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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-K

Annual Report Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
For the fiscal year ended December 31, 2009
Commission file number 1-10706

COMERICA INCORPORATED
(Exact Name of Registrant as Specified in Its Charter)


Delaware		38-1998421
(State or Other Jurisdiction of Incorporation)		(IRS Employer Identification Number)

Comerica Bank Tower
1717 Main Street, MC 6404
Dallas, Texas 75201
(Address of Principal Executive Offices) (Zip Code)

(214) 462-6831
(Registrant's Telephone Number, Including Area Code)

Securities registered pursuant to Section 12(b) of the Exchange Act:
• Common Stock, $5 par value
• Rights to acquire Series D Preferred Stock, no par value
These securities are registered on the New York Stock Exchange.

Securities registered pursuant to Section 12(g) of the Exchange Act:
• Floating Rate Senior Notes due 2010
• 6.576% Capital Securities of Comerica Capital Trust II due 2037

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ý No o

Indicate by check mark if registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes o No ý

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ý No o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes o No o

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§229.405) is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. ý

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See definition of "accelerated filer," "large accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act.


Large accelerated filer ý		Accelerated filer o		Non-accelerated filer o (Do not check if a smaller reporting company)		Smaller reporting company o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No ý

At June 30, 2009 (the last business day of the registrant's most recently completed second fiscal quarter), the registrant's common stock, $5 par value, held by non-affiliates had an aggregate market value of approximately $3,063,020,536 based on the closing price on the New York Stock Exchange on that date of $21.15 per share and approximately 144,823,666 shares of common stock held by non-affiliates. For purposes of this Form 10-K only, it has been assumed that all common shares Comerica's Trust Department holds for Comerica and Comerica's employee plans, and all common shares the registrant's directors and executive officers hold, are shares held by affiliates.

At February 22, 2010, the registrant had outstanding 151,174,236 shares of its common stock, $5 par value.

Documents Incorporated by Reference:

1.: Parts I and II:
Items 1, 5-8 and 9A—Annual Report to Shareholders for the year ended December 31, 2009.
2.: Part III:
Items 10-14—Proxy Statement for the Annual Meeting of Shareholders to be held April 27, 2010.

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TABLE OF CONTENTS


PART I		1
	Item 1. Business	1
	Item 1A. Risk Factors	11
	Item 1B. Unresolved Staff Comments	19
	Item 2. Properties	19
	Item 3. Legal Proceedings	19
	Item 4. Submission of Matters to a Vote of Security Holders	19
PART II		20
	Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	20
	Item 6. Selected Financial Data	24
	Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations	24
	Item 7A. Quantitative and Qualitative Disclosures About Market Risk	24
	Item 8. Financial Statements and Supplementary Data	25
	Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	25
	Item 9A. Controls and Procedures	25
	Item 9B. Other Information	25
PART III		25
	Item 10. Directors and Executive Officers of the Registrant	25
	Item 11. Executive Compensation	26
	Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	26
	Item 13. Certain Relationships and Related Transactions, and Director Independence	26
	Item 14. Principal Accountant Fees and Services	26
PART IV		30
	Item 15. Exhibits and Financial Statement Schedules	30
SIGNATURES		35
Incorporated Sections of Registrant's 2009 Annual Report to Shareholders
Subsidiaries of the Registrant
Consent of Ernst & Young LLP
Chairman, President and CEO Certification Pursuant to Section 302
Executive Vice President and CFO Certification Pursuant to Section 302
Certification Pursuant to Section 906
Certification Pursuant to 31 C.F.R. § 30.15 (Principal Executive Officer)
Certification Pursuant to 31 C.F.R. § 30.15 (Principal Financial Officer)

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PART I

Item 1. Business.

GENERAL

Comerica Incorporated ("Comerica") is a financial services company, incorporated under the laws of the State of Delaware, and headquartered in Dallas, Texas. As of December 31, 2009, it was among the 25 largest commercial bank holding companies in the United States. Comerica was formed in 1973 to acquire the outstanding common stock of Comerica Bank, which at such time was a Michigan banking corporation and one of Michigan's oldest banks (formerly Comerica Bank-Detroit). On October 31, 2007, Comerica Bank, a Michigan banking corporation, was merged with and into Comerica Bank, a Texas banking association ("Comerica Bank"). As of December 31, 2009, Comerica owned directly or indirectly all the outstanding common stock of 2 active banking and 48 non-banking subsidiaries. At December 31, 2009, Comerica had total assets of approximately $59.2 billion, total deposits of approximately $39.7 billion, total loans (net of unearned income) of approximately $42.2 billion and shareholders' equity of approximately $7.0 billion.

BUSINESS STRATEGY

Comerica has strategically aligned its operations into three major business segments: the Business Bank, the Retail Bank, and Wealth & Institutional Management. In addition to the three major business segments, the Finance Division is also reported as a segment.

The Business Bank is primarily comprised of the following businesses: middle market, commercial real estate, national dealer services, international finance, global corporate, leasing, financial services, and technology and life sciences. This business segment meets the needs of medium-size businesses, multinational corporations and governmental entities by offering various products and services, including commercial loans and lines of credit, deposits, cash management, capital market products, international trade finance, letters of credit, foreign exchange management services and loan syndication services.

The Retail Bank includes small business banking and personal financial services, consisting of consumer lending, consumer deposit gathering and mortgage loan origination. In addition to a full range of financial services provided to small business customers, this business segment offers a variety of consumer products, including deposit accounts, installment loans, credit cards, student loans, home equity lines of credit and residential mortgage loans.

Wealth & Institutional Management offers products and services consisting of fiduciary services, private banking, retirement services, investment management and advisory services, investment banking and discount securities brokerage services. This business segment also offers the sale of annuity products, as well as life, disability and long-term care insurance products.

The Finance segment includes Comerica's securities portfolio and asset and liability management activities. This segment is responsible for managing Comerica's funding, liquidity and capital needs, performing interest sensitivity analysis and executing various strategies to manage Comerica's exposure to liquidity, interest rate risk and foreign exchange risk.

In addition, Comerica has positioned itself to deliver financial services in its four primary geographic markets: Midwest, Western, Texas and Florida.

The Midwest market consists of Michigan, Ohio and Illinois. The Michigan operations represent the significant majority of the Midwest market.

The Western market consists of the states of California, Arizona, Nevada, Colorado and Washington. Currently, California operations represent the significant majority of the Western market.

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The Texas and Florida markets consist of the states of Texas and Florida, respectively.

In addition to the four primary geographic markets, Comerica also considers Other Markets and International as market segments. Other Markets include businesses with a national perspective, Comerica's investment management and trust alliance businesses as well as activities in all other markets in which Comerica has operations, except for the International market. The International market represents the activities of Comerica's international finance division, which provides banking services primarily to foreign-owned, North American-based companies and secondarily to international operations of North American-based companies.

We provide financial information for our segments and information about our non-U.S. revenues and long-lived assets: (1) under the caption, "Strategic Lines of Business" on pages 25 through 29 of Comerica's Annual Report to Shareholders for the year ended December 31, 2009, which pages are hereby incorporated by reference; and (2) in Note 24 of the Notes to Consolidated Financial Statements located on pages 138 through 143 of Comerica's Annual Report to Shareholders for the year ended December 31, 2009, which pages are hereby incorporated by reference.

We provide information about the net interest income and noninterest income we received from our various classes of products and services: (1) under the caption, "Analysis of Net Interest Income—Fully Taxable Equivalent (FTE)" on page 15 of Comerica's Annual Report to Shareholders for the year ended December 31, 2009, which page is hereby incorporated by reference; (2) under the caption "Net Interest Income" on page 17 of Comerica's Annual Report to Shareholders for the year ended December 31, 2009, which page is hereby incorporated by reference; and (3) under the caption "Noninterest Income" on pages 19 through 21 of Comerica's Annual Report to Shareholders for the year ended December 31, 2009, which pages are hereby incorporated by reference.

We provide information on risks attendant to foreign operations: (1) under the caption, "Provision for Credit Losses" on pages 18 and 19 of Comerica's Annual Report to Shareholders for the year ended December 31, 2009, which pages are hereby incorporated by reference; (2) under the caption "Geographic Market Segments" on page 27 through 29 of Comerica's Annual Report to Shareholders for the year ended December 31, 2009, which pages are hereby incorporated by reference; (3) under the caption, "International Cross-Border Outstandings" on page 35 of Comerica's Annual Report to Shareholders for the year ended December 31, 2009, which page is hereby incorporated by reference; and (4) under the caption "Allowance for Credit Losses" on pages 39 through 41 of Comerica's Annual Report to Shareholders for the year ended December 31, 2009, which pages are hereby incorporated by reference.

COMPETITION

The financial services business is highly competitive. Comerica's banking subsidiaries compete primarily with banks based in its primary areas of operations in the United States for loans, deposits and trust accounts. Through its offices in Arizona, California, Colorado, Delaware, Florida, Illinois, Massachusetts, Michigan, Minnesota, North Carolina, Nevada, New Jersey, New York, Ohio, Tennessee, Texas, Virginia and Washington, Comerica competes with other financial institutions for various deposits, loans and/or other products and services.

Based on the Riegle-Neal Interstate Banking and Branching Efficiency Act of 1994 (the "Interstate Act") and the Gramm-Leach-Bliley Act as described below, Comerica believes that the level of competition in all geographic markets will increase in the future. In addition to banks, Comerica's banking subsidiaries also face competition from other financial intermediaries, including savings and loan associations, consumer finance companies, leasing companies, venture capital funds, credit unions, investment banks, insurance companies and securities firms.

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SUPERVISION AND REGULATION

Banks, bank holding companies and financial institutions are highly regulated at both the state and federal level. Comerica is subject to supervision and regulation at the federal level by the Board of Governors of the Federal Reserve System ("FRB") under the Bank Holding Company Act of 1956, as amended.

The Gramm-Leach-Bliley Act expanded the activities in which a bank holding company registered as a financial holding company can engage. The conditions to be a financial holding company include, among others, the requirement that each depository institution subsidiary of the holding company be well capitalized and well managed.

Comerica became a financial holding company in 2000. As a financial holding company, Comerica may affiliate with securities firms and insurance companies and engage in activities that are financial in nature. Activities that are "financial in nature" include, but are not limited to: securities underwriting; securities dealing and market making; sponsoring mutual funds and investment companies; insurance underwriting and agency; merchant banking; travel agent services; and activities that the FRB has determined to be financial in nature or incidental or complementary to a financial activity, provided that it does not pose a substantial risk to the safety or soundness of the depository institution or the financial system generally. A bank holding company that is not also a financial holding company is limited to engaging in banking and other activities previously determined by the FRB to be closely related to banking.

Comerica Bank is chartered by the State of Texas and at the state level is supervised and regulated by the Texas Department of Banking. Comerica Bank is a member of the Federal Reserve System ("FRS") and supervised and regulated by the Federal Reserve Bank of Dallas. Comerica Bank & Trust, National Association is chartered under federal law and is subject to supervision and regulation by the Office of the Comptroller of the Currency ("OCC"). Comerica Bank & Trust, National Association is also a member of the FRS. The deposits of Comerica Bank and Comerica Bank & Trust, National Association are insured by the Deposit Insurance Fund of the Federal Deposit Insurance Corporation ("FDIC") to the extent provided by law.

The FRB supervises non-banking activities conducted by companies directly and indirectly owned by Comerica. In addition, Comerica's non-banking subsidiaries are subject to supervision and regulation by various state, federal and self-regulatory agencies, including, but not limited to, the Financial Industry Regulatory Authority (in the case of Comerica Securities, Inc. and Comerica Capital Markets Corporation), the Office of Financial and Insurance Services of the State of Michigan (in the case of Comerica Securities, Inc. and Comerica Insurance Services, Inc.), and the Securities and Exchange Commission (in the case of Comerica Securities, Inc., Comerica Capital Markets Corporation and World Asset Management, Inc.).

In most cases, no FRB approval is required for Comerica to acquire a company engaged in activities that are financial in nature or incidental to activities that are financial in nature, as determined by the FRB. Prior FRB approval, however, is required before Comerica may acquire the beneficial ownership or control of more than 5% of the voting shares or substantially all of the assets of a financial or bank holding company or a bank. Comerica's current rating under the Community Reinvestment Act of 1977 ("CRA") is "outstanding". If any subsidiary bank of Comerica were to receive a rating under the CRA of less than "satisfactory", Comerica would be prohibited from engaging in certain activities. In addition, Comerica is "well capitalized" and "well managed" under FRB standards. If any subsidiary bank of Comerica were to cease being "well capitalized" or "well managed" under applicable regulatory standards, the FRB could place limitations on Comerica's ability to conduct the broader financial activities permissible for financial holding companies or impose limitations or conditions on the conduct or activities of Comerica or its affiliates. If the deficiencies persisted, the FRB could order Comerica to divest any subsidiary bank or to cease engaging in any

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activities permissible for financial holding companies that are not permissible for bank holding companies, or Comerica could elect to conform its non-banking activities to those permissible for a bank holding company that is not also a financial holding company.

Various governmental requirements, including Sections 23A and 23B of the Federal Reserve Act and the FRB's Regulation W, limit borrowings by Comerica and its nonbank subsidiaries from its affiliate insured depository institutions, and also limit various other transactions between Comerica and its nonbank subsidiaries, on the one hand, and its affiliate insured depository institutions, on the other. For example, Section 23A of the Federal Reserve Act limits the aggregate outstanding amount of any insured depository institution's loans and other "covered transactions" with any particular nonbank affiliate to no more than 10% of the institution's total capital and limits the aggregate outstanding amount of any insured depository institution's covered transactions with all of its nonbank affiliates to no more than 20% of its total capital. Section 23A of the Federal Reserve Act also generally requires that an insured depository institution's loans to its nonbank affiliates be, at a minimum, 100% secured, and Section 23B of the Federal Reserve Act generally requires that an insured depository institution's transactions with its nonbank affiliates be on arms-length terms.

Set forth below are summaries of selected laws and regulations applicable to Comerica and its domestic banks and other subsidiaries. The summaries are not complete, are qualified in their entirety by references to the particular statutes and regulations, and are not intended as legal advice. A change in applicable law or regulation could have a material effect on the business of Comerica.

Interstate Banking and Branching

Pursuant to the Interstate Banking and Branching Efficiency Act (the "Interstate Act"), a bank holding company may acquire banks in states other than its home state, without regard to the permissibility of such acquisition under state law, but subject to any state requirement that the bank has been organized and operating for a minimum period of time, not to exceed five years, and the requirement that the bank holding company, prior to and following the proposed acquisition, control no more than 10% of the total amount of deposits of insured depository institutions in the United States and no more than 30% of such deposits in that state (or such amount as established by state law if such amount is lower than 30%).

The Interstate Act also authorizes banks to acquire branch offices outside their home states by merging with out-of-state banks, purchasing branches in other states and establishing de novo branches in other states, thereby creating interstate branching, provided that, in the case of purchasing branches and establishing new branches in a state in which it does not already have banking operations, such state must have "opted-in" to the Interstate Act by enacting a law permitting such branch purchases or de novo branching and, in the case of mergers, such state must not have "opted-out" of that portion of the Interstate Act.

As permitted by the Interstate Act, Comerica has consolidated most of its banking business into one bank, Comerica Bank, with branches in Texas, Michigan, California, Florida and Arizona.

Dividends

Comerica is a legal entity separate and distinct from its banking and other subsidiaries. Most of Comerica's revenues result from dividends its bank subsidiaries pay it. There are statutory and regulatory requirements applicable to the payment of dividends by subsidiary banks to Comerica, as well as by Comerica to its shareholders. Certain, but not all, of these requirements are discussed below.

Comerica Bank and Comerica Bank & Trust, National Association are required by federal law to obtain the prior approval of the FRB and/or the OCC, as the case may be, for the declaration and payment of dividends, if the total of all dividends declared by the board of directors of such bank in

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any calendar year will exceed the total of (i) such bank's retained net income (as defined and interpreted by regulation) for that year plus (ii) the retained net income (as defined and interpreted by regulation) for the preceding two years, less any required transfers to surplus or to fund the retirement of preferred stock. Further, federal regulatory agencies can prohibit a banking institution or bank holding company from engaging in unsafe and unsound banking practices and could prohibit the payment of dividends under circumstances in which such payment could be deemed an unsafe and unsound banking practice. In addition, Comerica Bank is also subject to limitations under Texas state law regarding the amount of earnings that may be paid out as dividends, and requiring prior approval for payments of dividends that exceed certain levels.

At January 1, 2010, Comerica's subsidiary banks, without obtaining prior governmental approvals, could declare aggregate dividends of approximately $56 million from retained net profits of the preceding two years, plus an amount approximately equal to the retained net profits (as measured under current regulations), if any, earned for the period from January 1, 2010 through the date of declaration. Comerica has sufficient liquid assets at December 31, 2009 to fulfill its 2010 dividend payment objectives without reliance on dividends from banking subsidiaries. Comerica's subsidiary banks declared dividends of $59 million in 2009, $267 million in 2008, and $614 million in 2007 without the need for prior governmental approvals. In addition, as a participant in the Capital Purchase Program, effective November 14, 2008, Comerica cannot increase its quarterly dividend above $0.33 per common share (the quarterly dividend rate in effect as of November 14, 2008). For a discussion of the Capital Purchase Program, please refer to pages 8 and 9 of this Annual Report on Form 10-K.

Source of Strength

FRB regulations require that bank holding companies serve as a source of strength to each subsidiary bank and commit resources to support each subsidiary bank. This support may be required at times when a bank holding company may not be able to provide such support without adversely affecting its ability to meet other obligations. Similarly, under the cross-guarantee provisions of the Federal Deposit Insurance Act, in the event of a loss suffered or anticipated by the FDIC (either as a result of the failure of a banking or thrift subsidiary or related to FDIC assistance provided to such a subsidiary in danger of failure), the other banking subsidiaries may be assessed for the FDIC's loss, subject to certain exceptions.

FDICIA

The Federal Deposit Insurance Corporation Improvement Act ("FDICIA") requires, among other things, the federal banking agencies to take "prompt corrective action" in respect of depository institutions that do not meet minimum capital requirements. FDICIA establishes five capital tiers: "well capitalized," "adequately capitalized," "undercapitalized," "significantly undercapitalized" and "critically undercapitalized." A depository institution's capital tier will depend upon where its capital levels are in relation to various relevant capital measures, which, among others, include a Tier 1 and total risk-based capital measure and a leverage ratio capital measure.

Regulations establishing the specific capital tiers provide that, for a depository institution to be well capitalized, it must have a total risk-based capital ratio of at least 10% and a Tier 1 risk-based capital ratio of at least 6%, a Tier 1 leverage ratio of at least 5% and not be subject to any specific capital order or directive. For an institution to be adequately capitalized, it must have a total risk-based capital ratio of at least 8%, a Tier 1 risk-based capital ratio of at least 4%, and a Tier 1 leverage ratio of at least 4% (and in some cases 3%). Under certain circumstances, the appropriate banking agency may treat a well capitalized, adequately capitalized or undercapitalized institution as if the institution were in the next lower capital category.

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As of December 31, 2009, Comerica and its U.S. banking subsidiaries exceeded the ratios required for an institution to be considered "well capitalized" under these regulations.

FDICIA generally prohibits a depository institution from making any capital distribution (including payment of a dividend) or paying any management fee to its holding company if the depository institution would thereafter be undercapitalized. Undercapitalized depository institutions are subject to limitations on growth and certain activities and are required to submit an acceptable capital restoration plan. The federal banking agencies may not accept a capital plan without determining, among other things, that the plan is based on realistic assumptions and is likely to succeed in restoring the depository institution's capital. In addition, for a capital restoration plan to be acceptable, the depository institution's parent holding company must guarantee for a specific time period that the institution will comply with such capital restoration plan. The aggregate liability of the parent holding company under the guaranty is limited to the lesser of (i) an amount equal to 5% of the depository institution's total assets at the time it became undercapitalized, or (ii) the amount that is necessary (or would have been necessary) to bring the institution into compliance with all capital standards applicable with respect to such institution as of the time it fails to comply with the plan. If a depository institution fails to submit or implement an acceptable plan, it is treated as if it is significantly undercapitalized.

Significantly undercapitalized depository institutions are subject to a number of requirements and restrictions. Specifically, such a depository institution may be required to do one or more of the following, among other things: sell sufficient voting stock to become adequately capitalized, reduce the interest rates it pays on deposits, reduce its rate of asset growth, dismiss certain senior executive officers or directors, or stop accepting deposits from correspondent banks. Critically undercapitalized institutions are subject to the appointment of a receiver or conservator or such other action as the FDIC and the applicable federal banking agency shall determine appropriate.

FDICIA also contains a variety of other provisions that may affect the operations of depository institutions including reporting requirements, regulatory standards for real estate lending, "truth in savings" provisions, the requirement that a depository institution give 90 days prior notice to customers and regulatory authorities before closing any branch, and a prohibition on the acceptance or renewal of brokered deposits by depository institutions that are not well capitalized or are adequately capitalized and have not received a waiver from the FDIC.

Capital Requirements

Comerica and its bank subsidiaries are subject to risk-based capital requirements and guidelines imposed by the FRB and/or the OCC.

For this purpose, a depository institution's or holding company's assets and certain specified off-balance sheet commitments are assigned to four risk categories, each weighted differently based on the level of credit risk that is ascribed to such assets or commitments. A depository institution's or holding company's capital, in turn, is divided into two tiers: core ("Tier 1") capital, which includes common equity, non-cumulative perpetual preferred stock, and a limited amount of cumulative perpetual preferred stock and related surplus (excluding auction rate issues) and minority interests in equity accounts of consolidated subsidiaries, less goodwill, certain identifiable intangible assets and certain other assets; and supplementary ("Tier 2") capital, which includes, among other items, perpetual preferred stock not meeting the Tier 1 definition, mandatory convertible securities, subordinated debt, and allowances for loan and lease losses, subject to certain limitations, less certain required deductions. Bank holding companies that engage in trading activities, whose trading activities exceed specified levels, also are required to maintain capital for market risk. Market risk includes changes in the market value of trading account, foreign exchange, and commodity positions, whether resulting from broad market movements (such as changes in the general level of interest rates, equity prices, foreign exchange rates, or commodity prices) or from position specific factors.

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Comerica, like other bank holding companies, currently is required to maintain Tier 1 and "total capital" (the sum of Tier 1 and Tier 2 capital) equal to at least 4% and 8% of its total risk-weighted assets (including certain off-balance-sheet items, such as standby letters of credit), respectively. At December 31, 2009, Comerica met both requirements, with Tier 1 and total capital equal to 12.46% and 16.93% of its total risk-weighted assets, respectively.

Comerica is also required to maintain a minimum "leverage ratio" (Tier 1 capital to adjusted total assets) of 3% to 5%, depending upon criteria defined and assessed by the FRB. Comerica's leverage ratio of 13.25% at December 31, 2009 reflects the nature of Comerica's balance sheet and demonstrates a commitment to capital adequacy.

As an additional means to identify problems in the financial management of depository institutions, FDICIA requires federal bank regulatory agencies to establish certain non-capital safety and soundness standards for institutions any such agency supervises. The standards relate generally to, among others, earnings, liquidity, operations and management, asset quality, various risk and management exposures ( e.g. , credit, operational, market, interest rate, etc.) and executive compensation. The agencies are authorized to take action against institutions that fail to meet such standards.

FDIC Insurance Assessments

Comerica's subsidiary banks are subject to FDIC deposit insurance assessments to maintain the Deposit Insurance Fund ("DIF"). Additionally, in the fourth quarter of 2008, Comerica and its subsidiary banks elected to participate in the FDIC's Transaction Account Guarantee Program that requires the payment of additional insurance premiums to the FDIC. During the fourth quarter of 2009, Comerica further elected to continue its participation in the FDIC's Transaction Account Guarantee Program through June 30, 2010.

As of December 31, 2009, Comerica's banking subsidiaries held approximately $38.9 billion of DIF-assessable deposits. Prior to 2007, Comerica's banking subsidiaries had not paid nor been assessed deposit insurance assessments on DIF-assessable deposits under the FDIC's risk related assessment system. The FDIC's risk related assessment system was revised effective January 1, 2007, however, and Comerica's banking subsidiaries were assessed deposit insurance premiums on a quarterly basis, beginning in June 2007. In 2008, these assessment premiums totaled $26.8 million and were first applied against the remaining credit of $17.1 million. During the second quarter of 2009, the FDIC levied an industry-wide special assessment charge on insured financial institutions as part of the agency's efforts to rebuild DIF. In November 2009, the FDIC amended regulations that required insured institutions to prepay their estimated quarterly risk-based assessments for the fourth quarter of 2009 and for all of 2010-2012. The prepaid assessments will be applied against future quarterly assessments (as they may be so revised) until the prepaid assessment is exhausted or the balance of the prepayment is returned, whichever occurs first. Comerica paid such prepaid assessment on December 30, 2009, along with its regular quarterly risk-based deposit insurance assessment for the third quarter of 2009. In 2009, these assessment premiums totaled $281 million, including the second quarter special assessment of $29 million and prepaid assessments of $200 million (which includes assessments that will be expensed by Comerica during 2010-2012).

In addition, on January 12, 2010, the FDIC announced that it would seek public comment on whether financial institutions with compensation plans that encourage risky behavior should be charged higher deposit assessment rates than such financial institutions would otherwise be charged.

The FDIC is not precluded from changing assessment rates or from further revising the risk-based assessment system during the prepayment period or thereafter. Thus, Comerica may also be required to pay significantly higher FDIC insurance assessments premiums in the future because market developments significantly depleted DIF and reduced the ratio of reserves to insured deposits.

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Enforcement Powers of Federal Banking Agencies

The FRB and other federal banking agencies have broad enforcement powers, including the power to terminate deposit insurance, impose substantial fines and other civil penalties and appoint a conservator or receiver. Failure to comply with applicable laws or regulations could subject Comerica or its banking subsidiaries, as well as officers and directors of these organizations, to administrative sanctions and potentially substantial civil and criminal penalties.

Recent Regulatory Developments

In response to global credit and liquidity issues involving a number of financial institutions, the United States government, particularly the United States Department of the Treasury (the "U.S. Treasury") and the FDIC, have taken a variety of extraordinary measures designed to restore confidence in the financial markets and to strengthen financial institutions, including capital injections, guarantees of bank liabilities and the acquisition of illiquid assets from banks.

Among other programs and actions taken by the U.S. regulatory agencies, the FDIC implemented the Temporary Liquidity Guarantee Program ("TLGP") to strengthen confidence and encourage liquidity in the banking system. The TLGP is comprised of the Debt Guarantee Program ("DGP") and the Transaction Account Guarantee Program ("TAGP"). The DGP guarantees all newly issued senior unsecured debt (e.g., promissory notes, unsubordinated unsecured notes and commercial paper) up to prescribed limits issued by participating entities beginning on October 14, 2008 and continuing through October 31, 2009. For eligible debt issued by that date, the FDIC will provide the guarantee coverage until the earlier of the maturity date of the debt or December 31, 2012 (or June 30, 2012 for debt issued prior to April 1, 2009). The TAGP offers full guarantee for noninterest-bearing transaction accounts held at FDIC-insured depository institutions. The unlimited deposit coverage was voluntary for eligible institutions and was in addition to the $250,000 FDIC deposit insurance per account that was included as part of the EESA. The TAGP coverage became effective on October 14, 2008 and will continue for Comerica and other participating institutions until June 30, 2010.

Capital Purchase Program

Pursuant to the Capital Purchase Program, on November 14, 2008, Comerica issued to the U.S. Treasury, in exchange for aggregate consideration of $2.25 billion, (1) 2.25 million shares of Fixed Rate Cumulative Perpetual Preferred Stock, Series F, no par value (the "Series F Preferred Stock"), and (2) a warrant to purchase 11,479,592 shares of Comerica's common stock at an exercise price of $29.40 per share (the "Warrant"). The number of shares of common stock to be issued pursuant to the Warrant and the exercise price of the Warrant are subject to anti-dilution and other adjustments from time to time following, among other things, stock splits, subdivisions or combinations, certain issuances of common stock or convertible securities and certain repurchases of common stock. The Series F Preferred Stock (a) has a liquidation amount per share equal to $1,000 for an aggregate value of $2.25 billion and (b) pays a cumulative annual dividend of five percent (5%) for the first five years and nine percent (9%) on an annual basis thereafter. The Warrant expires ten years from the issuance date. Both the Series F Preferred Stock and the Warrant were accounted for as components of Comerica's regulatory Tier 1 capital. The letter

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agreement between the U.S. Treasury and Comerica, dated November 14, 2008, including the securities purchase agreement (the "Purchase Agreement") concerning the issuance and sale of the Series F Preferred Stock and the Warrant, grants the holders of the Series F Preferred Stock, the Warrant and Comerica common stock to be issued under the Warrant certain registration rights and imposes restrictions on dividend and stock repurchases. For example, Comerica's participation in the Capital Purchase Program limits, without the consent of the U.S. Treasury, its ability to (i) increase its quarterly dividend above $0.33 per common share (the quarterly dividend rate in effect as of November 14, 2008) or (ii) repurchase any of its shares with limited exceptions, most significantly purchases in connection with benefit plans. In addition, the terms of Purchase Agreement subject Comerica to certain executive compensation limitations as set forth in the EESA. For additional details about the Capital Purchase Program, please refer to page 37 under the caption "Capital" and Note 15 on pages 116 through 118 of the Consolidated Financial Statements contained in Comerica's Annual Report to Shareholders for the year ended December 31, 2009.

Temporary Liquidity Guarantee Program

Initially, the TLGP programs, the DGP and TAGP, were provided at no cost for the first 30 days. On November 3, 2008, the FDIC extended the opt-out period to December 5, 2008 to provide eligible institutions additional time to consider the terms before making a final decision regarding participation in the program through December 31, 2009. On December 5, 2008, Comerica announced that it and two of its subsidiaries, Comerica Bank and Comerica Bank & Trust, National Association, formally elected to continue their participation in the TLGP. As a result, they will continue participating in the DGP and the TAGP to the extent applicable. Participants in the DGP are charged an annualized fee ranging from 50 basis points (bps) to 100 bps (depending on the maturity of the debt issued) multiplied by the amount of debt issued, and calculated for the maturity period of that debt, or through June 30, 2012, whichever is earlier. Based on the terms of the DGP, Comerica Bank could have issued up to approximately $5.2 billion of qualifying senior debt securities covered by the DGP. As of December 31, 2009, there was approximately $7 million of senior unsecured debt outstanding in the form of bank-to-bank deposits issued under the DGP. In addition to the existing risk-based deposit insurance premium paid on such deposits, TAGP participants will be assessed, on a quarterly basis, an annualized 10 bps fee on balances in noninterest-bearing transaction accounts that exceed the existing deposit insurance limit of $250,000.

Effective October 1, 2009, in order to assure an orderly phase out of the TAGP, FDIC extended the TAGP for six months until June 30, 2010. Any insured depository institution that was participating in the TAG program as of October 1, 2009 was permitted to continue in the TAGP during the extension period that ends on June 30, 2010. The annual assessment rate that applies to participating institutions during the extension period is either 15 basis points, 20 basis points or 25 basis points, depending on the "Risk Category" assigned to the institution under the FDIC's risk-based premium system. Any institution participating in the TAG program as of October 1, 2009 that desired to opt out of the TAG extension was required to submit its opt-out election to the FDIC on or before November 2, 2009. Any such election to opt out was effective on January 1, 2010. Neither Comerica Bank nor Comerica Bank & Trust, National Association elected to opt out of the TAGP's extension period, so they will continue to participate in the TAGP through June 30, 2010.

For additional details about the Temporary Liquidity Guarantee Program, see (i) pages 35 and 36 under the caption "Deposits and Borrowed Funds" and (ii) Note 14 on pages 114 through 116 of the Consolidated Financial Statements contained in Comerica's Annual Report to Shareholders for the year ended December 31, 2009.

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On February 17, 2009, the American Recovery and Reinvestment Act of 2009 (the "ARRA") was signed into law. Section 7001 of the ARRA amended Section 111 of the EESA in its entirety. On June 10, 2009, the U.S. Treasury released an interim final rule (the "IFR"), effective June 15, 2009, that provided guidance on the compensation and governance standards for Troubled Asset Relief Program ("TARP") recipients, and promulgated regulations to implement the restrictions and standards set forth in Section 7001 of the ARRA. Among other things, the IFR and ARRA significantly expanded the executive compensation restrictions previously imposed by the EESA. Such restrictions apply to any entity that has received or will receive financial assistance under TARP, and shall generally continue to apply for as long as any obligation arising from financial assistance provided under TARP, including preferred stock issued under the Capital Purchase Program, remains outstanding. These ARRA restrictions shall not apply to any Troubled Asset Relief Program recipient during such time when the federal government (i) only holds any warrants to purchase common stock of such recipient or (ii) does not hold any preferred stock or warrants to purchase common stock of such recipient. As a result of our participation in the Capital Purchase Program, the restrictions and standards set forth in Section 7001 of the ARRA, as well as the IFR promulgated by the U.S. Treasury, shall be applicable to Comerica. Pursuant to Section 7001(g) of the ARRA, Comerica shall be permitted to repay the $2.25 billion it received under the Capital Purchase Program, subject to consultation with the Federal Reserve, without regard to certain repayment restrictions in the Purchase Agreement.

On May 20, 2009, the Helping Families Save Their Homes Act of 2009, which extended the temporary increase in the standard maximum deposit insurance amount provided by the FDIC to $250,000 per depositor through December 31, 2013, was signed into law. This extension of the temporary $250,000 coverage limit (pursuant to the EESA) became effective immediately upon the President's signature. The legislation provides that the standard maximum deposit insurance amount provided by the FDIC will return to $100,000 on January 1, 2014.

On October 22, 2009, the Federal Reserve issued a comprehensive proposal on incentive compensation policies (the "Incentive Compensation Proposal") intended to ensure that the incentive compensation policies of banking organizations do not undermine the safety and soundness of such organizations by encouraging excessive risk-taking. This guidance sets expectations for banking organizations concerning their incentive compensation arrangements and related risk-management, control, and governance processes. The Incentive Compensation Proposal, which covers all employees that have the ability to materially affect the risk profile of an organization, either individually or as part of a group, is based upon three primary principles: (i) balanced risk-taking incentives, (ii) compatibility with effective controls and risk management, and (iii) strong corporate governance. Any deficiencies in compensation practices that are identified may be incorporated into the organization's supervisory ratings, which can affect its ability to make acquisitions or perform other actions. In addition, under the Incentive Compensation Proposal, the Federal Reserve in appropriate circumstances may take enforcement action against a banking organization.

On November 12, 2009, the Federal Reserve adopted amendments to its Regulation E, effective July 1, 2010, that will prohibit financial institutions from charging clients overdraft fees on automated teller machines ("ATM") and one-time debit card transactions, unless a consumer consents, or opts in, to the overdraft service for those type of transactions. Pursuant to the adopted regulation, clients must opt-in to an overdraft service in order for the financial institution to collect overdraft fees. If a consumer does not opt in, any ATM transaction or debit that overdraws the consumer's account will be denied. Overdrafts on the payment of checks and regular electronic bill payments are not covered by this new rule. Before opting in, the consumer must be provided a notice that explains the financial institution's overdraft services, including the fees associated with the service, and the consumer's choices. Financial institutions must provide consumers who do not opt in with the same account terms, conditions and features (including pricing) that they provide to consumers who do opt in.

On January 14, 2010, the current administration announced a proposal to impose a fee (the "Financial Crisis Responsibility Fee") on those financial institutions that benefited from recent actions

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taken by the U.S. government to stabilize the financial system. If implemented as initially proposed, the Financial Crisis Responsibility Fee will be applied to firms with over $50 billion in consolidated assets, and, therefore, by its terms would apply to Comerica. The Financial Crisis Responsibility Fee would be collected by the Internal Revenue Service and would be approximately fifteen basis points, or 0.15%, of an amount calculated by subtracting a covered institution's Tier 1 capital and FDIC-assessed deposits (and/or an adjustment for insurance liabilities covered by state guarantee funds) from such institution's total assets.

The Financial Crisis Responsibility Fee, if implemented as proposed by the current administration, would go into effect on June 30, 2010 and remain in place for at least ten years. The U.S. Treasury would be asked to report after five years on the effectiveness of the Financial Crisis Responsibility Fee as well as its progress in repaying projected losses to the U.S. government as a result of the TARP. If losses to the U.S. government as a result of TARP have not been recouped after ten years, the Financial Crisis Responsibility Fee would remain in place until such losses have been recovered.

Future Legislation

Changes to the laws of the states and countries in which Comerica and its subsidiaries do business could affect the operating environment of bank holding companies and their subsidiaries in substantial and unpredictable ways. Moreover, in light of recent events and current conditions in the U.S. financial markets and economy, Congress and regulators have continued to increase their focus on the regulation of the financial services industry. Comerica cannot accurately predict whether legislative changes will occur or, if they occur, the ultimate effect they would have upon the financial condition or results of operations of Comerica.

EMPLOYEES

As of December 31, 2009, Comerica and its subsidiaries had 8,939 full-time and 781 part-time employees.

AVAILABLE INFORMATION

Comerica maintains an Internet website at www.comerica.com where the Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and all amendments to those reports are available without charge, as soon as reasonably practicable after those reports are filed with or furnished to the U.S. Securities and Exchange Commission. The Code of Business Conduct and Ethics for Employees, the Code of Business Conduct and Ethics for Members of the Board of Directors and the Senior Financial Officer Code of Ethics adopted by Comerica are also available on the Internet website and are available in print to any shareholder who requests them. Such requests should be made in writing to the Corporate Secretary at Comerica Incorporated, Comerica Bank Tower, 1717 Main Street, MC 6404, Dallas, Texas 75201.

Item 1A. Risk Factors.

This Report includes forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. In addition, Comerica may make other written and oral communications from time to time that contain such statements. All statements regarding Comerica's expected financial position, strategies and growth prospects and general economic conditions Comerica expects to exist in the future are forward-looking statements. The words, "anticipates," "believes," "feels," "expects," "estimates," "seeks," "strives," "plans," "intends," "outlook," "forecast," "position," "target," "mission," "assume," "achievable," "potential," "strategy," "goal," "aspiration," "outcome," "continue," "remain," "maintain," "trend," "objective" and variations of such words and similar expressions, or future or conditional verbs such as "will," "would," "should," "could," "might," "can," "may" or

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similar expressions, as they relate to Comerica or its management, are intended to identify forward-looking statements.

Comerica cautions that forward-looking statements are subject to numerous assumptions, risks and uncertainties, which change over time. Forward-looking statements speak only as of the date the statement is made, and Comerica does not undertake to update forward-looking statements to reflect facts, circumstances, assumptions or events that occur after the date the forward-looking statements are made. Actual results could differ materially from those anticipated in forward-looking statements, and future results could differ materially from historical performance.

In addition to factors mentioned elsewhere in this Report or previously disclosed in Comerica's SEC reports (accessible on the SEC's website at www.sec.gov or on Comerica's website at www.comerica.com ), the factors contained below, among others, could cause actual results to differ materially from forward-looking statements, and future results could differ materially from historical performance.

•: General political, economic or industry conditions, either domestically or internationally, may be less favorable than expected.

Local, domestic, and international economic, political and industry specific conditions affect the financial services industry, directly and indirectly. Conditions such as or related to inflation, recession, unemployment, volatile interest rates, international conflicts and other factors, such as real estate values, energy costs and fuel prices, outside of our control may, directly and indirectly, adversely affect Comerica. As has been the case with impact of recent economic conditions, economic downturns could result in the delinquency of outstanding loans, which could have a material adverse impact on Comerica's earnings.

•: Governmental monetary and fiscal policies may adversely affect the financial services industry, and therefore impact Comerica's financial condition and results of operations.

Monetary and fiscal policies of various governmental and regulatory agencies, in particular the Federal Reserve Board, affect the financial services industry, directly and indirectly. The Federal Reserve Board regulates the supply of money and credit in the United States and its monetary and fiscal policies determine in a large part Comerica's cost of funds for lending and investing and the return that can be earned on such loans and investments. Changes in such policies, including changes in interest rates, will influence the origination of loans, the value of investments, the generation of deposits and the rates received on loans and investment securities and paid on deposits. Changes in monetary and fiscal policies are beyond Comerica's control and difficult to predict. Comerica's financial condition and results of operations could be materially adversely impacted by changes in governmental monetary and fiscal policies.

•: Volatility and disruptions in the functioning of the financial markets and related liquidity issues could continue or worsen and, therefore, may adversely impact Comerica's business, financial condition and results of operations.

The financial markets have been experiencing volatility and disruption in recent periods. The impact of this situation, together with concerns regarding the financial strength of financial institutions, has led to distress in financial markets and issues relating to liquidity among financial institutions. As a result of concern about the stability of the financial markets generally, the resulting credit availability issues, lack of confidence in the financial sector, increased volatility in the financial markets and reduced business activity could have a material adverse effect on Comerica's ability to access capital and manage liquidity. If current levels of financial market volatility and disruption continue or worsen, there can be no assurance that Comerica's business, financial condition and results of operations will not be materially and adversely impacted.

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•: Changes in the performance and creditworthiness of customers and other counterparties may adversely impact Comerica's business, financial condition and results of operations.

Current market developments and economic conditions have affected consumer confidence levels which may result in adverse changes in payment patterns of Comerica's customers. This market turmoil and the tightening of credit have led to an increased level of consumer and commercial delinquencies, lack of consumer confidence and widespread reduction of business activity generally. A worsening of these conditions would likely aggravate the adverse effects of these difficult market conditions on Comerica, Comerica's customers and others in the financial institutions industry. Increased delinquencies and default rates may impact Comerica's loan charge-offs and related provisioning for loan losses. Deterioration in the quality of its credit portfolio could have an adverse impact on Comerica's business, financial condition and results of operations.

•: The soundness of other financial institutions could adversely affect Comerica.

Comerica's ability to engage in routine funding transactions could be adversely affected by the actions and commercial soundness of other financial institutions. Financial services institutions are interrelated as a result of trading, clearing, counterparty or other relationships. Comerica has exposure to many different industries and counterparties, and it routinely executes transactions with counterparties in the financial industry, including brokers and dealers, commercial banks, investment banks, mutual and hedge funds, and other institutional clients. As a result, defaults by, or even rumors or questions about, one or more financial services institutions, or the financial services industry generally, have led, and may further lead, to market-wide liquidity problems and could lead to losses or defaults by us or by other institutions. Many of these transactions could expose Comerica to credit risk in the event of default of its counterparty or client. In addition, Comerica's credit risk may be impacted when the collateral held by it cannot be realized upon or is liquidated at prices not sufficient to recover the full amount of the financial instrument exposure due to Comerica. There is no assurance that any such losses would not adversely affect, possible materially in nature, Comerica.

•: Recently enacted legislation, actions recently taken by or proposed by the United States Department of Treasury, the Federal Deposit Insurance Corporation, the Federal Reserve Bank or other governmental entities, and legislation enacted in the future subject Comerica to increased regulation, and the impact and expiration of such legislation and regulatory actions may adversely affect Comerica.

On October 3, 2008, the Emergency Economic Stabilization Act of 2008 (the "EESA") was signed into law. Pursuant to the EESA, the U.S. Treasury was granted the authority to take a range of actions for the purpose of stabilizing and providing liquidity to the U.S. financial markets and has proposed several programs, including the purchase by the U.S. Treasury of certain troubled assets from financial institutions and the direct purchase by the U.S. Treasury of equity of financial institutions. Pursuant to the EESA, the U.S. Treasury has the authority to, among other things, purchase up to $700 billion of mortgages, mortgage-backed securities and certain other financial instruments from financial institutions for the purpose of stabilizing and providing liquidity to the U.S. financial markets. In connection therewith, the U.S. Treasury introduced the Capital Purchase Program, under which it has purchased approximately $196 billion of preferred stock in eligible institutions, including Comerica, to increase the flow of financing to U.S. businesses and consumers and to support the U.S. economy. The EESA also temporarily raised the limit on federal deposit insurance coverage provided by the FDIC from $100,000 to $250,000 per depositor.

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President's signature. The legislation provides that the standard maximum deposit insurance amount provided by the FDIC will return to $100,000 on January 1, 2014.

On October 14, 2008, the FDIC announced the development of a guarantee program under the systemic risk exception to the Federal Deposit Act. As a result of this regulatory initiative, the FDIC implemented the Temporary Liquidity Guarantee Program ("TLGP") to strengthen confidence and encourage liquidity in the banking system. The TLGP is comprised of the Debt Guarantee Program ("DGP") and the Transaction Account Guarantee Program ("TAGP"). The DGP guaranteed all newly issued senior unsecured debt (e.g., promissory notes, unsubordinated unsecured notes and commercial paper) up to prescribed limits issued by participating entities beginning on October 14, 2008 and continued through October 31, 2009. For eligible debt issued by that date, the FDIC will provide the guarantee coverage until the earlier of the maturity date of the debt or December 31, 2012 (or June 30, 2012 for debt issued prior to April 1, 2009). The TAGP offers full guarantee for noninterest-bearing transaction accounts held at FDIC-insured depository institutions. The unlimited deposit coverage was voluntary for eligible institutions and was in addition to the $250,000 FDIC deposit insurance per account that was included as part of the EESA and the Helping Families Save Their Homes Act, respectively. The limits are presently scheduled to return to $100,000 on January 1, 2014. The TAGP coverage became effective on October 14, 2008 and will continue for Comerica and participating institutions until June 30, 2010.

During the second quarter of 2009, the FDIC levied an industry-wide special assessment charge on insured financial institutions as part of the agency's efforts to rebuild DIF. In November 2009, the FDIC amended regulations that required insured institutions to prepay their estimated quarterly risk-based assessments for the fourth quarter of 2009 and for all of 2010-2012. The prepaid assessments will be applied against future quarterly assessments (as they may be so revised) until the prepaid assessment is exhausted or the balance of the prepayment is returned, whichever occurs first. The FDIC is not precluded from changing assessment rates or from further revising the risk-based assessment system during the prepayment period or thereafter. Thus, we may also be required to pay significantly higher FDIC insurance assessments premiums in the future because market developments significantly depleted DIF and reduced the ratio of reserves to insured deposits.

The programs and regulations established or to be established under the EESA and Capital Purchase Program may have adverse effects upon Comerica. It may face increased regulation of the financial services industry. Compliance with such regulation may increase Comerica's costs and limit its ability to pursue business opportunities. Also, participation in specific programs may subject Comerica to additional restrictions. For example, Comerica's participation in the Capital Purchase Program limits, without the consent of the U.S. Treasury, its ability to (a) increase its quarterly dividend above $0.33 per common share (the quarterly dividend rate in effect as of November 14, 2008) or (b) repurchase any of its shares with limited exceptions, most significantly purchases in connection with benefit plans. Comerica also issued a warrant to purchase 11,479,592 million of its common shares at an exercise price of $29.40 per share. These restrictions, as well as the potential dilutive impact of the warrant, may have an adverse effect on the market price of its common stock. Comerica's participation in the TAGP will require the payment of additional insurance premiums to the FDIC, in addition to the FDIC's regular and special assessments. The affects of such recently enacted legislation and regulatory actions on Comerica cannot reliably be determined at this time. Moreover, as some of the legislation and regulatory actions previously implemented in response to the recent financial crisis expire, the impact of the conclusion of these programs on the financial sector and on the economic recovery is unknown. Any delay in the economic recovery or a continuation or worsening of current financial market conditions could adversely affect Comerica.

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Recently, the Federal Reserve adopted amendments to its Regulation E that will be effective on July 1, 2010. The changes will affect the circumstances when Comerica will be able to charge its clients overdraft fees.

On January 14, 2010, the current administration announced a proposal to impose a fee (the "Financial Crisis Responsibility Fee") on those financial institutions that benefited from recent actions taken by the U.S. government to stabilize the financial system. If implemented as initially proposed, the Financial Crisis Responsibility Fee will be applied to firms with over $50 billion in consolidated assets, and, therefore, by its terms would apply to Comerica. The Financial Crisis Responsibility Fee, if implemented as proposed by the current administration, would go into effect on June 30, 2010 and remain in place for at least ten years.

In addition, there have been a number of recent legislative and regulatory proposals that could have an impact on the operations of Comerica and its subsidiaries. We can neither predict when or whether regulatory or legislative reforms will be enacted nor what their contents will be. The impact of any future legislation or regulatory actions on Comerica's businesses or operations cannot be reliably determined at this time, and such impact may adversely affect Comerica.

•: Unfavorable developments concerning credit quality could adversely affect Comerica's financial results.

Although Comerica regularly reviews credit exposure related to its customers and various industry sectors in which it has business relationships, default risk may arise from events or circumstances that are difficult to detect or foresee. Under such circumstances, Comerica could experience an increase in the level of provision for credit losses, nonperforming assets, net charge-offs and reserve for credit losses, which could adversely affect Comerica's financial results.

•: Problems faced by residential real estate developers could adversely impact Comerica.

Problems in the United States' residential real estate development industry, specifically in Michigan (Midwest market) and both northern and southern California (Western market), have materially and adversely impacted Comerica in recent periods. Poor economic conditions have resulted in decreased demand for residential housing, which, in turn, has adversely affected the development and construction efforts of residential real estate developers. Consequently, the current economic downturn has adversely affected the ability of such residential real estate developer borrowers to repay these loans and the value of property used as collateral for such loans. These problems facing residential real estate developers have had, and the continuation or worsening of such problems may have, a material and adverse impact on the financial results of Comerica.

•: Businesses or industries in which Comerica has lending concentrations, including, but not limited to, automotive production industry and the real estate business, could suffer a significant decline which could adversely affect Comerica.

Comerica's business customer base consists, in part, of lending concentrations in volatile businesses and industries such as the automotive production industry and the real estate business. Recent economic conditions have significantly impacted such businesses, which has adversely affected Comerica. In the event of a continued or worsening downturn in the economy or further decline in any one of those customers' businesses or industries, Comerica could experience increased credit losses, and its business could be materially adversely affected.

•: The introduction, implementation, withdrawal, success and timing of business initiatives and strategies, including, but not limited to, the opening of new banking centers, may be less successful or may be different than anticipated, which could adversely affect Comerica's business.

Comerica makes certain projections and develops plans and strategies for its banking and financial products. If Comerica does not accurately determine demand for its banking and financial product

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needs, it could result in Comerica incurring significant expenses without the anticipated increases in revenue, which could result in a material adverse effect on its business.

•: Utilization of technology to efficiently and effectively develop, market and deliver new products and services.

The financial services industry experiences rapid technological change with regular introductions of new technology-driven products and services. The efficient and effective utilization of technology enables financial institutions to better serve customers and to reduce costs. Comerica's future success depends, in part, upon its ability to address the needs of its customers by using technology to market and deliver products and services that will satisfy customer demands and create additional efficiencies in Comerica's operations. Comerica may not be able to effectively develop new technology-driven products and services or be successful in marketing these products and services to its customers, which could have a material adverse impact on Comerica's financial condition and results of operations.

•: Operational difficulties or information security problems could adversely affect Comerica's business and operations.

Comerica is exposed to many types of operational risk, including reputational risk, legal and compliance risk, the risk of fraud or theft by employees or outsiders, unauthorized transactions by employees or operational errors, including clerical or recordkeeping errors or those resulting from computer or telecommunications systems malfunctions. Comerica may also be subject to disruptions of its operating systems arising from events that are wholly or partially beyond its control, which may include, for example, computer viruses or electrical or telecommunications outages or natural disasters. Such disruptions may give rise to losses in service to customers and loss or liability to Comerica. In addition there is the risk that Comerica's controls and procedures as well as business continuity and data security systems prove to be inadequate. Any such occurrences or failures could materially and adversely affect Comerica's business and operations by exposing it to potential liability to customers, reputational damage and regulatory intervention.

•: Changes in the financial markets, including fluctuations in interest rates and their impact on deposit pricing, could adversely affect Comerica's net interest income and balance sheet.

The operations of financial institutions such as Comerica are dependent to a large degree on net interest income, which is the difference between interest income from loans and investments and interest expense on deposits and borrowings. Prevailing economic conditions, the trade, fiscal and monetary policies of the federal government and the policies of various regulatory agencies all affect market rates of interest and the availability and cost of credit, which in turn significantly affect financial institutions' net interest income. Volatility in interest rates can also result in disintermediation, which is the flow of funds away from financial institutions into direct investments, such as federal government and corporate securities and other investment vehicles, which, because of the absence of federal insurance premiums and reserve requirements, generally pay higher rates of return than financial institutions. Comerica's financial results could be materially adversely impacted by changes in financial market conditions.

•: Competitive product and pricing pressures among financial institutions within Comerica's markets may change.

Comerica operates in a very competitive environment, which is characterized by competition from a number of other financial institutions in each market in which it operates. Comerica competes with large national and regional financial institutions and with smaller financial institutions in terms of products and pricing. If Comerica is unable to compete effectively in products and pricing in its markets, business could decline, which could have a material adverse effect on Comerica's business, financial condition or results of operations.

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•: Customer borrowing, repayment, investment and deposit practices generally may be different than anticipated.

Comerica uses a variety of financial tools, models and other methods to anticipate customer behavior as a part of its strategic planning and to meet certain regulatory requirements. Individual, economic, political, industry-specific conditions and other factors outside of Comerica's control, such as fuel prices, energy costs, real estate values or other factors that affect customer income levels, could alter predicted customer borrowing, repayment, investment and deposit practices. Such a change in these practices could materially adversely affect Comerica's ability to anticipate business needs and meet regulatory requirements.

•: Management's ability to maintain and expand customer relationships may differ from expectations.

The financial services industry is very competitive. Comerica not only vies for business opportunities with new customers, but also competes to maintain and expand the relationships it has with its existing customers. While management believes that it can continue to grow many of these relationships, Comerica will continue to experience pressures to maintain these relationships as its competitors attempt to capture its customers. Failure to create new customer relationships and to maintain and expand existing customer relationships to the extent anticipated may adversely impact Comerica's earnings.

•: Management's ability to retain key officers and employees may change.

Comerica's future operating results depend substantially upon the continued service of its executive officers and key personnel. Comerica's future operating results also depend in significant part upon its ability to attract and retain qualified management, financial, technical, marketing, sales and support personnel. Competition for qualified personnel is intense, and Comerica cannot ensure success in attracting or retaining qualified personnel. There may be only a limited number of persons with the requisite skills to serve in these positions, and it may be increasingly difficult for Comerica to hire personnel over time.

Comerica's ability to retain key officers and employees may be further impacted by legislation and regulation affecting the financial services industry. On February 17, 2009, the American Recovery and Reinvestment Act of 2009 (the "ARRA") was signed into law. Section 7001 of the ARRA amended Section 111 of the EESA in its entirety. On June 10, 2009, the U.S. Treasury released an interim final rule (the "IFR"), effective June 15, 2009, that provided guidance on the compensation and governance standards for Troubled Asset Relief Program ("TARP") recipients, and promulgated regulations to implement the restrictions and standards set forth in Section 7001 of the ARRA. Among other things, the IFR and ARRA significantly expanded the executive compensation restrictions previously imposed by the EESA. Such restrictions apply to any entity that has received or will receive financial assistance under the TARP, and shall generally continue to apply for as long as any obligation arising from financial assistance provided under TARP, including preferred stock issued under the Capital Purchase Program, remains outstanding. These ARRA restrictions shall not apply to any TARP recipient during such time when the federal government (i) only holds any warrants to purchase common stock of such recipient or (ii) does not hold any preferred stock or warrants to purchase common stock of such recipient. As a result of our participation in the Capital Purchase Program, the restrictions and standards set forth in Section 7001 of the ARRA, as well as the IFR promulgated by the U.S. Treasury, shall be applicable to Comerica. Such restrictions and standards may further impact management's ability to compete with financial institutions that are not subject to the same limitations as Comerica under Section 7001 of the ARRA and the IFR.

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Comerica's business, financial condition or results of operations could be materially adversely affected by the loss of any of its key employees, or Comerica's inability to attract and retain skilled employees.

•: Legal and regulatory proceedings and related matters with respect to the financial services industry, including those directly involving Comerica and its subsidiaries, could adversely affect Comerica or the financial services industry in general.

Comerica has been, and may in the future be, subject to various legal and regulatory proceedings. It is inherently difficult to assess the outcome of these matters, and there can be no assurance that Comerica will prevail in any proceeding or litigation. Any such matter could result in substantial cost and diversion of Comerica's efforts, which by itself could have a material adverse effect on Comerica's financial condition and operating results. Further, adverse determinations in such matters could result in actions by Comerica's regulators that could materially adversely affect Comerica's business, financial condition or results of operations.

•: Changes in regulation or oversight may have a material adverse impact on Comerica's operations.

Comerica is subject to extensive regulation, supervision and examination by the Texas Department of Banking, the Federal Deposit Insurance Corporation, the Board of Governors of the Federal Reserve System, the Securities and Exchange Commission and other regulatory bodies. Such regulation and supervision governs the activities in which Comerica may engage. Regulatory authorities have extensive discretion in their supervisory and enforcement activities, including the imposition of restrictions on Comerica's operations, investigations and limitations related to Comerica's securities, the classification of Comerica's assets and determination of the level of Comerica's allowance for loan losses. In light of the current conditions in the U.S. financial markets and economy, Congress and regulators have increased their focus on the regulation of the financial services industry. Any change in such regulation and oversight, whether in the form of regulatory policy, regulations, legislation or supervisory action, may have a material adverse impact on Comerica's business, financial condition or results of operations.

•: Methods of reducing risk exposures might not be effective.

Instruments, systems and strategies used to hedge or otherwise manage exposure to various types of credit, market and liquidity, operational, compliance, business risks and enterprise-wide risk could be less effective than anticipated. As a result, Comerica may not be able to effectively mitigate its risk exposures in particular market environments or against particular types of risk, which could have a material adverse impact on Comerica's business, financial condition or results of operations.

•: Terrorist activities or other hostilities may adversely affect the general economy, financial and capital markets, specific industries, and Comerica.

Terrorist attacks or other hostilities may disrupt Comerica's operations or those of its customers. In addition, these events have had and may continue to have an adverse impact on the U.S. and world economy in general and consumer confidence and spending in particular, which could harm Comerica's operations. Any of these events could increase volatility in the U.S. and world financial markets, which could harm Comerica's stock price and may limit the capital resources available to Comerica and its customers. This could have a material adverse impact on Comerica's operating results, revenues and costs and may result in increased volatility in the market price of Comerica's common stock.

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•: Natural disasters, including, but not limited to, hurricanes, tornadoes, earthquakes, fires and floods, may adversely affect the general economy, financial and capital markets, specific industries, and Comerica.

Comerica has significant operations and a significant customer base in California, Texas, Florida and other regions where natural disasters may occur. These regions are known for being vulnerable to natural disasters and other risks, such as tornadoes, hurricanes, earthquakes, fires and floods. These types of natural disasters at times have disrupted the local economy, Comerica's business and customers and have posed physical risks to Comerica's property. A significant natural disaster could materially adversely affect Comerica's operating results.

Item 1B. Unresolved Staff Comments.

None.

Item 2. Properties.

The executive offices of Comerica are located in the Comerica Bank Tower, 1717 Main Street, Dallas, Texas 75201. Comerica Bank leases five floors of the building, plus an additional 34,238 square feet on the building's lower level, from an unaffiliated third party. The lease for such space used by Comerica and its subsidiaries extends through September 2023. Comerica and its subsidiaries also currently occupy 11 floors in the Comerica Tower at One Detroit Center, 500 Woodward Avenue, Detroit, Michigan 48226. Such space is leased through Comerica Bank from an unaffiliated third party. The leases at that building extend through January 2012. As of December 31, 2009, Comerica, through its banking affiliates, operated a total of 517 banking centers, trust services locations, and loan production or other financial services offices, primarily in the States of Texas, Michigan, California, Florida and Arizona. Of these offices, 218 were owned and 299 were leased. As of December 31, 2009, affiliates also operated from leased spaces in Denver, Colorado; Wilmington, Delaware; Oakbrook Terrace, Illinois; Boston and Waltham, Massachusetts; Minneapolis, Minnesota; Princeton and Sea Girt, New Jersey; Las Vegas, Nevada; New York, New York; Rocky Mount and Wilmington, North Carolina; Granville and West Chester, Ohio; Memphis, Tennessee; Reston, Virginia; Bellevue and Seattle, Washington; Monterrey, Mexico; Toronto, Ontario, Canada and Windsor, Ontario, Canada. Comerica and its subsidiaries own, among other properties, a check processing center in Livonia, Michigan, a 10-story building in the central business district of Detroit, Michigan that houses certain departments of Comerica and Comerica Bank, and three buildings in Auburn Hills, Michigan, used mainly for lending functions and operations.

Item 3. Legal Proceedings.

Comerica and certain of its subsidiaries are subject to various pending and threatened legal proceedings arising out of the normal course of business or operations. In view of the inherent difficulty of predicting the outcome of such matters, Comerica cannot state what the eventual outcome of any such matters will be. However, based on current knowledge and after consultation with legal counsel, management believes that current reserves, determined in accordance with SFAS No. 5, "Accounting for Contingencies," are adequate and the amount of any incremental liability arising from these matters is not expected to have a material adverse effect on Comerica's consolidated financial condition.

Item 4. Submission of Matters to a Vote of Security Holders.

Comerica did not submit any matters for a vote of the security holders in the fourth quarter of 2009.

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PART II

Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.

Market Information and Holders of Common Stock

The common stock of Comerica Incorporated is traded on the New York Stock Exchange (NYSE Trading Symbol: CMA). At February 22, 2010, there were approximately 12,678 record holders of Comerica's common stock.

Sales Prices and Dividends

Quarterly cash dividends were declared during 2009 and 2008 totaling $0.20 and $2.31 per common share per year, respectively. The following table sets forth, for the periods indicated, the high and low sale prices per share of Comerica's common stock as reported on the NYSE Composite Transactions Tape for all quarters of 2009 and 2008, as well as dividend information.

Quarter	High		Low		Dividends Per Share

2009
Fourth	$	32.30	$	26.49	$	0.05	0.7	%
Third		31.83		19.94		0.05	0.8
Second		26.47		16.03		0.05	0.9
First		21.20		11.72		0.05	1.2
2008
Fourth	$	37.01	$	15.05	$	0.33	5.1	%
Third		43.99		19.31		0.66	8.3
Second		40.62		25.61		0.66	8.0
First		45.19		34.51		0.66	6.6

*: 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.

Effective November 14, 2008, Comerica cannot, without the consent of the U.S. Treasury, increase its quarterly dividend above $0.33 per common share under the terms of the Capital Purchase Program. For additional information regarding Comerica's participation in the Capital Purchase Program, please refer to pages 8 and 9 of this Annual Report on Form 10-K.

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Securities Authorized for Issuance Under Equity Compensation Plans

As of December 31, 2009

Plan Category			Weighted-average exercise price of outstanding options, warrants and rights (b)

Equity compensation plans approved by security holders(1)		18,289,697	$	49.48	6,957,425	(2)(3)
Equity compensation plans not approved by security holders(4)		132,500		53.87	—

	Total	18,422,197	$	49.52	6,957,425

(1): Consists of options to acquire shares of common stock, par value $5.00 per share, issued under the Comerica Incorporated Amended and Restated 2006 Long-Term Incentive Plan, Amended and Restated 1997 Long-Term Incentive Plan, the 1991 Long-Term Incentive Plan, the Amended and Restated Comerica Incorporated Stock Option Plan for Non-Employee Directors, and the Imperial Bank Stock Option Plan (assumed by Comerica in connection with its acquisition of Imperial Bank). Does not include 80,867 restricted stock units equivalent to shares of common stock issued under the Comerica Incorporated Amended and Restated Incentive Plan for Non-Employee Directors and outstanding as of December 31, 2009, or 2,089,326 shares of restricted stock issued under Comerica's Amended and Restated 2006 Long-Term Incentive Plan and outstanding as of December 31, 2009. There are no shares available for future issuances under any of these plans other than the Comerica Incorporated Incentive Plan for Non-Employee Directors and Comerica's Amended and Restated 2006 Long-Term Incentive Plan. The Comerica Incorporated Incentive Plan for Non-Employee Directors was approved by the shareholders on May 18, 2004. The 2006 Long-Term Incentive Plan (currently known as the Amended and Restated 2006 Long-Term Incentive Plan) was approved by Comerica's shareholders on May 16, 2006.
(2): Does not include shares of common stock purchased by employees under the Amended and Restated Employee Stock Purchase Plan, or contributed by Comerica on behalf of the employees. The Amended and Restated Employee Stock Purchase Plan was ratified and approved by the shareholders on May 18, 2004. Five million shares of Comerica's common stock have been registered for sale or awards to employees under the Amended and Restated Employee Stock Purchase Plan. As of December 31, 2009, 1,735,041 shares had been purchased by or contributed on behalf of employees, leaving 3,264,959 shares available for future sale or awards. If these shares available for future sale or awards under the Employee Stock Purchase Plan were included, the number shown in column (c) would be 10,222,384.
(3): These shares are available for future issuance under Comerica's Amended and Restated 2006 Long-Term Incentive Plan in the form of options, stock appreciation rights, restricted stock, restricted stock units, performance awards and other stock-based awards and under the Incentive Plan for Non-Employee Directors in the form of options, stock appreciation rights, restricted stock, restricted stock units and other equity-based awards. Under the Amended and Restated 2006 Long-Term Incentive Plan, not more than a total of 2.2 million shares may be used for awards other than options and stock appreciation rights and not more than one million shares are available as incentive stock options. Further, no award recipient may receive more than 350,000 shares during any calendar year, and the maximum number of shares underlying awards of options

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and stock appreciation rights that may be granted to an award recipient in any calendar year is 350,000.

