Sep 30, 2025, can impact total equity.)

Allowance for loan losses

A contra-asset account that reduces the carrying amount of loans to their estimated net realizable value. (This reserve is directly related to the provision for credit losses and reflects management's assessment of potential loan defaults.)

Year-Over-Year Comparison

Compared to the prior year, Comerica Inc. reported a mixed financial performance. While net income for the nine months increased by 3.7% to $527 million, the third quarter saw a 4.3% decline in net income to $176 million. Net interest income showed a healthy 7.5% increase year-over-year for the quarter, driven by reduced interest expenses. However, total assets and deposits have declined, and the provision for credit losses has significantly increased, signaling potential asset quality concerns that were not as pronounced in the prior period.

Key Financial Figures

• $5 — ange on which registered Common Stock, $5 par value CMA New York Stock Exchange
• $111 million — ( 64 ) ( 64 ) — — ( 64 ) (a) Included $111 million and $158 million of loans recorded at f
• $158 million — ( 64 ) (a) Included $111 million and $158 million of loans recorded at fair value on a no

Filing Documents

• cma-20250930.htm (10-Q) — 4380KB
• a2025q310q_ex311.htm (EX-31.1) — 10KB
• a2025q310q_ex312.htm (EX-31.2) — 10KB
• a2025q310q_ex32.htm (EX-32) — 6KB
• 0000028412-25-000235.txt ( ) — 20555KB
• cma-20250930.xsd (EX-101.SCH) — 76KB
• cma-20250930_cal.xml (EX-101.CAL) — 129KB
• cma-20250930_def.xml (EX-101.DEF) — 444KB
• cma-20250930_lab.xml (EX-101.LAB) — 895KB
• cma-20250930_pre.xml (EX-101.PRE) — 697KB
• cma-20250930_htm.xml (XML) — 5615KB

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION

Financial Statements

ITEM 1. Financial Statements Consolidated Balance Sheets at September 30, 2025 (unaudited) and December 31, 2024 1 Consolidated Statements of Comprehensive Income for the Three and Nine Months Ended September 30, 2025 and 2024 (unaudited) 2 Consolidated Statements of Changes in Shareholders' Equity for the Three and Nine Months Ended September 30, 2025 and 2024 (unaudited) 3 Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2025 and 2024 (unaudited) 4

Notes to Consolidated Financial Statements (unaudited)

Notes to Consolidated Financial Statements (unaudited) 5

Management's Discussion and Analysis of Financial Condition and Results of Operations

ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 39

Quantitative and Qualitative Disclosures about Market Risk

ITEM 3. Quantitative and Qualitative Disclosures about Market Risk 69

Controls and Procedures

ITEM 4. Controls and Procedures 69

OTHER INFORMATION

PART II. OTHER INFORMATION

Legal Proceedings

ITEM 1. Legal Proceedings 69

Risk Factors

ITEM 1A. Risk Factors 69

Unregistered Sales of Equity Securities and Use of Proceeds

ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds 70

Other Information

ITEM 5. Other Information 70

Exhibits

ITEM 6. Exhibits 72 Signature 73 Table of Contents

FINANCIAL INFORMATION

Part I. FINANCIAL INFORMATION

Financial Statements

Item 1. Financial Statements CONSOLIDATED BALANCE SHEETS Comerica Incorporated and Subsidiaries (in millions, except share data) September 30, 2025 December 31, 2024 (unaudited) ASSETS Cash and due from banks $ 986 $ 850 Interest-bearing deposits with banks 4,053 5,954 Other short-term investments 325 375 Investment securities available-for-sale 14,816 15,045 Commercial loans 26,755 26,492 Real estate construction loans 2,849 3,680 Commercial mortgage loans 15,190 14,493 Lease financing 782 722 International loans 1,116 952 Residential mortgage loans 1,938 1,929 Consumer loans 2,256 2,271 Total loans 50,886 50,539 Allowance for loan losses ( 686 ) ( 690 ) Net loans 50,200 49,849 Premises and equipment 432 473 Accrued income and other assets 6,564 6,751 Total assets $ 77,376 $ 79,297 LIABILITIES AND SHAREHOLDERS' EQUITY Noninterest-bearing deposits $ 22,581 $ 24,425 Money market and interest-bearing checking deposits 33,839 32,714 Savings deposits 2,014 2,138 Customer certificates of deposit 3,424 3,450 Other time deposits 707 1,052 Foreign office time deposits 31 32 Total interest-bearing deposits 40,015 39,386 Total deposits 62,596 63,811 Accrued expenses and other liabilities 1,929 2,270 Medium- and long-term debt 5,422 6,673 Total liabilities 69,947 72,754 Preferred stock - no par value: Authorized - 10,000,000 shares Issued and outstanding - 400,000 shares at 9/30/2025 and 4,000 shares at 12/31/2024 392 394 Common stock - $5 par value: Authorized - 325,000,000 shares Issued - 228,164,824 shares 1,141 1,141 Capital surplus 2,197 2,218 Accumulated other comprehensive loss ( 2,261 ) ( 3,161 ) Retained earnings 12,268 12,017 Less cost of common stock in treasury - 100,575,744 shares at 9/30/2025 and 96,755,368 shares at 12/31/2024 ( 6,308 ) ( 6,066 ) Total shareholders' equity 7,429 6,543 Total liabilities and shareholders' equity $ 77,376 $ 79,297 See notes to consolidated financial statements (unaudited).

