-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, QNoeS4Ta718QFt4yge580idErl7NAVc5cTrrqkmaGMgd5I19AgkJRuYRt9b7O1mt ow2IDyj/zYqqSTsEm2xK6A== 0000912057-97-001539.txt : 19970124 0000912057-97-001539.hdr.sgml : 19970124 ACCESSION NUMBER: 0000912057-97-001539 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 4 CONFORMED PERIOD OF REPORT: 19970122 ITEM INFORMATION: Other events ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 19970123 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: COMERICA INC /NEW/ CENTRAL INDEX KEY: 0000028412 STANDARD INDUSTRIAL CLASSIFICATION: NATIONAL COMMERCIAL BANKS [6021] IRS NUMBER: 381998421 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-07269 FILM NUMBER: 97509467 BUSINESS ADDRESS: STREET 1: COMERICA TOWER AT DETROIT CENTER CITY: DETROIT STATE: MI ZIP: 48243 BUSINESS PHONE: 3132224000 MAIL ADDRESS: STREET 1: 411 W LAFAYETTE MAIL CODE 3415 STREET 2: ATTN JAY K OBERG CITY: DETROIT STATE: MI ZIP: 48226 FORMER COMPANY: FORMER CONFORMED NAME: DETROITBANK CORP DATE OF NAME CHANGE: 19850311 8-K 1 FORM 8-K Page 1 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report: January 22, 1997 COMERICA INCORPORATED ----------------------------------------------------------- (Exact name of registrant as specified in its charter) Delaware 1-10706 38-1998421 - -------------------------------------------------------------------------------- (State or other (Commission File (I.R.S. Employer jurisdiction of Number) Identification incorporation) Number) Comerica Tower at Detroit Center 48226 Detroit, Michigan - -------------------------------------------------------------------------------- (Address of principal executive offices) (Zip Code) (313) 222-3432 ------------------------------------------------------- (Registrant's telephone number, including area code) N/A ------------------------------------------------------------- (Former name or former address, if changed since last report) Page 2 Item 5. Other Events. Pursuant to Form 8-K, General Instruction F, Registrant hereby incorporates by reference the press releases attached hereto as Exhibits 99.1, 99.2, and 99.3. Item 7. Financial Statements, PRO FORMA Financial Information and Exhibits. (c) Exhibits. Exhibit No. Description Page - -------------- -------- 99.1 Comerica Incorporated Press Release 4 dated January 22, 1997 regarding earnings 99.2 Comerica Incorporated Press Release 7 dated January 22, 1997 regarding results of Phase III 99.3 Consolidated Balance Sheets 9 Page 3 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. Comerica Incorporated (Registrant) BY: /s/ Mark W. Yonkman ------------------------------------ Name: Mark W. Yonkman Title: First Vice President and Assistant Secretary Dated: January 22, 1997 EX-99.1 2 PRESS RELEASE-COMERICA EARNINGS - -------------------------------------------------------------------------------- Page 1 - -------------------------------------------------------------------------------- EXHIBIT 99.1 COMERICA REPORTS 1996 EARNINGS DETROIT/January 22, 1997 -- Comerica Incorporated (NYSE: CMA) today reported 1996 earnings per share of $3.55, compared to $3.54 in 1995. Net income was $417 million, up one percent from $413 million for 1995. Return on common equity was 15.98 percent and return on assets was 1.22 percent, compared to 16.46 percent and 1.21 percent, respectively, for 1995. Included in 1996 results was a fourth quarter pre-tax charge of $90 million associated with a comprehensive restructuring to improve customer service, increase efficiency, enhance revenue and provide funding for future growth, called Phase III of Direction 2000. Excluding this charge, net income for the year would have been $477 million, or $4.08 per share. Return on common equity and return on assets for the year would have been 18.33 percent and 1.40 percent, respectively. Net income for the fourth quarter of 1996 was $61 million or $0.52 per share, compared to $107 million or $0.92 for the same period in 1995, decreases of 43 percent. Return on common equity was 9.42 percent and return on assets was 0.72 percent, compared to 16.49 percent and 1.23 percent, respectively, for the fourth quarter of 1995. Excluding the restructuring charge, net income and earnings per share would have been $121 million and $1.06, respectively. Return on common equity would have been 19.41 percent and return on assets would have been 1.44 percent. "We are pleased with our financial performance, particularly in the fourth quarter, as we systematically reconsidered everything we do at Comerica in order to identify ways to improve customer service and increase efficiency," said Eugene A. Miller, chairman and chief executive