Comerica 2014 Annual Report Download - page 50

F-13
the lower interest rate environment, partially offset by the benefit provided by a $135 million increase in average loans and lower
deposit rates. Average deposits increased $463 million. The provision for credit losses was a benefit of $5 million in 2014, compared
to a provision of $13 million in 2013. Net credit-related charge-offs of $11 million in 2014 decreased $11 million compared to
2013, reflecting decreases in both Small Business and Retail Banking. Noninterest income of $167 million in 2014 decreased $8
million compared to 2013, primarily due to a $5 million decrease in income from the Corporation's third-party credit card provider,
largely reflecting a change in the timing of the recognition of incentives from annually to quarterly in the third quarter 2013.
Noninterest expenses of $702 million in 2014 decreased $6 million from the prior year, primarily due to a $5 million decrease in
salaries and benefits expense and small decreases in several other noninterest expense categories, partially offset by a $7 million
increase in corporate overhead expense, largely for the same reasons as described above in the Business Bank discussion.
Wealth Management's net income of $91 million in 2014 increased $4 million, compared to $87 million in 2013. Net
interest income (FTE) of $186 million in 2014 increased $2 million compared to 2013, as the benefit provided by a $161 million
increase in average loans was largely offset by a decline in loan yields. Average deposits increased $259 million. The provision
for credit losses was a benefit of $20 million in 2014, compared to a benefit of $18 million in 2013. Net credit-related recoveries
were $1 million in 2014, compared to charge-offs of $8 million in 2013. Noninterest income of $259 million increased $7 million
from the prior year, primarily reflecting a $10 million increase in fiduciary income, partially offset by small decreases in several
other categories of noninterest income. Noninterest expenses of $322 million in 2014 increased $3 million from the prior year,
primarily due to a $5 million increase in corporate overhead expense and a $5 million increase in litigation-related expenses,
partially offset by a decrease of $8 million in salaries and benefits expense. See the Business Bank discussion for an explanation
of the increase in corporate overhead expense.
The net loss in the Finance segment was $357 million in 2014, compared to a net loss of $376 million in 2013. Net
interest expense (FTE) of $662 million in 2014 increased $9 million, compared to 2013, primarily reflecting an increase in net
FTP expense as a result of higher deposit levels in the business segments, partially offset by lower net rates paid to the business
segments under the Corporation's internal FTP methodology. Noninterest income of $60 million in 2014 decreased $1 million
compared to 2013. A decrease in noninterest expenses of $31 million in 2014 was primarily the result of the third quarter 2014
gain of $32 million on the early redemption of debt.
MARKET SEGMENTS
The table and narrative below present the market segment results, including prior periods, based on the structure and
methodologies in effect at December 31, 2014. Note 22 to these consolidated financial statements presents a description of each
of these market segments as well as the financial results for the years ended December 31, 2014, 2013 and 2012.
The following table presents net income (loss) by market segment.
(dollar amounts in millions)
Years Ended December 31 2014 2013 2012
Michigan $ 297 31% $ 261 29% $ 315 33%
California 272 29 268 29 253 27
Texas 160 17 177 19 181 19
Other Markets 221 23 208 23 194 21
950 100% 914 100% 943 100%
Finance & Other (a) (357) (373) (422)
Total $ 593 $ 541 $ 521
(a) Includes items not directly associated with the market segments.
The Michigan market's net income of $297 million in 2014 increased $36 million, compared to net income of $261 million
in 2013. Net interest income (FTE) of $718 million in 2014 decreased $33 million, primarily due to lower loan yields, partially
due to the impact of a $9 million negative residual value adjustment to assets in the leasing portfolio and the impact of a $125
million decrease in average loans. Average deposits increased $677 million. The provision for credit losses was a benefit of $32
million in 2014, a decrease of $20 million compared to a benefit of $12 million in the prior year. Net credit-related charge-offs of
$8 million for 2014 increased $2 million from the prior year, primarily reflecting increases in general Middle Market and
Commercial Real Estate, partially offset by decreases in most other lines of business. Noninterest income of $360 million in 2014
increased $3 million from 2013, primarily due to small increases in several noninterest income categories. Noninterest expenses
of $644 million in 2014 decreased $70 million from the prior year, primarily reflecting a $47 million decrease in litigation-related
expenses, an $8 million decrease in salaries and benefits expense and small decreases in several noninterest expense categories,
partially offset by a $7 million increase in corporate overhead expenses. See the Business Bank discussion for an explanation of
the increase in corporate overhead expense.
The California market's net income of $272 million increased $4 million in 2014, compared to $268 million in 2013. Net
interest income (FTE) of $722 million for 2014 increased $30 million from the prior year, primarily due to the benefit provided