The downbeat forecast and commentary added to the gloom in the industry, which is bracing for a margin hit as deposit costs climb and borrowing slows in a high interest rate environment.
Dallas-based Comerica expects average loans to dip between 1% and 2% in 2024. Its NII forecast was also slightly wider than Wall Street’s expectations of a near 10% drop, according to LSEG data.
Comerica’s fourth-quarter profit fell 91% to $33 million, or 20 cents per share.
The steep drop was primarily due to a special assessment fee that banks are required to pay to the Federal Deposit Insurance Corp to replenish its deposit insurance fund, which was drained out during the recent banking crisis.
The fee has weighed heavily on bank earnings this quarter.
Comerica’s NII, however, hit a record high in 2023.
(This story has been refiled to correct syntax in paragraph 1)
Source: Economy - investing.com
