Comerica Annual Report 2006

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FY2006 Annual Report · Comerica

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2006 Annual Report
S TRATEGY FO R SUCCESS

Growth

Balance

Relationships

Risk Management

Accountability

Diversity

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Comerica Incorporated
Comerica Tower at Detroit Center
500 Woodward Avenue, MC 3391
Detroit, Michigan 48226

www.comerica.com

Financial Highlights

CONTENTS
1
2 At-a-Glance
4
8
14 Other Comerica Locations/Units
15 Board of Directors/Management Policy Committee
16

Shareholder Information

Letter to Shareholders

Strategy for Success

CORE VALUES

• Customer Service

• Diversity

• Ownership

• Teamwork

• Flexibility/Adapting to Change

• Trust/Integrity

• Learning and Personal Growth

CORPORATE PROFILE
Comerica Incorporated (NYSE: CMA) is a ﬁnancial services company, strategically aligned
into three business segments: The Business Bank, The Retail Bank, and Wealth & Institutional
Management. Comerica’s 11,270 colleagues focus on relationships, and helping people and
businesses be successful. Comerica Bank locations can be found in Michigan, California,
Texas, Arizona and Florida, with select businesses operating in several other states,
as well as in Canada, Mexico and China. To receive e-mail alerts of breaking Comerica
news, go to www.comerica.com/newsalerts.

Major League Baseball World Series Game 1
October 21, 2006, Comerica Park

COMERICA INCORPORATED
Comerica Tower at Detroit Center
500 Woodward Avenue, MC 3391, Detroit, Michigan 48226
(248) 371-5000 (metro Detroit)
(800) 521-1190 (outside metro Detroit area)
(800) 292-1300 (product information center)
www.comerica.com
www.comericajobs.com (career opportunities)

VISION

Comerica is in business to help people be successful. We are committed to
delivering the highest quality ﬁnancial services by:

• Providing outstanding value and building enduring customer relationships

• Creating a positive environment for our colleagues,

built on trust, teamwork and respect

• Demonstrating leadership in our communities

• Ensuring a consistent, superior return for our owners

FINANCIAL HIGHLIGHTS

(DOLLAR AMOUNTS IN MILLIONS, EXCEPT PER SHARE DATA)

Years Ended December 31
INCOME STATEMENT
Net interest income
Income from continuing operations*
Net income
Basic earnings per common share:

Income from continuing operations*

Net income
Diluted earnings per common share:

Income from continuing operations*

Net income
Cash dividends declared per common share
Book value per common share
Market value per common share

Average common shares outstanding – basic
Average common shares outstanding – diluted

2006

2005
$ 1,983 $ 1,956
816
861

782
893

CHANGE
AMOUNT PERCENT
1 %
(4)
4

27
(34)
32

4.88
5.57

4.81
5.49
2.36
32.70
58.68

160
162

4.90
5.17

(0.02)
0.40

–
8

4.84
5.11
2.20
31.11
56.76

167
169

(0.03)
0.38
0.16
1.59
1.92

(1)
7
7
5
3

(7)
(7)

(4)
(4)

RATIOS
Return on average assets*
Return on average common shareholders’ equity*
Average common shareholders’ equity
as a percentage of average assets
Tier 1 common capital as a percentage of risk-weighted assets
Tier 1 risk-based capital as a percentage of risk-weighted assets
Total risk-based capital as a percentage of risk-weighted assets

1.58 %
17.24
9.15

1.64 %

16.90
9.71

7.54
8.02
11.63

7.78
8.38
11.65

BALANCE SHEET (at December 31)
Total assets
Total earning assets
Total loans
Total deposits
Total common shareholders’ equity

$ 58,001 $ 53,013
48,646
54,052
43,247
47,431
42,431
44,927
5,068
5,153

4,988
5,406
4,184
2,496
85

9 %
11
10
6
2

* Income from continuing operations excludes the results of Munder Capital Management, a subsidiary sold in 2006 and reported as
a discontinued operation in all periods presented. Ratios are based on net income, which includes income from both continuing
and discontinued operations.

Net Income
(in Millions)

$861

$816

$893

$782

$757

$748

$658

$661

$658

$601

2002

2003

2004

2005

2006

Net income

Net income from continuing operations

Diluted Net Income
Per Common Share

$4.36

$4.31

$5.11

$4.84

$5.49

$4.81

$3.75

$3.73

$3.72

$3.40

2002

2003

2004

2005

2006

Diluted earnings per share

Diluted earnings per share from continuing operations
1

AT-A-GLANCE

THE BUSINESS BANK

Overview
The Business Bank provides companies with a complete
spectrum of credit and non-credit ﬁnancial products and
services, including cash management, trust and interna-
tional trade. Its relationship managers focus on developing,
maintaining and growing long-term relationships with cus-
tomers across all geographic markets.

2006 Achievements
• Average Middle Market loans were up 5 percent from
2005 to $15.4 billion, with the Western and Texas markets
contributing 72 percent of the growth

• Average Commercial Real Estate loans were $13.2 billion,
with growth of 24 percent, 10 percent and 24 percent, re-
spectively, in the fast-growing Western, Texas and Florida
markets

• National Dealer Services loans were at record levels for
the second year in a row, ﬁnishing the year at $5.5 billion
• Average Technology & Life Sciences loans increased 31

percent to $1.1 billion compared to 2005

• Global Corporate Banking opened a representative

ofﬁce in Shanghai, China

• In Mexico, Comerica enhanced its focus on dollar-based

activities through a representative ofﬁce in Monterrey

• Awarded the U.S. government’s Export-Import Bank’s

“Small Business Bank of the Year” award

• Expanded Private Equity, Financial Institutions and Munici-
palities businesses into the Texas and Western markets

• Created a new Middle Market lending unit specializing in

the waste management industry

• Opened a local developer real estate ofﬁce in Orlando,

Florida

• Launched a series of new Treasury Management prod-
ucts and services including Comerica Business Deposit
CaptureSM, Comerica Easy PaySM, Comerica Business Con-
nectSM and Comerica ACH Positive PaySM