officer. "We completed an intensive review of our operations without sacrificing revenue momentum or our commitment to high asset quality. As a result, we believe we have created a solid foundation for future success." - more - - -------------------------------------------------------------------------------- Page 2 - -------------------------------------------------------------------------------- COMERICA REPORTS 1996 EARNINGS - 2 Net interest income for the fourth quarter of 1996 was up 4 percent compared to the similar period in 1995, as a result of loan growth and an increase in the net interest margin. Average loans, excluding the sale of the Corporation's Illinois subsidiary, increased $2.3 billion, or 10 percent, over last year's fourth quarter. The increase in net interest margin, from 4.31 percent for the comparable quarter of 1995 to 4.61 percent for the fourth quarter of 1996, was due primarily to a favorable change in the mix of earning assets -- growth in higher yielding loans and a decline in lower return investment securities. Noninterest income was $132 million for the fourth quarter of 1996, compared to $141 million for the same quarter last year. This decrease was principally due to the sale of the Corporation's customhouse brokerage subsidiary in the second quarter of this year. Customhouse broker fees contributed nearly $9 million to fourth quarter 1995 noninterest income. Noninterest expenses were $356 million for the fourth quarter of 1996, compared to $288 million for the same period last year. The $90 million restructuring charge included in noninterest expenses for the fourth quarter of 1996 includes $48 million for termination benefits, $21 million for occupancy and equipment charges and $21 million for other expenses. Fourth quarter expenses for 1996 also include an $18 million charge related to increased estimates of projected losses over the remaining loss sharing period on a bankcard portfolio the Corporation sold at the end of 1995. The provision for loan losses was $32 million in the fourth quarter of 1996, a decrease of $1 million compared to the same period in 1995. Net charge-offs for the quarter were $22 million or 0.35 percent of average total loans, compared with $36 million or 0.59 percent in the fourth quarter of 1995. Nonperforming assets were $140 million or 0.53 percent of loans and other real estate at December 31, 1996, compared to $163 million or 0.67 percent at December 31, 1995. - more - - -------------------------------------------------------------------------------- Page 3 - -------------------------------------------------------------------------------- COMERICA REPORTS 1996 EARNINGS - 3 At December 31, 1996, assets totaled $34 billion, compared with $35 billion one year earlier, and common shareholders' equity was $2.4 billion, compared to $2.6 billion in 1995. During 1996, 13 million shares were repurchased under existing share repurchase authorizations compared to 4.3 million in 1995. Total loans at year-end were $26 billion, compared to $24 billion a year earlier, and year-end deposits were $22 billion, compared to $23 billion at December 31, 1995. Comerica Incorporated is a bank holding company headquartered in Detroit that operates banking subsidiaries in Michigan, California, Texas and Florida. ### MEDIA CONTACTS: INVESTOR CONTACT: Sharon R. McMurray Allison T. McFerren (313) 222-4881 (313) 222-6317 Wayne J. Mielke (313) 222-4732 EX-99.2 3 PRESS RELEASE-COMERICA RESULTS Page 1 EXHIBIT 99.2 COMERICA ANNOUNCES RESULTS OF PHASE III DETROIT/January 22, 1997 -- Comerica Incorporated (NYSE: CMA) today announced the completion of a comprehensive effort to improve customer service, increase efficiency, enhance revenue and provide funding for future growth. The results will help move Comerica toward its goal of consistent first quintile financial performance, as measured by return on equity among the top 50 bank holding companies in the nation. In addition to supporting future investments in growth businesses, geographic expansion, marketing, technology and talent, the results of Phase III of Direction 2000 are expected to reduce overhead costs and enhance revenues by $110 million on an annualized basis, when fully implemented by the first half of 1998. "We began this effort from a position of strength, and emerge from it even stronger," said Comerica Chairman and Chief Executive Officer Eugene A. Miller. "Over a four-month period, our employees worked diligently to scrutinize everything that we do while conducting business as usual, as always with the highest level of professionalism. We now are implementing their ideas to simplify and streamline our processes