CMA 10-Q Quarterly Report Sept. 30, 2024

COMERICA INC /NEW/

10-Ks and 10-Qs

10-Q	Quarter ended Sept. 30, 2025
10-Q	Quarter ended June 30, 2025
10-Q	Quarter ended March 31, 2025
10-K	Fiscal year ended Dec. 31, 2024
10-Q	Quarter ended Sept. 30, 2024
10-Q	Quarter ended June 30, 2024
10-Q	Quarter ended March 31, 2024
10-K	Fiscal year ended Dec. 31, 2023
10-Q	Quarter ended Sept. 30, 2023
10-Q	Quarter ended June 30, 2023
10-Q	Quarter ended March 31, 2023
10-K	Fiscal year ended Dec. 31, 2022
10-Q	Quarter ended Sept. 30, 2022
10-Q	Quarter ended June 30, 2022
10-Q	Quarter ended March 31, 2022
10-K	Fiscal year ended Dec. 31, 2021
10-Q	Quarter ended Sept. 30, 2021
10-Q	Quarter ended June 30, 2021
10-Q	Quarter ended March 31, 2021
10-K	Fiscal year ended Dec. 31, 2020
10-Q	Quarter ended Sept. 30, 2020
10-Q	Quarter ended June 30, 2020
10-Q	Quarter ended March 31, 2020
10-K	Fiscal year ended Dec. 31, 2019
10-Q	Quarter ended Sept. 30, 2019
10-Q	Quarter ended June 30, 2019
10-Q	Quarter ended March 31, 2019
10-K	Fiscal year ended Dec. 31, 2018
10-Q	Quarter ended Sept. 30, 2018
10-Q	Quarter ended June 30, 2018
10-Q	Quarter ended March 31, 2018
10-K	Fiscal year ended Dec. 31, 2017
10-Q	Quarter ended Sept. 30, 2017
10-Q	Quarter ended June 30, 2017
10-Q	Quarter ended March 31, 2017
10-K	Fiscal year ended Dec. 31, 2016
10-Q	Quarter ended Sept. 30, 2016
10-Q	Quarter ended June 30, 2016
10-Q	Quarter ended March 31, 2016
10-K	Fiscal year ended Dec. 31, 2015
10-Q	Quarter ended Sept. 30, 2015
10-Q	Quarter ended June 30, 2015
10-Q	Quarter ended March 31, 2015
10-K	Fiscal year ended Dec. 31, 2014
10-Q	Quarter ended Sept. 30, 2014
10-Q	Quarter ended June 30, 2014
10-Q	Quarter ended March 31, 2014
10-K	Fiscal year ended Dec. 31, 2013
10-Q	Quarter ended Sept. 30, 2013
10-Q	Quarter ended June 30, 2013
10-Q	Quarter ended March 31, 2013
10-K	Fiscal year ended Dec. 31, 2012
10-Q	Quarter ended Sept. 30, 2012
10-Q	Quarter ended June 30, 2012
10-Q	Quarter ended March 31, 2012
10-K	Fiscal year ended Dec. 31, 2011
10-Q	Quarter ended Sept. 30, 2011
10-Q	Quarter ended June 30, 2011
10-Q	Quarter ended March 31, 2011
10-K	Fiscal year ended Dec. 31, 2010
10-Q	Quarter ended Sept. 30, 2010
10-Q	Quarter ended June 30, 2010
10-Q	Quarter ended March 31, 2010
10-K	Fiscal year ended Dec. 31, 2009

PROXIES

DEF 14A	Filed on April 29, 2025
DEF 14A	Filed on March 17, 2025
DEF 14A	Filed on March 11, 2024
DEF 14A	Filed on March 13, 2023
DEF 14A	Filed on April 26, 2022
DEF 14A	Filed on March 15, 2022
DEF 14A	Filed on March 16, 2021
DEF 14A	Filed on March 17, 2020
DEF 14A	Filed on March 12, 2019
DEF 14A	Filed on March 13, 2018
DEF 14A	Filed on March 14, 2017
DEF 14A	Filed on March 16, 2016
DEF 14A	Filed on March 17, 2015
DEF 14A	Filed on March 11, 2014
DEF 14A	Filed on March 12, 2013
DEF 14A	Filed on March 16, 2012
DEF 14A	Filed on March 18, 2011
DEF 14A	Filed on March 19, 2010

cma-20240930

Table of Contents

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

______________________________

FORM 10-Q

______________________________

(Mark One)


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2024


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number 1-10706

____________________________________________________________________________________

Comerica Incorporated

(Exact name of registrant as specified in its charter)

___________________________________________________________________________________


Delaware			38-1998421
(State or other jurisdiction of incorporation or organization)			(I.R.S. Employer Identification No.)

Comerica Bank Tower

1717 Main Street, MC 6404

Dallas , Texas 75201

(Address of principal executive offices)

(Zip Code)

(833) 571-0486

(Registrant’s telephone number, including area code)

_________________________________________________________________________

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading symbol	Name of each exchange on which registered
Common Stock, $5 par value	CMA	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ý No o

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ý No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act.


Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date.

$5 par value common stock: Outstanding as of October 24, 2024: 131,514,178 shares

Table of Contents

COMERICA INCORPORATED AND SUBSIDIARIES

TABLE OF CONTENTS


PART I. FINANCIAL INFORMATION

ITEM 1. Financial Statements

Consolidated Balance Sheets at September 30, 2024 (unaudited) and December 31, 2023			1

Consolidated Statements of Comprehensive Income for the Three and Nine Months Ended September 30, 2024 and 2023 (unaudited)			2

Consolidated Statements of Changes in Shareholders’ Equity for the Three and Nine Months Ended September 30, 2024 and 2023 (unaudited)			3

Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2024 and 2023 (unaudited)			4

Notes to Consolidated Financial Statements (unaudited)			5

ITEM 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations			38

ITEM 3. Quantitative and Qualitative Disclosures about Market Risk			66

ITEM 4. Controls and Procedures			66

PART II. OTHER INFORMATION

ITEM 1. Legal Proceedings			66

ITEM 1A. Risk Factors			66

ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds			66

ITEM 5. Other Information			66

ITEM 6. Exhibits			67

Signature			68

Table of Contents

Part I. FINANCIAL INFORMATION

Item 1. Financial Statements

CONSOLIDATED BALANCE SHEETS

Comerica Incorporated and Subsidiaries



(in millions, except share data)	September 30, 2024		December 31, 2023
	(unaudited)
ASSETS
Cash and due from banks	$	870	$	1,443
Interest-bearing deposits with banks	5,523		8,059
Other short-term investments	364		399
Investment securities available-for-sale	15,886		16,869

Commercial loans	25,953		27,251
Real estate construction loans	3,859		5,083
Commercial mortgage loans	14,774		13,686
Lease financing	767		807
International loans	1,003		1,102
Residential mortgage loans	1,901		1,889
Consumer loans	2,260		2,295
Total loans	50,517		52,113
Allowance for loan losses	( 686 )		( 688 )
Net loans	49,831		51,425
Premises and equipment	476		445
Accrued income and other assets	6,713		7,194
Total assets	$	79,663	$	85,834
LIABILITIES AND SHAREHOLDERS’ EQUITY
Noninterest-bearing deposits	$	23,819	$	27,849
Money market and interest-bearing checking deposits	31,469		28,246
Savings deposits	2,155		2,381
Customer certificates of deposit	3,592		3,723
Other time deposits	2,017		4,550
Foreign office time deposits	25		13
Total interest-bearing deposits	39,258		38,913
Total deposits	63,077		66,762
Short-term borrowings	—		3,565
Accrued expenses and other liabilities	2,434		2,895
Medium- and long-term debt	6,786		6,206
Total liabilities	72,297		79,428
Fixed rate reset non-cumulative perpetual preferred stock, series A, no par value, $ 100,000 liquidation preference per share:
Authorized - 4,000 shares
Issued - 4,000 shares	394		394
Common stock - $ 5 par value:
Authorized - 325,000,000 shares
Issued - 228,164,824 shares	1,141		1,141
Capital surplus	2,217		2,224
Accumulated other comprehensive loss	( 2,355 )		( 3,048 )
Retained earnings	11,949		11,727
Less cost of common stock in treasury - 95,441,515 shares at 9/30/2024 and 96,266,568 shares at 12/31/2023	( 5,980 )		( 6,032 )
Total shareholders’ equity	7,366		6,406
Total liabilities and shareholders’ equity	$	79,663	$	85,834

See notes to consolidated financial statements (unaudited).

Table of Contents

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (unaudited)

Comerica Incorporated and Subsidiaries


	Three Months Ended September 30,				Nine Months Ended September 30,

(in millions, except per share data)	2024		2023		2024		2023

INTEREST INCOME
Interest and fees on loans	$	798	$	862	$	2,409	$	2,491
Interest on investment securities	99		105		302		326
Interest on short-term investments	85		136		261		309
Total interest income	982		1,103		2,972		3,126
INTEREST EXPENSE
Interest on deposits	330		271		952		590
Interest on short-term borrowings	1		125		47		333
Interest on medium- and long-term debt	117		106		358		273
Total interest expense	448		502		1,357		1,196
Net interest income	534		601		1,615		1,930
Provision for credit losses	14		14		28		77
Net interest income after provision for credit losses	520		587		1,587		1,853
NONINTEREST INCOME
Card fees	64		71		194		212
Fiduciary income	57		59		166		179
Service charges on deposit accounts	46		47		137		140
Capital markets income	39		35		106		113
Commercial lending fees	17		19		50		55
Brokerage fees	13		6		37		22
Bank-owned life insurance	12		12		33		36
Letter of credit fees	10		10		30		31

Risk management hedging income (loss)	7		17		( 1 )		32
Other noninterest income	12		19		52		60
Total noninterest income	277		295		804		880
NONINTEREST EXPENSES
Salaries and benefits expense	335		315		1,006		947
Outside processing fee expense	69		75		205		207
Software expense	46		44		135		127
Occupancy expense	46		44		134		126
Equipment expense	13		12		38		36
FDIC insurance expense	11		19		66		48
Advertising expense	10		12		30		30
Other noninterest expenses	32		34		106		120
Total noninterest expenses	562		555		1,720		1,641
Income before income taxes	235		327		671		1,092
Provision for income taxes	51		76		143		244
NET INCOME	184		251		528		848
Less:
Income allocated to participating securities	1		1		3		4
Preferred stock dividends	6		6		17		17
Net income attributable to common shares	$	177	$	244	$	508	$	827
Earnings per common share:
Basic	$	1.34	$	1.85	$	3.83	$	6.27
Diluted	1.33		1.84		3.80		6.24
Comprehensive income (loss)	1,292		( 533 )		1,221		50
Cash dividends declared on common stock	94		94		283		282
Cash dividends declared per common share	0.71		0.71		2.13		2.13

See notes to consolidated financial statements (unaudited).

Table of Contents

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY (unaudited)

Comerica Incorporated and Subsidiaries


								Accumulated Other Comprehensive Loss
	Nonredeemable Preferred Stock		Common Stock											Total Shareholders' Equity
			Shares Outstanding			Capital Surplus				Retained Earnings		Treasury Stock
(in millions, except per share data)				Amount
BALANCE AT JUNE 30, 2023	$	394	131.7	$	1,141	$	2,212	$	( 3,756 )	$	11,648	$	( 6,044 )	$	5,595

Net income	—		—	—		—		—		251		—		251
Other comprehensive loss, net of tax	—		—	—		—		( 784 )		—		—		( 784 )
Cash dividends declared on common stock ($ 0.71 per share)	—		—	—		—		—		( 94 )		—		( 94 )
Cash dividends declared on preferred stock	—		—	—		—		—		( 6 )		—		( 6 )


Net issuance of common stock under employee stock plans	—		0.1	—		( 1 )		—		( 3 )		5		1

Share-based compensation	—		—	—		9		—		—		—		9

BALANCE AT SEPTEMBER 30, 2023	$	394	131.8	$	1,141	$	2,220	$	( 4,540 )	$	11,796	$	( 6,039 )	$	4,972
BALANCE AT JUNE 30, 2024	$	394	132.6	$	1,141	$	2,210	$	( 3,463 )	$	11,867	$	( 5,988 )	$	6,161
Net income	—		—	—		—		—		184		—		184
Other comprehensive income, net of tax	—		—	—		—		1,108		—		—		1,108
Cash dividends declared on common stock ($ 0.71 per share)	—		—	—		—		—		( 94 )		—		( 94 )
Cash dividends declared on preferred stock	—		—	—		—		—		( 6 )		—		( 6 )


Net issuance of common stock under employee stock plans	—		0.1	—		( 2 )		—		( 2 )		8		4
Share-based compensation	—		—	—		9		—		—		—		9

BALANCE AT SEPTEMBER 30, 2024	$	394	132.7	$	1,141	$	2,217	$	( 2,355 )	$	11,949	$	( 5,980 )	$	7,366
BALANCE AT DECEMBER 31, 2022	$	394	131.0	$	1,141	$	2,220	$	( 3,742 )	$	11,258	$	( 6,090 )	$	5,181

Net income	—		—	—		—		—		848		—		848
Other comprehensive loss, net of tax	—		—	—		—		( 798 )		—		—		( 798 )
Cash dividends declared on common stock ($ 2.13 per share)	—		—	—		—		—		( 282 )		—		( 282 )
Cash dividends declared on preferred stock	—		—	—		—		—		( 17 )		—		( 17 )



Net issuance of common stock under employee stock plans	—		0.8	—		( 44 )		—		( 11 )		51		( 4 )

Share-based compensation	—		—	—		44		—		—		—		44

BALANCE AT SEPTEMBER 30, 2023	$	394	131.8	$	1,141	$	2,220	$	( 4,540 )	$	11,796	$	( 6,039 )	$	4,972
BALANCE AT DECEMBER 31, 2023	$	394	131.9	$	1,141	$	2,224	$	( 3,048 )	$	11,727	$	( 6,032 )	$	6,406
Cumulative effect of change in accounting principle (a)	—		—	—		—		—		( 4 )		—		( 4 )
Net income	—		—	—		—		—		528		—		528
Other comprehensive income, net of tax	—		—	—		—		693		—		—		693
Cash dividends declared on common stock ($ 2.13 per share)	—		—	—		—		—		( 283 )		—		( 283 )
Cash dividends declared on preferred stock	—		—	—		—		—		( 17 )		—		( 17 )


Net issuance of common stock under employee stock plans	—		0.8	—		( 52 )		—		( 2 )		52		( 2 )

Share-based compensation	—		—	—		45		—		—		—		45

BALANCE AT SEPTEMBER 30, 2024	$	394	132.7	$	1,141	$	2,217	$	( 2,355 )	$	11,949	$	( 5,980 )	$	7,366

See notes to consolidated financial statements (unaudited).

(a) Effective January 1, 2024, the Corporation adopted ASU 2023-02, which expanded the permitted use of the proportional amortization method to certain tax credit investments.

Table of Contents

CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited)

Comerica Incorporated and Subsidiaries


	Nine Months Ended September 30,

(in millions)	2024		2023

OPERATING ACTIVITIES
Net income	$	528	$	848
Adjustments to reconcile net income to net cash provided by operating activities:
Provision for credit losses	28		77
Provision (benefit) for deferred income taxes	13		( 25 )
Depreciation and amortization	70		64
Net periodic defined benefit credit	( 36 )		( 20 )
Share-based compensation expense	45		44
Net amortization of securities	8		15


Net gains on sales of foreclosed property and other bank property	—		( 22 )


Net change in:

Accrued income receivable	55		( 70 )
Accrued expenses payable	( 188 )		134
Other, net	432		( 916 )
Net cash provided by operating activities	955		129
INVESTING ACTIVITIES
Investment securities available-for-sale:
Maturities and redemptions	1,524		2,061

Purchases	( 130 )		—



Net change in loans	1,561		( 15 )
Proceeds from sales of foreclosed property and other bank property	—		27
Net increase in premises and equipment	( 118 )		( 93 )

Federal Home Loan Bank stock:
Purchases	( 551 )		( 504 )
Redemptions	697		274

Proceeds from bank-owned life insurance settlements	26		27
Other, net	( 1 )		2
Net cash provided by investing activities	3,008		1,779
FINANCING ACTIVITIES
Net change in:
Deposits	( 3,705 )		( 4,529 )
Short-term borrowings	( 3,565 )		1,601
Medium- and long-term debt:
Maturities and redemptions	( 500 )		( 850 )
Issuances and advances	1,000		4,000



Cash dividends paid on preferred stock	( 17 )		( 17 )
Common stock:
Stock tendered for payment of withholding taxes	( 13 )		( 16 )
Cash dividends paid	( 278 )		( 274 )
Issuances under employee stock plans	5		9




Other, net	1		( 2 )
Net cash used in financing activities	( 7,072 )		( 78 )
Net (decrease) increase in cash and cash equivalents	( 3,109 )		1,830
Cash and cash equivalents at beginning of period	9,502		6,282
Cash and cash equivalents at end of period	$	6,393	$	8,112
Interest paid	$	1,489	$	1,005
Income taxes paid	77		255

See notes to consolidated financial statements (unaudited).

NOTE 1 - BASIS OF PRESENTATION AND ACCOUNTING POLICIES

Organization

The accompanying unaudited consolidated financial statements were prepared in accordance with United States (U.S.) generally accepted accounting principles (GAAP) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, the statements do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation were included. The results of operations for the three and nine months ended September 30, 2024 are not necessarily indicative of the results that may be expected for the year ending December 31, 2024. Certain items in prior periods were reclassified to conform to the current presentation. The accompanying unaudited financial statements should be read in conjunction with the consolidated financial statements and footnotes included in the Annual Report on Form 10-K of Comerica Incorporated and Subsidiaries (the Corporation) for the year ended December 31, 2023 (2023 Annual Report).

Accounting Pronouncements Recently Adopted

Effective January 1, 2024, the Corporation adopted the provisions of Financial Accounting Standards Board (FASB) Accounting Standards Update (ASU) No. 2023-02, "Investments-Equity Method and Joint Ventures (Topic 323): Accounting for Investments in Tax Credit Structures Using the Proportional Amortization Method (a consensus of the Emerging Issues Task Force)" (ASU 2023-02). ASU 2023-02 expanded the permitted use of the proportional amortization method, which was previously only available to low-income housing tax credit investments, to other tax equity investments if certain conditions are met. Under the proportional amortization method, the initial cost of an investment is amortized in proportion to the income tax benefits received and both the amortization of the investment and the income tax benefits received are recognized as a component of income tax expense. ASU 2023-02 was adopted on a modified retrospective basis of transition or, for certain changes, a prospective basis and resulted in a reduction to retained earnings as of January 1, 2024 of $ 4 million.

Recently Issued Accounting Pronouncements

In November 2023, the FASB issued ASU No. 2023-07 "Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures" (ASU 2023-07). The update requires enhanced disclosures about significant segment expenses, enhanced interim disclosure requirements, clarification for when multiple segment measures of profit or loss can be disclosed and other requirements intended to improve overall reportable segment disclosures in annual and interim periods. ASU 2023-07 is effective for the Corporation in the annual period beginning on January 1, 2024 and interim periods beginning on January 1, 2025 with retrospective application to all prior periods presented. Early adoption is permitted. The Corporation will provide the enhanced disclosures, including expanded expense categories by segment, beginning with the Annual Report on Form 10-K for the year ended December 31, 2024.

In December 2023, the FASB issued ASU No. 2023-09 "Income Taxes (Topic 740): Improvements to Income Tax Disclosures" (ASU 2023-09). ASU 2023-09 requires additional annual disclosures including further disaggregation of information in the rate reconciliation, additional information for reconciling items meeting a quantitative threshold, further disaggregation of income taxes paid and other required disclosures. ASU 2023-09 is effective for the Corporation in the annual period beginning on January 1, 2025 and applied on a prospective basis with both early adoption and retrospective application permitted. The Corporation is evaluating the impact of ASU 2023-09 on its income tax disclosures.

NOTE 2 – FAIR VALUE MEASUREMENTS

The Corporation utilizes fair value measurements to record fair value adjustments to certain assets and liabilities and to determine fair value disclosures. The determination of fair values of financial instruments often requires the use of estimates. In cases where quoted market values in an active market are not available, the Corporation uses present value techniques and other valuation methods to estimate the fair values of its financial instruments. These valuation methods require considerable judgment and the resulting estimates of fair value can be significantly affected by the assumptions made and methods used.

Investment securities available-for-sale, derivatives, deferred compensation plans and equity securities with readily determinable fair values (primarily money market mutual funds) are recorded at fair value on a recurring basis. Additionally, from time to time, the Corporation may be required to record other assets and liabilities at fair value on a nonrecurring basis, such as impaired loans, loans held for sale, other real estate (primarily foreclosed property), nonmarketable equity securities and certain other assets and liabilities. These nonrecurring fair value adjustments typically involve write-downs of individual assets or application of lower of cost or fair value accounting.

Table of Contents

Notes to Consolidated Financial Statements (unaudited)

Comerica Incorporated and Subsidiaries

Refer to Note 1 to the consolidated financial statements in the Corporation's 2023 Annual Report for further information about the fair value hierarchy, descriptions of the valuation methodologies and key inputs used to measure financial assets and liabilities recorded at fair value, as well as a description of the methods and significant assumptions used to estimate fair value disclosures for financial instruments not recorded at fair value in their entirety on a recurring basis.

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, 2024 and December 31, 2023.


(in millions)	Total		Level 1		Level 2		Level 3
September 30, 2024

Deferred compensation plan assets	$	91	$	91	$	—	$	—
Equity securities	47		47		—		—


Investment securities available-for-sale:
U.S. Treasury securities	1,169		1,169		—		—
Residential mortgage-backed securities (a)	9,825		—		9,825		—
Commercial mortgage-backed securities (a)	4,892		—		4,892		—



Total investment securities available-for-sale	15,886		1,169		14,717		—
Derivative assets:
Interest rate contracts	197		—		197		—
Energy contracts	593		—		593		—
Foreign exchange contracts	42		—		42		—
Total derivative assets	832		—		832		—
Total assets at fair value	$	16,856	$	1,307	$	15,549	$	—
Derivative liabilities:
Interest rate contracts	$	340	$	—	$	340	$	—
Energy contracts	572		—		572		—
Foreign exchange contracts	37		—		37		—
Other financial derivative liabilities	11		—		—		11
Total derivative liabilities	960		—		949		11
Deferred compensation plan liabilities	91		91		—		—
Total liabilities at fair value	$	1,051	$	91	$	949	$	11
December 31, 2023
Deferred compensation plan assets	$	104	$	104	$	—	$	—
Equity securities	39		39		—		—

Investment securities available-for-sale:
U.S. Treasury securities	1,605		1,605		—		—
Residential mortgage-backed securities (a)	10,519		—		10,519		—



Commercial mortgage-backed securities (a)	4,745		—		4,745		—
Total investment securities available-for-sale	16,869		1,605		15,264		—
Derivative assets:
Interest rate contracts	225		—		225		—
Energy contracts	758		—		758		—
Foreign exchange contracts	36		—		36		—

Total derivative assets	1,019		—		1,019		—
Total assets at fair value	$	18,031	$	1,748	$	16,283	$	—
Derivative liabilities:
Interest rate contracts	$	435	$	—	$	435	$	—
Energy contracts	736		—		736		—
Foreign exchange contracts	35		—		35		—
Other financial derivative liabilities	12		—		—		12
Total derivative liabilities	1,218		—		1,206		12
Deferred compensation plan liabilities	104		104		—		—
Total liabilities at fair value	$	1,322	$	104	$	1,206	$	12

(a) Issued and/or guaranteed by U.S. government agencies or U.S. government-sponsored enterprises.

Table of Contents

Notes to Consolidated Financial Statements (unaudited)

Comerica Incorporated and Subsidiaries

There were no transfers of assets or liabilities recorded at fair value on a recurring basis into or out of Level 3 fair value measurements during the three- and nine-month periods ended September 30, 2024 and 2023.

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, 2024 and 2023.


			Net Realized/Unrealized Gains (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, 2024









Derivative liabilities:
Other financial derivative liabilities	$	( 6 )	$	—	$	( 5 )	$	( 11 )
Three Months Ended September 30, 2023








Derivative liabilities:
Other financial derivative liabilities	( 14 )		—		1				( 13 )

Nine Months Ended September 30, 2024








Derivative liabilities:
Other financial derivative liabilities	( 12 )		6		( 5 )				( 11 )

Nine Months Ended September 30, 2023








Derivative liabilities:
Other financial derivative liabilities	( 12 )		—		( 1 )				( 13 )

(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.