Competitive Advantages
• Industry-leading credit training program with focus on

long-term relationship management and growth

• On average, senior managers have 15-20 years of
experience, and relationship managers have seven-and-
a-half years of experience

products over the next 18 months

• Optimize leadership role in check imaging and remote

capture

• Capitalize on North American lending platform to meet

evolving needs of business customers

• Expand specialty lending businesses into growth markets in
response to new opportunities and customer expectations
• Partner with Retail Bank and Wealth & Institutional Manage-

ment on cross-sell opportunities

THE RETAIL BANK
Overview
The Retail Bank delivers personalized ﬁnancial products and
services to consumers, entrepreneurs and small businesses.
Services are delivered through traditional and in-store bank-
ing centers, Web banking, telephone banking and ATMs.
Skilled and knowledgeable teams work together every day
to deliver consistently excellent service quality, which results
in deep and long-lasting customer relationships.

2006 Achievements
• Opened 25 new banking centers, 24 of which are in the
high-growth markets of Texas, California, Arizona and
Florida

• Relocated seven banking centers, improving their visibility

and accessibility for all customer segments

• Completed refurbishments to 19 banking centers – 16 in

Michigan, two in Texas and one in California

• Increased average small business loans seven percent to

$3.8 billion compared to 2005

• Completed a comprehensive upgrade of all marketing and

merchandising displays in banking centers nationwide

• Launched “We Love Entrepreneurs” campaign
• Simpliﬁed and enhanced checking account offerings,
including Platinum CircleSM, a package of services that
allows customers to combine business and individual
account balances to meet balance requirements

• Introduced the Comerica-Northwest Airlines WorldPerks

Check Card

• Added six new small-business loan products
• Launched a small-business suite of Cash Management

products

• Introduced Comerica credit cards for small businesses
and consumers. Card features include reward options
and overdraft protection for both personal and business
checking accounts

• Full suite of technologically advanced treasury and global

• Began piloting voice-guidance ATMs

for the visually

trade products and services

impaired

• Experience, knowledge and insight to successfully main-
tain lending relationships through all phases of the eco-
nomic cycle

• Specialty businesses focus including Energy, Entertain-
ment, Title & Escrow, and Technology and Life Sciences

• North American commercial banking platform

Strategies
• Leverage ongoing technology investments in core plat-
forms to deliver customer-centric products and services
• Continue aggressive investment in Treasury Management
products and services by introducing 26 new or enhanced

• Installed TRiO, a relationship-focused front line sales man-

agement system

Competitive Advantages
• Rank #9 among SBA lenders nationwide
• Among the top 20 banking companies in small business

loans

• The top-performing bank and the sixth-most desired
ﬁnancial services company, according to the Financial
Services Demand 2006 study

• Loyal and highly satisﬁed customers – evidence that

Comerica’s relationship strategy works

• Telephone banking center achievement of a top-ﬁve
rating among mystery shoppers of the largest ﬁnancial
institutions

• Skill set and experience of employees
• Improved and highly competitive product set
• Relationship approach to customer service and sales,
which matches the skills and experience of employees
and improves the loyalty of the customer base

Strategies
• Expand and improve customer access points including
the acceleration of the banking center expansion pro-
gram and the continued optimization of the Michigan
banking center network

• Energize sales with improved accountability, sales tools, in-
centives and processes, focused on exceeding customer
needs

• Implement national platforms that will improve efﬁciency,

reduce risk and deliver consistent results

• Leverage Michigan platform and capacity to support the
front line in delivery of the best service and sales experi-
ence for customers

• Partner with Business Bank and Wealth & Institutional Man-

agement on cross-sell opportunities

WEALTH & INSTITUTIONAL
MANAGEMENT

Overview
Comerica’s Wealth & Institutional Management segment
serves the needs of afﬂuent clients, foundations and corpo-
rations, and includes Private Banking, Comerica Securities,
Comerica Insurance, Personal Trust, Strategic Alliances, Insti-
tutional Trust, Retirement Services, Comerica Asset Manage-
ment, World Asset Management and Wilson Kemp.

2006 Achievements
• Completed the sale of Munder Capital Management,
enabling Comerica to continue to drive growth in its
investment management businesses through an open
architecture platform. This makes available a wide
array of
individual and
institutional investors, including Munder’s products

investment alternatives

for

• Enhanced the delivery of Advisory Services by Comerica
Securities, through a new client segmentation method
that provided more effective client service and greater
efﬁciency

• Successfully merged the back-ofﬁce operations and the
compliance departments of Comerica Securities and
Comerica Insurance to create improved efﬁciencies

• Introduced Executive Asset Management Suite, a
product package specially designed for owners and
ofﬁcers of companies that are Comerica business clients
• Broadened the distribution of Comerica Insurance through
the hiring of a new national sales manager who has more
than 20 years experience. Also added insurance specialists
in the Florida and Western markets

• Opened new ofﬁces in the Florida market in Wellington,
Riviera Beach and Stuart. Renovated ofﬁces in the Western
market

Competitive Advantages
• A strong middle market corporate client base, which

knows Comerica as a trusted ﬁnancial institution

• Superior relationship management skills. Many families
have worked with Wealth & Institutional Management for
up to seven generations

• Tenured and experienced staff
• Focus of Wealth & Institutional relationship managers on

referrals and cross-sales

• Investment products, resources and performance
• Presence in national growth markets in California, Texas,

Arizona and Florida

Strategies
• Develop and expand core services, including the 2007
introduction of a best-in-class non-proprietary investment
platform

• Hire, develop and retain exceptional employees through a

rewarding culture and competitive incentive plans

• Generate greater volume of leads through internal refer-
ral sources, and improve cross-selling and cross-referring
capabilities

• Enhance workload efﬁciencies to enable relationship
managers to spend more time selling and servicing
high-net-worth clients