(4): Consists of options to acquire shares of common stock, par value $5.00 per share, issued under the Amended and Restated Comerica Incorporated Stock Option Plan for Non-Employee Directors of Comerica Bank and Affiliated Banks (terminated March 2004).

Most of the equity awards made by Comerica during 2009 were granted under the shareholder-approved Amended and Restated 2006 Long-Term Incentive Plan.

Plans not approved by Comerica's shareholders include:

Amended and Restated Comerica Incorporated Stock Option Plan for Non-Employee Directors of Comerica Bank and Affiliated Banks (Terminated March 2004) —Under the plan, Comerica granted options to acquire up to 450,000 shares of common stock, subject to equitable adjustment upon the occurrence of events such as stock splits, stock dividends or recapitalizations. After each annual meeting of shareholders, each member of the Board of Directors of a subsidiary bank of Comerica who was not an employee of Comerica or of any of its subsidiaries nor a director of Comerica (the "Eligible Directors") automatically was granted an option to purchase 2,500 shares of the common stock of Comerica. Option grants under the plan were in addition to annual retainers, meeting fees and other compensation payable to Eligible Directors in connection with their services as directors. The plan is administered by a committee of the Board of Directors. With respect to the automatic grants, the committee does not and did not have discretion as to matters such as the selection of directors to whom options will be granted, the timing of grants, the number of shares to become subject to each option grant, the exercise price of options, or the periods of time during which any option may be exercised. In addition to the automatic grants, the committee could grant options to the Eligible Directors in its discretion. The exercise price of each option granted was the fair market value of each share of common stock subject to the option on the date the option was granted. The exercise price is payable in full upon exercise of the option and may be paid in cash or by delivery of previously owned shares. The committee may change the option price per share following a corporate reorganization or recapitalization so that the aggregate option price for all shares subject to each outstanding option prior to the change is equivalent to the aggregate option price for all shares or other securities into which option shares have been converted or which have been substituted for option shares. The term of each option cannot be more than ten years. This plan was terminated by the Board of Directors on March 23, 2004. Accordingly, no new options may be granted under this plan.

Director Deferred Compensation Plans —Comerica maintains two deferred compensation plans for non-employee directors of Comerica, its subsidiaries and its advisory boards: the Amended and Restated Comerica Incorporated Common Stock Non-Employee Director Fee Deferral Plan (the "Common Stock Deferral Plan") and the Amended and Restated Comerica Incorporated Non-Employee Director Fee Deferral Plan (the "Mutual Fund Deferral Plan"). The Common Stock Deferral Plan allows directors to invest in units that correlate to, and are functionally equivalent to, shares of common stock of Comerica, while the Mutual Fund Deferral Plan allows directors to invest in units that correlate to, and are functionally equivalent to, the shares of certain mutual funds offered under such plan. The Common Stock Deferral Plan previously provided for the mandatory deferral of 50% of the annual retainer of each director of Comerica into shares of common stock of Comerica, but currently has no mandatory deferral. Until the mandatory deferral requirement was discontinued, directors could voluntarily defer the remaining 50% of their director fees (and all other non-employee directors of Comerica's subsidiaries could choose to defer up to 100% of their director fees) under the Common Stock Deferral Plan or the Mutual Fund Deferral Plan, or a combination of the two plans. Currently, all eligible non-employee directors may defer any portion or none of their director fees under the Common Stock Deferral Plan or the Mutual Fund Deferral Plan, or a combination of the two plans.

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The directors' accounts under the Common Stock Deferral Plan are increased to the extent of dividends paid on Comerica common stock to reflect the number of additional shares of Comerica's common stock that could have been purchased had the dividends been paid on each share of common stock hypothetically underlying then-outstanding stock units in the directors' accounts. Similarly, the directors' accounts under the Mutual Fund Deferral Plan are increased in connection with the payment of dividends paid on the mutual fund shares to reflect the number of additional shares of mutual fund shares that could have been purchased had the dividends or other distributions been paid on each share of stock hypothetically underlying then-outstanding mutual fund units in the directors' accounts. Following the applicable deferral period, the distribution of a participant's Comerica stock unit account under the Common Stock Deferral Plan is made in Comerica's common stock (with fractional shares being paid in cash), while the distribution of a participant's mutual fund account under the Mutual Fund Deferral Plan is made in cash.

Employee Deferred Compensation Plans —Comerica maintains two deferred compensation plans for eligible employees of Comerica and its subsidiaries: the 1999 Comerica Incorporated Amended and Restated Common Stock Deferred Incentive Award Plan (the "Employee Common Stock Deferral Plan") and the 1999 Comerica Incorporated Deferred Compensation Plan (the "Employee Fund Plan"). Under the Employee Common Stock Deferral Plan, eligible employees may defer specified portions of their incentive awards into units that correlate to, and are functionally equivalent to, shares of common stock of Comerica. The employees' accounts under the Employee Common Stock Deferral Plan are increased in connection with the payment of dividends paid on Comerica's common stock to reflect the number of additional shares of Comerica's common stock that could have been purchased had the dividends been paid on each share of common stock hypothetically underlying then-outstanding stock units in the employees' accounts. The deferred compensation under the Employee Common Stock Deferral Plan is payable in shares of Comerica's common stock following termination of service as an employee.

Similarly, under the Employee Fund Plan, eligible employees may defer specified portions of their compensation, including salary, bonus and incentive awards, into units that correlate to, and are functionally equivalent to, shares of certain mutual funds offered under the Employee Fund Plan. Beginning in 1999, no such funds are Comerica stock funds. The employees' accounts under the Employee Fund Plan are increased in connection with the payment of dividends paid on the fund shares to reflect the number of additional shares of the fund stock that could have been purchased had the dividends been paid on each share of fund stock hypothetically underlying then-outstanding stock units in the employees' accounts. The deferred compensation under the Employee Fund Plan is payable in cash following termination of service as an employee.

For additional information regarding Comerica's equity compensation plans, please refer to Note 18 on pages 120 through 122 of the Consolidated Financial Statements contained in Comerica's Annual Report to Shareholders for the year ended December 31, 2009.

Purchases of Equity Securities by the Issuer and Affiliated Purchasers

The Board of Directors of Comerica authorized the purchase of up to 10 million shares on November 13, 2007, in addition to the remaining unfulfilled portion of the November 14, 2006 authorization. Substantially all shares purchased as part of Comerica's publicly announced repurchase program have been transacted in the open market and were within the scope of Rule 10b-18, which provides a safe harbor for purchases in a given day if an issuer of equity securities satisfies the manner, timing, price and volume conditions of the rule when purchasing its own common shares in the open market. There is no expiration date for Comerica's share repurchase program. However, as a participant in the Capital Purchase Program, effective November 14, 2008, Comerica cannot repurchase any of its shares without U.S. Treasury approval with limited exceptions, most significantly purchases in connection with benefit plans. Comerica made no open market repurchases in the years ended

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December 31, 2009 and December 31, 2008, as compared to the year ended December 31, 2007 during which it repurchased 10.0 million shares in the open market. The following table summarizes Comerica's monthly share repurchase activity during the quarter ended December 31, 2009.

Month Ended			Average Price Paid Per Share

October 31, 2009		672	$	28.55	—	12,576,281
November 30, 2009		597		27.91	—	12,576,281
December 31, 2009		—		—	—	12,576,281

	Total	1,269	$	28.25	—	12,576,281

(1): Includes shares purchased pursuant to deferred compensation plans and shares purchased from employees to pay for grant prices and/or taxes related to stock option exercises and restricted stock vesting under the terms of an employee share-based compensation plan.

For additional information regarding Comerica's share repurchase program, please refer to Note 15 on pages 116 through 118 of the Consolidated Financial Statements contained in Comerica's Annual Report to Shareholders for the year ended December 31, 2009.

Unregistered Sales of Equity Securities and Use of Proceeds

Pursuant to the U.S. Treasury's Capital Purchase Program, on November 14, 2008, Comerica issued to the U.S. Treasury in exchange for aggregate consideration of $2.25 billion, (i) 2.25 million shares of Comerica's Fixed Rate Cumulative Perpetual Preferred Stock, Series F, without par value (the "Series F Preferred Stock"), and (ii) a warrant to purchase 11,479,592 shares of Comerica's common stock, at an exercise price of $29.40 per share, subject to certain anti-dilution and other adjustments (the "Warrant"). The Series F Preferred Stock (a) has a liquidation amount per share equal to $1,000 for an aggregate value of $2.25 billion and (b) pays a cumulative annual dividend of five percent for the first five years and nine percent on an annual basis thereafter. The Warrant expires ten years from the issuance date. Both the Series F Preferred Stock and the Warrant were accounted for as components of Comerica's regulatory Tier 1 capital.

For additional information regarding Comerica's participation in the Capital Purchase Program, please refer to (i) pages 8 and 9 of this Annual Report on Form 10-K and (ii) Note 15 on pages 116 through 118 of the Consolidated Financial Statements contained in Comerica's Annual Report to Shareholders for the year ended December 31, 2009.

Item 6. Selected Financial Data.

The response to this item is included on page 11 of Comerica's Annual Report to Shareholders for the year ended December 31, 2009, which page is hereby incorporated by reference.

Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations.

The response to this item is included on pages 12 through 68 of Comerica's Annual Report to Shareholders for the year ended December 31, 2009, which pages are hereby incorporated by reference.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk.

The response to this item is included on pages 52 through 59 of Comerica's Annual Report to Shareholders for the year ended December 31, 2009, which pages are hereby incorporated by reference.

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Item 8. Financial Statements and Supplementary Data.

The response to this item is included on pages 69 through 155 of Comerica's Annual Report to Shareholders for the year ended December 31, 2009, and in the Statistical Disclosure by Bank Holding Companies on pages 15 through 55 and 97 through 109 and pages 112 and 113 of Comerica's Annual Report to Shareholders for the year ended December 31, 2009, which pages are hereby incorporated by reference.

Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.

None.

Item 9A. Controls and Procedures.

Disclosure Controls and Procedures

As required by Rule 13a-15(b) of the Exchange Act, management, including the Chief Executive Officer and Chief Financial Officer, conducted an evaluation as of the end of the period covered by this Annual Report on Form 10-K, of the effectiveness of our disclosure controls and procedures as defined in Exchange Act Rule 13a-15(e). Based on that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that Comerica's disclosure controls and procedures were effective as of the end of the period covered by this Annual Report on Form 10-K.

Internal Control Over Financial Reporting

Management's annual report on internal control over financial reporting and the related attestation report of Comerica's registered public accounting firm are included on pages 150 and 151 of Comerica's Annual Report to Shareholders for the year ended December 31, 2009, which pages are hereby incorporated by reference.

As required by Rule 13a-15(d), management, including the Chief Executive Officer and Chief Financial Officer, conducted an evaluation of our internal control over financial reporting to determine whether any changes occurred during the period covered by this Annual Report on Form 10-K that have materially affected, or are reasonably likely to materially affect, Comerica's internal control over financial reporting. Based on that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that there has been no such change during the last quarter of the fiscal year covered by this Annual Report on Form 10-K that has materially affected, or is reasonably likely to materially affect, Comerica's internal control over financial reporting.

Item 9B. Other Information.

None.

PART III

Item 10. Directors and Executive Officers of the Registrant.

Comerica has a Senior Financial Officer Code of Ethics that applies to the Chief Executive Officer, the Chief Financial Officer, the Controller, the Executive Vice President—Finance, and the Treasurer of Comerica. The Senior Financial Officer Code of Ethics is available on Comerica's website at www.comerica.com.

The remainder of the response to this item will be included under the sections captioned "Information About Nominees and Incumbent Directors," "Committees and Meetings of Directors," "Committee Assignments," "Executive Officers" and "Section 16(a) Beneficial Ownership Reporting

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Compliance" of Comerica's definitive Proxy Statement relating to the Annual Meeting of Shareholders to be held on April 27, 2010, which sections are hereby incorporated by reference.

Item 11. Executive Compensation.

The response to this item will be included under the sections captioned "Compensation Committee Interlocks and Insider Participation", "Compensation of Executive Officers", "Compensation Discussion and Analysis", "Compensation of Directors", "Officer Stock Ownership Guidelines", "Governance, Compensation and Nominating Committee Report", "2009 Summary Compensation Table", "2009 Grants Of Plan-Based Awards", "Outstanding Equity Awards At Fiscal Year-End 2009", "2009 Option Exercises and Stock Vested", "Pension Benefits at Fiscal Year-End 2009", "2009 Nonqualified Deferred Compensation", and "Potential Payments Upon Termination or Change in Control at Fiscal Year-End 2009" of Comerica's definitive Proxy Statement relating to the Annual Meeting of Shareholders to be held on April 27, 2010, which sections are hereby incorporated by reference.

Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.

The information called for by this item with respect to securities authorized for issuance under equity compensation plans is included under Part II, Item 5 of this Annual Report on Form 10-K.

The response to the remaining requirements of this item will be included under the sections captioned "Security Ownership of Certain Beneficial Owners" and "Security Ownership of Management" of Comerica's definitive Proxy Statement relating to the Annual Meeting of Shareholders to be held on April 27, 2010, which sections are hereby incorporated by reference.

Item 13. Certain Relationships and Related Transactions, and Director Independence.

The response to this item will be included under the sections captioned "Director Independence and Transactions of Directors with Comerica," "Transactions of Executive Officers with Comerica" and "Information about Nominees and Incumbent Directors" of Comerica's definitive Proxy Statement relating to the Annual Meeting of Shareholders to be held on April 27, 2010, which sections are hereby incorporated by reference.

Item 14. Principal Accountant Fees and Services.

The response to this item will be included under the section captioned "Independent Auditors" of Comerica's definitive Proxy Statement relating to the Annual Meeting of Shareholders to be held on April 27, 2010, which section is hereby incorporated by reference.

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Comerica Incorporated and Subsidiaries
FORM 10-K CROSS-REFERENCE INDEX




Certain information required to be included in this Form 10-K is included in the 2009 Annual Report to Shareholders or in the 2010 Proxy Statement used in connection with the 2010 Annual Meeting of Shareholders to be held on April 27, 2010.	The following cross-reference index shows the page location in the 2009 Annual Report to Shareholders or the section of the 2010 Proxy Statement of only that information which is to be incorporated by reference into this Form 10-K.	All other sections of the 2009 Annual Report to Shareholders or the 2010 Proxy Statement are not required in this Form 10-K and are not to be considered a part of this Form 10-K.

		Page Number of 2009 Annual Report to Shareholders or Section of 2010 Proxy Statement

	PART I
ITEM 1.	Business	Included herein; 15; 17-21; 25-29; 35-27; 39-41; 114-118; 138-143
ITEM 1A.	Risk Factors	Included herein
ITEM 1B.	Unresolved Staff Comments	Included herein
ITEM 2.	Properties	Included herein
ITEM 3.	Legal Proceedings	Included herein
ITEM 4.	Submission of Matters to a Vote of Security Holders	Included herein
	PART II
ITEM 5.	Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	Included herein; 116-118; 120-122
	Performance Graph	10
ITEM 6.	Selected Financial Data	11
ITEM 7.	Management's Discussion and Analysis of Financial Condition and Results of Operations	12-68
ITEM 7A.	Quantitative and Qualitative Disclosures About Market Risk	52-59
ITEM 8.	Financial Statements and Supplementary Data:	15-55; 69-155
	Comerica Incorporated and Subsidiaries
	Consolidated Balance Sheets	69
	Consolidated Statements of Income	70
	Consolidated Statements of Changes in Shareholders' Equity	71
	Consolidated Statements of Cash Flows	72
	Notes to Consolidated Financial Statements	73-149
	Report of Management	150
	Report of Independent Registered Public Accounting Firm	152
	Management's Report on Internal Control Over Financial Reporting	150
	Attestation Report of Independent Registered Public Accounting Firm	151
	Statistical Disclosure by Bank Holding Companies:
	Analysis of Net Interest Income—Fully Taxable Equivalent	15
	Rate-Volume Analysis—Fully Taxable Equivalent	16
	Analysis of Investment Securities and Loans	30
	Analysis of Investment Securities Portfolio—Fully Taxable Equivalent	33
	International Cross-Border Outstandings	35
	Analysis of the Allowance for Loan Losses	39
	Allocation of the Allowance for Loan Losses	41
	Summary of Nonperforming Assets and Past Due Loans	42; 97-99
	Concentration of Credit	47
	Loan Maturities and Interest Rate Sensitivity	54
	Risk Management Derivative Instruments	54; 102-109
	Customer-Initiated and Other Derivative Instruments	55; 102-109
	Deposits—Maturity Distribution of Domestic Certificates of Deposit of $100,000 and Over	112
	Short-Term Borrowings	113

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		Page Number of 2009 Annual Report to Shareholders or Section of 2010 Proxy Statement

ITEM 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	Included herein
ITEM 9A.	Controls and Procedures:
	Management's Report on Internal Control Over Financial Reporting	150
	Attestation Report of Independent Registered Public Accounting Firm	151
	Other information called for by this item	Included herein
ITEM 9B.	Other Information	Included herein
	PART III
ITEM 10.	Directors and Executive Officers of the Registrant:	Included herein
	Information about Senior Financial Officer Code of Ethics
	Other information called for by this item	Information About Nominees and Incumbent Directors, Committees and Meetings of Directors, Committee Assignments, Executive Officers, and Section 16(a) Beneficial Ownership Reporting Compliance
ITEM 11.	Executive Compensation	Compensation Committee Interlocks and Insider Participation, Compensation of Executive Officers, Compensation Discussion and Analysis, Compensation of Directors, Officer Stock Ownership Guidelines, Governance, Compensation and Nominating Committee Report, 2009 Summary Compensation Table, 2009 Grants Of Plan-Based Awards, Outstanding Equity Awards At Fiscal Year-End 2009, 2009 Option Exercises and Stock Vested, Pension Benefits at Fiscal Year-End 2009, 2009 Non-Qualified Deferred Compensation, and Potential Payments Upon Termination or Change in Control at Fiscal Year-End 2009
ITEM 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters:
	Information about Securities Authorized for Issuance Under Equity Compensation Plans	Included herein
	Other information called for by this item	Security Ownership of Certain Beneficial Owners and Security Ownership of Management

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		Page Number of 2009 Annual Report to Shareholders or Section of 2010 Proxy Statement

ITEM 13.	Certain Relationships and Related Transactions, and Director Independence	Director Independence and Transactions of Directors with Comerica, Transactions of Executive Officers with Comerica, and Information about Nominees and Incumbent Directors
ITEM 14.	Principal Accountant Fees and Services	Independent Auditors

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PART IV

Item 15. Exhibits and Financial Statement Schedules

The following documents are filed as a part of this report:

1.: Financial Statements: The financial statements that are filed as part of this report are listed under Item 8 in the Form 10-K Cross-Reference Index on pages 27-29.
2.: All of the schedules for which provision is made in the applicable accounting regulations of the Securities and Exchange Commission are either not required under the related instruction, the required information is contained elsewhere in the Form 10-K, or the schedules are inapplicable and therefore have been omitted.
3.: Exhibits:


2		(not applicable)
3.1(a)		Restated Certificate of Incorporation of Comerica Incorporated (as amended) (filed as Exhibit 3.1 to Registrant's Annual Report on Form 10-K for the year ended December 31, 1996, and incorporated herein by reference).
3.1(b)		Certificate of Amendment to Restated Certificate of Incorporation of Comerica Incorporated (filed as Exhibit 3.2 to Registrant's Registration Statement on Form S-4, filed December 1, 2000, File No. 333-51042, and incorporated herein by reference).
3.1(c)		Certificate of Designations for Series F Preferred Stock (filed as Exhibit 3.1 to Registrant's Current Report on From 8-K dated November 13, 2008, regarding U.S. Department of Treasury's Capital Purchase Program, and incorporated herein by reference).
3.2		Amended and Restated Bylaws of Comerica Incorporated (amended and restated May 20, 2008) (filed as Exhibit 3.1 to Registrant's Current Report on Form 8-K dated May 20, 2008, regarding the Registrant's Bylaws, and incorporated herein by reference).
4		[Reference is made to Exhibits 3.1(a), 3.1(b), 3.1(c) and 3.2 in respect of instruments defining the rights of security holders. In accordance with Regulation S-K Item No. 601(b)(4)(iii), the Registrant is not filing copies of instruments defining the rights of holders of long-term debt because none of those instruments authorizes debt in excess of 10% of the total assets of the registrant and its subsidiaries on a consolidated basis. The Registrant hereby agrees to furnish a copy of any such instrument to the Securities and Exchange Commission upon request.]
4.1		Form of Certificate for Series F Preferred Stock (filed as Exhibit 4.1 to Registrant's Current Report on From 8-K dated November 13, 2008, regarding U.S. Department of Treasury's Capital Purchase Program, and incorporated herein by reference).
4.2		Form of Warrant for Purchase of Common Stock (filed as Exhibit 4.2 to Registrant's Current Report on From 8-K dated November 13, 2008, regarding U.S. Department of Treasury's Capital Purchase Program, and incorporated herein by reference).
9		(not applicable)
10.1†		Comerica Incorporated 2006 Amended and Restated Long-Term Incentive Plan (amended and restated November 18, 2008, with amendments effective December 31, 2008)(filed as Exhibit 10.1 to Registrant's Annual Report on Form 10-K for the year ended December 31, 2008, and incorporated herein by reference).

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10.2†		Comerica Incorporated 2006 Amended and Restated Management Incentive Plan (amended and restated November 18, 2008, with amendments effective December 31, 2008)(filed as Exhibit 10.2 to Registrant's Annual Report on Form 10-K for the year ended December 31, 2008, and incorporated herein by reference).
10.3†		Amended and Restated Benefit Equalization Plan for Employees of Comerica Incorporated (amended and restated March 24, 2009, with amendments effective January 1, 2009)(filed as Exhibit 10.1 to Registrant's Current Report on Form 8-K on March 30, 2009, and incorporated herein by reference).
10.4†		Comerica Incorporated Amended and Restated Employee Stock Purchase Plan (amended and restated November 18, 2008, with amendments effective December 31, 2008)(filed as Exhibit 10.4 to Registrant's Annual Report on Form 10-K for the year ended December 31, 2008, and incorporated herein by reference).
10.5†		1986 Stock Option Plan of Imperial Bancorp (as amended) (filed as Exhibit 10.23 to Registrant's Annual Report on Form 10-K for the year ended December 31, 2001, and incorporated herein by reference).
10.6†		Form of Standard Comerica Incorporated Non-Qualified Stock Option Agreement under the Amended and Restated Comerica Incorporated 1997 Long-Term Incentive Plan (filed as Exhibit 10.4 to Registrant's Quarterly Report on Form 10-Q for the quarter ended September 30, 2004, and incorporated herein by reference).
10.7†		Form of Standard Comerica Incorporated Non-Qualified Stock Option Agreement under the Comerica Incorporated Amended and Restated 2006 Long-Term Incentive Plan (filed as Exhibit 10.7 to Registrant's Annual Report on Form 10-K for the year ended December 31, 2006, and incorporated herein by reference).
10.8†		Form of Standard Comerica Incorporated Restricted Stock Award Agreement (cliff vesting) under the Comerica Incorporated 1997 Amended and Restated Long-Term Incentive Plan (filed as Exhibit 10.2 to Registrant's Quarterly Report on Form 10-Q for the quarter ended September 30, 2004, and incorporated herein by reference).
10.9†		Form of Standard Comerica Incorporated Restricted Stock Award Agreement (cliff vesting) under the Comerica Incorporated 2006 Amended and Restated Long-Term Incentive Plan (filed as Exhibit 99.1 to Registrant's Current Report on Form 8-K dated January 22, 2007, and incorporated herein by reference).
10.10†		Form of Standard Comerica Incorporated Restricted Stock Award Agreement (non-cliff vesting) under the Amended and Restated Comerica Incorporated 1997 Long-Term Incentive Plan (filed as Exhibit 10.3 to Registrant's Quarterly Report on Form 10-Q for the quarter ended September 30, 2004, and incorporated herein by reference).
10.11†		Form of Standard Comerica Incorporated Restricted Stock Award Agreement (non-cliff vesting) under the Amended and Restated Comerica Incorporated 2006 Long-Term Incentive Plan (filed as Exhibit 10.11 to Registrant's Annual Report on Form 10-K for the year ended December 31, 2006, and incorporated herein by reference).
10.12†		Form of Standard Comerica Incorporated No Sale Agreement under the Comerica Incorporated Amended and Restated Management Incentive Plan (filed as Exhibit 10.5 to Registrant's Quarterly Report on Form 10-Q for the quarter ended September 30, 2004, and incorporated herein by reference).

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10.13†		Form of Director Indemnification Agreement between Comerica Incorporated and certain of its directors (filed as Exhibit 10.6 to Registrant's Annual Report on Form 10-K for the year ended December 31, 2002, and incorporated herein by reference).
10.14†		Supplemental Benefit Agreement with Eugene A. Miller (filed as Exhibit 10.1 to Registrant's Quarterly Report on Form 10-Q for the quarter ended September 30, 2002, and incorporated herein by reference).
10.15†		Supplemental Pension and Retiree Medical Agreement with Ralph W. Babb Jr. (filed as Exhibit 10.2 to Registrant's Quarterly Report on Form 10-Q for the quarter ended June 30, 1998, and incorporated herein by reference).
10.16†		Restrictive Covenants and General Release Agreement by and between John D. Lewis and Comerica Incorporated dated March 13, 2006 (filed as Exhibit 10.1 to Registrant's Quarterly Report on Form 10-Q for the quarter ended June 30, 2006, and incorporated herein by reference).
10.17†		Restrictive Covenants and General Release Agreement by and between Dennis J. Mooradian and Comerica Incorporated dated February 20, 2009 (filed as Exhibit 10.1 to Registrant's Current Report on Form 8-K on February 25, 2009, and incorporated herein by reference).
10.18†		1999 Comerica Incorporated Amended and Restated Deferred Compensation Plan (amended and restated on November 18, 2008, with amendments effective December 31, 2008)(filed as Exhibit 10.18 to Registrant's Annual Report on Form 10-K for the year ended December 31, 2008, and incorporated herein by reference).
10.19†		1999 Comerica Incorporated Amended and Restated Common Stock Deferred Incentive Award Plan (amended and restated on November 18, 2008, with amendments effective December 31, 2008)(filed as Exhibit 10.19 to Registrant's Annual Report on Form 10-K for the year ended December 31, 2008, and incorporated herein by reference).
10.20†		Amended and Restated Comerica Incorporated Stock Option Plan For Non-Employee Directors (amended and restated May 22, 2001)(filed as Exhibit 10.12 to Registrant's Annual Report on Form 10-K for the year ended December 31, 2002, and incorporated herein by reference).
10.21†		Amended and Restated Comerica Incorporated Stock Option Plan For Non-Employee Directors of Comerica Bank and Affiliated Banks (amended and restated May 22, 2001)(filed as Exhibit 10.13 to Registrant's Annual Report on Form 10-K for the year ended December 31, 2002, and incorporated herein by reference).
10.22†		Amended and Restated Comerica Incorporated Non-Employee Director Fee Deferral Plan (amended and restated on November 18, 2008, with amendments effective December 31, 2008)(filed as Exhibit 10.22 to Registrant's Annual Report on Form 10-K for the year ended December 31, 2008, and incorporated herein by reference).
10.23†		Amended and Restated Comerica Incorporated Common Stock Non-Employee Director Fee Deferral Plan (amended and restated on November 18, 2008, with amendments effective December 31, 2008)(filed as Exhibit 10.23 to Registrant's Annual Report on Form 10-K for the year ended December 31, 2008, and incorporated herein by reference).
10.24†		Comerica Incorporated Amended and Restated Incentive Plan for Non-Employee Directors (amended and restated on November 18, 2008, with amendments effective December 31, 2008)(filed as Exhibit 10.24 to Registrant's Annual Report on Form 10-K for the year ended December 31, 2008, and incorporated herein by reference).

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10.25†		Form of Standard Comerica Incorporated Non-Employee Director Restricted Stock Unit Agreement under the Comerica Incorporated Amended and Restated Incentive Plan for Non-Employee Directors (filed as Exhibit 10.2 to Registrant's Quarterly Report on Form 10-Q for the quarter ended June 30, 2005, and incorporated herein by reference).
10.26†		Form of Standard Comerica Incorporated Non-Employee Director Restricted Stock Unit Agreement under the Comerica Incorporated Amended and Restated Incentive Plan for Non-Employee Directors (Version 2) (filed as Exhibit 10.6 to Registrant's Quarterly Report on Form 10-Q for the quarter ended June 30, 2006, and incorporated herein by reference).
10.27†		Form of Change of Control Employment Agreement (BE4 and Higher Version) (filed as Exhibit 10.1 to Registrant's Current Report on Form 8-K dated November 18, 2008, and incorporated herein by reference).
10.28†		Schedule of Named Executive Officers Party to Change of Control Employment Agreement (BE4 and Higher Version)
10.29†		Form of Change of Control Employment Agreement (BE2—BE3 Version) (filed as Exhibit 10.2 to Registrant's Current Report on Form 8-K dated November 18, 2008, and incorporated herein by reference).
10.30†		Waiver of Senior Executive Officers dated November 14, 2008 (filed as Exhibit 10.2 to Registrant's Current Report on Form 8-K dated November 13, 2008, regarding U.S. Department of Treasury's Capital Purchase Program, and incorporated herein by reference).
10.31†		Amendments to Benefit Plans and Related Consent of Senior Executive Officers dated November 14, 2008 (filed as Exhibit 10.3 to Registrant's Current Report on Form 8-K dated November 13, 2008, regarding U.S. Department of Treasury's Capital Purchase Program, and incorporated herein by reference).
10.32		Letter Agreement dated November 14, 2008 by and between the Registrant and the United States Department of the Treasury (filed as Exhibit 10.1 to Registrant's Current Report on From 8-K dated November 13, 2008, regarding U.S. Department of Treasury's Capital Purchase Program, and incorporated herein by reference).
10.33		Settlement Agreement dated as of November 3, 2006 and enforceable as of November 10, 2006 (filed as Exhibit 10.34 to Registrant's Annual Report on Form 10-K for the year ended December 31, 2006, and incorporated herein by reference).
10.34		Implementation Agreement dated July 28, 2005 between Framlington Holdings Limited, Guarantors as named in the Agreement and AXA Investment Managers SA (restated to reflect amendments on September 7, 2005) (filed as Exhibit 10.4 to Registrant's Quarterly Report on Form 10-Q for the quarter ended June 30, 2005, and incorporated herein by reference).
10.35		Second Amendment Agreement dated October 31, 2005 in relation to an Implementation Agreement dated July 28, 2005 (as amended on September 7, 2005) (filed as Exhibit 10.5 to Registrant's Quarterly Report on Form 10-Q for the quarter ended September 30, 2005, and incorporated herein by reference).
10.36		Cash Offer dated July 27, 2005 by AXA Investment Managers S.A. (filed as Exhibit 10.6 to Registrant's Quarterly Report on Form 10-Q for the quarter ended September 30, 2005, and incorporated herein by reference).

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10.37		Form of Acceptance relating to the Cash Offer by AXA Investment Managers S.A. for the Entire Issued Share Capital of Framlington Group Limited (filed as Exhibit 10.7 to Registrant's Quarterly Report on Form 10-Q for the quarter ended September 30, 2005, and incorporated herein by reference).
10.38		FINRA Settlement Term Sheet, dated September 16, 2008 (filed as Exhibit 10.1 to Registrant's Quarterly Report on Form 10-Q for the quarter ended September 30, 2008 and incorporated herein by reference).
10.39		FINRA Letter of Acceptance, Waiver and Consent, effective January 5, 2009 (regarding settlement of auction rate securities investigation)(filed as Exhibit 10.39 to Registrant's Annual Report on Form 10-K for the year ended December 31, 2008, and incorporated herein by reference).
10.40†		Form of Agreement Regarding Portion of Salary Payable in Phantom Stock Units (filed as Exhibit 10.1 to Registrant's Current Report on Form 8-K dated January 26, 2010, and incorporated herein by reference).
10.41†		Form of Standard Comerica Incorporated Restricted Stock Award Agreement (cliff vesting) under the Comerica Incorporated 2006 Amended and Restated Long-Term Incentive Plan (long-term restricted version).
10.42†		Form of Change of Control Employment Agreement (BE4 and Higher Version without gross-up or window period—current)
11		Statement regarding Computation of Net Income Per Common Share (incorporated by reference from Note 17 on pages 119 and 120 of Registrant's 2009 Annual Report to Shareholders attached hereto as Exhibit 13).
12		(not applicable)
13		Incorporated Sections of Registrant's 2009 Annual Report to Shareholders
14		(not applicable)
16		(not applicable)
18		(not applicable)
21		Subsidiaries of Registrant
22		(not applicable)
23		Consent of Ernst & Young LLP
24		(not applicable)
31.1		Chairman, President and CEO Rule 13a-14(a)/15d-14(a) Certification of Periodic Report (pursuant to Section 302 of the Sarbanes-Oxley Act of 2002)
31.2		Executive Vice President and CFO Rule 13a-14(a)/15d-14(a) Certification of Periodic Report (pursuant to Section 302 of the Sarbanes-Oxley Act of 2002)
32		Section 1350 Certification of Periodic Report (pursuant to Section 906 of the Sarbanes-Oxley Act of 2002)
33		(not applicable)
34		(not applicable)
35		(not applicable)
99.1		Certification Pursuant to 31 C.F.R. § 30.15 (Principal Executive Officer)
99.2		Certification Pursuant to 31 C.F.R. § 30.15 (Principal Financial Officer)
100		(not applicable)

†: Management compensation plan.

File No. for all filings under Exchange Act: 1-10706.

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SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized as of February 25, 2010.


		COMERICA INCORPORATED
		By:		/s/ RALPH W. BABB, JR. Ralph W. Babb, Jr. Chairman, President and Chief Executive Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed by the following persons on behalf of the registrant in the capacities indicated as of February 25, 2010.



/s/ RALPH W. BABB, JR. Ralph W. Babb, Jr.		Chairman, President and Chief Executive Officer and Director (Principal Executive Officer)
/s/ ELIZABETH S. ACTON Elizabeth S. Acton		Executive Vice President and Chief Financial Officer (Principal Financial Officer)
/s/ MARVIN J. ELENBAAS Marvin J. Elenbaas		Senior Vice President and Chief Accounting Officer (Principal Accounting Officer)
Lillian Bauder		Director
/s/ JAMES F. CORDES James F. Cordes		Director
/s/ ROGER A. CREGG Roger A. Cregg		Director
/s/ T. KEVIN DENICOLA T. Kevin DeNicola		Director
/s/ JACQUELINE P. KANE Jacqueline P. Kane		Director

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/s/ RICHARD G. LINDNER Richard G. Lindner		Director
/s/ ALFRED A. PIERGALLINI Alfred A. Piergallini		Director
Robert S. Taubman		Director
/s/ REGINALD M. TURNER, JR. Reginald M. Turner, Jr.		Director
/s/ NINA G. VACA Nina G. Vaca		Director
Kenneth L. Way		Director

Exhibit 10.28

Schedule of Named Executive Officers Party to

Change in Control Employment Agreement (BE4 and Higher Version)

(As of December 31, 2009)

Ralph W. Babb, Jr., Chairman, President and Chief Executive Officer (a greement dated as of December 14, 2008)

Elizabeth S. Acton, Executive Vice President and Chief Financial Officer (a greement dated as of December 18, 2008)

Joseph J. Buttigieg, III, Vice Chairman (a greement dated as of December 18, 2008)

Mary Constance Beck, Executive Vice President, Retail Bank (a greement dated as of December 18, 2008)

Curtis C. Farmer, Executive Vice President, Wealth and Institutional Management (a greement dated as of December 18, 2008)

Exhibit 10.41

COMERICA INCORPORATED

RESTRICTED STOCK AWARD AGREEMENT

THIS AGREEMENT (the “Agreement”) between Comerica Incorporated (the “Company”) and NAME (the “Award Recipient”) is effective as of GRANT DATE (the “Effective Date”). Any undefined terms appearing herein as defined terms shall have the same meaning as they do in the Comerica Incorporated 2006 Long-Term Incentive Plan, as amended and/or restated from time to time (the “Plan”). The Company will provide a copy of the Plan to the Award Recipient upon request.

WITNESSETH:

1. Award of Stock . Pursuant to the provisions of the Plan, the Company hereby awards the Award Recipient, subject to the terms and conditions of the Plan (incorporated herein by reference), and subject further to the terms and conditions in this Agreement, XXX Shares of $5.00 par value common stock of the Company (the “Stock Award”). The Stock Award is intended to constitute “long-term restricted stock”, as such term is defined by the Emergency Economic Stabilization Act of 2008, as amended from time to time, including by the American Recovery and Reinvestment Act of 2009 (collectively, “EESA”), and the regulations and guidance promulgated thereunder, as amended from time to time (the “EESA Guidance”), and the Stock Award shall be subject to all limitations and restrictions necessary to qualify it as long-term restricted stock thereunder for the periods required thereunder.

2. Vesting of Stock Award . Until it is vested, the Stock Award is subject to forfeiture. Subject to the terms of the Plan and this Agreement, including without limitation, paragraph 5, and fulfillment of the employment requirements in paragraph 4 below, the Stock Award will vest and become free of restrictions on the fifth anniversary of the Effective Date of this Stock Award. Notwithstanding the foregoing, unless otherwise permitted under the EESA Guidance, even after vesting, the Stock Award may not be transferred until the Company has repaid any obligation arising from the financial assistance provided to it under the Capital Purchase Program (the “CPP”) under the Troubled Asset Relief Program (“TARP”) (other than warrants to purchase common stock), except that (1) if the Stock Award vests prior to the Company’s repayment of its obligation arising from the financial assistance provided to it under the CPP and (2) in such a case, provided that the Award Recipient has not made an election under section 83(b) of the Code with respect to this Stock Award, then from the date on which the Stock Award vests through December 31 of the calendar year that includes such vesting date, a portion of the Stock Award shall become transferable as is reasonably required to pay any federal, state, local or foreign taxes that are anticipated to apply to the income recognized due to this vesting, with such portion to be determined by the Company in its sole discretion. As soon as administratively feasible after the vesting of the Stock Award and the satisfaction of any applicable taxes pursuant to paragraph 12 of this Agreement, the Company will deliver to the Award Recipient (or to the designated Beneficiary of the Award Recipient if the Award Recipient is not then living) evidence of his or her ownership (by book entry or certificate), of the Shares subject to the vested Stock Award for which any applicable taxes have been paid.

3. Cancellation of Stock Award . The Committee has the right to cancel for no consideration all or any portion of the Stock Award in accordance with Section 4 of the Plan if the Committee determines in good faith that the Award Recipient has done any of the following: (i) committed a felony; (ii) committed fraud; (iii) embezzled; (iv) disclosed confidential information or trade secrets; (v) was terminated for Cause; (vi) engaged in any activity in competition with the business of the Company or any Subsidiary or Affiliate of the Company; or (vii) engaged in conduct that adversely affected the Company. The Delegate shall have the power and authority to suspend the vesting of or the right to receive the Shares in respect of all or any portion of the Stock Award if the Delegate makes in good faith the determination described in the preceding sentence. Any such suspension of a Stock Award shall remain in effect until the suspension shall be presented to and acted on by the Committee at its next meeting. This paragraph 3 shall have no application for the two-year period following a Change of Control of the Company.

4. Employment Requirements . Except as provided in this Agreement, in order to vest in and not forfeit the Stock Award, the Award Recipient must remain employed by and continue performing substantial services for the Company or one of its Affiliates until the Stock Award has vested. If there is a Termination of Employment for any reason (other than due to death or Disability) before the Stock Award has vested, the Award Recipient will forfeit the Stock Award as of the date of the Termination of Employment, unless the Committee determines otherwise and such determination is permissible under applicable laws, rules and regulations, including, without limitation, EESA and the EESA Guidance, to the extent applicable. If there is a Termination of Employment due to the death or Disability of the Award Recipient prior to this Stock Award vesting, the Stock Award will vest as of the date of the Award Recipient’s Termination of Employment due to death or Disability.

5. Effect of a Change of Control . This Stock Award will vest and become free of restrictions on the date a Change of Control of the Company occurs, provided such vesting is permissible under EESA and the EESA Guidance, to the extent applicable.

6. Nontransferability . Neither this Stock Award, nor any of the rights pertaining thereto or under this Agreement, shall be transferable other than by will or the laws of intestacy until the Stock Award has vested ; provided, however , that the Award Recipient may, in the manner established by the Committee, designate a Beneficiary to receive any property distributable with respect to the Stock Award upon the death of the Award Recipient. Prior to vesting, this Stock Award and any rights pertaining thereto or under this Agreement may not be pledged, alienated, attached or otherwise encumbered. Any purported pledge, alienation, attachment or encumbrance of the Stock Award or rights pertaining thereto that is contrary to the provisions of this Agreement or the Plan shall be void and unenforceable against the Company or any Affiliate.

7. Voting and Dividends . Beginning upon the Effective Date, the Award Recipient shall have the right to vote the Shares underlying the unvested Stock Award and to receive any cash dividends or cash distributions that may be paid with respect thereto. Subject to Section 11(D) of the Plan, in the event of a stock dividend, stock distribution, stock split, division of shares or other corporate structure change which results in the issuance of additional Shares with respect to any Share of the Stock Award prior to such Stock Award having vested, such additional Shares will be subject to the same restrictions and vesting requirements as are applicable to such unvested Share of the Stock Award.

8. No Right to Continued Employment . Nothing in the Plan or this Agreement shall confer on the Award Recipient any right to continue in the employment of the Company or its Affiliates for any given period or on any specified terms nor in any way affect the Company’s or its Affiliates’ right to terminate the Award Recipient’s employment without prior notice at any time for any reason or for no reason.

9. Compliance with Laws and Regulations . The Stock Award and the obligation of the Company to deliver the Shares subject to the Stock Award are subject to compliance with all applicable laws, rules and regulations, including, without limitation, for the period required by EESA and the EESA Guidance, EESA and the EESA Guidance, and to receipt of any approvals by any government or regulatory agency as may be required, and to any determinations the Company may make regarding the application of all such laws, rules and regulations . In addition, the Award Recipient agrees that the Award Recipient’s rights to compensation under this Agreement and participation in the Company’s other compensation and benefits arrangements (this Agreement and any and all such arrangements, collectively, the “Benefit Plans”) will be limited to ensure that such Benefit Plans comply with and are administered in accordance with the provisions of EESA and the EESA Guidance for the period required by EESA and the EESA Guidance. Accordingly, the Award Recipient hereby (A) acknowledges and understands that any compensation payable to the Award Recipient under any Benefit Plan, including without limitation under this Agreement, shall be subject to EESA and the EESA Guidance to the extent necessary to comply with EESA and the EESA Guidance, including, without limitation, (x) the potential for clawback of any bonus, retention or incentive compensation paid or granted to the Award Recipient under any Benefit Plan based on statements of earnings, revenues, gains or other criteria that are later found to be materially inaccurate or as otherwise provided under the EESA Guidance and (y) the potential for the reduction or elimination of the amounts payable to the Award Recipient under this Agreement or otherwise as a result of the limitations on golden parachute payments under EESA and the EESA Guidance and (B) consents to any modifications and limitations prior to a Change of Control with respect to, and under, the Benefit Plans to the extent necessary to ensure compliance with EESA and the EESA Guidance.

10. Binding Nature of Plan . The Award Recipient agrees to be bound by all terms and provisions of the Plan and related administrative rules and procedures, including terms and provisions and administrative rules and procedures adopted and/or modified after the granting of the Stock Award. In the event any provisions of this Agreement are inconsistent with those of the Plan, the provisions of the Plan shall control, unless the application of the Plan provision would result in a violation of EESA or the EESA Guidance.

11. Notices . Any notice to the Company under this Agreement shall be in writing to the following address or facsimile number: Human Resources - Executive Compensation, Comerica Incorporated, 1717 Main Street, MC 6515, Dallas, TX 75201; Facsimile Number: 214-462-4430. The Company will address any notice to the Award Recipient to his or her current address according to the Company’s personnel files. All written notices provided in accordance with this paragraph shall be deemed to be given when (a) delivered to the appropriate address(es) by hand or by a nationally recognized overnight courier service (costs prepaid); (b) sent by facsimile to the appropriate facsimile number, with confirmation by telephone of transmission receipt; or (c) received by the addressee, if sent by U.S. mail to the appropriate address or by Company inter-office mail to the appropriate mail code. Either party may designate in writing some other address or facsimile number for notice under this Agreement.

12. Withholding . No later than the date as of which an amount first becomes includible in the gross income of the Award Recipient for Federal income tax purposes with respect to any Shares subject to this Stock Award, the Award Recipient shall pay to the Company, or make arrangements satisfactory to the Company regarding the payment of, the minimum statutory amount of Federal, state and local withholding taxes with respect thereto. The Award Recipient authorizes the Company to withhold from his or her compensation to satisfy any such income and employment tax withholding obligations in connection with the Stock Award. The Award Recipient agrees that the Company may delay removal of the restrictive legend until proper payment of such taxes has been made by the Award Recipient. Unless determined otherwise by the Committee, the Award Recipient may satisfy such obligations under this paragraph 12 by any method authorized under Section 9 of the Plan.

13. Voluntary Participation. Participation in the Plan is voluntary.

14. Force and Effect . The various provisions of this Agreement are severable in their entirety. Any judicial or legal determination of invalidity or unenforceability of any one provision shall have no effect on the continuing force and effect of the remaining provisions.

15. Successors . This Agreement shall be binding upon and inure to the benefit of the successors of the respective parties.

IN WITNESS WHEREOF, this Agreement has been executed by an appropriate officer of Comerica Incorporated and by the Award Recipient, both as of the day and year first above written.

COMERICA INCORPORATED


By:
Name:	[ ]
Title:	Executive Vice President
	Corporate Human Resources


AWARD RECIPIENT


Name: [Insert Award Recipient’s Name]

Exhibit 10.42

CHANGE OF CONTROL EMPLOYMENT AGREEMENT (BE4 AND HIGHER)

CHANGE OF CONTROL EMPLOYMENT AGREEMENT, dated as of the day of , 20 (this “Agreement”), by and between COMERICA INCORPORATED, a Delaware corporation (the “Company”), and (the “Executive”).

WHEREAS, the Board of Directors of the Company (the “Board”), has determined that it is in the best interests of the Company and its stockholders to assure that the Company will have the continued dedication of the Executive, notwithstanding the possibility, threat or occurrence of a Change of Control (as defined herein). The Board believes it is imperative to diminish the inevitable distraction of the Executive by virtue of the personal uncertainties and risks created by a pending or threatened Change of Control and to encourage the Executive’s full attention and dedication to the Company in the event of any threatened or pending Change of Control, and to provide the Executive with compensation and benefits arrangements upon a Change of Control that ensure that the compensation and benefits expectations of the Executive will be satisfied and that provide the Executive with compensation and benefits arrangements that are competitive with those of other corporations. Therefore, in order to accomplish these objectives, the Board has caused the Company to enter into this Agreement.

NOW, THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:

Section 1. Certain Definitions . (a) “Effective Date” means the first date during the Change of Control Period (as defined herein) on which a Change of Control occurs. Notwithstanding anything in this Agreement to the contrary, if (A) the Executive’s employment with the Company is terminated by the Company, (B) the Date of Termination is prior to the date on which a Change of Control occurs, and (C) it is reasonably demonstrated by the Executive that such termination of employment (i) was at the request of a third party that has taken steps reasonably calculated to effect a Change of Control or (ii) otherwise arose in connection with or anticipation of a Change of Control (such a termination of employment, an “Anticipatory Termination”), then for all purposes of this Agreement, the “Effective Date” means the date immediately prior to such Date of Termination.

(b) “Change of Control Period” means the period commencing on the date hereof and ending on the third anniversary of the date hereof; provided , however , that, commencing on the date one year after the date hereof, and on each annual anniversary of such date (such date and each annual anniversary thereof, the “Renewal Date”), unless previously terminated, the Change of Control Period shall be automatically extended so as to terminate three years from such Renewal Date, unless, at least 60 days prior to the Renewal Date, the Company shall give notice to the Executive that the Change of Control Period shall not be so extended.

(c) “Affiliated Company” means any company controlled by, controlling or under common control with the Company.

(d) “Change of Control” means:

(1) Any individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) (a “Person”) becomes the beneficial owner (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 20% or more of either (A) the then-outstanding shares of common stock of the Company (the “Outstanding Company Common Stock”) or (B) the combined voting power of the then-outstanding voting securities of the Company entitled to vote generally in the election of directors (the “Outstanding Company Voting Securities”); provided , however , that, for purposes of this Section 1(d), the following acquisitions shall not constitute a Change of Control: (i) any acquisition directly from the Company, (ii) any acquisition by the Company, (iii) any acquisition by any employee benefit plan (or related trust) sponsored or maintained by the Company or any Affiliated Company or (iv) any acquisition pursuant to a transaction that complies with Sections 1(d)(3)(A), 1(d)(3)(B) and 1(d)(3)(C);

(2) Individuals who, as of the date hereof, constitute the Board (the “Incumbent Board”) cease for any reason to constitute at least a majority of the Board; provided , however , that any individual becoming a director subsequent to the date hereof whose election, or nomination for election by the Company’s stockholders, was approved by a vote of at least a majority of the directors then comprising the Incumbent Board shall be considered as though such individual was a member of the Incumbent Board, but excluding, for this purpose, any such individual whose initial assumption of office occurs as a result of an actual or threatened election contest with respect to the election or removal of directors or other actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Board;

(3) Consummation of a reorganization, merger, statutory share exchange or consolidation or similar transaction involving the Company or any of its subsidiaries, a sale or other disposition of all or substantially all of the assets of the Company, or the acquisition of assets or stock of another entity by the Company or any of its subsidiaries (each, a “Business Combination”), in each case unless, following such Business Combination, (A) all or substantially all of the individuals and entities that were the beneficial owners of the Outstanding Company Common Stock and the Outstanding Company Voting Securities immediately prior to such Business Combination beneficially own, directly or indirectly, more than 50% of the then-outstanding shares of common stock (or, for a non-corporate entity, equivalent securities) and the combined voting power of the then-outstanding voting securities entitled to vote generally in the election of directors (or, for a non-corporate entity, equivalent governing body), as the case may be, of the entity resulting from such Business Combination (including, without limitation, an entity that, as a result of such transaction, owns the Company or all or substantially all of the Company’s assets either directly or through one or more subsidiaries) in substantially the same proportions as their ownership immediately prior to such Business Combination of the Outstanding Company Common Stock and the Outstanding Company Voting Securities, as the case may be, (B) no Person (excluding any corporation resulting from such Business Combination or any employee benefit plan (or related trust) of the Company or such corporation resulting from such Business Combination) beneficially owns, directly or indirectly, 20% or more of, respectively, the then-outstanding shares of common stock of the corporation resulting from such Business Combination or the combined voting power of the then-outstanding voting securities of such corporation, except to the extent that such ownership existed prior to the Business Combination, and (C) at least a majority of the members of the board of directors (or, for a non-corporate entity, equivalent governing body) of the entity resulting from such Business

Combination were members of the Incumbent Board at the time of the execution of the initial agreement or of the action of the Board providing for such Business Combination; or

(4) Approval by the stockholders of the Company of a complete liquidation or dissolution of the Company.

Section 2. Employment Period . The Company hereby agrees to continue the Executive in its employ, subject to the terms and conditions of this Agreement, for the period commencing on the Effective Date and ending on the last day of the thirtieth consecutive month following the Effective Date (the “Employment Period”). The Employment Period shall terminate upon the Executive’s termination of employment for any reason.

Section 3. Terms of Employment . (a) Position and Duties .

(1) During the Employment Period, (A) the Executive’s position (including status, offices, titles and reporting requirements), authority, duties and responsibilities shall be at least commensurate in all respects with the most significant of those held, exercised and assigned at any time during the 120-day period immediately preceding the Effective Date, and (B) the Executive’s services shall be performed at the location where the Executive was employed immediately preceding the Effective Date or at any office or location less than 60 miles from such location.

(2) During the Employment Period, and excluding any periods of vacation and sick leave to which the Executive is entitled, the Executive agrees to devote reasonable attention and time during normal business hours to the business and affairs of the Company and, to the extent necessary to discharge the responsibilities assigned to the Executive hereunder, to use the Executive’s reasonable best efforts to perform faithfully and efficiently such responsibilities. During the Employment Period, it shall not be a violation of this Agreement for the Executive to (A) serve on corporate, civic or charitable boards or committees, (B) deliver lectures, fulfill speaking engagements or teach at educational institutions and (C) manage personal investments, so long as such activities do not significantly interfere with the performance of the Executive’s responsibilities as an employee of the Company in accordance with this Agreement. It is expressly understood and agreed that, to the extent that any such activities have been conducted by the Executive prior to the Effective Date, the continued conduct of such activities (or the conduct of activities similar in nature and scope thereto) subsequent to the Effective Date shall not thereafter be deemed to interfere with the performance of the Executive’s responsibilities to the Company.

(b) Compensation . (1) Base Salary . During the Employment Period, the Executive shall receive an annual base salary (the “Annual Base Salary”) at an annual rate at least equal to 26 times the highest bi-weekly base salary paid or payable, including any base salary that has been earned but deferred, to the Executive by the Company and the Affiliated Companies in respect of the one-year period immediately preceding the month in which the Effective Date occurs. The Annual Base Salary shall be paid to the Executive at such intervals as the Company pays executive salaries generally, unless the Executive shall elect to defer the receipt of such Base Salary pursuant to an arrangement that meets the requirements of Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”). During the Employment Period, the Annual Base Salary shall be reviewed at least annually, beginning no more than 12

months after the last salary increase awarded to the Executive prior to the Effective Date. Any increase in the Annual Base Salary shall not serve to limit or reduce any other obligation to the Executive under this Agreement. The Annual Base Salary shall not be reduced after any such increase and the term “Annual Base Salary” shall refer to the Annual Base Salary as so increased.

(2) Annual Bonus . In addition to the Annual Base Salary, the Executive shall be awarded, for each fiscal year ending during the Employment Period, an annual bonus (the “Annual Bonus”) in cash at least equal to the aggregate of the Executive’s highest bonus under each of

(i) the Company’s Management Incentive Plan; and

(ii) any business unit incentive plan of the Company in which the Executive has participated during any portion of the last three fiscal years (or any predecessor or successor plan to any thereof), as applicable, for the last three full fiscal years prior to the Effective Date, including any bonus or portion thereof that has been earned but deferred (annualized in the event that the Executive was not employed by the Company for the whole of such fiscal year and not otherwise paid a full year’s bonus for such year) (the “Recent Annual Bonus”). For purposes of determining the Recent Annual Bonus, the highest bonus under the Management Incentive Plan shall be determined by including bonuses earned for both the annual and multiyear performance periods ending in each of the last three full fiscal years prior to the Effective Date (or for such lesser number of full fiscal years prior to the Effective Date for which the Executive was eligible to earn such a bonus and annualized in the case of any pro rata bonus earned for a partial fiscal year). Each such Annual Bonus shall be paid no later than two and a half months after the end of the fiscal year for which the Annual Bonus is awarded, unless the Executive shall elect to defer the receipt of such Annual Bonus pursuant to an arrangement that meets the requirements of Section 409A of the Code.

(3) Long-Term Equity Incentives, Savings and Retirement Plans . During the Employment Period, the Executive shall be entitled to participate in all equity incentive, savings and retirement plans, practices, policies, and programs applicable generally to other peer executives of the Company and the Affiliated Companies, but in no event shall such plans, practices, policies and programs provide the Executive with incentive opportunities (measured with respect to both regular and special incentive opportunities, to the extent, if any, that such distinction is applicable), savings opportunities and retirement benefit opportunities, in each case, less favorable, in the aggregate, than the most favorable of those provided by the Company and the Affiliated Companies for the Executive under such plans, practices, policies and programs as in effect at any time during the 120-day period immediately preceding the Effective Date or, if more favorable to the Executive, those provided generally at any time after the Effective Date to other peer executives of the Company and the Affiliated Companies.

(4) Welfare Benefit Plans . During the Employment Period, the Executive and/or the Executive’s family, as the case may be, shall be eligible for participation in and shall receive all benefits under welfare benefit plans, practices, policies and programs provided by the Company and the Affiliated Companies (including, without limitation, medical, prescription, dental, disability, employee life, group life, accidental death and travel accident insurance plans

and programs) to the extent applicable generally to other peer executives of the Company and the Affiliated Companies, but in no event shall such plans, practices, policies and programs provide the Executive with benefits that are less favorable, in the aggregate, than the most favorable of such plans, practices, policies and programs in effect for the Executive at any time during the 120-day period immediately preceding the Effective Date or, if more favorable to the Executive, those provided generally at any time after the Effective Date to other peer executives of the Company and the Affiliated Companies.

(5) Expenses . During the Employment Period, the Executive shall be entitled to receive prompt reimbursement for all reasonable expenses incurred by the Executive in accordance with the most favorable policies, practices and procedures of the Company and the Affiliated Companies in effect for the Executive at any time during the 120-day period immediately preceding the Effective Date or, if more favorable to the Executive, as in effect generally at any time thereafter with respect to other peer executives of the Company and the Affiliated Companies.

(6) Fringe Benefits . During the Employment Period, the Executive shall be entitled to fringe benefits, including, without limitation, tax planning services, payment of club dues, and, if applicable, use of an automobile and payment of related expenses, in accordance with the most favorable plans, practices, programs and policies of the Company and the Affiliated Companies in effect for the Executive at any time during the 120-day period immediately preceding the Effective Date or, if more favorable to the Executive, as in effect generally at any time thereafter with respect to other peer executives of the Company and the Affiliated Companies.

(7) Office and Support Staff . During the Employment Period, the Executive shall be entitled to an office or offices of a size and with furnishings and other appointments, and to exclusive personal secretarial and other assistance, at least equal to the most favorable of the foregoing provided to the Executive by the Company and the Affiliated Companies at any time during the 120-day period immediately preceding the Effective Date or, if more favorable to the Executive, as provided generally at any time thereafter with respect to other peer executives of the Company and the Affiliated Companies.

(8) Vacation . During the Employment Period, the Executive shall be entitled to paid vacation in accordance with the most favorable plans, policies, programs and practices of the Company and the Affiliated Companies as in effect for the Executive at any time during the 120-day period immediately preceding the Effective Date or, if more favorable to the Executive, as in effect generally at any time thereafter with respect to other peer executives of the Company and the Affiliated Companies.

Section 4. Termination of Employment . (a) Death or Disability . The Executive’s employment shall terminate automatically if the Executive dies during the Employment Period. If the Company determines in good faith that the Disability (as defined herein) of the Executive has occurred during the Employment Period (pursuant to the definition of “Disability”), it may give to the Executive written notice in accordance with Section 11(b) of its intention to terminate the Executive’s employment. In such event, the Executive’s employment with the Company shall terminate effective on the 30th day after receipt of such

notice by the Executive (the “Disability Effective Date”), provided that, within the 30 days after such receipt, the Executive shall not have returned to full-time performance of the Executive’s duties. “Disability” means the absence of the Executive from the Executive’s duties with the Company on a full-time basis for 180 consecutive business days as a result of incapacity due to mental or physical illness that is determined to be total and permanent by a physician selected by the Company or its insurers and acceptable to the Executive or the Executive’s legal representative.

(b) Cause . The Company may terminate the Executive’s employment during the Employment Period with or without Cause. “Cause” means:

(1) the willful and continued failure of the Executive to perform substantially the Executive’s duties with the Company or any Affiliated Company (other than any such failure resulting from incapacity due to physical or mental illness), after a written demand for substantial performance is delivered to the Executive by the Board or the Chief Executive Officer of the Company that specifically identifies the manner in which the Board or the Chief Executive Officer of the Company believes that the Executive has not substantially performed the Executive’s duties, or

(2) the willful engaging by the Executive in illegal conduct or gross misconduct that is materially and demonstrably injurious to the Company.

For purposes of this Section 4(b), no act, or failure to act, on the part of the Executive shall be considered “willful” unless it is done, or omitted to be done, by the Executive in bad faith or without reasonable belief that the Executive’s action or omission was in the best interests of the Company. Any act, or failure to act, based upon (A) authority given pursuant to a resolution duly adopted by the Board, or if the Company is not the ultimate parent corporation of the Affiliated Companies and is not publicly-traded, the board of directors of the ultimate parent of the Company (the “Applicable Board”), (B) the instructions of the Chief Executive Officer of the Company or a senior officer of the Company or (C) the advice of counsel for the Company shall be conclusively presumed to be done, or omitted to be done, by the Executive in good faith and in the best interests of the Company. The cessation of employment of the Executive shall not be deemed to be for Cause unless and until there shall have been delivered to the Executive a copy of a resolution duly adopted by the affirmative vote of not less than three-quarters of the entire membership of the Applicable Board (excluding the Executive, if the Executive is a member of the Applicable Board) at a meeting of the Applicable Board called and held for such purpose (after reasonable notice is provided to the Executive and the Executive is given an opportunity, together with counsel for the Executive, to be heard before the Applicable Board), finding that, in the good faith opinion of the Applicable Board, the Executive is guilty of the conduct described in Section 4(b)(1) or 4(b)(2), and specifying the particulars thereof in detail.

(c) Good Reason . The Executive’s employment may be terminated during the Employment Period by the Executive for Good Reason or by the Executive voluntarily without Good Reason. “Good Reason” means:

(1) the assignment to the Executive of any duties inconsistent in any respect with the Executive’s position (including status, offices, titles and reporting requirements), authority,

duties or responsibilities as contemplated by Section 3(a), or any action by the Company that results in a diminution in such position, authority, duties or responsibilities, excluding for this purpose an isolated, insubstantial and inadvertent action not taken in bad faith and that is remedied by the Company promptly after receipt of notice thereof given by the Executive;

(2) any failure by the Company to comply with any of the provisions of Section 3(b), other than an isolated, insubstantial and inadvertent failure not occurring in bad faith and that is remedied by the Company promptly after receipt of notice thereof given by the Executive;

(3) the Company’s requiring the Executive to be based at any office or location other than as provided in Section 4(a)(i)(B) hereof or the Company’s requiring the Executive to travel on Company business to a substantially greater extent than required immediately prior to the Effective Date;

(4) any purported termination by the Company of the Executive’s employment otherwise than as expressly permitted by this Agreement; or

(5) any failure by the Company to comply with and satisfy Section 10(c).

For purposes of this Section 4(c) of this Agreement, any good faith determination of Good Reason made by the Executive shall be conclusive. The Executive’s mental or physical incapacity following the occurrence of an event described above in clauses (1) through (5) shall not affect the Executive’s ability to terminate employment for Good Reason.

(d) Notice of Termination . Any termination by the Company for Cause, or by the Executive for Good Reason, shall be communicated by Notice of Termination to the other party hereto given in accordance with Section 11(b). “Notice of Termination” means a written notice that (1) indicates the specific termination provision in this Agreement relied upon, (2) to the extent applicable, sets forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of the Executive’s employment under the provision so indicated, and (3) if the Date of Termination (as defined herein) is other than the date of receipt of such notice, specifies the Date of Termination (which Date of Termination shall be not more than 30 days after the giving of such notice). The failure by the Executive or the Company to set forth in the Notice of Termination any fact or circumstance that contributes to a showing of Good Reason or Cause shall not waive any right of the Executive or the Company, respectively, hereunder or preclude the Executive or the Company, respectively, from asserting such fact or circumstance in enforcing the Executive’s or the Company’s respective rights hereunder.

(e) Date of Termination . “Date of Termination” means (1) if the Executive’s employment is terminated by the Company for Cause, or by the Executive for Good Reason, the date of receipt of the Notice of Termination or such later date specified in the Notice of Termination, as the case may be, (2) if the Executive’s employment is terminated by the Company other than for Cause or Disability, the date on which the Company notifies the Executive of such termination, (3) if the Executive resigns without Good Reason, the date on which the Executive notifies the Company of such termination, and (4) if the Executive’s employment is terminated by reason of death or Disability, the date of death of the Executive or the Disability Effective Date, as the case may be. Notwithstanding the foregoing, in no event

shall the Date of Termination occur until the Executive experiences a “separation from service” within the meaning of Section 409A of the Code, and notwithstanding anything contained herein to the contrary, the date on which such separation from service takes place shall be the “Date of Termination.”