Table of Contents

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, 2024 and December 31, 2023. No liabilities were recorded at fair value on a nonrecurring basis at September 30, 2024 and December 31, 2023.


(in millions)	Level 3
September 30, 2024


Loans:
Commercial	$	41

Commercial mortgage	60


Residential mortgage	4

Total loans	105

Loans held-for-sale	202
Other real estate	7
Total assets at fair value	$	314
December 31, 2023


Loans:
Commercial	$	12

Commercial mortgage	16

International	16
Total loans	44
Loans held-for-sale	231
Other real estate	5
Total assets at fair value	$	280

Level 3 assets recorded at fair value on a nonrecurring basis at September 30, 2024 and December 31, 2023 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, 2024 and December 31, 2023, 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.

Table of Contents

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, 2024
Assets
Cash and due from banks	$	870	$	870	$	870	$	—	$	—
Interest-bearing deposits with banks	5,523		5,523		5,523		—		—
Other short-term investments	21		21		21		—		—
Total loans, net of allowance for loan losses (a)	49,831		50,043		—		—		50,043
Liabilities
Demand deposits	57,443		57,443		—		57,443		—
Time deposits	5,634		5,673		—		5,673		—
Total deposits	63,077		63,116		—		63,116		—

Medium- and long-term debt	6,786		6,867		—		6,867		—
Credit-related financial instruments	( 66 )		( 66 )		—		—		( 66 )
December 31, 2023
Assets
Cash and due from banks	$	1,443	$	1,443	$	1,443	$	—	$	—
Interest-bearing deposits with banks	8,059		8,059		8,059		—		—
Other short-term investments	24		24		24		—		—
Total loans, net of allowance for loan losses (a)	51,425		50,633		—		—		50,633
Liabilities
Demand deposits	58,476		58,476		—		58,476		—
Time deposits	8,286		8,391		—		8,391		—
Total deposits	66,762		66,867		—		66,867		—
Short-term borrowings	3,565		3,565		3,565		—		—
Medium- and long-term debt	6,206		6,207		—		6,207		—
Credit-related financial instruments	( 72 )		( 72 )		—		—		( 72 )

(a) Included $ 105 million and $ 44 million of loans recorded at fair value on a nonrecurring basis at September 30, 2024 and December 31, 2023, respectively.

Table of Contents

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, 2024
Investment securities available-for-sale:
U.S. Treasury securities	$	1,197	$	—	$	28	$	1,169
Residential mortgage-backed securities (a)	11,677		—		1,852		9,825
Commercial mortgage-backed securities (a)	5,265		—		373		4,892



Total investment securities available-for-sale	$	18,139	$	—	$	2,253	$	15,886


December 31, 2023
Investment securities available-for-sale:
U.S. Treasury securities	$	1,681	$	—	$	76	$	1,605
Residential mortgage-backed securities (a)	12,607		—		2,088		10,519
Commercial mortgage-backed securities (a)	5,253		—		508		4,745



Total investment securities available-for-sale	$	19,541	$	—	$	2,672	$	16,869

(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, 2024 and December 31, 2023 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, 2024
U.S. Treasury securities	$	—	$	—	$	1,086	$	28	$	1,086	$	28	13
Residential mortgage-backed securities (a)	1		—		9,822		1,852		9,823		1,852		929
Commercial mortgage-backed securities (a)	—		—		4,878		373		4,878		373		252
Total temporarily impaired securities	$	1	$	—	$	15,786	$	2,253	$	15,787	$	2,253	1,194
December 31, 2023
U.S. Treasury securities	$	—	$	—	$	1,605	$	76	$	1,605	$	76	19
Residential mortgage-backed securities (a)	10		—		10,507		2,088		10,517		2,088		978
Commercial mortgage-backed securities (a)	—		—		4,745		508		4,745		508		253
Total temporarily impaired securities	$	10	$	—	$	16,857	$	2,672	$	16,867	$	2,672	1,250

(a) Issued and/or guaranteed by U.S. government agencies or U.S. government-sponsored enterprises.

Unrealized losses on investment securities resulted from changes in market interest rates. The Corporation’s portfolio is comprised of securities issued or guaranteed by U.S. government agencies or government-sponsored enterprises. As such, it is expected that the securities would not be settled at a price less than the amortized cost of the investments. Further, the Corporation does not intend to sell the investments, and it is not more-likely-than-not that it will be required to sell the investments before recovery of amortized costs. No allowance for credit losses was recorded on securities in an unrealized loss position at September 30, 2024 or December 31, 2023.

Interest receivable on investment securities totaled $ 36 million at September 30, 2024 and $ 40 million at December 31, 2023 and was included in accrued income and other assets on the Consolidated Balance Sheets. The investment securities portfolio included floating-rate securities with a fair value of $ 3 million and $ 4 million at September 30, 2024 and December 31, 2023, respectively.

There were no sales, calls or write-downs of investment securities available-for-sale during the three- and nine-month periods ended September 30, 2024 or September 30, 2023.

Table of Contents

Notes to Consolidated Financial Statements (unaudited)

Comerica Incorporated and Subsidiaries

The following table summarizes the amortized cost and fair values of investment securities by contractual maturity. Securities with multiple maturity dates are classified in the period of final maturity. The actual cash flows of mortgage-backed securities may differ as borrowers of the underlying loans may exercise prepayment options. Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.



(in millions)
September 30, 2024	Amortized Cost		Fair Value
Contractual maturity
One year or less	$	992	$	972
After one year through five years	553		531
After five years through ten years	5,149		4,783
After ten years	11,445		9,600


Total investment securities	$	18,139	$	15,886

At September 30, 2024, investment securities with a carrying value of $ 7.3 billion were pledged where permitted or required by law. Pledges included $ 6.4 billion to the Federal Home Loan Bank (FHLB) as collateral for current advances and potential future borrowings as well as $ 924 million to secure $ 375 million of liabilities, consisting of trust deposits, deposits of public entities and state and local government agencies as well as derivative instruments. For information on FHLB borrowings, refer to Note 8.

Table of Contents

Notes to Consolidated Financial Statements (unaudited)

Comerica Incorporated and Subsidiaries

NOTE 4 – CREDIT QUALITY AND ALLOWANCE FOR CREDIT LOSSES

The following table presents an aging analysis of the amortized cost basis of loans.


	Loans Past Due and Still Accruing
(in millions)	30-59 Days		60-89 Days		90 Days or More		Total		Nonaccrual Loans		Current Loans		Total Loans
September 30, 2024
Business loans:
Commercial	$	24	$	44	$	14	$	82	$	97	$	25,774	$	25,953
Real estate construction:
Commercial Real Estate business line (a)	—		—		—		—		—		3,571		3,571
Other business lines (b)	4		—		—		4		—		284		288
Total real estate construction	4		—		—		4		—		3,855		3,859
Commercial mortgage:
Commercial Real Estate business line (a)	6		—		—		6		18		6,172		6,196
Other business lines (b)	32		6		7		45		70		8,463		8,578
Total commercial mortgage	38		6		7		51		88		14,635		14,774
Lease financing	5		—		—		5		1		761		767
International	—		—		—		—		3		1,000		1,003
Total business loans	71		50		21		142		189		46,025		46,356
Retail loans:
Residential mortgage	11		3		—		14		36		1,851		1,901
Consumer:
Home equity	8		2		—		10		25		1,759		1,794
Other consumer	2		—		—		2		—		464		466
Total consumer	10		2		—		12		25		2,223		2,260
Total retail loans	21		5		—		26		61		4,074		4,161
Total loans	$	92	$	55	$	21	$	168	$	250	$	50,099	$	50,517
December 31, 2023
Business loans:
Commercial	$	48	$	14	$	10	$	72	$	75	$	27,104	$	27,251
Real estate construction:
Commercial Real Estate business line (a)	—		—		—		—		—		4,570		4,570
Other business lines (b)	3		—		—		3		2		508		513
Total real estate construction	3		—		—		3		2		5,078		5,083
Commercial mortgage:
Commercial Real Estate business line (a)	5		—		—		5		18		4,704		4,727
Other business lines (b)	49		12		9		70		23		8,866		8,959
Total commercial mortgage	54		12		9		75		41		13,570		13,686
Lease financing	4		—		—		4		—		803		807
International	—		—		1		1		20		1,081		1,102
Total business loans	109		26		20		155		138		47,636		47,929
Retail loans:
Residential mortgage	10		6		—		16		19		1,854		1,889
Consumer:
Home equity	11		5		—		16		21		1,755		1,792
Other consumer	31		—		—		31		—		472		503
Total consumer	42		5		—		47		21		2,227		2,295
Total retail loans	52		11		—		63		40		4,081		4,184
Total loans	$	161	$	37	$	20	$	218	$	178	$	51,717	$	52,113

(a) Primarily loans to real estate developers.

(b) Primarily loans secured by owner-occupied real estate.

Table of Contents

Notes to Consolidated Financial Statements (unaudited)

Comerica Incorporated and Subsidiaries

The following table presents loans by credit quality indicator and vintage year. Credit quality indicator is based on internal risk ratings assigned to each business loan at the time of approval and subjected to subsequent reviews, generally at least annually, and to pools of retail loans with similar risk characteristics. Vintage year is the year of origination or major modification.


September 30, 2024	Vintage Year
(in millions)	2024		2023		2022		2021		2020		Prior		Revolvers		Revolvers Converted to Term		Total
Business loans:
Commercial
Pass (a)	$	2,365	$	2,327	$	2,067	$	1,223	$	453	$	1,239	$	14,934	$	16	$	24,624


Criticized (b)	59		116		201		217		32		74		629		1		1,329

Total commercial	2,424		2,443		2,268		1,440		485		1,313		15,563		17		25,953
Commercial gross charge-offs	1		1		7		18		9		8		5		1		50
Real estate construction
Pass (a)	104		661		2,005		730		39		26		256		—		3,821


Criticized (b)	—		—		36		—		—		2		—		—		38

Total real estate construction	104		661		2,041		730		39		28		256		—		3,859

Commercial mortgage
Pass (a)	1,014		1,613		3,481		2,726		1,505		2,677		810		—		13,826


Criticized (b)	76		185		262		66		54		287		18		—		948

Total commercial mortgage	1,090		1,798		3,743		2,792		1,559		2,964		828		—		14,774
Commercial mortgage gross charge-offs	—		—		11		—		—		5		—		—		16
Lease financing
Pass (a)	221		228		91		92		34		91		—		—		757


Criticized (b)	2		5		1		—		—		2		—		—		10

Total lease financing	223		233		92		92		34		93		—		—		767
Lease financing gross charge-offs	1		—		3		—		—		—		—		—		4
International
Pass (a)	211		104		140		64		24		28		413		—		984


Criticized (b)	7		2		2		6		—		1		1		—		19

Total international	218		106		142		70		24		29		414		—		1,003
International gross charge-offs	1		—		—		—		—		—		—		—		1
Total business loans	4,059		5,241		8,286		5,124		2,141		4,427		17,061		17		46,356





Retail loans:
Residential mortgage
Pass (a)	120		240		281		360		426		436		—		—		1,863


Criticized (b)	4		1		1		2		—		30		—		—		38

Total residential mortgage	124		241		282		362		426		466		—		—		1,901

Consumer:
Home equity
Pass (a)	—		—		—		—		—		6		1,680		76		1,762


Criticized (b)	—		—		—		—		—		—		26		6		32

Total home equity	—		—		—		—		—		6		1,706		82		1,794

Other consumer
Pass (a)	25		12		28		16		7		49		326		—		463


Criticized (b)	—		—		2		—		—		—		1		—		3

Total other consumer	25		12		30		16		7		49		327		—		466
Other consumer gross charge-offs	—		—		—		—		—		1		—		—		1
Total consumer	25		12		30		16		7		55		2,033		82		2,260
Total retail loans	149		253		312		378		433		521		2,033		82		4,161
Total loans	$	4,208	$	5,494	$	8,598	$	5,502	$	2,574	$	4,948	$	19,094	$	99	$	50,517


Table continues on the following page.

Table of Contents

Notes to Consolidated Financial Statements (unaudited)

Comerica Incorporated and Subsidiaries


December 31, 2023	Vintage Year
	2023		2022		2021		2020		2019		Prior		Revolvers		Revolvers Converted to Term		Total
Business loans:
Commercial
Pass (a)	$	3,105	$	3,013	$	2,072	$	593	$	610	$	1,033	$	15,394	$	13	$	25,833



Criticized (b)	85		169		226		42		59		75		760		2		1,418
Total commercial	3,190		3,182		2,298		635		669		1,108		16,154		15		27,251
Commercial gross charge-offs	1		11		2		1		11		12		3		1		42
Real estate construction
Pass (a)	503		2,205		1,581		329		43		36		288		—		4,985



Criticized (b)	2		53		34		2		7		—		—		—		98
Total real estate construction	505		2,258		1,615		331		50		36		288		—		5,083

Commercial mortgage
Pass (a)	1,680		3,129		2,173		1,786		981		2,271		893		—		12,913



Criticized (b)	15		232		99		34		248		141		4		—		773
Total commercial mortgage	1,695		3,361		2,272		1,820		1,229		2,412		897		—		13,686
Commercial mortgage gross charge-offs	—		—		—		—		3		1		—		—		4
Lease financing
Pass (a)	173		319		110		47		34		94		—		—		777



Criticized (b)	5		8		3		3		7		4		—		—		30
Total lease financing	178		327		113		50		41		98		—		—		807

International
Pass (a)	286		168		89		35		76		2		415		—		1,071



Criticized (b)	15		2		7		—		—		6		1		—		31
Total international	301		170		96		35		76		8		416		—		1,102
International gross charge-offs	12		—		—		—		—		1		—		—		13
Total business loans	5,869		9,298		6,394		2,871		2,065		3,662		17,755		15		47,929
Retail loans:
Residential mortgage
Pass (a)	254		296		373		450		131		360		—		—		1,864



Criticized (b)	2		—		1		—		—		22		—		—		25
Total residential mortgage	256		296		374		450		131		382		—		—		1,889

Consumer:
Home equity
Pass (a)	—		—		—		—		—		8		1,695		59		1,762



Criticized (b)	—		—		—		—		—		—		28		2		30
Total home equity	—		—		—		—		—		8		1,723		61		1,792
Home equity gross charge-offs	—		—		—		—		—		—		2		—		2
Other consumer
Pass (a)	23		38		22		8		4		46		362		—		503




Total other consumer	23		38		22		8		4		46		362		—		503
Other consumer gross charge-offs	—		—		—		—		1		—		—		—		1
Total consumer	23		38		22		8		4		54		2,085		61		2,295
Total retail loans	279		334		396		458		135		436		2,085		61		4,184
Total loans	$	6,148	$	9,632	$	6,790	$	3,329	$	2,200	$	4,098	$	19,840	$	76	$	52,113

(a) Includes all loans not included in the categories of special mention, substandard or nonaccrual.

(b) Includes loans with an internal rating of special mention, substandard loans for which the accrual of interest has not been discontinued and nonaccrual loans. Special mention loans have potential credit weaknesses that deserve management’s close attention, such as loans to borrowers who may be experiencing financial difficulties that may result in deterioration of repayment prospects from the borrower at some future date. Accruing substandard loans have a well-defined weakness, or weaknesses, such as loans to borrowers who may be experiencing losses from operations or inadequate liquidity of a degree and duration that jeopardizes the orderly repayment of the loan. Substandard loans are also distinguished by the distinct possibility of loss in the future if these weaknesses are not corrected. Nonaccrual loans are loans for which the accrual of interest has been discontinued. For further information regarding nonaccrual loans, refer to the Nonperforming Assets subheading in Note 1 - Basis of Presentation and Accounting Policies on page F-52 in the Corporation's 2023 Annual Report. These categories are generally consistent with the "special mention" and "substandard" categories as defined by regulatory authorities. A minority of nonaccrual loans are consistent with the "doubtful" category.

Table of Contents

Notes to Consolidated Financial Statements (unaudited)

Comerica Incorporated and Subsidiaries

Loan interest receivable totaled $ 277 million and $ 313 million at September 30, 2024 and December 31, 2023, respectively, and was included in accrued income and other assets on the Consolidated Balance Sheets.

Allowance for Credit Losses

The following table details the changes in the allowance for credit losses.


	2024									2023
(in millions)	Business Loans			Retail Loans			Total			Business Loans			Retail Loans			Total
Three Months Ended September 30
Balance at beginning of period:

Allowance for loan losses	$	620		$	66		$	686		$	614		$	70		$	684
Allowance for credit losses on lending-related commitments	23			8			31			34			10			44
Allowance for credit losses	643			74			717			648			80			728

Loan charge-offs	( 23 )			—			( 23 )			( 13 )			( 1 )			( 14 )
Recoveries on loans previously charged-off	12			—			12			7			1			8
Net loan charge-offs	( 11 )			—			( 11 )			( 6 )			—			( 6 )
Provision for credit losses:
Provision for loan losses	9			2			11			18			( 2 )			16
Provision for credit losses on lending-related commitments	3			—			3			( 1 )			( 1 )			( 2 )
Provision for credit losses	12			2			14			17			( 3 )			14

Balance at end of period:
Allowance for loan losses	618			68			686			626			68			694
Allowance for credit losses on lending-related commitments	26			8			34			33			9			42
Allowance for credit losses	$	644		$	76		$	720		$	659		$	77		$	736
Nine Months Ended September 30
Balance at beginning of period
Allowance for loan losses	$	620		$	68		$	688		$	541		$	69		$	610
Allowance for credit losses on lending-related commitments	31			9			40			40			11			51
Allowance for credit losses	651			77			728			581			80			661

Loan charge-offs	( 71 )			( 1 )			( 72 )			( 34 )			( 3 )			( 37 )
Recoveries on loans previously charged-off	34			2			36			33			2			35
Net loan (charge-offs) recoveries	( 37 )			1			( 36 )			( 1 )			( 1 )			( 2 )
Provision for credit losses:
Provision for loan losses	35			( 1 )			34			86			—			86
Provision for credit losses on lending-related commitments	( 5 )			( 1 )			( 6 )			( 7 )			( 2 )			( 9 )
Provision for credit losses	30			( 2 )			28			79			( 2 )			77

Balance at end of period:
Allowance for loan losses	618			68			686			626			68			694
Allowance for credit losses on lending-related commitments	26			8			34			33			9			42
Allowance for credit losses	$	644		$	76		$	720		$	659		$	77		$	736
Allowance for loan losses as a percentage of total loans	1.33		%	1.63		%	1.36		%	1.27		%	1.62		%	1.30		%

Allowance for credit losses as a percentage of total loans	1.39			1.83			1.43			1.34			1.84			1.38

Table of Contents

Notes to Consolidated Financial Statements (unaudited)

Comerica Incorporated and Subsidiaries

Nonaccrual Loans

The following table presents additional information regarding nonaccrual loans. Interest income of $ 2 million was recognized on nonaccrual loans at both the three-month periods ended September 30, 2024 and 2023. The Corporation recognized interest income on nonaccrual loans of $ 8 million at both nine months ended September 30, 2024 and 2023.


(in millions)	Nonaccrual Loans with No Related Allowance		Nonaccrual Loans with Related Allowance		Total Nonaccrual Loans
September 30, 2024
Business loans:
Commercial	$	22	$	75	$	97




Commercial mortgage:
Commercial Real Estate business line (a)	—		18		18
Other business lines (b)	8		62		70
Total commercial mortgage	8		80		88
Lease financing	—		1		1
International	—		3		3
Total business loans	30		159		189
Retail loans:
Residential mortgage	36		—		36
Consumer:
Home equity	25		—		25


Total retail loans	61		—		61
Total nonaccrual loans	$	91	$	159	$	250
December 31, 2023
Business loans:
Commercial	$	47	$	28	$	75
Real estate construction:

Other business lines (b)	2		—		2

Commercial mortgage:
Commercial Real Estate business line (a)	—		18		18
Other business lines (b)	17		6		23
Total commercial mortgage	17		24		41
International	3		17		20
Total business loans	69		69		138
Retail loans:
Residential mortgage	19		—		19
Consumer:
Home equity	21		—		21

Total consumer	21		—		21
Total retail loans	40		—		40
Total nonaccrual loans	$	109	$	69	$	178

(a) Primarily loans to real estate developers.

(b) Primarily loans secured by owner-occupied real estate.

Foreclosed Properties

Foreclosed properties were insignificant at both September 30, 2024 and December 31, 2023. Retail loans secured by residential real estate properties in process of foreclosure included in nonaccrual loans were $ 4 million at September 30, 2024 and insignificant at December 31, 2023.

Table of Contents

Notes to Consolidated Financial Statements (unaudited)

Comerica Incorporated and Subsidiaries

Loan Modifications Made to Borrowers Experiencing Financial Difficulty

As part of its loss mitigation efforts, the Corporation may modify loans to borrowers experiencing financial difficulty in a manner resulting in an interest rate reduction, other-than-insignificant payment delay, a term extension, principal forgiveness or a combination thereof (collectively referred to as Financially Distressed Modifications, or FDMs).

The following table displays the amortized cost basis of FDMs at September 30, 2024 and 2023 that were restructured during the three- and nine-month periods ended September 30, 2024 and 2023 by type of modification.


(in millions)	Term Extension (a)		Payment Delay (a)		Interest Rate Reduction		Combinations (b)		Total		Percent of Total Class
Three Months Ended September 30, 2024
Business loans:
Commercial	$	93	$	—	$	—	$	5	$	98	0.38	%




Commercial mortgage:

Other business lines (c)	9		—		—		—		9		0.11
Total commercial mortgage	9		—		—		—		9		0.06
International	2		—		—		—		2		0.16
Total business loans	104		—		—		5		109		0.24
Retail loans:
Residential mortgage	5		—		—		—		5		0.27	%
Consumer:
Home equity	—		3		3		1		7		0.39

Total consumer	—		3		3		1		7		0.31
Total retail loans	5		3		3		1		12		0.29
Total loans	$	109	$	3	$	3	$	6	$	121	0.24	%
Three Months Ended September 30, 2023
Business loans:
Commercial	$	54	$	—	$	4	$	—	$	58	0.20	%
Real estate construction:

Other business lines (c)	8		—		—		—		8		1.44
Total real estate construction	8		—		—		—		8		0.17
Commercial mortgage:

Other business lines (c)	1		—		—		6		7		0.08
Total commercial mortgage	1		—		—		6		7		0.05

Total business loans	63		—		4		6		73		0.15


Consumer:
Home equity	—		—		1		1		2		0.11

Total consumer	—		—		1		1		2		0.09
Total retail loans	—		—		1		1		2		0.05
Total loans	$	63	$	—	$	5	$	7	$	75	0.14	%

Table continues on the following page.

Table of Contents

Notes to Consolidated Financial Statements (unaudited)

Comerica Incorporated and Subsidiaries


(in millions)	Term Extension (a)		Payment Delay (a)		Interest Rate Reduction		Combinations (b)		Total		Percent of Total Class
Nine Months Ended September 30, 2024
Business loans:
Commercial	$	204	$	—	$	—	$	19	$	223	0.86	%




Commercial mortgage:

Other business lines (c)	22		—		—		—		22		0.26
Total commercial mortgage	22		—		—		—		22		0.15
International	4		—		—		—		4		0.37
Total business loans	230		—		—		19		249		0.54
Retail loans:
Residential mortgage	5		—		—		—		5		0.27
Consumer:
Home equity	1		3		4		2		10		0.55

Total consumer	1		3		4		2		10		0.43
Total retail loans	6		3		4		2		15		0.36
Total loans	$	236	$	3	$	4	$	21	$	264	0.52	%
Nine Months Ended September 30, 2023
Business loans:
Commercial	$	87	$	21	$	4	$	1	$	113	0.39	%
Real estate construction:

Other business lines (c)	8		—		—		—		8		1.44
Total real estate construction	8		—		—		—		8		0.17
Commercial mortgage:

Other business lines (c)	4		—		1		11		16		0.18
Total commercial mortgage	4		—		1		11		16		0.12

Total business loans	99		21		5		12		137		0.28


Consumer:
Home equity	1		—		1		1		3		0.15

Total consumer	1		—		1		1		3		0.13
Total retail loans	1		—		1		1		3		0.07
Total loans	$	100	$	21	$	6	$	13	$	140	0.26	%

(a) Represents loan balances where terms were extended or payments were delayed by a more than an insignificant time period, typically more than 180 days, at or above contractual interest rates.