• Leverage Michigan staff expertise and capacity to support

expansion in the growth markets

• Create additional product distribution with private bank-
ers and securities-licensed professionals in more banking
centers

• Partner with Business Bank and Retail Bank on cross-sell

opportunities

Average Deposits

The Retail Bank 45%

Wealth & Institutional
Management 7%

The Business Bank 48%

Average Loans

The Business Bank 80%

The Retail
Bank 13%

Wealth & Institutional
Management 7%

Total Revenue
The Retail
Bank 30%

The Business Bank 56%

Wealth & Institutional
Management 14%

Data is for 2006 and excludes Finance/Other

COMERICA INCORPORATED
Letter to Shareholders

Ralph W. Babb Jr.
Chairman and Chief Executive Oﬃcer

omerica’s solid ﬁnancial performance in 2006 underscores many positive core
operating trends. Loan growth in our fastest-growing markets continued at
a double-digit pace throughout the year, and credit quality remained solid.

We continued to return excess capital to shareholders through our share repurchase
and dividend programs. We also increased our annual dividend for the 38th consecutive
year.

Our strategy for success, ﬁrst outlined three years ago, is focused on six key drivers, or pillars:
growth, balance, relationships, risk management, accountability and diversity. I would like
to focus on the ﬁrst two – growth and balance – as these are areas of increasing emphasis
at Comerica. I also will touch upon relationships – the key to our company’s strength and
success. You can learn more about these and the other pillars of our strategy in the section
immediately following this letter.

Growth
We have an established retail distribution system in Michigan and continue to enjoy a leader-
ship position in the state as the business bank of choice among companies of all sizes. Our brand
recognition in the market continues to be very high, and was greatly enhanced in 2006 when sev-
eral post-season baseball games were played at Comerica Park, home of the American League
Champion Detroit Tigers. Because of our relationships and strong local knowledge, we believe we
can continue to generate good business in Michigan, even in the face of a slow state economy.

We are exporting our relationship banking expertise, nurtured for more than 150 years in Michigan,
to this country’s most attractive and fastest-growing markets: California, Texas, Arizona and Florida.
This is helping us to diversify our earnings mix, so we are far less dependent on any one market or
business segment. Our plan is to continue to grow our presence in these high-growth markets.

Today, Comerica operates in seven of the eleven largest cities in the United States – Los Angeles,
Houston, Phoenix, San Diego, Dallas, San Jose and Detroit.

The U.S. Census Bureau projects that three states – California, Texas and Florida – should account
for nearly one-half of total U.S. population growth between 2000 and 2030. Each of the three
states is expected to gain more than 12 million people between 2000 and 2030. Arizona, in terms
of population, is expected to rise from 20th place in 2000 to 10th place in 2030.

Such projections help fuel our belief that the best opportunities for future growth of Comerica lie
in these fastest-growing markets.

Opening new banking centers in these fastest-growing markets is an important part of our growth
strategy. Unlike other banks, our intention is not to blanket every market with branches. Rather, we
are much more selective. We are opening banking centers in key markets where we can grow
business banking, small business, wealth management and retail all at once.

Since our initial three-year banking center expansion program began in late 2004, we’ve opened
60 new banking centers, up from our original target of 50. In 2006, we opened 25 new banking
centers. We also refurbished 19 banking centers and relocated seven others to more visible and
convenient locations.

Among the new banking centers opened since 2004, we’re seeing a nicely balanced distribution
of loans and deposits from each of our business segments. This is important as we look for sites that
provide a balance of middle market, small business and afﬂuent households. By engaging all of
our lines of business, we greatly improve the rate of success for the new banking centers. We have
obtained almost $800 million in deposits from our new banking centers since beginning the expan-
sion program in late 2004.

Our goal is to have our new banking centers become proﬁtable within 18 months. Our expan-
sion program is meeting that target. As we expand our banking centers, we closely manage our
human capital and expenses.

We are currently planning to open about 30 banking centers in 2007.

Balance
In addition to growth, our new banking centers are providing us with geographic balance. By
2010, we expect more than half of our banking centers to be located in growth markets outside
of Michigan, up from 38 percent today. As we build momentum, we believe we can increase the
rate of expansion.

Our national platform has been built on our ability to export relationship banking to new
markets. Our size allows us to provide customers with a broad range of services while
retaining the look, feel and ﬂexibility of a smaller community-banking organization. We
are steadily making progress toward our goal of achieving more geographic balance,
with the Texas, Western and Florida markets generating 50 percent of average total loans
compared to 46 percent a year ago.

To achieve balance, we are leveraging our strength as a business bank by expanding our
retail, and wealth and institutional management businesses. You can learn more about
our three strategic lines of business in the “At a Glance” section that precedes this letter.

Our strength as a business bank of choice for owner-managed and other companies is
well known. We are among the top commercial lending institutions in the country. We
provide our business customers with a level of service and experience they can’t always
ﬁnd elsewhere. We understand their business models and our commercial lenders use
that knowledge to tailor our products and services to ﬁt their needs.

The retail bank is a key part of our deposit-gathering strategy, and accounts for 45 per-
cent of our 2006 average deposits, excluding the deposits in our Finance/Other division.
Re-invigorating the retail bank is key to maintaining strong proﬁtability and growth.

Our wealth and institutional management business has been producing increasingly bet-
ter results for us. We re-engineered that business, and in doing so re-energized it and
made it more efﬁcient. Leveraging our existing customer base – both in the retail and the
business bank – provides tremendous cross-sell and growth potential.

Regarding the sale of Munder Capital Management: We announced the sale in August
and completed it by year-end. We realized an initial after-tax gain of $108 million. The
transaction was the right move for our clients and shareholders. We now have a highly
effective open architecture wealth management platform, which makes available to
clients a wide array of investment alternatives for individual and institutional investors,
including Munder’s products.