Section 5. Obligations of the Company upon Termination . (a) By the Executive for Good Reason; By the Company Other Than for Cause, Death or Disability . If, during the Employment Period, the Company terminates the Executive’s employment other than for Cause, Death or Disability or the Executive terminates employment for Good Reason:

(1) the Company shall pay to the Executive, in a lump sum in cash within 30 days after the Date of Termination, the aggregate of the following amounts:

(A) the sum of (i) the Executive’s Annual Base Salary through the Date of Termination to the extent not theretofore paid or deferred pursuant to an irrevocable election under any deferred compensation arrangement subject to Section 409A, (ii) any accrued vacation pay to the extent not theretofore paid (the sum of the amounts described in subclauses (i) and (ii), the “Accrued Obligations”) and (iii) an amount equal to the product of (x) the higher of (I) the Recent Annual Bonus and (II) the aggregate Annual Bonus under each of the Company’s Management Incentive Plan and any business unit incentive plan of the Company in which the Executive has participated (or any predecessor or successor plan to any thereof) paid or payable, including any bonus or portion thereof that has been earned but deferred (and annualized for any fiscal year consisting of less than 12 full months or during which the Executive was employed for less than 12 full months), for the most recently completed fiscal year during the Employment Period, if any, (it being understood that, such Annual Bonus shall be determined by including bonuses earned for both the annual and multiyear performance periods ending in such recently completed fiscal year during the Employment Period) (such higher amount, the “Highest Annual Bonus”) and (y) a fraction, the numerator of which is the number of days in the current fiscal year through the Date of Termination and the denominator of which is 365 (the “Pro Rata Bonus”); and

(B) the amount equal to the product of (i) three and (ii) the sum of (x) the Executive’s Annual Base Salary and (y) the Highest Annual Bonus.

(2) [ FOR THE AGREEMENTS OF EXECUTIVES COMMENCING EMPLOYMENT PRIOR TO JANUARY 1, 2007: the Company shall pay to the Executive, at such time as such amounts are payable under the terms of each applicable SERP (as defined below), or, if the Executive does not participate in a SERP, in a lump sum in cash within 30 days after the Date of Termination, an amount equal to the excess of (i) the actuarial equivalent of the benefit under the Company’s qualified defined benefit retirement plan (the “Retirement Plan”) (utilizing actuarial assumptions no less favorable to the Executive than those in effect under the Retirement Plan immediately prior to the Effective Date) and any excess or supplemental retirement plan in which the Executive participates (collectively, the “SERP”) (utilizing actuarial assumptions no less favorable to the Executive than those in effect under the SERP immediately prior to the

Effective Date) that the Executive would receive if the Executive’s employment continued for three years after the Date of Termination, assuming for this purpose that (x) the accrued benefit is fully vested, (y) the Executive’s age is increased by the number of years (including partial years) that the Executive is deemed to be so employed and (z) the Executive’s compensation in each of the three years is that required by Sections 3(b)(1) and 3(b)(2) payable in equal biweekly installments over such three-year period, over (ii) the actuarial equivalent of the Executive’s actual benefit (paid or payable), if any, under the Retirement Plan and the SERP as of the Date of Termination;]

[ FOR THE AGREEMENTS OF EXECUTIVES COMMENCING EMPLOYMENT ON OR AFTER JANUARY 1, 2007: the Company shall pay to the Executive, at such time as such amounts are payable under the terms of each applicable SERP (as defined below), or, if the Executive does not participate in a SERP, in a lump sum in cash within 30 days after the Date of Termination, an amount equal to the excess of (i) the account balance under the Company’s qualified defined contribution retirement plan (the “Defined Contribution Plan”) and any excess or supplemental defined contribution plan in which the Executive participates (collectively, the “SERP”) that the Executive would receive if the Executive’s employment continued for three years after the Date of Termination, assuming for this purpose that (x) the account balance is fully vested, (y) the Company makes a nonelective employer contribution to the SERP for each year in such three-year period in an amount equal to the greatest nonelective employer contribution made to such plan during the last three full fiscal years prior to the Effective Date and (z) the Executive’s compensation in each of the three years is that required by Section 3(b)(1) and Section 3(b)(2) payable in equal biweekly installments for such three-year period, over (ii) the account balance (paid or payable), if any, under the Defined Contribution Plan and the SERP as of the Date of Termination;]

(3) during the three year period following the Date of Termination (the “Benefits Period”), the Company shall provide the Executive, his spouse and his eligible dependents with medical and dental insurance coverage (the “Health Care Benefits”) and life insurance benefits no less favorable to those which the Executive, his spouse and his eligible dependents were receiving immediately prior to the Date of Termination or, if more favorable to such persons, as in effect generally at any time thereafter with respect to other peer executives of the Company and the Affiliated Companies; provided , however , that the Health Care Benefits shall be provided during the Benefits Period in such a manner that such benefits are excluded from the Executive’s income for federal income tax purposes; provided, further, however , that if the Executive becomes re-employed with another employer and is eligible to receive health care benefits under another employer-provided plan, the health care benefits provided hereunder shall be secondary to those provided under such other plan during such applicable period of eligibility . The receipt of the Health Care Benefits shall be conditioned upon the Executive continuing to pay the monthly premium as in effect at the Company from time to time for coverage provided to former employees under Section 4980B of the Code in respect of the maximum level of coverage that the Executive could otherwise elect to receive for the Executive, his spouse and eligible dependents if the Executive were still an employee of the Company during the Benefits Period ( i.e. , single, single plus one, or family) (the “Applicable COBRA Premium”) regardless of what level of coverage is

actually elected. During the portion of the Benefits Period in which the Executive, his spouse and his eligible dependents continue to receive coverage under the Company’s Health Care Benefits plans, the Company shall pay to the Executive a monthly amount equal to the excess of (x) the Applicable COBRA Premium over (y) the monthly employee contribution rate that is paid by Company employees generally for the same or similar coverage, as in effect from time to time (and which amount shall in no event be greater than the employee contribution rate for the applicable level of coverage as in effect immediately prior to the Effective Date), which payment shall be paid in advance on the first payroll day of each month, commencing with the month immediately following the Executive’s Date of Termination. The Company shall use its reasonable best efforts to ensure that, following the end of the Benefit Period, the Executive shall be eligible to elect continued health coverage pursuant to Section 4980B of the Code or other applicable law (“COBRA Coverage”), as if the Executive’s employment with the Company had terminated as of the end of such period. For purposes of determining eligibility (but not the time of commencement of benefits) of the Executive for retiree welfare benefits pursuant to the Company’s retiree welfare benefit plans, if any, the Executive shall be considered to have remained employed until the end of the Benefit Period and to have retired on the last day of such period. In order to comply with Section 409A of the Code, (i) the amount of benefits that the Company is obligated to provide under this Section 5(a)(3) in any given calendar year shall not affect the amount of such benefits that the Company is obligated to pay in any other calendar year; and (ii) the Executive’s right to have the Company provide such benefits may not be liquidated or exchanged for any other benefit ; and

(4) the Company shall, at its sole expense as incurred, provide the Executive with outplacement services the scope and provider of which shall be selected by the Executive in the Executive’s sole discretion, provided that such outplacement benefits shall end not later than the last day of the second calendar year that begins after the Date of Termination; and

(5) except as otherwise set forth in the last sentence of Section 6, to the extent not theretofore paid or provided, the Company shall timely pay or provide to the Executive any Other Benefits (as defined in Section 6) in accordance with the terms of the underlying plans or agreements.

Notwithstanding the foregoing provisions of Sections 5(a)(1), (2) or (3), in the event that the Executive is a “specified employee” within the meaning of Section 409A of the Code (as determined in accordance with the methodology established by the Company as in effect on the Date of Termination) (a “Specified Employee”), amounts that constitute “nonqualified deferred compensation” within the meaning of Section 409A of the Code that would otherwise be payable and benefits that would otherwise be provided under Sections 5(a)(1), (2) or (3) during the six-month period immediately following the Date of Termination (other than the Accrued Obligations) shall instead be paid, with interest on any delayed payment at the applicable federal rate provided for in Section 7872(f)(2)(A) of the Code (“Interest”) determined as of the Date of Termination, or provided on the first business day after the date that is six months following the Executive’s “separation from service” within the meaning of Section 409A of the Code (the “Delayed Payment Date”).

(b) Death . If the Executive’s employment is terminated by reason of the Executive’s death during the Employment Period, the Company shall provide the Executive’s estate or beneficiaries with the Accrued Obligations and the Pro Rata Bonus and the timely payment or delivery of the Other Benefits, and shall have no other severance obligations under this Agreement. The Accrued Obligations and the Pro Rata Bonus shall be paid to the Executive’s estate or beneficiary, as applicable, in a lump sum in cash within 30 days of the Date of Termination. With respect to the provision of the Other Benefits, the term “Other Benefits” as utilized in this Section 5(b) shall include, without limitation, and the Executive’s estate and/or beneficiaries shall be entitled to receive, benefits at least equal to the most favorable benefits provided by the Company and the Affiliated Companies to the estates and beneficiaries of peer executives of the Company and the Affiliated Companies under such plans, programs, practices and policies relating to death benefits, if any, as in effect with respect to other peer executives and their beneficiaries at any time during the 120-day period immediately preceding the Effective Date or, if more favorable to the Executive’s estate and/or the Executive’s beneficiaries, as in effect on the date of the Executive’s death with respect to other peer executives of the Company and the Affiliated Companies and their beneficiaries.

(c) Disability . If the Executive’s employment is terminated by reason of the Executive’s Disability during the Employment Period, the Company shall provide the Executive with the Accrued Obligations and Pro Rata Bonus and the timely payment or delivery of the Other Benefits in accordance with the terms of the underlying plans or agreements, and shall have no other severance obligations under this Agreement. The Accrued Obligations and the Pro Rata Bonus shall be paid to the Executive in a lump sum in cash within 30 days of the Date of Termination, provided , that in the event that the Executive is a Specified Employee, the Pro Rata Bonus shall be paid, with Interest, to the Executive on the Delayed Payment Date. With respect to the provision of the Other Benefits, the term “Other Benefits” as utilized in this Section 5(c) shall include, and the Executive shall be entitled after the Disability Effective Date to receive, disability and other benefits at least equal to the most favorable of those generally provided by the Company and the Affiliated Companies to disabled executives and/or their families in accordance with such plans, programs, practices and policies relating to disability, if any, as in effect generally with respect to other peer executives and their families at any time during the 120-day period immediately preceding the Effective Date or, if more favorable to the Executive and/or the Executive’s family, as in effect at any time thereafter generally with respect to other peer executives of the Company and the Affiliated Companies and their families.

(d) Cause; Other Than for Good Reason . If the Executive’s employment is terminated for Cause during the Employment Period, the Company shall provide the Executive with the Executive’s Annual Base Salary through the Date of Termination, and the timely payment or delivery of the Other Benefits, and shall have no other severance obligations under this Agreement. If the Executive voluntarily terminates employment during the Employment Period, excluding a termination for Good Reason, the Company shall provide to the Executive the Accrued Obligations and the Pro Rata Bonus and the timely payment or delivery of the Other Benefits, and shall have no other severance obligations under this Agreement. In such case, all the Accrued Obligations and the Pro Rata Bonus shall be paid to the Executive in a lump sum in cash within 30 days of the Date of Termination, provided , that in the event that the Executive is a

Specified Employee, the Pro Rata Bonus shall be paid, with Interest, to the Executive on the Delayed Payment Date.

Section 6. Non-exclusivity of Rights . Nothing in this Agreement shall prevent or limit the Executive’s continuing or future participation in any plan, program, policy or practice provided by the Company or the Affiliated Companies and for which the Executive may qualify, nor, subject to Section 11(f), shall anything herein limit or otherwise affect such rights as the Executive may have under any other contract or agreement with the Company or the Affiliated Companies. Amounts that are vested benefits or that the Executive is otherwise entitled to receive under any plan, policy, practice or program of or any other contract or agreement with the Company or the Affiliated Companies at or subsequent to the Date of Termination (“Other Benefits”) shall be payable in accordance with such plan, policy, practice or program or contract or agreement, except as explicitly modified by this Agreement. Without limiting the generality of the foregoing, the Executive’s resignation under this Agreement with or without Good Reason, shall in no way affect the Executive’s ability to terminate employment by reason of the Executive’s “retirement” under, or to be eligible to receive benefits under, any compensation and benefits plans, programs or arrangements of the Company or the Affiliated Companies, including without limitation any retirement or pension plans or arrangements or substitute plans adopted by the Company, the Affiliated Companies or their respective successors, and any termination which otherwise qualifies as Good Reason shall be treated as such even if it is also a “retirement” for purposes of any such plan. Notwithstanding the foregoing, if the Executive receives payments and benefits pursuant to Section 5(a) of this Agreement, the Executive shall not be entitled to any severance pay or benefits under any severance plan, program or policy of the Company and the Affiliated Companies, unless otherwise specifically provided therein in a specific reference to this Agreement. [ FOR CEO AGREEMENT ONLY: Notwithstanding anything in this Agreement to the contrary, in no event shall the benefits provided in the Supplemental Pension and Retiree Medical Agreement dated as of the 29 th day of May 1998 by and between the Company and the Executive (the “Supplemental Agreement”) be considered severance pay or benefits under any severance plan, program or policy of the Company for purposes of the immediately preceding sentence, and nothing in this Agreement shall limit the effectiveness of the Supplemental Agreement.]

Section 7. Full Settlement; Legal Fees . The Company’s obligation to make the payments provided for in this Agreement and otherwise to perform its obligations hereunder shall not be affected by any set-off, counterclaim, recoupment, defense, or other claim, right or action that the Company may have against the Executive or others. In no event shall the Executive be obligated to seek other employment or take any other action by way of mitigation of the amounts payable to the Executive under any of the provisions of this Agreement, and except as specifically provided in Section 5(a)(2), such amounts shall not be reduced whether or not the Executive obtains other employment. The Company agrees to pay as incurred (within 10 days following the Company’s receipt of an invoice from the Executive), at any time from the Change of Control through the Executive’s remaining lifetime (or, if longer, through the 20 th anniversary of the Change of Control) to the full extent permitted by law, all legal fees and expenses that the Executive may reasonably incur as a result of any contest (regardless of the outcome thereof) by the Company, the Executive or others of the validity or enforceability of, or liability under, any provision of this Agreement or any guarantee of performance thereof (including as a result of any contest by the Executive about the amount of

any payment pursuant to this Agreement), plus, in each case, Interest determined as of the date such legal fees and expenses were incurred; provided , that the Executive shall have submitted an invoice for such fees and expenses at least 10 days before the end of the calendar year next following the calendar year in which such fees and expenses were incurred (or, in connection with a contest related to an Anticipatory Termination, following the calendar year in which such contest is finally resolved). The amount of such legal fees and expenses that the Company is obligated to pay in any given calendar year shall not affect the legal fees and expenses that the Company is obligated to pay in any other calendar year, and the Executive’s right to have the Company pay such legal fees and expenses may not be liquidated or exchanged for any other benefit.

Section 8. Certain Additional Reductions .

(a) Anything in this Agreement to the contrary notwithstanding, in the event that the Accounting Firm shall determine that receipt of all Payments would subject an Executive to tax under Section 4999 of the Code, the Accounting Firm shall determine whether some amount of Agreement Payments meets the definition of “Reduced Amount.” If the Accounting Firm determines that there is a Reduced Amount, then the aggregate Agreement Payments shall be reduced to such Reduced Amount.

(b) If the Accounting Firm determines that the aggregate Agreement Payments should be reduced to the Reduced Amount, the Company shall promptly give the applicable Executive notice to that effect and a copy of the detailed calculation thereof, and the Executive may then elect, in his or her sole discretion, which and how much of the Agreement Payments shall be eliminated or reduced (as long as after such election the Present Value of the aggregate Agreement Payments equals the Reduced Amount); provided , that the Executive shall not be permitted to elect to reduce any Agreement Payment that constitutes “nonqualified deferred compensation” for purposes of Section 409A of the Code, and shall advise the Company in writing of his or her election within ten days of his or her receipt of notice. If no such election is made by the Executive within such ten-day period, the Company shall reduce the Agreement Payments in the following order: (1) by reducing benefits payable pursuant to Section 5(a)(1)(B) of the Agreement and then (2) by reducing amounts payable pursuant to Section 5(a)(2) of the Agreement. All determinations made by the Accounting Firm under this Section 8 shall be binding upon the Company and the Executive and shall be made within 60 days of the Executive’s Date of Termination. In connection with making determinations under this Section 8, the Accounting Firm shall take into account the value of any reasonable compensation for services to be rendered by the Executive before or after the Change of Control, including any non-competition provisions that may apply to the Executive and the Company shall cooperate in the valuation of any such services, including any non-competition provisions.

(c) As a result of the uncertainty in the application of Section 4999 of the Code at the time of the initial determination by the Accounting Firm hereunder, it is possible that amounts will have been paid or distributed by the Company to or for the benefit of the Executive pursuant to this Agreement which should not have been so paid or distributed (each, an “Overpayment”) or that additional amounts which will have not been paid or distributed by the Company to or for the benefit of the Executive pursuant to this Agreement could have been so paid or distributed (each, an “Underpayment”), in each case, consistent with the calculation of the Reduced

Amount hereunder. In the event that the Accounting Firm, based upon the assertion of a deficiency by the Internal Revenue Service against either the Company or the Executive which the Accounting Firm believes has a high probability of success determines that an Overpayment has been made, any such Overpayment paid or distributed by the Company to or for the benefit of the Executive shall be repaid by the Executive to the Company together with interest at the applicable federal rate provided for in Section 7872(f)(2) of the Code; provided , however, that no such repayment shall be required if and to the extent such deemed repayment would not either reduce the amount on which the Executive is subject to tax under Section 1 and Section 4999 of the Code or generate a refund of such taxes. In the event that the Accounting Firm, based upon controlling precedent or substantial authority, determines that an Underpayment has occurred, any such Underpayment shall be promptly paid by the Company to or for the benefit of the Executive together with interest at the applicable federal rate provided for in Section 7872(f)(2) of the Code.

(d) All fees and expenses of the Accounting Firm in implementing the provisions of this Section 8 shall be borne by the Company.

(e) Definitions . The following terms shall have the following meanings for purposes of this Section 8.

(1) A “Payment” shall mean any payment or distribution in the nature of compensation (within the meaning of Section 280G(b)(2) of the Code) to or for the benefit of the Executive, whether paid or payable pursuant to this Agreement or otherwise;

(2) “Agreement Payment” shall mean a Payment paid or payable pursuant to this Agreement (disregarding this Section);

(3) “Net After-Tax Receipt” shall mean the Present Value of a Payment net of all taxes imposed on the Executive with respect thereto under Sections 1 and 4999 of the Code and under applicable state and local laws, determined by applying the highest marginal rate under Section 1 of the Code and under state and local laws which applied to the Executive’s taxable income for the immediately preceding taxable year, or such other rate(s) as the Executive shall certify, in the Executive’s sole discretion, as likely to apply to the Executive in the relevant tax year(s);

(4) “Accounting Firm” shall mean such nationally recognized certified public accounting firm as may be designated by the Executive, other than the certified public accounting firm serving as the independent auditor of the Company or of another company that is a party to a Business Combination, if applicable ;

(5) “Parachute Value” of a Payment shall mean the present value as of the date of the change of control for purposes of Section 280G of the Code of the portion of such Payment that constitutes a “parachute payment” under Section 280G(b)(2), as determined by the Accounting Firm for purposes of determining whether and to what extent the Excise Tax will apply to such Payment; and

(6) “Reduced Amount” shall mean the amount of Agreement Payments that (x) has a Present Value that is less than the Present Value of all Agreement Payments and (y) results

in aggregate Net After-Tax Receipts for all Payments that are greater than the Net After-Tax Receipts for all Payments that would result if the aggregate Present Value of Agreement Payments were any other amount that is less than the Present Value of all Agreement Payments.

Section 9. Confidential Information . The Executive shall hold in a fiduciary capacity for the benefit of the Company all secret or confidential information, knowledge or data relating to the Company or the Affiliated Companies, and their respective businesses, which information, knowledge or data shall have been obtained by the Executive during the Executive’s employment by the Company or the Affiliated Companies and which information, knowledge or data shall not be or become public knowledge (other than by acts by the Executive or representatives of the Executive in violation of this Agreement). After termination of the Executive’s employment with the Company, the Executive shall not, without the prior written consent of the Company or as may otherwise be required by law or legal process, communicate or divulge any such information, knowledge or data to anyone other than the Company and those persons designated by the Company. In no event shall an asserted violation of the provisions of this Section 9 constitute a basis for deferring or withholding any amounts otherwise payable to the Executive under this Agreement.

Section 10. Successors . (a) This Agreement is personal to the Executive, and, without the prior written consent of the Company, shall not be assignable by the Executive other than by will or the laws of descent and distribution. This Agreement shall inure to the benefit of and be enforceable by the Executive’s legal representatives.

(b) This Agreement shall inure to the benefit of and be binding upon the Company and its successors and assigns. Except as provided in Section 10(c), without the prior written consent of the Executive this Agreement shall not be assignable by the Company.

(c) The Company will require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business and/or assets of the Company to assume expressly and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform it if no such succession had taken place. “Company” means the Company as hereinbefore defined and any successor to its business and/or assets as aforesaid that assumes and agrees to perform this Agreement by operation of law or otherwise.

Section 11. Miscellaneous . (a) This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware, without reference to principles of conflict of laws. The captions of this Agreement are not part of the provisions hereof and shall have no force or effect. Subject to the last sentence of Section 11(h), this Agreement may not be amended or modified other than by a written agreement executed by the parties hereto or their respective successors and legal representatives.

(b) All notices and other communications hereunder shall be in writing and shall be given by hand delivery to the other party or by registered or certified mail, return receipt requested, postage prepaid, addressed as follows:

if to the Executive:

At the most recent address on file at the Company.

if to the Company:

Comerica Incorporated

Comerica Bank Tower

1717 Main Street, MC 6404

Dallas, Texas 75201

Attention: General Counsel

or to such other address as either party shall have furnished to the other in writing in accordance herewith. Notice and communications shall be effective when actually received by the addressee.

(c) The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement.

(d) The Company may withhold from any amounts payable under this Agreement such United States federal, state or local or foreign taxes as shall be required to be withheld pursuant to any applicable law or regulation.

(e) The Executive’s or the Company’s failure to insist upon strict compliance with any provision of this Agreement or the failure to assert any right the Executive or the Company may have hereunder, including, without limitation, the right of the Executive to terminate employment for Good Reason pursuant to Sections 4(c)(1) through 4(c)(5), shall not be deemed to be a waiver of such provision or right or any other provision or right of this Agreement.

(f) The Executive and the Company acknowledge that, except as may otherwise be provided under any other written agreement between the Executive and the Company, the employment of the Executive by the Company is “at will” and, subject to Section 1(a), prior to the Effective Date, the Executive’s employment may be terminated by either the Executive or the Company at any time prior to the Effective Date, in which case the Executive shall have no further rights under this Agreement. From and after the Effective Date, except as specifically provided herein, this Agreement shall supersede any other agreement between the parties with respect to the subject matter hereof in effect immediately prior to the execution of this Agreement [FOR CEO AGREEMENT ONLY: other than the Supplemental Agreement]. [ FOR PERSONS COVERED OR WHO MAY BE COVERED BY TARP: The Executive acknowledges, understands and agrees that the Executive is currently or may be in the future subject to the provisions of the Emergency Economic Stabilization Act of 2008, as modified or amended from time to time, including pursuant to the American Recovery and Reinvestment Act of 2009 (“EESA”) and the rules, regulations and guidance issued thereunder from time to time (including without limitation the rules and regulations issued from time to time by the

Department of the Treasury (the “Department”), which shall include the TARP Standards for Corporate Governance issued under 31 CFR Part 30 as published in the Federal Register on June 15, 2009, as amended from time to time) (such rules, regulations and guidance, collectively, the “EESA Guidance”)) for the period required by EESA and the EESA Guidance. In addition, the Executive agrees that the Executive’s rights to compensation under this Agreement and participation in the Company’s compensation and benefits arrangements (this Agreement and any and all such arrangements, collectively, the “Benefit Plans”) will or may in the future be limited to ensure that such Benefit Plans comply with and are administered in accordance with the provisions of EESA and the EESA Guidance. Accordingly, the Executive hereby (A) acknowledges and understands that the compensation payable to the Executive under any Benefit Plan, including without limitation under this Agreement, may be subject to EESA and the EESA Guidance, including, without limitation, (x) the potential for clawback of any bonus, retention or incentive compensation paid or granted to the Executive under any Benefit Plan based on statements of earnings, revenues, gains or other criteria that are later found to be materially inaccurate or as otherwise provided under the EESA Guidance and (y) the potential for the reduction or elimination of the amounts payable to the Executive under this Agreement or otherwise as a result of the limitations on golden parachute payments under EESA and the EESA Guidance, (B) consents to any modifications and limitations prior to a Change of Control with respect to, and under, the Benefit Plans to the extent necessary to ensure compliance with EESA and the EESA Guidance, (C) voluntarily waives any claim against the Company and the Affiliated Companies for any changes prior to a Change of Control to the Executive’s compensation or benefits that are required to comply with the EESA Guidance in consideration for the benefits that the Executive will receive as a result of the Company’s participation in the Department’s Capital Purchase Program or any other program under EESA, and (E) agrees that such waiver and consent shall constitute a part of and be integrated with this Agreement.]

(g) The Agreement is intended to comply with the requirements of Section 409A of the Code or an exemption or exclusion therefrom and shall in all respects be administered in accordance with Section 409A of the Code. Each payment under this Agreement shall be treated as a separate payment for purposes of Section 409A of the Code. In no event may the Executive, directly or indirectly, designate the calendar year of any payment to be made under this Agreement. If the Executive dies following the Date of Termination and prior to the payment of the any amounts delayed on account of Section 409A of the Code, such amounts shall be paid to the personal representative of the Executive’s estate within 30 days after the date of the Executive’s death. All reimbursements and in-kind benefits that constitute deferred compensation within the meaning of Section 409A provided under this Agreement shall be made or provided in accordance with the requirements of Section 409A of the Code, including, without limitation, that (i) in no event shall reimbursements by the Company under this Agreement be made later than the end of the calendar year next following the calendar year in which the applicable fees and expenses were incurred, provided, that the Executive shall have submitted an invoice for such fees and expenses at least 10 days before the end of the calendar year next following the calendar year in which such fees and expenses were incurred; (ii) the amount of in-kind benefits that the Company is obligated to pay or provide in any given calendar year shall not affect the in-kind benefits that the Company is obligated to pay or provide in any other calendar year; (iii) the Executive’s right to have the Company pay or provide such reimbursements and in-kind benefits may not be liquidated or exchanged for any other benefit; and (iv) in no event shall the Company’s obligations to make such reimbursements or to provide

such in-kind benefits apply later than the Executive’s remaining lifetime (or if longer, through the 20th anniversary of the Effective Date). Prior to the Effective Date but within the time period permitted by the applicable Treasury Regulations, the Company may, in consultation with the Executive, modify the Agreement, in the least restrictive manner necessary and without any diminution in the value of the payments to the Executive, in order to cause the provisions of the Agreement to comply with the requirements of Section 409A of the Code, so as to avoid the imposition of taxes and penalties on the Executive pursuant to Section 409A of the Code.

Section 12. Survivorship . Upon the expiration or other termination of this Agreement or the Executive’s employment, the respective rights and obligations of the parties hereto shall survive to the extent necessary to carry out the intentions of the parties under this Agreement.

IN WITNESS WHEREOF, the Executive has hereunto set the Executive’s hand and, pursuant to the authorization from its Board of Directors, the Company has caused these presents to be executed in its name on its behalf, all as of the day and year first above written.


	[Name of Executive]


	COMERICA INCORPORATED


	By:

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FINANCIAL REVIEW AND REPORTS Comerica Incorporated and Subsidiaries

FINANCIAL REVIEW AND REPORTS

Comerica Incorporated and Subsidiaries


Performance Graph		10
Financial Results and Key Corporate Initiatives		12
Overview		14
Strategic Lines of Business		25
Balance Sheet and Capital Funds Analysis		30
Risk Management		38
Critical Accounting Policies		60
Supplemental Financial Data		66
Forward-Looking Statements		67
Consolidated Financial Statements:
	Consolidated Balance Sheets	69
	Consolidated Statements of Income	70
	Consolidated Statements of Changes in Shareholders' Equity	71
	Consolidated Statements of Cash Flows	72
Notes to Consolidated Financial Statements		73
Report of Management		150
Reports of Independent Registered Public Accounting Firm		151
Historical Review		153

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PERFORMANCE GRAPH

Comparison of Five Year Cumulative Total Return
Among Comerica Incorporated, Keefe Bank Index, and S&P 500 Index
(Assumes $100 Invested on 12/31/04 and Reinvestment of Dividends)

(a): In 2009, the Keefe 50-Bank Index was discontinued by Keefe, Bruyette and Woods. For comparative purposes, the Corporation replaced the Keefe 50-Bank Index with the Keefe Bank Index (BKX).

The performance shown on the graph is not necessarily indicative of future performance.

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SELECTED FINANCIAL DATA

	Years Ended December 31

	2009			2008			2007			2006			2005
	(dollar amounts in millions, except per share data)
EARNINGS SUMMARY
Net interest income	$	1,567		$	1,815		$	2,003		$	1,983		$	1,956
Provision for loan losses		1,082			686			212			37			(47	)
Noninterest income		1,050			893			888			855			819
Noninterest expenses		1,650			1,751			1,691			1,674			1,613
Provision (benefit) for income taxes		(131	)		59			306			345			393
Net income		17			213			686			893			861
Preferred stock dividends		134			17			—			—			—
Net income (loss) attributable to common shares		(118	)		192			680			886			858
PER SHARE OF COMMON STOCK
Diluted net income (loss)	$	(0.79	)	$	1.28		$	4.43		$	5.49		$	5.11
Cash dividends declared		0.20			2.31			2.56			2.36			2.20
Common shareholders' equity		31.82			33.31			34.12			32.70			31.11
Market value		29.57			19.85			43.53			58.68			56.76
Average diluted shares (in thousands)		149			149			154			161			168
YEAR-END BALANCES
Total assets	$	59,249		$	67,548		$	62,331		$	58,001		$	53,013
Total earning assets		54,558			62,374			57,448			54,052			48,646
Total loans		42,161			50,505			50,743			47,431			43,247
Total deposits		39,665			41,955			44,278			44,927			42,431
Total medium- and long-term debt		11,060			15,053			8,821			5,949			3,961
Total common shareholders' equity		4,878			5,023			5,117			5,153			5,068
Total shareholders' equity		7,029			7,152			5,117			5,153			5,068
AVERAGE BALANCES
Total assets	$	62,809		$	65,185		$	58,574		$	56,579		$	52,506
Total earning assets		58,162			60,422			54,688			52,291			48,232
Total loans		46,162			51,765			49,821			47,750			43,816
Total deposits		40,091			42,003			41,934			42,074			40,640
Total medium- and long-term debt		13,334			12,457			8,197			5,407			4,186
Total common shareholders' equity		4,959			5,166			5,070			5,176			5,097
Total shareholders' equity		7,099			5,442			5,070			5,176			5,097
CREDIT QUALITY
Total allowance for credit losses	$	1,022		$	808		$	578		$	519		$	549
Total nonperforming loans		1,181			917			404			214			138
Foreclosed property		111			66			19			18			24
Total nonperforming assets		1,292			983			423			232			162
Net credit-related charge-offs		869			472			153			72			116
Net credit-related charge-offs as a percentage of average total loans		1.88	%		0.91	%		0.31	%		0.15	%		0.26	%
Allowance for loan losses as a percentage of total period-end loans		2.34			1.52			1.10			1.04			1.19
Allowance for loan losses as a percentage of total nonperforming loans		83			84			138			231			373
RATIOS
Net interest margin		2.72	%		3.02	%		3.66	%		3.79	%		4.06	%
Return on average assets		0.03			0.33			1.17			1.58			1.64
Return on average common shareholders' equity		(2.37	)		3.79			13.52			17.24			16.90
Dividend payout ratio		N/M			179.07			57.79			42.99			43.05
Average common shareholders' equity as a percentage of average assets (a)		7.90			7.93			8.66			9.15			9.71
Tier 1 common capital as a percentage of risk-weighted assets (a)		8.18			7.08			6.85			7.54			7.78
Tier 1 capital as a percentage of risk-weighted assets		12.46			10.66			7.51			8.03			8.38
Tangible common equity as a percentage of tangible assets (a)		7.99			7.21			7.97			8.62			9.16

(a): See Supplemental Financial Data section for reconcilements of non-GAAP financial measures.

N/M — not meaningful.

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2009 FINANCIAL RESULTS AND KEY CORPORATE INITIATIVES

Financial Results

•: Net income was $17 million for 2009, compared to $213 million for 2008. The net loss attributable to common shares was $118 million for 2009, compared to net income attributable to common shares of $192 million for 2008. Included in the net income (loss) attributable to common shares were preferred dividends of $134 million and $17 million in 2009 and 2008, respectively. The net loss per diluted common share was $0.79 for 2009, compared to net income per diluted common share of $1.28 for 2008. In the first half of 2009, the national economy was hampered by turmoil in the financial markets, declining home values and a global recession. The most significant items contributing to the decrease in net income were an increase in the provision for loan losses of $396 million, a decline in net interest income of $248 million and an increase in Federal Deposit Insurance Corporation (FDIC) insurance expense of $74 million. These were partially offset by a $176 million increase in net securities gains, a $94 million decrease in salaries expense and an $88 million 2008 auction-rate securities charge.
•: Average loans in 2009 were $46.2 billion, a decrease of $5.6 billion from 2008. By geographic market, average loans declined in all geographic markets from 2008 to 2009: International (15 percent), Western (14 percent), Midwest (11 percent), Florida (eight percent), Other (eight percent) and Texas (five percent). Average loans declined in nearly all business lines, including declines in National Dealer Services (29 percent), Middle Market (14 percent), Specialty Businesses (13 percent), Commercial Real Estate (eight percent), Global Corporate Banking (seven percent) and Small Business (seven percent). The declines reflected reduced demand, consistent with previous post-recessionary environments.
•: Average deposits in 2009 were $40.1 billion, a decrease of $1.9 billion, or five percent, compared to 2008, resulting primarily from decreases of $2.6 billion, or 39 percent, in other time deposits and $1.3 billion, or nine percent, in money market and NOW deposits, partially offset by an increase of $2.3 billion, or 21 percent, in noninterest-bearing deposits in 2009, compared to 2008.
•: Net interest income declined $248 million to $1.6 billion in 2009, compared to 2008. The net interest margin decreased 30 basis points to 2.72 percent, primarily due to loan rates declining faster than deposit rates from late 2008 rate reductions, excess liquidity (represented by average balances deposited with the Federal Reserve Bank (FRB)) and the reduced contribution of noninterest-bearing funds in a significantly lower rate environment, partially offset by increased loan spreads. Excluding excess liquidity, the net interest margin would have been 2.83 percent for 2009, compared to 3.03 percent for 2008.
•: Noninterest income increased $157 million, or 18 percent, compared to 2008, largely due to a $176 million increase in net securities gains and a $36 million increase in deferred compensation asset returns (offset by an increase in deferred compensation plan costs in noninterest expenses), partially offset by decreases of $38 million in fiduciary income and $11 million in brokerage fees.
•: Noninterest expenses decreased $101 million, or six percent, compared to 2008, primarily due to decreases in salaries expense ($94 million), reflecting a decline in workforce and reduced incentives, deferred compensation plan costs ($36 million), the provision for credit losses on lending-related commitments ($18 million), discretionary expenses and an $88 million net charge in 2008 related to the repurchase of auction-rate securities (included in "litigation and operational expenses"), partially offset by increases in FDIC insurance expense ($74 million), other real estate expense ($38 million) and defined benefit pension expense ($37 million). Full-time equivalent employees decreased eight percent from year-end 2008 to year-end 2009.
•: Credit issues in 2009 resulted primarily from challenges in the Middle Market (primarily the Midwest and Western markets), Commercial Real Estate (Midwest, Florida, Texas and Western markets, primarily residential real estate developments), Global Corporate Banking (primarily the Western and International markets), Leasing (primarily the Midwest market) and Private Banking (primarily the Western and Midwest markets) loan portfolios. Commercial Real Estate challenges in the Western market moderated in 2009, compared to 2008, but remained a significant portion of Commercial Real

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Estate provisions and net charge-offs. Net credit-related charge-offs were 1.88 percent of average total loans in 2009, compared to 0.91 percent in 2008. Nonperforming assets increased to $1.3 billion, at year-end 2009, compared to $983 million at year-end 2008.

Key Corporate Initiatives

•: Aggressively focused significant resources on managing deteriorating credit quality in 2009, particularly in the commercial real estate portfolio. Within the commercial real estate loan portfolio in the Commercial Real Estate business line, year-end 2009 residential real estate development exposure was reduced by 44 percent, compared to year-end 2008.
•: Continued the loan optimization plan implemented in mid-2008, which increased loan spreads and enhanced customer relationship returns.
•: Increased average core deposits $973 million, or three percent, in 2009, compared to 2008. The increase in average core deposits included an increase in average noninterest-bearing deposits of $2.3 billion, or 21 percent, in 2009. Core deposits exclude other time deposits and foreign office time deposits.
•: Decreased noninterest expenses $101 million, or six percent, compared to full-year 2008, due to control of discretionary expenses and workforce. Reduced full-time equivalent staff by approximately 850, or eight percent, in 2009.
•: Continued to enhance capital ratios as the Tier 1 common capital and Tier 1 capital ratios were 8.18 percent and 12.46 percent, respectively, at December 31, 2009, up from 7.08 percent and 10.66 percent, respectively, at December 31, 2008.
•: Leveraged favorable market conditions to sell mortgage-backed government agency securities for $225 million of gains in 2009.
•: Continued organic growth focused in high growth markets, including opening 10 new banking centers in 2009. The Corporation expects to open 13 new banking centers in 2010 primarily in our growth markets of California, Texas and Arizona. The banking center expansion program for 2009 and planned program for 2010 was curtailed in comparison to earlier years due to the strained economic environment. Since the banking center expansion program began in late 2004, new banking centers have resulted in nearly $3.0 billion in new deposits.
•: At such time as feasible, redeem the $2.25 billion of Fixed Rate Cumulative Perpetual Preferred Stock issued to the U.S. Treasury, with careful consideration given to the economic environment.

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OVERVIEW

Comerica Incorporated (the Corporation) is a financial holding company headquartered in Dallas, Texas. The Corporation's major business segments are the Business Bank, the Retail Bank and Wealth & Institutional Management. The core businesses are tailored to each of the Corporation's four primary geographic markets: Midwest, Western, Texas and Florida.

The accounting and reporting policies of the Corporation and its subsidiaries conform to U.S. generally accepted accounting principles (GAAP) and prevailing practices within the banking industry. The Corporation's consolidated financial statements are prepared based on the application of accounting policies, the most significant of which are described in Note 1 to the consolidated financial statements. The most critical of these significant accounting policies are discussed in the "Critical Accounting Policies" section of this financial review.

As a financial institution, the Corporation's principal activity is lending to and accepting deposits from businesses and individuals. The primary source of revenue is net interest income, which is derived principally from the difference between interest earned on loans and investment securities and interest paid on deposits and other funding sources. The Corporation also provides other products and services that meet the financial needs of customers and which generate noninterest income, the Corporation's secondary source of revenue. Growth in loans, deposits and noninterest income is affected by many factors, including economic conditions in the markets the Corporation serves, the financial requirements and health of customers, and successfully adding new customers and/or increasing the number of products used by current customers. Success in providing products and services depends on the financial needs of customers and the types of products desired.

More than half of the Corporation's revenues are generated by the Business Bank business segment, making the Corporation highly sensitive to changes in the business environment in its primary geographic markets. To facilitate better balance among business segments and geographic markets, the Corporation opened 10 new banking centers in 2009 in markets with favorable demographics and plans to continue banking center expansion in these markets. This is expected to provide opportunity for growth across all business segments, especially in the Retail Bank and Wealth & Institutional Management segments, as the Corporation penetrates existing relationships through cross-selling and develops new relationships.

For 2010, management expects the following, compared to 2009, based on a modestly improving economic environment:

–: Management expects low single-digit period-end to period-end loan growth. Investment securities available-for-sale are expected to remain at a level similar to year-end 2009.
–: Based on no increase in the Federal Funds rate, management expects an average full-year net interest margin between 3.15 percent and 3.25 percent, reflecting the benefit, compared to full-year 2009, from improved loan pricing, lower funding costs and a lower level of excess liquidity.
–: Management expects full-year net credit-related charge-offs to decrease to between $775 million and $825 million. The provision for credit losses is expected to be slightly in excess of net charge-offs.
–: Management expects flat noninterest income, after excluding $243 million of 2009 net securities gains.
–: Management expects a low single-digit decrease in noninterest expenses.
–: Management expects income tax expense to approximate 35 percent of income before income taxes less approximately $60 million of permanent differences related to low-income housing and bank-owned life insurance.

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ANALYSIS OF NET INTEREST INCOME

Fully Taxable Equivalent (FTE)

			Years Ended December 31

			2009								2008								2007
			Average Balance			Interest		Average Rate			Average Balance			Interest		Average Rate			Average Balance			Interest			Average Rate
			(dollar amounts in millions)
Commercial loans (a)(b)			$	24,534		$	890		3.63	%	$	28,870		$	1,468		5.08	%	$	28,132		$	2,038			7.25	%
Real estate construction loans				4,140			121		2.92			4,715			231		4.89			4,552			374			8.21
Commercial mortgage loans				10,415			437		4.20			10,411			580		5.57			9,771			709			7.26
Residential mortgage loans				1,756			97		5.53			1,886			112		5.94			1,814			111			6.13
Consumer loans				2,553			94		3.68			2,559			130		5.08			2,367			166			7.00
Lease financing (c)				1,231			40		3.25			1,356			8		0.59			1,302			40			3.04
International loans				1,533			58		3.79			1,968			101		5.13			1,883			133			7.06
Business loan swap income (expense) (d)				—			34		—			—			24		—			—			(67	)		—

	Total loans (b)(e)			46,162			1,771		3.84			51,765			2,654		5.13			49,821			3,504			7.03
Auction-rate securities available-for-sale				1,010			15		1.47			193			6		2.95			—			—			—
Other investment securities available-for-sale				8,378			318		3.88			7,908			384		4.88			4,447			206			4.56

	Total investment securities available-for-sale (f)			9,388			333		3.61			8,101			390		4.83			4,447			206			4.56
Federal funds sold and securities purchased under agreements to resell				18			—		0.32			93			2		2.08			164			9			5.28
Interest-bearing deposits with banks (g)				2,440			6		0.25			219			1		0.61			15			1			4.00
Other short-term investments				154			3		1.74			244			10		3.98			241			13			5.75

	Total earning assets			58,162			2,113		3.64			60,422			3,057		5.06			54,688			3,733			6.82
Cash and due from banks				883								1,185								1,352
Allowance for loan losses				(947	)							(691	)							(520	)
Accrued income and other assets				4,711								4,269								3,054

	Total assets		$	62,809							$	65,185							$	58,574

Money market and NOW deposits (a)			$	12,965			63		0.49		$	14,245			207		1.45		$	14,937			460			3.08
Savings deposits				1,339			2		0.11			1,344			6		0.45			1,389			13			0.93
Customer certificates of deposit				8,131			183		2.26			8,150			263		3.23			7,687			342			4.45

	Total interest-bearing core deposits			22,435			248		1.11			23,739			476		2.01			24,013			815			3.39
Other time deposits (d)(h)				4,103			121		2.96			6,715			232		3.45			5,563			300			5.39
Foreign office time deposits (i)				653			2		0.29			926			26		2.77			1,071			52			4.85

	Total interest-bearing deposits			27,191			371		1.37			31,380			734		2.34			30,647			1,167			3.81
Short-term borrowings				1,000			2		0.24			3,763			87		2.30			2,080			105			5.06
Medium- and long-term debt (d)(h)				13,334			165		1.23			12,457			415		3.33			8,197			455			5.55

	Total interest-bearing sources			41,525			538		1.29			47,600			1,236		2.59			40,924			1,727			4.22

Noninterest-bearing deposits (a)				12,900								10,623								11,287
Accrued expenses and other liabilities				1,285								1,520								1,293
Total shareholders' equity				7,099								5,442								5,070

	Total liabilities and shareholders' equity		$	62,809							$	65,185							$	58,574

Net interest income/rate spread (FTE)						$	1,575		2.35					$	1,821		2.47					$	2,006			2.60

FTE adjustment (j)						$	8							$	6							$	3

Impact of net noninterest-bearing sources of funds									0.37								0.55									1.06

Net interest margin (as a percentage of average earning assets (FTE) (b)(c)(g)									2.72	%							3.02	%								3.66	%


(a)		FSD balances included above:
		Loans (primarily low-rate)	$	210		$	3		1.65	%	$	498		$	7		1.40	%	$	1,318		$	9			0.69	%
		Interest-bearing deposits		448			2		0.54			957			19		1.99			1,202			47			3.91
		Noninterest-bearing deposits		1,306								1,643								2,836
(b)		Impact of FSD loans (primarily low-rate) on the following:
		Commercial loans							(0.02	)%							(0.07	)%								(0.32	)%
		Total loans							(0.01	)							(0.03	)								(0.18	)
		Net interest margin (FTE) (assuming loans were funded by noninterest-bearing deposits)							—								(0.01	)								(0.08	)
(c)		2008 net interest income declined $38 million and the net interest margin declined six basis points due to tax-related non-cash
		lease income charges. Excluding these charges, the net interest margin would have been 3.08%.
(d)		The gain or loss attributable to the effective portion of cash flow hedges of loans is shown in "Business loan swap income (expense)". The gain or loss attributable to the effective portion of fair value hedges of other time deposits and medium- and long-term debt, which totaled a net gain of $61 million in 2009, is included in the related interest expense line item.
(e)		Nonaccrual loans are included in average balances reported and are used to calculate rates.
(f)		Average rate based on average historical cost.
(g)		Excess liquidity, represented by average balances deposited with the Federal Reserve Bank, reduced the net interest margin by 11 basis points and one basis point in 2009 and 2008, respectively, and had no impact on the net interest margin in 2007. Excluding excess liquidity, the net interest margin would have been 2.83% in 2009 and 3.03% in 2008.
(h)		Other time deposits and medium- and long-term debt average balances have been adjusted to reflect the gain or loss attributable to the risk hedged by risk management swaps that qualify as fair value hedges.
(i)		Includes substantially all deposits by foreign domiciled depositors; deposits are primarily in excess of $100,000.
(j)		The FTE adjustment is computed using a federal income tax rate of 35%.

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RATE-VOLUME ANALYSIS
Fully Taxable Equivalent (FTE)

			2009/2008									2008/2007

			Increase (Decrease) Due to Rate			Increase (Decrease) Due to Volume (a)			Net Increase (Decrease)			Increase (Decrease) Due to Rate			Increase (Decrease) Due to Volume (a)			Net Increase (Decrease)
			(in millions)
Interest income (FTE):
Loans:
	Commercial loans		$	(421	)	$	(157	)	$	(578	)	$	(608	)	$	38		$	(570	)
	Real estate construction loans			(93	)		(17	)		(110	)		(151	)		8			(143	)
	Commercial mortgage loans			(143	)		—			(143	)		(165	)		36			(129	)
	Residential mortgage loans			(8	)		(7	)		(15	)		(3	)		4			1
	Consumer loans			(36	)		—			(36	)		(46	)		10			(36	)
	Lease financing			36			(4	)		32			(32	)		—			(32	)
	International loans			(26	)		(17	)		(43	)		(36	)		4			(32	)
	Business loan swap income (expense)			10			—			10			91			—			91

		Total loans		(681	)		(202	)		(883	)		(950	)		100			(850	)
Auction-rate securities available-for-sale				(3	)		12			9			—			6			6
Other investment securities available-for-sale				(84	)		18			(66	)		10			168			178

		Total investment securities available-for-sale		(87	)		30			(57	)		10			174			184
Federal funds sold and securities purchased under agreements to resell				(2	)		—			(2	)		(5	)		(2	)		(7	)
Interest-bearing deposits with banks				(1	)		6			5			(1	)		1			—
Other short-term investments				(2	)		(5	)		(7	)		(4	)		1			(3	)

		Total interest income (FTE)		(773	)		(171	)		(944	)		(950	)		274			(676	)
Interest expense:
Interest-bearing deposits:
	Money market and NOW accounts			(138	)		(6	)		(144	)		(242	)		(11	)		(253	)
	Savings deposits			(4	)		—			(4	)		(7	)		—			(7	)
	Customer certificates of deposit			(79	)		(1	)		(80	)		(94	)		15			(79	)
	Other time deposits			(34	)		(77	)		(111	)		(108	)		40			(68	)
	Foreign office time deposits			(23	)		(1	)		(24	)		(22	)		(4	)		(26	)

		Total interest-bearing deposits		(278	)		(85	)		(363	)		(473	)		40			(433	)
Short-term borrowings				(78	)		(7	)		(85	)		(57	)		39			(18	)
Medium- and long-term debt				(262	)		12			(250	)		(182	)		142			(40	)

		Total interest expense		(618	)		(80	)		(698	)		(712	)		221			(491	)

		Net interest income (FTE)	$	(155	)	$	(91	)	$	(246	)	$	(238	)	$	53		$	(185	)

(a): Rate/volume variances are allocated to variances due to volume.

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NET INTEREST INCOME

Net interest income is the difference between interest and yield-related fees earned on assets and interest paid on liabilities. Adjustments are made to the yields on tax-exempt assets in order to present tax-exempt income and fully taxable income on a comparable basis. Gains and losses related to the effective portion of risk management interest rate swaps that qualify as hedges are included with the interest income or expense of the hedged item when classified in net interest income. Net interest income on a fully taxable equivalent (FTE) basis comprised 60 percent of total revenues in 2009, compared to 67 percent in 2008 and 69 percent in 2007. The "Analysis of Net Interest Income-Fully Taxable Equivalent" table of this financial review provides an analysis of net interest income for the years ended December 31, 2009, 2008 and 2007. The rate-volume analysis in the table above details the components of the change in net interest income on a FTE basis for 2009, compared to 2008, and 2008, compared to 2007.

Net interest income was $1.6 billion in 2009, a decrease of $248 million, or 14 percent, compared to $1.8 billion in 2008. The decrease in net interest income in 2009 was primarily due to loan rates declining faster than deposit rates with late 2008 rate reductions, partially offset by increased loan spreads. On a FTE basis, net interest income was $1.6 billion in 2009, a decrease of $246 million, or 13 percent, from 2008. The net interest margin (FTE) decreased to 2.72 percent in 2009, from 3.02 percent in 2008, resulting primarily from the reasons cited for the decline in net interest income discussed above, as well as excess liquidity and the reduced contribution of noninterest-bearing funds in a significantly lower rate environment. The net interest margin was reduced by approximately 11 basis points in 2009 from excess liquidity, represented by $2.4 billion of average balances deposited with the FRB. The excess liquidity resulted from strong core deposit growth at a time when loan demand remained weak. Average earning assets decreased $2.2 billion, or four percent, to $58.2 billion in 2009, compared to 2008, primarily as a result of a $5.6 billion decrease in average loans, partially offset by increases of $2.2 billion in average interest-bearing deposits with the FRB and $1.3 billion in average investment securities available-for-sale.

The Corporation implements various asset and liability management tactics to manage net interest income exposure to interest rate risk. Refer to the "Interest Rate Risk" section of this financial review for additional information regarding the Corporation's asset and liability management policies.

In 2008, net interest income was $1.8 billion, a decrease of $188 million, or nine percent, from 2007. The decrease in net interest income in 2008 was primarily due to a decrease in loan portfolio yields, a competitive environment for deposit pricing, the impact of a higher level of nonaccrual loans and $38 million of tax-related non-cash charges to lease income, partially offset by growth in average earnings assets, largely driven by growth in investment securities available-for-sale. The lease income charges reflected the reversal of previously recognized income resulting from projected changes in the timing of income tax cash flows on certain structured leasing transactions and will fully reverse over the remaining lease terms. (Further information about the charges can be found in Note 20 to the consolidated financial statements). In 2008, net interest income (FTE) was $1.8 billion, a decrease of $185 million, or nine percent, from 2007. The net interest margin (FTE) decreased to 3.02 percent in 2008, from 3.66 percent in 2007, resulting primarily from the reasons cited for the decline in net interest income discussed above, and as a result of the change in the mix of both earning assets, driven by growth in investment securities available-for-sale, and interest-bearing sources of funds. The 2008 lease income charges discussed above reduced the net interest margin by six basis points. Average earning assets increased $5.7 billion, or 10 percent, to $60.4 billion in 2008, compared to 2007, primarily as a result of a $3.7 billion increase in average investment securities available-for-sale and a $1.9 billion increase in average loans.

Based on no increase in the Federal Funds rate, management expects an average full-year 2010 net interest margin between 3.15 percent and 3.25 percent, reflecting the benefit, compared to full-year 2009, from improved loan pricing, lower funding costs and a lower level of excess liquidity.

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PROVISION FOR CREDIT LOSSES

The provision for credit losses includes both the provision for loan losses and the provision for credit losses on lending-related commitments. The provision for loan losses reflects management's evaluation of the adequacy of the allowance for loan losses. The allowance for loan losses represents management's assessment of probable losses inherent in the Corporation's loan portfolio. The provision for credit losses on lending-related commitments, a component of "noninterest expenses" on the consolidated statements of income, reflects management's assessment of the adequacy of the allowance for credit losses on lending-related commitments. The allowance for credit losses on lending-related commitments, which is included in "accrued expenses and other liabilities" on the consolidated balance sheets, covers probable credit-related losses inherent in credit-related commitments, including letters of credit and financial guarantees. The Corporation performs a detailed credit quality review quarterly to determine the adequacy of both allowances. For a further discussion of both the allowance for loan losses and the allowance for credit losses on lending-related commitments, refer to the "Credit Risk" and the "Critical Accounting Policies" sections of this financial review.

The provision for loan losses was $1.1 billion in 2009, compared to $686 million in 2008 and $212 million in 2007. The $396 million increase in the provision for loan losses in 2009, compared to 2008, resulted primarily from challenges in the Middle Market (primarily the Midwest and Western markets), Commercial Real Estate in the Midwest, Florida and Texas markets (primarily residential real estate developments), Global Corporate Banking (primarily the Western and International markets), Leasing (primarily the Midwest market) and Private Banking (primarily the Western and Midwest markets) loan portfolios. Commercial Real Estate challenges in the Western market moderated in 2009, compared to 2008, but remained a significant portion of the Commercial Real Estate provision for loan losses. In the first half of 2009, the national economy was hampered by turmoil in the financial markets, declining home values and a global recession. Signs of growth in the national economy began in the third quarter of 2009, as the credit and capital markets began functioning at a more normal level and the housing market began to stabilize. The Michigan economy contracted sharply in the first half of 2009, but has recently shown signs of leveling off. The average Michigan Business Activity Index compiled by the Corporation for January through November 2009 declined 15 percent, compared to the average for the full-year 2008. However, the November 2009 index rebounded by nine percent from a low reached in May 2009, with particular strength noted in automotive and steel production. The Michigan Business Activity index represents nine different measures of Michigan economic activity compiled by the Corporation. The California economy continues to lag moderately behind the national economy, with ongoing declines in construction and the state's budget problems more severe than in most other states. However, the California Economic Activity Index compiled by the Corporation is signaling that a recovery is developing. The November 2009 index was up 12 percent from a low reached in March 2009, with all components of the index contributing to the upturn except nonfarm payrolls. The California Economic Activity Index equally weights nine, seasonally-adjusted coincident indicators of real economic activity compiled by the Corporation. A wide variety of economic reports indicate that Texas continued to outperform the nation in 2009. The Texas economy began contracting following the financial market turmoil in the fall of 2008, but has experienced a much more modest reduction in homebuilding than most other states, and the state's manufacturing sector is beginning to revive as domestic and export demand is on the rise. However, the state's energy sector was hit hard by the sharp drop in crude oil and natural gas prices. Forward-looking indicators suggest that economic conditions in the Corporation's primary geographic markets are likely to strengthen gradually as moderate national and global recoveries continue to develop. The increase in the provision for loan losses in 2008, when compared to 2007, was primarily the result of challenges in the residential real estate development business located in the Western market (primarily California) and to a lesser extent in the Middle Market and Small Business loan portfolios.

The provision for credit losses on lending-related commitments was a charge of less than $0.5 million in 2009, compared to a charge of $18 million in 2008 and a negative provision of $1 million in 2007. The $18 million decrease in the provision for credit losses on lending-related commitments in 2009, compared to 2008, resulted primarily from the cancellation and drawdown of letters of credit in the Midwest market and a reduction in unfunded commitment levels. The $19 million increase in 2008, compared to 2007, was primarily

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the result of an increase in specific reserves related to unused commitments extended to customers in the Commercial Real Estate business line in the Michigan and Western markets (largely residential real estate developments) and standby letters of credit extended to customers in the Michigan commercial real estate industry. An analysis of the changes in the allowance for credit losses on lending-related commitments is presented in the "Credit Risk" section of this financial review.

Net loan charge-offs in 2009 increased $397 million to $868 million, or 1.88 percent of average total loans, compared to $471 million, or 0.91 percent, in 2008 and $149 million, or 0.30 percent, in 2007. Total net credit-related charge-offs, which includes net charge-offs on both loans and lending-related commitments, were $869 million, or 1.88 percent of average total loans, in 2009, compared to $472 million, or 0.91 percent, in 2008 and 153 million, or 0.31 percent, in 2007. The $397 million increase in net credit-related charge-offs in 2009, compared to 2008, resulted primarily from increases in net credit-related charge-offs in the Middle Market ($133 million), Commercial Real Estate ($70 million), Global Corporate Banking ($55 million), Small Business ($41 million) and Leasing ($38 million) loan portfolios. By geographic market, net credit-related charge-offs in the Midwest and Western markets increased $199 million and $86 million, respectively, in 2009, compared to 2008. An analysis of the changes in the allowance for loan losses, including charge-offs and recoveries by loan category, is presented in the "Analysis of the Allowance for Loan Losses" table in the "Risk Management" section of this financial review. An analysis of the changes in the allowance for credit losses on lending-related commitments is presented in the "Credit Risk" section of this financial review.

Management expects full-year 2010 net credit-related charge-offs to decrease to between $775 million and $825 million. The provision for credit losses is expected to be slightly in excess of net charge-offs.

NONINTEREST INCOME

		Years Ended December 31

		2009		2008		2007
		(in millions)
Service charges on deposit accounts		$	228	$	229	$	221
Fiduciary income			161		199		199
Commercial lending fees			79		69		75
Letter of credit fees			69		69		63
Card fees			51		58		54
Foreign exchange income			41		40		40
Bank-owned life insurance			35		38		36
Brokerage fees			31		42		43
Net securities gains			243		67		7
Other noninterest income			112		82		150

	Total noninterest income	$	1,050	$	893	$	888

Noninterest income increased $157 million, or 18 percent, to $1.1 billion in 2009, compared to $893 million in 2008, and increased $5 million, or less than one percent, in 2008, compared to $888 million in 2007. Excluding net securities gains, noninterest income decreased two percent in 2009, compared to 2008, and six percent in 2008, compared to 2007. An analysis of increases and decreases by individual line item is presented below.

Service charges on deposit accounts decreased $1 million, or less than one percent, to $228 million in 2009, compared to $229 million in 2008, and increased $8 million, or three percent, in 2008, compared to $221 million in 2007. The increase in 2008 was primarily due to lower earnings credit allowances provided on deposit balances to business customers as a result of the interest rate environment.

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Fiduciary income decreased $38 million, or 19 percent, to $161 million in 2009, compared to $199 million in 2008, and was unchanged in 2008, compared to 2007. Personal and institutional trust fees are the two major components of fiduciary income. These fees are based on services provided and assets managed. Fluctuations in the market values of the underlying assets managed, which include both equity and fixed income securities, impact fiduciary income. The decrease in 2009 was primarily due to lower personal trust fees related to market value decline in late 2008 and a decline in institutional trust fees related to the sale of the Corporation's proprietary defined contribution plan recordkeeping business in the second quarter 2009. In 2008, lower fees related to market value decline were offset by net new business.

Commercial lending fees increased $10 million, or 14 percent, to $79 million in 2009, compared to a decrease of $6 million, or eight percent, in 2008. The majority of the increase in 2009 resulted from increased risk-adjusted pricing on unused commercial loan commitments. The decrease in 2008 resulted from lower participation fees and lower unused commercial loan commitments.

Letter of credit fees of $69 million were unchanged in 2009, compared to an increase of $6 million, or 10 percent, in 2008. The increase in 2008 was principally due to one-time adjustments related to the timing of recognition of letter of credit fees.

Card fees, which consist primarily of interchange fees earned on debit and commercial cards, decreased $7 million, or 13 percent, to $51 million in 2009, compared to $58 million in 2008, and increased $4 million, or nine percent, in 2008, compared to $54 million in 2007. The decline in 2009 resulted primarily from lower levels of retail and commercial card business activity. Growth in 2008 resulted primarily from an increase in transaction volume caused by the continued shift to electronic banking, new customer accounts and new products.

Foreign exchange income increased $1 million, or one percent, to $41 million in 2009, compared to $40 million in both 2008 and 2007.

Bank-owned life insurance income decreased $3 million, or eight percent, to $35 million in 2009, compared to an increase of $2 million, to $38 million in 2008. The decrease in 2009 resulted primarily from a decrease in death benefits received and reduced earnings on bank-owned life insurance policies. The increase in 2008 resulted primarily from an increase in death benefits received.

Brokerage fees of $31 million decreased $11 million, or 25 percent, in 2009, compared to a decrease of $1 million to $42 million in 2008. Brokerage fees include commissions from retail brokerage transactions and mutual fund sales and are subject to changes in the level of market activity. The decreases in 2009 and 2008 were primarily due to lower transaction and dollar volumes as a result of depressed market conditions.

Net securities gains increased $176 million, to $243 million in 2009, compared to an increase of $60 million, to $67 million in 2008. The increase in 2009 resulted primarily from gains on the sale of mortgage-backed government agency securities ($225 million) and gains on the redemption of auction-rate securities ($14 million), compared to gains resulting from the sales of the Corporation's ownership of Visa ($48 million) and MasterCard shares ($14 million) in 2008. Mortgage-backed government agency securities were sold in 2009 as market conditions were favorable and there was no longer a need to hold a large portfolio of fixed-rate securities to mitigate the impact of potential future rate declines on net interest income.

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Other noninterest income increased $30 million, or 37 percent, in 2009, compared to a decrease of $69 million, or 46 percent, in 2008. The following table illustrates fluctuations in certain categories included in "other noninterest income" on the consolidated statements of income.

		Years Ended December 31

		2009			2008			2007
		(in millions)
Other noninterest income
	Gain on repurchase of debt	$	15		$	—		$	—
	Deferred compensation asset returns (a)		10			(26	)		7
	Net gain on termination of leveraged leases		8			—			—
	Net gain on sales of businesses		5			—			3
	Gain on sale of SBA loans		—			5			14
	Risk management hedge gains (losses) from interest rate and foreign exchange contracts		(6	)		8			3
	Net income (loss) from principal investing and warrants		(6	)		(10	)		19
	Amortization of low income housing investments		(44	)		(42	)		(33	)

(a): Compensation deferred by the Corporation's officers is invested in stocks and bonds to reflect the investment selections of the officers. Income (loss) earned on these assets is reported in noninterest income and the offsetting increase (decrease) in the liability is reported in salaries expense.

Management expects flat noninterest income, after excluding $243 million of 2009 securities gains, in 2010, compared to 2009 levels.

NONINTEREST EXPENSES

		Years Ended December 31

		2009		2008		2007
		(in millions)
Salaries		$	687	$	781	$	844
Employee benefits			210		194		193

	Total salaries and employee benefits		897		975		1,037
Net occupancy expense			162		156		138
Equipment expense			62		62		60
Outside processing fee expense			97		104		91
FDIC Insurance expense			90		16		5
Software expense			84		76		63
Other real estate expense			48		10		7
Legal fees			37		29		24
Litigation and operational losses			10		103		18
Customer services			4		13		43
Provision for credit losses on lending-related commitments			—		18		(1	)
Other noninterest expenses			159		189		206

	Total noninterest expenses	$	1,650	$	1,751	$	1,691

Noninterest expenses decreased $101 million, or six percent, to $1,650 million in 2009, compared to $1,751 million in 2008, and increased $60 million, or four percent, in 2008, from $1,691 million in 2007. Excluding an $88 million net charge related to the repurchase of auction-rate securities from certain customers in 2008, noninterest expenses decreased $13 million, or one percent, in 2009, compared to 2008. An analysis of increases and decreases by individual line item is presented below.

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The following table summarizes the various components of salaries and employee benefits expense.

