Comerica Incorporated CMA has reported third-quarter 2025 earnings per share (EPS) of $1.35, beating the Zacks Consensus Estimate of $1.28. In the prior-year quarter, the company reported an EPS of $1.37.
Results have benefited from a rise in net interest income (NII) and deposit balance. Yet, lower loan balances, a decline in non-interest income, a rise in expenses, and weak asset quality were concerning.
Net income attributable to common shareholders was $175 million, which declined 1.1% from the year-ago quarter.
Comerica's Revenues & Expenses Rise
Total quarterly revenues were $838 million, up 3.3% year over year. The top line missed the consensus estimate by 0.7%.
Quarterly NII rose 7.5% on a year-over-year basis to $574 million. The net interest margin increased 29 basis points year over year to 3.09%.
Total non-interest income was $264 million, down 4.7% on a year-over-year basis.
Non-interest expenses totaled $589 million, up 4.8% year over year.
The efficiency ratio was 70.23% compared with the prior-year quarter’s 68.8%. A rise in this ratio indicates declining profitability.
CMA’s Loans Balance Decline & Deposit Rise
As of Sept. 30, 2025, total loans fell marginally on a sequential basis to $50.9 billion. Total deposits rose 4.3% from the previous quarter to $62.6 billion.
Comerica's Credit Quality Deteriorates
The company recorded a provision for credit loss of $22 million in the third quarter compared with $14 million in the year-ago quarter.
The allowance for credit losses was $725 million, which rose marginally year over year.
Total non-performing assets rose 4% year over year to $260 million.
The allowance for credit losses to total loans ratio was 1.43% as of Sept. 30, 2025, unchanged from the year-ago reported level. Also, the company recorded net charge-offs of $32 million, significantly up from $11 million in the year-ago quarter.
CMA's Capital Position Mixed Bag
The total capital ratio was 14.12%, down from 14.29% in the year-ago quarter. The Common Equity Tier 1 capital ratio was 11.90%, down from 11.96% in the prior-year quarter.
As of Sept. 30, 2025, CMA's tangible common equity ratio was 8.34%, up from 8.01% in the prior-year quarter.
Comerica’s Capital Distribution Activities
The company repurchased $150 million of common stock under the share repurchase program.
CMA’s Recent Development
This month, Comerica entered a definitive merger agreement with Fifth Third Bancorp FITB, under which the latter will acquire CMA in an all-stock transaction valued at $10.9 billion.
The transaction is expected to close by the end of the first quarter of 2026 and will combine two banking franchises to form the ninth-largest U.S. bank, with nearly $288 billion in assets, $224 billion in deposits, and $174 billion in loans.
The combined entity will operate in 17 of the 20 fastest-growing markets in the country, including key regions in the Southeast, Texas, and California, while reinforcing its leadership in the Midwest. Also, the combined loan book will have a more balanced composition, reducing commercial loan concentration from 44% to 36%. That diversification can prove critical in volatile credit cycles, helping stabilize earnings even if regional economies weaken.
Our View on CMA
Comerica’s third-quarter 2025 results reflect a mixed performance, with higher net interest income growth driving an earnings beat, while rising expenses and deteriorating credit quality tempered overall momentum.
Looking ahead, the planned $10.9-billion merger with Fifth Third Bancorp will position Comerica for expanded scale, improved diversification, and enhanced competitiveness in key growth markets. While near-term challenges persist, the strategic combination and continued focus on operational efficiency may bolster long-term shareholder value.
Comerica Incorporated Price, Consensus and EPS Surprise
Comerica Incorporated price-consensus-eps-surprise-chart | Comerica Incorporated Quote
Currently, Comerica carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Another Bank
First Horizon Corporation’s FHN third-quarter 2025 adjusted earnings per share (excluding notable items) of 51 cents surpassed the Zacks Consensus Estimate of 45 cents. This compares favorably with 42 cents in the year-ago quarter.
FHN’s results benefited from a rise in net interest income and non-interest income, along with provision benefits. However, a decline in loan and deposit balances acted as a headwind.
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Comerica Incorporated (CMA) : Free Stock Analysis Report
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This article originally published on Zacks Investment Research (zacks.com).
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