Return on Average Common
Shareholders’ Equity

Cash Dividends Declared Per
Common Share

17.24%

16.90%

15.03%

13.12%

12.31%

$2.36

$2.20

$2.08

$2.00

$1.92

2002 2003 2004 2005 2006
Based on net income

2002 2003 2004 2005 2006

Relationships
The relationships we form with our customers provide us with a distinct competitive advantage
in the ﬁnancial services marketplace. Our relationship managers are known for their ingenu-
ity, ﬂexibility, responsiveness, and attention to detail. They are seasoned professionals whose
experience level is among the ﬁnancial services industry’s highest. By staying close to our custom-
ers, we are able to provide them with the solutions, products and quality services that help them
be successful.

We have included some examples of our outstanding customer relationships in the pages that
follow this letter.

Comerica’s relationship model has ﬂourished in several niche markets. These include ﬁnancial
services, municipalities, heavy equipment dealers, title and escrow companies, and private
equity-sponsored companies. We are expanding these specialty areas to all of our markets.

We do an excellent job training and rewarding our relationship managers to cross-sell the bank’s
products and services. Based on a recent customer survey of our middle-market customers in
three of our major markets, overall customer satisfaction is high. This is evident in the fact that on
average, Comerica captures 92 percent of its customers’ total treasury management business.
That’s very high, given that customers are willing to give a maximum of 97 percent of their trea-
sury management business to a single provider. In fact, Comerica received very strong scores for
ease of doing business and for the depth of our products and services.

Wealth and institutional management provides another example of our ability to increase the
depth of customer relationships from cross-selling other bank products and services. Our wealth
and institutional management strategy is consistent with Comerica’s core strength: It starts with a
relationship-based sales model. To that, we add strong investment performance and customized
and ﬂexible solutions for our customers.

Comerica’s focus on relationships also extends to the communities where we do business. Through
contributions, employee volunteerism and partnerships, we are helping to make a difference in
the communities we serve. In 2006, we provided nearly $16 million to not-for-proﬁt organizations
nationwide, including nearly $9 million from the Comerica Charitable Foundation. We also raised
$2.4 million in employee pledges for United Way and the Black United Fund.

In summary, our strategy for success is working and delivering solid results, thanks in large part to
our employees, who are committed to our vision of helping people be successful. Our businesses
continue to grow. We’re beginning to move the needle on the balance of our earnings mix, and
we expect those results to accelerate. We believe a balanced growth strategy will produce
more stable and consistent earnings over time. In this competitive environment, relationships
matter the most. We expect to continue to see the beneﬁts of this approach as we apply our
relationship-based model to our growth products and markets.

We believe the result will be a bank with an improving growth rate; a more stable, more diver-
siﬁed mix of revenues; and excellent credit management. Combining that with an attractive
dividend payout and capital management program provides a formula for solid returns to our
shareholders.

Ralph W. Babb Jr.
Chairman and Chief Executive Ofﬁcer

DON SEBASTIANI & SONS

his family-owned ﬁrm specializes in upscale, but mod-
erately priced varietal wines. Principals Don Sebastiani
and sons, Donny and August, are third- and fourth-
generation California vintners and wine merchants. The
company, with headquarters in the Sonoma Valley and a winery in
the Napa Valley, reached annual case volume of 1.5 million in 2005, making it one of
the fastest-growing wineries in California. That same year, Wine Enthusiast magazine
named Don Sebastiani & Sons the American Winery of the Year.

“It just reafﬁrms that our innovativeness in trying to create exciting new wine brands
has struck a chord with the consumer,” says Richard Conley, chief operating ofﬁcer.
“Comerica and its San Francisco Regional Ofﬁce has been a great partner in helping
us achieve growth by being ﬂexible and responsive.”

Don Sebastiani & Sons depends on Comerica to provide it with a revolving line of
credit to ﬁnance inventory and accounts receivable, as well as an equipment loan
to ﬁnance the purchase of steel tanks and bottling equipment.

THE MASTRO COMPANIES

ith headquarters in Scottsdale, Ariz., this highly successful restaurant
holding/management company is a customer of Comerica’s Phoenix
Regional Ofﬁce. The Mastro Companies has four restaurant brands:
Mastro’s Steakhouse, an upscale steakhouse with locations in
Scottsdale, Costa Mesa, Beverly Hills and Thousand Oaks; Mastro’s Ocean Club,
an upscale seafood restaurant with locations in Scottsdale and Newport Beach;
Maloney’s, a college-town bar & grill with locations in San Diego and throughout
the Southwest; and Cocomo Joe’s, a Caribbean-themed restaurant in Phoenix.
Comerica has not only provided ﬁnancing for ﬁve of Mastro’s 13 locations, but also
assisted with real estate transactions and a working capital line of credit.

“Comerica has been terriﬁc,” says Jeff Mastro, president. “They helped us tremen–
dously with our growth spurt in 2002, and stepped up again this year to help us out
in our latest round of growth.”

COMERICA BANK – WESTERN MARKET
The Western Market of Comerica Bank includes 75 banking centers in two states,
California and Arizona: 70 in the key California markets of San Francisco and the
East Bay, San Jose, Los Angeles, Orange County, San Diego, Fresno, Sacramento,
and Santa Cruz /Monterey; also, ﬁve banking centers in greater Phoenix, Ariz.

GROWTH

Comerica is expanding in growing markets in Cali-
fornia, Texas, Arizona and Florida, while maintaining
its leadership position in Michigan. Opening new
banking centers is an important part of Comerica’s
growth plans. The banking center expansion pro-
gram is not just a retail strategy; it is a strategy that
focuses on serving all of Comerica’s lines of business.
Comerica seeks out sites that provide a balance of
small businesses, middle market companies, afﬂuent
households, and where there are wealth manage-
ment opportunities.