			Years Ended December 31

			2009		2008			2007
			(in millions)
Salaries
	Regular salaries (including contract labor)		$	570	$	609		$	635
	Severance			14		29			4
	Incentives (including commissions)			60		117			138
	Deferred compensation plan costs			11		(25	)		8
	Share-based compensation			32		51			59

		Total salaries		687		781			844
Employee benefits
	Defined benefit pension expense			57		20			36
	Severance-related benefits			3		5			—
	Other employee benefits			150		169			157

		Total employee benefits		210		194			193

		Total salaries and employee benefits	$	897	$	975		$	1,037

Salaries expense decreased $94 million, or 12 percent, in 2009, compared to a decrease of $63 million, or seven percent, in 2008. The decrease in 2009 was primarily due to decreases in business unit and executive incentives ($57 million), regular salaries ($39 million), share-based compensation ($19 million) and severance ($15 million), partially offset by an increase in deferred compensation plan costs ($36 million). Business unit incentives are tied to new business and business unit profitability, while executive incentives are tied to the Corporation's overall performance and peer-based comparisons of results. The decrease in regular salaries in 2009 was primarily the result of a decrease in staff of approximately 850 full-time equivalent employees from year-end 2008 to year-end 2009. The increase in deferred compensation plan costs in 2009 was offset by increased deferred compensation asset returns in noninterest income. The decrease in salaries expense in 2008 was primarily due to decreases in deferred compensation plan costs ($33 million), regular salaries ($26 million), incentives ($21 million) and share-based compensation ($8 million), partially offset by an increase in severance expense ($25 million). The decrease in regular salaries in 2008 was primarily the result of the refinement to the deferral of costs associated with loan origination, as described in Note 1 to the consolidated financial statements, and a decrease in staff of approximately 600 full-time equivalent employees from year-end 2007 to year-end 2008.

Employee benefits expense increased $16 million, or eight percent, in 2009, compared to an increase of $1 million, or one percent, in 2008. The increase in 2009 resulted primarily from an increase in defined benefit pension expense. In 2008, when compared to 2007, increases in staff insurance costs and severance-related benefits, were substantially offset by a decline in defined benefit pension expense. For a further discussion of defined benefit pension expense, refer to the "Critical Accounting Policies" section of this financial review and Note 19 to the consolidated financial statements.

Net occupancy and equipment expense increased $6 million, or three percent, to $224 million in 2009, compared to an increase of $20 million, or 10 percent, in 2008. Net occupancy and equipment expense increased $7 million and $11 million in 2009 and 2008, respectively, due to the addition of new banking centers since the banking center expansion program began in late 2004.

Outside processing fee expense decreased $7 million, or seven percent, to $97 million in 2009, from $104 million in 2008, compared to an increase of $13 million, or 13 percent, in 2008. The decrease in 2009 was largely due to lower volumes in activity-based processing charges resulting from the sale of the Corporation's proprietary defined contribution plan recordkeeping business. The increase in 2008 was due to higher volumes in activity-based processing charges, in part related to outsourcing.

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FDIC insurance expense increased $74 million to $90 million in 2009, compared to an increase of $11 million in 2008. The increase in 2009 was primarily due to a second quarter 2009 industry-wide special assessment charge ($29 million), an increase in base assessment rates and a surcharge related to the Corporation's participation in the Temporary Liquidity Guarantee Program. For additional information regarding the Temporary Liquidity Guarantee Program, refer to the "Deposits and Borrowed Funds" portion of the "Balance Sheet and Capital Funds Analysis" section of this financial review. The increase in 2008 reflected the exhaustion of a one-time credit against which deposit insurance assessments had been applied from 2007 through mid-2008.

Software expense increased $8 million, or 10 percent, in 2009, compared to an increase of $13 million, or 21 percent, in 2008. The increase in 2009 was mostly due to a full year of amortization expense for investments in technology throughout 2008. The increase in 2008 was primarily due to increased investments in technology, including treasury management, sales tracking tools, anti-money laundering initiatives, transition from paper to electronic check processing and the continued development of loan portfolio and enterprise level analytical tools, combined with an increase in maintenance costs.

Other real estate expenses increased $38 million to $48 million in 2009, from $10 million in 2008, and increased $3 million in 2008, compared to 2007. Other real estate expenses reflects write-downs, net gains (losses) on sales and carrying costs related primarily to foreclosed property. The increase in 2009 was primarily due to write-downs on foreclosed property of $34 million in 2009 reflecting continued declines in property values. For additional information regarding foreclosed property, refer to the "Nonperforming Assets" portion of the "Credit Risk" section of this financial review.

Legal fees increased $8 million to $37 million in 2009, from $29 million in 2008, and increased $5 million in 2008, compared to 2007. The increase in 2009 was primarily due to increased loan workout and collection expenses, partially offset by lower other litigation expenses.

Litigation and operational losses decreased $93 million to $10 million in 2009, from $103 million in 2008, and increased $85 million in 2008, compared to $18 million in 2007. Litigation and operational losses include traditionally defined operating losses, such as fraud and processing losses, as well as uninsured losses and litigation losses. These expenses are subject to fluctuation due to timing of authorized and actual litigation settlements, as well as insurance settlements. Litigation and operational losses in 2008 included a net charge of $88 million related to the repurchase of auction-rate securities from certain customers, partially offset by a 2008 reversal of a $13 million loss sharing expense related to the Corporation's membership in Visa recognized in 2007. For additional information on the repurchase of auction-rate securities, refer to the "Investment Securities Available-for-Sale" portion of the "Balance Sheet and Capital Funds Analysis" section and "Critical Accounting Policies" section of this financial review and Note 4 to the consolidated financial statements.

Customer services expense decreased $9 million, or 71 percent, to $4 million in 2009, from $13 million in 2008, and decreased $30 million, or 69 percent, in 2008, from $43 million in 2007. Customer services expense represents certain expenses paid on behalf of particular customers, and is one method to attract and retain title and escrow deposits in the Financial Services Division. The amount of customer services expense varies from period to period as a result of changes in the level of noninterest-bearing deposits and low-rate loans in the Financial Services Division and the earnings credit allowances provided on these deposits, as well as the competitive environment. Average Financial Services Division noninterest-bearing deposits and loans decreased $337 million and $288 million, in 2009, compared to 2008, respectively.

The provision for credit losses on lending-related commitments decreased $18 million to a charge of less than $0.5 million in 2009, from a charge of $18 million in 2008, and increased $19 million in 2008, compared to a negative provision of $1 million in 2007. For additional information on the provision for credit losses on lending-related commitments, refer to the "Provision for Credit Losses" section of this financial review and Note 1 to the consolidated financial statements.

Other noninterest expenses decreased $30 million, or 15 percent, in 2009, and decreased $17 million, or eight percent, in 2008. The decrease in 2009 was due in part to a decrease of $11 million, or 40 percent, in travel and entertainment expenses. The decrease in 2008 was due to nominal decreases in several categories.

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Management expects a low single-digit decrease in noninterest expenses in 2010 compared to 2009 levels.

INCOME TAXES AND TAX-RELATED ITEMS

The provision for income taxes was a benefit of $131 million in 2009, compared to provisions of $59 million in 2008 and $306 million in 2007. The income tax benefit in 2009 reflected the decrease in income before taxes compared to 2008 and a benefit of $14 million related to the settlement of certain tax matters due to the audit of years 2001-2004, the filing of certain amended state tax returns and the reduction of tax interest due to anticipated refunds due from the Internal Revenue Service (IRS). The provision for income taxes in 2008 reflected the impact of lower pre-tax income compared to 2007 and included a net after-tax charge of $9 million related to the acceptance of a global settlement offered by the IRS on certain structured leasing transactions, settlement with the IRS on disallowed foreign tax credits related to a series of loans to foreign borrowers and other tax adjustments.

The Corporation had a net deferred tax asset of $158 million at December 31, 2009. Included in net deferred taxes at December 31, 2009 were deferred tax assets of $678 million, net of a $1 million valuation allowance established for certain state deferred tax assets. A valuation allowance is provided when it is "more-likely-than-not" that some portion of the deferred tax asset will not be realized. Deferred tax assets are evaluated for realization based on available evidence of loss carryback capacity, projected future reversals of existing taxable temporary differences and assumptions made regarding future events.

Management expects 2010 income tax expense to approximate 35 percent of income before income taxes less approximately $60 million of permanent differences related to low-income housing and bank-owned life insurance.

INCOME FROM DISCONTINUED OPERATIONS, NET OF TAX

Income from discontinued operations, net of tax, was $1 million in both 2009 and 2008 and $4 million in 2007. Income from discontinued operations in 2007 included adjustments to the initial gain recorded on the sale of Munder Capital Management (Munder) in 2006. For further information on the sale of Munder and discontinued operations, refer to Note 26 to the consolidated financial statements.

PREFERRED STOCK DIVIDENDS

In the fourth quarter 2008, the Corporation participated in the U.S. Department of Treasury (U.S. Treasury) Capital Purchase Program (the Capital Purchase Program) and received proceeds of $2.25 billion from the U. S. Treasury. In return, the Corporation issued 2.25 million shares of Fixed Rate Cumulative Perpetual Preferred Stock, Series F, without par value (preferred shares) and granted a warrant to purchase 11.5 million shares of common stock to the U.S. Treasury. The preferred shares pay a cumulative dividend rate of five percent per annum on the liquidation preference of $1,000 per share.

The proceeds from the Capital Purchase Program were allocated between the preferred shares and the related warrant based on relative fair value, which resulted in an initial carrying value of $2.1 billion for the preferred shares and $124 million for the warrant. The resulting discount to the preferred shares of $124 million accretes on a level yield basis over five years through November 2013 and is being recognized as additional preferred stock dividends.

Preferred stock dividends were $134 million for the year ended December 31, 2009, which included $112 million of cash dividends and $22 million of discount accretion. Preferred stock dividends, including accretion of the discount, were $17 million for the fourth quarter 2008 and the year ended December 31, 2008.

For further information on the Capital Purchase Program, refer to the "Capital" section of this financial review and Note 15 to the consolidated financial statements.

At such time as feasible, management intends to redeem the $2.25 billion of Fixed Rate Cumulative Perpetual Preferred Stock issued to the U.S. Treasury, with careful consideration given to the economic environment.

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STRATEGIC LINES OF BUSINESS

BUSINESS SEGMENTS

The Corporation's operations are strategically aligned into three major business segments: the Business Bank, the Retail Bank and Wealth & Institutional Management. These business segments are differentiated based upon the products and services provided. In addition to the three major business segments, the Finance Division is also reported as a segment. The Other category includes discontinued operations and items not directly associated with these business segments or the Finance Division. Note 24 to the consolidated financial statements describes the business activities of each business segment and the methodologies which form the basis for these results, and presents financial results of these business segments for the years ended December 31, 2009, 2008 and 2007.

The following table presents net income (loss) by business segment.

		Years Ended December 31

		2009					2008					2007
		(dollar amounts in millions)
Business Bank		$	147		104	%	$	237		89	%	$	516		72	%
Retail Bank			(48	)	(34	)		34		13			128		18
Wealth & Institutional Management (a)			43		30			(4	)	(2	)		70		10

			142		100	%		267		100	%		714		100	%
Finance			(110	)				(48	)				(38	)
Other (b)			(15	)				(6	)				10

	Total	$	17				$	213				$	686

(a): 2008 included an $88 million net charge ($56 million, after-tax) related to the repurchase of auction-rate securities from customers.
(b): Includes discontinued operations and items not directly associated with the three major business segments or the Finance Division.

The Business Bank's net income decreased $90 million, or 38 percent, to $147 million in 2009, compared to a decrease of $279 million, or 54 percent, to $237 million in 2008. Net interest income (FTE) was $1.3 billion in 2009, an increase of $51 million, or four percent, compared to 2008. The increase in net interest income (FTE) was primarily due to an increase in loan spreads and a $402 million increase in average deposits, partially offset by a $5.5 billion decrease in average loans. The provision for loan losses increased $317 million to $860 million in 2009, from $543 million in 2008, primarily due to increases in reserves for the Middle Market, Commercial Real Estate (in the Midwest, Florida and Texas markets), Leasing and Global Corporate Banking loan portfolios, partially offset by a reduction in reserves for Western residential real estate developers (primarily in California). Net credit-related charge-offs of $712 million increased $320 million, primarily due to an increase in charge-offs in the Middle Market, Commercial Real Estate, Global Corporate Banking, Small Business and Leasing loan portfolios. Noninterest income of $291 million in 2009 decreased $11 million from 2008, primarily due to a $14 million gain on the sale of MasterCard shares in 2008 and decreases in income from customer derivatives ($11 million), card fees ($7 million) and investment banking fees ($5 million), partially offset by increases in warrant income ($9 million), commercial lending fees ($7 million) and service charges on deposits ($5 million), and an $8 million 2009 net gain on the termination of leveraged leases. Noninterest expenses of $638 million in 2009 decreased $71 million from 2008, primarily due to decreases in allocated net corporate overhead expenses ($54 million), incentive compensation ($26 million), customer services expense ($10 million), salaries expense ($9 million), the provision for credit losses on lending-related commitments ($6 million), travel and entertainment expense ($5 million) and smaller decreases in several other expense categories, partially offset by increases in other real estate expenses ($33 million) and FDIC insurance expense ($27 million). The corporate overhead allocation rates used were approximately 3.3 percent and 6.1 percent in 2009 and 2008, respectively.

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The decrease in rate in 2009, when compared to 2008, resulted primarily from an increase in funding credits due to the preferred stock issued to the U.S. Treasury.

The Retail Bank's net income decreased $82 million to a net loss of $48 million in 2009, compared to a decrease of $94 million, to net income of $34 million in 2008. Net interest income (FTE) of $510 million decreased $56 million, or 10 percent, in 2009, primarily due to a decline in deposit spreads caused by a competitive pricing environment, a decline in loan spreads and a decrease in average loans ($335 million), partially offset by an increase in average deposit balances ($444 million). The provision for loan losses increased $20 million to $143 million in 2009, primarily due to increases in reserves for the Personal Banking loan portfolio (primarily the Midwest market). Noninterest income of $190 million decreased $68 million in 2009, from $258 million in 2008, primarily due to a $48 million gain on the sale of Visa shares in 2008, a decrease in service charges on deposit accounts ($6 million) and a decline in net gains from the sale of Small Business loans and the early 2008 discontinuation of student loan sales ($5 million). Noninterest expenses of $642 million in 2009 decreased $3 million from 2008, primarily due to decreases in allocated net corporate overhead expenses ($25 million), salaries expense ($17 million) and smaller decreases in several other expense categories, partially offset by increases in FDIC insurance expense ($31 million) and net occupancy expense ($7 million), and the first quarter 2008 reversal of a $13 million Visa loss sharing expense recognized in 2007. Refer to the Business Bank discussion above for an explanation of the decrease in allocated net corporate overhead expenses.

Wealth & Institutional Management's net income increased $47 million to $43 million in 2009, compared to a decrease of $74 million to a net loss of $4 million in 2008. Net interest income (FTE) of $161 million increased $13 million, or eight percent, in 2009, compared to 2008, primarily due to increases in average deposits ($221 million) and average loans ($216 million), and an improvement in loan spreads from 2008. The provision for loan losses increased $37 million to $62 million, primarily due to an increase in reserves for the Private Banking loan portfolio. Noninterest income of $269 million decreased $23 million, or eight percent, in 2009, primarily due to decreases in fiduciary income ($37 million) and brokerage fees ($11 million), partially offset by an increase in gains on the redemption of auction-rate-securities ($10 million), an increase in investment banking fees ($9 million) and a $5 million gain on the second quarter 2009 sale of the Corporation's proprietary defined contribution plan recordkeeping business. The decrease in fiduciary income was primarily due to lower personal trust fees related to market value decline in late 2008 and a decline in institutional trust fees related to the second quarter 2009 sale of the Corporation's proprietary defined contribution plan recordkeeping business. Noninterest expenses of $302 million in 2009 decreased $120 million from 2008, primarily due to the $88 million net charge related to the repurchase of auction-rate securities in 2008, decreases in allocated net corporate overhead expenses ($13 million) and incentive compensation ($8 million), and smaller decreases in several other expense categories, partially offset by an increase in FDIC insurance expense ($5 million). Refer to the Business Bank discussion above for an explanation of the decrease in allocated net corporate overhead expenses.

The net loss in the Finance Division was $110 million in 2009, compared to a net loss of $48 million in 2008. Contributing to the $62 million increase in net loss was a $314 million decline in net interest income (FTE), primarily due to the Corporation's internal funds transfer policy. In the current low rate environment, the Finance Division provided a greater benefit for deposits, particularly noninterest-bearing deposits, to the three major business segments in 2009 than was actually realized at the corporate level. Noninterest expenses increased $6 million primarily due to an increase in FDIC insurance expense ($6 million). Partially offsetting these items was an increase of $224 million in noninterest income, resulting primarily from $225 million of gains on the sale of mortgage-backed government agency securities in 2009.

The net loss in the Other category was $15 million in 2009, compared to a net loss of $6 million in 2008. The increase in net loss of $9 million was primarily due to timing differences between when corporate overhead expenses are reflected as a consolidated expense and when the expenses are allocated to the business segments.

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GEOGRAPHIC MARKET SEGMENTS

The Corporation's management accounting system also produces market segment results for the Corporation's four primary geographic markets: Midwest, Western, Texas and Florida. In addition to the four primary geographic markets, Other Markets and International are also reported as market segments. The Finance & Other Businesses category includes discontinued operations and items not directly associated with the market segments. Note 24 to the consolidated financial statements presents a description of each of these market segments as well as the financial results for the years ended December 31, 2009, 2008 and 2007.

The following table presents net income (loss) by market segment.

		Years Ended December 31

		2009					2008					2007
		(dollar amounts in millions)
Midwest		$	37		26	%	$	205		77	%	$	294		40	%
Western			(14	)	(10	)		(19	)	(7	)		190		27
Texas			40		28			53		20			84		12
Florida			(23	)	(16	)		(13	)	(5	)		7		1
Other Markets (a)			78		55			12		4			89		13
International			24		17			29		11			50		7

			142		100	%		267		100	%		714		100	%
Finance & Other Businesses (b)			(125	)				(54	)				(28	)

	Total	$	17				$	213				$	686

(a): 2008 included an $88 million net charge ($56 million, after-tax) related to the repurchase of auction-rate securities from customers.
(b): Includes discontinued operations and items not directly associated with the market segments.

The Midwest market's net income decreased $168 million, or 82 percent, to $37 million in 2009, compared to a decrease of $89 million, or 30 percent, to $205 million in 2008. Net interest income (FTE) of $807 million increased $31 million from 2008, primarily due to $38 million of tax-related non-cash charges to income related to certain structured leasing transactions in 2008, an increase in loan spreads and the benefit provided by an increase in average deposit balances ($1.1 billion), partially offset by a decrease in average loan balances ($2.1 billion) and a decline in deposit spreads resulting from a significantly lower rate environment. The provision for loan losses increased $293 million, to $448 million in 2009, compared to 2008, primarily due to increases in reserves for the Middle Market, Commercial Real Estate (primarily residential real estate developments) and Leasing loan portfolios. Net credit-related charge-offs increased $199 million, largely due to increases in the Middle Market, Leasing, Commercial Real Estate and Small Business loan portfolios. Noninterest income of $435 million in 2009 decreased $89 million from 2008, primarily due to gains of $39 million on the sale of Visa shares and $14 million on the sale of MasterCard shares in 2008, and decreases in fiduciary income ($28 million), service charges on deposit accounts ($9 million) and card fees ($8 million). Partially offsetting these decreases was an increase in investment banking fees ($9 million) and an $8 million 2009 net gain on the termination of leveraged leases. Noninterest expenses of $761 million in 2009 decreased $52 million from 2008, primarily due to decreases in allocated net corporate overhead expenses ($41 million), incentive compensation ($13 million), the provision for credit losses on lending-related commitments ($7 million), service fees ($6 million) and smaller decreases in several other expense categories, partially offset by increases in FDIC insurance expense ($30 million) and other real estate expenses ($12 million), and the first quarter 2008 reversal of a $10 million Visa loss sharing arrangement expense recognized in 2007. Refer to the Business Bank discussion above for an explanation of the decrease in allocated net corporate overhead expenses.

The net loss in the Western market decreased $5 million to $14 million in 2009, compared to a $209 million decrease in net income to a net loss of $19 million in 2008. Net interest income (FTE) of $623 million decreased

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$45 million, or seven percent, in 2009, primarily due to declines in average loan balances ($2.3 billion) and average Financial Services Division deposits ($829 million), and the reduced value of these deposits due to the low interest rate environment, partially offset by an increase in loan spreads. The provision for loan losses decreased $21 million, to $358 million in 2009, from $379 million in 2008, primarily due to a reduction in reserves for the Commercial Real Estate loan portfolio (primarily residential real estate developers in California), partially offset by increases in reserves for the Global Corporate Banking and Middle Market loan portfolios. Net credit-related charge-offs increased $86 million, largely due to increases in charge-offs in the Global Corporate Banking and Middle Market loan portfolios. Noninterest income was $133 million in 2009, a decrease of $6 million from 2008, primarily due to a $5 million decrease in customer derivative income and smaller decreases in several other income categories, partially offset by increases in warrant income ($8 million) and service charges on deposits ($6 million). Noninterest expenses of $432 million in 2009 decreased $16 million from 2008, primarily due to decreases in allocated net corporate overhead expenses ($26 million), incentive compensation ($11 million) and customer services expense ($9 million), and smaller decreases in several other expense categories, partially offset by increases in other real estate expenses ($20 million), FDIC insurance expense ($19 million) and net occupancy expense ($6 million). Refer to the Business Bank discussion above for an explanation of the decrease in allocated net corporate overhead expenses.

The Texas market's net income decreased $13 million, or 25 percent, to $40 million in 2009, compared to a decrease of $31 million, or 37 percent, to $53 million in 2008. Net interest income (FTE) of $298 million increased $6 million, or two percent, in 2009, compared to 2008. The increase in net interest income (FTE) was primarily due to an increase in loan spreads and the benefit provided by an increase of $489 million in average deposit balances, partially offset by declines in deposit spreads. The provision for loan losses increased $34 million, primarily due to increases in reserves for the Commercial Real Estate and Middle Market loan portfolios in 2009, compared to 2008. Noninterest income of $86 million in 2009 decreased $8 million from 2008, primarily due to a $7 million gain on the sale of Visa shares in 2008. Noninterest expenses of $238 million in 2009 decreased $8 million from 2008, primarily due to a decrease in allocated net corporate overhead expenses ($13 million), partially offset by smaller increases in several other expense categories. Refer to the Business Bank discussion above for an explanation of the decrease in allocated net corporate overhead expenses.

The Florida market's net loss increased $10 million to $23 million in 2009, compared to a decrease in net income of $20 million to a net loss of $13 million in 2008. Net interest income (FTE) of $44 million in 2009 decreased $3 million, or seven percent, from 2008, primarily due to a $147 million decrease in average loan balances. The provision for loan losses increased $19 million and net credit-related charge-offs increased $21 million, primarily due to the Commercial Real Estate loan portfolio. Noninterest income of $12 million in 2009 decreased $4 million from 2008, primarily due to a decrease in customer derivative income. Noninterest expenses of $37 million in 2009 decreased $5 million from 2008 due to small decreases in several expense categories.

The Other Markets' net income increased $66 million to $78 million in 2009, compared to a decrease of $77 million to $12 million in 2008. Net interest income (FTE) of $158 million in 2009 increased $11 million from 2008, primarily due to an increase in loan spreads and a $212 million increase in average deposit balances, partially offset by a $334 million decrease in average loans. The provision for loan losses increased $20 million, primarily due to an increase in reserves for the Middle Market and Commercial Real Estate loan portfolios, partially offset by a decrease in reserves in the Global Corporate Banking loan portfolio. Net credit-related charge-offs increased $46 million, primarily due to an increase in charge-offs in the Commercial Real Estate loan portfolio. Noninterest income of $51 million increased $3 million in 2009, compared to 2008, primarily due to a $10 million increase in gains on the redemption of auction-rate securities and a gain of $5 million on the second quarter 2009 sale of the Corporation's proprietary defined contribution plan recordkeeping business, partially offset by a $5 million decrease in investment banking fees and smaller decreases in several other income categories. Noninterest expenses of $83 million in 2009 decreased $103 million from 2008, primarily due to the $88 million net charge related to the repurchase of auction-rate securities in 2008 and decreases in incentive

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compensation ($16 million) and allocated net corporate overhead expenses ($7 million). Refer to the Business Bank discussion above for an explanation of the decrease in allocated net corporate overhead expenses.

The International market's net income decreased $5 million, to $24 million in 2009, compared to a decrease of $21 million to $29 million in 2008. Net interest income (FTE) of $69 million in 2009 increased $8 million from 2008, primarily due to an increase in loan spreads, partially offset by a $330 million decrease in average loan balances. The provision for loan losses of $33 million in 2009 increased $29 million from $4 million in 2008. Noninterest income of $33 million in 2009 increased $2 million from 2008. Noninterest expenses of $31 million decreased $10 million in 2009 compared to 2008, primarily due to small decreases in several expense categories.

The net loss for the Finance & Other Business segment was $125 million in 2009, compared to a net loss of $54 million in 2008. The $71 million increase in net loss resulted from the same reasons noted in the Finance Division and Other category discussions under the "Business Segments" heading above.

The following table lists the Corporation's banking centers by geographic market segment.

		December 31

		2009		2008		2007
Midwest (Michigan)			232		233		237
Western:
	California		98		96		83
	Arizona		16		12		8

			114		108		91
Texas			90		87		79
Florida			10		10		9
International			1		1		1

	Total		447		439		417

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BALANCE SHEET AND CAPITAL FUNDS ANALYSIS

Total assets were $59.2 billion at December 31, 2009, a decrease of $8.3 billion from $67.5 billion at December 31, 2008. On an average basis, total assets decreased $2.4 billion to $62.8 billion in 2009, from $65.2 billion in 2008, resulting primarily from a decrease in loans ($5.6 billion), partially offset by increases in interest-bearing deposits with the FRB ($2.2 billion) and investment securities available-for-sale ($1.3 billion). Also, on an average basis, total liabilities decreased $4.0 billion to $55.7 billion in 2009, from $59.7 billion in 2008, resulting primarily from decreases of $4.2 billion in interest-bearing deposits and $2.8 billion in short-term borrowings, partially offset by increases of $2.3 billion in noninterest-bearing deposits and $877 million in medium- and long-term debt.

ANALYSIS OF INVESTMENT SECURITIES AND LOANS

			December 31

			2009		2008		2007		2006		2005
			(in millions)
U.S. Treasury and other U.S. government agency securities			$	103	$	79	$	36	$	46	$	124
Government-sponsored enterprise residential mortgage-backed securities				6,261		7,861		6,165		3,497		3,954
State and municipal securities				47		66		3		4		4
Corporate debt securities:
	Auction-rate debt securities			150		147		—		—		—
	Other corporate debt securities			50		42		46		46		58
Equity and other non-debt securities:
	Auction-rate preferred securities			706		936		—		—		—
	Money market and other mutual funds			99		70		46		69		100

		Total investment securities available-for-sale	$	7,416	$	9,201	$	6,296	$	3,662	$	4,240

Commercial loans			$	21,690	$	27,999	$	28,223	$	26,265	$	23,545
Real estate construction loans:
	Commercial Real Estate business line (a)			2,988		3,831		4,089		3,449		2,831
	Other business lines (b)			473		646		727		754		651

		Total real estate construction loans		3,461		4,477		4,816		4,203		3,482
Commercial mortgage loans:
	Commercial Real Estate business line (a)			1,824		1,619		1,377		1,534		1,450
	Other business lines (b)			8,633		8,870		8,671		8,125		7,417

		Total commercial mortgage loans		10,457		10,489		10,048		9,659		8,867
Residential mortgage loans				1,651		1,852		1,915		1,677		1,485
Consumer loans:
	Home equity			1,803		1,781		1,616		1,591		1,775
	Other consumer			708		811		848		832		922

		Total consumer loans		2,511		2,592		2,464		2,423		2,697
Lease financing				1,139		1,343		1,351		1,353		1,295
International loans:
	Government and official institutions			—		—		—		—		3
	Banks and other financial institutions			1		7		27		47		46
	Commercial and industrial			1,251		1,746		1,899		1,804		1,827

		Total international loans		1,252		1,753		1,926		1,851		1,876

		Total loans	$	42,161	$	50,505	$	50,743	$	47,431	$	43,247

(a): Primarily loans to real estate investors and developers.
(b): Primarily loans secured by owner-occupied real estate.

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EARNING ASSETS

Total earning assets decreased $7.8 billion, or 13 percent, to $54.6 billion at December 31, 2009, from $62.4 billion at December 31, 2008. The Corporation's average earning assets balances are reflected in the "Analysis of Net Interest Income-Fully Taxable Equivalent" table of this financial review.

Loans

The following tables detail the Corporation's average loan portfolio by loan type, business line and geographic market.



			Years Ended December 31
Average Loans By Loan Type:			2009		2008		Change			Percent Change
			(dollar amounts in millions)
Commercial loans			$	24,534	$	28,870	$	(4,336	)		(15	)%
Real estate construction loans:
	Commercial Real Estate business line (a)			3,538		4,052		(514	)		(13	)
	Other business lines (b)			602		663		(61	)		(9	)

		Total real estate construction loans		4,140		4,715		(575	)		(12	)
Commercial mortgage loans:
	Commercial Real Estate business line (a)			1,694		1,536		158			10
	Other business lines (b)			8,721		8,875		(154	)		(2	)

		Total commercial mortgage loans		10,415		10,411		4			—
Residential mortgage loans				1,756		1,886		(130	)		(7	)
Consumer loans:
	Home equity			1,796		1,669		127			8
	Other consumer			757		890		(133	)		(15	)

		Total consumer loans		2,553		2,559		(6	)		—
Lease financing				1,231		1,356		(125	)		(9	)
International loans				1,533		1,968		(435	)		(22	)

Total loans			$	46,162	$	51,765	$	(5,603	)		(11	)%

(a): Primarily loans to real estate investors and developers.
(b): Primarily loans secured by owner-occupied real estate.

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		Years Ended December 31
Average Loans By Business Line:		2009			2008		Change			Percent Change
		(dollar amounts in millions)
Middle Market		$	14,286		$	16,528	$	(2,242	)		(14	)%
Commercial Real Estate			6,083			6,610		(527	)		(8	)
Global Corporate Banking			6,006			6,444		(438	)		(7	)
National Dealer Services			3,466			4,872		(1,406	)		(29	)
Specialty Businesses (a)			5,561			6,413		(852	)		(13	)

	Total Business Bank		35,402			40,867		(5,465	)		(13	)
Small Business			3,948			4,244		(296	)		(7	)
Personal Financial Services			2,059			2,098		(39	)		(2	)

	Total Retail Bank		6,007			6,342		(335	)		(5	)
Private Banking			4,758			4,542		216			5

	Total Wealth & Institutional Management		4,758			4,542		216			5
Finance/Other			(5	)		14		(19	)		N/M

Total loans		$	46,162		$	51,765	$	(5,603	)		(11	)%

(a): Includes Entertainment, Energy, Leasing, Financial Services Division and Technology and Life Sciences.

N/M — not meaningful.



	Years Ended December 31
Average Loans By Geographic Market:	2009			2008		Change			Percent Change
	(dollar amounts in millions)
Midwest	$	16,965		$	19,062	$	(2,097	)		(11	)%
Western		14,281			16,565		(2,284	)		(14	)
Texas		7,384			7,776		(392	)		(5	)
Florida		1,745			1,892		(147	)		(8	)
Other Markets		3,883			4,217		(334	)		(8	)
International		1,909			2,239		(330	)		(15	)
Finance/Other		(5	)		14		(19	)		N/M

Total loans	$	46,162		$	51,765	$	(5,603	)		(11	)%

N/M — not meaningful.

Total loans were $42.2 billion at December 31, 2009, a decrease of $8.3 billion from $50.5 billion at December 31, 2008. As shown in the tables above, total average loans decreased $5.6 billion, or 11 percent, to $46.2 billion in 2009, compared to $51.8 billion 2008, with declines in nearly all business lines and in all geographic markets from 2008 to 2009.

Average commercial real estate loans, consisting of real estate construction and commercial mortgage loans, decreased $571 million, or four percent, to $14.6 billion in 2009, from $15.1 billion in 2008. Commercial mortgage loans are loans where the primary collateral is a lien on any real property. Real property is generally considered primary collateral if the value of that collateral represents more than 50 percent of the commitment at loan approval. Average loans to borrowers in the Commercial Real Estate business line, which primarily includes loans to real estate investors and developers, represented $5.2 billion, or 36 percent of average total commercial real estate loans, in 2009, compared to $5.6 billion, or 37 percent of average total commercial real estate loans, in

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2008. The decrease in average commercial real estate loans to borrowers in the Commercial Real Estate business line in 2009 largely resulted from the Corporation's efforts to reduce exposure to the residential real estate developer business. The remaining $9.4 billion and $9.5 billion of average commercial real estate loans in other business lines in 2009 and 2008, respectively, were primarily loans secured by owner-occupied real estate. In addition to the $14.6 billion of average 2009 commercial real estate loans discussed above, the Commercial Real Estate business line also had $851 million of average 2009 loans not classified as commercial real estate on the consolidated balance sheet.

Average residential mortgage loans, which primarily include mortgages originated and retained for certain relationship customers, decreased $130 million, or seven percent, to $1.8 billion in 2009, from 2008.

Average home equity loans increased $127 million, or eight percent, in 2009, from 2008, as a result of an increase in draws on new and existing commitments extended.

For more information on real estate loans, refer to the "Commercial and Residential Real Estate Lending" portion of the "Risk Management" section of this financial review.

Management expects low single-digit period-end loan growth for 2010, compared to period-end 2009.

ANALYSIS OF INVESTMENT SECURITIES PORTFOLIO
(Fully Taxable Equivalent)

			Maturity (a)

			Maturity (a)																									Weighted Average Maturity
			Within 1 Year					1 - 5 Years					5 - 10 Years					After 10 Years					Total					Weighted Average Maturity
December 31, 2009			Amount		Yield			Amount		Yield			Amount		Yield			Amount		Yield			Amount		Yield			Yrs./Mos.
			(dollar amounts in millions)
Available-for-sale
	U.S. Treasury and other
		U.S. government agency securities	$	103		0.43	%	$	—		—	%	$	—		—	%	$	—		—	%	$	103		0.45	%		0/6
	Government-sponsored enterprise residential mortgage-backed securities			119		3.78			146		3.61			542		4.15			5,454		3.77			6,261		3.80			13/4
	State and municipal securities (b)			1		9.55			—		—			—		—			46		1.91			47		2.15			18/0
	Corporate debt securities:
		Auction-rate debt securities		—		—			—		—			—		—			150		2.96			150		2.96			31/7
		Other corporate debt securities		43		0.25			7		7.55			—		—			—		—			50		1.22			0/7
	Equity and other non-debt securities:
		Auction-rate preferred securities (c)		—		—			—		—			—		—			706		1.08			706		1.08			—
		Money market and other mutual funds (d)		—		—			—		—			—		—			99		—			99		—			—

Total investment securities available-for-sale			$	266		1.92	%	$	153		3.80	%	$	542		4.15	%	$	6,455		3.44	%	$	7,416		3.45	%		13/5

(a): Based on final contractual maturity.
(b): Primarily auction-rate securities.
(c): Auction-rate preferred securities have no contractual maturity and are excluded from weighted average maturity.
(d): Balances are excluded from the calculation of total yield and weighted average maturity.

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Investment Securities Available-for-Sale

Investment securities available-for-sale decreased $1.8 billion to $7.4 billion at December 31, 2009, from $9.2 billion at December 31, 2008, reflecting sales of $5.3 billion of mortgage-backed government agency securities and redemptions of $262 million of auction-rate securities. Mortgage-backed government agency securities were sold in 2009 as market conditions were favorable and there was no longer a need to hold a large portfolio of fixed-rate securities to mitigate the impact of potential future rate declines on net interest income. On an average basis, investment securities available-for-sale increased $1.3 billion to $9.4 billion in 2009, compared to $8.1 billion in 2008, primarily due to the 2008 purchase of auction-rate securities from certain customers, all in the fourth quarter 2008.

The purchase of auction-rate securities in 2008 resulted from the Corporation's September 2008 offer to repurchase, at par, auction-rate securities held by certain retail and institutional clients that were sold through Comerica Securities, a broker/dealer subsidiary of Comerica Bank (the Bank). As of December 31, 2009, the Corporation's auction-rate securities portfolio was carried at an estimated fair value of $901 million, a decrease of $246 million compared to $1.1 billion at December 31, 2008. Subsequent to repurchase, auction-rate securities, primarily taxable and non-taxable auction-rate preferred securities, of $276 million were called or redeemed at par, resulting in net securities gains of $14 million in 2009, compared to $84 million called or redeemed at par in the fourth quarter 2008, resulting in net securities gains of $4 million in 2008. The Corporation experienced minimal credit-related losses or defaults on contractual interest payments related to the portfolio; however, the market for these securities was not active. For additional information on the repurchase of auction-rate securities, refer to the "Critical Accounting Policies" section of this financial review and Note 4 to the consolidated financial statements.

Management expects investment securities available-for-sale for 2010 to remain at a level similar to year-end 2009.

Short-Term Investments

Short-term investments include federal funds sold and securities purchased under agreements to resell, interest-bearing deposits with banks and other short-term investments. Federal funds sold offer supplemental earnings opportunities and serve correspondent banks. Average federal funds sold and securities purchased under agreements to resell decreased $75 million to $18 million during 2009, compared to 2008. Interest-bearing deposits with banks are investments with banks in developed countries or international banking facilities of foreign banks located in the United States and include deposits with the FRB since October 1, 2008, the date at which the FRB began paying interest on such balances. Average interest-bearing deposits with banks increased $2.2 billion to $2.4 billion in 2009, compared to 2008, due to an increase in average deposits with the FRB. Average deposits with the FRB represent excess liquidity, which resulted from strong core deposit growth at a time when loan demand remained weak. At December 31, 2009, interest-bearing deposits with the FRB totaled $4.8 billion, compared to $2.3 billion at December 31, 2008. Other short-term investments include trading securities and loans held-for-sale. Loans held-for-sale typically represent residential mortgage loans and Small Business Administration loans that have been originated with management's intention to sell. Short-term investments, other than loans held-for-sale, provide a range of maturities less than one year and are mostly used to manage liquidity requirements of the Corporation. Average other short-term investments decreased $90 million to $154 million in 2009, compared to 2008.

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INTERNATIONAL CROSS-BORDER OUTSTANDINGS

(year-end outstandings exceeding 1% of total assets)

December 31		Government and Official Institutions		Banks and Other Financial Institutions		Commercial and Industrial		Total

		(in millions)
Mexico	2009	$	—	$	—	$	681	$	681
	2008		—		—		883		883
	2007		—		4		911		915

International assets are subject to general risks inherent in the conduct of business in foreign countries, including economic uncertainties and each foreign government's regulations. Risk management practices minimize the risk inherent in international lending arrangements. These practices include structuring bilateral agreements or participating in bank facilities, which secure repayment from sources external to the borrower's country. Accordingly, such international outstandings are excluded from the cross-border risk of that country. Mexico, with cross-border outstandings of $681 million, or 1.15 percent of total assets at December 31, 2009, was the only country with outstandings exceeding 1.00 percent of total assets at year-end 2009. There were no countries with cross-border outstandings between 0.75 and 1.00 percent of total assets at year-end 2009. Additional information on the Corporation's Mexican cross-border risk is provided in the table above.

DEPOSITS AND BORROWED FUNDS

The Corporation's average deposits and borrowed funds balances are detailed in the following table.

		Years Ended December 31

		Years Ended December 31							Percent Change
		2009		2008		Change			Percent Change
		(dollar amounts in millions)
Noninterest-bearing deposits		$	12,900	$	10,623	$	2,277			21	%
Money market and NOW deposits			12,965		14,245		(1,280	)		(9	)
Savings deposits			1,339		1,344		(5	)		—
Customer certificates of deposit			8,131		8,150		(19	)		—

	Total core deposits		35,335		34,362		973			3
Other time deposits			4,103		6,715		(2,612	)		(39	)
Foreign office time deposits			653		926		(273	)		(29	)

Total deposits		$	40,091	$	42,003	$	(1,912	)		(5	)%

Short-term borrowings		$	1,000	$	3,763	$	(2,763	)		(73	)%
Medium- and long-term debt			13,334		12,457		877			7

	Total borrowed funds	$	14,334	$	16,220	$	(1,886	)		(12	)%

Average deposits were $40.1 billion in 2009, a decrease of $1.9 billion, or five percent, from $42.0 billion in 2008. Average core deposits increased $973 million, or three percent, in 2009, compared to 2008. Excluding the Financial Services Division, average core deposits increased $1.8 billion, or three percent, in 2009, compared to 2008. Within average core deposits, the majority of business lines showed increases from 2008 to 2009, including Global Corporate Banking (47 percent), National Dealer Services (17 percent) and Private Banking (nine percent). Average core deposits increased in nearly all geographic markets from 2008 to 2009, including International (42 percent), Other Markets (17 percent), Texas (12 percent), Florida (eight percent) and Midwest (five percent). The increase in average core deposits was, in part, due to an increased level of savings by customers during the uncertain economic conditions throughout 2009. The increase in insurance coverage limits on all domestic deposits from $100,000 to $250,000 and the temporary unlimited insurance coverage on certain

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transaction accounts, discussed below, expanded options to deposit savings into FDIC insured deposits. Average other time deposits decreased $2.6 billion and average foreign office time deposits decreased $273 million in 2009, compared to 2008. Other time deposits represent certificates of deposit issued to institutional investors in denominations in excess of $100,000 and to retail customers in denominations of less than $100,000 through brokers, and are an alternative to other sources of purchased funds. In the Financial Services Division, customers deposit large balances (primarily non-interest bearing) and the Corporation pays certain expenses on behalf of such customers and/or makes low-rate loans to such customers. Average Financial Services Division deposits decreased $846 million, or 33 percent, in 2009, compared to 2008, due to declines of $509 million in average interest-bearing deposits and $337 million in average noninterest-bearing deposits. The decrease in average Financial Services Division deposits in 2009 reflected lower home sales prices, as well as reduced home mortgage financing and refinancing activity. Financial Services Division deposit levels may change with the direction of mortgage activity changes, and the desirability of and competition for such deposits.

Short-term borrowings include federal funds purchased, securities sold under agreements to repurchase, borrowings under the Federal Reserve Term Auction Facility (TAF) and treasury tax and loan notes. Average short-term borrowings decreased $2.8 billion, to $1.0 billion in 2009, compared to $3.8 billion in 2008, reflecting decreases in federal funds purchased and TAF borrowing, due to reduced funding requirements of the Corporation. At December 31, 2009, the Corporation had no TAF borrowings.

The Corporation uses medium-term debt (both domestic and European) and long-term debt to provide funding to support earning assets. Medium- and long-term debt decreased by $4.0 billion in 2009, to $11.1 billion at December 31, 2009, compared to $15.1 billion at December 31, 2008, primarily as the result of the maturity of Federal Home Loan Bank advances ($2.0 billion) and medium-term notes ($1.6 billion) in 2009. On an average basis, medium- and long-term debt increased $877 million, or seven percent, in 2009, compared to 2008. Further information on medium- and long-term debt is provided in Note 14 to the consolidated financial statements.

In the fourth quarter 2008, the Corporation elected to participate in the Temporary Liquidity Guarantee Program (the TLG Program) announced by the FDIC in October 2008. At December 31, 2009, there was approximately $7 million of senior unsecured debt outstanding in the form of bank-to-bank deposits issued under the TLG Program, compared to $3 million at December 31, 2008.

The Corporation elected in 2009 to continue to participate in the unlimited FDIC deposit insurance protection under the TLG program covering noninterest-bearing deposit transaction accounts, interest-bearing transaction accounts earning interest rates of 50 basis points or less, and Interest on Lawyers' Trust Accounts (IOLTA's) through June 30, 2010, regardless of the account balance. This unlimited coverage is in addition to the increased FDIC limits approved on October 3, 2008, which increased insurance coverage limits on all deposits from $100,000 to $250,000 per account and expires December 31, 2013. An annualized surcharge of 10 basis points in 2009 and 15 to 25 basis points in 2010 is applied to those insured accounts not otherwise covered under the increased deposit insurance limit of $250,000, in addition to the existing risk-based deposit insurance premium paid on those deposits.

For further information on the TLG Program, see Note 14 to the consolidated financial statements.

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CAPITAL

Total shareholders' equity was $7.0 billion at December 31, 2009, compared to $7.2 billion at December 31, 2008. The following table presents a summary of changes in total shareholders' equity in 2009:

		(in millions)

Balance at January 1, 2009					$	7,152
Retention of earnings (net income less cash dividends declared)						(126	)
Change in accumulated other comprehensive loss:
Investment securities available-for-sale		$	(120	)
Cash flow hedges			(12	)
Defined benefit and other postretirement plans			105

	Total change in accumulated other comprehensive loss					(27	)
Repurchase of common stock under employee stock plans						(1	)
Issuance of common stock under employee stock plans						(3	)
Share-based compensation						32
Other						2

Balance at December 31, 2009					$	7,029

Further information on the change in accumulated other comprehensive income (loss) is provided in Note 16 to the consolidated financial statements.

The Corporation assesses capital adequacy against the risk inherent in the balance sheet, recognizing that unexpected loss is the common denominator of risk and that common equity has the greatest capacity to absorb unexpected loss. At December 31, 2009, the Corporation and its U.S. banking subsidiaries exceeded the capital ratios required for an institution to be considered "well capitalized" by the standards developed under the Federal Deposit Insurance Corporation Improvement Act of 1991. Refer to Note 22 to the consolidated financial statements for further discussion of regulatory capital requirements and capital ratio calculations.

Under the Capital Purchase Program, the consent of the U.S. Treasury is required for any increase in common dividends declared from the dividend rate in effect at the time of investment (quarterly dividend rate of $0.33 per share for the Corporation) and for any common share repurchases, other than common share repurchases in connection with any benefit plan in the ordinary course of business, until November 2011, unless the preferred shares have been fully redeemed or the U.S. Treasury has transferred all the preferred shares to third parties prior to that date. In addition, all accrued and unpaid dividends on the preferred shares must be declared and the payment set aside for the benefit of the holders of preferred shares before any dividend may be declared on the Corporation's common stock and before any shares of the Corporation's common stock may be repurchased, other than share repurchases in connection with any benefit plan in the ordinary course of business.

The Corporation made no share repurchases in the open market in 2009 or 2008, compared to repurchases of 10.0 million shares in 2007 for $580 million. At December 31, 2009, 12.6 million shares of Comerica Incorporated common stock remained available for repurchase under the Corporation's publicly announced repurchase program authorized by the Board of Directors of the Corporation (the Board). As discussed above, common share repurchases through November 2011 require the consent of the U.S. Treasury under the terms of the Capital Purchase Program.

Refer to Note 15 to the consolidated financial statements for additional information on the Capital Purchase Program and the Corporation's share repurchase program.

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RISK MANAGEMENT

The Corporation assumes various types of risk in the normal course of business. Management classifies risk exposures into five areas: (1) credit, (2) market, (3) operational, (4) compliance and (5) business risks and considers credit risk as the most significant risk.

The Corporation continues to enhance its risk management capabilities with additional processes, tools and systems designed to provide management with deeper insight into the Corporation's various risks, enhance the Corporation's ability to control those risks and ensure that appropriate return is received for the risks taken.

Specialized risk managers, along with the risk management committees in credit, market and liquidity, operational and compliance are responsible for the day-to-day management of those respective risks. The Corporation's Enterprise-Wide Risk Management Committee is responsible for establishing the governance over the risk management process, as well as providing oversight in managing the Corporation's aggregate risk position. The Enterprise-Wide Risk Management Committee is principally made up of the various managers from the different risk areas and business units and has reporting responsibility to the Enterprise Risk Committee of the Board.

CREDIT RISK

Credit risk represents the risk of loss due to failure of a customer or counterparty to meet its financial obligations in accordance with contractual terms. The Corporation manages credit risk through underwriting, periodically reviewing and approving its credit exposures using Board committee approved credit policies and guidelines. Additionally, the Corporation manages credit risk through loan sales and loan portfolio diversification, limiting exposure to any single industry, customer or guarantor, and selling participations and/or syndicating to third parties credit exposures above those levels it deems prudent.

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ANALYSIS OF THE ALLOWANCE FOR LOAN LOSSES

					Years Ended December 31

					2009			2008			2007			2006			2005
					(dollar amounts in millions)
Balance at beginning of year					$	770		$	557		$	493		$	516		$	673
Loan charge-offs:
	Domestic
		Commercial				375			183			89			44			91
		Real estate construction:
			Commercial Real Estate business line (a)			234			184			37			—			2
			Other business lines (b)			1			1			5			—			—

				Total real estate construction		235			185			42			—			2
		Commercial mortgage:
			Commercial Real Estate business line (a)			90			72			15			4			4
			Other business lines (b)			81			28			37			13			13

				Total commercial mortgage		171			100			52			17			17
			Residential mortgage			21			7			—			—			1
			Consumer			34			22			13			23			15
			Lease financing			36			1			—			10			37
	International					23			2			—			4			11

			Total loan charge-offs			895			500			196			98			174
Recoveries:
	Domestic
		Commercial				18			17			27			27			55
		Real estate construction				1			3			—			—			—
		Commercial mortgage				3			4			4			4			3
		Residential mortgage				—			—			—			—			—
		Consumer				2			3			4			3			5
		Lease financing				1			1			4			—			—
	International					2			1			8			4			1

			Total recoveries			27			29			47			38			64

Net loan charge-offs						868			471			149			60			110
Provision for loan losses						1,082			686			212			37			(47	)
Foreign currency translation adjustment						1			(2	)		1			—			—

Balance at end of year					$	985		$	770		$	557		$	493		$	516

Allowance for loan losses as a percentage of total loans at end of year						2.34	%		1.52	%		1.10	%		1.04	%		1.19	%
Net loan charge-offs during the year as a percentage of average loans outstanding during the year						1.88			0.91			0.30			0.13			0.25

(a): Primarily charge-offs of loans to real estate investors and developers.
(b): Primarily charge-offs of loans secured by owner-occupied real estate.

Allowance for Credit Losses

The allowance for credit losses includes both the allowance for loan losses and the allowance for credit losses on lending-related commitments. The allowance for loan losses represents management's assessment of

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probable losses inherent in the Corporation's loan portfolio. The allowance for loan losses provides for probable losses that have been identified with specific customer relationships and for probable losses believed to be inherent in the loan portfolio that have not been specifically identified. Internal risk ratings are assigned to each business loan at the time of approval and are subject to subsequent periodic reviews by the Corporation's senior management. The Corporation defines business loans as those belonging to the commercial, real estate construction, commercial mortgage, lease financing and international loan portfolios. The Corporation performs a detailed credit quality review quarterly on both large business and certain large consumer and residential mortgage loans that have deteriorated below certain levels of credit risk. When these individual loans are impaired, the Corporation may allocate a specific portion of the allowance to such loans, estimated using one of several methods, including estimated collateral value, market value of similar debt or discounted expected cash flows. A portion of the allowance is allocated to the remaining business loans by applying estimated loss ratios to the loans within each risk rating based on numerous factors identified below. In addition, a portion of the allowance is allocated to these remaining loans based on industry-specific risks inherent in certain portfolios that have experienced above average losses, including portfolio exposures to Small Business loans, high technology companies, retail trade (gasoline delivery) companies and automotive parts and tooling supply companies. The portion of the allowance allocated to all other consumer and residential mortgage loans is determined by applying estimated loss ratios to various segments of the loan portfolio. Estimated loss ratios for all portfolios are updated quarterly, incorporating factors such as recent charge-off experience, current economic conditions and trends, changes in collateral values of properties securing loans (using index-based estimates), and trends with respect to past due and nonaccrual amounts, and are supported by underlying analysis, including information on migration and loss given default studies from each of the Corporation's three largest domestic geographic markets (Midwest, Western and Texas), as well as mapping to bond tables. For collateral-dependent loans, independent appraisals are obtained at loan inception and updated on an as-needed basis, generally at the time a loan is determined to be impaired and at least annually thereafter. The allowance for credit losses on lending-related commitments, included in "accrued expenses and other liabilities" on the consolidated balance sheets, provides for probable credit losses inherent in lending-related commitments, including unused commitments to extend credit, letters of credit and financial guarantees. Lending-related commitments for which it is probable that the commitment will be drawn (or sold) are reserved with the same estimated loss rates as loans, or with specific reserves. In general, the probability of draw for letters of credit is considered certain once the credit is assigned a risk rating that is generally consistent with regulatory defined substandard or doubtful. Other letters of credit and all unfunded commitments have a lower probability of draw, to which standard loan loss rates are applied.

Actual loss ratios experienced in the future may vary from those estimated. The uncertainty occurs because factors may exist which affect the determination of probable losses inherent in the loan portfolio and are not necessarily captured by the application of estimated loss ratios or identified industry-specific risks. A portion of the allowance is maintained to capture these probable losses and reflects management's view that the allowance should recognize the margin for error inherent in the process of estimating expected loan losses. Factors that were considered in the evaluation of the adequacy of the Corporation's allowance include the inherent imprecision in the risk rating system which covers probable loan losses as a result of inaccuracy in assigning risk ratings or stale ratings which may not have been updated for recent negative trends in particular credits. In the first quarter 2009, the Corporation refined the methodology used to estimate the imprecision in the risk rating system portion of the allowance by only applying the identified error rate in assigning risk ratings, based on semiannual reviews, solely to the loan population that was tested. Previously, the error rate was applied to a larger population of loans. This change in methodology reduced the allowance by approximately $16 million in the first quarter 2009.

The allowance for loan losses is available to absorb losses from any segment within the portfolio. Unanticipated economic events, including political, economic and regulatory instability in countries where the Corporation has loans, could cause changes in the credit characteristics of the portfolio and result in an unanticipated increase in the allowance. Inclusion of other industry-specific portfolio exposures in the allowance, as well as significant increases in the current portfolio exposures, could also increase the amount of

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the allowance. Any of these events, or some combination thereof, may result in the need for additional provision for loan losses in order to maintain an allowance that complies with credit risk and accounting policies. The allowance for loan losses was $985 million at December 31, 2009, compared to $770 million at December 31, 2008, an increase of $215 million. The increase resulted primarily from increases in individual and industry reserves for the Middle Market (primarily the Midwest and Western markets), Global Corporate Banking (primarily the International and Western markets), Private Banking (primarily the Western market) and Commercial Real Estate (primarily in the Texas and Florida markets, partially offset by a decline in the Western market) loan portfolios. Commercial Real Estate challenges in the Western market moderated in 2009, compared to 2008, but remained a significant portion of the Commercial Real Estate allowance for loan losses. The $215 million increase in the allowance for loan losses in 2009 was directionally consistent with the $264 million increase in nonperforming loans from December 31, 2008 to December 31, 2009. The allowance for loan losses as a percentage of total period-end loans increased to 2.34 percent at December 31, 2009, from 1.52 percent at December 31, 2008. As noted above, all large nonperforming loans are individually reviewed each quarter for potential charge-offs and reserves. Charge-offs are taken as amounts are determined to be uncollectible. A measure of the level of charge-offs already taken on nonperforming loans is the current book balance as a percentage of the contractual amount owed. At December 31, 2009, nonperforming loans were charged-off to 56 percent of the contractual amount, compared to 66 percent at December 31, 2008. This level of write-downs is consistent with loss percentages taken on defaulted loans in recent years. The allowance as a percentage of total nonperforming loans, a ratio which results from the actions noted above, was 83 percent at December 31, 2009, compared to 84 percent at December 31, 2008. The Corporation's loan portfolio is heavily composed of business loans, which in the event of default are typically carried on the books at fair value as nonperforming assets for a longer period of time than are consumer loans, which are generally fully charged off when they become nonperforming, resulting in lower nonperforming loan allowance coverage. The allowance for loan losses as a multiple of total annual net loan charge-offs decreased to 1.1 times for the year ended December 31, 2009, compared to 1.6 times for the year ended December 31, 2008, as a result of higher levels of net loan charge-offs in 2009.

The allowance as a percentage of total loans, as a percentage of total nonperforming loans and as a multiple of annual net loan charge-offs is provided in the following table.

	Years Ended December 31

	2009			2008			2007
Allowance for loan losses as a percentage of total loans at end of year		2.34	%		1.52	%		1.10	%
Allowance for loan losses as a percentage of total nonperforming loans at end of year		83			84			138
Allowance for loan losses as a multiple of total net loan charge-offs for the year		1.1	x		1.6	x		3.7	x

ALLOCATION OF THE ALLOWANCE FOR LOAN LOSSES

			2009								2008					2007					2006					2005

			December 31
			Allocated Allowance		Allowance Ratio(a)			%(b)			Allocated Allowance		%(b)			Allocated Allowance		%(b)			Allocated Allowance		%(b)			Allocated Allowance		%(b)
			(dollar amounts in millions)
Domestic
	Commercial		$	456		2.10	%		51	%	$	380		55	%	$	288		55	%	$	320		55	%	$	336		55	%
	Real estate construction			194		5.60			8			194		9			128		9			29		9			21		8
	Commercial mortgage			219		2.09			25			147		21			92		20			80		20			74		21
	Residential mortgage			32		1.95			4			4		4			2		4			2		4			1		3
	Consumer			38		1.51			6			27		5			21		5			22		5			25		6
	Lease financing			13		1.15			3			6		3			15		3			27		3			29		3
International				33		2.63			3			12		3			11		4			13		4			30		4

		Total	$	985		2.34	%		100	%	$	770		100	%	$	557		100	%	$	493		100	%	$	516		100	%

(a): Allocated Allowance as a percentage of related loans outstanding.
(b): Loans outstanding as a percentage of total loans.

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The allowance for credit losses on lending-related commitments was $37 million at December 31, 2009, compared to $38 million at December 31, 2008, a decrease of $1 million. An analysis of the changes in the allowance for credit losses on lending-related commitments is presented below.

	Years Ended December 31

	2009		2008		2007			2006		2005
	(dollar amounts in millions)
Balance at beginning of year	$	38	$	21	$	26		$	33	$	21
Less: Charge-offs on lending-related commitments (a)		1		1		4			12		6
Add: Provision for credit losses on lending-related commitments		—		18		(1	)		5		18

Balance at end of year	$	37	$	38	$	21		$	26	$	33

(a): Charge-offs result from the sale of unfunded lending-related commitments.

SUMMARY OF NONPERFORMING ASSETS AND PAST DUE LOANS

				December 31

				2009			2008			2007			2006			2005
				(dollar amounts in millions)
Nonaccrual loans:
	Commercial			$	238		$	205		$	75		$	97		$	65
	Real estate construction:
		Commerical Real Estate business line (a)			507			429			161			18			3
		Other business lines (b)			4			5			6			2			—

			Total real estate construction		511			434			167			20			3
	Commercial mortgage:
		Commerical Real Estate business line (a)			127			132			66			18			6
		Other business lines (b)			192			130			75			54			29

			Total commercial mortgage		319			262			141			72			35
	Residential mortgage				50			7			1			1			2
	Consumer				12			6			3			4			2
	Lease financing				13			1			—			8			13
	International				22			2			4			12			18

			Total nonaccrual loans		1,165			917			391			214			138
Reduced-rate loans					16			—			13			—			—

			Total nonperforming loans		1,181			917			404			214			138
Foreclosed property					111			66			19			18			24

			Total nonperforming assets	$	1,292		$	983		$	423		$	232		$	162

Nonperforming loans as a percentage of total loans					2.80	%		1.82	%		0.80	%		0.45	%		0.32	%
Nonperforming assets as a percentage of total loans and foreclosed property					3.06			1.94			0.83			0.49			0.37
Allowance for loan losses as a percentage of total nonperforming loans					83			84			138			231			373
Loans past due 90 days or more and still accruing				$	101		$	125		$	54		$	14		$	16
Loans past due 90 days or more and still accruing as a percentage of total loans					0.24	%		0.25	%		0.11	%		0.03	%		0.04	%

(a): Primarily loans to real estate investors and developers.
(b): Primarily loans secured by owner-occupied real estate.

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Nonperforming Assets

Nonperforming assets include loans on nonaccrual status, loans which have been renegotiated to less than market rates due to a serious weakening of the borrower's financial condition and real estate which has been acquired through foreclosure and is awaiting disposition. Nonperforming assets increased $309 million to $1.3 billion at December 31, 2009, from $983 million at December 31, 2008. The table above presents nonperforming balances by category.

Residential real estate loans, which consist of traditional residential mortgages and home equity loans and lines of credit, are generally placed on nonaccrual status and charged off to current appraised values, less costs to sell, during the foreclosure process, normally no later than 180 days past due. Other consumer loans are generally not placed on nonaccrual status and are charged off at no later than 120 days past due, earlier if deemed uncollectible. Business loans are generally placed on nonaccrual status when management determines that principal or interest may not be fully collectible or when principal or interest payments are 90 days or more past due, unless the loan is fully collateralized and in the process of collection. Loan amounts in excess of probable future cash collections are charged off to an amount that management ultimately expects to collect. Interest previously accrued but not collected on nonaccrual loans is charged against current income at the time the loan is placed on nonaccrual. Income on such loans is then recognized only to the extent that cash is received and the future collection of principal is probable. Loans restructured in troubled debt restructurings bearing market rates of interest at the time of restructuring and performing in compliance with their modified terms (performing restructured loans) are considered impaired in the calendar year of the restructuring. At December 31, 2009, troubled debt restructurings totaled $34 million, of which $11 million were included in performing assets and $23 million were included in nonperforming assets ($16 million reduced-rate loans and $7 million nonaccrual loans). Refer to Note 1 to the consolidated financial statements for a further discussion of impaired loans.

The $248 million increase in nonaccrual loans at December 31, 2009, compared to December 31, 2008, resulted primarily from increases in nonaccrual real estate construction (primarily residential real estate developments) ($77 million), commercial mortgage ($57 million), residential mortgage ($43 million) and commercial ($33 million) loans. Nonperforming assets as a percentage of total loans and foreclosed property was 3.06 percent and 1.94 percent at December 31, 2009 and 2008, respectively.

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The following table presents a summary of changes in nonaccrual loans.

	2009			2008

	(in millions)
Balance at January 1	$	917		$	391
Loans transferred to nonaccrual (a)		1,287			1,123
Nonaccrual business loan gross charge-offs (b)		(838	)		(469	)
Loans transferred to accrual status (a)		(8	)		(11	)
Nonaccrual business loans sold (c)		(64	)		(47	)
Payments/Other (d)		(129	)		(70	)

Balance at December 31	$	1,165		$	917

(a): Based on an analysis of nonaccrual loans with book balances greater than $2 million.
(b): Analysis of gross loan charge-offs:


Nonaccrual business loans		$	838	$	469
Performing watch list loans (as defined below)			2		2
Consumer and residential mortgage loans			55		29

	Total gross loan charge-offs	$	895	$	500

(c): Analysis of loans sold:


Nonaccrual business loans		$	64	$	47
Performing watch list loans (as defined below)			31		16

	Total loans sold	$	95	$	63

(d): Includes net changes related to nonaccrual loans with balances less than $2 million, payments on nonaccrual loans with book balances greater than $2 million, transfers of nonaccrual loans to foreclosed property and consumer and residential mortgage loan charge-offs. Excludes business loan gross charge-offs and nonaccrual business loans sold.

The following table presents the number of nonaccrual loan relationships greater than $2 million and balance by size of relationship at December 31, 2009.

Nonaccrual Relationship Size	Number of Relationships		Balance

	(dollar amounts in millions)
$2 million — $5 million		71	$	231
$5 million — $10 million		41		295
$10 million — $25 million		20		305
Greater than $25 million		3		98

Total loan relationships greater than $2 million at December 31, 2009		135	$	929

There were 148 loan relationships each with balances greater than $2 million, totaling $1.3 billion, transferred to nonaccrual status in 2009, an increase of $164 million when compared to $1.1 billion in 2008. Of the transfers to nonaccrual with balances greater than $2 million in 2009, $597 million were from the Commercial Real Estate business line (including $305 million and $100 million from the Western and Florida markets, respectively), $336 million were from the Middle Market business line (including $202 million from the Midwest market) and $155 million were from the Global Corporate Banking business line. There were 45 loan relationships greater than $10 million transferred to nonaccrual in 2009, totaling $840 million, including

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transfers from companies in the Commercial Real Estate ($472 million), Middle Market ($173 million) and Global Corporate Banking ($124 million) business lines. The $472 million of Commercial Real Estate loan relationships greater than $10 million transferred to nonaccrual included $243 million from the Western market, $96 million from the Florida market and $70 million from the Midwest market.

The Corporation sold $64 million of nonaccrual business loans in 2009, including $36 million and $19 million of loans from the Global Corporate Banking and Commercial Real Estate loan portfolios, respectively.

Loans past due 90 days or more and still accruing interest generally represent loans that are well collateralized and managed in a continuing process that is expected to result in repayment or restoration to current status. Loans past due 90 days or more and still accruing decreased $24 million, to $101 million at December 31, 2009, from $125 million at December 31, 2008. Loans past due 30-89 days increased $110 million to $522 million at December 31, 2009, compared to $412 million at December 31, 2008.

Loans past due 90 days or more and still accruing are summarized in the following table.