(b) Relates to FDMs where more than one type of modification was made. For the three- and nine-month periods ended September 30, 2024 and 2023, this primarily related to modifications where the interest rate was reduced and the term was extended.

(d) Primarily loans to real estate developers.

There were no commitments to lend additional funds to borrowers experiencing financial difficulty whose terms had been restructured at September 30, 2024 and December 31, 2023.

Table of Contents

Notes to Consolidated Financial Statements (unaudited)

Comerica Incorporated and Subsidiaries

The following table summarizes the financial impacts of loan modifications made during the three- and nine-month periods ended September 30, 2024 and 2023.


	Weighted-Average Term Extension (in months)	Weighted-Average Interest Rate Reduction
Three Months Ended September 30, 2024
Business loans:
Commercial	12.7	( 1.00 )	%




Commercial mortgage:

Other business lines (a)	16.9	—
Total commercial mortgage	16.9	—

International	10.7	—
Total business loans	13.0	( 1.00 )
Retail loans:
Residential mortgage	95.1	—
Consumer:
Home equity	120.0	( 4.34 )

Total consumer	120.0	( 4.34 )
Total retail loans	100.0	( 4.34 )
Total loans	17.8	( 2.51 )	%
Three Months Ended September 30, 2023
Business loans:
Commercial	7.4	( 0.50 )	%
Real estate construction:

Other business lines (a)	6.0	—
Total real estate construction	6.0	—
Commercial mortgage:

Other business lines (a)	8.7	( 1.00 )
Total commercial mortgage	8.7	( 1.00 )


Total business loans	7.4	( 0.81 )
Retail loans:

Consumer:
Home equity	131.1	( 2.85 )

Total consumer	131.1	( 2.85 )
Total retail loans	131.1	( 2.85 )
Total loans	9.2	( 1.09 )	%

Table continues on the following page.

Table of Contents

Notes to Consolidated Financial Statements (unaudited)

Comerica Incorporated and Subsidiaries


	Weighted-Average Term Extension (in months)	Weighted-Average Interest Rate Reduction
Nine Months Ended September 30, 2024
Business loans:
Commercial	12.7	( 1.23 )	%




Commercial mortgage:

Other business lines (a)	12.3	—
Total commercial mortgage	12.3	—

International	11.4	—
Total business loans	12.6	( 1.23 )
Retail loans:
Residential mortgage	95.1	—
Consumer:
Home equity	119.3	( 4.01 )

Total consumer	119.3	( 4.01 )
Total retail loans	103.2	( 4.01 )
Total loans	15.3	( 1.91 )	%
Nine Months Ended September 30, 2023
Business loans:
Commercial	8.0	( 0.49 )	%
Real estate construction:

Other business lines (a)	6.0	—
Total real estate construction	6.0	—
Commercial mortgage:

Other business lines (a)	22.0	( 0.79 )
Total commercial mortgage	22.0	( 0.79 )


Total business loans	9.7	( 0.70 )
Retail loans:

Consumer:
Home equity	129.0	( 2.64 )

Total consumer	129.0	( 2.64 )
Total retail loans	129.0	( 2.64 )
Total loans	11.0	( 0.89 )	%

(a) Primarily loans secured by owner-occupied real estate.

(b) Primarily loans to real estate developers.

On an ongoing basis, the Corporation monitors the performance of modified loans related to their restructured terms. Loans restructured during the three- and nine-month periods ended September 30, 2024 and 2023 were current under modified terms at September 30, 2024 and September 30, 2023. Nonperforming restructured loans are classified as nonaccrual loans and are individually evaluated for the allowance for loan losses.

For restructured loans, a subsequent payment default is defined in terms of delinquency, when a principal or interest payment is 90 days past due or classified into nonaccrual status during the reporting period. Of the loans restructured during the nine-month period ended September 30, 2024, there were $ 7 million of commercial loans that subsequently defaulted. There were no subsequent defaults on loans restructured during the three-month period ended September 30, 2024 and three- and nine-month periods ended September 30, 2023.

Table of Contents

Notes to Consolidated Financial Statements (unaudited)

Comerica Incorporated and Subsidiaries

NOTE 5 - GOODWILL AND INTANGIBLES

The following table summarizes the carrying value of goodwill by reporting unit at September 30, 2024 and December 31, 2023.


(in millions)	September 30, 2024		December 31, 2023
Commercial Bank	$	473	$	473
Retail Bank	101		101
Wealth Management	61		61
Total	$	635	$	635

The annual test of goodwill impairment was performed as of the beginning of the third quarter 2024. The Corporation first assessed qualitative factors to determine whether it was more likely than not that the fair value of any reporting unit was less than its carrying amount, including goodwill. Qualitative factors included economic conditions, industry and market considerations, cost factors, overall financial performance and performance of the Corporation's stock, among other events and circumstances. At the conclusion of the qualitative assessment in third quarter 2024, the Corporation determined that it was more likely than not that the fair value of each reporting unit exceeded its carrying value.

Analyzing goodwill includes consideration of various factors that involve a degree of uncertainty, including the impacts of monetary policy actions, foreign developments, and unanticipated legislative or regulatory changes, among other factors that could cause the fair value of one or more of the reporting units to fall below their carrying value, resulting in a goodwill impairment charge in the future. Any impairment charge would not affect the Corporation's regulatory capital ratios, tangible equity ratio or liquidity position.

NOTE 6 – DERIVATIVES AND CREDIT-RELATED FINANCIAL INSTRUMENTS

In the normal course of business, the Corporation enters into various transactions involving derivative and credit-related financial instruments to manage exposure to fluctuations in interest rate, foreign currency and other market risks and to meet the financing needs of customers (customer-initiated derivatives). These financial instruments involve, to varying degrees, elements of market and credit risk. Market and credit risk are included in the determination of fair value.

Market risk is the potential loss that may result from movements in interest rates, foreign currency exchange rates or energy commodity prices that cause an unfavorable change in the value of a financial instrument. The Corporation manages this risk by establishing monetary exposure limits and monitoring compliance with those limits. Market risk inherent in interest rate and energy contracts entered into on behalf of customers is mitigated by taking offsetting positions, except in those circumstances when the amount, tenor and/or contract rate level results in negligible economic risk, whereby the cost of purchasing an offsetting contract is not economically justifiable. The Corporation mitigates most of the inherent market risk in foreign exchange contracts entered into on behalf of customers by taking offsetting positions and manages the remainder through individual foreign currency position limits and aggregate value-at-risk limits. Position and value-at-risk limits are established annually and monitored daily. Market risk inherent in derivative instruments held or issued for risk management purposes is typically offset by changes in the fair value of the assets or liabilities being hedged.

Credit risk is the possible loss that may occur in the event of nonperformance by the counterparty to a financial instrument. The Corporation attempts to minimize credit risk arising from customer-initiated derivatives by evaluating the creditworthiness of each customer, adhering to the same credit approval process used for traditional lending activities and obtaining collateral as deemed necessary. Derivatives with dealer counterparties are either cleared through a clearinghouse or settled directly with a single counterparty. For derivatives settled directly with dealer counterparties, the Corporation utilizes counterparty risk limits and monitoring procedures as well as master netting arrangements and bilateral collateral agreements to facilitate the management of credit risk.

Included in the fair value of derivative instruments are credit valuation adjustments reflecting counterparty credit risk. These adjustments are determined by applying a credit spread for the counterparty or the Corporation, as appropriate, to the total expected exposure of the derivative. Master netting arrangements effectively reduce credit valuation adjustments by permitting settlement of positive and negative positions and offset cash collateral held with the same counterparty on a net basis. Bilateral collateral agreements require daily exchange of cash or highly rated securities issued by the U.S. Treasury or other U.S. government entities to collateralize amounts due to either party. At September 30, 2024, counterparties with bilateral collateral agreements deposited $ 59 million of cash with the Corporation to secure the fair value of contracts in an unrealized gain position, and the Corporation had pledged $ 4 million of marketable investment securities and posted $ 5 million of cash as collateral for contracts in an unrealized loss position. For those counterparties not covered under bilateral collateral agreements,

Table of Contents

Notes to Consolidated Financial Statements (unaudited)

Comerica Incorporated and Subsidiaries

collateral is obtained, if deemed necessary, based on the results of management’s credit evaluation of the counterparty. Collateral varies, but may include cash, investment securities, accounts receivable, equipment or real estate.

Derivative Instruments

Derivative instruments utilized by the Corporation are negotiated over-the-counter and primarily include swaps, caps and floors, forward contracts and options, each of which may relate to interest rates, energy commodity prices or foreign currency exchange rates. Swaps are agreements in which two parties periodically exchange cash payments based on specified indices applied to a specified notional amount until a stated maturity. Caps and floors are agreements which entitle the buyer to receive cash payments based on the difference between a specified reference rate or price and an agreed strike rate or price, applied to a specified notional amount until a stated maturity. Forward contracts are over-the-counter agreements to buy or sell an asset at a specified future date and price. Options are similar to forward contracts except the purchaser has the right, but not the obligation, to buy or sell the asset during a specified period or at a specified future date.

Over-the-counter contracts are tailored to meet the needs of the counterparties involved and, therefore, contain a greater degree of credit risk and liquidity risk than exchange-traded contracts, which have standardized terms and readily available price information. The Corporation reduces exposure to market and liquidity risks from over-the-counter derivative instruments entered into for risk management purposes, and transactions entered into to mitigate the market risk associated with customer-initiated transactions, by taking offsetting positions with investment grade domestic and foreign financial institutions and subjecting counterparties to credit approvals, limits and collateral monitoring procedures similar to those used in making other extensions of credit. In addition, certain derivative contracts executed bilaterally with a dealer counterparty in the over-the-counter market are cleared through a clearinghouse, whereby the clearinghouse becomes the counterparty to the transaction.

Table of Contents

Notes to Consolidated Financial Statements (unaudited)

Comerica Incorporated and Subsidiaries

The following table presents the composition of the Corporation’s derivative instruments held or issued for risk management purposes or in connection with customer-initiated and other activities at September 30, 2024 and December 31, 2023. The table excludes a derivative related to the Corporation's 2008 sale of its remaining ownership of Visa shares and includes accrued interest receivable and payable.


	September 30, 2024						December 31, 2023
			Fair Value						Fair Value
(in millions)	Notional/ Contract Amount (a)		Gross Derivative Assets		Gross Derivative Liabilities		Notional/ Contract Amount (a)		Gross Derivative Assets		Gross Derivative Liabilities
Risk management purposes
Derivatives designated as hedging instruments
Interest rate contracts:
Fair value swaps - receive fixed/pay floating	$	6,800	$	—	$	—	$	6,300	$	—	$	—
Cash flow swaps - receive fixed/pay floating (b)	29,500		—		60		24,850		—		8
Derivatives used as economic hedges
Foreign exchange contracts:
Spot, forwards and swaps	560		—		2		560		1		3
Total risk management purposes	36,860		—		62		31,710		1		11
Customer-initiated and other activities
Interest rate contracts:
Caps and floors written	1,859		—		13		1,577		—		18
Caps and floors purchased	1,859		13		—		1,577		18		—
Swaps (c)	23,448		184		267		19,316		207		409
Total interest rate contracts	27,166		197		280		22,470		225		427
Energy contracts:
Caps and floors written	3,823		2		229		3,719		3		291
Caps and floors purchased	3,823		230		2		3,719		292		3
Swaps	6,802		361		341		6,368		463		442
Total energy contracts	14,448		593		572		13,806		758		736
Foreign exchange contracts:
Spot, forwards, options and swaps	2,960		42		35		2,751		35		32
Total customer-initiated and other activities	44,574		832		887		39,027		1,018		1,195
Total gross derivatives	$	81,434	832		949		$	70,737	1,019		1,206
Amounts offset in the Consolidated Balance Sheets:
Netting adjustment - Offsetting derivative assets/liabilities			( 325 )		( 325 )				( 311 )		( 311 )
Netting adjustment - Cash collateral received/posted			( 55 )		( 5 )				( 143 )		( 13 )
Net derivatives included in the Consolidated Balance Sheets (d)			452		619				565		882
Amounts not offset in the Consolidated Balance Sheets:
Marketable securities pledged under bilateral collateral agreements			( 323 )		( 3 )				( 501 )		( 4 )
Net derivatives after deducting amounts not offset in the Consolidated Balance Sheets			$	129	$	616			$	64	$	878

(a) Notional or contractual amounts, which represent the extent of involvement in the derivatives market, are used to determine the contractual cash flows required in accordance with the terms of the agreement. These amounts are typically not exchanged, significantly exceed amounts subject to credit or market risk and are not reflected in the Consolidated Balance Sheets.

(b) September 30, 2024 included $ 6.1 billion of forward starting swaps that will become effective on their contractual start dates in 2024. Forward starting SOFR swaps with a notional amount of $5.6 billion will replace existing short-dated BSBY swaps.

(c) September 30, 2024 included a temporary increase of $3.7 billion to notional amounts related to the transition from BSBY to SOFR.

(d) Net derivative assets are included in accrued income and other assets and net derivative liabilities are included in accrued expenses and other liabilities on the Consolidated Balance Sheets. Included in the fair value of net derivative assets and net derivative liabilities are credit valuation adjustments reflecting counterparty credit risk and credit risk of the Corporation. The fair value of net derivative assets included credit valuation adjustments for counterparty credit risk of $ 3 million at both September 30, 2024 and December 31, 2023.

Table of Contents

Notes to Consolidated Financial Statements (unaudited)

Comerica Incorporated and Subsidiaries

Risk Management

The Corporation's derivative instruments used for managing interest rate risk include cash flow hedging strategies that convert variable-rate loans to fixed rates and fair value hedging strategies that convert fixed-rate medium- and long-term debt to variable rates. Interest and fees on loans included $ 178 million and $ 163 million of cash flow hedge losses for the three-month periods ended September 30, 2024 and 2023, respectively, and $ 522 million and $ 432 million of cash flow hedge losses for the nine-month periods ended September 30, 2024 and 2023, respectively.

The following table details the effects of fair value hedging on the Consolidated Statements of Comprehensive Income.


	Interest on Medium- and Long-Term Debt
	Three Months Ended September 30,				Nine Months Ended September 30,
(in millions)	2024		2023		2024		2023
Total interest on medium- and long-term debt (a)	$	117	$	106	$	358	$	273
Fair value hedging relationships:
Interest rate contracts:
Hedged items	84		74		252		194
Derivatives designated as hedging instruments	33		32		106		79

(a) Includes the effects of hedging.

The following tables summarize the expected weighted average remaining maturity of the notional amount of risk management interest rate swaps, the weighted average interest rates associated with amounts expected to be received or paid on interest rate swap agreements, and for fair value swaps, the weighted average carrying amount of the related hedged items, as of September 30, 2024 and December 31, 2023.

Cash flow swaps - receive fixed/pay floating rate on variable-rate loans


	September 30, 2024		December 31, 2023
Weighted average:
Time to maturity (in years)	2.7		3.9
Receive rate (a)	2.51	%	2.43	%
Pay rate (a), (b)	5.19		5.38

(a) Excludes forward starting swaps not effective as of the period shown. September 30, 2024 excluded $ 6.1 billion of forward starting swaps. December 31, 2023 excluded $ 2.0 billion of forward starting swaps.

(b) Variable rates paid on receive fixed swaps designated as cash flow hedges are based on BSBY or Secured Overnight Financing Rate (SOFR) rates in effect at September 30, 2024 and December 31, 2023. Derivative contracts with maturity dates beyond the BSBY cessation date will fall back to the daily SOFR with a spread adjustment.

Fair value swaps - receive fixed/pay floating rate on medium- and long-term debt


(dollar amounts in millions)	September 30, 2024			December 31, 2023
Carrying value of hedged items (a)	$	6,786		$	6,206
Weighted average:
Time to maturity (in years)	2.9			3.1
Receive rate (b)	3.77		%	3.67		%
Pay rate (b)	5.26			5.74

(a) Included $(8) million and $( 93 ) million of cumulative hedging adjustments at September 30, 2024 and December 31, 2023, respectively, which included $ 2 million and $ 3 million, respectively, of hedging adjustment on a discontinued hedging relationship.

(b) Floating rates paid on receive fixed swaps designated as fair value hedges are based on SOFR rates in effect at September 30, 2024 and December 31, 2023.

Table of Contents

Notes to Consolidated Financial Statements (unaudited)

Comerica Incorporated and Subsidiaries

Re-designated Interest Rate Swaps and Price Alignment Income

On November 15, 2023, the Bloomberg Index Services Limited (Bloomberg) announced that it will discontinue publishing the Bloomberg Short-Term Bank Yield Index (BSBY) on November 15, 2024; accordingly, the Corporation was required to “de-designate” $ 7.0 billion of interest rate swaps used in cash flow hedges of certain BSBY-indexed loans and reclassify amounts recognized in accumulated other comprehensive income into earnings. For each de-designated swap, settlement of interest payments and changes in fair value were recorded as risk management hedging losses within noninterest income instead of net interest income until re-designation. As all impacted swaps were re-designated as of April 1, 2024, there was no impact to noninterest income for the three-month periods ended September 30, 2024 and June 30, 2024. A total of $ 130 million in net losses were included in noninterest income as a result of the de-designations, consisting of $ 39 million during the first quarter 2024 and $ 91 million during the fourth quarter 2023.

Amounts in accumulated other comprehensive income related to cash flows that continued to be probable of occurring were amortized out of accumulated other comprehensive income and into earnings, which resulted in pre-tax losses of $ 52 million recorded in interest and fees on loans during both three-month periods ended September 30, 2024 and June 30, 2024. Additionally, the fair value of swaps at re-designation date were accreted back into accumulated other comprehensive income, resulting in benefits of $ 43 million for the three months ended September 30, 2024 and $ 49 million for the three months ended June 30, 2024. The amortization of probable cash flows and fair value accretion resulted in net losses of $ 9 million and $ 3 million included in net interest income for the three months ended September 30, 2024 and June 30, 2024, respectively.

BSBY cessation and the related de-designation and re-designation of interest rate swaps led to net increases in accumulated other comprehensive income of $ 7 million and $ 2 million for the three months ended September 30, 2024 and June 30, 2024, respectively.

For more information on accumulated net losses on cash flow hedges, refer to Note 9.

Risk management hedging income (loss) also includes price alignment income, which is income received on payments made to a central clearing party for centrally cleared derivatives. Positions are settled daily based on derivative fair values and the party receiving net settlement amounts pays price alignment, based on an earning rate, to the party making settlement payments. Price alignment income totaled $ 8 million and $ 17 million for the three-month periods ended September 30, 2024 and 2023, respectively, and $ 38 million and $ 32 million for the nine-month periods ended September 30, 2024 and 2023.

Customer-Initiated and Other

The Corporation enters into derivative transactions at the request of customers and generally takes offsetting positions with dealer counterparties to help mitigate the inherent market risk. Income primarily results from the spread between the customer derivative and the offsetting dealer position.

For customer-initiated foreign exchange contracts where offsetting positions have not been taken, the Corporation manages the remaining inherent market risk through individual foreign currency position limits and aggregate value-at-risk limits. Position and value-at-risk limits are established annually and monitored daily. For foreign exchange derivative contracts which were not offset or where the Corporation holds a position within the limits described above, the Corporation did not recognize any net gains or losses for the three months ended September 30, 2024 and 2023. The Corporation did not recognize any gains or loss for the nine months ended September 30, 2024, compared to a net loss of $ 1 million for the nine months ended September 30, 2023.

Table of Contents

Notes to Consolidated Financial Statements (unaudited)

Comerica Incorporated and Subsidiaries

Fair values of customer-initiated and other derivative instruments represent the net unrealized gains or losses on such contracts and are recorded on the Consolidated Balance Sheets. Changes in fair value are recognized on the Consolidated Statements of Comprehensive Income. The net gains recognized in income on customer-initiated derivative instruments, net of the impact of offsetting positions included in capital markets income, were as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
(in millions)	2024		2023		2024		2023
Interest rate contracts	$	7	$	5	$	15	$	17
Energy contracts	5		4		13		17
Foreign exchange contracts	11		12		35		40
Total	$	23	$	21	$	63	$	74

Credit-Related Financial Instruments

The Corporation issues off-balance sheet financial instruments in connection with commercial and consumer lending activities. The Corporation’s credit risk associated with these instruments is represented by the contractual amounts indicated in the following table.


(in millions)	September 30, 2024		December 31, 2023
Unused commitments to extend credit:
Commercial and other	$	24,081	$	27,303
Bankcard, revolving credit and home equity loan commitments	4,002		4,082
Total unused commitments to extend credit	$	28,083	$	31,385
Standby letters of credit	$	3,748	$	3,586
Commercial letters of credit	53		48

The Corporation maintains an allowance to cover current expected credit losses inherent in lending-related commitments, including unused commitments to extend credit, letters of credit and financial guarantees. The allowance for credit losses on lending-related commitments, included in accrued expenses and other liabilities on the Consolidated Balance Sheets, was $ 34 million and $ 40 million at September 30, 2024 and December 31, 2023, respectively.

Unused Commitments to Extend Credit

Commitments to extend credit are legally binding agreements to lend to a customer, provided there is no violation of any condition established in the contract. These commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. Since many commitments expire without being drawn upon, the total contractual amount of commitments does not necessarily represent future cash requirements of the Corporation. Commercial and other unused commitments are primarily variable rate commitments. The allowance for credit losses on lending-related commitments included $ 31 million at September 30, 2024 and $ 38 million at December 31, 2023 for expected credit losses inherent in the Corporation’s unused commitments to extend credit.

Standby and Commercial Letters of Credit

Standby letters of credit represent conditional obligations of the Corporation which guarantee the performance of a customer to a third party. Standby letters of credit are primarily issued to support public and private borrowing arrangements, including commercial paper, bond financing and similar transactions. Commercial letters of credit are issued to finance foreign or domestic trade transactions. These contracts expire in decreasing amounts through the year. The Corporation may enter into participation arrangements with third parties that effectively reduce the maximum amount of future payments which may be required under standby and commercial letters of credit. These risk participations covered $ 73 million and $ 85 million at September 30, 2024 and December 31, 2023, respectively, of the $ 3.8 billion and $ 3.6 billion of standby and commercial letters of credit outstanding at September 30, 2024 and December 31, 2023, respectively.

The carrying value of the Corporation’s standby and commercial letters of credit, included in accrued expenses and other liabilities on the Consolidated Balance Sheets, totaled $ 35 million at September 30, 2024, including $ 32 million in deferred fees and $ 3 million in the allowance for credit losses on lending-related commitments. At December 31, 2023, the comparable amounts were $ 34 million, $ 32 million and $ 2 million, respectively.

The following table presents a summary of criticized standby and commercial letters of credit at September 30, 2024 and December 31, 2023. The Corporation's criticized list is consistent with the Special Mention, Substandard and Doubtful

Table of Contents

Notes to Consolidated Financial Statements (unaudited)

Comerica Incorporated and Subsidiaries

categories defined by regulatory authorities. The Corporation manages credit risk through underwriting, periodically reviewing and approving its credit exposures using Board committee approved credit policies and guidelines.


(dollar amounts in millions)	September 30, 2024			December 31, 2023
Total criticized standby and commercial letters of credit	$	45		$	50
As a percentage of total outstanding standby and commercial letters of credit	1.2		%	1.4		%

Other Credit-Related Financial Instruments

The Corporation enters into credit risk participation agreements, under which the Corporation assumes credit exposure associated with a borrower’s performance related to certain interest rate derivative contracts. The Corporation is not a party to the interest rate derivative contracts and only enters into these credit risk participation agreements in instances in which the Corporation is also a party to the related loan participation agreements for such borrowers. The Corporation manages its credit risk on the credit risk participation agreements by monitoring the creditworthiness of the borrowers, which is based on the normal credit review process as if the Corporation had entered into the derivative instruments directly with the borrower. The notional amount of such credit risk participation agreements reflects the pro-rata share of the derivative instrument, consistent with its share of the related participated loan. The total notional amount of the credit risk participation agreements was approximately $ 1.0 billion at both September 30, 2024 and December 31, 2023, and the fair value was insignificant at both September 30, 2024 and December 31, 2023. The maximum estimated exposure to these agreements, as measured by projecting a maximum value of the guaranteed derivative instruments, assuming 100 percent default by all obligors on the maximum values, was $ 8 million and $ 2 million at September 30, 2024 and December 31, 2023, respectively. In the event of default, the lead bank has the ability to liquidate the assets of the borrower, in which case the lead bank would be required to return a percentage of the recouped assets to the participating banks. As of September 30, 2024, the weighted average remaining maturity of outstanding credit risk participation agreements was 4.6 years.

