Comerica Incorporated (CMA) yesterday redeemed the $2.25bn of preferred stock issued to the US Treasury Department under the Troubled Asset Relief Program (TARP). In addition to paying back the TARP Capital Purchase Program, Comerica paid the Treasury $150.9m in dividends earned since the date the stock was issued in November 2008. The repayment came five days after Comerica completed the public issuance of $880m of its common stock. With the repayment, Comerica eliminates the annual $134m impact against the net income to common shareholders related to the preferred stock. The bank reported $59.2bn in assets at the end of 2009. The repayment brings the total amount of repaid TARP funds to $175.2bn, the latest coming from PNC Financial Services Group (PNC) when it repaid $7.6bn of preferred shares. The Treasury estimates that the total repayments and proceeds from sales of its common stock in banks should reach $185bn by the end of 2010. It would reduce the amount of taxpayer exposure to the banks by 75%. In addition to the repayments, the Treasury reported it has received roughly $17bn in revenue through interest, dividends and the sale of warrants at the time PNC made its repayment. “I believe we have weathered the economic cycle well, maintaining strong liquidity, solid capital, tight control of expenses and with credit metrics which compare favorably to our peer group. We believe the TARP repayment provides a sound foundation for our future growth,” said Ralph Babb, CEO of Comerica. Write to Jon Prior.
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