	December 31

	2009		2008
	(in millions)
Commercial	$	10	$	34
Real estate construction		30		25
Commercial mortgage		31		36
Residential mortgage		15		23
Consumer		13		7
Lease financing		—		—
International		2		—

Total loans past due 90 days or more and still accruing	$	101	$	125

The following table presents a summary of total internally classified watch list loans (generally consistent with regulatory defined special mention, substandard and doubtful loans) at December 31, 2009 and 2008. Watch list loans that meet certain criteria are individually subjected to quarterly credit quality reviews, and the Corporation may allocate a specific portion of the allowance for loan losses to such loans. Consistent with the increase in nonaccrual loans from December 31, 2008 to December 31, 2009, total watch list loans increased both in dollars and as a percentage of the total loan portfolio. The increase in watch list loans primarily reflected negative migration in the Commercial Real Estate and Middle Market business lines.

	December 31

	2009			2008
	(dollar amounts in millions)
Total watch list loans	$	7,730		$	5,732
As a percentage of total loans		18.3	%		11.3	%

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The following table presents a summary of nonaccrual loans at December 31, 2009 and loan relationships transferred to nonaccrual and net loan charge-offs during the year ended December 31, 2009, based primarily on Standard Industrial Classification (SIC) industry categories.

					Year Ended December 31, 2009

	December 31, 2009				Year Ended December 31, 2009
	December 31, 2009				Loans Transferred to Nonaccrual (a)
Industry Category	Nonaccrual Loans				Loans Transferred to Nonaccrual (a)				Net Loan Charge-Offs
	(dollar amounts in millions)
Real estate	$	677	58	%	$	613	47	%	$	337	39	%
Services		95	8			118	9			105	12
Manufacturing		62	5			99	8			96	11
Holding & other investment		48	4			50	4			20	2
Retail trade		45	4			24	2			49	6
Wholesale trade		37	3			68	5			38	4
Automotive		31	3			102	8			54	6
Information		29	2			36	3			18	2
Hotels		22	2			39	3			19	2
Natural resources		13	1			24	2			9	1
Finance		13	1			22	2			16	2
Transportation		13	1			11	1			10	1
Contractors		10	1			7	1			19	2
Technology-related		7	1			47	3			24	3
Consumer non-durables		6	1			15	1			4	1
Utilities		3	—			3	—			7	1
Other (b)		54	5			9	1			43	5

Total	$	1,165	100	%	$	1,287	100	%	$	868	100	%

(a): Based on an analysis of nonaccrual loan relationships with book balances greater than $2 million.
(b): Consumer, excluding certain personal purpose, nonaccrual loans and net charge-offs, is included in the "Other" category.

The following table presents a summary of foreclosed property by property type as of December 31, 2009 and 2008.

	December 31

	2009		2008
	(in millions)
Construction, land development and other land	$	62	$	26
Single family residential properties		16		16
Multi-family residential properties		3		2
Other non-land, nonresidential properties		30		22

Total foreclosed property	$	111	$	66

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At December 31, 2009, foreclosed property totaled $111 million and consisted of approximately 210 properties, compared to $66 million and approximately 160 properties at December 31, 2008, an increase of $45 million. The following table presents a summary of changes in foreclosed property.

	2009			2008

	(in millions)
Balance at January 1	$	66		$	19
Acquired in foreclosure		114			63
Write-downs		(34	)		(6	)
Foreclosed property sold		(37	)		(10	)
Capitalized expenditures		2			—

Balance at December 31	$	111		$	66

At December 31, 2009, there were 13 foreclosed properties each with a carrying value greater than $2 million, totaling $61 million, an increase of $25 million when compared to $36 million at December 31, 2008. Of the foreclosed properties with balances greater than $2 million at December 31, 2009, $58 million were in the Commercial Real Estate business line, including $33 million in the Western market. At December 31, 2009 and 2008, there were no foreclosed properties with a carrying value greater than $10 million.

Concentration of Credit

The Corporation has an industry concentration with the automotive industry. Loans to automotive dealers and to borrowers involved with automotive production are reported as automotive, as management believes these loans have similar economic characteristics that might cause them to react similarly to changes in economic conditions. This aggregation involves the exercise of judgment. Included in automotive production are: (a) original equipment manufacturers and Tier 1 and Tier 2 suppliers that produce components used in vehicles and whose primary revenue source is automotive-related ("primary" defined as greater than 50%) and (b) other manufacturers that produce components used in vehicles and whose primary revenue source is automotive-related. Loans less than $1 million and loans recorded in the Small Business loan portfolio are excluded from the definition. Foreign ownership consists of North American affiliates of foreign automakers and suppliers.

The following table presents a summary of loans outstanding to companies related to the automotive industry.

			December 31

			2009					2008
			Loans Outstanding		Percent of Total Loans			Loans Outstanding		Percent of Total Loans
			(in millions)
Production:
	Domestic		$	760				$	1,219
	Foreign			181					240

		Total production		941		2.2	%		1,459		2.9	%
Dealer:
	Floor plan			1,324					2,295
	Other			2,106					2,360

		Total dealer		3,430		8.2	%		4,655		9.2	%

		Total automotive	$	4,371		10.4	%	$	6,114		12.1	%

At December 31, 2009, dealer loans, as shown in the table above, totaled $3.4 billion, of which approximately $2.2 billion, or 64 percent, were to foreign franchises, $782 million, or 23 percent, were to domestic franchises and $463 million, or 13 percent, were to other. Other dealer loans include obligations where

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a primary franchise was indeterminable, such as loans to large public dealership consolidators and rental car, leasing, heavy truck and recreation vehicle companies.

Nonaccrual loans to automotive borrowers totaled $31 million, or three percent, of total nonaccrual loans at December 31, 2009. Total automotive net loan charge-offs were $54 million in 2009. The following table presents a summary of automotive net loan charge-offs for the years ended December 31, 2009 and 2008.

		Years Ended December 31

		2009		2008
		(in millions)
Production:
	Domestic	$	50	$	6
	Foreign		4		—

	Total production	$	54	$	6
Dealer			—		—

	Total automotive net loan charge-offs	$	54	$	6

All other industry concentrations, as defined by management, individually represented less than 10 percent of total loans at December 31, 2009.

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Commercial and Residential Real Estate Lending

The Corporation limits risk inherent in its commercial real estate lending activities by limiting exposure to those borrowers directly involved in the commercial real estate markets and adhering to conservative policies on loan-to-value ratios for such loans. Commercial real estate loans, consisting of real estate construction and commercial mortgage loans, totaled $13.9 billion at December 31, 2009, of which $4.8 billion, or 35 percent, were to borrowers in the Commercial Real Estate business line, which includes loans to residential real estate developers. The remaining $9.1 billion, or 65 percent, of commercial real estate loans in other business lines consisted primarily of owner-occupied commercial mortgages which bear credit characteristics similar to non-commercial real estate business loans.

The geographic distribution and project type of commercial real estate loans are important factors in diversifying credit risk within the portfolio. The following table reflects real estate construction and commercial mortgage loans to borrowers in the Commercial Real Estate business line by project type and location of property.

					December 31, 2009															December 31, 2008

					Location of Property
Project Type:					Western		Michigan		Texas		Florida		Other Markets		Total		% of Total			Total		% of Total
					(dollar amounts in millions)
Real estate construction loans:
	Commercial Real Estate business line:
		Residential:
			Single family		$	276	$	43	$	24	$	104	$	53	$	500		17	%	$	1,046		26	%
			Land development			132		31		102		14		26		305		10			465		12

				Total residential		408		74		126		118		79		805		27			1,511		38
		Other construction:
			Multi-family			215		6		258		143		152		774		27			596		16
			Retail			197		124		347		51		40		759		25			832		21
			Multi-use			136		34		36		24		12		242		8			402		11
			Office			110		5		89		15		33		252		8			297		8
			Commercial			1		23		46		—		—		70		2			105		3
			Land development			8		15		10		—		3		36		1			60		2
			Other			33		—		7		—		10		50		2			28		1

Total					$	1,108	$	281	$	919	$	351	$	329	$	2,988		100	%	$	3,831		100	%

Commercial mortgage loans:
	Commercial Real Estate business line:
		Residential:
			Single family		$	14	$	2	$	13	$	10	$	2	$	41		2	%	$	60		4	%
			Land carry			64		62		30		41		19		216		12			344		21

				Total residential		78		64		43		51		21		257		14			404		25
		Other commercial mortgage:
			Multi-family			68		62		126		103		52		411		22			303		19
			Retail			134		58		2		24		74		292		16			212		13
			Land carry			143		61		13		13		11		241		13			295		18
			Multi-use			149		—		12		—		75		236		13			46		3
			Office			97		57		24		11		5		194		11			219		14
			Commercial			49		28		6		—		43		126		7			121		7
			Other			16		9		1		—		41		67		4			19		1

Total					$	734	$	339	$	227	$	202	$	322	$	1,824		100	%	$	1,619		100	%

Residential real estate development outstandings of $1.1 billion at December 31, 2009 decreased $853 million, or 44 percent, from $1.9 billion at December 31, 2008. Net credit-related charge-offs in the Commercial Real Estate business line were $335 million in 2009, including $179 million in the Western market, with the majority from the residential real estate development business, and $80 million in the Midwest market.

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The following table summarizes the Corporation's commercial real estate loan portfolio by loan category as of December 31, 2009 and 2008.

		December 31

		2009		2008
		(in millions)
Real estate construction loans:
	Commercial Real Estate business line (a)	$	2,988	$	3,831
	Other business lines (b)		473		646

Total real estate construction loans		$	3,461		4,477

Commercial mortgage loans:
	Commercial Real Estate business line (a)	$	1,824		1,619
	Other business lines (b)		8,633		8,870

Total commercial mortgage loans		$	10,457		10,489

(a): Primarily loans to real estate investors and developers.
(b): Primarily loans secured by owner-occupied real estate.

The real estate construction loan portfolio totaled $3.5 billion at December 31, 2009 and included approximately 800 loans, of which approximately 40 percent had balances less than $1 million. The real estate construction loan portfolio primarily contains loans made to long-time customers with satisfactory completion experience. However, the significant and sudden decline in residential real estate activity in the Western, Florida and Midwest markets proved extremely difficult for many smaller residential real estate developers. Of the $3.0 billion of real estate construction loans in the Commercial Real Estate business line, $507 million were on nonaccrual status at December 31, 2009, of which $257 million were single family projects (largely in the Western and Florida markets) and $112 million were residential land development projects (largely in the Western and Texas markets). Real estate construction loan net charge-offs in the Commercial Real Estate business line totaled $233 million for 2009, including $135 million from single family projects, largely concentrated in the Western market, and $73 million from residential land development projects, primarily in the Western and Midwest markets.

When the Corporation enters into a loan agreement with a borrower for a real estate construction loan, an interest reserve is often included in the amount of the loan commitment. An interest reserve allows the borrower to add interest charges to the outstanding loan balance during the construction period. Interest reserves are established on substantially all real estate construction loans in the Corporation's Commercial Real Estate business line. Interest reserves provide an effective means to address the cash flow characteristics of a real estate construction loan. Loan agreements containing an interest reserve generally require more equity to be contributed by the borrower to the construction project at inception. Real estate construction loans with interest reserves are subject to substantially the same Board committee approved underwriting standards as loans without interest reserves. Interest that has been added to the balance of a real estate construction loan through the use of an interest reserve is recognized as income only if the Corporation expects full collection of the remaining contractual principal and interest payments. If a real estate construction loan with interest reserves is in default and deemed uncollectible, interest is no longer funded through the interest reserve. Interest previously recognized from interest reserves generally is not reversed against current income when a construction loan with interest reserves is placed on nonaccrual status. All real estate construction loans are closely monitored through physical inspections, reconciliation of draw requests, review of rent rolls and operating statements and quarterly portfolio reviews performed by the Corporation's senior management. When appropriate, extensions, renewals and restructurings of real estate construction loans are approved after giving consideration to the project's status, the borrower's financial condition, and the collateral protection based on current market conditions, and

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typically strengthen the Corporation's position by adding additional collateral and controls and/or requiring amortization on the existing debt.

The commercial mortgage loan portfolio totaled $10.5 billion at December 31, 2009 and included approximately 8,500 loans, of which approximately 75 percent had balances of less than $1 million. The commercial mortgage loan portfolio included $8.6 billion of primarily owner-occupied commercial mortgage loans. Commercial mortgage loans in the Commercial Real Estate business line totaled $1.8 billion and included $127 million of nonaccrual loans at December 31, 2009, which consisted primarily of residential land carry, commercial land carry and office projects ($50 million, $28 million and $28 million, respectively), located primarily in the Western and Midwest markets. Commercial mortgage loan net charge-offs in the Commercial Real Estate business line totaled $89 million for 2009, primarily from residential and commercial land carry projects ($48 million and $26 million, respectively).

Residential real estate loans, which consist of traditional residential mortgages and home equity loans and lines of credit, totaled $3.5 billion at December 31, 2009. Residential mortgages totaled $1.7 billion at December 31, 2009, and were primarily larger, variable-rate mortgages originated and retained for certain private banking relationship customers. By geographic market, 42 percent of residential mortgage loans outstanding were in the Midwest market, 30 percent in the Western market, 15 percent in the Texas market and 13 percent in the Florida market at December 31, 2009.

The home equity portfolio totaled $1.8 billion at December 31, 2009, of which $1.6 billion was outstanding under primarily variable-rate, interest-only home equity lines of credit and $246 million consisted of closed-end home equity loans. By geographic market, 62 percent of home equity loans outstanding were in the Midwest market, 26 percent in the Western market, nine percent in the Texas market and three percent in the Florida market at December 31, 2009. A substantial majority of the home equity portfolio was secured by junior liens.

The Corporation rarely originates residential real estate loans with a loan-to-value ratio at origination above 100 percent, has no sub-prime mortgage programs and does not originate payment-option adjustable-rate mortgages or other nontraditional mortgages that allow negative amortization. A significant majority of residential mortgage originations are sold in the secondary market. The residential real estate portfolio is principally located within the Corporation's primary geographic markets. The economic recession and significant declines in home values in the Western, Florida and Midwest markets following the financial market turmoil beginning in the fall of 2008 adversely impacted the residential real estate portfolio. At December 31, 2009, the Corporation estimated that, of the $15 million total residential mortgage loans past due 90 days or more and still accruing interest, less than $5 million exceeded 90 percent of the current value of the underlying collateral, based on S&P/Case-Shiller home price indices. To account for this exposure, the Corporation factors changes in home values into estimated loss ratios for residential real estate loans, using index-based estimates by major metropolitan area, resulting in an increased allowance allocated for residential real estate loans when home values decline. Additionally, to mitigate increasing credit exposure due to depreciating home values, the Corporation periodically reviews home equity lines of credit and makes line reductions or converts outstanding balances at line maturity to closed-end, amortizing loans when necessary.

Shared National Credits

Shared National Credit (SNC) loans are facilities greater than $20 million shared by three or more federally supervised financial institutions that are reviewed by regulatory authorities at the agent bank level. The Corporation generally seeks to obtain ancillary business at the origination of a SNC relationship. Loans classified as SNC loans (approximately 1,000 borrowers) totaled $9.1 billion at December 31, 2009, a decline of $2.8 billion from $11.9 billion at December 31, 2008. SNC loans, diversified by both business line and geographic market, comprised approximately 20 percent of total loans at both December 31, 2009 and December 31, 2008. SNC loans are held to the same credit underwriting standards as the remainder of the loan portfolio and face similar credit challenges, primarily driven by residential real estate developments.

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MARKET RISK

Market risk represents the risk of loss due to adverse movements in market rates or prices, including interest rates, foreign exchange rates and equity prices, the failure to meet financial obligations coming due resulting from an inability to liquidate assets or obtain adequate funding, and the inability to easily unwind or offset specific exposures without significantly lowering prices, due to inadequate market depth or market disruptions.

The Asset and Liability Policy Committee establishes and monitors compliance with the policies and risk limits pertaining to market risk management activities. The Asset and Liability Policy Committee meets regularly to discuss and review market risk management strategies and consists of executive and senior management from various areas of the Corporation, including finance, lending, deposit gathering and risk management.

Interest Rate Risk

Net interest income, which is derived principally from the difference between interest earned on loans and investment securities and interest paid on deposits and other funding sources, is the predominant source of revenue for the Corporation. Interest rate risk arises primarily through the Corporation's core business activities of extending loans and accepting deposits. The Corporation's balance sheet is predominantly characterized by floating-rate commercial loans funded by a combination of core deposits and wholesale borrowings. This creates a natural imbalance between the floating-rate loan portfolio and the more slowly repricing deposit products. The result is that growth and/or contraction in the Corporation's core businesses will lead to sensitivity to interest rate movements without mitigating actions. Examples of such actions are purchasing investment securities, primarily fixed-rate, which provide liquidity to the balance sheet and act to mitigate the inherent interest sensitivity, and hedging the sensitivity with interest rate swaps. The Corporation actively manages its exposure to interest rate risk, with the principal objective of optimizing net interest income and the economic value of equity while operating within acceptable limits established for interest rate risk and maintaining adequate levels of funding and liquidity.

Interest Rate Sensitivity

Interest rate risk arises in the normal course of business due to differences in the repricing and cash flow characteristics of assets and liabilities. Since no single measurement system satisfies all management objectives, a combination of techniques is used to manage interest rate risk. These techniques examine earnings at risk and the economic value of equity utilizing multiple simulation analyses.

The Corporation frequently evaluates net interest income under various balance sheet and interest rate scenarios, using simulation modeling analysis as its principal risk management evaluation technique. The results of these analyses provide the information needed to assess the balance sheet structure. Changes in economic activity, whether domestic or international, different from those management included in its simulation analyses could translate into a materially different interest rate environment than currently expected. Management evaluates a base case net interest income under an unchanged interest rate environment and what is believed to be the most likely balance sheet structure. This base case net interest income is then evaluated against non-parallel interest rate scenarios that gradually increase and decrease rates approximately 200 basis points in a linear fashion from the base case over twelve months (but decrease to no lower than zero percent). Due to the low level of interest rates, both the December 31, 2009 and 2008 analyses reflect a declining interest rate scenario of a 25 basis point drop, to zero percent, while the rising interest rate scenario reflects a gradual 200 basis point rise. In addition, consistent with each interest rate scenario, adjustments to asset prepayment levels, yield curves, and overall balance sheet mix and growth assumptions are made. These assumptions are inherently uncertain and, as a result, the model may not precisely predict the impact of higher or lower interest rates on net interest income. Actual results may differ from simulated results due to timing, magnitude and frequency of changes in interest rate, market conditions and management strategies, among other factors. However, the model can indicate the likely direction of change. Derivative instruments entered into for risk management purposes are included in these analyses.

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The table below, as of December 31, 2009 and 2008, displays the estimated impact on net interest income during the next 12 months by relating the base case scenario results to those from the rising and declining rate scenarios described above.

Sensitivity of Net Interest Income to Changes in Interest Rates

		December 31 2009						December 31 2008

		Amount			%			Amount			%
		(in millions)						(in millions)
Change in Interest Rates:
	+200 basis points	$	74			4		$	85			5
	-25 basis points (to zero percent)		(13	)		(1	)		(19	)		(1	)

Corporate policy limits adverse change to no more than four percent of management's most likely net interest income forecast, and the Corporation was within this policy guideline at December 31, 2009. The change in interest rate sensitivity from December 31, 2008 to December 31, 2009 was primarily driven by changes in the Corporation's deposit mix resulting from movement of fixed-rate certificates of deposit into other deposit products. Interest rate risk is actively managed principally through the use of either on-balance sheet financial instruments or interest rate swaps to achieve the desired risk profile.

In addition to the simulation analysis, an economic value of equity analysis is performed for a longer term view of the interest rate risk position. The economic value of equity analysis begins with an estimate of the mark-to-market valuation of the Corporation's balance sheet and then applies the estimated impact of rate movements to the market value of assets, liabilities and off-balance sheet instruments. The economic value of equity is then calculated as the difference between the estimated market value of assets and liabilities net of the impact of off-balance sheet instruments.

The table below, as of December 31, 2009 and 2008, displays the estimated impact on the economic value of equity from a 200 basis point immediate parallel increase or decrease in interest rates (but decrease to no lower than zero percent). Similar to the simulation analysis above, due to the low level of interest rates, both the December 31, 2009 and 2008 economic value of equity analyses below reflects an interest rate scenario of an immediate 25 basis point drop, to zero percent, while the rising interest rate scenario reflects an immediate 200 basis point rise.

Sensitivity of Economic Value of Equity to Changes in Interest Rates

		December 31 2009						December 31 2008

		Amount			%			Amount			%
		(in millions)						(in millions)
Change in Interest Rates:
	+200 basis points	$	329			3		$	585			5
	-25 basis points (to zero percent)		(91	)		(1	)		(134	)		(1	)

Corporate policy limits adverse change in the estimated market value change in the economic value of equity to 15 percent of the base economic value of equity. The Corporation was within this policy parameter at December 31, 2009. The change in the sensitivity of the economic value of equity to a 200 basis point parallel increase in rates between December 31, 2008 and December 31, 2009 was primarily driven by changes in the Corporation's deposit mix resulting from movement of fixed-rate certificates of deposit into other deposit products. As with net interest income shocks, a variety of alternative scenarios are performed to measure the impact on the economic value of equity, including changes in the level, slope and shape of the yield curve.

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LOAN MATURITIES AND INTEREST RATE SENSITIVITY

			Loans Maturing

December 31, 2009			Within One Year(a)		After One But Within Five Years		After Five Years		Total
			(in millions)
Commercial loans			$	17,139	$	4,112	$	439	$	21,690
Real estate construction loans				2,684		699		78		3,461
Commercial mortgage loans				4,887		4,475		1,095		10,457
International loans				1,176		72		4		1,252

		Total	$	25,886	$	9,358	$	1,616	$	36,860

Sensitivity of Loans to Changes in Interest Rates:
	Predetermined (fixed) interest rates				$	4,183	$	1,195
	Floating interest rates					5,175		421

		Total			$	9,358	$	1,616

(a): Includes demand loans, loans having no stated repayment schedule or maturity and overdrafts.

The Corporation uses investment securities and derivative instruments, predominantly interest rate swaps, as asset and liability management tools with the overall objective of managing the volatility of net interest income from changes in interest rates. Swaps modify the interest rate characteristics of certain assets and liabilities (e.g., from a floating rate to a fixed rate, from a fixed rate to a floating rate or from one floating-rate index to another). These tools assist management in achieving the desired interest rate risk management objectives.

Risk Management Derivative Instruments

Risk Management Notional Activity	Interest Rate Contracts			Foreign Exchange Contracts			Totals

	(in millions)
Balance at January 1, 2008	$	5,402		$	549		$	5,951
Additions		1,850			5,252			7,102
Maturities/amortizations		(3,702	)		(5,257	)		(8,959	)
Terminations		(150	)		—			(150	)

Balance at December 31, 2008	$	3,400		$	544		$	3,944
Additions		429			3,148			3,577
Maturities/amortizations		(529	)		(3,439	)		(3,968	)
Terminations		—			—			—

Balance at Decmber 31, 2009	$	3,300		$	253		$	3,553

The notional amount of risk management interest rate swaps totaled $3.3 billion at December 31, 2009 and $3.4 billion at December 31, 2008. The fair value of risk management interest rate swaps was a net unrealized gain of $224 million at December 31, 2009, compared to a net unrealized gain of $396 million at December 31, 2008.

For the year ended December 31, 2009, risk management interest rate swaps generated $95 million of net interest income, compared to $67 million of net interest income for the year ended December 31, 2008. The increase in swap income for 2009, compared to 2008, was primarily due to maturities in 2008 of interest rate swaps that carried negative spreads.

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In addition to interest rate swaps, the Corporation employs various other types of derivative instruments as offsetting positions to mitigate exposures to interest rate and foreign currency risks associated with specific assets and liabilities (e.g., customer loans or deposits denominated in foreign currencies). Such instruments may include interest rate caps and floors, total return swaps, foreign exchange forward contracts and foreign exchange swap agreements. The aggregate notional amounts of these risk management derivative instruments at December 31, 2009 and 2008 were $253 million and $544 million, respectively.

Further information regarding risk management derivative instruments is provided in Note 10 to the consolidated financial statements.

Customer-Initiated and Other Derivative Instruments

Customer-Initiated and Other Notional Activity	Interest Rate Contracts			Energy Derivative Contracts			Foreign Exchange Contracts			Totals

	(in millions)
Balance at January 1, 2008	$	8,508		$	1,481		$	2,715		$	12,704
Additions		5,454			1,670			108,886			116,010
Maturities/amortizations		(1,140	)		(918	)		(108,878	)		(110,936	)
Terminations		(480	)		(88	)		—			(568	)

Balance at December 31, 2008	$	12,342		$	2,145		$	2,723		$	17,210
Additions		2,527			1,734			97,715			101,976
Maturities/amortizations		(2,190	)		(1,519	)		(98,360	)		(102,069	)
Terminations		(583	)		(23	)		(55	)		(661	)

Balance at December 31, 2009	$	12,096		$	2,337		$	2,023		$	16,456

The Corporation writes and purchases interest rate caps and floors and enters into foreign exchange contracts, interest rate swaps and energy derivative contracts to accommodate the needs of customers requesting such services. Customer-initiated and other notional activity represented 82 percent of total interest rate, energy and foreign exchange contracts at December 31, 2009, compared to 81 percent at December 31, 2008.

Further information regarding customer-initiated and other derivative instruments in provided in Note 10 to the consolidated financial statements.

Liquidity Risk and Off-Balance Sheet Arrangements

Liquidity is the ability to meet financial obligations through the maturity or sale of existing assets or the acquisition of additional funds. Various financial obligations, including contractual obligations and commercial commitments, may require future cash payments by the Corporation. The following contractual obligations table summarizes the Corporation's noncancelable contractual obligations and future required minimum payments. Refer to Notes 8, 12, 13, 14, and 20 to the consolidated financial statements for further information regarding these contractual obligations.

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Contractual Obligations

		Minimum Payments Due by Period

December 31, 2009		Total		Less than 1 Year		1–3 Years		3–5 Years		More than 5 Years
		(in millions)
Deposits without a stated maturity (a)		$	31,662	$	31,662	$	—	$	—	$	—
Certificates of deposit and other deposits with a stated maturity (a)			8,002		7,146		722		93		41
Short-term borrowings (a)			462		462		—		—		—
Medium- and long-term debt (a)			10,851		2,750		2,533		3,250		2,318
Operating leases			643		68		125		107		343
Commitments to fund low income housing partnerships			63		44		18		1		—
Other long-term obligations (b)			270		45		67		22		136

	Total contractual obligations	$	51,953	$	42,177	$	3,465	$	3,473	$	2,838

Medium- and long-term debt (a) (parent company only)		$	965	$	150	$	—	$	—	$	815

(a): Deposits and borrowings exclude accrued interest.
(b): Includes unrecognized tax benefits.

In addition to contractual obligations, other commercial commitments of the Corporation impact liquidity. These include commitments to purchase and sell earning assets, commitments to fund indirect private equity and venture capital investments, unused commitments to extend credit, standby letters of credit and financial guarantees, and commercial letters of credit. The following commercial commitments table summarizes the Corporation's commercial commitments and expected expiration dates by period.

Commercial Commitments

		Expected Expiration Dates by Period

December 31, 2009		Total		Less than 1 Year		1–3 Years		3–5 Years		More than 5 Years
		(in millions)
Commitments to purchase investment securities		$	19	$	19	$	—	$	—	$	—
Commitments to sell investment securities			19		19		—		—		—
Commitments to fund indirect private equity and venture capital investments			27		4		5		2		16
Unused commitments to extend credit			24,368		10,092		11,506		1,093		1,677
Standby letters of credit and financial guarantees			5,670		3,812		1,398		416		44
Commercial letters of credit			104		92		11		1		—

	Total commercial commitments	$	30,207	$	14,038	$	12,920	$	1,512	$	1,737

Since many of these commitments expire without being drawn upon, the total amount of these commercial commitments does not necessarily represent the future cash requirements of the Corporation. Refer to the "Other Market Risks" section below and Note 10 to the consolidated financial statements for a further discussion of these commercial commitments.

Wholesale Funding

The Corporation satisfies liquidity requirements with either liquid assets or various funding sources. At December 31, 2009, the Corporation held excess liquidity, represented by $4.8 billion deposited with the FRB. The Corporation may access the purchased funds market when necessary, which includes certificates of deposit

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issued to institutional investors in denominations in excess of $100,000 and to retail customers in denominations of less than $100,000 through brokers ("other time deposits" on the consolidated balance sheets), foreign office time deposits and short-term borrowings. Purchased funds totaled $2.1 billion at December 31, 2009, compared to $9.5 billion and $10.2 billion at December 31, 2008 and 2007, respectively. Capacity for incremental purchased funds at December 31, 2009 consisted largely of federal funds purchased, brokered certificates of deposits and securities sold under agreements to repurchase. In addition, the Corporation is a member of the Federal Home Loan Bank of Dallas, Texas (FHLB), which provides short- and long-term funding to its members through advances collateralized by real estate-related assets. The actual borrowing capacity is contingent on the amount of collateral available to be pledged to the FHLB. As of December 31, 2009, the Corporation had $6.0 billion of outstanding borrowings from the FHLB with remaining maturities ranging from less than 3 months to 5 years. Another source of funding, if needed, would be liquid assets, which totaled $7.7 billion at December 31, 2009, compared to $6.5 billion at December 31, 2008, including cash and due from banks, federal funds sold and securities purchased under agreements to resell, interest-bearing deposits with the FRB and other banks, other short-term investments and unencumbered investment securities available-for-sale. Additionally, if market conditions were to permit, the Corporation could issue up to $12.8 billion of debt at December 31, 2009 under an existing $15 billion medium-term senior note program which allows its principal banking subsidiary to issue debt with maturities between one year and 30 years.

The Corporation participates in the voluntary Temporary Liquidity Guarantee Program (the TLG Program) announced by the FDIC in October 2008 and amended in March 2009, for certain debt issuances prior to October 2009. At December 31, 2009, there was approximately $7 million of senior unsecured debt outstanding in the form of bank-to-bank deposits guaranteed by the FDIC issued under the TLG Program. For more information regarding the TLG program, refer to Note 14 to the consolidated financial statements.

The ability of the Corporation and the Bank to raise funds at competitive rates is impacted by rating agencies' views of the credit quality, liquidity, capital and earnings of the Corporation and the Bank. As of December 31, 2009, the four major rating agencies had assigned the following ratings to long-term senior unsecured obligations of the Corporation and the Bank. A security rating is not a recommendation to buy, sell, or hold securities and may be subject to revision or withdrawal at any time by the assigning rating agency. Each rating should be evaluated independently of any other rating.

December 31, 2009	Comerica Incorporated	Comerica Bank

Standard and Poor's	A-	A
Moody's Investors Service	A2	A1
Fitch Ratings	A	A
Dominion Bond Rating Service	A	A (High)

The parent company held $5 million of cash and cash equivalents and $2.2 billion of short-term investments with its principle banking subsidiary at December 31, 2009. A source of liquidity for the parent company is dividends from its subsidiaries. As discussed in Note 22 to the consolidated financial statements, banking subsidiaries are subject to regulation and may be limited in their ability to pay dividends or transfer funds to the parent company. During 2010, the banking subsidiaries can pay dividends up to approximately $56 million plus 2010 net profits without prior regulatory approval. The Corporation has sufficient liquid assets at December 31, 2009 to fulfill its 2010 dividend payment obligations without reliance on dividend payments from banking subsidiaries. One measure of current parent company liquidity is investment in subsidiaries as a percentage of shareholders' equity. A ratio over 100 percent represents the reliance on subsidiary dividends to repay liabilities. As of December 31, 2009, the ratio was 81 percent. Refer to the "Contractual Obligations" table in this financial review for information on parent company future minimum payments on medium- and long-term debt.

The Corporation regularly evaluates its ability to meet funding needs in unanticipated, stressed environments. In conjunction with the quarterly 200 basis point interest rate shock analyses, discussed in the "Interest Rate Sensitivity" section of this financial review, liquidity ratios and potential funding availability are

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examined. Each quarter, the Corporation also evaluates its ability to meet liquidity needs under a series of broad events, distinguished in terms of duration and severity. The evaluation as of December 31, 2009 projected that sufficient sources of liquidity were available under each series of events.

Variable Interest Entities

The Corporation also holds a significant interest in certain unconsolidated variable interest entities (VIEs). These unconsolidated VIEs are principally indirect private equity and venture capital funds and low income housing limited partnerships. The Corporation defines a significant interest in a VIE as a subordinated interest that exposes the Corporation to a significant portion of the VIEs expected losses or residual returns. In general, a VIE is an entity that either (1) has an insufficient amount of equity to carry out its principal activities without additional subordinated financial support, (2) has a group of equity owners that are unable to make significant decisions about its activities, or (3) has a group of equity owners that do not have the obligation to absorb losses or the right to receive returns generated by its operations. If any of these characteristics is present, the entity is subject to a variable interests consolidation model, and consolidation is based on variable interests, not on ownership of the entity's outstanding voting stock. Variable interests are defined as contractual, ownership, or other monetary interests in an entity that change with fluctuations in the entity's net asset value. A company must consolidate an entity depending on whether the entity is a voting rights entity or a VIE. Refer to the "Principles of Consolidation" section in Note 1 to the consolidated financial statements for a summary of the Corporation's consolidation policy. Also, refer to Note 11 to the consolidated financial statements for a discussion of the Corporation's involvement in VIEs, including those in which the Corporation holds a significant interest but for which it is not the primary beneficiary.

Other Market Risks

Market risk related to the Corporation's trading instruments is not significant, as trading activities are limited. Certain components of the Corporation's noninterest income, primarily fiduciary income, are at risk to fluctuations in the market values of underlying assets, particularly equity and debt securities. Other components of noninterest income, primarily brokerage fees, are at risk to changes in the volume of market activity.

Share-based compensation expense recognized by the Corporation is dependent upon the fair value of stock options and restricted stock at the date of grant. The fair value of both stock options and restricted stock is impacted by the market price of the Corporation's stock on the date of grant and is at risk to changes in equity markets, general economic conditions and other factors. For further information regarding the valuation of stock options and restricted stock, refer to the "Critical Accounting Policies" section of this financial review.

Nonmarketable Equity Securities

At December 31, 2009, the Corporation had a $57 million portfolio of investments in indirect private equity and venture capital funds, with commitments of $27 million to fund additional investments in future periods. The value of these investments is at risk to changes in equity markets, general economic conditions and a variety of other factors. The majority of these investments are not readily marketable and are reported in other assets. The investments are individually reviewed for impairment on a quarterly basis by comparing the carrying value to the estimated fair value. For further information regarding the valuation of nonmarketable equity securities, refer to the "Critical Accounting Policies" section of this financial review. Income from indirect private equity and venture capital funds in 2009 was $3 million, which was more than offset by $15 million of write-downs and

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expenses recognized on such investments in 2009. The following table provides information on the Corporation's indirect private equity and venture capital funds investment portfolio.

	December 31, 2009

	(dollar amounts in millions)
Number of investments		133
Balance of investments	$	57
Largest single investment		6
Commitments to fund additional investments		27

OPERATIONAL RISK

Operational risk represents the risk of loss resulting from inadequate or failed internal processes, people and systems, or from external events. The definition includes legal risk, which is the risk of loss resulting from failure to comply with laws and regulations as well as prudent ethical standards and contractual obligations. It also includes the exposure to litigation from all aspects of an institution's activities. The definition does not include strategic or reputational risks. Although operational losses are experienced by all companies and are routinely incurred in business operations, the Corporation recognizes the need to identify and control operational losses and seeks to limit losses to a level deemed appropriate by management after considering the nature of the Corporation's business and the environment in which it operates. Operational risk is mitigated through a system of internal controls that are designed to keep operating risks at appropriate levels. The Operational Risk Management Committee monitors risk management techniques and systems. The Corporation has developed a framework that includes a centralized operational risk management function and business/support unit risk coordinators responsible for managing operational risk specific to the respective business lines.

In addition, internal audit and financial staff monitor and assess the overall effectiveness of the system of internal controls on an ongoing basis. Internal Audit reports the results of reviews on the controls and systems to management and the Audit Committee of the Board. The internal audit staff independently supports the Audit Committee oversight process. The Audit Committee serves as an independent extension of the Board.

COMPLIANCE RISK

Compliance risk represents the risk of regulatory sanctions, reputational impact or financial loss resulting from the Corporation's failure to comply with regulations and standards of good banking practice. Activities which may expose the Corporation to compliance risk include, but are not limited to, those dealing with the prevention of money laundering, privacy and data protection, community reinvestment initiatives, fair lending challenges resulting from the Corporation's expansion of its banking center network and employment and tax matters.

The Enterprise-Wide Compliance Committee, comprised of senior business unit managers, as well as managers responsible for compliance, audit and overall risk, oversees compliance risk. This enterprise-wide approach provides a consistent view of compliance across the organization. The Enterprise-Wide Compliance Committee also ensures that appropriate actions are implemented in business units to mitigate risk to an acceptable level.

BUSINESS RISK

Business risk represents the risk of loss due to impairment of reputation, failure to fully develop and execute business plans, failure to assess current and new opportunities in business, markets and products, and any other event not identified in the defined risk categories of credit, market, operational or compliance risks. Mitigation of the various risk elements that represent business risk is achieved through initiatives to help the Corporation better understand and report on the various risks. Wherever quantifiable, the Corporation uses situational analysis and other testing techniques to appreciate the scope and extent of these risks.

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CRITICAL ACCOUNTING POLICIES

The Corporation's consolidated financial statements are prepared based on the application of accounting policies, the most significant of which are described in Note 1 to the consolidated financial statements. These policies require numerous estimates and strategic or economic assumptions, which may prove inaccurate or subject to variations. Changes in underlying factors, assumptions or estimates could have a material impact on the Corporation's future financial condition and results of operations. The most critical of these significant accounting policies are the policies related to allowance for credit losses, valuation methodologies, pension plan accounting and income taxes. These policies are reviewed with the Audit Committee of the Board and are discussed more fully below.

ALLOWANCE FOR CREDIT LOSSES

The allowance for credit losses, which includes both the allowance for loan losses and the allowance for credit losses on lending-related commitments, is calculated with the objective of maintaining a reserve sufficient to absorb estimated probable losses. Management's determination of the adequacy of the allowance is based on periodic evaluations of the loan portfolio, lending-related commitments, and other relevant factors. This evaluation is inherently subjective as it requires an estimate of the loss content for each risk rating and for each impaired loan, an estimate of the amounts and timing of expected future cash flows, an estimate of the value of collateral, including the fair value of assets with few transactions (e.g., residential real estate developments and nonmarketable securities), many of which may be stressed, and an estimate of the probability of draw on unused commitments.

Allowance for Loan Losses

Loans for which it is probable that payment of interest and principal will not be made in accordance with the contractual terms of the loan agreement are considered impaired. Consistent with this definition, all nonaccrual and reduced-rate loans are impaired. The fair value of impaired loans is estimated using one of several methods, including the estimated collateral value, market value of similar debt or discounted cash flows. The valuation is reviewed and updated on a quarterly basis. While the determination of fair value may involve estimates, each estimate is unique to the individual loan, and none is individually significant.

The allowance for loan losses provides for probable losses that have been identified with specific customer relationships and for probable losses believed to be inherent in the loan portfolio that have not been specifically identified. Internal risk ratings are assigned to each business loan at the time of approval and are subject to subsequent periodic reviews by the Corporation's senior management. The Corporation performs a detailed credit quality review quarterly on both large business and certain large consumer and residential mortgage loans that have deteriorated below certain levels of credit risk and may allocate a specific portion of the allowance to such loans based upon this review. The Corporation defines business loans as those belonging to the commercial, real estate construction, commercial mortgage, lease financing and international loan portfolios. The portion of the allowance allocated to the remaining business loans is determined by applying estimated loss ratios to loans in each risk category. The portion of the allowance allocated to all other consumer and residential mortgage loans is determined by applying estimated loss ratios to various segments of the loan portfolios. Estimated loss ratios incorporate factors such as recent charge-off experience, current economic conditions and trends, changes in collateral values of properties securing loans, and trends with respect to past due and nonaccrual amounts, and are supported by underlying analysis, including information on migration and loss given default studies from each of the three major domestic geographic markets, as well as mapping to bond tables. Since a loss ratio is applied to a large portfolio of loans, any variation between actual and assumed results could be significant. In addition, a portion of the allowance is allocated to these remaining loans based on industry-specific risks inherent in certain portfolios that have experienced above average losses, including portfolio exposures to Small Business loans, high technology companies, retail trade (gasoline delivery) companies and automotive parts and tooling supply companies.

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A portion of the allowance is also maintained to cover factors affecting the determination of probable losses inherent in the loan portfolio that are not necessarily captured by the application of estimated loss ratios or identified industry specific risks including the imprecision in the risk rating system.

The principle assumption used in deriving the allowance for loan losses is the estimate of loss content for each risk rating. To illustrate, if recent loss experience dictated that the estimated loss ratios would be changed by five percent (of the estimate) across all risk ratings, the allowance for loan losses as of December 31, 2009 would change by approximately $50 million.

Allowance for Credit Losses on Lending-Related Commitments

Lending-related commitments for which it is probable that the commitment will be drawn (or sold) are reserved with the same estimated loss rates as loans, or with specific reserves. In general, the probability of draw for letters of credit is considered certain once the credit is assigned a risk rating that is generally consistent with regulatory defined substandard or doubtful. Other letters of credits and all unfunded commitments have a lower probability of draw, to which standard loan loss rates are applied.

For further discussion of the methodology used in the determination of the allowance for credit losses, refer to the "Allowance for Credit Losses" section in this financial review and Note 1 to the consolidated financial statements. To the extent actual outcomes differ from management estimates, additional provision for credit losses may be required that would adversely impact earnings in future periods. A substantial majority of the allowance is assigned to business segments. Any earnings impact resulting from actual outcomes differing from management estimates would primarily affect the Business Bank segment.

VALUATION METHODOLOGIES

Fair Value Measurement of Level 3 Financial Instruments

Fair value measurement and disclosure guidance establishes a three-level hierarchy for disclosure of assets and liabilities recorded at fair value. The classification of assets and liabilities within the hierarchy is based on whether the inputs used for measurement are observable or unobservable. Observable inputs reflect market-derived or market-based information obtained from independent sources, while unobservable inputs reflect management's estimates about market data. Level 1 and 2 valuations are based on quoted prices for identical instruments traded in active markets and quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-based valuation techniques for which all significant assumptions are observable in the market. Level 3 valuations are generated from model-based techniques that use at least one significant assumption not observable in the market. These unobservable assumptions reflect estimates of assumptions market participants would use in pricing the asset or liability. Valuation techniques include the use of option pricing models, discounted cash flow models and similar techniques.

Fair value measurement and disclosure guidance differentiates between those assets and liabilities required to be carried at fair value at every reporting period ("recurring") and those assets and liabilities that are only required to be adjusted to fair value under certain circumstances ("nonrecurring"). Level 3 financial instruments recorded at fair value on a recurring basis included primarily auction-rate securities at December 31, 2009. Additionally, from time to time, the Corporation may be required to record at fair value other financial assets or liabilities on a nonrecurring basis. Note 3 to the consolidated financial statements includes information about the

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extent to which fair value is used to measure assets and liabilities and the valuation methodologies and key inputs used.

For assets and liabilities recorded at fair value, the Corporation's policy is to maximize the use of observable inputs and minimize the use of unobservable inputs when developing fair value measurements for those items where there is an active market. In certain cases, when market observable inputs for model-based valuation techniques may not be readily available, the Corporation is required to make judgments about assumptions market participants would use in estimating the fair value of the financial instrument. The models used to determine fair value adjustments are periodically evaluated by management for relevance under current facts and circumstances.

Changes in market conditions may reduce the availability of quoted prices or observable data. For example, reduced liquidity in the capital markets or changes in secondary market activities could result in observable market inputs becoming unavailable. Therefore, when market data is not available, the Corporation would use valuation techniques requiring more management judgment to estimate the appropriate fair value.

At December 31, 2009, Level 3 financial assets recorded at fair value on a recurring basis totaled $916 million, or two percent of total assets, and consisted primarily of auction-rate securities. At December 31, 2009, there were no Level 3 financial liabilities recorded at fair value on a recurring basis.

At December 31, 2009, Level 3 financial assets recorded at fair value on a nonrecurring basis totaled $1.3 billion, or two percent of total assets, and consisted primarily of impaired loans and foreclosed property. At December 31, 2009, there were no financial liabilities recorded at fair value on a nonrecurring basis.

See Note 3 to the consolidated financial statements for a complete discussion on the Corporation's use of fair value and the related measurement techniques.

Restricted Stock and Stock Options

The fair value of share-based compensation as of the date of grant is recognized as compensation expense on a straight-line basis over the vesting period, taking into consideration the effect of retirement-eligible status and Capital Purchase Program restrictions on the vesting period. In 2009, the Corporation recognized total share-based compensation expense of $32 million. The option valuation model requires several inputs, including the risk-free interest rate, the expected dividend yield, expected volatility factors of the market price of the Corporation's common stock and the expected option life. For further discussion on the valuation model inputs, see Note 18 to the consolidated financial statements. Changes in input assumptions can materially affect the fair value estimates. The option valuation model is sensitive to the market price of the Corporation's stock at the grant date, which affects the fair value estimates and, therefore, the amount of expense recorded on future grants. Using the number of stock options granted in 2009 and the Corporation's stock price at December 31, 2009, a $5.00 per share increase in stock price would result in an increase in pretax expense of approximately $2 million, from the assumed base, over the options' vesting periods. The fair value of restricted stock is based on the market price of the Corporation's stock at the grant date. Using the number of restricted stock awards issued in 2009, a $5.00 per share increase in stock price would result in an increase in pretax expense of approximately $4 million, from the assumed base, over the awards' vesting periods. Refer to Notes 1 and 18 to the consolidated financial statements for further discussion of share-based compensation expense.

Nonmarketable Equity Securities

At December 31, 2009, the Corporation had a $57 million portfolio of investments in indirect private equity and venture capital investments, with commitments of $27 million to fund additional investments in future periods. The majority of these investments are not readily marketable. The investments are individually reviewed for impairment, on a quarterly basis, by comparing the carrying value to the estimated fair value. Fair value measurement guidance permits the measurement of investments of this type on the basis of net asset value per share, provided the net asset value is calculated by the fund in compliance with fair value measurement guidance

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applicable to investment companies. The Corporation bases its estimates of fair value for the majority of its indirect private equity and venture capital investments on its percentage ownership in the net asset value of the entire fund, as reported by the fund, after indication that the fund adheres to applicable fair value measurement guidance. For those funds where net asset value is not reported by the fund, the Corporation derives the fair value of the fund by estimating the fair value of each underlying investment in the fund. In addition to using qualitative information about each underlying investment, as provided by the fund, the Corporation gives consideration to information pertinent to the specific nature of the debt or equity investment, such as relevant market conditions, offering prices, operating results, financial conditions, exit strategy and other qualitative information, as available. The lack of an independent source to validate fair value estimates, including the impact of future capital calls and transfer restrictions, is an inherent limitation in the valuation process. The amount by which the carrying value exceeds the fair value that is determined to be other-than-temporary impairment is charged to current earnings and the carrying value of the investment is written down accordingly. While the determination of fair value involves estimates, no generic assumption is applied to all investments when evaluating for impairment. As such, each estimate is unique to the individual investment, and none is individually significant. The inherent uncertainty in the process of valuing equity securities for which a ready market is unavailable may cause our estimated values of these securities to differ significantly from the values that would have been derived had a ready market for the securities existed, and those differences could be material. The value of these investments is at risk to changes in equity markets, general economic conditions and a variety of other factors, which could result in an impairment charge in future periods.

Auction-Rate Securities

As a result of the Corporation's 2008 repurchase, at par, of auction-rate securities held by certain customers, the Corporation holds a portfolio of auction-rate securities recorded as investment securities available-for-sale and stated at fair value of $901 million at December 31, 2009. Due to the lack of a robust secondary auction-rate securities market with active fair value indications, fair value at December 31, 2009 was determined using an income approach based on a discounted cash flow model utilizing two significant assumptions in the model: discount rate (including a liquidity risk premium for certain securities) and workout period. The discount rate was calculated using credit spreads of the underlying collateral or similar securities plus a liquidity risk premium. The liquidity risk premium was based on observed industry auction-rate securities valuations by third parties. The workout period was based on an assessment of publicly available information on efforts to re-establish functioning markets for these securities and the Corporation's redemption experience.

The fair value of auction-rate securities recorded on the Corporation's consolidated balance sheets represents management's best estimate of the fair value of these instruments within the framework of existing accounting standards. Changes in the above material assumptions could result in significantly different valuations. For example, an increase or decrease in the liquidity premium of 100 basis points changes the fair value by $22 million.

The valuation of auction-rate securities is complex and is subject to a certain degree of management judgment. The inherent uncertainty in the process of valuing auction-rate securities for which a ready market is unavailable may cause estimated values of these auction-rate securities assets to differ from the values that would have been derived had a ready market for the auction-rate securities existed, and those differences could be significant. The use of an alternative valuation methodology or alternative approaches used to calculate material assumptions could result in significantly different estimated values for these assets. In addition, the value of auction-rate securities is at risk to changes in equity markets, general economic conditions and other factors.

PENSION PLAN ACCOUNTING

The Corporation has defined benefit pension plans in effect for substantially all full-time employees hired before January 1, 2007. Benefits under the plans are based on years of service, age and compensation. Assumptions are made concerning future events that will determine the amount and timing of required benefit payments, funding requirements and defined benefit pension expense. The three major assumptions are the

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discount rate used in determining the current benefit obligation, the long-term rate of return expected on plan assets and the rate of compensation increase. The assumed discount rate is determined by matching the expected cash flows of the pension plans to a yield curve that is representative of long-term, high-quality fixed income debt instruments as of the measurement date, December 31. The long-term rate of return expected on plan assets is set after considering both long-term returns in the general market and long-term returns experienced by the assets in the plan. The current target asset allocation model for the plans is detailed in Note 19 to the consolidated financial statements. The expected returns on these various asset categories are blended to derive one long-term return assumption. The assets are invested in certain collective investment and mutual funds, common stocks, U.S. Treasury and other U.S. government agency securities, and corporate and municipal bonds and notes. The rate of compensation increase is based on reviewing recent annual pension-eligible compensation increases as well as the expectation of future increases. The Corporation reviews its pension plan assumptions on an annual basis with its actuarial consultants to determine if the assumptions are reasonable and adjusts the assumptions to reflect changes in future expectations.

The key actuarial assumptions used to calculate 2010 expense for the defined benefit pension plans were a discount rate of 5.92 percent, a long-term rate of return on plan assets of 8.00 percent and a rate of compensation increase of 3.5 percent. Defined benefit pension expense in 2010 is expected to be approximately $19 million, a decrease of $38 million from the $57 million recorded in 2009, primarily driven by the improvement in plan asset values in 2009 and changes in plan demographics.

Changing the 2010 key actuarial assumptions discussed above by 25 basis points would have the following impact on defined benefit pension expense in 2010:

	25 Basis Point

	Increase			Decrease
	(in millions)
Key Actuarial Assumption
Discount rate	$	(6.0	)	$	6.0
Long-term rate of return		(3.6	)		3.6
Rate of compensation increase		2.6			(2.6	)

If the assumed long-term return on plan assets differs from the actual return on plan assets, the asset gains or losses are incorporated in the market-related value, which is used to determine the expected return on assets, over a five-year period. The Employee Benefits Committee, which consists of executive and senior managers from various areas of the Corporation, provides broad asset allocation guidelines to the asset managers, who report results and investment strategy quarterly to the Employee Benefits Committee. Actual asset allocations are compared to target allocations by asset category and investment returns for each class of investment are compared to expected results based on broad market indices.

The net funded status of the qualified defined benefit pension plan was an asset of $125 million at December 31, 2009. Due to the long-term nature of pension plan assumptions, actual results may differ significantly from the actuarial-based estimates. Differences between estimates and experience not recovered in the market or by future assumption changes are required to be recorded in shareholders' equity as part of accumulated other comprehensive income (loss) and amortized to defined benefit pension expense in future years. For further information, refer to Note 1 to the consolidated financial statements. The actuarial net gain in the qualified defined benefit plan recognized in accumulated other comprehensive income (loss) at December 31, 2009 was $89 million, net of tax. In 2009, the actual return on plan assets was $200 million, compared to an expected return on plan assets of $104 million. In 2008, the actual loss on plan assets was $293 million, compared to an expected return on plan assets of $100 million. The Corporation may make contributions from time to time to the qualified defined benefit plan to mitigate the impact of the actuarial losses on future years. A contribution of $100 million was made to the plan in 2009.

Defined benefit pension expense is recorded in "employee benefits" expense on the consolidated statements of income and is allocated to business segments based on the segment's share of salaries expense.

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Given the salaries expense included in 2009 segment results, defined benefit pension expense was allocated approximately 40 percent, 29 percent, 26 percent and 5 percent to the Retail Bank, Business Bank, Wealth & Institutional Management and Finance segments, respectively, in 2009.

INCOME TAXES

The calculation of the Corporation's income tax provision (benefit) and tax-related accruals is complex and requires the use of estimates and judgments. The provision for income taxes is based on amounts reported in the consolidated statements of income after deducting non-taxable items, principally income on bank-owned life insurance, and deducting tax credits related to investments in low income housing partnerships, and includes deferred income taxes on temporary differences between the income tax basis and financial accounting basis of assets and liabilities. Accrued taxes represent the net estimated amount due to or to be received from taxing jurisdictions, currently or in the future, and are included in "accrued income and other assets" or "accrued expenses and other liabilities" on the consolidated balance sheets. The Corporation assesses the relative risks and merits of tax positions for various transactions after considering statutes, regulations, judicial precedent and other available information and maintains tax accruals consistent with these assessments. The Corporation is subject to audit by taxing authorities that could question and/or challenge the tax positions taken by the Corporation.

Included in net deferred taxes are deferred tax assets. Deferred tax assets are evaluated for realization based on available evidence of loss carryback capacity, projected future reversals of existing taxable temporary differences and assumptions made regarding future events. A valuation allowance is provided when it is more-likely-than-not that some portion of the deferred tax asset will not be realized. At December 31, 2009, the Corporation carried a valuation allowance of $1 million for certain state deferred tax assets.

Changes in the estimate of accrued taxes occur due to changes in tax law, interpretations of existing tax laws, new judicial or regulatory guidance, and the status of examinations conducted by taxing authorities that impact the relative risks and merits of tax positions taken by the Corporation. These changes in the estimate of accrued taxes could be significant to the operating results of the Corporation. For further information on tax accruals and related risks, see Note 20 to the consolidated financial statements.

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SUPPLEMENTAL FINANCIAL DATA

The following table provides a reconciliation of non-GAAP financial measures used in this financial review with financial measures defined by GAAP.

		December 31

		2009			2008			2007			2006			2005
		(dollar amounts in millions)
Tier 1 capital (a)		$	7,704		$	7,805		$	5,640		$	5,657		$	5,399
Less:
	Fixed rate cumulative perpetual preferred stock		2,151			2,129			—			—			—
	Trust preferred securities		495			495			495			339			387

Tier 1 common capital		$	5,058		$	5,181		$	5,145		$	5,318		$	5,012

Risk-weighted assets (a)		$	61,815		$	73,702		$	75,102		$	70,486		$	64,390
Tier 1 common capital ratio			8.18	%		7.08	%		6.85	%		7.54	%		7.78	%

Total shareholders' equity		$	7,029		$	7,152		$	5,117		$	5,153		$	5,068
Less:
	Fixed rate cumulative perpetual preferred stock		2,151			2,129			—			—			—
	Goodwill		150			150			150			150			213
	Other intangible assets		8			12			12			14			20

Tangible common equity		$	4,720		$	4,861		$	4,955		$	4,989		$	4,835

Total assets		$	59,249		$	67,548		$	62,331		$	58,001		$	53,013
Less:
	Goodwill		150			150			150			150			213
	Other intangible assets		8			12			12			14			20

Tangible assets		$	59,091		$	67,386		$	62,169		$	57,837		$	52,780

Tangible common equity ratio			7.99	%		7.21	%		7.97	%		8.62	%		9.16	%

(a): Tier 1 capital and risk-weighted assets as defined by regulation.

The Tier 1 common capital ratio removes preferred stock and qualifying trust preferred securities from Tier 1 capital as defined by and calculated in conformity with bank regulations. The tangible common equity ratio removes preferred stock and the effect of intangible assets from capital and the effect of intangible assets from total assets. The Corporation believes these measurements are meaningful measures of capital adequacy used by investors, regulators, management and others to evaluate the adequacy of common equity and to compare against other companies in the industry.

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FORWARD-LOOKING STATEMENTS

This report includes forward-looking statements, as defined in the Private Securities Litigation Reform Act of 1995. In addition, the Corporation may make other written and oral communications from time to time that contain such statements. All statements regarding the Corporation's expected financial position, strategies and growth prospects and general economic conditions expected to exist in the future are forward-looking statements. The words, "anticipates," "believes," "feels," "expects," "estimates," "seeks," "strives," "plans," "intends," "outlook," "forecast," "position," "target," "mission," "assume," "achievable," "potential," "strategy," "goal," "aspiration," "outcome," "continue," "remain," "maintain," "trend," "objective," and variations of such words and similar expressions, or future or conditional verbs such as "will," "would," "should," "could," "might," "can," "may" or similar expressions, as they relate to the Corporation or its management, are intended to identify forward-looking statements.

The Corporation cautions that forward-looking statements are subject to numerous assumptions, risks and uncertainties, which change over time. Forward-looking statements speak only as of the date the statement is made, and the Corporation does not undertake to update forward-looking statements to reflect facts, circumstances, assumptions or events that occur after the date the forward-looking statements are made. Actual results could differ materially from those anticipated in forward-looking statements and future results could differ materially from historical performance.

In addition to factors mentioned elsewhere in this report or previously disclosed in the Corporation's SEC reports (accessible on the SEC's website at www.sec.gov or on the Corporation's website at www.comerica.com ), actual results could differ materially from forward-looking statements and future results could differ materially from historical performance due to a variety of reasons, including but not limited to, the following factors:

•: general political, economic or industry conditions, either domestically or internationally, may be less favorable than expected;
•: governmental monetary and fiscal policies may adversely affect the financial services industry and, therefore, impact the Corporation's financial condition and results of operations;
•: volatility and disruptions in the functioning of the financial markets and related liquidity issues could continue or worsen and, therefore, may adversely impact the Corporation's business, financial condition and results of operations;
•: changes in the performance and creditworthiness of our customers and other counterparties may adversely impact the Corporation's business, financial condition and results of operations;
•: the soundness of other financial institutions could adversely affect the Corporation;
•: recently enacted legislation, actions recently taken or proposed by the United States Department of Treasury, the Federal Deposit Insurance Corporation, the Federal Reserve Bank or other governmental entities, and legislation enacted in the future subject the Corporation to further regulation, and the impact and expiration of such legislation and regulatory actions may adversely affect the Corporation;
•: unfavorable developments concerning credit quality could adversely impact the Corporation's financial results;
•: problems faced by residential real estate developers could adversely affect the Corporation;
•: businesses or industries in which the Corporation has lending concentrations, including, but not limited to, the automotive production industry and the real estate business, could suffer a significant decline, which could adversely affect the Corporation;
•: the introduction, implementation, withdrawal, success and timing of business initiatives and strategies, including, but not limited to, the opening of new banking centers and plans to grow personal financial

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services and wealth management, may be less successful or may be different than anticipated, which could adversely affect the Corporation's business;

•: utilization of technology to efficiently and effectively develop, market and deliver new products and services;
•: operational difficulties or information security problems could adversely affect the Corporation's business and operations;
•: changes in the financial markets, including fluctuations in interest rates and their impact on deposit pricing, could adversely affect the Corporation's net interest income and balance sheet;
•: competitive product and pricing pressures among financial institutions within the Corporation's markets may change;
•: customer borrowing, repayment, investment and deposit practices generally may be different than anticipated;
•: management's ability to maintain and expand customer relationships may differ from expectations;
•: management's ability to retain key officers and employees may change;
•: legal and regulatory proceedings and related matters with respect to the financial services industry, including those directly involving the Corporation and its subsidiaries, could adversely affect the Corporation or the financial services industry in general;
•: changes in regulation or oversight may have a material adverse affect on the Corporation's operations;
•: methods of reducing risk exposures might not be effective;
•: terrorist activities or other hostilities may adversely affect the general economy, financial and capital markets, specific industries, and the Corporation; and
•: natural disasters, including, but not limited to, hurricanes, tornadoes, earthquakes, fires and floods, may adversely affect the general economy, financial and capital markets, specific industries, and the Corporation.

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CONSOLIDATED BALANCE SHEETS

Comerica Incorporated and Subsidiaries

			December 31

			2009			2008
			(in millions, except share data)
ASSETS
Cash and due from banks			$	774		$	913
Federal funds sold and securities purchased under agreements to resell				—			202
Interest-bearing deposits with banks				4,843			2,308
Other short-term investments				138			158
Investment securities available-for-sale				7,416			9,201
Commercial loans				21,690			27,999
Real estate construction loans				3,461			4,477
Commercial mortgage loans				10,457			10,489
Residential mortgage loans				1,651			1,852
Consumer loans				2,511			2,592
Lease financing				1,139			1,343
International loans				1,252			1,753

		Total loans		42,161			50,505
Less allowance for loan losses				(985	)		(770	)

		Net loans		41,176			49,735
Premises and equipment				644			683
Customers' liability on acceptances outstanding				11			14
Accrued income and other assets				4,247			4,334

		Total assets	$	59,249		$	67,548

LIABILITIES AND SHAREHOLDERS' EQUITY
Noninterest-bearing deposits			$	15,871		$	11,701
Money market and NOW deposits				14,450			12,437
Savings deposits				1,342			1,247
Customer certificates of deposit				6,413			8,807
Other time deposits				1,047			7,293
Foreign office time deposits				542			470

		Total interest-bearing deposits		23,794			30,254

		Total deposits		39,665			41,955
Short-term borrowings				462			1,749
Acceptances outstanding				11			14
Accrued expenses and other liabilities				1,022			1,625
Medium- and long-term debt				11,060			15,053

		Total liabilities		52,220			60,396
Fixed rate cumulative perpetual preferred stock, series F, no par value, $1,000 liquidation value per share:
	Authorized — 2,250,000 shares
	Issued — 2,250,000 shares at 12/31/09 and 12/31/08			2,151			2,129
Common stock — $5 par value:
	Authorized — 325,000,000 shares
	Issued — 178,735,252 shares at 12/31/09 and 12/31/08			894			894
Capital surplus				740			722
Accumulated other comprehensive loss				(336	)		(309	)
Retained earnings				5,161			5,345
Less cost of common stock in treasury — 27,555,623 shares at 12/31/09 and 28,244,967 shares at 12/31/08				(1,581	)		(1,629	)

		Total shareholders' equity		7,029			7,152

		Total liabilities and shareholders' equity	$	59,249		$	67,548

See notes to consolidated financial statements.

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CONSOLIDATED STATEMENTS OF INCOME

Comerica Incorporated and Subsidiaries

			Years Ended December 31

			2009			2008		2007
			(in millions, except per share data)
INTEREST INCOME
Interest and fees on loans			$	1,767		$	2,649	$	3,501
Interest on investment securities				329			389		206
Interest on short-term investments				9			13		23

		Total interest income		2,105			3,051		3,730
INTEREST EXPENSE
Interest on deposits				372			734		1,167
Interest on short-term borrowings				2			87		105
Interest on medium- and long-term debt				164			415		455

		Total interest expense		538			1,236		1,727

		Net interest income		1,567			1,815		2,003
Provision for loan losses				1,082			686		212

		Net interest income after provision for loan losses		485			1,129		1,791
NONINTEREST INCOME
Service charges on deposit accounts				228			229		221
Fiduciary income				161			199		199
Commercial lending fees				79			69		75
Letter of credit fees				69			69		63
Card fees				51			58		54
Foreign exchange income				41			40		40
Bank-owned life insurance				35			38		36
Brokerage fees				31			42		43
Net securities gains				243			67		7
Other noninterest income				112			82		150

		Total noninterest income		1,050			893		888
NONINTEREST EXPENSES
Salaries				687			781		844
Employee benefits				210			194		193

	Total salaries and employee benefits			897			975		1,037
Net occupancy expense				162			156		138
Equipment expense				62			62		60
Outside processing fee expense				97			104		91
FDIC insurance expense				90			16		5
Software expense				84			76		63
Other real estate expense				48			10		7
Legal fees				37			29		24
Litigation and operational losses				10			103		18
Customer services				4			13		43
Provision for credit losses on lending-related commitments				—			18		(1	)
Other noninterest expenses				159			189		206

		Total noninterest expenses		1,650			1,751		1,691

Income (loss) from continuing operations before income taxes				(115	)		271		988
Provision (benefit) for income taxes				(131	)		59		306

Income from continuing operations				16			212		682
Income from discontinued operations, net of tax				1			1		4

NET INCOME			$	17		$	213	$	686

Net income (loss) attributable to common shares			$	(118	)	$	192	$	680

Basic earnings per common share:
	Income (loss) from continuing operations		$	(0.80	)	$	1.28	$	4.43
	Net income (loss)			(0.79	)		1.29		4.45
Diluted earnings per common share:
	Income (loss) from continuing operations			(0.80	)		1.28		4.40
	Net income (loss)			(0.79	)		1.28		4.43
Cash dividends declared on common stock				30			348		393
Cash dividends declared per common share				0.20			2.31		2.56

See notes to consolidated financial statements.