In 2008, the Corporation sold its remaining ownership of Visa Class B shares and entered into a derivative contract. Under the terms of the derivative contract, the Corporation will compensate the counterparty primarily for dilutive adjustments made to the conversion factor of the Visa Class B shares to Class A shares based on the ultimate outcome of litigation involving Visa. Conversely, the Corporation will be compensated by the counterparty for any increase in the conversion factor from anti-dilutive adjustments. The fair value of the derivative liability, included in accrued expenses and other liabilities on the Consolidated Balance Sheets, was $ 11 million and $ 12 million at September 30, 2024 and December 31, 2023, respectively.

NOTE 7 - VARIABLE INTEREST ENTITIES (VIEs)

The Corporation evaluates its interest in certain entities to determine if these entities meet the definition of a VIE and whether the Corporation is the primary beneficiary and should consolidate the entity based on the variable interests it held both at inception and when there is a change in circumstances that requires a reconsideration.

The Corporation holds ownership interests in funds in the form of limited partnerships or limited liability companies (LLCs) investing in affordable housing projects that qualify for the low-income housing tax credit (LIHTC). The Corporation also directly invests in limited partnerships and LLCs which invest in community development projects, which generate similar tax credits to investors (other tax credit entities). As an investor, the Corporation obtains income tax credits and deductions from the operating losses of these tax credit entities. These tax credit entities meet the definition of a VIE; however, the Corporation is not the primary beneficiary of the entities, as the general partner or the managing member has both the power to direct the activities that most significantly impact the economic performance of the entities and the obligation to absorb losses or the right to receive benefits that could be significant to the entities.

The Corporation accounts for its interests in LIHTC entities and, upon adoption of ASU 2023-02 as discussed in Note 1, other tax credit entities that meet certain criteria using the proportional amortization method. Ownership interests in tax credit entities that do not qualify for the proportional amortization method are accounted for under either the cost or equity method. Exposure to loss as a result of the Corporation's involvement in entities using the proportional amortization method and other tax credit entities at September 30, 2024 was limited to $ 579 million and $ 1 million, respectively.

Investment balances, including all legally binding commitments to fund future investments that are accounted for using the proportional amortization method, are included in accrued income and other assets on the Consolidated Balance Sheets. A liability is recognized in accrued expenses and other liabilities on the Consolidated Balance Sheets for all legally binding unfunded commitments to fund tax credit entities that are accounted for using the proportional amortization method ($ 255 million at September 30, 2024). Amortization and other write-downs of tax credit investments for which the proportional amortization method is applied are presented on a net basis as a component of the provision for income taxes on the Consolidated Statements of Comprehensive Income, while amortization and write-downs of other tax credit investments are

Table of Contents

Notes to Consolidated Financial Statements (unaudited)

Comerica Incorporated and Subsidiaries

recorded in other noninterest income. The income tax credits and deductions are recorded as a reduction of income tax expense and a reduction of federal income taxes payable. The cash flows related to the total income tax benefits are presented in the "net income," "benefit for deferred income taxes" and "other, net" line items within the operating activities section of the Consolidated Statements of Cash Flows.

The Corporation provided no financial or other support that was not contractually required to any of the above VIEs during the nine months ended September 30, 2024 and 2023.

The following table summarizes the impact of these tax credit investments under the proportional amortization method on the Corporation’s Consolidated Statements of Comprehensive Income.


	Three Months Ended September 30,		Nine Months Ended September 30,
(in millions)	2024		2024


Provision for income taxes:
Amortization of investments	$	16	$	55
Tax credits	( 17 )		( 55 )
Other income tax benefits related to tax credit entities	( 3 )		( 11 )
Total provision for income taxes	$	( 4 )	$	( 11 )

Prior to the adoption of ASU 2023-02, only LIHTC investments qualified for the proportional amortization method of accounting. The following table summarizes the impact of these LIHTC entities on the Corporation’s Consolidated Statements of Comprehensive Income.


	Three Months Ended September 30,		Nine Months Ended September 30,
(in millions)	2023			2023


Provision for income taxes:
Amortization of LIHTC investments	$	17		$	51
Low income housing tax credits	( 16 )			( 48 )
Other tax benefits related to tax credit entities	( 5 )			( 15 )
Total provision for income taxes	$	( 4 )		$	( 12 )

For further information on the Corporation’s consolidation policy, see Note 1 to the consolidated financial statements in the Corporation's 2023 Annual Report.

Table of Contents

Notes to Consolidated Financial Statements (unaudited)

Comerica Incorporated and Subsidiaries

NOTE 8 - MEDIUM- AND LONG-TERM DEBT

Medium- and long-term debt is summarized as follows:


(in millions)	September 30, 2024		December 31, 2023
Parent company
Subordinated notes:
3.80 % subordinated notes due 2026	$	245	$	241
Medium- and long-term notes:
4.00 % notes due 2029	533		523
5.982 % notes due 2030	1,014		—
Total medium- and long-term notes	1,547		523
Total parent company	1,792		764
Subsidiaries
Subordinated notes:
4.00 % subordinated notes due 2025	344		337
7.875 % subordinated notes due 2026	159		162
5.332 % subordinated notes due 2033	475		466
Total subordinated notes	978		965
Medium- and long-term notes:
2.50 % notes due July 2024	—		489
FHLB advances:
5.07 % advance due 2025	999		995
4.79 % advance due 2026	1,003		997
4.49 % advance due 2027	1,007		999
4.49 % advance due 2028	1,007		997
Total FHLB advances	4,016		3,988
Total subsidiaries	4,994		5,442
Total medium- and long-term debt	$	6,786	$	6,206

Fixed interest rates have been swapped to a variable rate and designated in a hedging relationship for all notes outstanding at September 30, 2024 and December 31, 2023. Accordingly, carrying value has been adjusted to reflect the change in fair value of the debt as a result of changes in the benchmark rate. Subordinated notes with remaining maturities greater than one year qualify as Tier 2 capital.

Comerica Bank (the Bank), a wholly-owned subsidiary of Comerica, Incorporated, is a member of the FHLB, which provides short- and long-term funding to its members through advances collateralized by real estate-related assets. Borrowing capacity is contingent on the amount of collateral available to be pledged to the FHLB. At September 30, 2024, FHLB borrowings were $ 4.0 billion, with remaining capacity for future borrowing of $ 13.3 billion, secured by real estate-related loans and investment securities collateral.

Unamortized debt issuance costs deducted from the carrying amount of medium- and long-term debt totaled $ 11 million and $ 6 million at September 30, 2024 and December 31, 2023, respectively.

Table of Contents

Notes to Consolidated Financial Statements (unaudited)

Comerica Incorporated and Subsidiaries

NOTE 9 - ACCUMULATED OTHER COMPREHENSIVE LOSS

The following table presents a reconciliation of the changes in the components of accumulated other comprehensive loss and details the components of other comprehensive income (loss) for the nine months ended September 30, 2024 and 2023, including the amount of income tax expense (benefit) allocated to each component of other comprehensive income (loss).


	Nine Months Ended September 30,
(in millions)	2024		2023
Accumulated net unrealized losses on investment securities:
Balance at beginning of period, net of tax	$	( 2,043 )	$	( 2,319 )


Net unrealized holding gains (losses) arising during the period	419		( 613 )
Less: Provision (benefit) for income taxes	94		( 144 )










Change in net unrealized losses on investment securities, net of tax	325		( 469 )
Balance at end of period, net of tax	$	( 1,718 )	$	( 2,788 )
Accumulated net losses on cash flow hedges:
Balance at beginning of period, net of tax	$	( 605 )	$	( 942 )
Net cash flow hedge losses arising during the period	( 46 )		( 871 )

Less: Benefit for income taxes	( 11 )		( 204 )
Change in net cash flow hedge losses arising during the period, net of tax	( 35 )		( 667 )
Less:
Net cash flow losses included in interest and fees on loans	( 498 )		( 432 )
Net amortization of unrealized losses related to de-designated derivatives included in interest and fees on loans	( 24 )		—
Less: Benefit for income taxes	( 123 )		( 101 )
Reclassification adjustment for net cash flow hedge losses included in net income, net of tax	( 399 )		( 331 )
Change in net cash flow hedge losses, net of tax	364		( 336 )
Balance at end of period, net of tax (a)	$	( 241 )	$	( 1,278 )
Accumulated defined benefit pension and other postretirement plans adjustment:
Balance at beginning of period, net of tax	$	( 400 )	$	( 481 )





Amounts recognized in other noninterest expenses:
Amortization of actuarial net loss	20		27
Amortization of prior service credit	( 16 )		( 17 )

Total amounts recognized in other noninterest expenses	4		10
Less: Provision for income taxes	—		3
Adjustment for amounts recognized as components of net periodic benefit credit during the period, net of tax	4		7
Change in defined benefit pension and other postretirement plans adjustment, net of tax	4		7
Balance at end of period, net of tax	$	( 396 )	$	( 474 )
Total accumulated other comprehensive loss at end of period, net of tax	$	( 2,355 )	$	( 4,540 )

(a) The Corporation expects to reclassify $ 130 million of losses, net of tax, from accumulated other comprehensive loss to earnings over the next twelve months, assuming interest yield curve at September 30, 2024 and no additions to interest rate swap portfolio.

Table of Contents

Notes to Consolidated Financial Statements (unaudited)

Comerica Incorporated and Subsidiaries

NOTE 10 - NET INCOME PER COMMON SHARE

Basic and diluted net income per common share are presented in the following table.


	Three Months Ended September 30,				Nine Months Ended September 30,

(in millions, except per share data)	2024		2023		2024		2023
Basic and diluted
Net income	$	184	$	251	$	528	$	848
Less:
Income allocated to participating securities	1		1		3		4
Preferred stock dividends	6		6		17		17
Net income attributable to common shares	$	177	$	244	$	508	$	827
Basic average common shares	133		132		133		132
Basic net income per common share	$	1.34	$	1.85	$	3.83	$	6.27
Basic average common shares	133		132		133		132
Dilutive common stock equivalents:
Net effect of the assumed exercise of stock awards	1		1		1		1

Diluted average common shares	134		133		134		133
Diluted net income per common share	$	1.33	$	1.84	$	3.80	$	6.24

The following average shares related to outstanding options to purchase shares of common stock that were not included in the computation of diluted net income per common share because the options were anti-dilutive for the period.



	Three Months Ended September 30,		Nine Months Ended September 30,
(average outstanding options in thousands)	2024	2023	2024	2023
Average outstanding options	1,488	1,633	1,800	1,540
Range of exercise prices	$ 56.79 - $ 95.25	$ 49.20 - $ 95.25	$ 53.96 - $ 95.25	$ 49.20 - $ 95.25

Table of Contents

Notes to Consolidated Financial Statements (unaudited)

Comerica Incorporated and Subsidiaries

NOTE 11 - EMPLOYEE BENEFIT PLANS

Net periodic defined benefit cost (credit) is comprised of service cost and other components of net benefit cost (credit). Service cost is included in salaries and benefits expense and other components of net benefit cost (credit) are included in other noninterest expenses on the Consolidated Statements of Comprehensive Income. For further information on the Corporation's employee benefit plans, refer to Note 17 to the consolidated financial statements in the Corporation's 2023 Annual Report.

The components of net periodic benefit cost (credit) for the Corporation's qualified pension plan, non-qualified pension plan and postretirement benefit plan are as follows.


Qualified Defined Benefit Pension Plan	Three Months Ended September 30,				Nine Months Ended September 30,
(in millions)	2024		2023		2024		2023
Service cost	$	8	$	8	$	25	$	23
Other components of net benefit credit:
Interest cost	20		21		62		64
Expected return on plan assets	( 44 )		( 41 )		( 134 )		( 124 )
Amortization of prior service credit	( 4 )		( 3 )		( 11 )		( 10 )
Amortization of net loss	6		8		17		24
Total other components of net benefit credit	( 22 )		( 15 )		( 66 )		( 46 )
Net periodic defined benefit credit	$	( 14 )	$	( 7 )	$	( 41 )	$	( 23 )


Non-Qualified Defined Benefit Pension Plan	Three Months Ended September 30,				Nine Months Ended September 30,
(in millions)	2024		2023		2024		2023
Service cost	$	1	$	1	$	2	$	2
Other components of net benefit cost:
Interest cost	2		2		6		6
Amortization of prior service credit	( 2 )		( 3 )		( 5 )		( 7 )
Amortization of net loss	1		1		3		3
Total other components of net benefit cost	1		—		4		2
Net periodic defined benefit cost	$	2	$	1	$	6	$	4


Postretirement Benefit Plan	Three Months Ended September 30,				Nine Months Ended September 30,
(in millions)	2024		2023		2024		2023
Other components of net benefit credit:
Interest cost	$	1	$	1	$	1	$	1
Expected return on plan assets	( 1 )		( 1 )		( 2 )		( 2 )




Net periodic defined benefit credit	$	—	$	—	$	( 1 )	$	( 1 )

NOTE 12 - INCOME TAXES AND TAX-RELATED ITEMS

Unrecognized tax benefits were $ 8 million and $7 million at September 30, 2024 and December 31, 2023, respectively. The Corporation does not anticipate any final settlements of federal or state tax issues to result in a change of net unrecognized tax benefits within the next twelve months. The liability for tax-related interest and penalties, included in accrued expenses and other liabilities on the Consolidated Balance Sheets, was less than $ 1 million at both September 30, 2024 and December 31, 2023.

Table of Contents

Notes to Consolidated Financial Statements (unaudited)

Comerica Incorporated and Subsidiaries

Net deferred tax assets were $ 789 million at September 30, 2024, compared to $ 1.0 billion at December 31, 2023. The decrease of approximately $ 206 million in net deferred tax assets resulted primarily from decreases to deferred tax assets related to hedging gains and losses, net unrealized losses on investment securities available-for-sale and an increase in deferred tax liabilities related to defined benefit plans. Included in deferred tax assets at September 30, 2024 were $ 2 million of state net operating loss (NOL) carryforwards and $ 6 million of federal foreign tax carryforwards, compared to $2 million and $5 million at December 31, 2023, respectively. State NOL carryforwards expire between 2024 and 2042 and federal foreign tax credit carryforwards expire between 2028 and 2034 . The Corporation believes that it is more likely than not that the benefit from federal foreign tax credits and certain state NOL carryforwards will not be realized and, accordingly, maintained a federal valuation allowance of $ 6 million at September 30, 2024, compared to $5 million at December 31, 2023. The Corporation maintained a state valuation allowance of $ 1 million at both September 30, 2024 and December 31, 2023. The determination regarding valuation allowance was based on evidence of loss carryback capacity, projected future reversals of existing taxable temporary differences to absorb the deferred tax assets and assumptions made regarding future events.

In the ordinary course of business, the Corporation enters into certain transactions that have tax consequences. From time to time, the Internal Revenue Service (IRS) or other tax jurisdictions may review and/or challenge specific interpretive tax positions taken by the Corporation with respect to those transactions. The Corporation believes its tax returns were filed based upon applicable statutes, regulations and case law in effect at the time of the transactions. The IRS or other tax jurisdictions, an administrative authority or a court, if presented with the transactions, could disagree with the Corporation’s interpretation of the tax law.

Based on current knowledge and probability assessment of various potential outcomes, the Corporation believes that current tax reserves are adequate, and the amount of any potential incremental liability arising is not expected to have a material adverse effect on the Corporation’s consolidated financial condition or results of operations. Probabilities and outcomes are reviewed as events unfold, and adjustments to the reserves are made when necessary.

NOTE 13 - CONTINGENT LIABILITIES

Legal Proceedings and Regulatory Matters

The Corporation is subject to various pending or threatened legal proceedings arising out of the normal course of business or operations. Use of the term "Corporation" in this note should not be read to infer that Comerica, Incorporated or any of its subsidiaries that is not named in any legal or regulatory proceeding undertakes any responsibility or liability for any other affiliate that is actually named in any legal or regulatory proceeding. The Corporation believes it has meritorious defenses to the claims asserted against it in its currently outstanding legal proceedings and, with respect to such legal proceedings, intends to continue to defend itself vigorously, litigating or settling cases according to management’s judgment as to what is in the best interests of the Corporation and its shareholders. Settlement may result from the Corporation's determination that it may be more prudent financially to settle, rather than litigate, and should not be regarded as an admission of liability.

Further, from time to time, the Corporation is also subject to examinations, inquiries and investigations by regulatory authorities in areas including, but not limited to, compliance, risk management and consumer protection, which could lead to administrative or legal proceedings or settlements. For example, the Consumer Financial Protection Bureau (CFPB) is investigating certain of the Corporation's practices, and the Corporation has responded and continues to respond to the CFPB. The Corporation is unable to predict the outcome of these discussions at this time. Remedies in these proceedings or settlements may include fines, penalties, restitution or alterations in the Corporation's business practices and may result in increased operating expenses or decreased revenues.

On at least a quarterly basis, the Corporation assesses its potential liabilities and contingencies in connection with outstanding legal proceedings and regulatory matters utilizing the latest information available. On a case-by-case basis, accruals are established for those legal claims and regulatory matters for which it is probable that a loss will be incurred and the amount of such loss can be reasonably estimated. The actual costs of resolving these claims and regulatory matters may be substantially higher or lower than the amounts accrued. Based on current knowledge, and after consultation with legal counsel, management believes current accruals are adequate, and the amount of any incremental liability arising from these matters is not expected to have a material adverse effect on the Corporation’s consolidated financial condition, results of operations or cash flows.

Table of Contents

Notes to Consolidated Financial Statements (unaudited)

Comerica Incorporated and Subsidiaries

For matters where a loss is not probable, the Corporation has not established an accrual. The Corporation believes the estimate of the aggregate range of reasonably possible losses, in excess of established accruals, for all legal proceedings and regulatory matters in which it is involved is from zero to approximately $ 172 million at September 30, 2024. This estimated aggregate range of reasonably possible losses is based upon currently available information for those legal proceedings and regulatory matters in which the Corporation is involved, taking into account the Corporation’s best estimate of such losses for those legal proceedings and regulatory matters for which such estimate can be made. For certain legal proceedings and regulatory matters, the Corporation does not believe that an estimate can currently be made. The Corporation’s estimate involves significant judgment, given the varying stages of the legal proceedings and regulatory matters (including the fact that many are currently in preliminary stages), the existence in certain legal proceedings of multiple defendants (including the Corporation) whose share of liability has yet to be determined, the numerous yet-unresolved issues in many of the legal proceedings and regulatory matters (including issues regarding class certification and the scope of many of the claims) and the attendant uncertainty of the various potential outcomes of such legal proceedings and regulatory matters. Accordingly, the Corporation’s estimate will change from time to time, and actual losses may be more or less than the current estimate.

In the event of unexpected future developments, it is possible the ultimate resolution of these matters, if unfavorable, may be material to the Corporation's consolidated financial condition, results of operations or cash flows.

For information regarding income tax contingencies, refer to Note 12.

NOTE 14 - STRATEGIC LINES OF BUSINESS

The Corporation has strategically aligned its operations into three major business segments: the Commercial Bank, the Retail Bank and Wealth Management. These business segments are differentiated based on the type of customer and the related products and services provided. In addition to the three major business segments, the Finance Division is also reported as a segment. The Other category includes items not directly associated with the business segments or the Finance segment. Business segment results are produced by the Corporation’s internal management accounting system. This system measures financial results based on the internal business unit structure of the Corporation. The performance of the business segments is not comparable with the Corporation's consolidated results and is not necessarily comparable with similar information for any other financial institution. Additionally, because of the interrelationships of the various segments, the information presented is not indicative of how the segments would perform if they operated as independent entities. The management accounting system assigns balance sheet and income statement items to each business segment using certain methodologies, which are regularly reviewed and refined. From time to time, the Corporation may make reclassifications among the segments to more appropriately reflect management's current view of the segments, and methodologies may be modified as the management accounting system is enhanced and changes occur in the organizational structure and/or product lines. For comparability purposes, amounts in all periods are based on business unit structure and methodologies in effect at September 30, 2024.

The following discussion provides information about the activities of each business segment. A discussion of the financial results and the factors impacting performance can be found in "Business Segments" in the "Strategic Lines of Business" section of the financial review.

The Commercial Bank meets the needs of small and middle market businesses, multinational corporations and governmental entities by offering various products and services including commercial loans and lines of credit, deposits, cash management, payment solutions, card services, capital market products, international trade finance and letters of credit.

The Retail Bank includes a full range of personal financial services, consisting of consumer lending, consumer deposit gathering and mortgage loan origination. This business segment offers a variety of consumer products including deposit accounts, installment loans, credit cards, home equity lines of credit and residential mortgage loans. In addition, this business segment offers products and services to small businesses who are serviced through a team of dedicated business bankers and our branch network.

Wealth Management provides products and services to affluent, high-net worth and ultra-high net worth individuals and families, business owners and executives, and institutional clients, including comprehensive financial planning, trust and fiduciary services, investment management and advisory, brokerage, private banking and business transition planning services.

The Finance segment includes the Corporation’s securities portfolio and asset and liability management activities. This segment is responsible for managing the Corporation’s funding, liquidity and capital needs, performing interest sensitivity analysis and executing various strategies to manage the Corporation’s exposure to liquidity, interest rate risk and foreign exchange risk.

Table of Contents

Notes to Consolidated Financial Statements (unaudited)

Comerica Incorporated and Subsidiaries

The Other category includes tax benefits not assigned to specific business segments, charges of an unusual or infrequent nature that are not reflective of the normal operations of the business segments and miscellaneous other expenses of a corporate nature.

For further information on the methodologies which form the basis for these results refer to Note 22 to the consolidated financial statements in the Corporation's 2023 Annual Report.

Business segment financial results were as follows:


	Commercial Bank			Retail Bank			Wealth Management			Finance		Other		Total
(dollar amounts in millions)
Three Months Ended September 30, 2024
Earnings Summary:
Net interest income (expense)	$	464		$	205		$	46		$	( 220 )	$	39	$	534
Provision for credit losses	6			4			3			—		1		14
Noninterest income	149			24			73			26		5		277
Noninterest expenses	252			175			90			1		44		562
Provision (benefit) for income taxes	83			12			7			( 48 )		( 3 )		51
Net income (loss)	$	272		$	38		$	19		$	( 147 )	$	2	$	184
Net charge-offs	$	10		$	1		$	—		$	—	$	—	$	11
Selected Average Balances:
Assets	$	45,669		$	3,045		$	5,296		$	18,277	$	7,944	$	80,231
Loans	43,462			2,347			5,042			—		10		50,861
Deposits	32,261			24,224			3,844			3,300		267		63,896
Statistical Data:
Return on average assets (a)	2.36		%	0.63		%	1.47		%	n/m		n/m		0.92		%
Efficiency ratio (b)	41.23			74.24			75.35			n/m		n/m		68.80
Three Months Ended September 30, 2023
Earnings Summary:
Net interest income (expense)	$	505		$	208		$	49		$	( 187 )	$	26	$	601
Provision (benefit) for credit losses	22			—			( 9 )			—		1		14
Noninterest income	150			31			78			40		( 4 )		295
Noninterest expenses	257			175			102			1		20		555
Provision (benefit) for income taxes	89			16			9			( 37 )		( 1 )		76
Net income (loss)	$	287		$	48		$	25		$	( 111 )	$	2	$	251
Net charge-offs	$	6		$	—		$	—		$	—	$	—	$	6
Selected Average Balances:
Assets	$	49,459		$	2,985		$	5,557		$	19,832	$	11,317	$	89,150
Loans	46,477			2,250			5,227			—		33		53,987
Deposits	31,868			24,034			3,950			5,711		320		65,883
Statistical Data:
Return on average assets (a)	2.30		%	0.79		%	1.81		%	n/m		n/m		1.12		%
Efficiency ratio (b)	39.34			72.71			79.99			n/m		n/m		61.86

(a) Return on average assets is calculated based on the greater of average assets or average liabilities and attributed equity.