to ensure we are using our resources as efficiently as possible, and to provide substantial resources for future growth." Among the ideas to be implemented over the next 15 months are the following: - - Eliminating one-third of paper forms and replacing them with electronic forms. - - Simplifying the referral and delivery of investment services. - - Empowering branch employees with additional levels of authority, and reducing their clerical responsibilities, so they can serve customers better. - - Automating loan documentation to accelerate customer response times. - - Reducing the documentation required to open a new account. - - Leveraging vendor agreements corporate-wide. - - Streamlining the credit approval process. - - Streamlining financial and operations reporting. - more - Page 2 COMERICA ANNOUNCES RESULTS OF PHASE III - 2 "Regrettably," Miller noted, "as we streamline processes and eliminate redundancies, a number of employees throughout the corporation will be displaced. To assist these employees, we have put in place an enhanced severance plan with outplacement services to help their transition." Comerica expects to eliminate 1,890 positions. The combination of normal attrition, hiring limitations in effect from the beginning of the project, and reinvestment is expected to reduce the actual number of layoffs in the workforce. To recognize costs associated with this project, Comerica incurred a $90 million pre-tax restructuring charge in the fourth quarter of 1996. Phase III was conducted by Comerica employees with the assistance of Tandon Capital Associates, Inc., a New York-based advisory firm. Comerica Incorporated is a bank holding company headquartered in Detroit that operates banking subsidiaries in Michigan, California, Texas and Florida. It reported total assets of $34 billion at year-end 1996. * * * NOTE: This news release contains forward-looking statements about expected savings and other effects of Phase III which are subject to risks and uncertainties that could cause actual results to differ materially. These risks and uncertainties include unanticipated changes in the competitive environment. # # # MEDIA CONTACT: INVESTOR CONTACT: Sharon R. McMurray Allison T. McFerren (313) 222-4881 (313) 222-6317 EX-99.3 4 BALANCE SHEET, STATEMENT OF INCOME, FIN. EXHIBIT 99.3 CONSOLIDATED BALANCE SHEETS COMERICA INCORPORATED AND SUBSIDIARIES - ------------------------------------------------------------------------------- December 31, December 31, (IN THOUSANDS, EXCEPT SHARE DATA) 1996 1995 - ------------------------------------------------------------------------------- ASSETS Cash and due from banks $ 1,901,760 $ 2,028,375 Interest-bearing deposits with banks 27,329 23,568 Federal funds sold and securities purchased under agreements to resell 32,200 203,798 Trading account securities 6,009 10,668 Loans held for sale 38,069 511,562 Investment securities available for sale 4,800,034 6,859,310 Commercial loans 13,520,246 12,041,009 International loans 1,706,388 1,384,814 Real estate construction loans 750,760 641,432 Commercial mortgage loans 3,445,562 3,254,041 Residential mortgage loans 1,743,876 2,221,359 Consumer loans 4,634,258 4,570,015 Lease financing 405,618 329,608 - ------------------------------------------------------------------------------- Total loans 26,206,708 24,442,278 Less allowance for loan losses (367,165) (341,344) - ------------------------------------------------------------------------------- Net loans 25,839,543 24,100,934 Premises and equipment 407,663 455,002 Customers' liability on acceptances outstanding 33,102 21,135 Accrued income and other assets 1,120,362 1,255,522 - ------------------------------------------------------------------------------- Total assets $34,206,071 $35,469,874 - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- LIABILITIES AND SHAREHOLDERS' EQUITY Demand deposits (noninterest-bearing) $ 6,712,985 $ 5,579,536 Interest-bearing deposits 15,357,840 15,461,213 Deposits in foreign offices 296,348 2,126,466 - ------------------------------------------------------------------------------- Total deposits 22,367,173 23,167,215 Federal funds purchased and securities sold under agreements to repurchase 1,395,540 3,206,612 Other borrowed funds 3,093,651 1,467,550 Acceptances outstanding 33,102 21,135 Accrued expenses and other liabilities 459,267 355,219 Medium- and long-term debt 4,241,769 4,644,416 - ------------------------------------------------------------------------------- Total liabilities 31,590,502 32,862,147 Nonredeemable preferred stock - $50 stated value: Authorized - 5,000,000 shares Issued - 5,000,000 shares at 12/31/96 250,000 - Common