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CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY

Comerica Incorporated and Subsidiaries

			Common Stock

	Nonredeemable Preferred Stock		Shares Outstanding			Amount		Capital Surplus			Accumulated Other Comprehensive Loss			Retained Earnings			Treasury Stock			Total Shareholders' Equity
	(in millions, except per share data)
BALANCE AT JANUARY 1, 2007	$	—		157.6		$	894	$	520		$	(324	)	$	5,230		$	(1,219	)	$	5,101
Net income		—		—			—		—			—			686			—			686
Other comprehensive income, net of tax		—		—			—		—			147			—			—			147

Total comprehensive income																					833
Cash dividends declared on common stock ($2.56 per share)		—		—			—		—			—			(393	)		—			(393	)
Purchase of common stock		—		(10.0	)		—		—			—			—			(580	)		(580	)
Net issuance of common stock under employee stock plans		—		2.4			—		(16	)		—			(26	)		139			97
Share-based compensation		—		—			—		59			—			—			—			59
Other		—		—			—		1			—			—			(1	)		—

BALANCE AT DECEMBER 31, 2007	$	—		150.0		$	894	$	564		$	(177	)	$	5,497		$	(1,661	)	$	5,117
Net income		—		—			—		—			—			213			—			213
Other comprehensive loss, net of tax		—		—			—		—			(132	)		—			—			(132	)

Total comprehensive income																					81
Cash dividends declared on common stock ($2.31 per share)		—		—			—		—			—			(348	)		—			(348	)
Purchase of common stock		—		—			—		—			—			—			(1	)		(1	)
Issuance of preferred stock and related warrant		2,126		—			—		124			—			—			—			2,250
Accretion of discount on preferred stock		3		—			—		—			—			(3	)		—			—
Net issuance of common stock under employee stock plans		—		0.5			—		(19	)		—			(14	)		33			—
Share-based compensation		—		—			—		53			—			—			—			53

BALANCE AT DECEMBER 31, 2008	$	2,129		150.5		$	894	$	722		$	(309	)	$	5,345		$	(1,629	)	$	7,152
Net income		—		—			—		—			—			17			—			17
Other comprehensive loss, net of tax		—		—			—		—			(27	)		—			—			(27	)

Total comprehensive loss																					(10	)
Cash dividends declared on preferred stock		—		—			—		—			—			(113	)		—			(113	)
Cash dividends declared on common stock ($0.20 per share)		—		—			—		—			—			(30	)		—			(30	)
Purchase of common stock		—		(0.1	)		—		—			—			—			(1	)		(1	)
Accretion of discount on preferred stock		22		—			—		—			—			(22	)		—			—
Net issuance of common stock under employee stock plans		—		0.8			—		(15	)		—			(36	)		48			(3	)
Share-based compensation		—		—			—		32			—			—			—			32
Other		—		—			—		1			—			—			1			2

BALANCE AT DECEMBER 31, 2009	$	2,151		151.2		$	894	$	740		$	(336	)	$	5,161		$	(1,581	)	$	7,029

See notes to consolidated financial statements.

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CONSOLIDATED STATEMENTS OF CASH FLOWS

Comerica Incorporated and Subsidiaries

				Years Ended December 31

				2009			2008			2007
				(in millions)
OPERATING ACTIVITIES
	Net income			$	17		$	213		$	686
		Income from discontinued operations, net of tax			1			1			4

		Income from continuing operations, net of tax			16			212			682
	Adjustments to reconcile net income to net cash provided by operating activities:
		Provision for loan losses			1,082			686			212
		Provision for credit losses on lending-related commitments			—			18			(1	)
		Provision (benefit) for deferred income taxes			(112	)		(99	)		(53	)
		Depreciation and software amortization			122			114			96
		Auction-rate securities charge			—			88			—
		Lease income charge			—			38			—
		Net gain on early termination of leveraged leases			(8	)		—			—
		Share-based compensation expense			32			51			59
		Net amortization of securities			(5	)		(11	)		(3	)
		Net securities gains			(243	)		(67	)		(7	)
		Net gain on sales of businesses			(5	)		—			(3	)
		Gain on repurchase of medium- and long-term debt			(15	)		—			—
		Contribution to qualified pension plan			(100	)		(175	)		—
		Excess tax benefits from share-based compensation arrangements			—			—			(9	)
		Net decrease (increase) in trading securities			16			(6	)		61
		Net decrease in loans held-for-sale			4			99			14
		Net decrease in accrued income receivable			62			82			1
		Net (decrease) increase in accrued expenses			(311	)		(306	)		36
		Other, net			(445	)		137			(75	)
		Discontinued operations, net			1			1			4

			Net cash provided by operating activities		91			862			1,014
INVESTING ACTIVITIES
	Proceeds from sales of investment securities available-for-sale				8,785			156			7
	Proceeds from maturities of investment securities available-for-sale				2,253			1,667			882
	Purchases of investment securities available-for-sale				(9,011	)		(4,496	)		(3,519	)
	Sales (purchases) of Federal Home Loan Bank stock				82			(353	)		—
	Net decrease (increase) in loans				7,317			(259	)		(3,561	)
	Proceeds from early termination of leveraged leases				107			—			—
	Net increase in fixed assets				(74	)		(166	)		(189	)
	Net decrease in customers' liability on acceptances outstanding				3			34			8
	Proceeds from sales of businesses				7			—			3
	Discontinued operations, net				—			—			—

			Net cash provided by (used in) investing activities		9,469			(3,417	)		(6,369	)
FINANCING ACTIVITIES
	Net decrease in deposits				(2,010	)		(2,299	)		(1,295	)
	Net (decrease) increase in short-term borrowings				(1,287	)		(1,058	)		2,172
	Net decrease in acceptances outstanding				(3	)		(34	)		(8	)
	Proceeds from issuance of medium- and long-term debt				—			8,000			4,335
	Repayments of medium- and long-term debt				(3,683	)		(2,000	)		(1,529	)
	Repurchases of medium- and long-term debt				(197	)		—			—
	Proceeds from issuance of preferred stock and related warrant				—			2,250			—
	Proceeds from issuance of common stock under employee stock plans				—			1			89
	Excess tax benefits from share-based compensation arrangements				—			—			9
	Purchase of common stock for treasury				(1	)		(1	)		(580	)
	Dividends paid on common stock				(72	)		(395	)		(390	)
	Dividends paid on preferred stock				(113	)		—			—
	Discontinued operations, net				—			—			—

			Net cash (used in) provided by financing activities		(7,366	)		4,464			2,803

Net increase (decrease) in cash and cash equivalents					2,194			1,909			(2,552	)
Cash and cash equivalents at beginning of year					3,423			1,514			4,066

Cash and cash equivalents at end of year				$	5,617		$	3,423		$	1,514

Interest paid				$	619		$	1,266		$	1,703

Income taxes, tax deposits and tax-related interest paid				$	251		$	241		$	402

Noncash investing and financing activities:
	Loans transferred to other real estate			$	114		$	65		$	20
	Loans transferred from held-for-sale to portfolio				—			84			—
	Loans transferred from portfolio to held-for-sale				—			—			83

See notes to consolidated financial statements.

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Note 1 — Summary of Significant Accounting Policies

Organization

Comerica Incorporated (the Corporation) is a registered financial holding company headquartered in Dallas, Texas. The Corporation's major business segments are the Business Bank, the Retail Bank and Wealth & Institutional Management. For further discussion of each business segment, refer to Note 24. The core businesses are tailored to each of the Corporation's four primary geographic markets: Midwest, Western, Texas and Florida. The Corporation and its banking subsidiaries are regulated at both the state and federal levels.

The accounting and reporting policies of the Corporation conform to U.S. generally accepted accounting principles (GAAP) and prevailing practices within the banking industry. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from these estimates. Management evaluated subsequent events through February 25, 2009, the date the consolidated financial statements were issued.

The following summarizes the significant accounting policies of the Corporation applied in the preparation of the accompanying consolidated financial statements.

Accounting Standards Codification

In the third quarter 2009, the Corporation adopted Statement of Financial Accounting Standards (SFAS) No. 168, "The FASB Accounting Standards Codification and the Hierarchy of Generally Accepted Accounting Principles," (SFAS 168). SFAS 168 establishes the Financial Accounting Standards Board (FASB) Accounting Standards Codification (the Codification, or ASC) as the single source of authoritative, nongovernmental GAAP recognized by the FASB. Rules and interpretive releases of the Securities and Exchange Commission (SEC) are also sources of authoritative GAAP for SEC registrants. The Codification is not intended to change GAAP. Effective with the adoption of SFAS 168, all existing non-SEC accounting and reporting standards, except for grandfathered guidance and certain recently-issued standards not yet integrated into the Codification, were superseded and are considered nonauthoritative. References to GAAP in these Notes to Consolidated Financial Statements are provided under the Codification structure where applicable.

Principles of Consolidation

The consolidated financial statements include the accounts of the Corporation and its subsidiaries after elimination of all significant intercompany accounts and transactions. Certain amounts in the financial statements for prior years have been reclassified to conform to current financial statement presentation.

The Corporation consolidates variable interest entities (VIEs) in which it is the primary beneficiary. In general, a VIE is an entity that either (1) has an insufficient amount of equity to carry out its principal activities without additional subordinated financial support, (2) has a group of equity owners that are unable to make significant decisions about its activities or (3) has a group of equity owners that do not have the obligation to absorb losses or the right to receive returns generated by its operations. If any of these characteristics is present, the entity is subject to a variable interests consolidation model, and consolidation is based on variable interests, not on ownership of the entity's outstanding voting stock. Variable interests are defined as contractual, ownership or other money interests in an entity that change with fluctuations in the entity's net asset value. The primary beneficiary consolidates the VIE; the primary beneficiary is defined as the enterprise that absorbs a majority of expected losses or receives a majority of residual returns (if the losses or returns occur), or both. The Corporation consolidates entities not determined to be VIEs when it holds a majority (controlling) interest in the entity's outstanding voting stock. On January 1, 2009, the Corporation adopted new consolidation guidance,

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which defines noncontrolling interests as the portion of equity in a subsidiary not attributable, directly or indirectly, to the parent. The adoption of the new guidance was not material to the Corporation's financial condition and results of operations. Due to the insignificance of the amounts, noncontrolling (minority) interest in less than 100 percent owned consolidated subsidiaries is included in "capital surplus" on the consolidated balance sheets and the related net income (loss) attributable to noncontrolling (minority) interest in earnings is included in "other noninterest expenses" on the consolidated statements of income.

Equity investments in entities that are not VIEs where the Corporation owns less than a majority (controlling) interest and equity investments in entities that are VIEs where the Corporation is not the primary beneficiary are not consolidated. Rather, such investments are accounted for using either the equity method or cost method. The equity method is used for investments in corporate joint ventures and investments where the Corporation has the ability to exercise significant influence over the investee's operation and financial policies, which is generally presumed to exist if the Corporation owns more than 20 percent of the voting interest of the investee. Equity method investments are included in "accrued income and other assets" on the consolidated balance sheets, with income and losses recorded in "other noninterest income" on the consolidated statements of income. Unconsolidated equity investments that do not meet the criteria to be accounted for under the equity method are accounted for under the cost method. Cost method investments in publicly traded companies are included in "investment securities available-for-sale" on the consolidated balance sheets, with income (net of write-downs) recorded in "net securities gains" on the consolidated statements of income. Cost method investments in non-publicly traded companies are included in "accrued income and other assets" on the consolidated balance sheets, with income (net of write-downs) recorded in "other noninterest income" on the consolidated statements of income.

For further information regarding the Corporation's investments in VIEs, refer to Note 11.

Fair Value Measurements

Fair value measurement applies whenever accounting guidance requires or permits assets or liabilities to be measured at fair value. Fair value is defined as the exchange price that would be received to sell an asset or paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction (i.e., not a forced transaction, such as a liquidation or distressed sale) between market participants at the measurement date. Fair value is based on the assumptions market participants would use when pricing an asset or liability. Fair value measurements and disclosures guidance establishes a three-level fair value hierarchy that prioritizes the information used to develop fair value. The fair value hierarchy gives the highest priority to quoted prices in active markets and the lowest priority to unobservable data. Fair value measurements are separately disclosed by level within the fair value hierarchy. For assets and liabilities recorded at fair value, it is the Corporation's policy to maximize the use of observable inputs and minimize the use of unobservable inputs when developing fair value measurements for those items for which there is an active market.

In the first quarter 2009, the Corporation adopted new fair value measurement guidance related to determining fair value when the volume and level of activity for the asset or liability have significantly decreased. The new guidance requires an assessment of whether certain factors exist to indicate that the market for an instrument is not active at the measurement date. If, after evaluating those factors, the evidence indicates the market is not active, the Corporation must determine whether recent quoted transaction prices are associated with distressed transactions. If the Corporation concludes that the quoted prices are associated with distressed transactions, an adjustment to the quoted prices may be necessary or the Corporation may conclude that a change in valuation technique or the use of multiple techniques may be appropriate to estimate an instrument's fair value. The adoption of the new fair value measurement guidance impacted the estimated fair value of auction-rate securities at March 31, 2009, as the Corporation determined the market was not active for the auction-rate securities portfolio. The rate of redemption of the various types of auction-rate securities held by the

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Corporation during the first quarter 2009, which ranged from nominal to 20 percent, was a significant consideration in the determination of a reasonable market premium a buyer would require. As a result, the fair value of auction-rate securities remaining in the Corporation's investment portfolio at March 31, 2009 increased $36 million from December 31, 2008.

In the fourth quarter 2009, the Corporation adopted new guidance on the fair value measurement of liabilities. The new guidance clarifies that in circumstances in which a quoted price in an active market for an identical liability is not available, the Corporation is required to measure fair value using one or more of the following techniques: a valuation technique that uses the quoted price of the identical liability when traded as an asset or a quoted price for a similar liability when traded as an asset, or another valuation method that is consistent with the principles of fair value measurement guidance. The new guidance also clarifies that when estimating the fair value of a liability, the Corporation is not required to include a separate input or adjustments to other inputs relating to the existence of a restriction that prevents the transfer of the liability. The adoption of the new guidance was not material to the Corporation's financial condition and results of operations.

Also in the fourth quarter 2009, the Corporation adopted new fair value measurement guidance that permits the measurement of certain alternative investments on the basis of net asset value per share of the investment (or its equivalent). The Corporation has certain private equity and venture capital investments within the scope of the new guidance; however, adoption of the guidance was not material to the Corporation's financial condition or results of operations.

Fair value measurements for assets and liabilities where there exists limited or no observable market data and, therefore, are based primarily upon estimates, are often calculated based on the economic and competitive environment, the characteristics of the asset or liability and other factors. Therefore, the results cannot be determined with precision and may not be realized in an actual sale or immediate settlement of the asset or liability. Additionally, there may be inherent weaknesses in any calculation technique, and changes in the underlying assumptions used, including discount rates and estimates of future cash flows, could significantly affect the results of current or future values.

For further information about fair value measurements, refer to Note 3.

Other Short-Term Investments

Other short-term investments include trading securities and loans held-for-sale.

Trading securities are carried at market value. Realized and unrealized gains or losses on trading securities are included in "other noninterest income" on the consolidated statements of income.

Loans held-for-sale, typically residential mortgages and Small Business Administration loans, are carried at the lower of cost or market. Market value is determined in the aggregate for each portfolio.

Investment Securities

Debt securities held-to-maturity are those securities which the Corporation has the ability and management has the positive intent to hold to maturity as of the balance sheet dates. Debt securities held-to-maturity are recorded at cost, adjusted for amortization of premium and accretion of discount.

Debt securities that are not considered held-to-maturity and marketable equity securities are accounted for as securities available-for-sale and recorded at fair value, with unrealized gains and losses, net of income taxes, reported as a separate component of other comprehensive income (loss) (OCI).

Investment securities are reviewed quarterly for possible other-than-temporary impairment (OTTI). In the first quarter 2009, the Corporation adopted new guidance on debt and equity securities, related to recognition and presentation of other-than-temporary impairments. The new guidance changed the method for determining

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whether OTTI exists for debt securities by requiring an assessment of the likelihood of selling the security prior to recovering its amortized cost basis. It also changed the amount of an impairment charge to be recorded in the consolidated statements of income. If the Corporation intends to sell the security or it is more-likely-than-not that the Corporation will be required to sell the security prior to recovery of its amortized cost basis, the security would be written down to fair value with the full amount of any impairment charge recorded as a loss in "net securities gains" in the consolidated statements of income. If the Corporation does not intend to sell the security and it is more-likely-than-not that the Corporation will not be required to sell the security prior to recovery of its amortized cost basis, only the credit component of any impairment of a debt security would be recognized as a loss in "net securities gains" on the consolidated statements of income, with the remaining impairment recorded in OCI. The adoption of the guidance was not material to the Corporation's financial condition or results of operations.

The OTTI review for equity securities includes an analysis of the facts and circumstances of each individual investment and focuses on the severity of loss, the length of time the fair value has been below cost, the expectation for that security's performance, the financial condition and near-term prospects of the issuer, and management's intent and ability to hold the security to recovery. A decline in value of an equity security that is considered to be other-than-temporary is recorded as a loss in "net securities gains" on the consolidated statements of income.

Gains or losses on the sale of securities are computed based on the adjusted cost of the specific security sold.

For further information on investment securities, refer to Note 4.

Allowance for Credit Losses

The allowance for credit losses includes both the allowance for loan losses and the allowance for credit losses on lending-related commitments.

Allowance for Loan Losses

The allowance for loan losses represents management's assessment of probable losses inherent in the Corporation's loan portfolio. The allowance provides for probable losses that have been identified with specific customer relationships and for probable losses believed to be inherent in the loan portfolio that have not been specifically identified. Internal risk ratings are assigned to each business loan at the time of approval and are subject to subsequent periodic reviews by the Corporation's senior management. The Corporation defines business loans as those belonging to the commercial, real estate construction, commercial mortgage, lease financing and international loan portfolios. The Corporation performs a detailed credit quality review quarterly on both large business and certain large consumer and residential mortgage loans that have deteriorated below certain levels of credit risk. When these individual loans are impaired, the level of impairment is estimated using one of several methods, including the estimated collateral value, market value of similar debt or discounted expected cash flows. When fair value is less than current carrying value, the difference is charged-off when appropriate, or a valuation allowance is established within the allowance for loan losses. Those impaired loans not requiring an allowance represent loans for which the fair value of expected repayments or collateral exceeded the recorded investment in such loans. At December 31, 2009, substantially all impaired loans were evaluated based on fair value of related collateral. A portion of the allowance is allocated to the remaining business loans by applying estimated loss ratios to the loans within each risk rating, based on numerous factors identified below. In addition, a portion of the allowance is allocated to these remaining loans based on industry-specific risks inherent in certain portfolios that have experienced above average losses. The portion of the allowance allocated to all other consumer and residential mortgage loans is determined by applying estimated loss ratios to various segments of the loan portfolio. Estimated loss ratios for all portfolios are updated quarterly, incorporating factors such as recent charge-off experience, current economic conditions and trends, changes in

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collateral values of properties securing loans (using index-based estimates), and trends with respect to past due and nonaccrual amounts, and are supported by underlying analysis, including information on migration and loss given default studies from each of the Corporation's three largest domestic geographic markets (Midwest, Western and Texas), as well as mapping to bond tables. For collateral-dependent real estate loans, independent appraisals are obtained at loan inception and updated on an as-needed basis, generally at the time a loan is determined to be impaired and at least annually thereafter.

Actual loss ratios experienced in the future may vary from those estimated. The uncertainty occurs because factors may exist which affect the determination of probable losses inherent in the loan portfolio and are not necessarily captured by the application of estimated loss ratios or identified industry-specific risks. A portion of the allowance is maintained to capture these probable losses and reflects management's view that the allowance should recognize the margin for error inherent in the process of estimating expected loan losses. Factors that were considered in the evaluation of the adequacy of the Corporation's allowance include the inherent imprecision in the risk rating system which covers probable loan losses as a result of an inaccuracy in assigning risk ratings or stale ratings which may not have been updated for recent negative trends in particular credits. In the first quarter 2009, the Corporation refined the methodology used to estimate the imprecision in the risk rating system portion of the allowance by only applying the identified error rate in assigning risk ratings, based on semiannual reviews, solely to the loan population that was tested. Previously, the error rate was applied to a larger population of loans. This change in methodology reduced the allowance by approximately $16 million in the first quarter 2009.

The total allowance for loan losses is available to absorb losses from any segment within the portfolio. Unanticipated economic events, including political, economic and regulatory instability in countries where the Corporation has loans, could cause changes in the credit characteristics of the portfolio and result in an unanticipated increase in the allowance. Inclusion of other industry-specific portfolio exposures in the allowance, as well as significant increases in the current portfolio exposures, could also increase the amount of the allowance. Any of these events, or some combination thereof, may result in the need for additional provision for loan losses in order to maintain an allowance that complies with credit risk and accounting policies.

Loans deemed uncollectible are charged off and deducted from the allowance. The provision for loan losses and recoveries on loans previously charged off are added to the allowance.

Allowance for Credit Losses on Lending-Related Commitments

The allowance for credit losses on lending-related commitments provides for probable credit losses inherent in lending-related commitments, including unused commitments to extend credit, letters of credit and financial guarantees. Lending-related commitments for which it is probable that the commitment will be drawn (or sold) are reserved with the same estimated loss rates as loans, or with specific reserves. In general, the probability of draw for letters of credit is considered certain once the credit is assigned a risk rating that is generally consistent with regulatory defined substandard or doubtful. Other letters of credit and all unfunded commitments have a lower probability of draw, to which standard loan loss rates are applied. The allowance for credit losses on lending-related commitments is included in "accrued expenses and other liabilities" on the consolidated balance sheets, with the corresponding charge reflected in "provision for credit losses on lending-related commitments" in the noninterest expenses section on the consolidated statements of income.

Nonperforming Assets

Nonperforming assets consist of loans, including loans held-for-sale, and debt securities for which the accrual of interest has been discontinued, loans for which the terms have been renegotiated to less than market rates due to a serious weakening of the borrower's financial condition, and real estate which has been acquired through foreclosure and is awaiting disposition.

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A loan is impaired when it is probable that interest or principal payments will not be made in accordance with the contractual terms of the original loan agreement. Consistent with this definition, all nonaccrual and reduced-rate loans are impaired. Loans restructured in troubled debt restructurings bearing market rates of interest at the time of restructuring and performing in compliance with their modified terms (performing restructured loans) for a period of six months are considered impaired only in the calendar year of the restructuring.

Residential real estate loans, which consist of traditional residential mortgages and home equity loans and lines of credit, are generally placed on nonaccrual status and charged off to current appraised values, less costs to sell, during the foreclosure process, normally no later than 180 days past due. Other consumer loans are generally not placed on nonaccrual status and are charged off at no later than 120 days past due, earlier if deemed uncollectible. Business loans and debt securities are generally placed on nonaccrual status when management determines full collection of principal or interest is unlikely or when principal or interest payments are 90 days past due, unless the loan is fully collateralized and in the process of collection. At the time a loan or debt security is placed on nonaccrual status, interest previously accrued but not collected is charged against current income. Income on such loans and debt securities is then recognized only to the extent that cash is received and where future collection of principal is probable. Generally, a loan or debt security may be returned to accrual status when all delinquent principal and interest have been received and the Corporation expects repayment of the remaining contractual principal and interest, or when the loan or debt security is both well secured and in the process of collection.

Real estate acquired through foreclosure (foreclosed property) is carried at the lower of cost or fair value, less estimated costs to sell. Independent appraisals are obtained to substantiate the fair value of real estate transferred to foreclosed property at the time of foreclosure and updated at least annually or upon evidence of deterioration in the property's value. At the time of foreclosure, any excess of the related loan balance over fair value (less estimated costs to sell) of the property acquired is charged to the allowance for loan losses. Subsequent write-downs, operating expenses and losses upon sale, if any, are charged to noninterest expenses.

Premises and Equipment

Premises and equipment are stated at cost, less accumulated depreciation and amortization. Depreciation, computed on the straight-line method, is charged to operations over the estimated useful lives of the assets. The estimated useful lives are generally 10 years to 33 years for premises that the Corporation owns and three years to eight years for furniture and equipment. Leasehold improvements are amortized over the terms of their respective leases or 10 years, whichever is shorter.

Software

Capitalized software is stated at cost, less accumulated amortization. Capitalized software includes purchased software and capitalizable application development costs associated with internally-developed software. Amortization, computed on the straight-line method, is charged to operations over the estimated useful life of the software, which is generally five years. Capitalized software is included in "accrued income and other assets" on the consolidated balance sheets.

Goodwill

Goodwill is subject to impairment testing, which the Corporation conducts annually as of July 1 each year and on an interim basis if events or changes in circumstances between annual tests indicate the assets might be impaired. Under applicable accounting guidance, the goodwill impairment test is a two-step test. The first step of the goodwill impairment test compares the fair value of identified reporting units, which are a subset of the Corporation's operating segments, with their carrying amount, including goodwill. If the fair value of a reporting

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unit exceeds its carrying value, goodwill of the reporting unit is not impaired. If the fair value of the reporting unit is less than the carrying value, the second step must be performed to determine the implied fair value of the reporting unit's goodwill and the amount of goodwill impairment.

Additional information regarding goodwill and impairment testing can be found in Note 9.

Nonmarketable Equity Securities

The Corporation has a portfolio of investments in indirect private equity and venture capital funds. The majority of these investments are not readily marketable and are included in "accrued income and other assets" on the consolidated balance sheets. The investments are individually reviewed for impairment on a quarterly basis by comparing the carrying value to the estimated fair value. The amount by which the carrying value exceeds the fair value that is determined to be other-than-temporary impairment is charged to current earnings and the carrying value of the investment is written down accordingly.

The Corporation also holds restricted equity investments, which are securities the Corporation is required to hold for various reasons and consist primarily of Federal Home Loan Bank of Dallas (FHLB) and Federal Reserve Bank (FRB) stock. Restricted equity securities, classified in "accrued income and other assets" on the consolidated balance sheets, are not readily marketable and are recorded at cost (par value) and evaluated for impairment based on the ultimate recoverability of the par value. If the Corporation does not expect to recover the full par value, the amount by which the par value exceeds the ultimately recoverable value would be charged to current earnings and the carrying value of the investment would be written down accordingly.

Derivative Instruments and Hedging Activities

Derivative instruments are carried at fair value in either "accrued income and other assets" or "accrued expenses and other liabilities" on the consolidated balance sheets. The accounting for changes in the fair value (i.e., gains or losses) of a derivative instrument is determined by whether it has been designated and qualifies as part of a hedging relationship and, further, by the type of hedging relationship. For those derivative instruments that are designated and qualify as hedging instruments, the Corporation designates the hedging instrument, based upon the exposure being hedged, as either a fair value hedge or a cash flow hedge. For derivative instruments designated and qualifying as fair value hedges (i.e., hedging the exposure to changes in the fair value of an asset or a liability or an identified portion thereof that is attributable to a particular risk), the gain or loss on the derivative instrument, as well as the offsetting loss or gain on the hedged item attributable to the hedged risk, are recognized in current earnings during the period of the change in fair values. For derivative instruments that are designated and qualify as cash flow hedges (i.e., hedging the exposure to variability in expected future cash flows that is attributable to a particular risk), the effective portion of the gain or loss on the derivative instrument is reported as a component of other comprehensive income and reclassified into earnings in the same period or periods during which the hedged transaction affects earnings. The remaining gain or loss on the derivative instrument in excess of the cumulative change in the present value of future cash flows of the hedged item (i.e., the ineffective portion), if any, is recognized in current earnings during the period of change. For derivative instruments not designated as hedging instruments, the gain or loss is recognized in current earnings during the period of change.

For derivatives designated as hedging instruments at inception, the Corporation uses either the short-cut method or applies dollar offset or statistical regression analysis to assess effectiveness. The short-cut method is used for certain fair value hedges of medium- and long-term debt. This method allows for the assumption of zero hedge ineffectiveness and eliminates the requirement to further assess hedge effectiveness on these transactions. For hedge relationships to which the Corporation does not apply the short-cut method, either the dollar offset or statistical regression analysis is used at inception and for each reporting period thereafter to assess whether the derivative used has been and is expected to be highly effective in offsetting changes in the fair value or cash flows

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of the hedged item. All components of each derivative instrument's gain or loss are included in the assessment of hedge effectiveness. Net hedge ineffectiveness is recorded in "other noninterest income" on the consolidated statements of income.

On January 1, 2009, the Corporation adopted new guidance relating to disclosures about derivative instruments and hedging activities. This new guidance requires entities to provide greater transparency about (a) how and why an entity uses derivative instruments, (b) how derivative instruments and related hedged items are accounted for, and (c) how derivative instruments and related hedged items affect an entity's financial position, results of operations and cash flows. To meet those objectives, the guidance requires (1) qualitative disclosures about objectives for using derivatives by primary underlying risk exposure (e.g., interest rate, credit or foreign exchange rate) and by purpose or strategy (fair value hedge, cash flow hedge, net investment hedge and non-hedges), (2) information about the volume of derivative activity in a flexible format that the preparer believes is the most relevant and practicable, (3) tabular disclosures about balance sheet location and gross fair value amounts of derivative instruments, income statement and other comprehensive income location of gain and loss amounts on derivative instruments by type of contract, and (4) disclosures about credit-risk-related contingent features in derivative agreements.

Further information on the Corporation's derivative instruments and hedging activities is included in Note 10.

Standby and Commercial Letters of Credit and Financial Guarantees

Certain guarantee contracts or indemnification agreements issued or modified subsequent to December 31, 2002, that contingently require the Corporation, as guarantor, to make payments to the guaranteed party are initially measured at fair value and included in "accrued expenses and other liabilities" on the consolidated balance sheets. Further information on the Corporation's obligations under guarantees is included in Note 10.

Loan Origination Fees and Costs

On January 1, 2008, the Corporation prospectively implemented a refinement in the application of receivables guidance related to nonrefundable fees and other costs, which resulted in the deferral and amortization to net interest income of substantially all loan origination fees and costs over the life of the related loan or over the commitment period as a yield adjustment. Prior to January 1, 2008, the Corporation deferred and amortized business loan origination and commitment fees greater than $10 thousand and all Small Business Administration, residential mortgage and consumer loan origination fees and costs over the life of the related loan or over the commitment period as a yield adjustment. The impact of the refinement on 2008 results was a reduction in net interest income of $17 million, a reduction in the net interest margin of 3 basis points, a reduction in noninterest expenses of $44 million and an increase in net income of $17 million, or $0.11 per diluted share. The impact does not include an adjustment to cumulatively correct the application of the receivables guidance related to nonrefundable fees and other costs, as such an adjustment was deemed immaterial, based on the existing accounting changes and error corrections guidance on materiality. The Corporation also concluded that a retroactive application of the refinement to any prior periods would not have been material.

Loan fees on unused commitments and net origination fees related to loans sold are recognized in noninterest income.

Share-Based Compensation

In 2006, the Corporation adopted stock compensation guidance using the modified-prospective transition method. The Corporation recognizes share-based compensation expense using the straight-line method over the

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requisite service period for all stock awards, including those with graded vesting. Measurement and attribution of compensation cost for awards that were granted prior to 2006 continue to be based on the estimate of the grant-date fair value and attribution method used under prior accounting guidance.

The guidance adopted in 2006 requires that the expense associated with share-based compensation awards be recorded over the requisite service period. The requisite service period is the period an employee is required to provide service in order to vest in the award, which cannot extend beyond the retirement-eligible date (the date at which the employee is no longer required to perform any service to receive the share-based compensation). Prior to 2006, the Corporation recorded the expense associated with share-based compensation awards over the explicit service period (vesting period). Upon retirement, any remaining unrecognized costs related to share-based compensation awards retained after retirement were expensed.

The Corporation elected to adopt the alternative transition method provided in the 2006 guidance for calculating the tax effects of share-based compensation. The alternative transition method included simplified methods to establish the beginning balance of the additional paid-in capital pool (APIC pool) related to the tax effects of employee share-based compensation, and to determine the subsequent impact on the APIC pool and consolidated statements of cash flows of the tax effects of employee share-based compensation awards that were outstanding and fully or partially unvested upon adoption of the guidance.

Further information on the Corporation's share-based compensation plans is included in Note 18.

Defined Benefit Pension and Other Postretirement Costs

Defined benefit pension costs are charged to "employee benefits" expense on the consolidated statements of income and are funded consistent with the requirements of federal laws and regulations. Inherent in the determination of defined benefit pension costs are assumptions concerning future events that will affect the amount and timing of required benefit payments under the plans. These assumptions include demographic assumptions such as retirement age and mortality, a compensation rate increase, a discount rate used to determine the current benefit obligation and a long-term expected rate of return on plan assets. Net periodic defined benefit pension expense includes service cost, interest cost based on the assumed discount rate, an expected return on plan assets based on an actuarially derived market-related value of assets, amortization of prior service cost and amortization of net actuarial gains or losses. The market-related value used to determine the expected return on plan assets is based on fair value adjusted for the difference between expected returns and actual asset performance. The asset gains and losses are incorporated in the market-related value over a five-year period. Prior service costs include the impact of plan amendments on the liabilities and are amortized over the future service periods of active employees expected to receive benefits under the plan. Actuarial gains and losses result from experience different from that assumed and from changes in assumptions (excluding asset gains and losses not yet reflected in market-related value). Amortization of actuarial gains and losses is included as a component of net periodic defined benefit pension cost for a year if the actuarial net gain or loss exceeds 10 percent of the greater of the projected benefit obligation or the market-related value of plan assets. If amortization is required, the excess is amortized over the average remaining service period of participating employees expected to receive benefits under the plan.

Postretirement benefits are recognized in "employee benefits" expense on the consolidated statements of income during the average remaining service period of participating employees expected to receive benefits under the plan or the average remaining future lifetime of retired participants currently receiving benefits under the plan.

For further information regarding the Corporation's defined benefit pension and other postretirement plans, refer to Note 19.

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Income Taxes

The provision for income taxes is based on amounts reported in the consolidated statements of income (after deducting non-taxable items, principally income on bank-owned life insurance, and deducting tax credits related to investments in low income housing partnerships) and includes deferred income taxes on temporary differences between the income tax basis and financial accounting basis of assets and liabilities. Deferred tax assets are evaluated for realization based on available evidence of loss carry-back capacity, future reversals of existing taxable temporary differences, and assumptions made regarding future events. A valuation allowance is provided when it is more-likely-than-not that some portion of the deferred tax asset will not be realized. The provision for income taxes assigned to discontinued operations is based on statutory rates, adjusted for permanent differences generated by those operations.

The Corporation classifies interest and penalties on income tax liabilities in the "provision for income taxes" on the consolidated statements of income.

On January 1, 2008, the Corporation adopted new guidance on accounting for the income tax benefits of dividends on share-based payment awards. The new guidance requires the Corporation to recognize the income tax benefit realized from dividends charged to retained earnings and paid to employees for nonvested restricted stock awards as an increase to capital surplus. Prior to 2008, the income tax benefit for such dividends was recognized as a reduction of income tax expense. For a further discussion of income taxes, refer to Note 20.

Discontinued Operations

Components of the Corporation that have been or will be disposed of by sale, where the Corporation does not have a significant continuing involvement in the operations after the disposal, are accounted for as discontinued operations in all periods presented if significant to the consolidated financial statements. For further information on discontinued operations, refer to Note 26.

Earnings Per Share

On January 1, 2009, the Corporation adopted new earnings per share guidance related to determining whether instruments granted in share-based payment transactions are participating securities. The new guidance clarified that unvested share-based payment awards that contain nonforfeitable rights to dividends or dividend equivalents are considered participating securities and should be included in the calculation of basic earnings per share using the two-class method and was applied retrospectively to all prior periods presented. The impact of adoption on the years ended December 31, 2008 and 2007 is provided in the following table. For further earnings per share information, refer to Note 17.

		2008			2007

Basic earnings per common share:
	Income (loss) from continuing operations	$	(0.02	)	$	(0.04	)
	Net income (loss)		(0.02	)		(0.04	)
Diluted earnings per common share:
	Income (loss) from continuing operations	$	(0.01	)	$	—
	Net income (loss)		(0.01	)		—

Statements of Cash Flows

Cash and cash equivalents are defined as those amounts included in "cash and due from banks", "federal funds sold and securities purchased under agreements to resell" and "interest-bearing deposits with banks" on

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the consolidated balance sheets. Cash flows from discontinued operations are reported as separate line items within cash flows from operating, investing and financing activities in the consolidated statements of cash flows.

Other Comprehensive Income (Loss)

The Corporation has elected to present information on comprehensive income in the consolidated statements of changes in shareholders' equity and in Note 16.

Note 2 — Pending Accounting Pronouncements

In June 2009, the FASB issued SFAS No. 166, "Accounting for Transfers of Financial Assets, an amendment of FASB Statement No. 140," and in December 2009 issued Accounting Standards Update (ASU) No. 2009-16, "Transfers and Servicing (Topic 860): Accounting for Transfers of Financial Assets," (ASU 2009-16) to codify the guidance. ASU 2009-16 removes the concept of a qualifying special-purpose entity from ASC Topic 860, "Transfers and Servicing," and eliminates the exception for qualifying special-purpose entities from consolidation guidance. In addition, ASU 2009-16 establishes specific conditions for reporting a transfer of a portion of a financial asset as a sale. If the transfer does not meet established sale conditions, the transferor and transferee must account for the transfer as a secured borrowing. An enterprise that continues to transfer portions of a financial asset that do not meet the established sale conditions would be eligible to record a sale only after it has transferred all of its interest in that asset. The effective date is for fiscal years beginning after November 15, 2009. Accordingly, the Corporation will adopt the provisions of ASU 2009-16 in the first quarter 2010. The Corporation does not expect the adoption of the provisions of ASU 2009-16 to have a material effect on the Corporation's financial condition and results of operations.

In June 2009, the FASB issued SFAS No. 167, "Amendments to FASB Interpretation No. 46(R)," and in December 2009 issued ASU No. 2009-17, "Consolidation (Topic 810): Improvements in Financial Reporting by Enterprises Involved with Variable Interest Entities," (ASU 2009-17) to codify the guidance. ASU 2009-17 replaces the quantitative-based risks and rewards calculation for determining which enterprise, if any, is the primary beneficiary and is required to consolidate a VIE with a qualitative approach focused on identifying which enterprise has both the power to direct the activities of the VIE that most significantly impact the entity's economic performance and the obligation to absorb losses or the right to receive benefits that could be significant to the entity. In addition, ASU 2009-17 requires reconsideration of whether an entity is a VIE when any changes in facts and circumstances occur such that the holders of the equity investment at risk, as a group, lose the power to direct the activities of the entity that most significantly impact the entity's economic performance through loss of voting or similar rights. It also requires ongoing assessments of whether an enterprise is the primary beneficiary of a VIE and additional disclosures about an enterprise's involvement in VIEs. The effective date is for fiscal years beginning after November 15, 2009. Accordingly, the Corporation will adopt the provisions of ASU 2009-17 in the first quarter 2010. The Corporation evaluated its interest in certain entities to determine if these entities meet the definition of a VIE and whether the Corporation was the primary beneficiary under the provisions of ASU 2009-17, and concluded no additional entities require consolidation, except for two money market funds managed by the Corporation, which held $1.9 billion in assets at December 31, 2009. In January 2010, the FASB approved a deferral of ASU 2009-17 for certain investment entities and money market funds and announced plans to issue a related ASU in the first quarter of 2010. The ASU will defer the requirement to consolidate the two money market funds managed by the Corporation.

In January 2010, the FASB issued ASU No. 2010-06, "Fair Value Measurements and Disclosures (Topic 820): Improving Disclosures about Fair Value Measurements," (ASU 2010-06) to amend the Codification. ASU 2010-06 requires separate disclosure of significant transfers in and out of Level 1 and Level 2 fair value measurements and the reasons for the transfers, and disclosure of purchases, sales, issuances and settlements activity on a gross (rather than net) basis in the Level 3 reconciliation of fair value measurements for

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assets and liabilities measured at fair value on a recurring basis. In addition, ASU 2010-06 clarifies existing disclosures for level of disaggregation of fair value measurements of assets and liabilities, and inputs and valuation techniques used for fair value measurements in Levels 2 and 3. The effective date is for fiscal years beginning after December 15, 2009, except for the disclosures about activity on a gross basis in Level 3 fair value measurements, which are effective for fiscal years beginning after December 15, 2010. Accordingly, the Corporation will adopt the provisions of ASU 2010-06 in the first quarter 2010, except for the disclosures about activity on a gross basis in Level 3 fair value measurements, which the Corporation will adopt in the first quarter 2011. The Corporation does not expect the adoption of the provisions of ASU 2010-06 to have a material effect on the Corporation's financial condition and results of operations.

Note 3 — Fair Value Measurements

The Corporation utilizes fair value measurements to record fair value adjustments to certain assets and liabilities and to determine fair value disclosures. Investment securities available-for-sale, trading securities, derivatives and certain liabilities are recorded at fair value on a recurring basis. Additionally, from time to time, the Corporation may be required to record other assets and liabilities at fair value on a nonrecurring basis, such as impaired loans, other real estate (primarily foreclosed properties), indirect private equity and venture capital investments and certain other assets and liabilities. These nonrecurring fair value adjustments typically involve write-downs of individual assets or application of lower of cost or fair value accounting.

The Corporation categorizes assets and liabilities recorded at fair value into a three-level hierarchy, based on the markets in which the assets and liabilities are traded and the reliability of the assumptions used to determine fair value. These levels are:


	Level 1		Valuation is based upon quoted prices for identical instruments traded in active markets.
	Level 2		Valuation is based upon quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-based valuation techniques for which all significant assumptions are observable in the market.
	Level 3		Valuation is generated from model-based techniques that use at least one significant assumption not observable in the market. These unobservable assumptions reflect estimates of assumptions that market participants would use in pricing the asset or liability. Valuation techniques include use of option pricing models, discounted cash flow models and similar techniques.

Following is a description of the valuation methodologies and key inputs used to measure financial assets and liabilities recorded at fair value, as well as a description of the methods and significant assumptions used to estimate fair value disclosures for financial instruments not recorded at fair value in their entirety on a recurring basis. For financial assets and liabilities recorded at fair value, the description includes an indication of the level of the fair value hierarchy in which the assets or liabilities are classified.

Cash and due from banks, federal funds sold and securities purchased under agreements to resell, and interest-bearing deposits with banks

The carrying amount of these instruments approximates the estimated fair value.

Trading securities and associated liabilities

Securities held for trading purposes and associated liabilities are recorded at fair value and included in "other short-term investments" and "accrued expenses and other liabilities," respectively, on the consolidated balance sheets. Level 1 securities held for trading purposes include assets related to employee deferred compensation plans, which are invested in mutual funds and other securities traded on an active exchange, such

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as the New York Stock Exchange. Deferred compensation plan liabilities represent the fair value of the obligation to the employee, which corresponds to the fair value of the invested assets. Level 2 trading securities include municipal bonds and mortgage-backed securities issued by U.S. government-sponsored entities and corporate debt securities. Securities classified as Level 3 include securities in less liquid markets and securities not rated by a credit agency. The methods used to value trading securities are the same as the methods used to value investment securities available-for-sale, discussed below.

Loans held-for-sale

Loans held-for-sale, included in "other short-term investments" on the consolidated balance sheets, are recorded at the lower of cost or fair value. The fair value of loans held-for-sale is based on what secondary markets are currently offering for portfolios with similar characteristics. As such, the Corporation classifies loans held-for-sale subjected to nonrecurring fair value adjustments as Level 2.

Investment securities available-for-sale

Investment securities available-for-sale are recorded at fair value on a recurring basis. Fair value measurement is based upon quoted prices, if available. If quoted prices are not available or the market is deemed to be inactive at the measurement date and quoted prices are determined to be associated with distressed transactions, an adjustment to the quoted prices may be necessary or the Corporation may conclude that a change in valuation technique or the use of multiple valuation techniques may be appropriate to estimate an instrument's fair value. Level 1 securities include those traded on an active exchange, such as the New York Stock Exchange, U.S. Treasury securities that are traded by dealers or brokers in active over-the-counter markets and money market funds. Level 2 securities primarily include residential mortgage-backed securities issued by U.S. government-sponsored enterprises. Securities classified as Level 3, of which the substantial majority are auction-rate securities, represent securities in less liquid markets requiring significant management assumptions when determining fair value. Due to the lack of a robust secondary auction-rate securities market with active fair value indicators, fair value at December 31, 2009 and 2008 was determined using an income approach based on a discounted cash flow model utilizing two significant assumptions: discount rate (including a liquidity risk premium) and workout period. The discount rate was calculated using credit spreads of the underlying collateral or similar securities plus a liquidity risk premium. The liquidity risk premium was based on observed industry auction-rate securities valuations by third parties. The workout period was based on an assessment of publicly available information on efforts to re-establish functioning markets for these securities and the Corporation's redemption experience. The rate of redemption of the various types of auction-rate securities held by the Corporation during the year ended December 31, 2009, which ranged from nominal to approximately 45 percent, was a significant consideration in the determination of a reasonable market premium a buyer would require. For further information regarding auction-rate securities, refer to Note 4 to the consolidated financial statements.

Loans

The Corporation does not record loans at fair value on a recurring basis. However, periodically, the Corporation records nonrecurring adjustments to the carrying value of loans based on fair value measurements. Loans for which it is probable that payment of interest or principal will not be made in accordance with the contractual terms of the original loan agreement are considered impaired. Impaired loans where an allowance is established based on the fair value of collateral require classification in the fair value hierarchy. When the fair value of the collateral is based on an observable market price or a current appraised value, the Corporation classifies the impaired loan as nonrecurring Level 2. When a current appraised value is not available or management determines the fair value of the collateral is further impaired below the appraised value and there is no observable market price, the Corporation classifies the impaired loan as nonrecurring Level 3.

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Business loans consist of commercial, real estate construction, commercial mortgage, lease financing and international loans. The estimated fair value for variable rate business loans that reprice frequently is based on carrying values adjusted for estimated credit losses and other adjustments that would be expected to be made by a market participant in an active market. The fair value for other business loans, and consumer and residential mortgage loans are estimated using a discounted cash flow model that employs interest rates currently offered on the loans, adjusted by an amount for estimated credit losses and other adjustments that would be expected to be made by a market participant in an active market. The rates take into account the expected yield curve, as well as an adjustment for prepayment risk, when applicable.

Customers' liability on acceptances outstanding and acceptances outstanding

The carrying amount approximates the estimated fair value.

Derivative assets and liabilities

Substantially all of the derivative instruments held or issued by the Corporation for risk management or customer-initiated activities are traded in over-the-counter markets where quoted market prices are not readily available. For those derivative instruments, the Corporation measures fair value using internally developed models that use primarily market observable inputs, such as yield curves and option volatilities, and include the value associated with counterparty credit risk. As such, the Corporation classifies those derivative instruments as recurring Level 2. Examples of Level 2 derivative instruments are interest rate swaps, energy and foreign exchange derivative contracts.

The Corporation also holds a portfolio of warrants for generally nonmarketable equity securities. These warrants are primarily from high technology, non-public companies obtained as part of the loan origination process. Warrants which contain a net exercise provision or a non-contingent put right embedded in the warrant agreement are accounted for as derivatives and recorded at fair value using a Black-Scholes valuation model with five inputs: risk-free rate, expected life, volatility, exercise price, and the per share market value of the underlying company. The Corporation classifies warrants accounted for as derivatives as recurring Level 3.

Foreclosed property

Upon transfer from the loan portfolio, foreclosed property is adjusted to and subsequently carried at the lower of carrying value or fair value. Fair value is based upon independent market prices, appraised value or management's estimation of the value. When the fair value of the collateral is based on an observable market price or a current appraised value, the Corporation classifies the foreclosed property as nonrecurring Level 2. When a current appraised value is not available or management determines the fair value of the foreclosed property is further impaired below the appraised value and there is no observable market price, the Corporation classifies the foreclosed property as nonrecurring Level 3.

Nonmarketable equity securities

The Corporation has a portfolio of indirect (through funds) private equity and venture capital investments. These funds generally cannot be redeemed and the majority are not readily marketable. Distributions from funds are received by the Corporation as the result of liquidation of underlying investments of the funds and/or as income distributions. It is estimated that the underlying assets of the funds will be liquidated over a period of up to 15 years. The value of these investments is at risk to changes in equity markets, general economic conditions and a variety of other factors. The investments are individually reviewed for impairment on a quarterly basis by comparing the carrying value to the estimated fair value. Fair value measurement guidance permits the measurement of investments of this type on the basis of net asset value, provided the net asset value is calculated by the fund in compliance with fair value measurement guidance applicable to investment companies. Where

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there is not a readily determinable fair value, the Corporation estimates fair value for indirect private equity and venture capital investments based on percentage ownership in the net asset value of the entire fund, as reported by the fund, after indication that the fund adheres to applicable fair value measurement guidance. For those funds where the net asset value is not reported by the fund, the Corporation derives the fair value of the fund by estimating the fair value of each underlying investment in the fund. In addition to using qualitative information about each underlying investment, as provided by the fund, the Corporation gives consideration to information pertinent to the specific nature of the debt or equity investment, such as relevant market conditions, offering prices, operating results, financial conditions, exit strategy and other qualitative information, as available. The lack of an independent source to validate fair value estimates, including the impact of future capital calls and transfer restrictions, is an inherent limitation in the valuation process. At December 31, 2009, there was approximately $3 million of unfunded commitments related to the funds subjected to nonrecurring fair value adjustments.

The Corporation also holds restricted equity investments, primarily FHLB and FRB stock. Restricted equity securities are not readily marketable and are recorded at cost (par value) and evaluated for impairment based on the ultimate recoverability of the par value. No significant observable market data for these instruments is available. The Corporation considers positive and negative evidence, including the profitability and asset quality of the issuer, dividend payment history and recent redemption experience, when determining the ultimate recoverability of the par value. The Corporation's investment in FHLB stock totaled $271 million and $353 million at December 31, 2009 and 2008, respectively, and its investment in FRB stock totaled $59 million at both December 31, 2009 and 2008. The Corporation believes its investments in FHLB and FRB stock are ultimately recoverable at par.

The Corporation classifies nonmarketable equity securities subjected to nonrecurring fair value adjustments as Level 3.

Loan servicing rights

Loan servicing rights are subject to impairment testing. A valuation model is used for impairment testing, which utilizes a discounted cash flow analysis using interest rates and prepayment speed assumptions currently quoted for comparable instruments and a discount rate determined by management. If the valuation model reflects a value less than the carrying value, loan servicing rights are adjusted to fair value through a valuation allowance as determined by the model. As such, the Corporation classifies loan servicing rights subjected to nonrecurring fair value adjustments as Level 3.

Goodwill

Goodwill is subject to impairment testing that requires an estimate of the fair value of the Corporation's reporting units. Estimating the fair value of reporting units is a subjective process involving the use of estimates and judgments, particularly related to future cash flows, discount rates (including market risk premiums) and market multiples. The fair values of the reporting units were determined using a blend of two commonly used valuation techniques, the market approach and the income approach. The Corporation gives consideration to two valuation techniques, as either technique can be an indicator of value. For the market approach, valuations of reporting units were based on an analysis of relevant price multiples in market trades in industries similar to the reporting unit. Market trades do not consider a control premium associated with an acquisition or a sale transaction. For the income approach, estimated future cash flows and terminal value (value at the end of the cash flow period, based on price multiples) were discounted. The discount rate was based on the imputed cost of equity capital. Material assumptions used in the valuation models included the comparable public company price multiples used in the terminal value, future cash flows and the market risk premium component of the discount rate. Due to the general uncertainty and depressed earning capacity in the financial services industry as

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of the measurement date, the Corporation concluded that the valuation under the income approach more clearly reflected the long-term future earning capacity of the reporting unit than the valuation under the market approach, and thus gave greater weight to the income approach.

If goodwill impairment testing resulted in impairment, the Corporation would classify goodwill subjected to nonrecurring fair value adjustments as Level 3. Additional information regarding goodwill impairment testing can be found in Notes 1 and 9.

Deposit liabilities

The estimated fair value of checking, savings and certain money market deposit accounts is represented by the amounts payable on demand. The carrying amount of deposits in foreign offices approximates their estimated fair value, while the estimated fair value of term deposits is calculated by discounting the scheduled cash flows using the year-end rates offered on these instruments.

Short-term borrowings

The carrying amount of federal funds purchased, securities sold under agreements to repurchase and other short-term borrowings approximates the estimated fair value.

Medium- and long-term debt

The carrying value of variable-rate FHLB advances approximates the estimated fair value. The estimated fair value of the Corporation's remaining variable-and fixed-rate medium- and long-term debt is based on quoted market values. If quoted market values are not available, the estimated fair value is based on the market values of debt with similar characteristics.

Credit-related financial instruments

The estimated fair value of unused commitments to extend credit and standby and commercial letters of credit is represented by the estimated cost to terminate or otherwise settle the obligations with the counterparties. This amount is approximated by the fees currently charged to enter into similar arrangements, considering the remaining terms of the agreements and any changes in the credit quality of counterparties since the agreements were executed. This estimate of fair value does not take into account the significant value of the customer relationships and the future earnings potential involved in such arrangements as the Corporation does not believe that it would be practicable to estimate a representational fair value for these items.

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Assets and Liabilities Recorded at Fair Value on a Recurring Basis

The table below presents the recorded amount of assets and liabilities measured at fair value on a recurring basis.

					Total		Level 1		Level 2		Level 3

					(in millions)
December 31, 2009
	Trading securities				$	107	$	86	$	21	$	—
	Investment securities available-for-sale:
		U.S. Treasury and other U.S. government agency securities				103		103		—		—
		Government-sponsored enterprise residential mortgage-backed securities				6,261		—		6,261		—
		State and municipal securities (a)				47		—		1		46
		Corporate debt securities:
			Auction-rate debt securities			150		—		—		150
			Other corporate debt securities			50		—		43		7
		Equity and other non-debt securities:
			Auction-rate preferred securities			706		—		—		706
			Money market and other mutual funds			99		99		—		—

				Total investment securities available-for-sale		7,416		202		6,305		909
	Derivative assets					675		—		668		7

	Total assets at fair value				$	8,198	$	288	$	6,994	$	916

	Derivative liabilities				$	410	$	—	$	410	$	—
	Other liabilities (b)					86		86		—		—

	Total liabilities at fair value				$	496	$	86	$	410	$	—

December 31, 2008
	Trading securities				$	124	$	80	$	10	$	34
	Investment securities available-for-sale:
		U.S. Treasury and other U.S. government agency securities				79		79		—		—
		Government-sponsored enterprise residential mortgage-backed securities				7,861		—		7,861		—
		State and municipal securities (a)				66		—		1		65
		Corporate debt securities:
			Auction-rate debt securities			147		—		—		147
			Other corporate debt securities			42		—		37		5
		Equity and other non-debt securities:
			Auction-rate preferred securities			936		—		—		936
			Money market and other mutual funds			70		70		—		—

				Total investment securities available-for-sale		9,201		149		7,899		1,153
	Derivative assets					1,123		—		1,115		8

	Total assets at fair value				$	10,448	$	229	$	9,024	$	1,195

	Derivative liabilities				$	671	$	—	$	671	$	—
	Other liabilities (b)					85		80		—		5

	Total liabilities at fair value				$	756	$	80	$	671	$	5

(a): Primarily auction-rate securities.
(b): Primarily deferred compensation plans.

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The table below summarizes the changes in Level 3 assets and liabilities measured at fair value on a recurring basis for the years ended December 31, 2009 and 2008.

						Net Realized/Unrealized Gains (Losses)

						Recorded in Earnings												Transfers In and/or Out of Level 3
				Balance at Beginning of Period		Recorded in Earnings						Recorded in Other Comprehensive Income (Pre-tax)			Purchases, Sales, Issuances and Settlements, Net					Balance at End of Period
				Balance at Beginning of Period		Realized			Unrealized			Recorded in Other Comprehensive Income (Pre-tax)			Purchases, Sales, Issuances and Settlements, Net					Balance at End of Period
				(in millions)
Year Ended December 31, 2009
	Trading securities			$	34	$	—		$	—		$	—		$	(34	)	$	—	$	—
	Investment securities available-for-sale:
		State and municipal securities (a)			65		—			—			(2	)		(17	)		—		46
		Auction-rate debt securities			147		—			—			5			(2	)		—		150
		Other corporate debt securities			5		—			2			—			—			—		7
		Auction-rate preferred securities			936		14			—			13			(257	)		—		706

			Total investment securities available-for-sale		1,153		14			2			16			(276	)		—		909
	Derivative assets (warrants)				8		—			4			—			(5	)		—		7
	Other liabilities				5		(2	)		—			—			(7	)		—		—
Year Ended December 31, 2008
	Trading securities			$	—	$	—		$	—		$	—		$	31		$	3	$	34
	Investment securities available-for-sale:
		State and municipal securities (a)			1		—			—			(3	)		67			—		65
		Auction-rate debt securities			—		—			—			(11	)		158			—		147
		Other corporate debt securities			2		—			4			—			(1	)		—		5
		Auction-rate preferred securities			—		4			—			(18	)		950			—		936

			Total investment securities available-for-sale		3		4			4			(32	)		1,174			—		1,153
	Derivative assets (warrants)				23		2			(9	)		—			(8	)		—		8
	Other liabilities				—		—			(5	)		—			—			—		5

(a): Primarily auction-rate securities

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The table below presents the income statement classification of realized and unrealized gains and losses due to changes in fair value recorded in earnings for the years ended December 31, 2009 and 2008 for recurring Level 3 assets and liabilities, as shown in the previous table.

				Net Securities Gains (Losses)						Other Noninterest Income					Discontinued Operations				Total

				Realized			Unrealized			Realized		Unrealized			Realized		Unrealized		Realized			Unrealized
				(in millions)
Year Ended December 31, 2009
	Investment securities available-for-sale:
		Other corporate debt securities		$	—		$	—		$	—	$	—		$	—	$	2	$	—		$	2
		Auction-rate preferred securities			14			—			—		—			—		—		14			—

			Total investment securities available-for-sale		14			—			—		—			—		2		14			2
	Derivative assets (warrants)				—			—			—		4			—		—		—			4
	Other liabilities				(2	)		—			—		—			—		—		(2	)		—
Year Ended December 31, 2008
	Investment securities available-for-sale:
		Other corporate debt securities		$	—		$	—		$	—	$	—		$	—	$	4	$	—		$	4
		Auction-rate preferred securities			4			—			—		—			—		—		4			—

			Total investment securities available-for-sale		4			—			—		—			—		4		4			4
	Derivative assets (warrants)				—			—			2		(9	)		—		—		2			(9	)
	Other liabilities				—			(5	)		—		—			—		—		—			(5	)

Assets and Liabilities Recorded at Fair Value on a Nonrecurring Basis

The Corporation may be required, from time to time, to record certain assets and liabilities at fair value on a nonrecurring basis. These include assets that are recorded at the lower of cost or fair value that were recognized

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at fair value below cost at the end of the period. Assets and liabilities recorded at fair value on a nonrecurring basis are included in the table below.

		Total		Level 1		Level 2		Level 3

		(in millions)
December 31, 2009
	Loans (a)	$	1,131	$	—	$	—	$	1,131
	Nonmarketable equity securities (b)		8		—		—		8
	Other assets (c)(d)		129		—		6		123

	Total assets at fair value		1,268	$	—	$	6	$	1,262

	Total liabilities at fair value	$	—	$	—	$	—	$	—

December 31, 2008
	Loans (a)	$	904	$	—	$	—	$	904
	Nonmarketable equity securities (b)		64		—		—		64
	Other assets (c)(d)		89		—		5		84

	Total assets at fair value	$	1,057	$	—	$	5	$	1,052

	Total liabilities at fair value	$	—	$	—	$	—	$	—

(a): The Corporation recorded $834 million and $533 million in fair value losses on impaired loans (included in "provision for loan losses" on the consolidated statements of income) during the years ended December 31, 2009 and 2008, respectively, based on the estimated fair value of the underlying collateral.
(b): The Corporation recorded $13 million and $14 million in fair value losses related to write-downs on nonmarketable equity securities (included in "other noninterest income" on the consolidated statements of income) during the years ended December 31, 2009 and 2008, respectively, based on the estimated fair value of the funds.
(c): Includes other real estate (primarily foreclosed properties), loans held-for-sale and loan servicing rights.
(d): The Corporation recorded $34 million and $7 million in fair value losses related to write-downs of other real estate, based on the estimated fair value of the underlying collateral, and recognized a net loss of $2 million and a net gain of $2 million on sales of other real estate during the years ended December 31, 2009 and 2008, respectively (included in "other noninterest expenses" on the consolidated statements of income).

Estimated Fair Values of Financial Instruments Not Recorded at Fair Value in their Entirety on a Recurring Basis

Disclosure of the estimated fair values of financial instruments, which differ from carrying values, often requires the use of estimates. In cases where quoted market values in an active market are not available, the Corporation uses present value techniques and other valuation methods to estimate the fair values of its financial instruments. These valuation methods require considerable judgment and the resulting estimates of fair value can be significantly affected by the assumptions made and methods used.

The amounts provided herein are estimates of the exchange price that would be received to sell an asset or paid to transfer a liability in an orderly transaction (i.e., not a forced transaction, such as a liquidation or distressed sale) between market participants at the measurement date. However, the calculated fair value estimates in many instances cannot be substantiated by comparison to independent markets and, in many cases,

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may not be realizable in a current sale of the financial instrument. The Corporation typically holds the majority of its financial instruments until maturity and thus does not expect to realize many of the estimated amounts disclosed. The disclosures also do not include estimated fair value amounts for items that are not defined as financial instruments, but which have significant value. These include such items as core deposit intangibles, the future earnings potential of significant customer relationships and the value of trust operations and other fee generating businesses. The Corporation believes the imprecision of an estimate could be significant.

The carrying amount and estimated fair value of financial instruments not recorded at fair value in their entirety on a recurring basis on the Corporation's consolidated balance sheets are as follows:

			December 31,

			2009						2008
			Carrying Amount			Estimated Fair Value			Carrying Amount			Estimated Fair Value
			(in millions)
Assets
	Cash and due from banks		$	774		$	774		$	913		$	913
	Federal funds sold and securities purchased under agreements to resell			—			—			202			202
	Interest-bearing deposits with banks			4,843			4,843			2,308			2,308
	Loans held-for-sale			30			30			34			34
	Total loans, net of allowance for loan losses (a)			41,176			41,098			49,735			50,799
	Customers' liability on acceptances outstanding			11			11			14			14
	Loan servicing rights			7			7			11			11
	Nonmarketable equity securities (b)			57			61			64			64
Liabilities
	Demand deposits (noninterest-bearing)			15,871			15,871			11,701			11,701
	Interest-bearing deposits			23,794			23,814			30,254			30,390

		Total deposits		39,665			39,685			41,955			42,091
	Short-term borrowings			462			462			1,749			1,749
	Acceptances outstanding			11			11			14			14
	Medium- and long-term debt			11,060			10,723			15,053			13,995
Credit-related financial instruments				(90	)		(115	)		(98	)		(136	)

(a): Included $1,131 million and $904 million of impaired loans recorded at fair value on a nonrecurring basis at December 31, 2009 and 2008, respectively.
(b): Included $8 million and $64 million of indirect private equity and venture capital investments recorded at fair value on a nonrecurring basis at December 31, 2009 and 2008, respectively.

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Note 4 — Investment Securities

A summary of the Corporation's investment securities available-for-sale follows:

			Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value

			(in millions)
December 31, 2009
	U.S. Treasury and other U.S. government agency securities		$	103	$	—	$	—	$	103
	Government-sponsored enterprise residential mortgage-backed securities			6,228		51		18		6,261
	State and municipal securities (a)			51		—		4		47
	Corporate debt securities:
		Auction-rate debt securities		156		—		6		150
		Other corporate debt securities		50		—		—		50
	Equity and other non-debt securities:
		Auction-rate preferred securities		711		8		13		706
		Money market and other mutual funds		99		—		—		99

Total investment securities available-for-sale			$	7,398	$	59	$	41	$	7,416

December 31, 2008
	U.S. Treasury and other U.S. government agency securities		$	79	$	—	$	—	$	79
	Government-sponsored enterprise residential mortgage-backed securities			7,624		242		5		7,861
	State and municipal securities (a)			69		—		3		66
	Corporate debt securities:
		Auction-rate debt securities		158		—		11		147
		Other corporate debt securities		42		—		—		42
	Equity and other non-debt securities:
		Auction-rate preferred securities		954		—		18		936
		Money market and other mutual funds		70		—		—		70

Total investment securities available-for-sale			$	8,996	$	242	$	37	$	9,201

(a): Primarily auction-rate securities.