392 U.S. Banking Centers
TX 17.3%

AZ 1.3%

FL 2.3%

CA 17.9%

MI 61.2%

2006

BALANCE

To achieve consistent growth through all phases of
a business cycle, Comerica is diversifying its earn-
ings mix, particularly by geographic market. The
markets outside of the Midwest accounted for 50
percent of average total loans in 2006, compared
to 46 percent in 2005.

Geographic Loan Growth (By Market Segment)

Total: $47.7 Billion

Texas 13%

Florida
4%

512 U.S. Banking Centers
TX 20%

Midwest & Other 50%

Western 33%

AZ 5%

FL 4%

2006

MI 46%

CA 25%

2010 Projected

Total: $43.8 Billion

Texas 12%

Florida
3%

Midwest & Other 54%

Western 31%

2005

Data is for 2005 and 2006 and excludes Finance/Other

GULF WINDS
INTERNATIONAL

ou don’t need to tell Steve Stewart about the beneﬁts
of an increasingly global economy. Every customer
he has either imports or exports something from the
Port of Houston.

Stewart is president and co-owner of Gulf Winds International,
a third-party logistics provider to the shipping industry. Under
that logistics umbrella, the company specializes in warehous-
ing and related services, as well as distribution services for the
international shipping community.

Gulf Winds, celebrating its 10th anniversary this year, operates
six warehouse facilities in Houston, which total about 1.5 million
square feet of storage and handling space.

“For the last ﬁve or six years, our growth rate has been 25-30
percent a year. No doubt some of this growth is a result of the
ever-increasing trafﬁc seen at The Port of Houston. However,
our ability to attract key employees, including reliable and
safe drivers, continues to give us the competitive advantage
to grow our market share,” explains Stewart.

“When we started out as a small business, I wore out my knee
pads trying to get a bank to give us a small business loan.
Eventually we found a bank that gave us a small line of credit,
but we were growing too fast for them. They couldn’t com-
prehend our business model. They weren’t familiar with the
transportation industry. Comerica, however, has a middle
market group and we ﬁt within that framework quite nicely.
They came in, took a look at our books, interviewed us, and
determined that we were exactly the kind of company that
they wanted to work with. So we began our relationship with
Comerica in February of 2003. Once we had a reliable and
aggressive banking partner, things really started to happen
for us. Frankly, our growth
wouldn’t have happened with-
out Comerica, who gave us the
ﬁnancing and ﬁnancial strength
to do what we needed to do.”

COMERICA BANK – TEXAS MARKET
The Texas Market of Comerica Bank includes
68 banking centers in the key Texas markets of
Dallas, Houston and Austin.

COMERICA
RECOGNIZED FOR
DIVERSITY

Comerica continued to demonstrate its com-
mitment to diversity in a number of ways in 2006,
and has received considerable recognition for its
efforts.

segmentation groups
Comerica has market
across the organization. Each group
includes
Comerica colleagues who are responsible for
developing strategies and tactics for reaching out
to African Americans, Hispanics, women, Arab
and Chaldean Americans, Asian Indians, and
Asian Paciﬁc Islanders. The market segmentation
groups are ably assisted by the Business Affairs
Department.

Business Affairs was strengthened in 2006 with sever-
al key appointments to Senior Vice President Linda
Forte’s team. Janice Tessier was named National
Manager of Diversity Initiatives and provides assis-
tance to the market segmentation groups, to help
them achieve their goals and make their teams
successful. Amal Berry-Brown was named Arab
and Chaldean American Business Affairs Manager.
Monica Martinez was named Hispanic Business
Affairs Manager. The three appointees are work-
ing with colleagues across all markets in growing
and strengthening relationships with segmentation
group customers and prospects.

Comerica also demonstrated its commitment to
diversity through sponsorships and volunteerism
activities. For example, Comerica was one of the
leading corporate fundraisers for the National
Conference for Community and Justice, or NCCJ
(recently renamed the Michigan Roundtable for
Diversity and Inclusion) “Walk As One” in Detroit.
More than 400 Comerica colleagues participated
in the walk, raising needed funds for a program
designed to help young adults recognize the need
for tolerance.

Comerica’s Service Company introduced a Mas-
ters of Diversity Awareness (MDA) Program in 2006,
designed to develop understanding and apprecia-
tion of diversity throughout the division. The creative

pilot program provides colleagues with learning
opportunities covering various aspects of diversity,
and provide tools and information to assist them in
managing diversity in the workplace.

During National Diversity Month, a number of pro-
grams were successfully completed to celebrate
diversity at Comerica, including a panel discussion
on Asian culture with Comerica colleagues in the
Western Market.

As a result of its strong commitment to diversity,
Comerica received a number of honors during
2006, including the following:

• Comerica has been ranked #12 (up from #34 in
2005) on the DiversityInc list of the “Top 50 Compa-
nies in the United States” based on commitment
to diversity. In addition, Comerica ranked #4 for
its commitment to supplier diversity and #6 based
on the number of women in executive positions.

• BLACK ENTERPRISE magazine named Comerica
to its list of the “40 Best Companies for Diversity.”

• Asian Enterprise Magazine named Comerica as
one of the “Top U.S. Companies for Asian-Ameri-
cans,” based upon its commitment to the small-
business community, as well as its contributions to
the Asian Paciﬁc American market.

• Comerica was named by the Michigan Minority
Business Development Council as the “2006 Cor-
poration of the Year – Finance & Insurance Servic-
es sector,” which is the 10th time during the past
11 years that Comerica has received this honor
for its commitment to using minority-owned sup-
pliers, and helping them grow and prosper.

• Chairman Ralph Babb was honored as a
“Humanitarian of the Year” at the Michigan
Roundtable for Diversity and Inclusion’s annual
Humanitarian Tribute Luncheon in Detroit.

• Comerica also was named as one of “Metropoli-
tan Detroit’s 101 Best and Brightest Companies to
Work For” by the Michigan Business and Profes-
sional Association and the National Association
for Business Resources. Comerica received this
honor due to its commitment to work-life bal-
ance, robust diversity program and full menu of
beneﬁts for full and part-time employees, among
other factors.

