Company: CMA
Filing Date: 2025-02-24
Form Type: 10-K
Source: 0000028412-25-000108
Chunk: 312

Company: COMERICA INC
Filing Date: 2025-02-24
Form: 10-K
Item: Item 1
Chunk 312
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3.5 billion (a utilization rate of 41%) and $3.3 billion (a utilization of 42 percent) at December 31, 2024 and December 31, 2023, respectively. There were no nonaccrual or criticized at Energy loans at December 31, 2024, compared to $4 million at December 31, 2023. Energy net recoveries were $10 million for the year ended December 31, 2024, compared to net recoveries of $1 million for the year ended December 31, 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 table summarizes information about HR C&I loans, which represented 6 percent and 5 percent of total loans at December 31, 2024 and December 31, 2023, respectively.

(in millions)December 3120242023Outstandings$2,836 $2,814 Criticized300 332 Net loan charge-offs recorded during the years ended December 31,23 5 

F-27

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