(b) Noninterest expenses as a percentage of the sum of net interest income and noninterest income excluding net gains (losses) from securities, a derivative contract tied to the conversion rate of Visa Class B shares and changes in the value of shares obtained through monetization of warrants.

n/m – not meaningful

Table of Contents

Notes to Consolidated Financial Statements (unaudited)

Comerica Incorporated and Subsidiaries


	Commercial Bank			Retail Bank			Wealth Management			Finance		Other		Total
(dollar amounts in millions)
Nine Months Ended September 30, 2024
Earnings Summary:
Net interest income (expense)	$	1,406		$	609		$	140		$	( 657 )	$	117	$	1,615
Provision for credit losses	22			4			2			—		—		28
Noninterest income	442			85			216			49		12		804
Noninterest expenses	777			533			275			5		130		1,720
Provision (benefit) for income taxes	225			34			18			( 135 )		1		143
Net income (loss)	$	824		$	123		$	61		$	( 478 )	$	( 2 )	$	528
Net charge-offs	$	32		$	3		$	1		$	—	$	—	$	36
Selected Average Balances:
Assets	$	45,998		$	3,033		$	5,346		$	18,593	$	8,046	$	81,016
Loans	43,693			2,322			5,073			—		12		51,100
Deposits	31,845			24,400			3,898			3,661		283		64,087
Statistical Data:
Return on average assets (a)	2.40		%	0.66		%	1.53		%	n/m		n/m		0.87		%
Efficiency ratio (b)	42.07			76.47			77.32			n/m		n/m		71.08
Nine Months Ended September 30, 2023
Earnings Summary:
Net interest income (expense)	$	1,550		$	644		$	158		$	( 493 )	$	71	$	1,930
Provision (benefit) for credit losses	81			2			( 10 )			—		4		77
Noninterest income	460			89			233			93		5		880
Noninterest expenses	756			511			298			4		72		1,641
Provision (benefit) for income taxes	269			53			26			( 101 )		( 3 )		244
Net income (loss)	$	904		$	167		$	77		$	( 303 )	$	3	$	848
Net charge-offs	$	1		$	—		$	1		$	—	$	—	$	2
Selected Average Balances:
Assets	$	49,906		$	2,944		$	5,510		$	20,469	$	9,400	$	88,229
Loans	46,796			2,223			5,257			—		—		54,276
Deposits	33,204			24,394			4,200			3,858		353		66,009
Statistical Data:
Return on average assets (a)	2.42		%	0.89		%	1.92		%	n/m		n/m		1.29		%
Efficiency ratio (b)	37.64			69.23			75.68			n/m		n/m		58.26

(a) Return on average assets is calculated based on the greater of average assets or average liabilities and attributed equity.

n/m – not meaningful

Table of Contents

Notes to Consolidated Financial Statements (unaudited)

Comerica Incorporated and Subsidiaries

NOTE 15 - REVENUE FROM CONTRACTS WITH CUSTOMERS

Revenue from contracts with customers comprises the noninterest income earned by the Corporation in exchange for services provided to customers. The following table presents the composition of revenue from contracts with customers, segregated from other sources of noninterest income, by business segment.


	Commercial Bank		Retail Bank		Wealth Management		Finance & Other		Total
(in millions)
Three Months Ended September 30, 2024
Revenue from contracts with customers:
Card fees	$	53	$	10	$	1	$	—	$	64
Fiduciary income	—		—		57		—		57
Service charges on deposit accounts	31		13		2		—		46
Commercial loan servicing fees (a)	3		—		—		—		3
Capital markets income (b)	6		—		—		—		6
Brokerage fees	1		—		12		—		13
Other noninterest income (b)	—		( 1 )		2		1		2
Total revenue from contracts with customers	94		22		74		1		191
Other sources of noninterest income	55		2		( 1 )		30		86
Total noninterest income	$	149	$	24	$	73	$	31	$	277
Three Months Ended September 30, 2023
Revenue from contracts with customers:
Card fees	$	58	$	12	$	1	$	—	$	71
Fiduciary income	1		—		58		—		59
Service charges on deposit accounts	32		14		1		—		47
Commercial loan servicing fees (a)	3		—		—		—		3
Capital markets income (b)	4		—		—		—		4
Brokerage fees	—		—		8		( 2 )		6
Other noninterest income (b)	—		4		7		—		11
Total revenue from contracts with customers	98		30		75		( 2 )		201
Other sources of noninterest income	52		1		3		38		94
Total noninterest income	$	150	$	31	$	78	$	36	$	295
Nine Months Ended September 30, 2024
Revenue from contracts with customers:
Card fees	$	161	$	30	$	3	$	—	$	194
Fiduciary income	1		—		165		—		166
Service charges on deposit accounts	93		40		4		—		137
Commercial loan servicing fees (a)	7		—		—		—		7
Capital markets income (b)	18		—		—		—		18
Brokerage fees	1		—		36		—		37
Other noninterest income (b)	6		11		4		1		22
Total revenue from contracts with customers	287		81		212		1		581
Other sources of noninterest income	155		4		4		60		223
Total noninterest income	$	442	$	85	$	216	$	61	$	804
Nine Months Ended September 30, 2023
Revenue from contracts with customers:
Card fees	$	175	$	34	$	3	$	—	$	212
Fiduciary income	1		—		178		—		179
Service charges on deposit accounts	95		41		4		—		140
Commercial loan servicing fees (a)	9		—		—		—		9
Capital markets income (b)	12		—		—		—		12
Brokerage fees	—		—		24		( 2 )		22
Other noninterest income (b)	1		10		20		1		32
Total revenue from contracts with customers	293		85		229		( 1 )		606
Other sources of noninterest income	167		4		4		99		274
Total noninterest income	$	460	$	89	$	233	$	98	$	880

(a) Included in commercial lending fees on the Consolidated Statements of Comprehensive Income.

(b) Excludes derivative, warrant and other miscellaneous income.

Revenue from contracts with customers did not generate significant contract assets and liabilities for the periods presented.

Table of Contents

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

FORWARD-LOOKING STATEMENTS

This report includes forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. In addition, the Corporation may make other written and oral communications from time to time that contain such statements. All statements regarding the Corporation's expected financial position, strategies and growth prospects and general economic conditions expected to exist in the future are forward-looking statements. The words, "anticipates," "believes," "contemplates," "feels," "expects," "estimates," "enhances," "seeks," "strives," "plans," "intends," "outlook," "forecast," "position," "target," "mission," "assume," "achievable," "potential," "strategy," "goal," "aspiration," "opportunity," "initiative," "outcome," "continue," "remain," "maintain," "on track," "trend," "objective," "looks forward," "projects," "models," 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 the Corporation or its management, are intended to identify forward-looking statements. These forward-looking statements are predicated on the beliefs and assumptions of the Corporation's management based on information known to the Corporation's management as of the date of this report and do not purport to speak as of any other date. Forward-looking statements may include descriptions of plans and objectives of the Corporation's management for future or past operations, products or services and forecasts of the Corporation's revenue, earnings or other measures of economic performance, including statements of profitability, business segments and subsidiaries as well as estimates of credit trends and global stability. Such statements reflect the view of the Corporation'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, the Corporation's actual results could differ materially from those discussed. Factors that could cause or contribute to such differences include credit risks (changes in customer behavior; unfavorable developments concerning credit quality; and declines or other changes in the businesses or industries of the Corporation's customers); market risks (changes in monetary and fiscal policies; fluctuations in interest rates and their impact on deposit pricing; and transitions away from the Bloomberg Short Term Bank Yield Index towards new interest rate benchmarks); liquidity risks (the Corporation's ability to maintain adequate sources of funding and liquidity; reductions in the Corporation's credit rating; and the interdependence of financial service companies and their soundness); technology risks (cybersecurity risks and heightened legislative and regulatory focus on cybersecurity and data privacy); operational risks (operational, systems or infrastructure failures; reliance on other companies to provide certain key components of business infrastructure; the impact of legal and regulatory proceedings or determinations; losses due to fraud; and controls and procedures failures); compliance risks (changes in regulation or oversight, or changes in the Corporation’s status with respect to existing regulations or oversight; the effects of stringent capital requirements; and the impacts of future legislative, administrative or judicial changes to tax regulations); strategic risks (damage to the Corporation's reputation; the Corporation's ability to utilize technology to efficiently and effectively develop, market and deliver new products and services; competitive product and pricing pressures among financial institutions within the Corporation's markets; the implementation of the Corporation's strategies and business initiatives; management's ability to maintain and expand customer relationships; management's ability to retain key officers and employees; and any future strategic acquisitions or divestitures); and other general risks (changes in general economic, political or industry conditions; negative effects from inflation; the effectiveness of methods of reducing risk exposures; the effects of catastrophic events, including pandemics; physical or transition risks related to climate change; changes in accounting standards; the critical nature of the Corporation's accounting policies, processes and management estimates; the volatility of the Corporation's stock price; and that an investment in the Corporation's equity securities is not insured or guaranteed by the FDIC). The Corporation cautions that the foregoing list of factors is not all-inclusive. 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 14 of the Corporation's 2023 Annual Report on Form 10-K for the year ended December 31, 2023. Forward-looking statements speak only as of the date they are made. The Corporation 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 report or in any documents, the Corporation claims the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995.

Table of Contents

RESULTS OF OPERATIONS

In accordance with Item 303(c) of Regulation S-K, the Corporation is providing a comparison of the quarter ended September 30, 2024 against the preceding sequential quarter. The Corporation believes providing a sequential discussion of its results of operations provides more relevant information for investors and stakeholders to understand and analyze the business. Balance sheet items are discussed in terms of average balances unless otherwise noted.

Three Months Ended September 30, 2024 Compared to Three Months Ended June 30, 2024


	Three Months Ended
(dollar amounts in millions, except per share data)	September 30, 2024		June 30, 2024
Net interest income	$	534	$	533
Provision for credit losses	14		—
Noninterest income	277		291
Noninterest expenses	562		555
Income before income taxes	235		269
Provision for income taxes	51		63
Net income	$	184	$	206
Diluted earnings per common share	$	1.33	$	1.49

Net income for the three months ended September 30, 2024 was $184 million, a decrease of $22 million compared to $206 million for the three months ended June 30, 2024, driven by a $14 million increase in provision for credit losses, a $14 million decrease in noninterest income and a $7 million increase in noninterest expenses. Provision for income taxes decreased $12 million, reflecting lower pre-tax income. Net income per diluted common share was $1.33 and $1.49 for the three months ended September 30, 2024 and June 30, 2024, respectively, a decrease of $0.16 per diluted common share.

Table of Contents

Analysis of Net Interest Income


	Three Months Ended
	September 30, 2024						June 30, 2024
(dollar amounts in millions)	Average Balance		Interest		Average Rate		Average Balance		Interest		Average Rate
Commercial loans (a)	$	26,173	$	341	5.18	%	$	26,292	$	346	5.29	%
Real estate construction loans	4,205		89		8.43		4,553		95		8.43
Commercial mortgage loans	14,494		272		7.44		14,171		263		7.47
Lease financing	804		12		6.10		798		13		6.20
International loans	1,036		20		7.73		1,111		22		8.02
Residential mortgage loans	1,905		19		3.94		1,898		18		3.83
Consumer loans	2,244		45		8.04		2,248		46		8.24
Total loans (b)	50,861		798		6.24		51,071		803		6.32
Mortgage-backed securities (c)	14,608		98		2.29		14,290		99		2.29
U.S. Treasury securities (d)	1,272		1		0.50		1,460		2		0.39
Total investment securities	15,880		99		2.17		15,750		101		2.14
Interest-bearing deposits with banks (e)	5,969		81		5.32		4,642		64		5.40
Other short-term investments	393		4		3.83		366		3		3.99
Total earning assets	73,103		982		5.17		71,829		971		5.20
Cash and due from banks	593						603
Allowance for loan losses	(686)						(691)
Accrued income and other assets	7,221						7,466
Total assets	$	80,231					$	79,207
Money market and interest-bearing checking deposits (f)	$	30,960	260		3.34		$	29,080	236		3.24
Savings deposits	2,194		1		0.19		2,287		2		0.22
Customer certificates of deposit	3,625		31		3.39		3,901		36		3.67
Other time deposits	2,739		37		5.35		2,403		31		5.28
Foreign office time deposits	21		1		4.38		27		—		4.42
Total interest-bearing deposits	39,539		330		3.31		37,698		305		3.23
Federal funds purchased	—		—		—		—		—		—
Other short-term borrowings	77		1		5.65		666		9		5.63

Medium- and long-term debt	6,849		117		6.87		7,082		124		6.98
Total interest-bearing sources	46,465		448		3.84		45,446		438		3.85
Noninterest-bearing deposits	24,357						25,357
Accrued expenses and other liabilities	2,469						2,556
Shareholders’ equity	6,940						5,848
Total liabilities and shareholders’ equity	$	80,231					$	79,207
Net interest income/rate spread			$	534	1.33				$	533	1.35
Impact of net noninterest-bearing sources of funds					1.47						1.51
Net interest margin (as a percentage of average earning assets)					2.80	%					2.86	%

(a) Interest income on commercial loans included net expense from cash flow swaps of $178 million and $174 million for the three months ended September 30, 2024 and June 30, 2024, respectively.

(b) Nonaccrual loans are included in average balances reported and in the calculation of average rates.

(c) Average balances included $2.4 billion and $3.1 billion of unrealized losses for the three months ended September 30, 2024 and June 30, 2024, respectively; yields calculated gross of these unrealized losses.

(d) Average balances included $38 million and $58 million of unrealized losses for the three months ended September 30, 2024 and June 30, 2024, respectively; yields calculated gross of these unrealized losses.

(e) Average balances included $13 million and excluded $8 million of collateral posted and netted against derivative liability positions for the three months ended September 30, 2024 and June 30, 2024, respectively; yields calculated gross of derivative netting amounts.

(f) Average balances excluded $72 million and $121 million of collateral received and netted against derivative asset positions for the three months ended September 30, 2024 and June 30, 2024, respectively; rates calculated gross of derivative netting amounts.

Table of Contents

Rate/Volume Analysis


	Three Months Ended
	September 30, 2024/June 30, 2024
(in millions)	Increase (Decrease) Due to Rate (a)		(Decrease) Increase Due to Volume (a)		Net (Decrease) Increase
Interest Income:
Loans	$	—	$	(5)	$	(5)
Investment securities	—		(2)		(2)
Interest-bearing deposits with banks	—		17		17
Other short-term investments	—		1		1
Total interest income	—		11		11
Interest Expense:
Interest-bearing deposits	9		16		25
Short-term borrowings	1		(9)		(8)
Medium- and long-term debt	(2)		(5)		(7)
Total interest expense	8		2		10
Net interest income	$	(8)	$	9	$	1

(a) Impact of additional days, other portfolio dynamics and interest rate swaps reflected as part of rate impact, rate/volume variances are allocated to variances due to volume.

Net interest income increased $1 million to $534 million for the three months ended September 30, 2024, compared to $533 million for the three months ended June 30, 2024, while net interest margin decreased 6 basis points to 2.80 percent during the same period. Net interest income was impacted by an increase of $1.3 billion in deposits held with the Federal Reserve Bank (FRB), declines of $589 million in short-term borrowings and $233 million in medium- and long-term debt and the impact of one additional day in the quarter, offset by a $1.8 billion increase in interest-bearing deposits, the net impact of lower short-term rates, lower nonaccrual loan interest and a $210 million decline in loan volume. The decrease in net interest margin reflected higher interest-bearing deposit costs and lower nonaccrual interest, partially offset by higher deposits held with the FRB and the decline in debt balances.

For further discussion of the effects of market rates on net interest income, refer to the "Market and Liquidity Risk" section of this financial review.

Provision for Credit Losses

The provision for credit losses, which includes the provision for loan losses and the provision for credit losses on lending-related commitments, was $14 million for the three months ended September 30, 2024, compared to no provision in the previous quarter. The allowance for credit losses increased $3 million to $720 million at September 30, 2024, compared to $717 million at June 30, 2024, reflecting changes in loan portfolio composition and a relatively consistent economic outlook. As a percentage of total loans, the allowance for credit losses increased 5 basis points to 1.43% at September 30, 2024, compared to 1.38% at June 30, 2024. Net loan charge-offs were $11 million for both three-month periods, reflecting improvements in Corporate Banking and Mortgage Banker Finance, offset by a decline in Energy net recoveries. The provision for credit losses on lending-related commitments was an expense of $3 million for the three months ended September 30, 2024, compared to a benefit of $6 million for the three months ended June 30, 2024.

An analysis of the allowance for credit losses and a summary of nonperforming assets are presented under the "Credit Risk" subheading in the "Risk Management" section of this financial review.

Table of Contents

Noninterest Income


	Three Months Ended
(in millions)	September 30, 2024		June 30, 2024
Card fees	$	64	$	64
Fiduciary income	57		58
Service charges on deposit accounts	46		46
Capital markets income	39		37
Commercial lending fees	17		17
Brokerage fees	13		14
Bank-owned life insurance	12		11
Letter of credit fees	10		10
Risk management hedging income	7		17
Other noninterest income (a)	12		17
Total noninterest income	$	277	$	291

(a) The table below provides further details on certain categories included in other noninterest income.

Noninterest income decreased $14 million to $277 million for the three months ended September 30, 2024, driven by a decrease in risk management hedging income mostly from lower price alignment income due to changes in cash balances held with the Chicago Mercantile Exchange (CME), as well as a loss on a derivative related to Visa's Class B shares, partially offset by increases in deferred compensation asset returns (offset in noninterest expenses) and capital markets income, as well as smaller increases in other categories. The decrease in cash balances held with the CME resulted in an increase in FRB deposits (reported within interest-bearing deposits with banks), which resulted in a corresponding increase to interest income. Other noninterest income is detailed in the table below.


	Three Months Ended
(in millions)	September 30, 2024		June 30, 2024
FHLB and FRB stock dividends	$	4	$	4
Deferred compensation asset returns (a)	4		1


All other noninterest income (b)	4		12
Other noninterest income	$	12	$	17

(a) Compensation deferred by the Corporation's officers and directors is invested based on investment selections of the officers and directors. Income earned on these assets is reported in other noninterest income and the corresponding change in deferred compensation plan liabilities is reported in salaries and benefits expense.

(b) The three months ended September 30, 2024 included a $5 million loss, while the three months ended June 30, 2024 included a $6 million gain, both pertaining to a derivative related to Visa's Class B shares.

Noninterest Expenses


	Three Months Ended
(in millions)	September 30, 2024		June 30, 2024
Salaries and benefits expense	$	335	$	323
Outside processing fee expense	69		68
Software expense	46		45
Occupancy expense	46		44
Equipment expense	13		13
FDIC insurance expense	11		19
Advertising expense	10		12
Other noninterest expenses	32		31
Total noninterest expenses	$	562	$	555

Noninterest expenses increased $7 million to $562 million, primarily due to increased salaries and benefits expense, partially offset by a decrease in FDIC insurance expense (mostly driven by changes to the special assessment estimates by the FDIC). Salaries and benefits expense included increases in deferred compensation asset returns (mostly offset in other noninterest income) and staff additions, as well as impacts from an additional day in the quarter, higher incentive compensation and stock-based compensation. Other noninterest expenses included an increase in operational losses, partially offset by a decrease in consulting expenses.

Table of Contents

Nine Months Ended September 30, 2024 Compared to Nine Months Ended September 30, 2023


	Nine Months Ended September 30,
(dollar amounts in millions, except per share data)	2024		2023
Net interest income	$	1,615	$	1,930
Provision for credit losses	28		77
Noninterest income	804		880
Noninterest expenses	1,720		1,641
Income before income taxes	671		1,092
Provision for income taxes	143		244
Net income	$	528	$	848
Diluted earnings per common share	$	3.80	$	6.24

Net income decreased $320 million to $528 million for the nine months ended September 30, 2024, compared to $848 million for the nine months ended September 30, 2023, driven by a decline in net interest income, higher noninterest expenses and lower noninterest income, partially offset by a decline in provision for credit losses. The decrease in net interest income was primarily due to lower loan volumes, higher interest-bearing deposit balances and the net impact of higher short-term rates, partially offset by a decline in FHLB advances. Net income per diluted common share decreased $2.44 to $3.80 for the nine months ended September 30, 2024, compared to $6.24 for the nine months ended September 30, 2023.

Table of Contents

Analysis of Net Interest Income


	Nine Months Ended
	September 30, 2024						September 30, 2023
(dollar amounts in millions)	Average Balance		Interest		Average Rate		Average Balance		Interest		Average Rate
Commercial loans (a)	$	26,305	$	1,035	5.26	%	$	30,631	$	1,263	5.52	%
Real estate construction loans	4,642		292		8.41		3,786		228		8.05
Commercial mortgage loans	14,104		788		7.46		13,694		723		7.06
Lease financing (b)	804		37		6.14		770		25		4.24
International loans	1,096		64		7.85		1,245		73		7.89
Residential mortgage loans	1,895		55		3.84		1,869		49		3.47
Consumer loans	2,254		138		8.20		2,281		130		7.65
Total loans (c)	51,100		2,409		6.30		54,276		2,491		6.14
Mortgage-backed securities (d)	14,560		298		2.29		15,865		318		2.28
U.S. Treasury securities (e)	1,425		4		0.38		1,966		8		0.53
Total investment securities	15,985		302		2.14		17,831		326		2.10
Interest-bearing deposits with banks (f)	6,112		250		5.45		7,815		300		5.14
Other short-term investments	381		11		3.94		319		9		3.57
Total earning assets	73,578		2,972		5.19		80,241		3,126		5.03
Cash and due from banks	711						1,251
Allowance for loan losses	(688)						(646)
Accrued income and other assets	7,415						7,383
Total assets	$	81,016					$	88,229
Money market and interest-bearing checking deposits (g)	$	29,585	724		3.26		$	25,519	419		2.18
Savings deposits	2,277		4		0.21		2,886		5		0.20
Customer certificates of deposit	3,797		103		3.61		2,414		42		2.35
Other time deposits	3,035		120		5.30		3,247		123		5.08
Foreign office time deposits	22		1		4.39		27		1		3.90
Total interest-bearing deposits	38,716		952		3.28		34,093		590		2.30
Federal funds purchased	9		—		5.39		34		1		4.68
Other short-term borrowings	1,095		47		5.65		8,268		332		5.37

Medium- and long-term debt	6,944		358		6.87		5,772		273		6.31
Total interest-bearing sources	46,764		1,357		3.86		48,167		1,196		3.30
Noninterest-bearing deposits	25,371						31,916
Accrued expenses and other liabilities	2,588						2,466
Shareholders’ equity	6,293						5,680
Total liabilities and shareholders’ equity	$	81,016					$	88,229
Net interest income/rate spread			$	1,615	1.33				$	1,930	1.73
Impact of net noninterest-bearing sources of funds					1.49						1.38
Net interest margin (as a percentage of average earning assets)					2.82	%					3.11	%

(a) Interest income on commercial loans included net expense from cash flow swaps of $522 million and $432 million for the nine months ended September 30, 2024 and 2023, respectively.

(b) The nine months ended September 30, 2023 included residual value adjustments totaling $7 million, which impacted the average yield on loans by 3 basis points.

(d) Average balances included $2.8 billion of unrealized losses for both the nine months ended September 30, 2024 and 2023; yields calculated gross of these unrealized losses.

(e) Average balances included $55 million and $122 million of unrealized losses for the nine months ended September 30, 2024 and 2023, respectively; yields calculated gross of these unrealized losses.

(f) Average balances included $2 million of collateral posted and netted against derivative liability positions for both the nine months ended September 30, 2024 and 2023; yields calculated gross of derivative netting amounts.

(g) Average balances excluded $108 million and $213 million of collateral received and netted against derivative asset positions for the nine months ended September 30, 2024 and 2023, rates calculated gross of derivative netting amounts.

Table of Contents

Rate/Volume Analysis


	Nine Months Ended
	September 30, 2024/September 30, 2023
(in millions)	Increase (Decrease) Due to Rate (a)		(Decrease) Increase Due to Volume (a)		Net (Decrease) Increase
Interest Income:
Loans	$	101	$	(183)	$	(82)
Investment securities	(3)		(21)		(24)
Interest-bearing deposits with banks	17		(67)		(50)
Other short-term investments	1		1		2
Total interest income	116		(270)		(154)
Interest Expense:
Interest-bearing deposits	206		156		362
Short-term borrowings	24		(310)		(286)
Medium- and long-term debt	43		42		85
Total interest expense	273		(112)		161
Net interest income	$	(157)	$	(158)	$	(315)

(a) Impact of additional days, other portfolio dynamics and interest rate swaps reflected as part of rate impact, rate/volume variances are allocated to variances due to volume.

