Comerica Incorporated

Hello, and thank you for standing by. Welcome to the Comerica first quarter 2023 earnings conference call. At this time, all participants are in a 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 1-0 on your telephone keypad. To withdraw your question, press 1-0 again. I would now like to turn the conference over to Kelly Gage, Director of Investor Relations. Please go ahead.

Thanks, Leah. Good morning and welcome to Comerica's first quarter 2023 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 Chief Director of Banking, Peter Subsek. During this presentation, we'll be referring to slides which provide additional details. The 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, and 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. Please refer to the safe harbor statement on 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. Also, this conference call will reference non-GAAP measures. And in that regard, I will direct you to the reconciliation of these measures and the earning materials that are available on our website, Comerica.com. Now I'll turn the call over to Kurt, who will begin on slide three.

Good morning, everyone, and thank you for joining our call. Today we reported first quarter earnings per share of $2.39 driven by continued loan growth, a favorable rate environment, and effective management of balance sheet, credit, and capital. Despite the recent industry disruption, we affirmed the strength of our core deposit base by successfully retaining our relationships. While we saw some deposit pressure, it was predominantly localized and very manageable. Our credit risk management had us well prepared. Our effective liquidity strategy allowed us to remain laser focused on seamlessly supporting customers as we opened a significant number of new accounts. We remained focused on business as usual, winning new opportunities, attracting talent, underwriting credit, and expanding relationships. We believe our strong deposit franchise is now even more attractive and stable with a lower percentage of uninsured excess deposits and less concentration with price-sensitive customers. Moving to a summary of our results from slide four. Broad-based loan growth and increased non-interest income exceeded expectations. Credit remained a key strength for the quarter, and although we saw modest migration, we were starting from very low levels. Despite some pressures related to funding costs and expenses, we maintained a solid efficiency ratio and produce a robust ROE and Tier 1 capital ratio. Complementing our compelling financial results, we achieved significant milestones, including our new partnership with Ameriprise, aimed at further elevating our wealth management customer experience, digital tools, and capabilities. The launch of our new investment banking group and the national expansion of our small business banking platform strengthen our solutions for customers throughout their life cycles. Further, these initiatives advance the priority of increasing our mix of non-capital consuming fee income. Turning to slide five, we generated earnings of $324 million or $2.39 per share in the first quarter. Average loans grew almost $1.1 billion. Average deposits decreased $3.5 billion due primarily to normal quarter seasonality and customer utilization of funds related to Fed's monetary actions. Credit quality outperformed with net recoveries and our criticized loan percentage remained well below our historical average. Expenses were elevated due to tension and several larger notable items, but we maintained a solid efficiency ratio. In all, we retained our strong capital position with an estimated CET1 ratio of 10.09%. It was a remarkable quarter for Comerica, and I'm excited about our future and our ability to support our customers while delivering compelling results for our shareholders. And now I'll turn the call to Jim, who will review the quarter in more detail.