Comerica Inc.'s second-quarter profit soared, beating analysts' estimates, as its loan-loss provisions fell sharply.
However, revenue missed expectations like other banks.
The company's results "reflect the many positive trends we have seen over several quarters," said Chairman and Chief Executive Ralph W. Babb Jr. "This includes three consecutive quarters of broad-based improvement in credit quality, with leading indicators of future credit quality also pointing positive."
Comerica--which has banks in hard-hit Michigan, Arizona, Florida and California--has seen results improve recently, like many other banks, from cutbacks on money set aside for potential loan losses. In May, Standard & Poor's Ratings Services boosted its outlook on Comerica, saying it expects the bank's bottom line to improve in the near term.
Comerica reported a profit of $70 million, or 39 cents a share, up from $18 million a year earlier. Revenue fell 12% to $616 million as noninterest income tumbled 35% amid prior-year securities gains.
Analysts polled by Thomson Reuters had most recently forecast earnings of 23 cents on $621 million in revenue.
Loan-loss provisions were $126 million, down from $312 million a year earlier and $175 million in the prior quarter. Net charge-offs, or loans lenders don't think are collectible, fell to 1.44% of average loans from 2.08% and 1.68%, respectively. Nonperforming loans, those near default, were 2.98%, compared with 2.64% and 3.06%.
Total loans fell 15%, while total core deposits jumped 11%.
Shares closed at $36.81 Tuesday and were inactive premarket. The stock has risen 79% in the past year.
