Company: CMA
Filing Date: 2025-02-24
Form Type: 10-K
Source: 0000028412-25-000108
Chunk: 350

Company: COMERICA INC
Filing Date: 2025-02-24
Form: 10-K
Item: Item 1A
Chunk 350
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erica's ability to maintain relationships with customers and employees or achieve the anticipated benefits of the acquisition. These matters could have an adverse effect on Comerica for an undetermined period. Comerica would be subject to similar risks and difficulties in connection with any future decisions to downsize, sell or close units or otherwise change the business mix of Comerica.

GENERAL RISK

•General political, economic or industry conditions, either domestically or internationally, may be less favorable than expected.

Economic, financial market, political, and industry-specific developments may affect the financial services industry, both directly and indirectly. The economic environment and market conditions in which Comerica operates, at the local, domestic, and international levels, continue to be uncertain. The U.S. economy faces uncertainties from interest rates that remain elevated despite recent decreases, persistent inflation, large fiscal deficits, subdued housing market activity and a sluggish manufacturing sector. It also faces downside risks from geopolitical conflicts around the globe, including those involving Venezuela; the Israel-Hamas War and its spread to Yemen, Lebanon, and/or other parts of the Middle East; the Ukraine-Russia War and its effects in Europe; tensions between Taiwan and mainland China; threats from North Korea; and the possibility of other geopolitical shocks.

Domestically, the public debt, the possibility of a federal government shutdown and/or debt ceiling crisis, as well as broader issues surrounding the federal budgeting process and governance, may contribute to the possibility of a downgrade of the U.S. sovereign credit rating, potentially causing knock-on effects for the broader economy and financial system that could include a recession. 

The Federal Reserve rapidly tightened monetary policies during the recovery from the 2020 recession, including both increases in interest rates and reductions in the size of the central bank’s balance sheet, before beginning to reduce interest rates in 2024. However, the impacts interest rates have on the U.S. economy often are not immediate and take time to materialize after such changes in interest rates occur, and their substantial increase relative to the pre-pandemic period could still cause stress on capital-intensive sectors of the economy, including manufacturing, real estate, and highly leveraged corporate balance sheets.

Fiscal and industrial policies to support the growth of targeted industries could have unanticipated effects or change unexpectedly, causing volatility in the economic performance of these industries or other parts of the economy. These effects could impact the energy industry, manufacturing, construction, automotive manufacturing, information, and retailing, or potentially other industries. Prices of energy products and services, as