Comerica (CMA) Morgan Stanley US Financials, Payments & CRE Conference 2025 summary

Strategic growth initiatives

• Focused on expanding payments and deposits business through investments in talent, technology, and new products, including API-based solutions and partnerships with financial institutions.

• Targeting 5%-7% CAGR deposit growth and ~7% CAGR in payments noninterest income, with customized sweep solutions and embedded finance for banks and non-banks.

• Pursuing geographic expansion, especially in the Southeast, and increasing hiring in Texas and California to match Michigan's success, with a presence in 14 of the 15 largest U.S. markets.

• Emphasizing a differentiated approach: combining comprehensive product offerings with personalized service and community engagement to attract and retain complex payment customers.

• Strategic revenue initiatives focus on middle market, payments, national/specialty businesses, capital markets, and wealth management for sustainable growth.

Financial performance and outlook

• Loan growth is broad-based across most business lines and geographies, with commercial real estate balances stable and environmental services showing strong momentum.

• Net interest income is expected to increase quarter-to-quarter, supported by maturing swaps, securities, and ongoing loan and deposit growth, with multi-year tailwinds from securities maturities.

• Efficiency improvements are expected from revenue growth, ongoing expense management, and self-funding of strategic investments.

• Completed $100 million in share repurchases and redeemed preferred stock, improving capital efficiency; CET1 ratio remains strong at 12.05%, supporting continued buybacks.

• Conservative capital management and diversified funding sources maintain CET1 well above target, with robust liquidity and a loan-to-deposit ratio below historical averages at 81%.

Payments and fee income expansion

• Payments business is a major growth driver, with new partnerships, API-based deposit sweep, and third-party clearing solutions, and Maximize solution growing from $74 million to over $1 billion in six quarters.

• Customer-related fee income is expected to grow, driven by payments, capital markets, and wealth management, with new M&A teams enhancing capabilities.

• Wealth management and capital markets are positioned for further growth, leveraging cross-business partnerships and expanded product offerings, with wealth management representing ~27% of noninterest income and ~$195B in assets under administration.

• Payments strategy includes expanding 24/7/365 capabilities, integrating RTP and FedNow, and digitizing customer experiences for both banks and non-banks.

• Targeted deposit initiatives and treasury management services support growth in small business and commercial segments.