stock - $5 par value: Authorized - 250,000,000 shares Issued - 107,297,345 shares at 12/31/96, 115,094,531 shares at 12/31/95 536,487 575,473 Capital surplus - 410,618 Unrealized gains and losses on investment securities available for sale (22,789) (4,141) Retained earnings 1,854,116 1,640,980 Deferred compensation (2,245) (1,974) Less cost of common stock in treasury-490,704 shares at 12/31/95 - (13,229) - ------------------------------------------------------------------------------- Total shareholders' equity 2,615,569 2,607,727 - ------------------------------------------------------------------------------- Total liabilities and shareholders' equity $34,206,071 $35,469,874 - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- CONSOLIDATED STATEMENTS OF INCOME Comerica Incorporated and Subsidiaries
- ----------------------------------------------------------------------------------------------------------------------------------- Three Months Ended Year Ended December 31 December 31 - ----------------------------------------------------------------------------------------------------------------------------------- (IN THOUSANDS, EXCEPT PER SHARE DATA) 1996 1995 1996 1995 - ----------------------------------------------------------------------------------------------------------------------------------- INTEREST INCOME Interest and fees on loans $ 543,083 $ 540,761 $2,160,981 $2,090,854 Interest on investment securities: Taxable 84,498 120,120 372,331 473,759 Exempt from federal income tax 3,189 5,975 17,443 26,189 - ----------------------------------------------------------------------------------------------------------------------------------- Total interest on investment securities 87,687 126,095 389,774 499,948 Trading account interest 54 58 210 227 Interest on federal funds sold and securities purchased under agreements to resell 756 1,361 5,068 7,402 Interest on time deposits with banks 395 482 1,827 8,032 Interest on loans held for sale 762 1,875 4,920 7,461 - ----------------------------------------------------------------------------------------------------------------------------------- Total interest income 632,737 670,632 2,562,780 2,613,924 INTEREST EXPENSE Interest on deposits 165,161 183,281 685,539 721,475 Interest on short-term borrowings: Federal funds purchased and securities sold under agreements to repurchase 34,059 47,616 111,729 165,544 Other borrowed funds 22,343 23,617 107,155 135,667 Interest on medium-and long-term debt 70,750 77,857 294,990 288,990 Net interest rate swap (income)/expense (12,837) (2,761) (48,911) 2,365 - ----------------------------------------------------------------------------------------------------------------------------------- Total interest expense 279,476 329,610 1,150,502 1,314,041 - ----------------------------------------------------------------------------------------------------------------------------------- Net interest income 353,261 341,022 1,412,278 1,299,883 Provision for loan losses 32,000 33,000 114,000 86,500 - ----------------------------------------------------------------------------------------------------------------------------------- Net interest income after provision for loan losses 321,261 308,022 1,298,278 1,213,383 NONINTEREST INCOME Income from fiduciary activities 34,094 31,175 133,482 125,038 Service charges on deposit accounts 35,075 33,111 140,436 130,249 Customhouse broker fees - 8,949 10,764 36,086 Revolving credit fees 5,935 10,020 22,670 36,248 Securities gains 10,194 10,960 13,588 11,748 Other noninterest income 47,110 46,350 186,014 159,356 - ---------------------------------------------------------------------------------------------------------------------------------- Total noninterest income 132,408 140,565 506,954 498,725 NONINTEREST EXPENSES Salaries and employee benefits 136,769 141,785 560,784 562,159 Net occupancy expense 22,821 25,639 99,211 98,945 Equipment expense 17,483 17,202 68,827 67,872 FDIC insurance expense 695 2,399 8,139 23,817 Telecommunications expense 7,659 7,617 29,092 29,644 Restructuring charge 90,000 - 90,000 - Other noninterest expenses 80,793 93,803 302,973 303,977 - ----------------------------------------------------------------------------------------------------------------------------------- Total noninterest expenses 356,220 288,445 1,159,026 1,086,414 - ----------------------------------------------------------------------------------------------------------------------------------- Income before income taxes 97,449 160,142 646,206 625,694 Provision for income taxes 36,633 53,632 229,045 212,328 - ----------------------------------------------------------------------------------------------------------------------------------- NET