In addition to its continued work with the market
segmentation groups, Business Affairs in 2007 will
ensure that all employ-
ees have ready access
to information that will
assist them in success-
fully achieving their busi-
ness goals as they reach
out to diverse customers
and prospects.

THE SAGEMONT SCHOOL

he Sagemont School in Weston, Florida has demonstrated
tremendous growth over the past decade. Sagemont is a
fully accredited private school that offers a comprehen-
sive education for children from pre-kindergarten through
12th grade. The school has become a leader in the nation when it
comes to integrating technology into the K-12 curriculum, and has
built a wireless laptop community for its middle- and upper-school
students.

With some 770 students, the school’s mission is to stimulate critical
thinking through a rigorous college preparatory program and indi-
vidualized instruction.

“We strive to build a community of learners, one student at a time,”
says Sagemont Headmaster Brent Goldman. “We believe that aca-
demics are only one part of the package. That’s why we offer a
wide array of extracurricular activities for students of all ages and
interests. Our goal is to help foster well-educated, well-rounded
individuals who are destined for success in college and in life.”

Comerica has been part of the Sagemont team since 2005, when
the bank created a reﬁnancing package to help the school man-
age a healthier cash ﬂow. The relationship continues with a newly
created “Friends and Family of Sagemont School” banking pack-
age, to help parents prepare for college tuition and other costs. In
addition, Comerica is ﬁnancing the construction of a new athletic
facility on the campus that will enable the school to offer summer
programming to the entire community.

Comerica recently secured the naming rights to the school gymna-
sium to help defray the costs of the athletic program. “We’re very
proud of The Comerica Bank Dome,” says Goldman. “The partner-
ship between Sagemont and Comerica enables us to enhance our
sports and other programs in very meaningful ways.”

COMERICA BANK – FLORIDA MARKET
The Florida Market of Comerica Bank includes nine banking centers
in Boca Raton, Ft. Lauderdale, Palm Beach Gardens, Naples,
Riviera Beach, Sarasota, Stuart, Wellington and Weston.

BELLE TIRE
DISTRIBUTORS

f you live and work in Michigan, then you
should be very familiar with this successful
family retail business. Belle Tire has built a solid
reputation for quality and service ever since it

was established in 1922.

The company’s
relationship with
longstanding
Comerica has been a key to the ﬁrm’s consistent
growth; Belle Tire has been a Comerica customer
for 57 years.

In 1994, Comerica Bank assisted Belle Tire with the
buyout of Tire Man, its largest competitor. The strat-
egy nearly doubled the number of Belle Tire’s retail
stores.

“When we merged the two companies, that’s when
things really started to pick up for us, because our
larger size enabled us to increase our advertising
and promotions,” says Don Barnes, Belle Tire presi-
dent. “We also gained a tremendous amount of syn-
ergies by eliminating duplication, and that, in turn,
allowed us to be more proﬁtable and grow.”

Since then, Comerica has helped Belle Tire with oth-
er acquisitions. The company now has 81 locations
with annual sales of more than $234 million. Current-
ly, Comerica is ﬁnancing Belle Tire’s new $8.0 million
corporate headquarters in Allen Park, Mich. Belle
Tire purchased the former Frito Lay building near its
existing warehouse. Renovation of the facility was
completed in the fourth quarter of 2006.

“Comerica has been a wonderful part-
ner,” Barnes says. “Anytime we needed
to take some type of new action to grow,
Comerica was always there to help us.
It’s a great relationship.”

COMERICA BANK – MICHIGAN MARKET
The Michigan Market of Comerica Bank includes
240 banking centers in metropolitan Detroit, Ann
Arbor, Battle Creek, Grand Rapids, Jackson, Kal-
amazoo, Lansing, Midland and Muskegon.

RISK MANAGEMENT

Comerica has invested signiﬁcant resources into
making its risk management systems and processes
best in class. Enhanced risk management tools en-
able Comerica to mitigate variability in credit qual-
ity. Improvements in credit quality have been a key
contributor of Comerica’s strong ﬁnancial perfor-
mance. Comerica’s solid credit quality metrics are
evident in the charts below.

Nonperforming Assets
(in Millions)

$579

$538

$339

$232

$162

2002 2003 2004 2005 2006

Net Loan Charge-offs
(in Millions)

$481

$365

$194

$110

$60

2002 2003 2004 2005 2006

ACCOUNTABILITY

Execution is one of the most important compo-
nents of Comerica’s business model and is key to
accountability at the organization.

For the Business Bank, executing the plan means
continuing to introduce new products and services,
increasing cross-sales, and exporting the expertise
of several businesses into other parts of Comerica’s
footprint.

For the Retail Bank, executing the plan means
improv-
applying technology, expanding and
ing access points, developing an energized sale
culture, and creating national platforms that will
help Comerica do business more productively and
efﬁciently.

For Wealth & Institutional Management, executing
the plan means aggressively investing in training,
new people and new technologies to enhance
Comerica’s competitive edge; delivering strong
investment performance; and offering customized,
ﬂexible solutions to clients.

OTHER COMERICA LOCATIONS

U.S.

City
Barrington, IL
Bellevue, WA
Boston

Chicago

Cincinnati
Cleveland
Denver

Las Vegas
Memphis
Minneapolis
New York
Princeton, NJ
Reston, VA
Rocky Mount, NC
Seattle, WA
Wilmington, DE

Business
SBA Lending
Technology & Life Sciences
Trust Services, Technology &
Life Sciences
Trust Services, International
Finance, National Dealer
Services, Specialized Industries
Middle Market Banking
Middle Market Banking
National Dealer Services,
Trust Services
U.S. Banking
Trust Services
Trust Services
Trust Services
Trust Services
Technology & Life Sciences
Trust Services
Trust Services
Trust Services

NON-U.S.
In Canada
Toronto, Windsor
Information: Toronto 416.367.3113
Windsor 519.250.0460

In Mexico
Monterrey
Information: [52] 818.368.0316
In China
Shanghai
Information: 86.21.5882.6980

OTHER COMERICA UNITS

Comerica Bank & Trust, National Association
Provides a national platform for the delivery of
trust, investment management and other bank-
ing services.

