Comerica Incorporated (CMA) beat first-quarter earnings estimates by controlling costs and reducing bad loans.
The Dallas company reported quarterly profit of $134 million, 3% higher than the first quarter of 2012. Per-share earnings of 70 cents were 2 cents higher than the estimates of analysts polled by Bloomberg.
Comerica's income from interest and fees dropped in the quarter, but cost reductions of more than $30 million helped lift profits. Total noninterest expenses fell to $416 million, 7% lower than the year-prior period, as the $65 billion-asset company lowered its expenses for salaries and benefits, real estate, advertising and Federal Deposit Insurance Corp. insurance.
Meanwhile, its net interest expense fell 6%, to $416 million. A $5 million decline in loan expense, to $30 million, partially offset a $31 million, or 6%, drop in interest income, to $446 million.
Noninterest income fell 3%, to $200 million, as service charges, commercial lending fees and insurance income dropped.
An improving loan portfolio helped offset declining income. Comerica's provision for loan losses fell 27%, to $16 million, and chargeoffs fell 46%, to $24 million. Nonperforming loans declined 40%, to $515 million.