INCOME $ 60,816 $ 106,510 $ 417,161 $ 413,366 - ----------------------------------------------------------------------------------------------------------------------------------- Net income applicable to common stock $ 56,541 $ 106,510 $ 408,136 $ 413,366 - ----------------------------------------------------------------------------------------------------------------------------------- Primary net income per share $ 0.52 $ 0.92 $ 3.55 $ 3.54 Average common and common equivalent shares 109,703 116,041 114,854 116,894 Cash dividends declared on common stock $ 41,789 $ 40,072 $ 170,067 $ 158,309 Dividends per common share $ 0.39 $ 0.35 $ 1.52 $ 1.37 - -----------------------------------------------------------------------------------------------------------------------------------
CONSOLIDATED FINANCIAL HIGHLIGHTS COMERICA INCORPORATED AND SUBSIDIARIES
- ------------------------------------------------------------------------------------------------------------- Three Months Ended Year Ended (IN THOUSANDS, EXCEPT PER SHARE DATA, December 31 December 31 AVERAGE BALANCES AND RATIOS) 1996 1995 1996 1995 - ------------------------------------------------------------------------------------------------------------- PER SHARE AND COMMON STOCK DATA Net income $0.52 $0.92 $3.55 $3.54 Net income (excluding restructuring charge) 1.06 N/A 4.08 N/A Cash dividends declared 0.39 0.35 1.52 1.37 Common shareholders' equity (at December 31) 22.05 22.75 Average common and common equivalent shares 109,703 116,041 114,854 116,894 - ------------------------------------------------------------------------------------------------------------- KEY RATIOS Return on average common 9.42% 16.49% 15.98% 16.46% equity Return on average common equity (excluding restructuring 19.41% N/A 18.33% N/A charge) Return on average assets 0.72% 1.23% 1.22% 1.21% Return on average assets (excluding restructuring charge) 1.44% N/A 1.40% N/A Average common equity as a percentage of average assets 7.13% 7.46% 7.47% 7.36% Core capital ratio 7.18% 7.63% Total capital ratio 10.99% 11.21% Leverage ratio 7.07% 6.87% - ------------------------------------------------------------------------------------------------------------- AVERAGE BALANCES (in millions) Commercial loans (including lease financing) $13,323 $11,902 $13,037 $11,587 International loans 1,670 1,421 1,541 1,257 Real estate construction loans 744 632 707 541 Commercial mortgage loans 3,424 3,201 3,483 3,157 Residential mortgage loans 1,760 2,398 1,960 2,450 Consumer loans 4,574 4,809 4,624 4,569 - ------------------------------------------------------------------------------------------------------------- Total loans $25,495 $24,363 $25,352 $23,561 Earning assets 30,744 31,942 31,370 31,537 Total assets 33,645 34,631 34,195 34,129 Interest-bearing deposits 16,088 16,927 16,669 16,888 Noninterest-bearing deposits 5,791 4,980 5,589 4,767 Total interest-bearing liabilities 24,781 26,700 25,519 26,527 Common shareholders' equity 2,400 2,584 2,554 2,511 - ------------------------------------------------------------------------------------------------------------- NET INTEREST INCOME Net interest income (fully taxable equivalent basis) $356,116 $345,285 $1,426,976 $1,320,959 Fully taxable equivalent 2,855 4,263 14,698 21,076 adjustment Net interest margin 4.61% 4.31% 4.54% 4.19% - ------------------------------------------------------------------------------------------------------------- CREDIT QUALITY Nonaccrual loans $103,294 $130,403 Reduced-rate loans 8,009 3,244 Other real estate 28,398 29,384 Total nonperforming assets 139,701 163,031 Loans 90 days past due 51,748 57,134 Gross charge-offs 35,258 45,197 $125,912 $119,028 Recoveries 12,967 9,219 41,363 43,009 Net charge-offs 22,291 35,978 84,549 76,019 - ------------------------------------------------------------------------------------------------------------- Allowance for loan losses as a percentage of total loans 1.40% 1.40% Nonperforming assets as a percentage of total loans and other real estate 0.53% 0.67% Net loans charged off as a percentage of average total loans 0.35% 0.59% 0.33% 0.32% Allowance for loan losses as a percentage of total nonperforming assets 263% 209% - ------------------------------------------------------------------------------------------------------------- ADDITIONAL DATA Goodwill $250,926 $228,106 Core deposit intangible 28,688 35,009 Other intangibles 5,709 8,632 Mortgage servicing rights 22,744 15,817 - -------------------------------------------------------------------------------------------------------------
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