Comerica Insurance Services, Inc.
Offers life, disability, long-term care, group
beneﬁts, and property and casualty insurance to
businesses and individuals.

Comerica Leasing Corporation
Provides equipment leasing and ﬁnancing ser-
vices for businesses throughout the United States.

Comerica Securities, Inc.
A full-service broker-dealer that offers stocks,
bonds, corporate and public ﬁnance, mutual
funds and annuities, along with a full
suite of fee-based investment management
services.

Comerica West Incorporated
Originates mid-sized loans to business customers
with a speciﬁc emphasis on the Western United
States.

Wilson, Kemp & Associates, Inc.
Provides investment advisory services to private
investors, corporations, municipalities and chari-
table institutions throughout the United States.

World Asset Management, Inc.
Manages index portfolios for clients, including
municipalities, unions, corporations, endowments
and foundations.

W.Y. Campbell & Company
Provides investment banking and corporate
ﬁnance services to Fortune 500 companies and
middle-market ﬁrms.

COMERICA OPENS SHANGHAI OFFICE
Comerica’s new representative oﬃce in Shanghai provides networking services for U.S. customers seeking to expand or
explore business opportunities in China.
“China is the fastest-growing importer and exporter for the U.S., and Chinese-owned businesses represent an increasingly
signiﬁcant part of our Western Market,” said Tom Ogden, executive vice president for Global Corporate Banking. “The
Shanghai location is especially advantageous to Comerica because it is a center of manufacturing activity for many
U.S.-aﬃliated companies. By having an oﬃce in this key business center, we can provide our customers with introductions
to professionals and business partners, cut through red tape and provide education about local business practices.”
“Our representative in Shanghai, Helen Huang, is expanding our current networking resources in China with banks, law
ﬁrms, accountants and others operating there,” said J. Michael Fulton, president and chief executive oﬃcer of Comerica
Bank’s Western Market. “In doing so, she is demonstrating to U.S. businesses that Comerica is one of the few commercial
banks that can add value to their present or future needs in China.”
Huang, a U.S. citizen who is a native of Shanghai, speaks and writes Mandarin ﬂuently, speaks the Shanghai dialect,
and understands Cantonese and several regional dialects.

BOARD OF DIRECTORS
COMERICA INCORPORATED

Alfred A. Piergallini
Chairman, President and
Chief Executive Ofﬁcer
Wisconsin Cheese Group, Inc.
(manufacturer and marketer
of ethnic and specialty
cheeses); Consultant, Desert
Trail Consulting (marketing
consulting organization)

Robert S. Taubman
Chairman, President and
Chief Executive Ofﬁcer
Taubman Centers, Inc.
(shopping center management
company engaged in leasing,
management and construction
supervision)

Reginald M. Turner Jr.
Member
Clark Hill PLC
(full-service law ﬁrm)

c c
William P. Vititoe
Retired Chairman, President
and Chief Executive Ofﬁcer
Washington Energy Company
(diversiﬁed energy company,
now Puget Sound Energy, Inc.)

Kenneth L. Way
Retired Chairman
Lear Corporation
(manufacturer of automotive
components)

Ralph W. Babb Jr.
Chairman and
Chief Executive Ofﬁcer
Comerica Incorporated and
Comerica Bank

c
Lillian Bauder, Ph.D.
Retired Vice President
Masco Corporation
(manufacturer of diversiﬁed
household and consumer
products and services)

Joseph J. Buttigieg III
Vice Chairman
Comerica Incorporated and
Comerica Bank

James F. Cordes
Retired Executive Vice President
The Coastal Corporation
(diversiﬁed energy company)

Roger A. Cregg
Executive Vice President and
Chief Financial Ofﬁcer
Pulte Homes, Inc.
(national home builder)

Peter D. Cummings
Chairman
Ram Realty Services
(private real estate management
and development company)

T. Kevin DeNicola
Senior Vice President and
Chief Financial Ofﬁcer
Lyondell Chemical Company
(global manufacturer of basic
chemicals)

Anthony F. Earley Jr.
Chairman and
Chief Executive Ofﬁcer
DTE Energy Company
(diversiﬁed energy company)

BOARD COMMITTEES

Audit
Compensation
Corporate Governance & Nominating
Qualiﬁed Legal Compliance
Enterprise Risk

c Committee Chairperson

MANAGEMENT
POLICY COMMITTEE
Ralph W. Babb Jr.
Chairman and
Chief Executive Ofﬁcer

Joseph J. Buttigieg III
Vice Chairman
The Business Bank

Elizabeth S. Acton
Executive Vice President
and Chief Financial Ofﬁcer

Connie Beck
Executive Vice President
The Retail Bank

John R. Beran
Executive Vice President and
Chief Information Ofﬁcer

Jon W. Bilstrom
Executive Vice President
Governance, Regulatory
Relations & Legal Affairs

David E. Duprey
Executive Vice President
General Auditor

J. Michael Fulton
President and
Chief Executive Ofﬁcer
Comerica Bank – Western Market

Dale E. Greene
Executive Vice President and
Chief Credit Ofﬁcer

Charles L. Gummer
President and
Chief Executive Ofﬁcer
Comerica Bank – Texas Market

Michael H. Michalak
Senior Vice President
Corporate Planning,
Development & Risk Management

Dennis J. Mooradian
Executive Vice President
Wealth & Institutional Management

Jacquelyn H. Wolf
Executive Vice President
Chief Human Resources Ofﬁcer
and Corporate Communications

SHAREHOLDER INFORMATION

STOCK
Comerica’s stock trades on the New York Stock Exchange
(NYSE) under the symbol CMA.

