Comerica Incorporated

Hello and thank you for standing by and welcome to the Comerica third quarter 2022 earnings conference call. At this time, all participants are in listen only mode. After the speaker's remarks, there will be a question and answer session. To ask a question during this session, you will need to press one then zero on your telephone. To withdraw your question, press one then zero again. I would now like to turn the conference over to Kelly Gage, Director of Investor Relations. Please go ahead.

Thanks, Brad. Good morning, everyone, and welcome to Comerica's third quarter 2022 earnings conference call. Participating on this call will be our President, Chairman, and CEO, Kurt Farmer, Chief Financial Officer, Jim Herzog, Chief Credit Officer, Melinda Chausse, and Executive Director of our commercial bank, Peter Sebsic. During this presentation, we will be referring to slides which will provide additional details. The presentation and slides Presentation slides and our press release are available on the SEC's website, as well as in the investor relations section of our website, Comerica.com. This conference call contains forward-looking statements. In that regard, you should be mindful of the risks and uncertainties that can cause actual results to vary materially from expectations. Forward-looking statements speak only as of the date of this presentation, and we undertake no obligation to update any forward-looking statements. Also, this conference call will reference non-GAAP measures. And in that regard, I direct you to the reconciliation of these measures on our website, Comerica.com. Please refer to the safe harbor statement in today's earnings release on slide two, which is incorporated into this call, as well as our SEC filings for factors that can cause actual results to differ. Now I'll turn our call over to Kurt, who will begin on slide three.

Good morning, everyone. Thank you for joining our call. Today we reported third quarter 2022 results, including record earnings of $351 million, or $2.60 per share, an increase of 35% over the second quarter. We generated excellent financial results with all-time high revenue of $985 million, up 19%, improved our efficiency ratio to 51%, and maintained a strong credit position, with our percentage of criticized loans well below our historical average. We continue to benefit not only from the rising rate environment, but also from investments in strategic management of our business to support long-term success. We produce another quarter of broad-based loan growth and continue to generate solid fee income. While our customers are closely monitoring recessionary risk and its potential impacts, they remain generally confident in their ability to successfully navigate the changing landscape. Corporate responsibility remains a priority as we continue to demonstrate our commitment to supporting economic growth in our local communities. We announced a dedicated business banking team for the southern sector of Dallas County with a mandate to provide capital solutions for underserved entrepreneurs and small businesses. We enhanced our national community impact manager role responsible for leading our public purpose and community impact investments. Our green loans and commitments continue to grow and total $2.2 billion at quarter end. Our recently announced renewables group is already off to a strong start with over $200 million in new commitments here today and a growing pipeline. We are incredibly proud of our community impact and financial results, and we continue to focus our efforts on the future. Through our modernization initiatives, we are making strategic investments to adapt to the changing landscape and move into a new era of banking. We announced an expanded office footprint in Frisco, Texas and Farmington Hills, Michigan, commitments we are excited to make in important markets. These innovation hubs deliver an enhanced colleague work experience and assist us in attracting and retaining top talent. Also, We realigned our organization to create an even more synergistic structure, supporting our commercial banking expertise, while adding transformational leadership and payments. We believe this structure will better serve the comprehensive and evolving needs of our customers, allowing us to deepen relationships and enhance revenue. Further, in conjunction with our strategic modernization objectives, we refreshed our company's core values. Driving collaboration, encouraging bold thinking and behaviors, and empowering our employees, all while remaining centrally focused on our customer, is critical to achieving continued success. Let's review the highlights of our third quarter results on slide four. Following second quarter's significant loan growth, third quarter activity remained strong. Average loans were up 1.1 billion, reflecting increases across a number of businesses, the largest being commercial real estate, national dealer services, environmental services, and wealth management. Commercial real estate benefited from the continued build-out of projects and the pace of payoffs normalizing due to the rate environment. We have made selective investments to expand our wealth management business, and we are excited to see the growth and momentum this quarter. Other business lines saw merger and acquisition activity and continued investment in working capital, albeit at a slower pace in the second quarter. We continued to strategically manage deposits as customers draw down on their operating accounts and seek higher yielding products for excess balances. We made significant progress on our hedging strategy, which should help insulate earnings through rate cycles. Yet, we maintained most of the benefit from higher rates which combined with the growth in our loan and securities portfolios drove record net interest income. Credit quality remained excellent and fee income strong with increased derivative activity. Expenses were driven by performance-based compensation and investments to support growth. Our efficiency ratio further improved to 51% as a result of record revenue and solid expense management. Retention of earnings drove our CET1 ratio back up to an estimated 9.92%. Overall, an excellent quarter, and we feel very positive about the trajectory of our business as we move through the remainder of the year. And now I'll turn the call over to Jim, who will review the quarter in more detail.