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A summary of the Corporation's temporarily impaired investment securities available-for-sale follows:

			Temporarily Impaired

			Less than 12 months				Over 12 months				Total
			Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
			(in millions)
December 31, 2009
	U.S. Treasury and other U.S. government agency securities		$	—	$	—	$	—	$	—	$	—	$	—
	Government-sponsored enterprise residential mortgage-backed securities			1,609		18		—		—		1,609		18
	State and municipal securities (a)			—		—		46		4		46		4
	Corporate debt securities:
		Auction-rate debt securities		150		6		—		—		150		6
		Other corporate debt securities		—		—		—		—		—		—
	Equity and other non-debt securities:
		Auction-rate preferred securities		510		13		—		—		510		13
		Money market and other mutual funds		—		—		—		—		—		—

	Total temporarily impaired securities		$	2,269	$	37	$	46	$	4	$	2,315	$	41

December 31, 2008
	U.S. Treasury and other U.S. government agency securities		$	—	$	—	$	—	$	—	$	—	$	—
	Government-sponsored enterprise residential mortgage-backed securities			137		1		559		4		696		5
	State and municipal securities (a)			64		3		—		—		64		3
	Corporate debt securities:
		Auction-rate debt securities		147		11		—		—		147		11
		Other corporate debt securities		—		—		—		—		—		—
	Equity and other non-debt securities:
		Auction-rate preferred securities		936		18		—		—		936		18
		Money market and other mutual funds		—		—		—		—		—		—

	Total temporarily impaired securities		$	1,284	$	33	$	559	$	4	$	1,843	$	37

(a): Primarily auction-rate securities.

At December 31, 2009, the Corporation had 469 securities in an unrealized loss position, including 328 auction-rate preferred securities, 78 auction-rate corporate debt securities, 43 state and municipal auction-rate debt securities and 17 AAA-rated U.S. government-sponsored enterprise residential mortgage-backed securities (i.e., FMNA, FHLMC). The unrealized losses resulted from changes in market interest rates and liquidity, not from changes in the probability of contractual cash flows. The Corporation does not intend to sell the securities, and it is not more-likely-than-not that the Corporation will be required to sell the securities prior to recovery of amortized cost. Full collection of the amounts due according to the contractual terms of the securities is expected; therefore, the Corporation does not consider these investments to be other-than-temporarily impaired at December 31, 2009.

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Sales, calls and write-downs of investment securities available-for-sale resulted in realized gains and losses as follows:

		Years Ended December 31

		2009			2008			2007
		(in millions)
Securities gains		$	245		$	68		$	9
Securities losses			(2	)		(1	)		(2	)

	Total net securities gains	$	243		$	67		$	7

The table below summarizes the amortized cost and fair values of debt securities by contractual maturity. Securities with multiple maturity dates are classified in the period of final maturity. Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.

			December 31, 2009

			Amortized Cost		Fair Value
			(in millions)
Contractual maturity
	Within one year		$	147	$	147
	After one year through five years			7		7
	After five years through ten years			—		—
	After ten years			206		196

		Subtotal		360		350
Residential mortgage-backed securities				6,228		6,261
Equity and other nondebt securities:
	Auction-rate preferred securities			711		706
	Money market and other mutual funds			99		99

		Total investment securities available-for-sale	$	7,398	$	7,416

Included in the contractual maturity distribution in the table above were auction-rate securities with a total amortized cost and fair value of $206 million and $196 million, respectively. Auction-rate securities are long-term, floating rate instruments for which interest rates are reset at periodic auctions. At each successful auction, the Corporation has the option to sell the security at par value. Additionally, the issuers of auction-rate securities generally have the right to redeem or refinance the debt. As a result, the expected life of auction-rate securities may differ significantly from the contractual life.

At December 31, 2009, investment securities having a carrying value of $5.5 billion were pledged where permitted or required by law to secure $5.3 billion of liabilities, including public and other deposits, FHLB advances and derivative instruments. This included residential mortgage-backed securities of $3.3 billion pledged with the FHLB to secure advances of $3.2 billion at December 31, 2009. The remaining pledged securities of $2.2 billion were primarily with state and local government agencies to secure $2.0 billion of deposits and other liabilities.

In September 2008, the Corporation announced an offer to repurchase, at par, auction-rate securities held by certain retail and institutional clients that were sold through Comerica Securities, a broker/dealer subsidiary of Comerica Bank. Auction-rate securities that were the subject of functioning auctions or current calls or

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redemptions were not eligible for repurchase. The repurchase offers commenced in October 2008 and concluded in December 2008.

The following table summarizes auction-rate securities activity for the years ended December 31, 2009 and 2008.

		Par Value			Fair Value (a)			Repurchase Charge (b)		Securities Gains

		(in millions)
Balance at January 1, 2008		$	—		$	—
	Repurchased from customers		1,345			1,259		$	88
	Called or redeemed subsequent to repurchase		(84	)		(80	)			$	4
	Unrealized losses (c)		—			(32	)

Balance at December 31, 2008		$	1,261		$	1,147
	Called or redeemed subsequent to repurchase		(276	)		(262	)			$	14
	Unrealized gains (c)		—			16

Balance at December 31, 2009		$	985		$	901

(a): Recorded in "investment securities available-for-sale" on the consolidated balance sheets.
(b): Recorded in "litigation and operational losses" on the consolidated statements of income. Includes the difference between cost (par value) and fair value of the securities repurchased and other repurchase-related charges.
(c): Changes in fair value subsequent to repurchase recognized in accumulated other comprehensive income (loss).

Note 5 — Nonperforming Assets

The following table summarizes nonperforming assets, which consist of nonaccrual loans, reduced-rate loans and real estate acquired through foreclosure. Nonaccrual loans are those on which interest is not being recognized. Reduced-rate loans are those on which interest has been renegotiated to lower than market rates because of the weakened financial condition of the borrower.

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Nonaccrual and reduced-rate loans are included in the corresponding loan line items and real estate acquired through foreclosure is included in "accrued income and other assets" on the consolidated balance sheets.

				December 31

				2009		2008
				(in millions)
Nonaccrual loans:
	Commercial			$	238	$	205
	Real estate construction:
		Commerical Real Estate business line (a)			507		429
		Other business lines (b)			4		5

			Total real estate construction		511		434
	Commercial mortgage:
		Commerical Real Estate business line (a)			127		132
		Other business lines (b)			192		130

			Total commercial mortgage		319		262
	Residential mortgage				50		7
	Consumer				12		6
	Lease financing				13		1
	International				22		2

			Total nonaccrual loans		1,165		917
Reduced-rate loans					16		—

			Total nonperforming loans		1,181		917
Foreclosed property					111		66

			Total nonperforming assets	$	1,292	$	983

Loans past due 90 days or more and still accruing				$	101	$	125

Gross interest income that would have been recorded had the nonaccrual and reduced-rate loans performed in accordance with original terms				$	109	$	98

Interest income recognized				$	21	$	24

(a): Primarily loans to real estate investors and developers.
(b): Primarily loans secured by owner-occupied real estate.

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The following presents information regarding impaired loans and the related valuation allowance:

		December 31

		2009			2008			2007
		(in millions)
Average individually evaluated impaired loans for the year		$	1,078		$	690		$	264

Total nonaccrual loans		$	1,165		$	917		$	391
Total reduced-rate loans			16			—			13

	Total nonperforming loans		1,181			917			404
Total performing restructured loans			11			—			4

	Total impaired loans		1,192			917			408
Impaired loans excluded from individual evaluation			(51	)		(13	)		(4	)

	Individually evaluated impaired loans	$	1,141		$	904		$	404

Individually evaluated impaired loans requiring
	a valuation allowance	$	1,080		$	807		$	356

Valuation allowance on individually evaluated impaired loans		$	196		$	175		$	85

Note 6 — Allowance for Loan Losses

An analysis of changes in the allowance for loan losses follows:

		2009			2008			2007

		(dollar amounts in millions)
Balance at January 1		$	770		$	557		$	493
Loan charge-offs			(895	)		(500	)		(196	)
Recoveries on loans previously charged-off			27			29			47

	Net loan charge-offs		(868	)		(471	)		(149	)
Provision for loan losses			1,082			686			212
Foreign currency translation adjustment			1			(2	)		1

Balance at December 31		$	985		$	770		$	557

As a percentage of total loans			2.34	%		1.52	%		1.10	%

Note 7 — Significant Group Concentrations of Credit Risk

Concentrations of both on-balance sheet and off-balance sheet credit risk are controlled and monitored as part of credit policies. The Corporation is a regional financial services holding company with a geographic concentration of its on-balance-sheet and off-balance-sheet activities in Michigan, California and Texas.

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the definition. Outstanding loans and total exposure from loans, unused commitments and standby letters of credit to companies related to the automotive industry were as follows:

			December 31

			2009		2008
			(in millions)
Automotive loans:
	Production		$	941	$	1,459
	Dealer			3,430		4,655

		Total automotive loans	$	4,371	$	6,114

Total automotive exposure:
	Production		$	1,869	$	2,867
	Dealer			5,767		6,646

		Total automotive exposure	$	7,636	$	9,513

Further, the Corporation's portfolio of commercial real estate loans, which includes real estate construction and commercial mortgage loans, was as shown in the following table.

			December 31

			2009		2008
			(in millions)
Real estate construction loans:
	Commercial Real Estate business line (a)		$	2,988	$	3,831
	Other business lines (b)			473		646

		Total real estate construction loans		3,461		4,477
Commercial mortgage loans:
	Commercial Real Estate business line (a)			1,824		1,619
	Other business lines (b)			8,633		8,870

		Total commercial mortgage loans		10,457		10,489

		Total commercial real estate loans	$	13,918	$	14,966

Total unused commitments on commercial real estate loans			$	1,249	$	3,549

(a): Primarily loans to real estate investors and developers.
(b): Primarily loans secured by owner-occupied real estate.

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Note 8 — Premises and Equipment

A summary of premises and equipment by major category follows:

		December 31

		2009			2008
		(in millions)
Land		$	93		$	92
Buildings and improvements			754			753
Furniture and equipment			508			494

	Total cost		1,355			1,339
Less: Accumulated depreciation and amortization			(711	)		(656	)

	Net book value	$	644		$	683

The Corporation conducts a portion of its business from leased facilities and leases certain equipment. Rental expense for leased properties and equipment amounted to $84 million, $76 million and $65 million in 2009, 2008 and 2007, respectively. As of December 31, 2009, future minimum payments under operating leases and other long-term obligations were as follows:

		Years Ending December 31

		(in millions)
2010		$	112
2011			95
2012			70
2013			63
2014			58
Thereafter			479

	Total	$	877

Note 9 — Goodwill

Goodwill is subject to impairment testing annually and on an interim basis if events or changes in circumstances between annual tests indicate the assets might be impaired. The annual test of goodwill performed as of July 1, 2009 and 2008, and the tests performed on an interim basis between those dates, did not indicate that an impairment charge was required. The impairment test performed as of July 1, 2009 utilized assumptions that incorporate the Corporation's view that the current market conditions reflected only a short-term, distressed view of recent and near-term results rather than future long-term earning capacity.

The carrying amount of goodwill for the years ended December 31, 2009, 2008 and 2007 are shown in the following table. Amounts in all periods are based on business segments in effect at December 31, 2009.

	Business Bank		Retail Bank		Wealth & Insitutional Management		Total

	(in millions)
Balances at December 31, 2009, 2008 and 2007	$	90	$	47	$	13	$	150

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Note 10 — Derivative and Credit-Related Financial Instruments

In the normal course of business, the Corporation enters into various transactions involving derivative and credit-related financial instruments to manage exposure to fluctuations in interest rate, foreign currency and other market risks and to meet the financing needs of customers. These financial instruments involve, to varying degrees, elements of credit and market risk.

Credit risk is the possible loss that may occur in the event of nonperformance by the counterparty to a financial instrument. The Corporation attempts to minimize credit risk arising from financial instruments by evaluating the creditworthiness of each counterparty, adhering to the same credit approval process used for traditional lending activities. Counterparty risk limits and monitoring procedures also facilitate the management of credit risk. Collateral is obtained, if deemed necessary, based on the results of management's credit evaluation. Collateral varies, but may include cash, investment securities, accounts receivable, equipment or real estate.

Market risk is the potential loss that may result from movements in interest rates, foreign currency exchange rates or energy commodity prices that cause an unfavorable change in the value of a financial instrument. Market risk arising from derivative instruments is reflected in the consolidated financial statements. The Corporation manages this risk by establishing monetary exposure limits and monitoring compliance with those limits. Market risk inherent in derivative instruments entered into on behalf of customers is mitigated by taking offsetting positions, except in those circumstances when the amount, tenor and/or contract rate level results in negligible economic risk. Market risk inherent in derivative instruments held or issued for risk management purposes is typically offset by changes in the fair value of the assets or liabilities being hedged.

Derivative Instruments

Derivative instruments are traded over an organized exchange or negotiated over-the-counter. Credit risk associated with exchange-traded contracts is typically assumed by the organized exchange. Over-the-counter contracts are tailored to meet the needs of the counterparties involved and, therefore, contain a greater degree of credit risk and liquidity risk than exchange-traded contracts, which have standardized terms and readily available price information. The Corporation reduces exposure to credit and liquidity risks from over-the-counter derivative instruments entered into for risk management purposes, and transactions entered into to mitigate the market risk associated with customer-initiated transactions, by conducting such transactions with investment grade domestic and foreign financial institutions and subjecting counterparties to credit approvals, limits and monitoring procedures similar to those used in making other extensions of credit.

Detailed discussions of each class of derivative instruments held or issued by the Corporation for both risk management and customer-initiated and other activities are as follows.

Interest Rate Swaps

Interest rate swaps are agreements in which two parties periodically exchange fixed cash payments for variable payments based on a designated market rate or index, or variable payments based on two different rates or indices, applied to a specified notional amount until a stated maturity. The Corporation's swap agreements are structured such that variable payments are primarily based on prime, one-month LIBOR or three-month LIBOR. These instruments are principally negotiated over-the-counter and are subject to credit risk, market risk and liquidity risk.

Foreign Exchange Contracts

Foreign exchange contracts such as futures, forwards and options are primarily entered into as a service to customers and to offset market risk arising from such positions. Futures and forward contracts require the

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delivery or receipt of foreign currency at a specified date and exchange rate. Foreign currency options allow the owner to purchase or sell a foreign currency at a specified date and price. Foreign exchange futures are exchange-traded, while forwards, swaps and most options are negotiated over-the-counter. Foreign exchange contracts expose the Corporation to both market risk and credit risk. The Corporation also uses foreign exchange rate swaps and cross-currency swaps for risk management purposes.

Interest Rate Options, Including Caps and Floors

Option contracts grant the option holder the right to buy or sell an underlying financial instrument for a predetermined price before the contract expires. Interest rate caps and floors are option-based contracts which entitle the buyer to receive cash payments based on the difference between a designated reference rate and the strike price, applied to a notional amount. Written options, primarily caps, expose the Corporation to market risk but not credit risk. A fee is received at inception for assuming the risk of unfavorable changes in interest rates. Purchased options contain both credit and market risk. All interest rate caps and floors entered into by the Corporation are over-the-counter agreements.

Energy Derivative Contracts

The Corporation offers energy derivative contracts, including over-the-counter and NYMEX-based natural gas and crude oil fixed-rate swaps and options, as a service to customers seeking to hedge market risk in the underlying products. Contract tenors are typically limited to three years to accommodate hedge requirements and are further limited to products that are liquid and available on demand. Energy derivative swaps are over-the-counter agreements in which the Corporation and the counterparty periodically exchange fixed cash payments for variable payments based upon a designated market price or index. Energy derivative contracts expose the Corporation to both credit and market risk. Energy derivative option contracts grant the option owner the right to buy or sell the underlying commodity for a predetermined price at settlement date. Energy caps, floors and collars are option-based contracts that result in the buyer and seller of the contract receiving or making cash payments based on the difference between a designated reference price and the contracted strike price, applied to a notional amount. An option fee or premium is received by the Corporation at inception for assuming the risk of unfavorable changes in energy commodity prices. Purchased options contain both credit and market risk. Commodity options entered into by the Corporation are over-the-counter agreements.

Commitments

The Corporation also enters into commitments to purchase or sell earning assets for risk management and trading purposes. These transactions are similar in nature to forward contracts.

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The following table presents the composition of the Corporation's derivative instruments, excluding commitments, held or issued for risk management purposes or in connection with customer-initiated and other activities at December 31, 2009 and 2008.

				December 31, 2009						December 31, 2008

						Fair Value (a)						Fair Value (a)
				Notional/ Contract Amount (b)		Asset Derivatives (Unrealized Gains) (c)		Liability Derivatives (Unrealized Losses)		Notional/ Contract Amount (b)		Asset Derivatives (Unrealized Gains) (c)		Liability Derivatives (Unrealized Losses)
				(in millions)
Risk management purposes
	Derivatives designated as hedging instruments
		Interest rate contracts:
			Swaps — cash flow — receive fixed/pay floating	$	1,700	$	30	$	—	$	1,700	$	50	$	—
			Swaps — fair value — receive fixed/pay floating		1,600		194		—		1,700		346		—

	Total risk management interest rate swaps designated as hedging instruments				3,300		224		—		3,400		396		—

	Derivatives used as economic hedges
		Foreign exchange contracts:
			Spot and forwards		252		—		1		531		5		9
			Swaps		1		—		—		13		3		—

	Total risk management foreign exchange contracts used as economic hedges				253		—		1		544		8		9

Total risk management purposes				$	3,553	$	224	$	1	$	3,944	$	404	$	9

Customer-initiated and other activities
	Interest rate contracts:
		Caps and floors written		$	1,176	$	—	$	10	$	1,271	$	—	$	14
		Caps and floors purchased			1,176		10		—		1,271		14		—
		Swaps			9,744		262		230		9,800		410		376

	Total interest rate contracts				12,096		272		240		12,342		424		390

	Energy derivative contracts:
		Caps and floors written			869		—		70		634		—		84
		Caps and floors purchased			869		70		—		634		84		—
		Swaps			599		67		66		877		101		101

	Total energy derivative contracts				2,337		137		136		2,145		185		185

	Foreign exchange contracts:
		Spot, forwards, futures and options			2,000		34		32		2,695		101		86
		Swaps			23		1		1		28		1		1

	Total foreign exchange contracts				2,023		35		33		2,723		102		87

Total customer-initiated and other activities				$	16,456	$	444	$	409	$	17,210	$	711	$	662

Total derivatives				$	20,009	$	668	$	410	$	21,154	$	1,115	$	671

(a): Asset derivatives are included in "accrued income and other assets" and liability derivatives are included in "accrued expenses and other liabilities" in the consolidated balance sheets.
(b): Notional or contract amounts, which represent the extent of involvement in the derivatives market, are used to determine the contractual cash flows required in accordance with the terms of the agreement. These amounts are typically not exchanged, significantly exceed amounts subject to credit or market risk and are not reflected in the consolidated balance sheets.
(c): Unrealized gains represent receivables from derivative counterparties, and therefore expose the Corporation to credit risk. Credit risk, which excludes the effects of any collateral or netting arrangements, is measured as the cost to replace contracts in a profitable position at current market rates.

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By purchasing and writing derivative contracts, the Corporation is exposed to credit risk if the counterparties fail to perform. The Corporation minimizes credit risk through credit approvals, limits, monitoring procedures and collateral requirements. Nonperformance risk, including credit risk, is included in the determination of net fair value. Customer-initiated derivative instruments with a fair value of $444 million at December 31, 2009 were net of credit-related adjustments totaling $4 million.

Bilateral collateral agreements with counterparties reduce credit risk by providing for the daily exchange of cash or highly rated securities issued by the U.S. Treasury or other U.S. government agencies to collateralize amounts due to either party. At December 31, 2009, counterparties had pledged marketable investment securities to secure approximately 75 percent of the fair value of contracts with bilateral collateral agreements in an unrealized gain position. In addition, at December 31, 2009, master netting arrangements were in place with substantially all interest rate and energy swap counterparties and certain foreign exchange counterparties. These arrangements effectively reduce credit risk by permitting settlement, on a net basis, of contracts entered into with the same counterparty.

The aggregate fair value of all derivative instruments with credit-risk-related contingent features that were in a liability position on December 31, 2009 was $144 million, for which the Corporation had assigned collateral of $128 million in the normal course of business. The credit-risk-related contingent features require the Corporation's debt to maintain an investment grade credit rating from each of the major credit rating agencies. If the Corporation's debt were to fall below investment grade, the counterparties to the derivative instruments could require additional overnight collateral on derivative instruments in net liability positions. If the credit-risk-related contingent features underlying these agreements had been triggered on December 31, 2009, the Corporation would have been required to assign an additional $25 million of collateral to its counterparties.

The Corporation had commitments to purchase $19 million of investment securities for its trading account portfolio at December 31, 2009 and $1.3 billion of investment securities for its available-for-sale and trading account portfolios at December 31, 2008. Commitments to sell investment securities related to the trading account portfolio totaled $19 million and $10 million at December 31, 2009 and 2008, respectively. Outstanding commitments expose the Corporation to both credit and market risk.

Risk Management

As an end-user, the Corporation employs a variety of financial instruments for risk management purposes. Activity related to these instruments is centered predominantly in the interest rate markets and mainly involves interest rate swaps. Various other types of instruments also may be used to manage exposures to market risks, including interest rate caps and floors, total return swaps, foreign exchange forward contracts and foreign exchange swap agreements.

As part of a fair value hedging strategy, the Corporation entered into interest rate swap agreements for interest rate risk management purposes. These interest rate swap agreements effectively modify the Corporation's exposure to interest rate risk by converting fixed-rate debt and deposits to a floating rate. These agreements involve the receipt of fixed-rate interest amounts in exchange for floating-rate interest payments over the life of the agreement, without an exchange of the underlying principal amount.

Risk management fair value interest rate swaps generated net interest income of $61 million and $43 million for the years ended December 31, 2009 and 2008, respectively.

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The net gains (losses) recognized in other noninterest income (i.e., the ineffective portion) in the consolidated statements of income on risk management derivatives designated as fair value hedges of fixed-rate debt and deposits were as follows.

	Years Ended December 31

	2009			2008
	(in millions)
Interest rate swaps	$	(4	)	$	9

As part of a cash flow hedging strategy, the Corporation entered into predominantly two-year interest rate swap agreements (weighted-average original maturity of 2.2 years) that effectively convert a portion of existing and forecasted floating-rate loans to a fixed-rate basis, thus reducing the impact of interest rate changes on future interest income over the life of the agreements (currently over the next 15 months). Approximately four percent ($1.7 billion) of the Corporation's outstanding loans were designated as hedged items to interest rate swap agreements at December 31, 2009. If interest rates, interest yield curves and notional amounts remain at current levels, the Corporation expects to reclassify $16 million of net gains, net of tax, on derivative instruments designated as cash flow hedges from accumulated other comprehensive income (loss) to earnings during the next twelve months due to receipt of variable interest associated with existing and forecasted floating-rate loans.

The net gains (losses) recognized in income and OCI on risk management derivatives designated as cash flow hedges of loans for the years ended December 31, 2009 and 2008 are displayed in the table below.

		Years Ended December 31

		2009			2008
		(in millions)
Interest rate swaps
	Gain recognized in OCI (effective portion)	$	15		$	69
	Gain (loss) recognized in other noninterest income (ineffective portion)		(2	)		—
	Gain reclassified from accumulated OCI into interest and fees on loans (effective portion)		34			24

Foreign exchange rate risk arises from changes in the value of certain assets and liabilities denominated in foreign currencies. The Corporation employs spot and forward contracts in addition to swap contracts to manage exposure to these and other risks.

The net gains (losses) recognized in other noninterest income in the consolidated statements of income on risk management derivative instruments used as economic hedges were as follows.

	Years Ended December 31

	2009			2008
	(in millions)
Foreign exchange contracts	$	(1	)	$	—

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The following table summarizes the expected weighted average remaining maturity of the notional amount of risk management interest rate swaps and the weighted average interest rates associated with amounts expected to be received or paid on interest rate swap agreements as of December 31, 2009 and 2008.

					Weighted Average

			Notional Amount		Remaining Maturity (in years)		Receive Rate			Pay Rate (a)
			(dollar amounts in millions)
December 31, 2009
Swaps — cash flow — receive fixed/pay floating rate:
	Variable rate loan designation		$	1,700		0.9		5.22	%		3.25	%
Swaps — fair value — receive fixed/pay floating rate:
	Medium- and long-term debt designation			1,600		8.1		5.73			1.01

		Total risk management interest rate swaps	$	3,300

December 31, 2008
Swaps — cash flow — receive fixed/pay floating rate:
	Variable rate loan designation		$	1,700		1.9		5.22	%		3.56	%
Swaps — fair value — receive fixed/pay floating rate:
	Medium- and long-term debt designation			1,700		8.6		5.75			3.34

		Total risk management interest rate swaps	$	3,400

(a): Variable rates paid on receive fixed swaps are based on prime and LIBOR (with various maturities) rates in effect at December 31, 2009.

Management believes these hedging strategies achieve the desired relationship between the rate maturities of assets and funding sources which, in turn, reduce the overall exposure of net interest income to interest rate risk, although there can be no assurance that such strategies will be successful. The Corporation employs cash instruments, such as investment securities, as well as various types of derivative instruments to manage exposure to interest rate risk and other risks. Such instruments may include interest rate caps and floors, foreign exchange forward contracts, investment securities, foreign exchange option contracts and foreign exchange cross-currency swaps.

Customer-Initiated and Other Activities

Fee income is earned from entering into various transactions at the request of customers (customer-initiated contracts), principally foreign exchange contracts, interest rate contracts and energy derivative contracts. The Corporation mitigates market risk inherent in customer-initiated interest rate and energy contracts by taking offsetting positions, except in those circumstances when the amount, tenor and/or contracted rate level results in negligible economic risk, whereby the cost of purchasing an offsetting contract is not economically justifiable. For customer-initiated foreign exchange contracts, the Corporation mitigates most of the inherent market risk by taking offsetting positions and manages the remainder through individual foreign currency position limits and aggregate value-at-risk limits. These limits are established annually and reviewed quarterly.

For those customer-initiated derivative contracts which were not offset or where the Corporation holds a speculative position within the limits described above, the Corporation recognized, in "other noninterest income" in the consolidated statements of income, net gains of $1 million, $2 million and $1 million for the years ended December 31, 2009, 2008 and 2007, respectively.

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Fair values of customer-initiated and other derivative instruments represent the net unrealized gains or losses on such contracts and are recorded in the consolidated balance sheets. Changes in fair value are recognized in the consolidated statements of income. The net gains recognized in income on customer-initiated and other derivative instruments were as follows.

		Years Ended December 31

	Location of Gain	2009		2008
		(in millions)
Interest rate contracts	Other noninterest income	$	8	$	15
Energy derivative contracts	Other noninterest income		1		1
Foreign exchange contracts	Foreign exchange income		34		40

Total		$	43	$	56

Credit-Related Financial Instruments

The Corporation issues off-balance sheet financial instruments in connection with commercial and consumer lending activities. The Corporation's credit risk associated with these instruments is represented by the contractual amounts indicated in the following table.

		December 31

		2009		2008
		(in millions)
Unused commitments to extend credit:
	Commercial and other	$	22,451	$	25,901
	Bankcard, revolving check credit and home equity loan commitments		1,917		2,124

	Total unused commitments to extend credit	$	24,368	$	28,025

Standby letters of credit		$	5,652	$	6,204
Commercial letters of credit			104		156
Other financial guarantees			18		36

The Corporation maintains an allowance to cover probable credit losses inherent in lending-related commitments, including unused commitments to extend credit, letters of credit and financial guarantees. At December 31, 2009 and 2008, the allowance for credit losses on lending-related commitments, included in "accrued expenses and other liabilities" on the consolidated balance sheets, was $37 million and $38 million, respectively.

Unused Commitments to Extend Credit

Commitments to extend credit are legally binding agreements to lend to a customer, provided there is no violation of any condition established in the contract. These commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. Since many commitments expire without being drawn upon, the total contractual amount of commitments does not necessarily represent future cash requirements of the Corporation. Commercial and other unused commitments are primarily variable rate commitments.

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Standby and Commercial Letters of Credit and Financial Guarantees

Standby and commercial letters of credit represent conditional obligations of the Corporation which guarantee the performance of a customer to a third party. Standby letters of credit are primarily issued to support public and private borrowing arrangements, including commercial paper, bond financing and similar transactions. Commercial letters of credit are issued to finance foreign or domestic trade transactions and are short-term in nature. These contracts expire in decreasing amounts through the year 2019. The Corporation may enter into participation arrangements with third parties, which effectively reduce the maximum amount of future payments which may be required under standby and commercial letters of credit. These risk participations covered $404 million of the $5.8 billion standby and commercial letters of credit outstanding at December 31, 2009.

Financial guarantees at December 31, 2009 consisted of credit risk participation agreements, where the Corporation, primarily as part of a syndicated lending arrangement, guaranteed a portion of the credit risk on an interest rate swap agreement between the lead bank in the syndicate and a customer. In the event of default by a customer, the Corporation would be required to pay the portion of the unpaid amount guaranteed by the Corporation to the lead bank. At December 31, 2009, the estimated fair value of the Corporation's credit risk participation agreements where the Corporation was the guarantor was $18 million, and the estimated credit exposure was $27 million. The estimated credit exposure includes the estimated credit risk as of December 31, 2009, in addition to an estimate for potential future risk for changes in interest rates in each remaining year of the contract until maturity. In addition, the estimated credit exposure assumes the lead bank would be unable to liquidate assets of the customers. In the event of default, the lead bank has the ability to liquidate the assets of the customer, in which case the lead bank would be required to return a percentage of recouped assets to the participating banks. These credit risk participation agreements expire in decreasing amounts through the year 2016, with a weighted average remaining maturity for outstanding agreements of 1.6 years.

At December 31, 2009, the carrying value of the Corporation's standby and commercial letters of credit and financial guarantees, included in "accrued expenses and other liabilities" on the consolidated balance sheet, totaled $70 million.

The following table presents a summary of total internally classified watch list standby and commercial letters of credit and financial guarantees (generally consistent with regulatory defined special mention, substandard and doubtful) at December 31, 2009 and 2008. The Corporation manages credit risk through underwriting, periodically reviewing and approving its credit exposures using Board committee approved credit policies and guidelines.

	December 31

	2009			2008
	(dollar amounts in millions)
Total watch list standby and commercial letters of credit	$	432		$	277
As a percentage of total outstanding standby and commercial letters of credit		7.5	%		4.3	%
Total watch list financial guarantees	$	1		$	—
As a percentage of total outstanding financial guarantees		5.8	%		—	%

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Note 11 — Variable Interest Entities (VIEs)

The Corporation evaluates its interest in certain entities to determine if these entities meet the definition of a VIE and whether the Corporation was the primary beneficiary and should consolidate the entity based on the variable interests it held. The following provides a summary of the VIEs in which the Corporation has a significant interest.

The Corporation owns 100 percent of the common stock of an entity formed in 2007 to issue trust preferred securities. This entity meets the definition of a VIE, but the Corporation is not the primary beneficiary as the expected losses and residual returns of the trust are absorbed by the trust preferred stock holders. The trust preferred securities held by this entity ($500 million at December 31, 2009) qualify as Tier 1 capital and are classified as subordinated debt included in "medium- and long-term debt" on the consolidated balance sheets, with associated interest expense recorded in "interest on medium- and long-term debt" on the consolidated statements of income. The Corporation is not exposed to loss related to this VIE.

The Corporation has limited partnership interests in three private equity investment partnerships, which were acquired in 1998, 1999 and 2001, where the general partner (an employee of the Corporation) in these three partnerships is considered a related party to the Corporation. These entities meet the definition of a VIE; however, the Corporation is not the primary beneficiary of the entities, as the majority of variable interests are expected to accrue to the nonaffiliated limited partners. As such, the Corporation accounts for its interest in these partnerships on the cost method. Investments are included in "accrued income and other assets" on the consolidated balance sheets, with income (net of write-downs) recorded in "other noninterest income" on the consolidated statements of income. These entities had approximately $108 million in assets at December 31, 2009. These funds generally cannot be redeemed. Distributions from these funds are received by the Corporation as the result of liquidation of underlying investments of the funds and/or as income distributions. Exposure to loss as a result of involvement with these entities at December 31, 2009 was limited to the book basis of the Corporation's investments of approximately $4 million and approximately $1 million of commitments for future investments.

The Corporation, as a limited partner, also holds an insignificant ownership percentage interest in 130 other private equity and venture capital investment partnerships where the Corporation is not related to the general partner. While these entities may meet the definition of a VIE, the Corporation is not the primary beneficiary of any of these entities as a result of its insignificant ownership interest. The Corporation accounts for its interests in these partnerships on the cost method. Investments are included in "accrued income and other assets" on the consolidated balance sheets with income (net of write-downs) recorded in "other noninterest income" on the consolidated statements of income. These funds generally cannot be redeemed. Distributions from these funds are received by the Corporation as the result of liquidation of underlying investments of the funds and/or as income distributions. Exposure to loss as a result of involvement with these entities at December 31, 2009 was limited to the book basis of the Corporation's investments of approximately $53 million and approximately $25 million of commitments for future investments.

A limited liability subsidiary of the Corporation is the general partner in an investment fund partnership formed in 2003. The subsidiary manages the investments held by the fund and the investment partnership meets the definition of a VIE. The Corporation is the primary beneficiary and consolidates the entity, as the majority of the variable interests are expected to accrue to the Corporation. The investment partnership had assets of approximately $2 million at December 31, 2009 and was structured so that the Corporation's exposure to loss as a result of its interest would be limited to the book basis of the Corporation's investment in the limited liability subsidiary, which was insignificant at December 31, 2009. Total fee revenue earned by the Corporation as

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general partner for the fund was insignificant (less than $0.1 million) for each of the years ended December 31, 2009, 2008 and 2007.

The Corporation has a significant limited partnership interest in 20 low income housing tax credit/historic rehabilitation tax credit partnerships, acquired at various times from 1992 through 2008. These entities meet the definition of a VIE; however, the Corporation is not the primary beneficiary of the entities as the majority of the variable interests are expected to accrue to the general partner, who is also the party engaging in activities that are most closely associated with the entities. The Corporation accounts for its interest in these partnerships on the cost or equity method. These entities had approximately $142 million in assets at December 31, 2009. Exposure to loss as a result of the Corporation's involvement with these entities at December 31, 2009 was limited to the book basis of the Corporation's investment of approximately $8 million, which includes unused commitments for future investments.

The Corporation, as a limited partner, also holds an insignificant ownership percentage interest in 119 other low income housing tax credit/historic rehabilitation tax credit partnerships. While these entities may meet the definition of a VIE, the Corporation is not the primary beneficiary of any of these entities as a result of its insignificant ownership interest. As such, the Corporation accounts for its interest in these partnerships on the cost or equity method. Exposure to loss as a result of its involvement with these entities at December 31, 2009 was limited to the book basis of the Corporation's investment of approximately $328 million, which includes unused commitments for future investments.

As a limited partner, the Corporation obtains income tax credits and deductions from the operating losses of these low income housing tax credit/historic rehabilitation tax credit partnerships, which are recorded as a reduction of income tax expense (or an increase to income tax benefit) and a reduction of federal income taxes payable. These income tax credits and deductions are allocated to the funds' investors based on their ownership percentages. Investment balances, including all legally binding commitments to fund future investments, are included in "accrued income and other assets" on the consolidated balance sheets, with amortization and other write-downs of investments recorded in "other noninterest income" on the consolidated statements of income. In addition, a liability is recognized in "accrued expenses and other liabilities" on the consolidated balance sheets for all legally binding unfunded commitments to fund low income housing partnerships ($63 million at December 31, 2009).

The Corporation provided no financial or other support that was not contractually required to any of the above VIEs during the year ended December 31, 2009.

The following table summarizes the impact of these VIEs on line items on the Corporation's consolidated statements of income.

	Years Ended December 31

	2009			2008
	(in millions)
Classfication in Earnings
Interest on medium- and long-term debt	$	34		$	34
Other noninterest income		(60	)		(53	)
Provision (benefit) for income taxes (a)		(46	)		(45	)

(a): Income tax credits from low income housing tax credit/historic rehabilitation tax credit partnerships.

For further information on the Corporation's consolidation policy, see Note 1.

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Note 12 — Deposits

At December 31, 2009, the scheduled maturities of certificates of deposit and other deposits with a stated maturity were as follows:

		Years Ending December 31

		(in millions)
2010		$	7,146
2011			633
2012			88
2013			51
2014			43
Thereafter			41

	Total	$	8,002

A maturity distribution of domestic certificates of deposit of $100,000 and over follows:

		December 31

		2009		2008
		(in millions)
Three months or less		$	1,657	$	3,834
Over three months to six months			1,142		2,152
Over six months to twelve months			1,333		5,211
Over twelve months			536		1,234

	Total	$	4,668	$	12,431

All foreign office time deposits of $542 million and $470 million at December 31, 2009 and 2008, respectively, were in denominations of $100,000 or more.

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Note 13 — Short-Term Borrowings

Federal funds purchased and securities sold under agreements to repurchase generally mature within one to four days from the transaction date. Other short-term borrowings, which may consist of Federal Reserve Term Auction Facility borrowings, commercial paper, borrowed securities, term federal funds purchased, short-term notes and treasury tax and loan deposits, generally mature within one to 120 days from the transaction date. The following table provides a summary of short-term borrowings.

		Federal Funds Purchased and Securities Sold Under Agreements to Repurchase			Other Short-term Borrowings

		(dollar amounts in millions)
December 31, 2009
	Amount outstanding at year-end	$	462		$	—
	Weighted average interest rate at year-end		0.03	%		—	%
	Maximum month-end balance during the year	$	655		$	2,558
	Average balance outstanding during the year		467			532
	Weighted average interest rate during the year		0.19	%		0.28	%
December 31, 2008
	Amount outstanding at year-end	$	696		$	1,053
	Weighted average interest rate at year-end		0.37	%		0.40	%
	Maximum month-end balance during the year	$	3,617		$	3,046
	Average balance outstanding during the year		2,105			1,658
	Weighted average interest rate during the year		2.20	%		2.43	%
December 31, 2007
	Amount outstanding at year-end	$	1,749		$	1,058
	Weighted average interest rate at year-end		1.84	%		3.87	%
	Maximum month-end balance during the year	$	1,985		$	1,191
	Average balance outstanding during the year		1,854			226
	Weighted average interest rate during the year		5.04	%		5.21	%

At December 31, 2009, Comerica Bank (the Bank), a subsidiary of the Corporation, had pledged loans totaling $11 billion which provided for up to $7 billion of collateralized borrowing with the FRB.

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Note 14 — Medium- and Long-Term Debt

Medium- and long-term debt are summarized as follows:

		December 31

		2009		2008
		(in millions)
Parent company
Subordinated notes:
	4.80% subordinated note due 2015	$	325	$	342
	6.576% subordinated notes due 2037		511		510

Total subordinated notes			836		852
Medium-term note:
	Floating rate based on LIBOR indices due 2010		150		150

Total parent company			986		1,002
Subsidiaries
Subordinated notes:
	8.50% subordinated note due 2009		—		101
	7.125% subordinated note due 2010		152		149
	5.70% subordinated note due 2014		275		286
	5.75% subordinated notes due 2016		678		701
	5.20% subordinated notes due 2017		543		592
	8.375% subordinated note due 2024		187		207
	7.875% subordinated note due 2026		204		246

Total subordinated notes			2,039		2,282
Medium-term notes:
	Floating rate based on LIBOR indices due 2009 to 2012		1,982		3,669
	Floating rate based on Federal Funds indices due 2009		—		100
Federal Home Loan Bank advances:
	Floating rate based on LIBOR indices due 2009 to 2014		6,000		8,000
Other notes:
	6.0% — 6.4% fixed rate notes due 2020		53		—

Total subsidiaries			10,074		14,051

Total medium- and long-term debt		$	11,060	$	15,053

The carrying value of medium- and long-term debt has been adjusted to reflect the gain or loss attributable to the risk hedged. Concurrent with or subsequent to the issuance of certain of the medium- and long-term debt

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presented above, the Corporation entered into interest rate swap agreements to convert the stated rate of the debt to a rate based on the indices identified in the following table.

		Principal Amount of Debt Converted

		(dollar amounts in millions)
Parent company
	4.80% subordinated note due 2015	$	300	6-month LIBOR	4.34	%
Subsidiaries
	5.70% subordinated note due 2014		250	6-month LIBOR	4.34
	5.75% subordinated notes due 2016		250	6-month LIBOR	4.34
	5.20% subordinated notes due 2017		500	6-month LIBOR	4.34
	8.375% subordinated note due 2024		150	6-month LIBOR	4.34
	7.875% subordinated note due 2026		150	6-month LIBOR	4.34

The Bank is a member of the FHLB, which provides short- and long-term funding collateralized by mortgage-related assets to its members. FHLB advances bear interest at variable rates based on LIBOR and were secured by $2.8 billion of real estate-related loans and $3.2 billion of mortgage-backed investment securities at December 31, 2009. The FHLB advances outstanding at December 31, 2009 are due from 2010 to 2014. The advances do not qualify as Tier 2 capital and are not insured by the Federal Deposit Insurance Corporation (FDIC).

In 2009, the Bank repurchased, at a discount, $212 million of floating-rate medium-term notes maturing in 2012 and recognized a gain of $15 million. In January 2010, the Bank exercised its option to redeem a $150 million, 7.125% subordinated note, which had an original maturity date of 2013.

The Corporation has $500 million of 6.576% subordinated notes maturing in 2037 that relate to trust preferred securities issued by an unconsolidated subsidiary. The 6.576% subordinated notes qualify as Tier 1 capital. All other subordinated notes with maturities greater than one year qualify as Tier 2 capital.

The Corporation currently has a $15 billion medium-term senior note program. This program allows the principal banking subsidiary to issue fixed- or floating-rate notes with maturities between one year and 30 years. The Bank did not issue any notes under the senior note program during the years ended December 31, 2009 and 2008. The interest rate on the floating rate medium-term notes based on LIBOR at December 31, 2009, ranged from one-month LIBOR plus 0.10% to three-month LIBOR plus 0.15%. The medium-term notes outstanding at December 31, 2009 are due from 2010 to 2012. The medium-term notes do not qualify as Tier 2 capital and are not insured by the FDIC.

The Bank participated in the voluntary Temporary Liquidity Guarantee Program (the TLG Program) announced by the Federal Deposit Insurance Corporation (FDIC) in October 2008 and amended in March 2009. Under the TLG Program, all senior unsecured debt issued between October 14, 2008 and October 31, 2009, with a maturity of more than 30 days, is guaranteed by the FDIC. Debt guaranteed by the FDIC is backed by the full faith and credit of the United States. The FDIC guarantee expires on the earlier of the maturity date of the debt or December 31, 2012 (June 30, 2012 for debt issued prior to April 1, 2009). At December 31, 2009, there was approximately $7 million of senior unsecured debt outstanding in the form of bank-to-bank deposits issued under the TLG Program.

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At December 31, 2009, the principal maturities of medium- and long-term debt were as follows:

		Years Ending December 31

		(in millions)
2010		$	2,750
2011			1,375
2012			1,158
2013			2,000
2014			1,250
Thereafter			2,318

	Total	$	10,851

Note 15 — Shareholders' Equity

In November 2007, the Board of Directors of the Corporation (the Board) authorized the purchase of up to 10 million shares of Comerica Incorporated outstanding common stock, in addition to the remaining unfilled portion of the November 2006 authorization. There is no expiration date for the Corporation's share repurchase program. Substantially all shares purchased as part of the Corporation's publicly announced repurchase program were transacted in the open market and were within the scope of Rule 10b-18, which provides a safe harbor for purchases in a given day if an issuer of equity securities satisfies the manner, timing, price and volume conditions of the rule when purchasing its own common shares in the open market. There were no open market repurchases in 2009 and 2008. Open market repurchases totaled 10.0 million shares for the year ended December 31, 2007. The following table summarizes the Corporation's share repurchase activity for the year ended December 31, 2009.

		Total Number of Shares Purchased as Part of Publicly Announced Repurchase Plans or Programs				Average Price Paid Per Share

		(shares in thousands)
Total first quarter 2009			—	12,576	65	$	15.11

Total second quarter 2009			—	12,576	32		20.56

Total third quarter 2009			—	12,576	3		23.88

October 2009			—	12,576	1		28.55
November 2009			—	12,576	—		—
December 2009			—	12,576	—		—

Total fourth quarter 2009			—	12,576	1		28.25

	Total 2009		—	12,576	101	$	17.25

(a): Maximum number of shares that may yet be purchased under the publicly announced plans or programs.
(b): Includes shares purchased as part of publicly announced repurchase plans or programs, shares purchased pursuant to deferred compensation plans and shares purchased from employees to pay for grant prices and/or taxes related to stock option exercises and restricted stock vesting under the terms of an employee share-based compensation plan.

In 2008, the Corporation participated in the U.S. Department of Treasury (U.S. Treasury) Capital Purchase Program (the Capital Purchase Program) and received proceeds of $2.25 billion from the U.S. Treasury. In

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return, the Corporation issued 2.25 million shares of Fixed Rate Cumulative Perpetual Preferred Stock, Series F, without par value (Series F Preferred Shares) and granted a warrant to purchase 11.5 million shares of common stock at an exercise price of $29.40 per share to the U.S. Treasury. The Series F Preferred Shares pay a cumulative dividend rate of five percent per annum on the liquidation preference of $1,000 per share through November 2013, and a rate of nine percent per annum thereafter. The Series F Preferred Shares are non-voting, other than class voting rights on matters that could adversely affect the shares. The Series F Preferred Shares may be redeemed at $1,000 per share, plus accrued and unpaid dividends, subject to consultation with the Corporation's banking regulators, with the consent of the U.S. Treasury. The U.S. Treasury may transfer the Series F Preferred Shares to a third party at any time. The Series F Preferred Shares qualify as Tier 1 capital.

The warrant to purchase common stock was immediately exercisable and is not subject to contractual restrictions on transfer. The warrant qualifies as Tier 1 capital and expires in November 2018.

The proceeds from the Capital Purchase Program were allocated between the Series F Preferred Shares and the related warrant based on relative fair value, which resulted in an initial carrying value of $2.1 billion for the Series F Preferred Shares and $124 million for the warrant. The resulting discount to the Series F Preferred Shares of $124 million is accreting on a level yield basis over five years ending November 2013 and is being recognized as additional preferred stock dividends. The cash dividend combined with the accretion of the discount results in an effective preferred dividend rate of 6.3 percent. At December 31, 2009, accumulated preferred stock dividends not declared for the Series F Preferred Shares, excluding the discount accretion discussed above, totaled $14 million, or $6.39 per preferred share. The fair value assigned to the Series F Preferred Shares was estimated using a discounted cash flow model. The discount rate used in the model was based on yields on comparable publicly traded perpetual preferred stocks. The fair value assigned to the warrant was based on a binomial model using several inputs, including risk-free rate, expected stock price volatility and expected dividend yield. The risk-free interest rate assumption used in the binomial model was based on the ten-year U. S. Treasury interest rate. The expected dividend yield was based on the historical and projected dividend yield patterns of the Corporation's common shares. Expected volatility assumptions considered both the historical volatility of the Corporation's common stock over a ten-year period and implied volatility based on the most recent observed market transaction as of the valuation date.

Under the Capital Purchase Program, the consent of the U.S. Treasury is required for any increase in common dividends declared from the dividend rate in effect at the time of investment (quarterly dividend rate of $0.33 per share) and for any common share repurchases, other than common share repurchases in connection with any benefit plan in the ordinary course of business, until November 2011, unless the Series F Preferred Shares have been fully redeemed or the U.S. Treasury has transferred all the Series F Preferred Shares to third parties prior to that date. In addition, all accrued and unpaid dividends on the Series F Preferred Shares must be declared and the payment set aside for the benefit of the holders of the Series F Preferred Shares before any dividend may be declared on the Corporation's common stock and before any shares of the Corporation's common stock may be repurchased, other than share repurchases in connection with any benefit plan in the ordinary course of business.

As required by the Capital Purchase Program, the Corporation adopted the U.S. Treasury's standards for executive compensation and corporate governance for the period during which the U.S. Treasury holds equity issued under the Capital Purchase Program. These standards generally apply to the chief executive officer, the chief financial officer, and the three most highly compensated executive officers (the senior executive officers), plus the 20 most highly compensated employees. In addition, the Corporation was not allowed to deduct, for tax purposes, executive compensation in excess of $500,000 for each senior executive officer.

At December 31, 2009, the Corporation had 11.5 million shares of common stock reserved for the warrant issued under the Capital Purchase Program, 25.4 million shares of common stock reserved for stock option

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exercises and 2.1 million shares of restricted stock outstanding to employees and directors under share-based compensation plans.

Note 16 — Accumulated Other Comprehensive Income (Loss)

Other comprehensive income (loss) includes the change in net unrealized gains and losses on investment securities available-for-sale, the change in accumulated net gains and losses on cash flow hedges and the change in the accumulated defined benefit and other postretirement plans adjustment. Total comprehensive income (loss) was ($10) million, $81 million and $833 million for the years ended December 31, 2009, 2008 and 2007, respectively. The $91 million decrease in total comprehensive income for the year ended December 31, 2009, when compared to 2008, resulted principally from a decrease in net unrealized gains on investment securities available-for-sale ($260 million, after-tax) and a decrease in net income ($196 million), partially offset by a benefit from the defined benefit and other postretirement benefit plans adjustment ($405 million, after-tax). The following table presents reconciliations of the components of accumulated other comprehensive income (loss) for the years ended December 31, 2009, 2008 and 2007.

For a further discussion of the effects of investment securities available-for-sale, derivative instruments and defined benefit and other postretirement benefit plans on other comprehensive income (loss) refer to Notes 1, 10 and 19.

			Years Ended December 31

			2009			2008			2007
			(in millions)
Accumulated net unrealized gains (losses) on investment securities available-for-sale:
	Balance at beginning of period, net of tax		$	131		$	(9	)	$	(61	)
		Net unrealized holding gains arising during the period		54			285			87
		Less: Reclassification adjustment for net gains included in net income		243			67			7

		Change in net unrealized gains before income taxes		(189	)		218			80
		Less: Provision for income taxes		(69	)		78			28

		Change in net unrealized gains on investment securities available-for-sale, net of tax		(120	)		140			52

	Balance at end of period, net of tax		$	11		$	131		$	(9	)
Accumulated net gains (losses) on cash flow hedges:
	Balance at beginning of period, net of tax		$	30		$	2		$	(48	)
		Net cash flow hedge gains arising during the period		15			69			9
		Less: Reclassification adjustment for net gains (losses) included in net income		34			24			(67	)

		Change in net cash flow hedge gains before income taxes		(19	)		45			76
		Less: Provision for income taxes		(7	)		17			26

		Change in net cash flow hedge gains, net of tax		(12	)		28			50

	Balance at end of period, net of tax		$	18		$	30		$	2
Accumulated defined benefit pension and other postretirement plans adjustment:
	Balance at beginning of period, net of tax		$	(470	)	$	(170	)	$	(215	)
		Net defined benefit pension and other postretirement adjustment arising during the period		112			(488	)		41
		Less: Adjustment for amounts recognized as components of net periodic benefit cost during the period		(53	)		(18	)		(30	)

		Change in defined benefit and other postretirement plans adjustment before income taxes		165			(470	)		71
		Less: Provision for income taxes		60			(170	)		26

		Change in defined benefit and other postretirement plans adjustment, net of tax		105			(300	)		45

	Balance at end of period, net of tax		$	(365	)	$	(470	)	$	(170	)

Total accumulated other comprehensive loss at end of period, net of tax			$	(336	)	$	(309	)	$	(177	)

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Note 17 — Net Income (Loss) Per Common Share

Basic and diluted income (loss) from continuing operations per common share and net income (loss) per common share are presented in the following table.

			Years Ended December 31

			2009			2008		2007
			(in millions, except per share data)
Basic and diluted
	Income from continuing operations		$	16		$	212	$	682
	Less:
		Preferred stock dividends		134			17		—
		Income allocated to participating securities		1			4		6

	Income (loss) from continuing operations attributable to common shares		$	(119	)	$	191	$	676

	Net income		$	17		$	213	$	686
	Less:
		Preferred stock dividends		134			17		—
		Income allocated to participating securities		1			4		6

	Net income (loss) attributable to common shares		$	(118	)	$	192	$	680

Basic average common shares				149			149		153

Basic income (loss) from continuing operations per common share			$	(0.80	)	$	1.28	$	4.43
Basic net income (loss) per common share				(0.79	)		1.29		4.45
Basic average common shares				149			149		153
Common stock equivalents:
	Net effect of the assumed exercise of stock options			—			—		1
	Net effect of the assumed exercise of warrant			—			—		—

Diluted average common shares				149			149		154

Diluted income (loss) from continuing operations per common share			$	(0.80	)	$	1.28	$	4.40
Diluted net income (loss) per common share				(0.79	)		1.28		4.43

Basic income (loss) from continuing operations per common share and net income (loss) per common share are calculated using the two-class method. The two-class method is an earnings allocation formula that determines earnings per share for each share of common stock and participating securities according to dividends declared (distributed earnings) and participation rights in undistributed earnings. Distributed and undistributed earnings are allocated between common and participating security shareholders based on their respective rights to receive dividends. Unvested share-based payment awards that contain nonforfeitable rights to dividends or dividend equivalents are considered participating securities (i.e., nonvested restricted stock). Undistributed net losses are not allocated to nonvested restricted shareholders, as these shareholders do not have a contractual obligation to fund the losses incurred by the Corporation. Income (loss) from continuing operations attributable to common shares and net income (loss) attributable to common shares are then divided by the weighted-average number of common shares outstanding during the period.

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Diluted income (loss) from continuing operations per common share and net income (loss) per common share consider common stock issuable under the assumed exercise of stock options granted under the Corporation's stock plans and a warrant. Diluted income (loss) from continuing operations attributable to common shares and net income (loss) attributable to common shares are then divided by the total of weighted-average number of common shares and common stock equivalents outstanding during the period.

The following average shares related to outstanding options and a warrant to purchase shares of common stock were not included in the computation of diluted net income (loss) per common share because the options' and warrant's exercise prices were greater than the average market price of common shares for the period.

	2009	2008	2007

	(shares in millions)
Average shares related to outstanding options and warrant	29.1	19.7	10.3
Range of exercise prices	$28.07 – $66.81	$33.69 – $71.58	$56.00 – $71.58

Due to the net loss attributable to common shares reported for the year ended December 31, 2009, options to purchase 1.5 million shares, with average exercise prices less than the average market price of common shares for the period, were excluded from the computation of diluted net loss per share, as their inclusion would have been anti-dilutive.

Note 18 — Share-Based Compensation

Share-based compensation expense is charged to "salaries" expense on the consolidated statements of income. The components of share-based compensation expense for all share-based compensation plans and related tax benefits are as follows:

	2009		2008		2007

	(in millions)
Total share-based compensation expense	$	32	$	51	$	59

Related tax benefits recognized in net income	$	12	$	19	$	21

The following table summarizes unrecognized compensation expense for all share-based plans:

	December 31, 2009

	(dollar amount in millions)
Total unrecognized share-based compensation expense	$	35

Weighted-average expected recognition period (in years)		2.7

The Corporation has share-based compensation plans under which it awards both shares of restricted stock to key executive officers and key personnel and stock options to executive officers, directors and key personnel of the Corporation and its subsidiaries. Restricted stock vests over periods ranging from three years to five years. Stock options vest over periods ranging from one year to four years. During the period the U.S. Treasury holds equity issued under the Capital Purchase Program, restricted share grants may not vest in less than two years from the grant date and retirement-based acceleration is not allowed. These restrictions lengthen the requisite service period and, therefore, the amortization period for retirement eligible grantees. The maturity of each option is determined at the date of grant; however, no options may be exercised later than ten years and one month from the date of grant. The options may have restrictions regarding exercisability. The plans originally

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provided for a grant of up to 13.2 million common shares, plus shares under certain plans that are forfeited, expire or are cancelled. At December 31, 2009, 7.0 million shares were available for grant.

The Corporation used a binomial model to value stock options granted in the periods presented. Option valuation models require several inputs, including the expected stock price volatility, and changes in input assumptions can materially affect the fair value estimates. The model used may not necessarily provide a reliable single measure of the fair value of employee and director stock options. The risk-free interest rate assumption used in the binomial option-pricing model as outlined in the table below was based on the federal ten-year treasury interest rate. The expected dividend yield was based on the historical and projected dividend yield patterns of the Corporation's common shares. Expected volatility assumptions considered both the historical volatility of the Corporation's common stock over a ten-year period and implied volatility based on actively traded options on the Corporation's common stock with pricing terms and trade dates similar to the stock options granted.

The estimated weighted-average grant-date fair value per option share and the underlying binomial option-pricing model assumptions are summarized in the following table:

		2009			2008			2007

Weighted-average grant-date fair value per option share		$	6.55		$	9.54		$	12.47
Weighted-average assumptions:
	Risk-free interest rates		3.08	%		3.73	%		4.88	%
	Expected dividend yield		4.62			4.62			3.85
	Expected volatility factors of the market price of Comerica common stock		58			34			23
	Expected option life (in years)		6.4			6.6			6.4

A summary of the Corporation's stock option activity and related information for the year ended December 31, 2009 follows:

					Weighted-Average

		Number of Options (in thousands)			Exercise Price per Share		Remaining Contractual Term (in years)		Aggregate Intrinsic Value (in millions)
Outstanding — January 1, 2009			19,234		$	53.51
	Granted		1,535			17.36
	Forfeited or expired		(2,347	)		61.18
	Exercised		—			—

Outstanding — December 31, 2009			18,422			49.52		4.9	$	18

Outstanding, net of expected forfeitures — December 31, 2009			18,253			49.70		4.9		17
Exercisable — December 31, 2009			13,927			53.17		4.0		—

The aggregate intrinsic value of outstanding options shown in the table above represents the total pretax intrinsic value at December 31, 2009, based on the Corporation's closing stock price of $29.57 at December 31, 2009.

There were no stock options exercised during 2009. The total intrinsic value of stock options exercised was less than $0.5 million and $33 million for the years ended December 31, 2008 and 2007, respectively. Cash received from the exercise of stock options during 2008 and 2007 totaled $1 million and $89 million, respectively. The net excess income tax benefit realized for the tax deductions from the exercise of these options

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totaled less than $0.5 million for the year ended December 31, 2008 and $8 million for the year ended December 31, 2007.

A summary of the Corporation's restricted stock activity and related information for 2009 follows:

				Weighted-Average Grant-Date Fair Value per Share

Outstanding — January 1, 2009		1,627		$	50.17
	Granted	882			18.92
	Forfeited	(118	)		41.45
	Vested	(302	)		54.67

Outstanding — December 31, 2009		2,089		$	36.82

The total fair value of restricted stock awards that fully vested during the years ended December 31, 2009, 2008 and 2007 was $16 million, $7 million and $10 million, respectively.

The Corporation expects to satisfy the exercise of stock options and future grants of restricted stock by issuing shares of common stock out of treasury. At December 31, 2009, the Corporation held 27.6 million shares in treasury.

For further information on the Corporation's share-based compensation plans, refer to Note 1.

Note 19 — Employee Benefit Plans

Defined Benefit Pension and Postretirement Benefit Plans

The Corporation has a qualified and a non-qualified defined benefit pension plan, which together provide benefits for substantially all full-time employees hired before January 1, 2007. Employee benefits expense included defined benefit pension expense of $57 million, $20 million and $36 million in the years ended December 31, 2009, 2008 and 2007, respectively, for the plans. Benefits under the defined benefit plans are based primarily on years of service, age and compensation during the five highest paid consecutive calendar years occurring during the last ten years before retirement.

The Corporation's postretirement benefit plan continues to provide postretirement health care and life insurance benefits for retirees as of December 31, 1992. The plan also provides certain postretirement health care and life insurance benefits for a limited number of retirees who retired prior to January 1, 2000. For all other employees hired prior to January 1, 2000, a nominal benefit is provided. Employees hired on or after January 1, 2000 are not eligible to participate in the plan. The Corporation funds the pre-1992 retiree plan benefits with bank-owned life insurance.

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The following table sets forth reconciliations of the projected benefit obligation and plan assets of the Corporation's qualified defined benefit pension plan, non-qualified defined benefit pension plan and postretirement benefit plan. The Corporation used a measurement date of December 31, 2009 for these plans.

	Qualified Defined Benefit Pension Plan						Non-Qualified Defined Benefit Pension Plan						Postretirement Benefit Plan

	2009			2008			2009			2008			2009			2008
	(in millions)
Change in projected benefit obligation:
Projected benefit obligation at January 1	$	1,165		$	1,037		$	156		$	140		$	80		$	81
Service cost		28			28			4			4			—			—
Interest cost		69			66			9			8			5			5
Actuarial (gain) loss		(7	)		73			(11	)		8			5			4
Benefits paid		(42	)		(39	)		(6	)		(4	)		(6	)		(7	)
Plan change		—			—			4			—			—			(3	)

Projected benefit obligation at December 31	$	1,213		$	1,165		$	156		$	156		$	84		$	80

Change in plan assets:
Fair value of plan assets at January 1	$	1,080		$	1,237		$	—		$	—		$	74		$	85
Actual return on plan assets		200			(293	)		—			—			7			(10	)
Employer contributions		100			175			—			—			(1	)		6
Benefits paid		(42	)		(39	)		—			—			(7	)		(7	)

Fair value of plan assets at December 31	$	1,338		$	1,080		$	—		$	—		$	73		$	74

Accumulated benefit obligation	$	1,096		$	1,031		$	142		$	131		$	84		$	80

Funded status at December 31 (a)	$	125		$	(85	)	$	(156	)	$	(156	)	$	(11	)	$	(6	)

(a): Based on projected benefit obligation for pension plans and accumulated benefit obligation for postretirement benefit plan.

The 2009 non-qualified defined benefit pension plan change of $4 million reflected the recognition of special agreement benefits not previously included in plan valuations. The accumulated benefit obligation exceeded the fair value of plan assets for the non-qualified defined benefit pension plan and the postretirement benefit plan at December 31, 2009 and 2008.

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The following table details the amounts recognized in accumulated other comprehensive income (loss) at December 31, 2009, 2008 and 2007, and changes for the years then ended, for the qualified defined benefit pension plan, non-qualified defined benefit pension plan and postretirement benefit plan.

