Company: CMA
Filing Date: 2025-07-30
Form Type: 10-Q
Source: 0000028412-25-000197
Chunk: 220

Company: COMERICA INC
Filing Date: 2025-07-30
Form: 10-Q
Item: Part I, Item 8
Chunk 220
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 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 the Corporation 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 300 basis point decrease to CET1 as of June 30, 2025. 

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RISK MANAGEMENT

The following updated information should be read in conjunction with the "Risk Management" section on pages F-19 through F-35 in the Corporation's 2024 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 following table presents metrics of the allowance for credit losses and nonperforming loans.

June 30, 2025December 31, 2024Allowance for credit losses as a percentage of total loans1.44%1.44%Allowance for credit losses as a multiple of total nonperforming loans3.0x2.4x

Stable credit metrics offset by elevated levels of uncertainty incorporated into the estimate resulted in an unchanged allowance for credit losses to total loans ratio as of June 30, 2025 compared to December 31, 2024. Loan growth, in conjunction with the factors above, contributed to a $10 million increase in the allowance for credit losses to $735 million at June 30, 2025 from $725 million at December 31, 2024.

CECL Forecast and Economic Variables at June 30, 2025

The economic forecasts informing the CECL model reflected a moderately weaker outlook after including the impact of new tariff policies and continued to reflect an elevated degree of uncertainty amid ongoing rapid changes in domestic and foreign economic policies. The impact of potential additional tariff increases and changes to federal government operations were still unclear, creating challenges to economic forecasting. The FRB was assumed to gradually lower interest rates over the projection period as they remained vigilant toward inflation. Consumer spending growth continued to moderate amid slower, albeit continued, growth of the real economy. Inflation was anticipated to gradually moderate as a modest margin of slack capacity is expected to open in the labor market. Energy prices were projected to hold at lower levels than seen at the close of the first quarter, with supply outp