SHAREHOLDER ASSISTANCE
Inquiries related to shareholder records, change of name, ad-
dress or ownership of stock, and lost or stolen stock certiﬁcates
should be directed to the transfer agent and registrar:

WRITTEN REQUESTS:
Wells Fargo Shareowner Services
P.O. Box 64854
St. Paul, MN 55164-0854
(877) 536-3551
stocktransfer@wellsfargo.com

CERTIFIED/OVERNIGHT MAIL:
Wells Fargo Shareowner Services
161 North Concord Exchange
South St. Paul, MN 55075-1139
(877) 536-3551
shareowneronline.com

ELIMINATION OF DUPLICATE MATERIALS
If you receive duplicate mailings at one address, you may
have multiple shareholder accounts. You can consolidate your
multiple accounts into a single, more convenient account by
contacting the transfer agent shown above. In addition, if more
than one member of your household is receiving shareholder
materials, you can eliminate the duplicate mailings by contact-
ing the transfer agent.

DIVIDEND REINVESTMENT PLAN
Comerica offers a dividend reinvestment plan, which permits
participating shareholders of record to reinvest dividends in
Comerica common stock without paying brokerage commis-
sions or service charges. Participating shareholders also may
invest up to $10,000 in additional funds each month for the pur-
chase of additional shares. A brochure describing the plan in
detail and an authorization form can be requested from the
transfer agent shown above.

DIVIDEND DIRECT DEPOSIT
Common shareholders of Comerica may have their dividends
deposited into their savings or checking account at any bank
that is a member of the National Automated Clearing House
(ACH) system. Information describing this service and an autho-
rization form can be requested from the transfer agent shown
above.

DIVIDEND PAYMENTS
Subject to approval of the board of directors, dividends cus-
tomarily are paid on Comerica’s common stock on or about
January 1, April 1, July 1 and October 1.

FORM 10-K
A copy of the Corporation’s Annual Report on Form 10-K, as
ﬁled with the Securities and Exchange Commission, may be ob-
tained without charge upon written request to the Secretary of
the Corporation at the address listed on the inside back cover.

STOCK PRICES, DIVIDENDS AND YIELDS

Quarter

High

Low

Dividends Dividend
Per Share

Yield*

2006
Fourth
Third
Second
First

2005
Fourth
Third
Second
First

$59.72
58.95
60.10
58.62

$60.25
63.38
59.29
61.40

$55.82
51.45
50.12
54.23

$53.60
56.80
53.17
53.70

$0.59
0.59
0.59
0.59

$0.55
0.55
0.55
0.55

4.1%
4.3
4.3
4.2

3.9%
3.7
3.9
3.8

* Dividend yield is calculated by annualizing the quarterly dividend per share and dividing

by an average of the high and low price in the quarter.

As of January 31, 2007 there were 14,133 holders of record of
the Corporation’s common stock.

OFFICER CERTIFICATIONS
On June 6, 2006, Comerica’s Chief Executive Ofﬁcer
submitted his annual certiﬁcation to the New York Stock Ex-
change stating that he was not aware of any violation by
the Corporation of the Exchange’s corporate governance
listing standards. Comerica ﬁled the certiﬁcations by its Chief
Executive Ofﬁcer and Chief Financial Ofﬁcer required by
Section 302 of the Sarbanes-Oxley Act of 2002 as exhibits
to its Annual Report on Form 10-K for the ﬁscal year ended
December 31, 2006.

Debt Ratings – Senior Unsecured Obligations
Comerica
Bank
A+
A1
A+
A (high)

Standard and Poor’s
Moody’s Investors Service
Fitch Ratings
Dominion Bond Rating Service

Comerica
Incorporated
A
A2
A+
A

INVESTOR RELATIONS ON THE INTERNET
Go to www.comerica.com to ﬁnd the latest investor rela-
tions information about Comerica, including stock quotes,
news releases and ﬁnancial data.

COMMUNITY REINVESTMENT ACT (CRA)
PERFORMANCE
Comerica is committed to meeting the credit needs of
the communities it serves. Comerica’s overall CRA rating is
“Outstanding.”

EQUAL EMPLOYMENT OPPORTUNITY
Comerica is committed to its afﬁrmative action program
and practices, which ensure uniform treatment of employ-
ees without regard to race, creed, ethnicity, color, age,
national origin, religion, handicap, marital status, sexual
orientation, veteran status, weight, height or sex.

CORPORATE ETHICS
The Corporate Governance section of Comerica’s website
at www.comerica.com includes the following codes of eth-
ics: Senior Financial Ofﬁcer Code of Ethics, Code of Business
Conduct and Ethics for Employees, and Code of Business
Conduct and Ethics for Members of the Board of Direc-
tors. Comerica will also disclose in that website section any
amendments or waivers to those codes of ethics, within four
business days of such an event.

Financial Highlights

CONTENTS
1
2 At-a-Glance
4
8
14 Other Comerica Locations/Units
15 Board of Directors/Management Policy Committee
16

Shareholder Information

Letter to Shareholders

Strategy for Success

CORE VALUES

• Customer Service

• Diversity

• Ownership

• Teamwork

• Flexibility/Adapting to Change

• Trust/Integrity

• Learning and Personal Growth

Major League Baseball World Series Game 1
October 21, 2006, Comerica Park

VISION

Comerica is in business to help people be successful. We are committed to
delivering the highest quality ﬁnancial services by:

• Providing outstanding value and building enduring customer relationships

• Creating a positive environment for our colleagues,

built on trust, teamwork and respect

• Demonstrating leadership in our communities

• Ensuring a consistent, superior return for our owners

2006 Annual Report
S TRATEGY FO R SUCCESS

Growth

Balance

Relationships

Risk Management

Accountability

Diversity

C
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E
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6

A
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A
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P
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Comerica Incorporated
Comerica Tower at Detroit Center
500 Woodward Avenue, MC 3391
Detroit, Michigan 48226