Net interest income decreased $315 million, and net interest margin decreased 29 basis points, driven by a $3.2 billion decline in loan balances, a $4.6 billion increase in interest-bearing deposits and the net impact of higher short-term rates, partially offset by a $7.2 billion decrease in short-term FHLB advances. For further discussion of the effects of market rates on net interest income, refer to the "Market and Liquidity Risk" section of this financial review.

Provision for Credit Losses

The provision for credit losses decreased $49 million to $28 million for the nine months ended September 30, 2024, compared to $77 million for the nine months ended September 30, 2023, reflecting changes in portfolio composition, lower loan balances and an improved economic outlook. Net loan charge-offs were $36 million for the nine months ended September 30, 2024, compared to $2 million for the nine months ended September 30, 2023, driven by general Middle Market, partially offset by improvements in Energy and Technology and Life Sciences. An analysis of the allowance for credit losses and nonperforming assets is presented under the "Credit Risk" subheading in the "Risk Management" section of this financial review.

Noninterest Income


	Nine Months Ended September 30,
(in millions)	2024		2023
Card fees	$	194	$	212
Fiduciary income (a)	166		179
Service charges on deposit accounts	137		140
Capital markets income	106		113
Commercial lending fees	50		55
Brokerage fees (a)	37		22
Bank-owned life insurance	33		36
Letter of credit fees	30		31

Risk management hedging (loss) income	(1)		32
Other noninterest income (a), (b)	52		60
Total noninterest income	$	804	$	880

(a) Results for the 2024 period include changes in presentation consistent with contractual terms with new investment program partner beginning in November 2023 resulting in a net $13 million increase to brokerage fees with corresponding decreases of $17 million in commission costs (recorded within salaries and benefits expense), $16 million in other noninterest income and $14 million in fiduciary income.

(b) The table below provides further details on certain categories included in other noninterest income.

Table of Contents

Noninterest income decreased $76 million to $804 million, driven by a decrease in risk management hedging income, which included $39 million in losses related to BSBY cessation, partially offset by an increase in price alignment income received for centrally cleared derivative positions, as well as declines in card fees (mostly government card interchange fees) and fiduciary income, partially offset by an increase in brokerage fees. Other noninterest income for the 2024 period included a $5 million negotiated vendor payment, while other noninterest income for the 2023 period was reduced by $5 million in losses on assets held for sale.

The following table presents certain categories included in other noninterest income on the Consolidated Statements of Comprehensive Income.


	Nine Months Ended September 30,
(in millions)	2024		2023
FHLB and FRB stock dividends	$	13	$	24
Deferred compensation asset returns (a)	11		5
Securities trading income	—		12
Insurance commissions	—		10
All other noninterest income	28		9
Other noninterest income	$	52	$	60

Noninterest Expenses


	Nine Months Ended September 30,
(in millions)	2024		2023
Salaries and benefits expense	$	1,006	$	947
Outside processing fee expense	205		207
Software expense	135		127
Occupancy expense	134		126
FDIC insurance expense	66		48
Equipment expense	38		36
Advertising expense	30		30
Other noninterest expenses	106		120
Total noninterest expenses	$	1,720	$	1,641

Noninterest expenses increased $79 million to $1.7 billion, due to increases in salaries and benefits expense, FDIC insurance expense (related to special assessment), software expense and occupancy expense, partially offset by a decline in other noninterest expenses. The increase in salaries and benefits expense reflected the impact of annual merit-based salary increases and staff additions, as well as increases in deferred compensation expense (mostly offset in other noninterest income), staff insurance and payroll taxes, partially offset by lower severance costs. Other noninterest expenses included decreases in litigation-related expenses and non-salary pension expense, as well as a contract termination cost recorded in the 2023 period, partially offset by gains on the sale of real estate recorded in the 2023 period.

STRATEGIC LINES OF BUSINESS

The Corporation's management accounting system assigns balance sheet and income statement items to each segment using certain methodologies, which are regularly reviewed and refined. These methodologies may be modified as the management accounting system is enhanced and changes occur in the organizational structure and/or product lines. Note 22 to the consolidated financial statements in the Corporation's 2023 Annual Report describes the Corporation's segment reporting methodology.

Table of Contents

Net interest income for each segment reflects the interest income generated by earning assets less interest expense on interest-bearing liabilities plus the net impact from associated internal funds transfer pricing (FTP) funding credits and charges. The FTP methodology allocates credits to each business segment for deposits and other funds provided as well as charges for loans and other assets being funded. FTP crediting rates on deposits and other funds provided reflect the long-term value of deposits and other funding sources based on their implied maturities. Due to the longer-term nature of implied maturities, FTP crediting rates are generally less volatile than changes in interest rates observed in the market. FTP charge rates for funding loans and other assets reflect a matched cost of funds based on the pricing and duration characteristics of the assets. As a result of applying matched funding, interest revenue for each segment resulting from loans and other assets is generally not impacted by changes in interest rates. Therefore, net interest income for each segment primarily reflects the volume of loans and other earning assets at the spread over the matched cost of funds, as well as the volume of deposits at the associated FTP crediting rates. Generally, in periods of rising interest rates, FTP charge rates for funding loans and FTP crediting rates on deposits will increase, with FTP crediting rates for deposits typically repricing at a slower pace than FTP charge rates for funding loans. Conversely, in periods of declining interest rates, FTP charge rates for funding loans and FTP crediting rates on deposits will decrease, with FTP crediting rates for deposits typically repricing at a slower pace than FTP charge rates for funding loans.

Business Segments

The following sections present a summary of the performance of each of the Corporation's business segments for the nine months ended September 30, 2024 compared to the same period in the prior year.

Commercial Bank


	Nine Months Ended September 30,						Percent Change
(dollar amounts in millions)	2024		2023		Change
Earnings summary:
Net interest income	$	1,406	$	1,550	$	(144)	(9)	%
Provision for credit losses	22		81		(59)		(73)
Noninterest income	442		460		(18)		(4)
Noninterest expenses	777		756		21		3
Provision for income taxes	225		269		(44)		(17)
Net income	$	824	$	904	$	(80)	(9)	%
Net charge-offs	$	32	$	1	$	31	n/m

Selected average balances:
Loans	$	43,693	$	46,796	$	(3,103)	(7)	%
Deposits	31,845		33,204		(1,359)		(4)

n/m - not meaningful

Average loans decreased $3.1 billion, and included decreases in Equity Fund Services and general Middle Market, as well as Mortgage Banker Finance due to the exit from this line of business, partially offset by an increase in Commercial Real Estate. Average deposits decreased $1.4 billion, primarily driven by lower noninterest-bearing deposits, with the largest declines in Technology and Life Sciences, Energy and Mortgage Banker Finance.

The Commercial Bank's net income decreased $80 million to $824 million. Net interest income decreased $144 million due to higher interest expense on deposits and higher allocated net FTP charges. The provision for credit losses decreased $59 million, reflecting changes in portfolio composition, lower loan balances and an improved economic outlook. Net charge-offs increased $31 million to $32 million, driven by general Middle Market, partially offset by improvements in Energy and Technology and Life Sciences. Noninterest income decreased $18 million primarily due to lower capital markets income and card fees, partially offset by a $5 million negotiated vendor payment recorded in the first quarter of 2024. Noninterest expenses increased $21 million, primarily reflecting increases in salaries and benefits expense and FDIC insurance expense (related to special assessment), partially offset by lower operational losses and litigation and regulatory-related expenses.

Table of Contents

Retail Bank


	Nine Months Ended September 30,						Percent Change
(dollar amounts in millions)	2024		2023		Change
Earnings summary:
Net interest income	$	609	$	644	$	(35)	(5)	%
Provision for credit losses	4		2		2		n/m
Noninterest income	85		89		(4)		(3)
Noninterest expenses	533		511		22		4
Provision for income taxes	34		53		(19)		(35)
Net income	$	123	$	167	$	(44)	(26)	%
Net charge-offs	$	3	$	—	$	3	n/m

Selected average balances:
Loans	$	2,322	$	2,223	$	99	4	%
Deposits	24,400		24,394		6		—

n/m - not meaningful

Average loans increased $99 million, while average deposits increased $6 million. The Retail Bank's net income decreased $44 million to $123 million. Net interest income decreased $35 million, primarily due to higher interest expense on deposits, partially offset by higher FTP crediting rates on deposits. Noninterest income was relatively stable, while noninterest expenses increased $22 million, primarily due to increases in FDIC insurance expense (related to special assessment) and occupancy expense.

Wealth Management


	Nine Months Ended September 30,						Percent Change
(dollar amounts in millions)	2024		2023		Change
Earnings summary:
Net interest income	$	140	$	158	$	(18)	(12)	%
Provision for credit losses	2		(10)		12		n/m
Noninterest income	216		233		(17)		(7)
Noninterest expenses	275		298		(23)		(7)
Provision for income taxes	18		26		(8)		(29)
Net income	$	61	$	77	$	(16)	(23)	%
Net charge-offs	$	1	$	1	$	—	—

Selected average balances:
Loans	$	5,073	$	5,257	$	(184)	(3)	%
Deposits	3,898		4,200		(302)		(7)

n/m - not meaningful

Average loans decreased $184 million, while average deposits decreased $302 million, primarily reflecting a decrease in noninterest-bearing deposits. Wealth Management's net income decreased $16 million to $61 million. Net interest income decreased $18 million, primarily due to higher interest expense on deposits and higher allocated net FTP charges, partially offset by an increase in loan income. Noninterest income decreased $17 million, primarily driven by lower investment fees and insurance commissions, while noninterest expenses decreased $23 million, reflecting lower salaries and benefits expense (related to November 2023 change in presentation consistent with contractual terms with new investment program partner resulting in a net decrease to commission costs, with the offset recorded in noninterest income) and litigation and regulatory-related expenses, partially offset by higher operational losses and outside processing fee expense.

Table of Contents

Finance & Other


	Nine Months Ended September 30,						Percent Change
(dollar amounts in millions)	2024		2023		Change
Earnings summary:
Net interest expense	$	(540)	$	(422)	$	(118)	28	%
Provision for credit losses	—		4		(4)		(100)
Noninterest income	61		98		(37)		(38)
Noninterest expenses	135		76		59		78
Benefit for income taxes	(134)		(104)		(30)		29
Net loss	$	(480)	$	(300)	$	(180)	60	%


Selected average balances:
Loans	$	12	$	—	$	12	n/m
Deposits	3,944		4,211		(267)		(6)%

n/m - not meaningful

Average deposits, which primarily consist of centrally-managed brokered time deposits fully insured by the FDIC, decreased $267 million. Net loss for the Finance and Other category increased $180 million to $480 million. Net interest expense increased $118 million, reflecting the impact of interest rate swaps (which are centrally managed) as well as increased balances from higher-cost funding sources. Noninterest income decreased $37 million primarily due to risk management hedging losses related to BSBY cessation, partially offset by an increase in price alignment income received for centrally cleared derivative positions. Noninterest expenses increased $59 million, reflecting increases in salaries and benefits expense and consulting fees, as well as gains recorded on the sale of real estate in the 2023 period, partially offset by an improvement in non-salary pension expense.

The following table lists the Corporation's banking centers by geographic market.


	September 30,
	2024	2023
Michigan	159	176
Texas	113	115
California	88	92
Other Markets	20	25



Total	380	408

FINANCIAL CONDITION

Third Quarter 2024 Compared to Fourth Quarter 2023

Period-End Balances

Total assets decreased $6.2 billion to $79.7 billion, reflecting decreases of $2.5 billion in interest-bearing deposits with banks (primarily with the Federal Reserve Bank), $1.6 billion in total loans and $1.0 billion in investment securities. The decline in total loans included decreases of $796 million in National Dealer Services, $473 million in Equity Fund Services, $273 million in Corporate Banking, $263 million in Wealth Management and $250 million in Mortgage Banker Finance, partially offset by increases of $498 million in Commercial Real Estate and $303 million in Environmental Services.

Total liabilities decreased $7.1 billion to $72.3 billion, reflecting decreases of $4.0 billion in noninterest-bearing deposits and $3.6 billion in short-term borrowings (FHLB advances), partially offset by increases of $580 million in medium- and long-term debt and $345 million in interest-bearing deposits. For additional information regarding deposits, refer to "Deposit Concentrations and Uninsured Deposits" under the "Market Risk" subheading in the "Risk Management" section of this financial review. Total shareholders' equity increased $960 million, primarily reflecting a decrease in accumulated unrealized losses on cash flow hedges and investment securities available-for-sale, as well as net income recorded during the period.

Table of Contents

Average Balances

Total assets decreased $3.9 billion to $80.2 billion, driven by decreases of $1.9 billion in total loans, $716 million in interest-bearing deposits with banks and $409 million in investment securities. The following table provides information about the change in the Corporation's average loan portfolio by loan type.


	Three Months Ended						Percent Change
(dollar amounts in millions)	September 30, 2024		December 31, 2023		Change

Commercial loans	$	26,173	$	28,163	$	(1,990)	(7)	%
Real estate construction loans	4,205		4,798		(593)		(12)
Commercial mortgage loans	14,494		13,706		788		6
Lease financing	804		794		10		1
International loans	1,036		1,169		(133)		(11)
Residential mortgage loans	1,905		1,902		3		—
Consumer loans	2,244		2,264		(20)		(1)
Total loans	$	50,861	$	52,796	$	(1,935)	(4	%)

The $1.9 billion decrease in loans was primarily driven by decreases of $744 million in Equity Fund Services, $550 million in Corporate Banking, $545 million in general Middle Market, $541 million in National Dealer Services and $311 million in Mortgage Banker Finance, partially offset by an increase of $752 million in Commercial Real Estate.

Total liabilities decreased $5.5 billion to $73.3 billion, primarily reflecting decreases of $3.9 billion in short-term borrowings and $3.5 billion in noninterest-bearing deposits, partially offset by increases of $1.3 billion in interest-bearing deposits and $779 million in medium- and long-term debt. The following table provides information about the change in the Corporations' average deposits and borrowed funds by type:


	Three Months Ended						Percent Change
(dollar amounts in millions)	September 30, 2024		December 31, 2023		Change
Noninterest-bearing deposits	$	24,357	$	27,814	$	(3,457)	(12)	%
Money market and interest-bearing checking deposits	30,960		27,644		3,316		12
Savings deposits	2,194		2,440		(246)		(10)
Customer certificates of deposit	3,625		3,577		48		1
Other time deposits	2,739		4,557		(1,818)		(40)
Foreign office time deposits	21		13		8		62
Total deposits	$	63,896	$	66,045	$	(2,149)	(3)	%
Short-term borrowings	77		4,002		(3,925)		(98)
Medium- and long-term debt	6,849		6,070		779		13
Total borrowed funds	$	6,926	$	10,072	$	(3,146)	(31)	%

Other time deposits, which consisted of brokered deposits, decreased $1.8 billion, while decreases of $318 million in Technology and Life Sciences, $284 million in general Middle Market and $143 million in Mortgage Banker Finance were partially offset by increases of $167 million in Equity Fund Services and $142 million in Entertainment.

Short-term borrowings decreased $3.9 billion to $77 million, reflecting a reduction in FHLB advances, while medium- and long-term debt increased $779 million to $6.8 billion, driven by the issuance of $1.0 billion in senior notes in January 2024, partially offset by a $500 million senior note maturity in July 2024.

Table of Contents

Capital

The following table presents a summary of changes in total shareholders' equity for the nine months ended September 30, 2024.


(in millions)
Balance at January 1, 2024			$	6,406
Cumulative effect of change in accounting principle (a)			(4)
Net income			528
Cash dividends declared on common stock			(283)
Cash dividends declared on preferred stock			(17)


Other comprehensive income, net of tax:
Investment securities	$	325
Cash flow hedges	364
Defined benefit and other postretirement plans	4
Total other comprehensive income, net of tax			693
Net issuance of common stock under employee stock plans			(2)
Share-based compensation			45

Balance at September 30, 2024			$	7,366

(a) Effective January 1, 2024, the Corporation adopted ASU 2023-02, which expanded the permitted use of the proportional amortization method to certain tax credit investments.

The following table summarizes the Corporation's repurchase activity during the nine months ended September 30, 2024.


(shares in thousands)	Total Number of Shares Purchased as Part of Publicly Announced Repurchase Plans or Programs	Remaining Share Repurchase Authorization (a)	Total Number of Shares Purchased (b)	Average Price Paid Per Share



Total first quarter 2024	—	4,997	19	$	50.95



Total second quarter 2024	—	4,997	2	54.32
July 2024	—	4,997	2	51.21
August 2024	—	4,997	—	—
September 2024	—	4,997	—	—
Total third quarter 2024	—	4,997	2	51.21




Total 2024 year-to-date	—	4,997	23	51.31

(a) Maximum number of shares that may be repurchased under the publicly announced plans or programs.

(b) Consists of approximately 23,000 shares purchased related to deferred compensation plans during the nine months ended September 30, 2024 and is not considered part of the Corporation's repurchase program.

On October 22, 2024, the Corporation resumed repurchasing its common shares under its previously established share repurchase program by entering into an accelerated share repurchase (“ASR”) agreement to repurchase $100 million of its common stock. Under the terms of the ASR agreement, the Corporation received an initial delivery of common shares representing approximately 80% of the expected total to be repurchased. Subject to certain adjustments pursuant to the ASR agreement, the final number of shares repurchased and delivered under the ASR agreement will be based on the volume weighted average share price of the Corporation's common stock during the term of the transaction, which is expected to be completed in the fourth quarter of 2024.

Since the inception of the share repurchase program in 2010, a total of 97.2 million shares have been authorized for repurchase. There is no expiration date for the share repurchase program, which may be effectuated through open market repurchases, privately negotiated transactions, structured repurchase agreements with third parties and/or otherwise, including utilizing Rule 10b5-1 plans. The timing and actual amount of additional share repurchases are subject to various factors, including the Corporation's earnings generation, capital needs to fund future loan growth and market conditions.

The Corporation has a long-term CET1 capital ratio target of approximately 10 percent with capital deployment. At September 30, 2024, the Corporation's estimated CET1 capital ratio was 11.97 percent, up from 11.09 percent at December 31, 2023.

Table of Contents

The following table presents the minimum ratios required.



Common equity tier 1 capital to risk-weighted assets	4.5	%
Tier 1 capital to risk-weighted assets	6.0
Total capital to risk-weighted assets	8.0
Capital conservation buffer (a)	2.5
Tier 1 capital to adjusted average assets (leverage ratio)	4.0

(a) In addition to the minimum risk-based capital requirements, the Corporation is required to maintain a minimum capital conservation buffer, in the form of common equity, in order to avoid restrictions on capital distributions and discretionary bonuses.

The Corporation's capital ratios exceeded minimum regulatory requirements as follows:


	September 30, 2024				December 31, 2023
(dollar amounts in millions)	Capital/Assets		Ratio		Capital/Assets		Ratio
Common equity tier 1 (a), (b)	$	8,684	11.97	%	$	8,414	11.09	%
Tier 1 risk-based (a), (b)	9,078		12.51		8,808		11.60
Total risk-based (a)	10,375		14.30		10,263		13.52
Leverage (a)	9,078		11.02		8,808		10.06
Common shareholders' equity	6,972		8.75		6,012		7.00
Tangible common equity (b)	6,331		8.01		5,369		6.30
Risk-weighted assets (a)	72,576				75,901

(a) September 30, 2024 capital, risk-weighted assets and ratios are estimated.

(b) See Supplemental Financial Data section for reconciliations of non-GAAP financial measures and regulatory ratios.

Common shareholders’ equity included $2.4 billion in accumulated other comprehensive losses, with approximately $2.0 billion of those losses relating to balances recorded in total assets, comprised of valuation adjustments to available-for-sale securities and pension assets, as well as related deferred tax assets. These amounts impacted the common shareholders’ equity ratio by 267 basis points; the impact on the tangible common equity ratio using the same calculation method was 271 basis points. Average common shareholders' equity and return on average common shareholders' equity for the three months ended September 30, 2024 was $6.5 billion and 10.88%, respectively, compared to $4.9 billion and 2.17%, respectively, for the three months ended December 31, 2023.

Basel III Endgame Framework

On July 27, 2023, the federal banking agencies issued a notice of proposed rulemaking, commonly referred to as Basel III Endgame (the Capital Proposal) that would significantly increase the capital requirements applicable to large banking organizations with total assets of $100 billion or more. The Capital Proposal would align the regulatory capital calculation and the calculation of risk-weighted assets across large banking organizations subject to the Capital Proposal and require Category III and IV banking organizations to include most components of AOCI, including net unrealized gains and losses on available-for-sale securities, in their regulatory capital ratios. The Capital Proposal was subject to a public comment period, which ended on January 16, 2024. If adopted as proposed, the Capital Proposal would include a three-year transition period beginning July 1, 2025. As of September 30, 2024, the Corporation had total assets of $79.7 billion. While the Capital Proposal would not apply to the Corporation as it is currently proposed, if the Corporation becomes subject to the requirements of the Capital Proposal in the future or becomes subject to any other new laws or regulations related to capital and liquidity, such requirements could limit the Corporation’s ability to pay dividends or make share repurchases or require Comerica to reduce business levels or to raise capital, which would have a material adverse effect on the Corporation’s financial condition and results of operations. If subject to the Capital Proposal, the estimated impact related to proposed inclusion of most components of AOCI would be an approximate 285 basis point decrease to common equity tier-1 capital based on September 30, 2024 financials.

RISK MANAGEMENT

The following updated information should be read in conjunction with the "Risk Management" section on pages F-18 through F-34 in the Corporation's 2023 Annual Report.

Credit Risk

Allowance for Credit Losses

The allowance for credit losses includes both the allowance for loan losses and the allowance for credit losses on lending-related commitments. The allowance for credit losses decreased $8 million from $728 million at December 31, 2023 to $720 million at September 30, 2024.

Table of Contents

The following table presents metrics of the allowance for credit losses and nonperforming loans.


	September 30, 2024		December 31, 2023
Allowance for credit losses as a percentage of total loans	1.43	%	1.40	%

Allowance for credit losses as a multiple of total nonperforming loans	2.9x		4.1x

The economic forecasts informing the current expected credit loss (CECL) model reflects the FRB's pivot to monetary policy recalibration and lower interest rates, consumer spending growth moderation and slower, albeit continued, growth of the real economy. Inflation is gradually moderating as a modest margin of slack capacity opens in the labor market. Energy prices are projected to level off despite continued crosswinds from the Russia-Ukraine and Mideast wars, as U.S. crude production holds near a record high. Residential real estate property prices are expected to rise at more moderate rates, while commercial real estate prices face headwinds, both reflecting the long and variable lags of the FRB's tighter monetary policy prior to the beginning of rate cuts in the third quarter of 2024.

Downside risks to growth from geopolitical risks, cost-of-living pressures on household finances and less expansionary fiscal policy are projected to collectively contribute to slower growth in 2024 and 2025. Reduced demand for office space and subdued economic activity in the central business districts of major metro areas persist as drags on the broader economy. The FRB's gradual rate cuts driven by a softening labor market and disinflation aim to contain the risk of recession.

These factors shaped the 2-year reasonable and supportable forecasts used by the Corporation in its CECL estimate at September 30, 2024. The U.S. economy is projected to grow at a below-trend rate through 2024 and 2025, before gradually normalizing to its trend growth rate. The unemployment rate is expected to hold below 5 percent and oil prices are expected to decline, while interest rate forecasts reflect market expectations and guidance from the FRB available during the third quarter of 2024. The following table summarizes select variables representative of the economic forecasts used to develop the CECL estimate at September 30, 2024.


Economic Variable			Base Forecast
Real Gross Domestic Product (GDP) growth			Growth slows to 1.3 percent in the fourth quarter 2024 before recovering to approximately 2.0 percent by the end of the forecast period.
Unemployment rate			Expected to hold at approximately 4.2 percent through fourth quarter 2025 followed by a modest decline in 2026 to 4.1 percent by the end of the forecast period.
Spread of Corporate BBB bond to 10-year Treasury bond			Spread widens to 2.1 percent during second half of 2025 before normalizing to approximately 2.0 percent by third quarter 2026.
Oil Prices			Prices generally decline from $77 per barrel to approximately $73 per barrel over the forecast period.