Notes to Consolidated Financial Statements (unaudited)

Notes to Consolidated Financial Statements (unaudited) Comerica Incorporated and Subsidiaries Assets and Liabilities Recorded at Fair Value on a Recurring Basis The following tables present the recorded amount of assets and liabilities measured at fair value on a recurring basis as of September 30, 2025 and December 31, 2024. (in millions) Total Level 1 Level 2 Level 3 September 30, 2025 Deferred compensation plan assets $ 85 $ 85 $ — $ — Equity securities 48 48 — — Investment securities available-for-sale: U.S. Treasury securities 1,299 1,299 — — Residential mortgage-backed securities (a) 8,677 — 8,677 — Commercial mortgage-backed securities (a) 4,840 — 4,840 — Total investment securities available-for-sale 14,816 1,299 13,517 — Derivative assets: Interest rate contracts 152 — 152 — Energy contracts 513 — 513 — Foreign exchange contracts 35 — 35 — Total derivative assets 700 — 700 — Total assets at fair value $ 15,649 $ 1,432 $ 14,217 $ — Derivative liabilities: Interest rate contracts $ 191 $ — $ 191 $ — Energy contracts 492 — 492 — Foreign exchange contracts 29 — 29 — Other financial derivative liabilities 10 — — 10 Total derivative liabilities 722 — 712 10 Deferred compensation plan liabilities 84 84 — — Total liabilities at fair value $ 806 $ 84 $ 712 $ 10 December 31, 2024 Deferred compensation plan assets $ 89 $ 89 $ — $ — Equity securities 46 46 — — Investment securities available-for-sale: U.S. Treasury securities 1,277 1,277 — — Residential mortgage-backed securities (a) 9,076 — 9,076 — Commercial mortgage-backed securities (a) 4,692 — 4,692 — Total investment securities available-for-sale 15,045 1,277 13,768 — Derivative assets: Interest rate contracts 177 — 177 — Energy contracts 416 — 416 — Foreign exchange contracts 73 — 73 — Total derivative assets 666 — 666 — Total assets at fair value $ 15,846 $ 1,412 $ 14,434 $ — Derivative liabilities: Interest rate contracts $ 335 $ — $ 335 $ — Energy contracts 4

Notes to Consolidated Financial Statements (unaudited)

Notes to Consolidated Financial Statements (unaudited) Comerica Incorporated and Subsidiaries The following table summarizes the changes in Level 3 assets and liabilities measured at fair value on a recurring basis for the three- and nine-month periods ended September 30, 2025 and 2024. Net Realized/Unrealized Losses (Pretax) Recorded in Earnings (a) (in millions) Balance at Beginning of Period Realized Unrealized Balance at End of Period Three Months Ended September 30, 2025 Derivative liabilities: Other financial derivative liabilities $ ( 10 ) $ — $ — $ ( 10 ) Three Months Ended September 30, 2024 Derivative liabilities: Other financial derivative liabilities ( 6 ) — ( 5 ) ( 11 ) Nine Months Ended September 30, 2025 Derivative liabilities: Other financial derivative liabilities ( 6 ) — ( 4 ) ( 10 ) Nine Months Ended September 30, 2024 Derivative liabilities: Other financial derivative liabilities ( 12 ) 6 ( 5 ) ( 11 ) (a) Realized and unrealized gains and losses due to changes in fair value are recorded in other noninterest income on the Consolidated Statements of Comprehensive Income. Assets and Liabilities Recorded at Fair Value on a Nonrecurring Basis The Corporation may be required to record certain assets and liabilities at fair value on a nonrecurring basis. These include assets that are recorded at the lower of cost or fair value and were recognized at fair value since it was less than cost at the end of the period. 7 Table of Contents

Notes to Consolidated Financial Statements (unaudited)

