Comerica 2Q13 Earnings Call Notes

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This post is part of a series of posts called “Company Notes.” These posts contain quotes and exhibits from earnings calls, conference presentations, analyst days and SEC filings. The quotes are generally pieces of information that I find interesting or helpful to understanding the company, industry or economy and are not meant to provide summaries of the full content of the call. Other posts in this series can be found by clicking here. Full transcripts can be found at Seeking Alpha.

“Overall, customers remain cautious but relatively more positive in this slow-growing economy.”

“Credit quality was solid in the second quarter, with net charge-offs of 15 basis points, which is the lowest level since the first quarter of 2007. ”

“On July 2, the Federal Reserve approved its final version of the Basel III capital rules. We estimate that our June 30, 2013, Basel III Tier 1 Common ratio is 10.1% on a fully phased-in basis. This is well in excess of the minimum requirement”

” Texas continues to be a growth leader for the U.S. economy, with strong high-tech and energy sectors. ”

“California residential real estate markets are quickly improving, and home prices are increasing in all major metropolitan areas.”

“line utilization increased to 48.2% from 47.7% at the end of the first quarter.”

“as you know, we typically price with the shorter end of the yield curve, as Karen mentioned earlier. So as you’re seeing a steepening in the yield curve, that hasn’t had as much kind of impact on us. Obviously, the hiccup in the leveraged loan market did move, I think, some activity like to the shorter end of the yield curve, which helps senior bank debt. But overall, I don’t think the interest rate shifts have really had any significant impact on us. And as you know, LIBOR really hasn’t significantly changed. So we’re staying very focused on our existing strategy. We haven’t changed our pricing strategy at all, John.”

“I would say that we have continued to see a very aggressive marketplace in terms of pricing. And if I look back a couple of quarters ago to today, I would say that it has gotten relatively more aggressive. ”

“When rates did rise last month, we did move back in the market to purchase securities. Today, we’re seeing yields in the 2.20 to 2.50 range.”

“Steven, frankly, we haven’t really seen a significant change in terms of, I would say, the wealth effect in terms of business owners. Where I think we’ve seen more activity there would probably be in our Wealth business.”

“Where you primarily have seen a reduction in deposit balances has been in general Middle Market Banking. And frankly, that’s when we’re seeing good, stable loan growth. So I think a number of those companies are putting now liquidity to work.”

“We obviously try to build in a prepayment penalty into every transaction and every relationship we can because there is a cost to liquidity associated with it. But it’s part of the larger pricing of the overall relationship that we have. But I would say from a general industry perspective that, that is clearly kind of an area that has given along with durations and advanced rates and a number of other areas.”