Due to the high level of uncertainty regarding assumptions used as inputs to the forecast, the Corporation evaluated a range of economic scenarios, including more benign and more severe economic forecasts. In a more severe scenario, real GDP is projected to contract through the second quarter 2025, subsequently recovering growth of 1.7 percent by the end of the forecast period. Oil prices fall to below $58 per barrel by first quarter 2026 followed by an increase to $63 per barrel by the end of the forecast period, while the unemployment rate remains elevated through the end of the forecast period. Selecting the more severe forecast would result in an increase in the quantitative calculation of allowance for credit losses of approximately $361 million as of September 30, 2024. However, factoring in model overlays and qualitative adjustments could result in a materially different estimate under a more severe scenario. The Corporation monitors evolving economic conditions for impacts to the allowance for credit losses.

Allowance for Loan Losses

The allowance for loan losses represents management’s estimates of current expected credit losses in the Corporation’s loan portfolio. The allowance for loan losses, which totaled $686 million at September 30, 2024, was relatively stable compared to $688 million at December 31, 2023.

Collective loss estimates are determined by applying reserve factors, designed to estimate current expected credit losses, to amortized cost balances over the remaining contractual life of the collectively evaluated portfolio. Loans with similar risk characteristics are aggregated into homogeneous pools. The allowance for loan losses also includes qualitative adjustments to bring the allowance to the level management believes is appropriate based on factors that have not otherwise been fully accounted for, including adjustments for foresight risk, input imprecisions and model imprecision. Credit losses for loans that no longer share risk characteristics with the loan pools are estimated on an individual basis. Individual credit loss estimates are typically performed for nonaccrual loans and are based on one of several methods, including the estimated fair value of the underlying collateral, observable market value of similar debt or the present value of expected cash flows.

Table of Contents

Allowance for Credit Losses on Lending-Related Commitments

The allowance for credit losses on lending-related commitments estimates current expected credit losses on collective pools of letters of credit and unused commitments to extend credit based on reserve factors, determined in a manner similar to business loans, multiplied by a probability of draw estimate based on historical experience and credit risk, applied to commitment amounts. The allowance for credit losses on lending-related commitments totaled $34 million and $40 million at September 30, 2024 and December 31, 2023.

For additional information regarding the allowance for credit losses, refer to the "Critical Accounting Estimates" section and pages F-51 through F-52 in Note 1 to the consolidated financial statements of the Corporation's 2023 Annual Report.

Nonperforming Assets

Nonperforming assets include loans on nonaccrual status and foreclosed assets. The following table presents a summary of nonperforming assets and past due loans.


(dollar amounts in millions)	September 30, 2024			December 31, 2023

















Total nonperforming loans and nonperforming assets	$	250		$	178




Nonperforming loans as a percentage of total loans	0.50		%	0.34		%

Nonperforming assets as a percentage of total loans and foreclosed property	0.50			0.34

Loans past due 90 days or more and still accruing	$	21		$	20

Nonperforming assets increased $72 million to $250 million at September 30, 2024, from $178 million at December 31, 2023, which included increases of $51 million in nonaccrual business loans and $21 million in nonaccrual retail loans. Nonperforming loans were 0.50 percent of total loans at September 30, 2024, compared to 0.34 percent at December 31, 2023. For further information regarding the composition of nonperforming loans, refer to Note 4 to the consolidated financial statements.

The following table presents a summary of changes in nonaccrual loans.


	Three Months Ended
(in millions)	September 30, 2024		June 30, 2024		March 31, 2024
Balance at beginning of period	$	226	$	217	$	178
Loans transferred to nonaccrual (a)	55		45		83
Nonaccrual loan gross charge-offs	(23)		(28)		(21)
Loans transferred to accrual status (a)	—		—		(2)
Nonaccrual loans sold	(14)		(2)		(12)
Payments/other (b)	6		(6)		(9)
Balance at end of period	$	250	$	226	$	217

(a) Based on an analysis of nonaccrual loans with book balances greater than $2 million.

(b) Includes net changes related to nonaccrual loans with balances less than or equal to $2 million, payments on nonaccrual loans with book balances greater than $2 million and transfers of nonaccrual loans to foreclosed property.

There were five borrowers with a balance greater than $2 million, totaling $55 million, transferred to nonaccrual status in third quarter 2024, compared to five borrowers totaling $45 million in second quarter 2024 and six borrowers totaling $83 million in first quarter 2024. For further information about the composition of loans transferred to nonaccrual during third quarter 2024, refer to the nonaccrual information by industry category table below.

The following table presents the composition of nonaccrual loans by balance and the related number of borrowers at September 30, 2024 and December 31, 2023.


	September 30, 2024			December 31, 2023
(dollar amounts in millions)	Number of Borrowers	Balance		Number of Borrowers	Balance
Under $2 million	469	$	60	457	$	50
$2 million - $5 million	13	50		11	35
$5 million - $10 million	4	31		5	35
$10 million - $25 million	6	109		4	58

Total	492	$	250	477	$	178

Table of Contents

The following table presents a summary of nonaccrual loans at September 30, 2024 as well as loans transferred to nonaccrual and net loan charge-offs (recoveries) for the three months ended September 30, 2024, based on North American Industry Classification System (NAICS) categories.


(dollar amounts in millions)	September 30, 2024				Three Months Ended September 30, 2024
	Nonaccrual Loans				Loans Transferred to Nonaccrual (a)				Net Loan Charge-Offs (Recoveries)
Industry Category
Health Care & Social Assistance	$	48	19	%	$	28	51	%	$	4
Real Estate & Home Builders	39		15		3		5		—
Residential Mortgage	36		14		8		14		—
Manufacturing	28		11		—		—		4
Retail Trade	24		10		3		7		2
Information & Communication	12		5		—		—		1
Utilities	12		5		13		23		—
Transportation & Warehousing	9		4		—		—		—
Arts, Entertainment & Recreation	5		2		—		—		—
Management of Companies and Enterprises	4		2		—		—		—
Wholesale Trade	3		1		—		—		—
Services	3		1		—		—		(1)

Finance and Insurance	—		—		—		—		(3)

Other (b)	27		11		—		—		4
Total	$	250	100	%	$	55	100	%	$	11

(a) Based on an analysis of nonaccrual loans with book balances greater than $2 million.

(b) Other category includes other industry categories with smaller impacts, as well as consumer, excluding residential mortgage and certain personal purpose nonaccrual loans and net charge-offs.

Loans past due 90 days or more and still accruing interest generally represent loans that are well-collateralized and in the process of collection. Loans past due 90 days or more was $21 million at September 30, 2024, compared to $20 million at December 31, 2023. Loans past due 30-89 days decreased $51 million to $147 million at September 30, 2024, compared to $198 million at December 31, 2023. Loans past due 30 days or more and still accruing interest as a percentage of total loans were 0.33 percent and 0.42 percent at September 30, 2024 and December 31, 2023, respectively. An aging analysis of loans included in Note 4 to the consolidated financial statements provides further information about the balances comprising past due loans.

The following table presents a summary of total criticized loans. The Corporation's criticized list is consistent with the Special Mention, Substandard and Doubtful categories defined by regulatory authorities. Criticized loans on nonaccrual status are individually subjected to quarterly credit quality reviews, and the Corporation may establish specific allowances for such loans. A table of loans by credit quality indicator included in Note 4 to the consolidated financial statements provides further information about the balances comprising total criticized loans. Criticized loans were relatively flat compared to June 30, 2024 and December 31, 2023.


(dollar amounts in millions)	September 30, 2024			June 30, 2024			December 31, 2023
Total criticized loans	$	2,417		$	2,430		$	2,405
As a percentage of total loans	4.8		%	4.7		%	4.6		%

Concentrations of Credit Risk

Concentrations of credit risk may exist when a number of borrowers are engaged in similar activities, or activities in the same geographic region, and have similar economic characteristics that would cause them to be similarly impacted by changes in economic or other conditions. The Corporation has concentrations of credit risk with the commercial real estate and automotive industries. All other industry concentrations, as defined by management, individually represented less than 10 percent of total loans at September 30, 2024.

Table of Contents

Commercial Real Estate Lending

At September 30, 2024, the Corporation's commercial real estate portfolio represented 37 percent of total loans. The following table summarizes the Corporation's commercial real estate loan portfolio by loan category.


	September 30, 2024						December 31, 2023
(in millions)	Commercial Real Estate business line (a)		Other (b)		Total		Commercial Real Estate business line (a)		Other (b)		Total
Real estate construction loans	$	3,571	$	288	$	3,859	$	4,570	$	513	$	5,083
Commercial mortgage loans	6,196		8,578		14,774		4,727		8,959		13,686
Total commercial real estate	$	9,767	$	8,866	$	18,633	$	9,297	$	9,472	$	18,769

(a) Primarily loans to real estate developers.

(b) Primarily loans secured by owner-occupied real estate.

The Corporation limits risk inherent in its commercial real estate lending activities by monitoring borrowers directly involved in the commercial real estate markets and adhering to conservative policies on loan-to-value ratios for such loans. Commercial real estate loans, consisting of real estate construction and commercial mortgage loans, totaled $18.6 billion at September 30, 2024. Commercial real estate loans made to borrowers in the Commercial Real Estate business line, which includes loans to real estate developers, totaled $9.8 billion, or 52 percent of total commercial real estate loans, an increase of $470 million compared to December 31, 2023. The Commercial Real Estate business line at September 30, 2024 was predominantly secured by multi-family and industrial properties, comprising 50% and 28% of the portfolio, respectively, with only 4% secured by office properties.

Commercial real estate loans in other business lines totaled $8.9 billion, or 48 percent of total commercial real estate loans, at September 30, 2024, a decrease of $606 million compared to December 31, 2023. These loans consisted primarily of owner-occupied commercial mortgages, which bear credit characteristics similar to non-commercial real estate business loans. Generally, loans previously reported as real estate construction are classified as commercial mortgage loans upon receipt of a certificate of occupancy.

The real estate construction loan portfolio primarily contains loans made to long-tenured customers with satisfactory completion experience. There were $36 million in criticized real estate construction loans in the Commercial Real Estate business line and $2 million in other business lines at September 30, 2024, compared to $86 million in the Commercial Real Estate business line and $12 million in other business lines at December 31, 2023.

For the three month periods ended September 30, 2024 and June 30, 2024, as well as the nine months ended September 30, 2024 and 2023, there were no net charge-offs of real estate construction loans.

Commercial mortgage loans are loans where the primary collateral is a lien on any real property and are primarily loans secured by owner-occupied real estate. Real property is generally considered primary collateral if the value of that collateral represents more than 50 percent of the commitment at loan approval. Loans in the commercial mortgage portfolio generally mature within three to five years. Criticized commercial mortgage loans in the Commercial Real Estate business line totaled $392 million and $378 million at September 30, 2024 and December 31, 2023, respectively. In other business lines, $556 million and $395 million of commercial mortgage loans were criticized at September 30, 2024 and December 31, 2023, respectively, with the increase primarily in senior housing properties, largely managed in the Corporate Banking line of business. Senior housing loans totaled $722 million at September 30, 2024, of which 44% were criticized, compared to $796 million at December 31, 2023, of which 11% were criticized.

Commercial mortgage net charge-offs were $9 million and $5 million for the three months ended September 30, 2024 and June 30, 2024, respectively. For the nine months ended September 30, 2024, commercial mortgage net charge-offs were $14 million, compared to none for the nine months ended September 30, 2023.

Table of Contents

Automotive Lending - Dealer

The following table presents a summary of automotive dealership loans.


	September 30, 2024				December 31, 2023
(in millions)	Loans Outstanding		Percent of Total Loans		Loans Outstanding		Percent of Total Loans
Dealer:
Floor plan	$	2,232			$	2,313
Other	3,163				3,878
Total dealer	$	5,395	10.7	%	$	6,191	11.9	%

Substantially all dealer loans are in the National Dealer Services business line and primarily include floor plan financing and other loans to automotive dealerships. Floor plan loans, included in commercial loans in the Consolidated Balance Sheets, totaled $2.2 billion at September 30, 2024, a decrease of $81 million compared to $2.3 billion at December 31, 2023. At September 30, 2024 and December 31, 2023, other loans to automotive dealers in the National Dealer Service business line totaled $3.2 billion and $3.9 billion, respectively, including $1.9 billion and $2.2 billion of owner-occupied commercial real estate mortgage loans, respectively.

There were no nonaccrual dealer loans at both September 30, 2024 and December 31, 2023. Additionally, there were no net charge-offs of dealer loans during the three months ended September 30, 2024 and June 30, 2024, or in the nine months ended September 30, 2024 and 2023.

Automotive Lending - Production

The following table presents a summary of loans to borrowers involved with automotive production.


	September 30, 2024				December 31, 2023
(in millions)	Loans Outstanding		Percent of Total Loans		Loans Outstanding		Percent of Total Loans
Production:
Domestic	$	558			$	591
Foreign	293				257
Total production	$	851	1.7	%	$	848	1.6	%

Loans to borrowers involved with automotive production, primarily Tier 1 and Tier 2 suppliers, totaled $851 million at September 30, 2024 and $848 million December 31, 2023. These borrowers have faced, and could face in the future, financial difficulties due to disruptions in auto production, issues with supply chains and logistics operations and impacts resulting from labor union strikes. As such, management continues to monitor this portfolio.

Nonaccrual loans to borrowers involved with automotive production totaled $2 million and $17 million at September 30, 2024 and December 31, 2023, respectively. Automotive production loan net recoveries totaled $1 million for the three- and nine-month periods ended September 30, 2024, compared to none for both the three months ended June 30, 2024 and the nine months ended September 30, 2023.

Residential Real Estate Lending

At September 30, 2024, residential real estate loans represented 7 percent of total loans. The following table summarizes the Corporation's residential mortgage and home equity loan portfolios by geographic market.


	September 30, 2024								December 31, 2023
(dollar amounts in millions)	Residential Mortgage Loans		% of Total		Home Equity Loans		% of Total		Residential Mortgage Loans		% of Total		Home Equity Loans		% of Total
Geographic market:
Michigan	$	570	30	%	$	427	24	%	$	548	29	%	$	444	25	%
California	867		46		920		51		871		46		911		51
Texas	270		14		360		20		272		14		351		20
Other Markets	194		10		87		5		198		11		86		4
Total	$	1,901	100	%	$	1,794	100	%	$	1,889	100	%	$	1,792	100	%

Residential real estate loans, which consist of traditional residential mortgages and home equity loans and lines of credit, totaled $3.7 billion at September 30, 2024. The residential real estate portfolio is principally located within the Corporation's primary geographic markets. Substantially all residential real estate loans past due 90 days or more are placed on

Table of Contents

nonaccrual status, and substantially all junior lien home equity loans that are current or less than 90 days past due are placed on nonaccrual status if full collection of the senior position is in doubt. At no later than 180 days past due, such loans are charged off to current appraised values less costs to sell.

Residential mortgages totaled $1.9 billion at September 30, 2024, and were primarily larger, variable-rate mortgages originated and retained for certain private banking relationship customers. Of the $1.9 billion of residential mortgage loans outstanding, $36 million were on nonaccrual status at September 30, 2024, an increase of $17 million compared to December 31, 2023. The home equity portfolio totaled $1.8 billion at September 30, 2024, of which 95 percent was outstanding under primarily variable-rate, interest-only home equity lines of credit and 5 percent were in amortizing status. Of the $1.8 billion of home equity loans outstanding, $25 million were on nonaccrual status at September 30, 2024. A majority of the home equity portfolio was secured by junior liens at September 30, 2024.

Energy Lending

The Corporation has a portfolio of Energy loans that are included entirely in commercial loans in the Consolidated Balance Sheets. Customers in the Corporation's Energy business line are engaged in exploration and production (E&P) and midstream. E&P generally includes such activities as searching for potential oil and gas fields, drilling exploratory wells and operating active wells. Commitments to E&P borrowers are generally subject to semi-annual borrowing base re-determinations based on a variety of factors including updated prices (reflecting market and competitive conditions), energy reserve levels and the impact of hedging. The midstream sector is generally involved in the transportation, storage and marketing of crude and/or refined oil and gas products. Approximately 95% of loans in the Energy business line are Shared National Credits (SNC), which are facilities greater than or equal to $100 million shared by three or more federally supervised institutions, reflecting the Corporation's focus on larger middle market companies that have financing needs that generally exceed internal individual borrower credit risk limits. The Corporation seeks to develop full relationships with SNC borrowers.

The following table summarizes information about loans in the Corporation's Energy business line.


	September 30, 2024								December 31, 2023
(dollar amounts in millions)	Outstandings				Nonaccrual		Criticized (a)		Outstandings				Nonaccrual		Criticized (a)
Exploration and production (E&P)	$	1,084	83	%	$	—	$	—	$	1,070	77	%	$	4	$	4
Midstream	228		17		—		—		312		23		—		—


Total Energy business line	$	1,312	100	%	$	—	$	—	$	1,382	100	%	$	4	$	4

(a) Includes nonaccrual loans.

Loans in the Energy business line totaled $1.3 billion, or less than 3 percent of total loans, at September 30, 2024, a decrease of $70 million compared to December 31, 2023. Total exposure, including unused commitments to extend credit and letters of credit, was $3.3 billion at September 30, 2024 (a utilization rate of 39 percent) and $3.3 billion at December 31, 2023 (a utilization rate of 42 percent). There were no nonaccrual or criticized Energy loans at September 30, 2024, compared to $4 million at December 31, 2023. There were no Energy net charge-offs for the three months ended September 30, 2024 compared to net recoveries of $9 million for the three months ended June 30, 2024. Energy net recoveries were $9 million for the nine months ended September 30, 2024 compared to net recoveries of $1 million for the nine months ended September 30, 2023.

Leveraged Loans

Certain loans in the Corporation's commercial portfolio are considered leveraged transactions. These loans are typically used for mergers, acquisitions, business recapitalizations, refinancing and equity buyouts. To help mitigate the risk associated with these loans, the Corporation focuses on middle market companies with highly capable management teams, strong sponsors and solid track records of financial performance. Industries prone to cyclical downturns and acquisitions with a high degree of integration risk are generally avoided. Other considerations include the sufficiency of collateral, the level of balance sheet leverage and the adequacy of financial covenants. During the underwriting process, cash flows are stress-tested to evaluate the borrowers' abilities to handle economic downturns and an increase in interest rates.

The FDIC defines higher-risk commercial and industrial (HR C&I) loans for assessment purposes as loans generally with leverage of four times total debt to earnings before interest, taxes and depreciation (EBITDA) as well as three times senior debt to EBITDA, excluding certain collateralized loans.

The following tables summarize information about HR C&I loans, which represented 5 percent of total loans at September 30, 2024 and December 31, 2023.


(in millions)	September 30, 2024		December 31, 2023
Outstandings	$	2,604	$	2,814
Criticized	262		332

Table of Contents

There were $14 million in net charge-offs of leveraged loans during the three months ended September 30, 2024, compared to $3 million for the three months ended June 30, 2024, and $23 million for the nine months ended September 30, 2024, compared to $1 million for the nine months ended September 30, 2023.

Market and Liquidity Risk

Market risk represents the risk of loss due to adverse movement in prices, including interest rates, foreign exchange rates, commodity prices and equity prices. Liquidity risk represents the risk that the Corporation does not have sufficient access to funds to maintain its normal operations at all times or does not have the ability to raise or borrow funds at a reasonable cost at all times.

The Asset Liability Management Committee (ALCO) of the Corporation establishes and monitors compliance with the policies and risk limits pertaining to market and liquidity risk management activities. ALCO meets regularly to discuss and review market and liquidity risk management strategies and consists of executive and senior management from various areas of the Corporation, including treasury, finance, economics, lending, deposit gathering and risk management. Corporate Treasury helps mitigate market and liquidity risk under the direction of ALCO through the actions it takes to manage the Corporation's market, liquidity and capital positions.

The Corporation performs monthly liquidity stress testing to evaluate its ability to meet funding needs in hypothetical stressed environments. Such environments cover a series of scenarios, including both idiosyncratic and market-wide in nature, which vary in terms of duration and severity. The Corporation's evaluation as of September 30, 2024 projected that sufficient sources of liquidity were available under each series of events.

In addition to assessing liquidity risk on a consolidated basis, Corporate Treasury also monitors the parent company's liquidity and has established liquidity coverage requirements for meeting expected obligations without the support of additional dividends from subsidiaries. ALCO's policy on liquidity risk management requires the parent company to maintain sufficient liquidity to meet expected cash obligations, such as debt service, dividend payments and normal operating expenses, over a period of no less than 12 months. The Corporation had liquid assets of $1.3 billion on an unconsolidated basis at September 30, 2024.

Corporate Treasury and the Enterprise Risk Division support ALCO in measuring, monitoring and managing interest rate risk as well as all other market risks. Key activities encompass: (i) providing information and analyses of the Corporation's balance sheet structure and measurement of interest rate and all other market risks; (ii) monitoring and reporting of the Corporation's positions relative to established policy limits and guidelines; (iii) developing and presenting analyses and strategies to adjust risk positions; (iv) reviewing and presenting policies and authorizations for approval; and (v) monitoring of industry trends and analytical tools to be used in the management of interest rate and all other market and liquidity risks.

Interest Rate Risk

Net interest income is the primary source of revenue for the Corporation. Interest rate risk arises in the normal course of business due to differences in the repricing and cash flow characteristics of assets and liabilities, primarily through the Corporation's core business activities of extending loans and acquiring deposits. The Corporation's balance sheet is predominantly characterized by floating-rate loans funded by core deposits. Including the impact of interest rate swaps converting floating-rate loans to fixed, the Corporation's loan composition at September 30, 2024 was 56 percent fixed-rate, 35 percent overnight to 30-day rate, 6 percent 90-day and greater rates and 3 percent prime. The composition of the loan portfolio creates sensitivity to interest rate movements due to the imbalance between the faster repricing of the floating-rate loan portfolio versus deposit products. In addition, the growth and/or contraction in the Corporation's loans and deposits may lead to changes in sensitivity to interest rate movements in the absence of mitigating actions. Examples of such actions are purchasing fixed-rate investment securities, which provide liquidity to the balance sheet and act to mitigate the inherent interest rate sensitivity, as well as hedging with interest rate swaps and options. Other mitigating factors include interest rate floors on a portion of the loan portfolio.

The Corporation actively manages its exposure to interest rate risk with the principal objective of optimizing net interest income and the economic value of equity while operating within acceptable limits established for interest rate risk and maintaining adequate levels of funding and liquidity.

Since no single measurement system satisfies all management objectives, a combination of techniques is used to manage interest rate risk. These techniques examine the impact of interest rate risk on net interest income and the economic value of equity under a variety of alternative scenarios, including changes in the level, slope and shape of the yield curve utilizing multiple simulation analyses. Simulation analyses produce only estimates of net interest income as the assumptions used are inherently uncertain. Actual results may differ from simulated results due to many factors, including, but not limited to, the timing, magnitude and frequency of changes in interest rates, market conditions, regulatory impacts and management strategies.

Table of Contents

Sensitivity of Net Interest Income to Changes in Interest Rates

The analysis of the impact of changes in interest rates on net interest income under various interest rate scenarios is management's principal risk management technique. Management models a base-case net interest income under an unchanged interest rate environment using a static balance sheet and generates sensitivity scenarios by changing certain model assumptions. Each scenario includes assumptions such as loan growth, investment security prepayment levels, depositor behavior and overall balance sheet mix and growth which are in line with historical patterns. Additionally, the analysis assumes that all loan hedges qualify for hedge accounting. Changes in actual economic activity may result in a materially different interest rate environment as well as a balance sheet structure that is different from the changes management included in its simulation analysis. Model assumptions in the sensitivity scenarios at September 30, 2024 included for the rising rate scenarios, a modest increase in loan balances and a moderate decrease in deposit balances, and for the declining rate scenarios, a modest decrease in loan balances and a moderate increase in deposit balances. In addition, both scenarios assumed loan spreads held at current levels, an incremental interest-bearing deposit beta of approximately 47%, deposit mix shifts based on historical observations, partial reinvestment of securities portfolio cash flows and no additions to interest rate swaps.

The average balance of the securities portfolio included in the analysis was $15.9 billion for the three months ended September 30, 2024 with an average yield of 2.17% and effective duration of 5.6 years.