Notes to Consolidated Financial Statements (unaudited) Comerica Incorporated and Subsidiaries The following table presents assets recorded at fair value on a nonrecurring basis at September 30, 2025 and December 31, 2024. No liabilities were recorded at fair value on a nonrecurring basis at September 30, 2025 and December 31, 2024. (in millions) Level 3 September 30, 2025 Loans: Commercial $ 53 Commercial mortgage 42 Residential mortgage 16 Total loans 111 Loans held-for-sale 168 Total assets at fair value $ 279 December 31, 2024 Loans: Commercial $ 69 Commercial mortgage 86 Residential mortgage 3 Total loans 158 Loans held-for-sale 216 Other real estate 3 Total assets at fair value $ 377 Level 3 assets recorded at fair value on a nonrecurring basis at September 30, 2025 and December 31, 2024 included loans with a specific allowance and certain bank property held for sale, both measured based on the fair value of collateral. The unobservable inputs were the additional adjustments applied by management to the appraised values to reflect such factors as non-current appraisals and revisions to estimated time to sell. These adjustments are determined based on qualitative judgments made by management on a case-by-case basis and are not observable inputs, although they are used in the determination of fair value. At September 30, 2025 and December 31, 2024, loans held-for-sale classified as Level 3 represented loans held-for-sale in less liquid markets requiring significant management assumptions when determining fair value. 8 Table of Contents

Notes to Consolidated Financial Statements (unaudited)

Notes to Consolidated Financial Statements (unaudited) Comerica Incorporated and Subsidiaries Estimated Fair Values of Financial Instruments Not Recorded at Fair Value on a Recurring Basis The Corporation typically holds the majority of its financial instruments until maturity and thus does not expect to realize many of the estimated fair value amounts disclosed. The disclosures do not include estimated fair value amounts for items that are not defined as financial instruments, but which have significant value. These include such items as core deposit intangibles, the future earnings potential of significant customer relationships and the value of trust operations and other fee generating businesses. The Corporation believes the imprecision of an estimate could be significant. The disclosures also do not include a limited amount of nonmarketable equity securities (primarily indirect private equity and venture capital investments) that do not have a readily determinable fair value and whose fair values are based on net asset value. The carrying amount and estimated fair value of financial instruments not recorded at fair value in their entirety on a recurring basis on the Corporation's Consolidated Balance Sheets are as follows: Carrying Amount Estimated Fair Value (in millions) Total Level 1 Level 2 Level 3 September 30, 2025 Assets Cash and due from banks $ 986 $ 986 $ 986 $ — $ — Interest-bearing deposits with banks 4,053 4,053 4,053 — — Other short-term investments 20 20 20 — — Total loans, net of allowance for loan losses (a) 50,200 50,136 — — 50,136 Liabilities Demand deposits 58,434 58,434 — 58,434 — Time deposits 4,162 4,165 — 4,165 — Total deposits 62,596 62,599 — 62,599 — Medium- and long-term debt 5,422 5,527 — 5,527 — Credit-related financial instruments ( 65 ) ( 65 ) — — ( 65 ) December 31, 2024 Assets Cash and due from banks $ 850 $ 850 $ 850 $ — $ — Interest-bearing deposits with banks 5,954 5,954 5,954 — — Other short-term

Notes to Consolidated Financial Statements (unaudited)

Notes to Consolidated Financial Statements (unaudited) Comerica Incorporated and Subsidiaries NOTE 3 - INVESTMENT SECURITIES A summary of the Corporation's investment securities follows: (in millions) Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value September 30, 2025 Investment securities available-for-sale: U.S. Treasury securities $ 1,292 $ 7 $ — $ 1,299 Residential mortgage-backed securities (a) 10,524 — 1,847 8,677 Commercial mortgage-backed securities (a) 5,186 — 346 4,840 Total investment securities available-for-sale $ 17,002 $ 7 $ 2,193 $ 14,816 December 31, 2024 Investment securities available-for-sale: U.S. Treasury securities $ 1,277 $ 1 $ 1 $ 1,277 Residential mortgage-backed securities (a) 11,380 — 2,304 9,076 Commercial mortgage-backed securities (a) 5,261 — 569 4,692 Total investment securities available-for-sale $ 17,918 $ 1 $ 2,874 $ 15,045 (a) Issued and/or guaranteed by U.S. government agencies or U.S. government-sponsored enterprises. A summary of the Corporation's investment securities in an unrealized loss position as of September 30, 2025 and December 31, 2024 follows: Less than 12 Months 12 Months or more Total (in millions, except securities count) Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses Count September 30, 2025 U.S. Treasury securities $ 21 $ — $ 102 $ — $ 123 $ — 3 Residential mortgage-backed securities (a) — — 8,656 1,847 8,656 1,847 734 Commercial mortgage-backed securities (a) — — 4,826 346 4,826 346 245 Total temporarily impaired securities $ 21 $ — $ 13,584 $ 2,193 $ 13,605 $ 2,193 982 December 31, 2024 U.S. Treasury securities $ 438 $ — $ 25 $ 1 $ 463 $ 1 7 Residential mortgage-backed securities (a) — — 9,074 2,304 9,074 2,304 913 Commercial mortgage-backed securities (a) 14 — 4,678 569 4,692 569 252 Total temporarily impaired securities $ 452 $ — $ 13,777 $ 2,874 $ 14,229 $ 2,874 1,172 (a) Issued and/or guaranteed by U.S. g

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