Comerica Incorporated (NYSE:CMA) Q2 2023 Earnings Call Transcript

James Herzog: Yes. We’re pretty neutral right now, Chris, in terms of our interest rate positioning. So we don’t think it would be an impact regardless of what the Fed does. We are just the slightest bit for the downside for both an up and down rate scenario. I would say the longer the Fed holds rates at a high level, I do think that’s probably puts a little more pressure and less pressure on our projections because I do think you have the potential for a very, very slow bleed if they’re kept high for a very extended period of time in terms of betas and deposit flows. I don’t think it’s material, but I don’t think it’s necessarily helpful to have them elevated for an extended period of time.

Christopher McGratty: Great. And then my follow-up on capital. I’m interested in your thoughts on what would need to happen to return to a buyback? Obviously, we know the regulatory is an aspect. But what is it specifically that would be the moment where you would turn it back on?

James Herzog: Yes, I would say two things, Chris. One, obviously, stabilization in the overall banking industry. And I think we’re doing most of it, but I think that we’re not 100% as an industry out of the woods, yet, even though things are very stable to Comerica, so certainly, stability there would be good. And then obviously, once we understand, receive and understand the new capital rules as soon as we can get comfortable, and we are comfortable right now, but we’ll wait and see how comfortable we are once the rules come out. Once we have some degree of certainty that we can hit our targets based on the new rules, I think, that would put us in a position to really start thinking about share buyback.

Christopher McGratty: Good. Thank you.

James Herzog: Thank you.

Operator: And at this time, there are no further questions. I’d like to turn the call back to Curt Farmer, President, Chairman and Chief Executive Officer.

Curtis Farmer: Well, thank you so much, everyone, for dialing in and listening to the call today. As always, we appreciate your interest in our company, and hope you have a good day. Thank you.

Operator: Ladies and gentlemen, that does conclude your conference for today. Thank you for your participation and for using AT&T teleconference. You may now disconnect.