The table below details components of the variable-rate loan swap portfolio at September 30, 2024.


	Variable-Rate Loan Swaps
(dollar amounts in millions)	Notional Amount		Weighted Average Yield		Years to Maturity (a)
Swaps under contract at September 30, 2024 (b)	$	29,500	2.48	%	2.7
Swaps under contract at September 30, 2024, excluding bridge swaps with CME (c)	23,900		2.53		2.6
Weighted average notional active per period:

Full year 2024	23,575		2.50		2.6
Full year 2025	22,973		2.57		3.4

(a) Years to maturity calculated from a starting date of September 30, 2024.

(b) Includes forward starting swaps of $6.1 billion starting in fourth quarter 2024. Excluding forward starting swaps, the weighted average yield was 2.51%.

(c) Excludes $5.6 billion of bridge swaps used for BSBY transition purposes by the CME. See "BSBY Cessation" section for more information.

The analysis also includes interest rate swaps that convert $6.8 billion of fixed-rate medium- and long-term debt and FHLB advances to variable rates through fair value hedges. Additionally, included in this analysis are $15.0 billion of loans that were subject to an average interest rate floor of 51 basis points at September 30, 2024. This base-case net interest income is then compared against interest rate scenarios in which short-term rates rise or decline 100 or 200 basis points (with a floor of zero percent) in a linear, non-parallel fashion from the base case over 12 months, resulting in an average change of 50 or 100 basis points over the period.

The table below, as of September 30, 2024 and December 31, 2023, displays the estimated impact on net interest income during the next 12 months by relating the base case scenario results to those from the rising and declining rate scenarios described above.


	Estimated Annual Change
	September 30, 2024					December 31, 2023
(dollar amounts in millions)	Amount		%			Amount		%
Change in Interest Rates:					Change in Interest Rates:
Rising 100 basis points	$	(21)	(1	%)	Rising 100 basis points	$	(36)	(2	%)
(50 basis points on average)					(50 basis points on average)
Declining 100 basis points	9		—		Declining 100 basis points	23		1
(50 basis points on average)					(50 basis points on average)
Rising 200 basis points	(57)		(2)		Rising 200 basis points	(87)		(4)
(100 basis points on average)					(100 basis points on average)
Declining 200 basis points	6		—		Declining 200 basis points	33		1
(100 basis points on average)					(100 basis points on average)

Sensitivity to both rising and declining interest rates decreased from December 31, 2023 to September 30, 2024 due to changes in balance sheet mix dynamics.

Table of Contents

At September 30, 2024, additional sensitivity scenarios applied the rising and declining 100 basis point scenario assumptions with a 60% incremental deposit beta relative to the base case scenario to assess the impact of the Corporation's deposit beta assumptions. In these rising and declining scenarios, net interest income decreased by $50 million and increased by $31 million, respectively, due to a more rapid repricing pace compared to the standard model assumptions.

Sensitivity of Economic Value of Equity to Changes in Interest Rates

In addition to the simulation analysis on net interest income, an economic value of equity analysis provides an alternative view of the interest rate risk position. The economic value of equity is the difference between the estimate of the economic value of the Corporation's financial assets, liabilities and off-balance sheet instruments, derived through discounting cash flows based on actual rates at the end of the period, and the estimated economic value after applying the estimated impact of rate movements. The Corporation primarily monitors the percentage change on the base-case economic value of equity. The economic value of equity analysis is based on an immediate parallel 100 or 200 basis point shock with a floor of zero percent.

The table below, as of September 30, 2024 and December 31, 2023, displays the estimated impact on the economic value of equity from the interest rate scenario described above.


	September 30, 2024					December 31, 2023
(dollar amounts in millions)	Amount		%			Amount		%
Change in Interest Rates:					Change in Interest Rates:
Rising 100 basis points	$	(586)	(5	%)	Rising 100 basis points	$	(567)	(4	%)
Declining 100 basis points	700		5		Declining 100 basis points	794		6
Rising 200 basis points	(1,239)		(10)		Rising 200 basis points	(1,254)		(10)
Declining 200 basis points	1,260		10		Declining 200 basis points	1,363		11

The sensitivity of economic value of equity to rising and declining rates was largely unchanged from December 31, 2023 to September 30, 2024.

BSBY Cessation

On November 15, 2023, the Bloomberg Index Services Limited (Bloomberg) announced that it will discontinue publishing BSBY on November 15, 2024; accordingly, the Corporation was required to “de-designate” $7.0 billion of interest rate swaps used in cash flow hedges of certain BSBY-indexed loans and reclassify amounts recognized in accumulated other comprehensive income into earnings. For each de-designated swap, settlement of interest payments and changes in fair value were recorded as risk management hedging losses within other noninterest income instead of net interest income until re-designation. All impacted swaps were re-designated as of April 1, 2024.

BSBY cessation negatively impacted interest income on commercial loans by $9 million for the three months ended September 30, 2024, compared to $3 million for the three months ended June 30, 2024. Refer to Note 6 to the consolidated financial statements for further discussion of re-designated interest rate hedges.

At September 30, 2024, the Corporation had $22.8 billion of exposure to BSBY-based products, including $12.4 billion in loans and $10.4 billion in interest rate swaps. The Corporation ceased originating BSBY-based products and is working to convert BSBY-based loans to other indices as repricing opportunities occur. The Corporation expects any BSBY-based contracts that do not organically transition to SOFR by November 15, 2024, will transition to SOFR through existing fallback language, which for loans is the first repricing date after BSBY cessation occurs in November 2024. For interest rate swaps, the Corporation plans to enact the International Swaps and Derivatives Association (ISDA) Definition and Benchmark Supplement language, as applicable.

In the third quarter of 2023, as part of the transition from BSBY to SOFR, the CME converted existing BSBY swaps into two swaps: a short-dated BSBY swap (bridge swap) and a forward starting SOFR swap (surviving swap). The two swaps are designed to cover the same period of time as the original BSBY swap. As a result of this approach, the conversion resulted in a temporary $9.3 billion increase in notional balances when compared to the former BSBY-based swaps cleared through the CME, which consisted of $5.6 billion in cash flow swaps and $3.7 billion in customer-initiated swaps. This temporary increase in notional amounts due to the bridge swaps is expected to resolve in the fourth quarter of 2024.

Table of Contents

Sources of Liquidity

The Corporation maintains a liquidity position that it believes will adequately satisfy its financial obligations while taking into account potential commitment draws and deposit run-off that may occur in the normal course of business. The majority of the Corporation's balance sheet is funded by customer deposits. Cash flows from loan repayments, increases in deposit accounts (including brokered deposits), activity in the securities portfolio and wholesale funding channels serve as the Corporation's primary liquidity sources.

The Corporation satisfies incremental liquidity needs with either liquid assets or external funding sources. Available liquidity includes cash, FHLB advances and FRB borrowing through the discount window, as well as the market value of unencumbered investment securities, which, if needed, could be utilized as collateral for FHLB advances and FRB borrowings. The Corporation has pledged a portion of its investment securities portfolio to access wholesale funding as needed.

The Bank is a member of the FHLB of Dallas, Texas, which provides short- and long-term funding to its members through advances collateralized by real estate-related loans, certain government agency-backed securities and other eligible assets. Actual borrowing capacity is contingent on the amount of collateral pledged to the FHLB and the fair value of pledged assets, as well as applicable FHLB haircuts.

At September 30, 2024, the Bank had pledged real estate-related loans totaling $22.5 billion and investment securities totaling $6.4 billion to the FHLB, which provided for up to $17.3 billion of collateralized borrowing with the FHLB.

The FRB provides liquidity through its discount window, where banks may borrow funds based on the discounted fair value of pledged assets. At September 30, 2024, the Bank pledged $20.3 billion of loans to the FRB, which provided for up to $16.8 billion of collateralized borrowing through the discount window.

The table below details the Corporation's sources of available liquidity at September 30, 2024.


(dollar amounts in millions)	Total Capacity		Borrowings Outstanding		Available Liquidity
Cash on deposit with FRB (a)					$	5,374
Unencumbered investment securities (b)					8,575
Secured borrowing facilities:
FHLB	$	17,311	$	4,000	13,311
FRB	16,804		—		16,804
Total available liquidity					$	44,064

(a) Included in interest-bearing deposits with banks on the Consolidated Balance Sheet.

(b) Market value of available-for-sale investment securities that the Corporation can pledge or sell without third-party consent.

The Corporation may also use brokered deposits and external debt as additional sources of funding, and maintains a shelf registration statement with the Securities and Exchange Commission through which it may issue securities. The ability of the Corporation and the Bank to raise unsecured funding at competitive rates is impacted by rating agencies' views of the credit quality, liquidity, capital, earnings and other relevant factors related to the Corporation and the Bank. As of September 30, 2024, the three major rating agencies had assigned the following ratings to long-term senior unsecured obligations of the Corporation and the Bank, as well as long-term deposits at the Bank. A security rating is not a recommendation to buy, sell, or hold securities and may be subject to revision or withdrawal at any time by the assigning rating agency. Each rating should be evaluated independently of any other rating.

Debt Ratings

Deposit Ratings

Comerica Incorporated

Comerica Bank

September 30, 2024

Rating

Outlook

Rating

Moody’s Investors Service (a)

Baa1

Negative

Fitch Ratings

A-

Negative

Standard and Poor’s

BBB

BBB+

Stable

not rated

(a) In September 2024, Moody's Investors Service placed the Corporation and Bank's ratings on review for downgrade.

Table of Contents

Deposit Concentrations and Uninsured Deposits

The Corporation's uninsured deposits are well-diversified between geographies, industries and customers. At September 30, 2024, the Retail Bank and general Middle Market segments, both highly diversified and granular, accounted for 38% and 27% of the total deposit base, respectively. Corporate Banking and Technology and Life Sciences comprised 6% and 5% each of total deposits, respectively, which were the largest deposit concentrations of the more specialized business lines.

Uninsured deposits are defined as the portion of deposit accounts in U.S. offices that exceed the FDIC insurance limit and amounts in any other uninsured investment or deposit account that are classified as deposits and are not subject to any federal or state deposit insurance regimes.


	September 30, 2024				December 31, 2023
(Dollar amount in millions)	Amount		Percentage of total deposits		Amount		Percentage of total deposits
Total uninsured deposits, as calculated per regulatory guidelines	$	31,926	51	%	$	31,485	47	%
Less: affiliate deposits	(3,839)				(4,064)
Total uninsured deposits, excluding affiliate deposits	$	28,087	45	%	$	27,421	41	%

Time deposits otherwise uninsured, which consist of foreign office time deposits, totaled $25 million at September 30, 2024 and all mature in three months or less. Collateralized deposits, consisting of trust deposits as well as deposits of public entities and state and local government agencies, totaled $361 million at September 30, 2024, compared to $687 million at December 31, 2023.

Direct Express Debit MasterCard Program

In July 2024, the Bank received preliminary notification that it was not selected to continue serving as financial agent supporting the Direct Express Debit MasterCard Program for the U.S. Department of the Treasury, Bureau of the Fiscal Service (Treasury), following the contract expiration on January 2, 2025. As financial agent, the Bank has been the exclusive issuer of the Direct Express prepaid debit card for federal benefit recipients. The contract provides for a potential extension of the contract term for up to three years past January 2, 2025, to facilitate an orderly transition. Under the contract, Treasury will use reasonable efforts to notify the Bank by December 3, 2024, of its exercise of the transition period extension option. While the length of the transition is currently unknown, the Corporation believes it may take some time given the scale and complexity of the program as well as its own transition experience.

For the three months ended September 30, 2024, average deposits related to the Direct Express program were $3.4 billion, all of which were noninterest-bearing. Card fee income related to the Direct Express program was $137 million and $30 million for the year ended December 31, 2023 and the three months ended September 30, 2024, respectively. Outside processing expenses related to the Direct Express program were $138 million and $29 million, respectively, for the same periods. The Corporation cannot currently predict the impact that the loss of this contract and the related deposits could have on its financial statements as it will be subject to many factors, including the timing, costs and extent of securing any necessary alternative sources of funding. However, such impact could be material.

Table of Contents

CRITICAL ACCOUNTING ESTIMATES

The Corporation’s consolidated financial statements are prepared based on the application of accounting policies, the most significant of which are described in Note 1 to the consolidated financial statements included in the Corporation's 2023 Annual Report. These policies require numerous estimates and strategic or economic assumptions, which may prove inaccurate or subject to variations. Changes in underlying factors, assumptions or estimates could have a material impact on the Corporation’s future financial condition and results of operations. At December 31, 2023, the most critical of these estimates related to the allowance for credit losses, fair value measurement, goodwill, pension plan accounting and income taxes. These estimates were reviewed with the Audit Committee of the Corporation’s Board of Directors and are discussed more fully on pages F-35 through F-38 in the Corporation's 2023 Annual Report. As of the date of this report, there have been no significant changes to the Corporation's critical accounting estimates as disclosed in the Corporation's 2023 Annual Report.

Table of Contents

SUPPLEMENTAL FINANCIAL DATA

The Corporation believes non-GAAP measures are meaningful because they reflect adjustments commonly made by management, investors, regulators and analysts to evaluate the adequacy of common equity and our performance trends. Tangible common equity is used by the Corporation to measure the quality of capital and the return relative to balance sheet risk. Common equity tier 1 capital ratio removes preferred stock from the Tier 1 capital ratio as defined by and calculated in conformity with bank regulations. The tangible common equity ratio removes the effect of intangible assets from capital and total assets. Tangible common equity per share of common stock removes the effect of intangible assets from common shareholders' equity per share of common stock.

The following table provides a reconciliation of non-GAAP financial measures and regulatory ratios used in this financial review with financial measures defined by GAAP.


(dollar amounts in millions, except per share data)	September 30, 2024			December 31, 2023






Common Equity Tier 1 Capital (a):
Tier 1 capital	$	9,078		$	8,808
Less:
Fixed-rate reset non-cumulative perpetual preferred stock	394			394
Common equity tier 1 capital	$	8,684		$	8,414
Risk-weighted assets	$	72,576		$	75,901
Tier 1 capital ratio	12.51		%	11.60		%
Common equity tier 1 capital ratio	11.97			11.09
Tangible Common Equity Ratio:
Total shareholders' equity	$	7,366		$	6,406
Less:
Fixed-rate reset non-cumulative perpetual preferred stock	394			394
Common shareholders' equity	$	6,972		$	6,012
Less:
Goodwill	635			635
Other intangible assets	6			8
Tangible common equity	$	6,331		$	5,369
Total assets	$	79,663		$	85,834
Less:
Goodwill	635			635
Other intangible assets	6			8
Tangible assets	$	79,022		$	85,191
Common equity ratio	8.75		%	7.00		%
Tangible common equity ratio	8.01			6.30
Tangible Common Equity per Share of Common Stock:
Common shareholders' equity	$	6,972		$	6,012
Tangible common equity	6,331			5,369
Shares of common stock outstanding (in millions)	133			132
Common shareholders' equity per share of common stock	$	52.52		$	45.58
Tangible common equity per share of common stock	47.69			40.70

(a) September 30, 2024 ratios are estimated.

Total uninsured deposits as calculated per regulatory guidance and reported on schedule RC-O of the Bank’s Call Report include affiliate deposits, which by definition have a different risk profile than other uninsured deposits. The amounts presented below remove affiliate deposits from the total uninsured deposits number. The Corporation believes that the presentation of uninsured deposits adjusted for the impact of affiliate deposits provides enhanced clarity of uninsured deposits at risk.


(dollar amounts in millions)	September 30, 2024		December 31, 2023
Uninsured Deposits:
Total uninsured deposits, as calculated per regulatory guidelines	$	31,926	$	31,485
Less: affiliate deposits	(3,839)		(4,064)
Total uninsured deposits, excluding affiliate deposits	$	28,087	$	27,421

Table of Contents

ITEM 3. Quantitative and Qualitative Disclosures about Market Risk

Quantitative and qualitative disclosures for the current period can be found in the "Market and Liquidity Risk" section of "Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations."

ITEM 4. Controls and Procedures

(a) Evaluation of Disclosure Controls and Procedures . The Corporation maintains a set of disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the Exchange Act)) that are designed to ensure that information required to be disclosed by the Corporation in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms, and that such information is accumulated and communicated to the Corporation's management, including the Corporation's Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. Management has evaluated, with the participation of the Corporation's Chief Executive Officer and Chief Financial Officer, the effectiveness of the Corporation's disclosure controls and procedures as of the end of the period covered by this quarterly report (the Evaluation Date). Based on the evaluation, the Corporation's Chief Executive Officer and Chief Financial Officer have concluded that, as of the Evaluation Date, the Corporation's disclosure controls and procedures are effective.

(b) Changes in Internal Control Over Financial Reporting . During the period to which this report relates, there have not been any changes in the Corporation's internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) that have materially affected, or that are reasonably likely to materially affect, such controls.

PART II. OTHER INFORMATION

ITEM 1. Legal Proceedings

For information regarding the Corporation's legal proceedings, see "Part I. Item 1. Note 13 – Contingent Liabilities," which is incorporated herein by reference.

ITEM 1A. Risk Factors

There has been no material change in the Corporation's risk factors as previously disclosed in our Form 10-K for the year ended December 31, 2023 in response to Part I, Item 1A. of such Form 10-K. Such risk factors are incorporated herein by reference.

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

For information regarding the Corporation's purchase of equity securities, see "Part I. Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations – Capital," which is incorporated herein by reference.

ITEM 5. Other Information

No director or officer (as defined in Rule 16a-1(f) of the Exchange Act) of the Corporation adopted, modified, or terminated any Rule 10b5-1 trading arrangement or any non-Rule 10b5-1 trading arrangement (as such terms are defined in Item 408 of Regulation S-K) during the quarter ended September 30, 2024.

Table of Contents

ITEM 6. Exhibits


Exhibit No.						Description

3.1						Restated Certificate of Incorporation of Comerica Incorporated (filed as Exhibit 3.2 to Corporation's Current Report on Form 8-K dated August 4, 2010, and incorporated herein by reference).

3.2						Certificate of Amendment to Restated Certificate of Incorporation of Comerica Incorporated (filed as Exhibit 3.2 to Corporation's Quarterly Report on Form 10-Q for the quarter ended March 31, 2011, and incorporated herein by reference).

3.3						Amended and Restated Bylaws of Comerica Incorporated (filed as Exhibit 3.3 to Corporation's Current Report on Form 8-K dated November 3, 2020, and incorporated herein by reference).

3.4						Certificate of Designations of 5.625% Fixed-Rate Reset Non-Cumulative Perpetual Preferred Stock, Series A, dated May 26, 2020, of Comerica Incorporated (including the form of 5.625% Fixed-Rate Reset Non-Cumulative Perpetual Preferred Stock, Series A Certificate of Comerica Incorporated attached as Exhibit A thereto) (filed as Exhibit 3.1 to Corporation's Current Report on Form 8-K dated May 26, 2020, and incorporated herein by reference).
4						[In accordance with Regulation S-K Item No. 601(b)(4)(iii), the Corporation is not filing copies of instruments defining the rights of holders of long-term debt because none of those instruments authorizes debt in excess of 10% of the total assets of the registrant and its subsidiaries on a consolidated basis. The Corporation hereby agrees to furnish a copy of any such instrument to the SEC upon request.]

31.1						Chairman, President and CEO Rule 13a-14(a)/15d-14(a) Certification of Periodic Report (pursuant to Section 302 of the Sarbanes-Oxley Act of 2002).

31.2						Senior Executive Vice President and CFO Rule 13a-14(a)/15d-14(a) Certification of Periodic Report (pursuant to Section 302 of the Sarbanes-Oxley Act of 2002).

32*						Section 1350 Certification of Periodic Report (pursuant to Section 906 of the Sarbanes-Oxley Act of 2002).

99.1						Comerica Incorporated Compensation Recovery Policy, adopted on November 7, 2023.

101						Financial statements from Quarterly Report on Form 10-Q of the Corporation for the quarter ended September 30, 2024, formatted in Inline XBRL: (i) the Consolidated Balance Sheets (unaudited), (ii) the Consolidated Statements of Comprehensive Income (unaudited), (iii) the Consolidated Statements of Changes in Shareholders' Equity (unaudited), (iv) the Consolidated Statements of Cash Flows (unaudited) and (v) the Notes to Consolidated Financial Statements (unaudited).

104						The cover page from the Corporation's Quarterly Report on Form 10-Q for the quarter ended September 30, 2024, formatted in Inline XBRL (included in Exhibit 101).

*						The certification attached as Exhibit 32 is not deemed “filed” with the SEC and is not to be incorporated by reference into any filing of the Corporation under the Securities Act of 1933, as amended, or the Exchange Act, whether made before or after the date of this Quarterly Report on Form 10-Q, irrespective of any general incorporation language contained in such filing.

†						Management contract or compensatory plan or arrangement.

Table of Contents

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


			COMERICA INCORPORATED
			(Registrant)

			/s/ Mauricio A. Ortiz
			Mauricio A. Ortiz
			Executive Vice President,
			Chief Accounting Officer,
			Controller and
			Duly Authorized Officer

Date: October 28, 2024

TABLE OF CONTENTS

Part I. Financial Information Item 1. Financial Statements Note 1 - Basis Of Presentation and Accounting Policies Note 2 Fair Value Measurements Note 3 - Investment Securities Note 4 Credit Quality and Allowance For Credit Losses Note 5 - Goodwill and Intangibles Note 6 Derivatives and Credit-related Financial Instruments Note 7 - Variable Interest Entities (vies)Note 8 - Medium- and Long-term Debt Note 9 - Accumulated Other Comprehensive Loss Note 10 - Net Income Per Common Share Note 11 - Employee Benefit Plans Note 12 - Income Taxes and Tax-related Items Note 13 - Contingent Liabilities Note 14 - Strategic Lines Of Business Note 15 - Revenue From Contracts with Customers Item 2. Management's Discussion and Analysis Of Financial Condition and Results Of Operations Item 3. Quantitative and Qualitative Disclosures About Market Risk Item 4. Controls and Procedures Part II. Other Information Item 1. Legal Proceedings Item 1A. Risk Factors Item 2. Unregistered Sales Of Equity Securities and Use Of Proceeds Item 5. Other Information Item 6. Exhibits

Exhibits

3.1 Restated Certificate of Incorporation of Comerica Incorporated (filed as Exhibit 3.2 to Corporation's Current Report on Form 8-K dated August 4, 2010, and incorporated herein by reference). 3.2 Certificate of Amendment to Restated Certificate of Incorporation of Comerica Incorporated (filed as Exhibit 3.2 to Corporation's Quarterly Report on Form 10-Q for the quarter ended March 31, 2011, and incorporated herein by reference). 3.3 Amended and Restated Bylaws of Comerica Incorporated (filed as Exhibit 3.3 to Corporation's Current Report on Form 8-K dated November 3, 2020, and incorporated herein by reference). 3.4 Certificate of Designations of 5.625% Fixed-Rate Reset Non-Cumulative Perpetual Preferred Stock, Series A, dated May 26, 2020, of Comerica Incorporated (including the form of 5.625% Fixed-Rate Reset Non-Cumulative Perpetual Preferred Stock, Series A Certificate of Comerica Incorporated attached as Exhibit A thereto) (filed as Exhibit 3.1 to Corporation's Current Report on Form 8-K dated May 26, 2020, and incorporated herein by reference). 31.1 Chairman, President and CEO Rule13a-14(a)/15d-14(a) Certification of Periodic Report (pursuant to Section302 of the Sarbanes-Oxley Act of 2002). 31.2 Senior Executive Vice President and CFO Rule13a-14(a)/15d-14(a) Certification of Periodic Report (pursuant to Section302 of the Sarbanes-Oxley Act of 2002). 32* Section1350 Certification of Periodic Report (pursuant to Section906 of the Sarbanes-Oxley Act of 2002). 99.1 Comerica Incorporated Compensation Recovery Policy, adopted on November 7, 2023.

Supplier name	Ticker
Visa Inc.	V
Mastercard Incorporated	MA
Canaan Inc.	CAN
MarketAxess Holdings Inc.	MKTX
Intercontinental Exchange, Inc.	ICE
CME Group Inc.	CME
Equifax Inc.	EFX
Nasdaq, Inc.	NDAQ

CMA 10-Q Quarter ended Sept. 30, 2024

Exhibits