		Qualified Defined Benefit Pension Plan											Non-Qualified Defined Benefit Pension Plan

		Net Loss			Prior Service (Cost) Credit			Net Transition Obligation		Total			Net Loss			Prior Service (Cost) Credit			Net Transition Obligation		Total
		(in millions)
Balance at December 31, 2006, net of tax		$	(138	)	$	(24	)	$	—	$	(162	)	$	(31	)	$	8		$	—	$	(23	)
	Adjustment arising during the year		59			—			—		59			(18	)		—			—		(18	)
	Less: Adjustment for amounts recognized as components of net periodic benefit cost during the year		(15	)		(6	)		—		(21	)		(6	)		2			—		(4	)

Change in amounts recognized in other comprehensive income before income taxes			74			6			—		80			(12	)		(2	)		—		(14	)
	Less: Provision for income taxes		26			2			—		28			(4	)		(1	)		—		(5	)

Change in amounts recognized in other comprehensive income, net of tax			48			4			—		52			(8	)		(1	)		—		(9	)

Balance at December 31, 2007, net of tax		$	(90	)	$	(20	)	$	—	$	(110	)	$	(39	)	$	7		$	—	$	(32	)
	Adjustment arising during the year		(466	)		—			—		(466	)		(8	)		—			—		(8	)
	Less: Adjustment for amounts recognized as components of net periodic benefit cost during the year		(4	)		(7	)		—		(11	)		(4	)		2			—		(2	)

Change in amounts recognized in other comprehensive income before income taxes			(462	)		7			—		(455	)		(4	)		(2	)		—		(6	)
	Less: Provision for income taxes		(167	)		3			—		(164	)		(2	)		—			—		(2	)

Change in amounts recognized in other comprehensive income, net of tax			(295	)		4			—		(291	)		(2	)		(2	)		—		(4	)

Balance at December 31, 2008, net of tax		$	(385	)	$	(16	)	$	—	$	(401	)	$	(41	)	$	5		$	—	$	(36	)
	Adjustment arising during the year		103			—			—		103			11			—			—		11
	Less: Adjustment for amounts recognized as components of net periodic benefit cost during the year		(38	)		(6	)		—		(44	)		(5	)		2			—		(3	)

Change in amounts recognized in other comprehensive income before income taxes			141			6			—		147			16			(2	)		—		14
	Less: Provision for income taxes		52			2			—		54			6			(1	)		—		5

Change in amounts recognized in other comprehensive income, net of tax			89			4			—		93			10			(1	)		—		9

Balance at December 31, 2009, net of tax		$	(296	)	$	(12	)	$	—	$	(308	)	$	(31	)	$	4		$	—	$	(27	)

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		Postretirement Benefit Plan												Total

		Net Loss			Prior Service (Cost) Credit			Net Transition Obligation			Total			Net Loss			Prior Service (Cost) Credit			Net Transition Obligation			Total
		(in millions)
Balance at December 31, 2006, net of tax		$	(8	)	$	(6	)	$	(16	)	$	(30	)	$	(177	)	$	(22	)	$	(16	)	$	(215	)
	Adjustment arising during the year		—			—			—			—			41			—			—			41
	Less: Adjustment for amounts recognized as components of net periodic benefit cost during the year		—			(1	)		(4	)		(5	)		(21	)		(5	)		(4	)		(30	)

Change in amounts recognized in other comprehensive income before income taxes			—			1			4			5			62			5			4			71
	Less: Provision for income taxes		—			1			2			3			22			2			2			26

Change in amounts recognized in other comprehensive income, net of tax			—			—			2			2			40			3			2			45

Balance at December 31, 2007, net of tax		$	(8	)	$	(6	)	$	(14	)	$	(28	)	$	(137	)	$	(19	)	$	(14	)	$	(170	)
	Adjustment arising during the year		(17	)		3			—			(14	)		(491	)		3			—			(488	)
	Less: Adjustment for amounts recognized as components of net periodic benefit cost during the year		(1	)		—			(4	)		(5	)		(9	)		(5	)		(4	)		(18	)

Change in amounts recognized in other comprehensive income before income taxes			(16	)		3			4			(9	)		(482	)		8			4			(470	)
	Less: Provision for income taxes		(6	)		1			1			(4	)		(175	)		4			1			(170	)

Change in amounts recognized in other comprehensive income, net of tax			(10	)		2			3			(5	)		(307	)		4			3			(300	)

Balance at December 31, 2008, net of tax		$	(18	)	$	(4	)	$	(11	)	$	(33	)	$	(444	)	$	(15	)	$	(11	)	$	(470	)
	Adjustment arising during the year		(2	)		—			—			(2	)		112			—			—			112
	Less: Adjustment for amounts recognized as components of net periodic benefit cost during the year		(1	)		(1	)		(4	)		(6	)		(44	)		(5	)		(4	)		(53	)

Change in amounts recognized in other comprehensive income before income taxes			(1	)		1			4			4			156			5			4			165
	Less: Provision for income taxes		—			—			1			1			58			1			1			60

Change in amounts recognized in other comprehensive income, net of tax			(1	)		1			3			3			98			4			3			105

Balance at December 31, 2009, net of tax		$	(19	)	$	(3	)	$	(8	)	$	(30	)	$	(346	)	$	(11	)	$	(8	)	$	(365	)

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Components of net periodic defined benefit cost are as follows:

	Qualified Defined Benefit Pension Plan									Non-Qualified Defined Benefit Pension Plan

	Years Ended December 31
	2009			2008			2007			2009			2008			2007
	(in millions)
Service cost	$	28		$	28		$	30		$	4		$	4		$	4
Interest cost		69			66			62			9			9			8
Expected return on plan assets		(104	)		(100	)		(93	)		—			—			—
Amortization of prior service cost (credit)		6			7			6			(2	)		(2	)		(2	)
Amortization of net loss		38			4			15			5			4			6
Recognition of special agreement benefits		—			—			—			4			—			—

Net periodic defined benefit cost	$	37		$	5		$	20		$	20		$	15		$	16

Additional information:
Actual return (loss) on plan assets	$	200		$	(293	)	$	89		$	—		$	—		$	—

	Postretirement Benefit Plan

	Years Ended December 31
	2009			2008			2007
	(in millions)
Interest cost	$	5		$	5		$	5
Expected return on plan assets		(4	)		(4	)		(4	)
Amortization of transition obligation		4			4			4
Amortization of prior service cost		1			—			1
Amortization of net loss		1			1			—

Net periodic benefit cost	$	7		$	6		$	6

Additional information:
Actual return (loss) on plan assets	$	7		$	(10	)	$	5

The estimated portion of balances remaining in accumulated other comprehensive income (loss) that are expected to be recognized as a component of net periodic benefit cost in the year ended December 31, 2010 are as follows.

	Qualified Defined Benefit Pension Plan		Non-Qualified Defined Benefit Pension Plan			Postretirement Benefit Plan		Total

	(in millions)
Net loss	$	18	$	4		$	1	$	23
Transition obligation		—		—			4	$	4
Prior service cost (credit)		6		(2	)		1	$	5

Actuarial assumptions are reflected below. The discount rate and rate of compensation increase used to determine the benefit obligation for each year shown is as of the end of the year. The discount rate, expected return on plan assets and rate of compensation increase used to determine net cost for each year shown is as of the beginning of the year.

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Weighted-average assumptions used to determine year-end benefit obligations:

	Qualified and Non-Qualified Defined Benefit Pension Plans									Postretirement Benefit Plan

	December 31
	2009			2008			2007			2009			2008			2007
Discount rate		5.92	%		6.03	%		6.47	%		5.41	%		6.20	%		6.15	%
Rate of compensation increase		3.50			4.00			4.00

Weighted-average assumptions used to determine net periodic benefit cost:

	Qualified and Non-Qualified Defined Benefit Pension Plans									Postretirement Benefit Plan

	Years Ended December 31
	2009			2008			2007			2009			2008			2007
Discount rate		6.03	%		6.47	%		5.89	%		6.20	%		6.15	%		5.89	%
Expected long-term return on plan assets		8.25			8.25			8.25			5.00			5.00			5.00
Rate of compensation increase		4.00			4.00			4.00

The long-term rate of return expected on plan assets is set after considering both long-term returns in the general market and long-term returns experienced by the assets in the plan. The returns on the various asset categories are blended to derive one long-term rate of return. The Corporation reviews its pension plan assumptions on an annual basis with its actuarial consultants to determine if assumptions are reasonable and adjusts the assumptions to reflect changes in future expectations.

Assumed healthcare and prescription drug cost trend rates:

	Healthcare						Prescription Drug

	December 31
	2009			2008			2009			2008
Cost trend rate assumed for next year		8.00	%		8.00	%		8.00	%		8.00	%
Rate to which the cost trend rate is assumed to decline (the ultimate trend rate)		5.00			5.00			5.00			5.00
Year that the rate reaches the ultimate trend rate		2030			2028			2030			2028

Assumed healthcare and prescription drug cost trend rates have a significant effect on the amounts reported for the healthcare plans. A one-percentage point change in 2009 assumed healthcare and prescription drug cost trend rates would have the following effects:

	One-Percentage-Point

	Increase		Decrease
	(in millions)
Effect on postretirement benefit obligation	$	5	$	(5	)
Effect on total service and interest cost		—		—

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Plan Assets

The Corporation's overall investment goals for the qualified defined benefit pension plan are to maintain a portfolio of assets of appropriate liquidity and diversification; to generate investment returns (net of operating costs) that are reasonably anticipated to maintain the plan's fully funded status or to reduce a funding deficit, after taking into account various factors, including reasonably anticipated future contributions and expense and the interest rate sensitivity of the plan's assets relative to that of the plan's liabilities; and to generate investment returns (net of operating costs) that meet or exceed a customized benchmark as defined in the plan investment policy. Derivative instruments are permissible for hedging and transactional efficiency, but only to the extent that the derivative use enhances the efficient execution of the plan's investment policy. Securities issued by the Corporation and its subsidiaries are not eligible for use within this plan. The Corporation's target allocations for plan investments are 55 percent to 65 percent equity securities and 35 percent to 45 percent fixed income, including cash. Equity securities include collective investment and mutual funds and common stock. Fixed income securities include U.S. Treasury and other U.S. government agency securities, mortgage-backed securities, corporate bonds and notes, municipal bonds, collateralized mortgage obligations and money market funds.

Fair Value Measurements

The Corporation's qualified defined benefit pension plan utilizes fair value measurements to record fair value adjustments and to determine fair value disclosures. The Corporation's qualified benefit pension plan categorizes investments recorded at fair value into a three-level hierarchy, based on the markets in which the investment are traded and the reliability of the assumptions used to determine fair value. Refer to Note 3 for a description of the three-level hierarchy.

Following is a description of the valuation methodologies and key inputs used to measure the fair value of the Corporation's qualified defined benefit pension plan investments, including an indication of the level of the fair value hierarchy in which the investments are classified.

Collective investment and mutual funds

Fair value measurement is based upon quoted prices in active markets, if available. If quoted prices in active markets are not available, fair values are measured using the net asset value (NAV) provided by the administrator of the fund. The NAV is a quoted price in a market that is not active. Level 1 securities include those traded on an active exchange, such as the New York Stock Exchange, and money market funds. Level 2 securities include collective investment funds measured using the NAV.

Common stock

Fair value measurement is based upon the closing price reported on the New York Stock Exchange. Level 1 common stock includes domestic and foreign stock and real estate investment trusts. Level 2 common stock includes American Depositary Receipts.

U.S. Treasury and other U.S. government agency securities

Fair value measurement is based upon quoted prices, if available. If quoted prices are not available, fair values are measured using independent pricing models or other model-based valuation techniques, such as the present value of future cash flows, adjusted for the security's credit rating, prepayment assumptions and other factors such as credit loss and liquidity assumptions. Level 1 securities include U.S. Treasury securities that are traded by dealers or brokers in active over-the-counter markets. Level 2 securities include pooled Small Business Administration loans.

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Mortgage-backed securities

Fair value measurement is based upon quoted prices and is included in Level 2 of the fair value hierarchy.

Corporate and municipal bonds and notes

Fair value measurement is based upon quoted prices. Level 2 securities include corporate bonds, municipal bonds, other asset-backed securities and foreign bonds and notes.

Collateralized mortgage obligations

Fair value measurement is based upon independent pricing models or other model-based valuation techniques such as the present value of future cash flows, adjusted for the security's credit rating, prepayment assumptions and other factors, such as credit loss and liquidity assumptions, and is included in Level 2 of the fair value hierarchy.

Securities purchased under agreements to resell

Fair value measurement is based upon independent pricing models or other model-based valuation techniques such as the present value of future cash flows, and is included in Level 2 of the fair value hierarchy.

Private placements

Fair value is measured using the NAV provided by fund management, as quoted prices in active markets are not available. Management considers additional discounts to the provided NAV for market and credit risk. Private placements are included in Level 3 of the fair value hierarchy.

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The fair values of the Corporation's qualified defined benefit pension plan investments measured at fair value on a recurring basis at December 31, 2009 and 2008, by asset category and level within the fair value hierarchy, are detailed in the table below.

		Total		Level 1		Level 2		Level 3

		(in millions)
December 31, 2009
Equity securities:
	Collective investment and mutual funds	$	495	$	163	$	332	$	—
	Common stock		320		318		2		—
Fixed income securities:
	U.S. Treasury and other U.S. government agency securities		168		168		—		—
	Corporate and municipal bonds and notes		288		—		288		—
	Collateralized mortgage obligations		6		—		6		—
	Collective investments and mutual funds		20		20		—		—
Private placements			28		—		—		28
Other assets:
	Securities purchased under agreements to resell		5		—		5		—

	Total investments at fair value	$	1,330	$	669	$	633	$	28

December 31, 2008
Equity securities:
	Collective investment and mutual funds	$	250	$	73	$	177	$	—
	Common stock		308		298		10		—
Fixed income securities:
U.S. Treasury and other U.S. government agency securities			65		61		4		—
	Mortgage-backed securities		71		—		71		—
	Corporate and municipal bonds and notes		81		—		81		—
	Collateralized mortgage obligations		113		—		113		—
	Collective investments and mutual funds		189		189		—		—

	Total investments at fair value	$	1,077	$	621	$	456	$	—

The table below provides a summary of changes in the Corporation's qualified defined benefit pension plan's Level 3 investments measured at fair value on a recurring basis for the years ended December 31, 2009 and 2008.

			Gains (Losses)

	Balance at Beginning of Period		Gains (Losses)					Purchases, Sales and Settlements, Net			Balance at End of Period
	Balance at Beginning of Period		Realized		Unrealized			Purchases, Sales and Settlements, Net			Balance at End of Period
	(in millions)
Year ended December 31, 2009
Private placements	$	—	$	—	$	1		$	27		$	28

Year ended December 31, 2008
Private placements	$	4	$	—	$	(1	)	$	(3	)	$	—

There were no assets in the non-qualified defined benefit pension plan at December 31, 2009, and 2008. The postretirement benefit plan is fully invested in bank-owned life insurance policies. The fair value of

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bank-owned life insurance policies is based on the cash surrender values of the policies as reported by the insurance companies and are classified in level 2 of the fair value hierarchy.

Cash Flows

Estimated future employer contributions were zero for the qualified and non-qualified defined benefit pension plans and postretirement benefit plan for the year ended December 31, 2010.

	Estimated Future Benefit Payments

	Qualified Defined Benefit Pension Plan		Non-Qualified Defined Benefit Pension Plan		Postretirement Benefit Plan (a)
	(in millions)
Years Ended December 31
2010	$	46	$	7	$	7
2011		48		8		7
2012		52		9		7
2013		55		9		7
2014		58		10		7
2015-2019		356		57		34

(a): Estimated benefit payments in the postretirement benefit plan are net of estimated Medicare subsidies.

Defined Contribution Plan

Substantially all of the Corporation's employees are eligible to participate in the Corporation's principal defined contribution plan (a 401(k) plan). Under this plan, the Corporation makes core matching cash contributions of 100 percent of the first four percent of qualified earnings contributed by employees (up to the current IRS compensation limit), invested based on employee investment elections. Effective September 16, 2008, the Corporation eliminated Comerica Stock as an investment option for future deposits, including employee contributions, matching contributions and transfers. Employee benefits expense included expense for the plan of $20 million, $22 million and $20 million in the years ended December 31, 2009, 2008 and 2007, respectively.

On January 1, 2007, the Corporation added a defined contribution feature to its principal defined contribution plan for the benefit of substantially all full-time employees hired on or after January 1, 2007. Under the defined contribution feature, the Corporation makes an annual contribution to the individual account of each eligible employee ranging from three percent to eight percent of annual compensation, determined based on combined age and years of service. The contributions are invested based on employee investment elections. The employee fully vests in the defined contribution account after three years of service. Before an employee is eligible to participate, the plan feature requires the equivalent of six months of service for employees hired on or after January 1, 2008 and required one year of service for employees hired in the year ended December 31, 2007. The Corporation recognized $3 million and $2 million in employee benefits expense for this plan feature for the years ended December 31, 2009 and 2008, respectively. No expense was incurred for this plan feature for the year ended December 31, 2007.

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Deferred Compensation Plan

The Corporation offers an optional deferred compensation plan under which certain employees may make an irrevocable election to defer incentive compensation and/or a portion of base salary until retirement or separation from the Corporation. The employee may direct deferred compensation into one or more deemed investment options. Although not required to do so, the Corporation invests actual funds into the deemed investments as directed by employees, resulting in a deferred compensation asset, recorded in "other short-term investments" on the consolidated balance sheets that offsets the liability to employees under the plan, recorded in "accrued expenses and other liabilities." The earnings from the deferred compensation asset are recorded in "interest on short-term investments" and "other noninterest income" and the related change in the liability to employees under the plan is recorded in "salaries" expense on the consolidated statements of income.

Note 20 — Income Taxes and Tax-Related Items

The provision (benefit) for federal income taxes is computed by applying the statutory federal income tax rate to income (loss) before income taxes as reported in the consolidated financial statements after deducting non-taxable items, principally income on bank-owned life insurance, and deducting tax credits related to investments in low income housing partnerships. Tax interest, state and foreign taxes are then added to the federal tax provision.

In the ordinary course of business, the Corporation enters into certain transactions that have tax consequences. From time to time, the Internal Revenue Service (IRS) questions and/or challenges the tax position taken by the Corporation with respect to those transactions. The Corporation believes that its tax returns were filed based upon applicable statutes, regulations and case law in effect at the time of the transactions. The IRS, an administrative authority or a court, if presented with the transactions, could disagree with the Corporation's interpretation of the tax law. After evaluating the risks and opportunities, the best outcome may result in a settlement. The ultimate outcome for each position is not known.

On January 1, 2007, the Corporation adopted new income tax guidance related to accounting for uncertainty in income taxes. On December 31, 2009, the Corporation had net unrecognized tax benefits of less than $0.5 million compared to net unrecognized tax benefits of $70 million at December 31, 2008. After consideration of the effect of the federal tax benefit available on unrecognized state tax benefits, the total amount of unrecognized tax benefits that, if recognized, would affect the Corporation's effective tax rate was approximately $32 million at December 31, 2009 and $56 million at December 31, 2008. Accrued interest and penalties were $19 million and $85 million at December 31, 2009 and 2008, respectively.

The Corporation recognized a benefit of approximately $19 million in 2009 in interest and penalties on income tax liabilities included in the "provision (benefit) for income taxes" on the consolidated statements of income, compared with expense of approximately $8 million in 2008 and $5 million in 2007. The 2009 interest and penalties on income tax liabilities includes an $18 million reduction of interest due to anticipated refunds due from the IRS. The 2007 interest and penalties on income tax liabilities were net of a $9 million reduction of interest resulting from settlement with the IRS on a refund claim.

The amount of interest and penalties accrued at December 31, 2009 included interest for unrecognized tax benefits in addition to interest accrued for structured leasing transactions that are expected to be paid in the first quarter 2010. The Corporation engaged in certain types of structured leasing transactions that the IRS disallowed. In the third quarter 2008 the IRS issued a settlement offer which the Corporation subsequently accepted. The settlement resolved all tax issues associated with structured leasing transactions.

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In 2009 there was a decline in unrecognized tax benefits due to the closing of the IRS examination of years 2001-2004, the amending of certain state income tax returns and the recognition of certain anticipated refunds from the IRS. For further information regarding the settlement refer to the table below.

A reconciliation of the beginning and ending amount of unrecognized tax benefit follows:

		Unrecognized Tax Benefits

		(in millions)
Balance at January 1, 2009		$	70
	Increases as a result of tax positions taken during a prior period		2
	Increases as a result of tax positions taken during a current period		1
	Decreases as a result of filing amended tax returns		(34	)
	Decreases as a result of tax positions taken during a current period		(1	)
	Decreases as a result of tax positions taken during a prior period		(38	)

Balance at December 31, 2009		$	—

The Corporation anticipates that it is reasonably possible that settlements of federal and state tax issues will result in an increase in unrecognized tax benefits of approximately $6 million within the next twelve months.

Based on current knowledge and probability assessment of various potential outcomes, the Corporation believes that current tax reserves, determined in accordance with income tax guidance, are adequate to cover the matters outlined above, and the amount of any incremental liability arising from these matters is not expected to have a material adverse effect on the Corporation's consolidated financial condition or results of operations. Probabilities and outcomes are reviewed as events unfold, and adjustments to the reserves are made when necessary.

The following tax years for significant jurisdictions remain subject to examination as of December 31, 2009:

Jurisdiction		Tax Years

Federal			2005-2008
California			2004-2008

On January 1, 2007, the Corporation adopted new leasing guidance that required a recalculation of lease income from the inception of a leveraged lease if, during the lease term, the expected timing of the income tax cash flows generated from a leveraged lease is revised. In 2007 the Corporation recorded a one-time non-cash after-tax charge to beginning retained earnings of $46 million to reflect changes in expected timing of the income tax cash flows generated from affected leveraged leases (structured leasing transactions), which is expected to be recognized as income over periods ranging from 3 years to 18 years.

In 2008 the Corporation reassessed the size and timing of the tax deductions related to the structured leasing transactions discussed above which resulted in a $38 million ($24 million after-tax) charge to lease income in the year ended December 31, 2008. The charges, unless the leases are terminated, will fully reverse over the next 18 years.

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The current and deferred components of the provision for income taxes for continuing operations were as follows:

			December 31

			2009			2008			2007
			(in millions)
Current
	Federal		$	(28	)	$	126		$	322
	Foreign			6			10			11
	State and local			3			22			26

		Total current		(19	)		158			359
Deferred
	Federal			(102	)		(86	)		(51	)
	State and local			(10	)		(13	)		(2	)

		Total deferred		(112	)		(99	)		(53	)

		Total	$	(131	)	$	59		$	306

Loss from continuing operations before income taxes of $115 million for the year ended December 31, 2009, included $27 million of foreign-source income.

Income from discontinued operations, net of tax, included a provision for income taxes on discontinued operations of $1 million, $1 million and $2 million for the years ended December 31, 2009, 2008 and 2007, respectively. The income tax provision on securities transactions was $85 million, $23 million and $2 million for the years ended December 31, 2009, 2008 and 2007, respectively.

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The principal components of deferred tax assets and liabilities were as follows:

			December 31

			2009			2008
			(in millions)
Deferred tax assets:
	Allowance for loan losses		$	344		$	279
	Deferred loan origination fees and costs			27			21
	Other comprehensive income			192			175
	Employee benefits			—			17
	Foreign tax credit			13			6
	Tax interest			7			31
	Auction-rate securities			24			29
	Other temporary differences, net			72			68

		Total deferred tax assets before valuation allowance		679			626
	Valuation allowance			(1	)		(1	)

		Total deferred tax assets, net of valuation allowance		678			625
Deferred tax liabilities:
	Lease financing transactions			(458	)		(580	)
	Allowance for depreciation			(42	)		(16	)
	Employee benefits			(20	)		—

		Total deferred tax liabilities		(520	)		(596	)

		Net deferred tax asset	$	158		$	29

Included in deferred tax assets at December 31, 2009 were net state tax credit carry-forwards of $5 million. The credits will expire in 2027. The valuation allowance of $1 million for certain state deferred tax assets was unchanged in 2009 compared to 2008. The Corporation determined that a valuation allowance was not needed against the federal deferred tax assets. This determination was based on sufficient taxable income in the carry-back period to absorb a significant portion of the deferred tax assets. The remaining federal deferred tax assets will be absorbed by future reversals of existing taxable temporary differences. For further information on the Corporation's valuation policy for deferred tax assets, refer to Note 1.

At December 31, 2009, the Corporation had undistributed earnings of approximately $146 million related to a foreign subsidiary. The Corporation intends to reinvest these earnings indefinitely. The amount of income tax that would be due on these earnings if repatriated to the United States would be approximately $53 million.

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A reconciliation of expected income tax expense at the federal statutory rate of 35 percent to the Corporation's provision for income taxes for continuing operations and effective tax rate follows:

	Years Ended December 31

	2009						2008						2007
	Amount			Rate			Amount			Rate			Amount			Rate
	(dollar amounts in millions)
Tax based on federal statutory rate	$	(40	)		35.0	%	$	95			35.0	%	$	346			35.0	%
State income taxes		(5	)		3.9			5			2.0			16			1.6
Affordable housing and historic credits		(46	)		40.2			(45	)		(16.5	)		(36	)		(3.6	)
Bank-owned life insurance		(14	)		12.0			(15	)		(5.5	)		(14	)		(1.4	)
Disallowance of foreign tax credit		—			—			9			3.2			—			—
Termination of structured leasing transactions		(11	)		9.8			—			—			—			—
Other changes in unrecognized tax benefits		1			(1.1	)		10			3.7			—			—
Interest on income tax liabilities		(13	)		10.9			6			2.0			3			0.3
Other		(3	)		3.0			(6	)		(2.2	)		(9	)		(0.9	)

Provision (benefit) for income taxes	$	(131	)		113.7	%	$	59			21.7	%	$	306			31.0	%

Note 21 — Transactions with Related Parties

The Corporation's banking subsidiaries had, and expect to have in the future, transactions with the Corporation's directors and executive officers, companies with which these individuals are associated, and certain related individuals. Such transactions were made in the ordinary course of business and included extensions of credit, leases and professional services. With respect to extensions of credit, all were made on substantially the same terms, including interest rates and collateral, as those prevailing at the same time for comparable transactions with other customers and did not, in management's opinion, involve more than normal risk of collectibility or present other unfavorable features. The aggregate amount of loans attributable to persons who were related parties at December 31, 2009, totaled $341 million at the beginning of 2009 and $342 million at the end of 2009. During 2009, new loans to related parties aggregated $333 million and repayments totaled $332 million.

Note 22 — Regulatory Capital and Reserve Requirements

Reserves required to be maintained and/or deposited with the FRB were classified in cash and due from banks through September 30, 2008, and were subsequently classified in interest-bearing deposits with banks, coincident with the date the FRB commenced paying interest on such balances. These reserve balances vary, depending on the level of customer deposits in the Corporation's banking subsidiaries. The average required reserve balances were $290 million and $292 million for the years ended December 31, 2009 and 2008, respectively.

Banking regulations limit the transfer of assets in the form of dividends, loans or advances from the bank subsidiaries to the parent company. Under the most restrictive of these regulations, the aggregate amount of dividends which can be paid to the parent company without obtaining prior approval from bank regulatory agencies approximated $56 million at January 1, 2010, plus 2010 net profits. Substantially all the assets of the Corporation's banking subsidiaries are restricted from transfer to the parent company of the Corporation in the form of loans or advances.

Dividends declared to the parent company of the Corporation by its banking subsidiaries amounted to $59 million, $267 million and $614 million in 2009, 2008 and 2007, respectively.

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The Corporation and its U.S. banking subsidiaries are subject to various regulatory capital requirements administered by federal and state banking agencies. Quantitative measures established by regulation to ensure capital adequacy require the maintenance of minimum amounts and ratios of Tier 1 and total capital (as defined in the regulations) to average and risk-weighted assets. Failure to meet minimum capital requirements can initiate certain mandatory and possibly additional discretionary actions by regulators that, if undertaken, could have a direct material effect on the Corporation's financial statements. At December 31, 2009 and 2008, the Corporation and its U. S. banking subsidiaries exceeded the ratios required for an institution to be considered "well capitalized" (total risk-based capital, Tier 1 risk-based capital and leverage ratios greater than 10 percent, six percent and five percent, respectively). There were no conditions or events since December 31, 2009 that management believes have changed the capital adequacy classification of the Corporation or its U.S. banking subsidiaries.

The Corporation participated in the U. S. Treasury Capital Purchase Program in the fourth quarter 2008 and issued preferred stock and a related warrant totaling $2.25 billion, which qualifies as Tier 1 capital and significantly increased Tier 1 and total capital ratios for Comerica Incorporated (Consolidated). For more information regarding the Capital Purchase Program, refer to Note 15 to the consolidated financial statements. The following is a summary of the capital position of the Corporation and Comerica Bank, its principal banking subsidiary.

		Comerica Incorporated (Consolidated)			Comerica Bank

		(dollar amounts in millions)
December 31, 2009
	Tier 1 capital (minimum-$2.5 billion (Consolidated))	$	7,104		$	5,763
	Total capital (minimum-$4.9 billion (Consolidated))		10,468			8,226
	Risk-weighted assets		61,815			61,566
	Average assets (fourth quarter)		58,153			57,837
	Tier 1 capital to risk-weighted assets (minimum-4.0%)		12.46	%		9.36	%
	Total capital to risk-weighted assets (minimum-8.0%)		16.93			13.36
	Tier 1 capital to average assets (minimum-3.0%)		13.25			9.96
December 31, 2008
	Tier 1 capital (minimum-$2.9 billion (Consolidated))	$	7,805		$	5,707
	Total capital (minimum-$5.9 billion (Consolidated))		10,774			8,378
	Risk-weighted assets		73,207			72,909
	Average assets (fourth quarter)		66,309			66,071
	Tier 1 capital to risk-weighted assets (minimum-4.0%)		10.66	%		7.83	%
	Total capital to risk-weighted assets (minimum-8.0%)		14.72			11.49
	Tier 1 capital to average assets (minimum-3.0%)		11.77			8.64

Note 23 — Contingent Liabilities

Legal Proceedings

The Corporation and certain of its subsidiaries are subject to various pending or threatened legal proceedings arising out of the normal course of business or operations. In view of the inherent difficulty of predicting the outcome of such matters, the Corporation cannot state the eventual outcome of these matters. However, based on current knowledge and after consultation with legal counsel, management believes that current reserves are adequate, and the amount of any incremental liability arising from these matters is not

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expected to have a material adverse effect on the Corporation's consolidated financial condition. For information regarding income tax contingencies, refer to Note 20.

Note 24 — Business Segment Information

The Corporation has strategically aligned its operations into three major business segments: the Business Bank, the Retail Bank, and Wealth & Institutional Management. These business segments are differentiated based on the type of customer and the related products and services provided. In addition to the three major business segments, the Finance Division is also reported as a segment. Business segment results are produced by the Corporation's internal management accounting system. This system measures financial results based on the internal business unit structure of the Corporation. Information presented is not necessarily comparable with similar information for any other financial institution. The management accounting system assigns balance sheet and income statement items to each business segment using certain methodologies, which are regularly reviewed and refined. For comparability purposes, amounts in all periods are based on business segments and methodologies in effect at December 31, 2009. These methodologies, which are briefly summarized in the following paragraph, may be modified as management accounting systems are enhanced and changes occur in the organizational structure or product lines.

The Corporation's internal funds transfer pricing system records cost of funds or credit for funds using a combination of matched maturity funding for certain assets and liabilities and a blended rate based on various maturities for the remaining assets and liabilities. The allowance for loan losses is allocated to both large business and certain large personal purpose consumer and residential mortgage loans that have deteriorated below certain levels of credit risk based on a non-standard, specifically calculated amount. Additional loan loss reserves are allocated based on industry-specific risk and are maintained to capture probable losses due to the inherent imprecision in the risk rating system and new business migration risk not captured in the credit scores of individual loans. For other business loans, the allowance for loan losses is recorded in business units based on the credit score of each loan outstanding. For other consumer and residential mortgage loans, it is allocated based on applying estimated loss ratios to various segments of the loan portfolio. The related loan loss provision is assigned based on the amount necessary to maintain an allowance for loan losses adequate for each product category. Noninterest income and expenses directly attributable to a line of business are assigned to that business segment. Direct expenses incurred by areas whose services support the overall Corporation are allocated to the business segments as follows: product processing expenditures are allocated based on standard unit costs applied to actual volume measurements; administrative expenses are allocated based on estimated time expended; and corporate overhead is assigned 50 percent based on the ratio of the business segment's noninterest expenses to total noninterest expenses incurred by all business segments and 50 percent based on the ratio of the business segment's attributed equity to total attributed equity of all business segments. Equity is attributed based on credit, operational and interest rate risks. Most of the equity attributed relates to credit risk, which is determined based on the credit score and expected remaining life of each loan, letter of credit and unused commitment recorded in the business units. Operational risk is allocated based on loans and letters of credit, deposit balances, non-earning assets, trust assets under management, certain noninterest income items, and the nature and extent of expenses incurred by business units. Virtually all interest rate risk is assigned to Finance, as are the Corporation's hedging activities.

The following discussion provides information about the activities of each business segment. A discussion of the financial results and the factors impacting 2009 performance can be found in the section entitled "Business Segments" in the financial review.

The Business Bank is primarily composed of the following businesses: Middle Market, Commercial Real Estate, National Dealer Services, International Finance, Global Corporate, Leasing, Financial Services, and Technology and Life Sciences. This business segment meets the needs of medium-size businesses, multinational

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corporations and governmental entities by offering various products and services, including commercial loans and lines of credit, deposits, cash management, capital market products, international trade finance, letters of credit, foreign exchange management services and loan syndication services.

The Finance segment includes the Corporation's securities portfolio and asset and liability management activities. This segment is responsible for managing the Corporation's funding, liquidity and capital needs, performing interest sensitivity analysis and executing various strategies to manage the Corporation's exposure to liquidity, interest rate risk and foreign exchange risk.

The Other category includes discontinued operations, the income and expense impact of equity and cash, tax benefits not assigned to specific business segments and miscellaneous other expenses of a corporate nature.

Business segment financial results are as follows:

	Year Ended December 31, 2009

	Business Bank			Retail Bank			Wealth & Institutional Management			Finance			Other			Total
	(dollar amounts in millions)
Earnings summary:
Net interest income (expense) (FTE)	$	1,328		$	510		$	161		$	(461	)	$	37		$	1,575
Provision for loan losses		860			143			62			—			17			1,082
Noninterest income		291			190			269			292			8			1,050
Noninterest expenses		638			642			302			17			51			1,650
Provision (benefit) for income taxes (FTE)		(26	)		(37	)		23			(76	)		(7	)		(123	)
Income from discontinued operations, net of tax		—			—			—			—			1			1

Net income (loss)	$	147		$	(48	)	$	43		$	(110	)	$	(15	)	$	17

Net credit-related charge-offs	$	712		$	119		$	38		$	—		$	—		$	869
Selected average balances:
Assets	$	36,102		$	6,566		$	4,883		$	11,777		$	3,481		$	62,809
Loans		35,402			6,007			4,758			1			(6	)		46,162
Deposits		15,395			17,409			2,654			4,564			69			40,091
Liabilities		15,605			17,378			2,645			19,586			496			55,710
Attributed equity		3,385			635			365			1,043			1,671			7,099
Statistical data:
Return on average assets (a)		0.41	%		(0.27	)%		0.87	%		N/M			N/M			0.03	%
Return on average attributed equity		4.36			(7.63	)		11.71			N/M			N/M			(2.37	)
Net interest margin (b)		3.75			2.93			3.35			N/M			N/M			2.72
Efficiency ratio		39.36			91.69			72.60			N/M			N/M			69.25

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	Year Ended December 31, 2008

	Business Bank			Retail Bank			Wealth & Institutional Management (c)			Finance			Other			Total
	(dollar amounts in millions)
Earnings summary:
Net interest income (expense) (FTE)	$	1,277		$	566		$	148		$	(147	)	$	(23	)	$	1,821
Provision for loan losses		543			123			25			—			(5	)		686
Noninterest income		302			258			292			68			(27	)		893
Noninterest expenses		709			645			422			11			(36	)		1,751
Provision (benefit) for income taxes (FTE)		90			22			(3	)		(42	)		(2	)		65
Income from discontinued operations, net of tax		—			—			—			—			1			1

Net income (loss)	$	237		$	34		$	(4	)	$	(48	)	$	(6	)	$	213

Net credit-related charge-offs	$	392		$	64		$	16		$	—		$	—		$	472
Selected average balances:
Assets	$	41,786		$	7,074		$	4,689		$	10,011		$	1,625		$	65,185
Loans		40,867			6,342			4,542			1			13			51,765
Deposits		14,993			16,965			2,433			7,252			360			42,003
Liabilities		15,706			16,961			2,451			23,893			732			59,743
Attributed equity		3,276			676			336			927			227			5,442
Statistical data:
Return on average assets (a)		0.57	%		0.19	%		(0.09	)%		N/M			N/M			0.33	%
Return on average attributed equity		7.24			4.98			(1.31	)		N/M			N/M			3.79
Net interest margin (b)		3.13			3.34			3.24			N/M			N/M			3.02
Efficiency ratio		45.29			83.21			96.97			N/M			N/M			66.17
	Year Ended December 31, 2007
	Business Bank			Retail Bank			Wealth & Institutional Management			Finance			Other			Total
	(dollar amounts in millions)
Earnings summary:
Net interest income (expense) (FTE)	$	1,349		$	670		$	145		$	(133	)	$	(25	)	$	2,006
Provision for loan losses		178			41			(3	)		—			(4	)		212
Noninterest income		291			220			283			65			29			888
Noninterest expenses		709			654			322			10			(4	)		1,691
Provision (benefit) for income taxes (FTE)		237			67			39			(40	)		6			309
Income from discontinued operations, net of tax		—			—			—			—			4			4

Net income (loss)	$	516		$	128		$	70		$	(38	)	$	10		$	686

Net credit-related charge-offs	$	117		$	34		$	2		$	—		$	—		$	153
Selected average balances:
Assets	$	40,762		$	6,880		$	4,096		$	5,669		$	1,167		$	58,574
Loans		39,721			6,134			3,937			7			22			49,821
Deposits		16,253			17,156			2,386			6,174			(35	)		41,934
Liabilities		17,090			17,170			2,392			16,530			322			53,504
Attributed equity		2,936			850			332			627			325			5,070
Statistical data:
Return on average assets (a)		1.27	%		0.71	%		1.71	%		N/M			N/M			1.17	%
Return on average attributed equity		17.57			15.04			21.15			N/M			N/M			13.52
Net interest margin (b)		3.40			3.92			3.67			N/M			N/M			3.66
Efficiency ratio		43.49			73.43			75.17			N/M			N/M			58.58

(a): Return on average assets is calculated based on the greater of average assets or average liabilities and attributed equity.
(b): Net interest margin is calculated based on the greater of average earning assets or average deposits and purchased funds.
(c): 2008 included an $88 million net charge ($56 million, after-tax) related to the repurchase of auction-rate securities from customers.

FTE — Fully Taxable Equivalent

N/M — Not Meaningful

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The Corporation's management accounting system also produces market segment results for the Corporation's four primary geographic markets: Midwest, Western, Texas, and Florida. In addition to the four primary geographic markets, Other Markets and International are also reported as market segments. Market segment results are provided as supplemental information to the business segment results and may not meet all operating segment criteria as set forth in ASC Topic 280, Segment Reporting. The following discussion provides information about the activities of each market segment. A discussion of the financial results and the factors impacting 2008 performance can be found in the section entitled "Geographic Market Segments" in the financial review.

The Midwest market consists of operations located in the states of Michigan, Ohio and Illinois. Currently, Michigan operations represent the significant majority of this geographic market.

The Western market consists of the states of California, Arizona, Nevada, Colorado and Washington. Currently, California operations represent the significant majority of the Western market.

The Texas and Florida markets consist of operations located in the states of Texas and Florida, respectively.

Other Markets include businesses with a national perspective, the Corporation's investment management and trust alliance businesses as well as activities in all other markets in which the Corporation has operations, except for the International market, as described below.

The International market represents the activity of the Corporation's International Finance division, which provides banking services primarily to foreign-owned, North American-based companies and secondarily to international operations of North American-based companies.

The Finance & Other Businesses segment includes the Corporation's securities portfolio, asset and liability management activities, discontinued operations, the income and expense impact of equity and cash not assigned to specific business/market segments, tax benefits not assigned to specific business/market segments and miscellaneous other expenses of a corporate nature. This segment includes responsibility for managing the Corporation's funding, liquidity and capital needs, performing interest sensitivity analysis and executing various strategies to manage the Corporation's exposure to liquidity, interest rate risk and foreign exchange risk.

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Market segment financial results are as follows:

	Year Ended December 31, 2009

	Midwest			Western			Texas			Florida			Other Markets			International			Finance & Other Businesses			Total
	(dollar amounts in millions)
Earnings summary:
Net interest income (expense) (FTE)	$	807		$	623		$	298		$	44		$	158		$	69		$	(424	)	$	1,575
Provision for loan losses		448			358			85			59			82			33			17			1,082
Noninterest income		435			133			86			12			51			33			300			1,050
Noninterest expenses		761			432			238			37			83			31			68			1,650
Provision (benefit) for income taxes (FTE)		(4	)		(20	)		21			(17	)		(34	)		14			(83	)		(123	)
Income from discontinued operations, net of tax		—			—			—			—			—			—			1			1

Net income (loss)	$	37		$	(14	)	$	40		$	(23	)	$	78		$	24		$	(125	)	$	17

Net credit-related charge-offs	$	351		$	327		$	53		$	48		$	72		$	18		$	—		$	869
Selected average balances:
Assets	$	17,575		$	14,479		$	7,604		$	1,741		$	4,198		$	1,954		$	15,258		$	62,809
Loans		16,965			14,281			7,384			1,745			3,883			1,909			(5	)		46,162
Deposits		17,117			11,104			4,512			311			1,586			828			4,633			40,091
Liabilities		17,334			11,022			4,516			300			1,639			817			20,082			55,710
Attributed equity		1,569			1,378			697			173			404			164			2,714			7,099
Statistical data:
Return on average assets (a)		0.19	%		(0.10	)%		0.52	%		(1.34	)%		1.87	%		1.25	%		N/M			0.03	%
Return on average attributed equity		2.34			(1.02	)		5.70			(13.54	)		19.41			14.93			N/M			(2.37	)
Net interest margin (b)		4.71			4.36			4.03			2.50			4.09			3.53			N/M			2.72
Efficiency ratio		61.23			57.19			61.88			66.96			42.58			30.31			N/M			69.25
	Year Ended December 31, 2008
	Midwest			Western			Texas			Florida			Other Markets (c)			International			Finance & Other Businesses			Total
	(dollar amounts in millions)
Earnings summary:
Net interest income (expense) (FTE)	$	776		$	668		$	292		$	47		$	147		$	61		$	(170	)	$	1,821
Provision for loan losses		155			379			51			40			62			4			(5	)		686
Noninterest income		524			139			94			16			48			31			41			893
Noninterest expenses		813			448			246			42			186			41			(25	)		1,751
Provision (benefit) for income taxes (FTE)		127			(1	)		36			(6	)		(65	)		18			(44	)		65
Income from discontinued operations, net of tax		—			—			—			—			—			—			1			1

Net income (loss)	$	205		$	(19	)	$	53		$	(13	)	$	12		$	29		$	(54	)	$	213

Net credit-related charge-offs (recoveries)	$	152		$	241		$	25		$	27		$	26		$	1		$	—		$	472
Selected average balances:
Assets	$	19,786		$	16,855		$	8,039		$	1,896		$	4,624		$	2,349		$	11,636		$	65,185
Loans		19,062			16,565			7,776			1,892			4,217			2,239			14			51,765
Deposits		16,039			11,918			4,023			288			1,374			749			7,612			42,003
Liabilities		16,672			11,895			4,040			283			1,479			749			24,625			59,743
Attributed equity		1,639			1,339			627			130			396			157			1,154			5,442
Statistical data:
Return on average assets (a)		1.04	%		(0.11	)%		0.66	%		(0.70	)%		0.25	%		1.25	%		N/M			0.33	%
Return on average attributed equity		12.50			(1.43	)		8.48			(10.26	)		2.95			18.69			N/M			3.79
Net interest margin (b)		4.07			4.04			3.75			2.47			3.47			2.66			N/M			3.02
Efficiency ratio		65.25			55.82			64.57			67.78			97.69			43.80			N/M			66.17

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	Year Ended December 31, 2007

	Midwest			Western			Texas			Florida			Other Markets			International			Finance & Other Businesses			Total
	(dollar amounts in millions)
Earnings summary:
Net interest income (expense) (FTE)	$	889		$	740		$	286		$	46		$	135		$	68		$	(158	)	$	2,006
Provision for loan losses		88			108			8			11			16			(15	)		(4	)		212
Noninterest income		471			130			86			14			55			38			94			888
Noninterest expenses		820			456			235			38			92			44			6			1,691
Provision (benefit) for income taxes (FTE)		158			116			45			4			(7	)		27			(34	)		309
Income from discontinued operations, net of tax		—			—			—			—			—			—			4			4

Net income (loss)	$	294		$	190		$	84		$	7		$	89		$	50		$	(28	)	$	686

Net credit-related charge-offs	$	110		$	28		$	9		$	2		$	10		$	(6	)	$	—		$	153
Selected average balances:
Assets	$	19,133		$	17,091		$	7,106		$	1,688		$	4,490		$	2,230		$	6,836		$	58,574
Loans		18,559			16,552			6,827			1,672			4,081			2,101			29			49,821
Deposits		15,772			13,325			3,884			286			1,433			1,095			6,139			41,934
Liabilities		16,437			13,361			3,901			287			1,550			1,116			16,852			53,504
Attributed equity		1,723			1,213			595			97			335			155			952			5,070
Statistical data:
Return on average assets (a)		1.53	%		1.11	%		1.19	%		0.41	%		1.99	%		2.25	%		N/M			1.17	%
Return on average attributed equity		16.98			15.69			14.19			7.20			26.68			32.42			N/M			13.52
Net interest margin (b)		4.78			4.48			4.19			2.77			3.34			3.14			N/M			3.66
Efficiency ratio		60.58			52.37			63.12			63.76			48.40			42.36			N/M			58.58

(a): Return on average assets is calculated based on the greater of average assets or average liabilities and attributed equity.
(b): Net interest margin is calculated based on the greater of average earning assets or average deposits and purchased funds.
(c): 2008 included an $88 million net charge ($56 million, after-tax) related to the repurchase of auction-rate securities from customers.

FTE — Fully Taxable Equivalent

N/M — Not Meaningful

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Note 25 — Parent Company Financial Statements

BALANCE SHEETS — COMERICA INCORPORATED

			December 31

			2009			2008
			(in millions, except share data)
ASSETS
Cash and due from subsidiary bank			$	5		$	11
Short-term investments with subsidiary bank				2,150			2,329
Other short-term investments				86			80
Investment in subsidiaries, principally banks				5,710			5,690
Premises and equipment				4			5
Other assets				186			210

		Total assets	$	8,141		$	8,325

LIABILITIES AND SHAREHOLDERS' EQUITY
Medium- and long-term debt			$	986		$	1,002
Other liabilities				126			171

		Total liabilities		1,112			1,173
Fixed rate cumulative perpetual preferred stock, series F, no par value, $1,000 liquidation preference per share:
	Authorized — 2,250,000 shares
	Issued — 2,250,000 shares at 12/31/09 and 12/31/08			2,151			2,129
Common stock — $5 par value:
	Authorized — 325,000,000 shares
	Issued — 178,735,252 shares at 12/31/09 and 12/31/08			894			894
Capital surplus				740			722
Accumulated other comprehensive loss				(336	)		(309	)
Retained earnings				5,161			5,345
Less cost of common stock in treasury — 27,555,623 shares at 12/31/09 and 28,244,967 shares at 12/31/08				(1,581	)		(1,629	)

		Total shareholders' equity		7,029			7,152

		Total liabilities and shareholders' equity	$	8,141		$	8,325

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STATEMENTS OF INCOME — COMERICA INCORPORATED

			Years Ended December 31

			2009			2008			2007
			(in millions)
INCOME
Income from subsidiaries
	Dividends from subsidiaries		$	59		$	267		$	614
	Other interest income			4			4			15
	Intercompany management fees			44			156			149
Other noninterest income				6			(32	)		15

		Total income		113			395			793
EXPENSES
Interest on medium- and long-term debt				42			50			60
Salaries and employee benefits				88			74			108
Net occupancy expense				9			8			7
Equipment expense				1			1			1
Other noninterest expenses				47			55			51

		Total expenses		187			188			227

Income before income taxes and equity in undistributed earnings of subsidiaries				(74	)		207			566
Provision (benefit) for income taxes				(47	)		(25	)		(22	)

Income before equity in undistributed earnings of subsidiaries				(27	)		232			588
Equity in undistributed earnings (losses) of subsidiaries, principally banks (including discontinued operations)				44			(19	)		98

NET INCOME			$	17		$	213		$	686

Net income (loss) attributable to common shares			$	(118	)	$	192		$	680

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STATEMENTS OF CASH FLOWS — COMERICA INCORPORATED

			Years Ended December 31

			2009			2008			2007
			(in millions)
OPERATING ACTIVITIES
Net income			$	17		$	213		$	686
Adjustments to reconcile net income to net cash provided by operating activities:
	Undistributed (earnings) losses of subsidiaries, principally banks (including discontinued operations)			(44	)		19			(98	)
	Depreciation and software amortization			1			1			1
	Share-based compensation expense			12			18			20
	Provision (benefit) for deferred income taxes			1			(10	)		(15	)
	Excess tax benefits from share-based compensation arrangements			—			—			(9	)
	Other, net			14			19			49

		Net cash provided by operating activities		1			260			634
INVESTING ACTIVITIES
Net proceeds from private equity and venture capital investments				—			2			3
Capital transactions with subsidiaries				—			—			(62	)
Net increase in fixed assets				—			(2	)		(1	)

		Net cash (used in) provided by investing activities		—			—			(60	)
FINANCING ACTIVITIES
Proceeds from issuance of medium- and long-term debt				—			—			665
Repayment of medium- and long-term debt				—			—			(510	)
Proceeds from issuance of common stock				—			1			89
Proceeds from issuance of preferred stock and related warrant				—			2,250			—
Purchase of common stock for treasury				(1	)		(1	)		(580	)
Dividends paid on common stock				(72	)		(395	)		(390	)
Dividends paid on preferred stock				(113	)		—			—
Excess tax benefits from share-based compensation arrangements				—			—			9

		Net cash provided by (used in) financing activities		(186	)		1,855			(717	)

Net (decrease) increase in cash and cash equivalents				(185	)		2,115			(143	)
Cash and cash equivalents at beginning of year				2,340			225			368

Cash and cash equivalents at end of year			$	2,155		$	2,340		$	225

Interest paid			$	44		$	51		$	57

Income taxes recovered			$	(45	)	$	(3	)	$	(39	)

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Comerica Incorporated and Subsidiaries

Note 26 — Sales of Businesses/Discontinued Operations

In December 2006, the Corporation sold its ownership interest in Munder Capital Management (Munder) to an investor group. The sale agreement included an interest-bearing contingent note with an initial principal amount of $70 million, which will be realized if the Corporation's client-related revenues earned by Munder remain consistent with 2006 levels of approximately $17 million per year for the five years following the closing of the transaction (2007-2011). The principal amount of the note may increase, to a maximum of $80 million, or decrease depending on the level of such revenues earned in the five years following the closing. Repayment of the principal is scheduled to begin after the sixth anniversary of the closing of the transaction from Munder's excess cash flows, as defined in the sale agreement. The note matures in December 2013. Future gains related to the contingent note are expected to be recognized periodically through maturity of the note as targets for the Corporation's client-related revenues earned by Munder and revenue recognition criteria are achieved.

As a result of the sale transaction, the Corporation reported Munder as a discontinued operation in all periods presented. The assets and liabilities related to the discontinued operations of Munder are not material and have not been reclassified on the consolidated balance sheets.

The components of net income from discontinued operations for the years ended December 31, 2009, 2008 and 2007, were as follows:

		2009		2008		2007

		(in millions, except per share data)
Income from discontinued operations before income taxes		$	2	$	2	$	6
Provision for income taxes			1		1		2

Net income from discontinued operations		$	1	$	1	$	4

Earnings per common share from discontinued operations:
	Basic	$	0.01	$	0.01	$	0.03
	Diluted		0.01		—		0.03

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Comerica Incorporated and Subsidiaries

Note 27 — Summary of Quarterly Financial Statements (Unaudited)

The following quarterly information is unaudited. However, in the opinion of management, the information reflects all adjustments, which are necessary for the fair presentation of the results of operations, for the periods presented.

		2009

		Fourth Quarter			Third Quarter			Second Quarter			First Quarter
		(in millions, except per share data)
Interest income		$	479		$	511		$	552		$	563
Interest expense			83			126			150			179

Net interest income			396			385			402			384
Provision for loan losses			256			311			312			203
Net securities gains			10			107			113			13
Noninterest income (excluding net securities gains)			204			208			185			210
Noninterest expenses			425			399			429			397
Provision (benefit) for income taxes			(42	)		(29	)		(59	)		(1	)

Income (loss) from continuing operations			(29	)		19			18			8
Income from discontinued operations, net of tax			—			—			—			1

Net income (loss)		$	(29	)	$	19		$	18		$	9

Net loss attributable to common shares		$	(62	)	$	(16	)	$	(16	)	$	(24	)

Basic earnings per common share:
	Loss from continuing operations	$	(0.42	)	$	(0.10	)	$	(0.11	)	$	(0.17	)
	Net loss		(0.42	)		(0.10	)		(0.11	)		(0.16	)
Diluted earnings per common share:
	Loss from continuing operations		(0.42	)		(0.10	)		(0.11	)		(0.17	)
	Net loss		(0.42	)		(0.10	)		(0.11	)		(0.16	)

148

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Comerica Incorporated and Subsidiaries

		2008

		Fourth Quarter			Third Quarter		Second Quarter		First Quarter
		(in millions, except per share data)
Interest income		$	716		$	735	$	737	$	863
Interest expense			285			269		295		387

Net interest income			431			466		442		476
Provision for loan losses			192			165		170		159
Net securities gains			4			27		14		22
Noninterest income (excluding net securities gains)			170			213		228		215
Noninterest expenses			411			514		423		403
Provision (benefit) for income taxes			(17	)		—		35		41

Income from continuing operations			19			27		56		110
Income (loss) from discontinued operations, net of tax			1			1		—		(1	)

Net income		$	20		$	28	$	56	$	109

Net income attributable to common shares		$	2		$	28	$	54	$	108

Basic earnings per common share:
	Income from continuing operations	$	0.01		$	0.17	$	0.36	$	0.73
	Net income		0.01			0.18		0.36		0.73
Diluted earnings per common share:
	Income from continuing operations		0.01			0.17		0.36		0.73
	Net income		0.01			0.18		0.36		0.73

149

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REPORT OF MANAGEMENT

The management of Comerica Incorporated (the Corporation) is responsible for the accompanying consolidated financial statements and all other financial information in this Annual Report. The consolidated financial statements have been prepared in conformity with U.S. generally accepted accounting principles and include amounts which of necessity are based on management's best estimates and judgments and give due consideration to materiality. The other financial information herein is consistent with that in the consolidated financial statements.

In meeting its responsibility for the reliability of the consolidated financial statements, management develops and maintains effective internal controls, including those over financial reporting, as defined in the Securities and Exchange Act of 1934, as amended. The Corporation's internal control over financial reporting includes policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Corporation; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of the consolidated financial statements in conformity with U.S. generally accepted accounting principles, and that receipts and expenditures of the Corporation are made only in accordance with authorizations of management and directors of the Corporation; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Corporation's assets that could have a material effect on the consolidated financial statements.

Management assessed, with participation of the Corporation's Chief Executive Officer and Chief Financial Officer, internal control over financial reporting as it relates to the Corporation's consolidated financial statements presented in conformity with U.S. generally accepted accounting principles as of December 31, 2009. The assessment was based on criteria for effective internal control over financial reporting described in Internal Control — Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Based on this assessment, management determined that internal control over financial reporting is effective as it relates to the Corporation's consolidated financial statements presented in conformity with U.S. generally accepted accounting principles as of December 31, 2009.

Because of inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

The consolidated financial statements as of December 31, 2009 were audited by Ernst & Young LLP, an independent registered public accounting firm. The audit was conducted in accordance with the standards of the Public Company Accounting Oversight Board (United States), which required the independent public accountants to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement and whether effective internal control over financial reporting is maintained in all material respects.

The Corporation's Board of Directors oversees management's internal control over financial reporting and financial reporting responsibilities through its Audit Committee as well as various other committees. The Audit Committee, which consists of directors who are not officers or employees of the Corporation, meets regularly with management, internal audit and the independent public accountants to assure that the Audit Committee, management, internal auditors and the independent public accountants are carrying out their responsibilities, and to review auditing, internal control and financial reporting matters.



Ralph W. Babb, Jr. Chairman, President and Chief Executive Officer	Elizabeth S. Acton Executive Vice President and Chief Financial Officer	Marvin J. Elenbaas Senior Vice President and Chief Accounting Officer

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

Board of Directors and Shareholders
Comerica Incorporated

We have audited Comerica Incorporated's internal control over financial reporting as of December 31, 2009, based on criteria established in Internal Control — Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (the COSO criteria). Comerica Incorporated's management is responsible for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying Report of Management. Our responsibility is to express an opinion on the Corporation's internal control over financial reporting based on our audit.

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

A company's internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company's internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Corporation; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Corporation are being made only in accordance with authorizations of management and directors of the Corporation; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the Corporation's assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

In our opinion, Comerica Incorporated maintained, in all material respects, effective internal control over financial reporting as of December 31, 2009, based on the COSO criteria.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the 2009 consolidated financial statements of Comerica Incorporated and subsidiaries and our report dated February 25, 2010 expressed an unqualified opinion thereon.

/s/ ERNST & YOUNG LLP

Dallas, Texas
February 25, 2010

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

Board of Directors and Shareholders
Comerica Incorporated

We have audited the accompanying consolidated balance sheets of Comerica Incorporated and subsidiaries as of December 31, 2009 and 2008, and the related consolidated statements of income, shareholders' equity, and cash flows for each of the three years in the period ended December 31, 2009. These financial statements are the responsibility of the Corporation's management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated financial position of Comerica Incorporated and subsidiaries at December 31, 2009 and 2008, and the consolidated results of their operations and their cash flows for each of the three years in the period ended December 31, 2009, in conformity with U.S. generally accepted accounting principles.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), Comerica Incorporated's internal control over financial reporting as of December 31, 2009, based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February 25, 2010, expressed an unqualified opinion thereon.

/s/ ERNST & YOUNG LLP

Dallas, Texas
February 25, 2010

152

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HISTORICAL REVIEW — AVERAGE BALANCE SHEETS

Comerica Incorporated and Subsidiaries

CONSOLIDATED FINANCIAL INFORMATION

			Years Ended December 31

			2009			2008			2007			2006			2005
			(in millions)
ASSETS
Cash and due from banks			$	883		$	1,185		$	1,352		$	1,557		$	1,721
Federal funds sold and securities purchased under agreements to resell				18			93			164			283			390
Interest-bearing deposits with banks				2,440			219			15			110			30
Other short-term investments				154			244			241			156			135
Investment securities available-for-sale				9,388			8,101			4,447			3,992			3,861
Commercial loans				24,534			28,870			28,132			27,341			24,575
Real estate construction loans				4,140			4,715			4,552			3,905			3,194
Commercial mortgage loans				10,415			10,411			9,771			9,278			8,566
Residential mortgage loans				1,756			1,886			1,814			1,570			1,388
Consumer loans				2,553			2,559			2,367			2,533			2,696
Lease financing				1,231			1,356			1,302			1,314			1,283
International loans				1,533			1,968			1,883			1,809			2,114

		Total loans		46,162			51,765			49,821			47,750			43,816
Less allowance for loan losses				(947	)		(691	)		(520	)		(499	)		(623	)

		Net loans		45,215			51,074			49,301			47,251			43,193
Accrued income and other assets				4,711			4,269			3,054			3,230			3,176

		Total assets	$	62,809		$	65,185		$	58,574		$	56,579		$	52,506

LIABILITIES AND SHAREHOLDERS' EQUITY
Noninterest-bearing deposits			$	12,900		$	10,623		$	11,287		$	13,135		$	15,007
Money market and NOW deposits				12,965			14,245			14,937			15,373			17,282
Savings deposits				1,339			1,344			1,389			1,441			1,545
Customer certificates of deposit				8,131			8,150			7,687			6,505			5,418

	Total interest-bearing core deposits			22,435			23,739			24,013			23,319			24,245
Other time deposits				4,103			6,715			5,563			4,489			511
Foreign office time deposits				653			926			1,071			1,131			877

	Total interest-bearing deposits			27,191			31,380			30,647			28,939			25,633

		Total deposits		40,091			42,003			41,934			42,074			40,640
Short-term borrowings				1,000			3,763			2,080			2,654			1,451
Accrued expenses and other liabilities				1,285			1,520			1,293			1,268			1,132
Medium- and long-term debt				13,334			12,457			8,197			5,407			4,186

		Total liabilities		55,710			59,743			53,504			51,403			47,409
Total shareholders' equity				7,099			5,442			5,070			5,176			5,097

		Total liabilities and shareholders' equity	$	62,809		$	65,185		$	58,574		$	56,579		$	52,506

153

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HISTORICAL REVIEW — STATEMENTS OF INCOME

Comerica Incorporated and Subsidiaries

CONSOLIDATED FINANCIAL INFORMATION

			Years Ended December 31

			2009			2008		2007			2006		2005
			(in millions, except per share data)
INTEREST INCOME
Interest and fees on loans			$	1,767		$	2,649	$	3,501		$	3,216	$	2,554
Interest on investment securities				329			389		206			174		148
Interest on short-term investments				9			13		23			32		24

		Total interest income		2,105			3,051		3,730			3,422		2,726
INTEREST EXPENSE
Interest on deposits				372			734		1,167			1,005		548
Interest on short-term borrowings				2			87		105			130		52
Interest on medium- and long-term debt				164			415		455			304		170

		Total interest expense		538			1,236		1,727			1,439		770

		Net interest income		1,567			1,815		2,003			1,983		1,956
Provision for loan losses				1,082			686		212			37		(47	)

		Net interest income after provision for loan losses		485			1,129		1,791			1,946		2,003
NONINTEREST INCOME
Service charges on deposit accounts				228			229		221			218		218
Fiduciary income				161			199		199			180		174
Commercial lending fees				79			69		75			65		63
Letter of credit fees				69			69		63			64		70
Card fees				51			58		54			46		39
Foreign exchange income				41			40		40			38		37
Bank-owned life insurance				35			38		36			40		38
Brokerage fees				31			42		43			40		36
Net securities gains				243			67		7			—		—
Income from lawsuit settlement				—			—		—			47		—
Other noninterest income				112			82		150			117		144

		Total noninterest income		1,050			893		888			855		819
NONINTEREST EXPENSES
Salaries				687			781		844			823		786
Employee benefits				210			194		193			184		178

		Total salaries and employee benefits		897			975		1,037			1,007		964
Net occupancy expense				162			156		138			125		118
Equipment expense				62			62		60			55		53
Outside processing fee expense				97			104		91			85		77
FDIC insurance expense				90			16		5			5		7
Software expense				84			76		63			56		49
Other real estate expense				48			10		7			4		12
Legal fees				37			29		24			28		26
Litigation and operational losses				10			103		18			11		14
Customer services				4			13		43			47		69
Provision for credit losses on lending-related commitments				—			18		(1	)		5		18
Other noninterest expenses				159			189		206			246		206

		Total noninterest expenses		1,650			1,751		1,691			1,674		1,613

Income (loss) from continuing operations before income taxes				(115	)		271		988			1,127		1,209
Provision (benefit) for income taxes				(131	)		59		306			345		393

Income from continuing operations				16			212		682			782		816
Income from discontinued operations, net of tax				1			1		4			111		45

NET INCOME			$	17		$	213	$	686		$	893	$	861

Net income (loss) attributable to common shares			$	(118	)	$	192	$	680		$	886	$	858

Basic earnings per common share:
	Income (loss) from continuing operations		$	(0.80	)	$	1.28	$	4.43		$	4.85	$	4.88
	Net income (loss)			(0.79	)		1.29		4.45			5.53		5.15
Diluted earnings per common share:
	Income (loss) from continuing operations			(0.80	)		1.28		4.40			4.81		4.84
	Net income (loss)			(0.79	)		1.28		4.43			5.49		5.11
Cash dividends declared on common stock				30			348		393			380		367
Cash dividends declared per common share				0.20			2.31		2.56			2.36		2.20

154

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HISTORICAL REVIEW — STATISTICAL DATA

Comerica Incorporated and Subsidiaries

CONSOLIDATED FINANCIAL INFORMATION

		Years Ended December 31

		2009			2008			2007			2006			2005
AVERAGE RATES (FULLY TAXABLE EQUIVALENT BASIS)
Federal funds sold and securities purchased under agreements to resell			0.32	%		2.08	%		5.28	%		5.15	%		3.29	%
Interest-bearing deposits with banks			0.25			0.61			4.00			5.86			9.97
Other short-term investments			1.74			3.98			5.75			7.26			6.62
Investment securities available-for-sale			3.61			4.83			4.56			4.22			3.76
Commercial loans			3.63			5.08			7.25			6.87			5.62
Real estate construction loans			2.92			4.89			8.21			8.61			7.23
Commercial mortgage loans			4.20			5.57			7.26			7.27			6.23
Residential mortgage loans			5.53			5.94			6.13			6.02			5.74
Consumer loans			3.68			5.08			7.00			7.13			5.89
Lease financing			3.25			0.59			3.04			4.00			3.81
International loans			3.79			5.13			7.06			7.01			5.98

	Total loans		3.84			5.13			7.03			6.74			5.84

	Interest income as a percentage of earning assets		3.64			5.06			6.82			6.53			5.65
Domestic deposits			1.39			2.33			3.77			3.42			2.07
Deposits in foreign offices			0.29			2.77			4.85			4.82			4.18

	Total interest-bearing deposits		1.37			2.34			3.81			3.47			2.14
Short-term borrowings			0.24			2.30			5.06			4.89			3.59
Medium- and long-term debt			1.23			3.33			5.55			5.63			4.05

	Interest expense as a percentage of interest-bearing sources		1.29			2.59			4.22			3.89			2.46

Interest rate spread			2.35			2.47			2.60			2.64			3.19
Impact of net noninterest-bearing sources of funds			0.37			0.55			1.06			1.15			0.87

Net interest margin as a percentage of earning assets			2.72	%		3.02	%		3.66	%		3.79	%		4.06	%

RATIOS
Return on average common shareholders' equity			(2.37	)%		3.79	%		13.52	%		17.24	%		16.90	%
Return on average assets			0.03			0.33			1.17			1.58			1.64
Efficiency ratio			69.25			66.17			58.58			58.92			58.01
Tier 1 common capital as a percentage of risk-weighted assets (a)			8.18			7.08			6.85			7.54			7.78
Tier 1 capital as a percentage of risk-weighted assets			12.46			10.66			7.51			8.03			8.38
Total capital as a percentage of risk-weighted assets			16.93			14.72			11.20			11.64			11.65
Tangible common equity as a percentage of tangible assets (a)			7.99			7.21			7.97			8.62			9.16
PER COMMON SHARE DATA
Book value at year-end		$	31.82		$	33.31		$	34.12		$	32.70		$	31.11
Market value at year-end			29.57			19.85			43.53			58.68			56.76
Market value for the year
	High		32.30			45.19			63.89			60.10			63.38
	Low		11.72			15.05			39.62			50.12			53.17
OTHER DATA (share data in millions)
Average common shares outstanding — basic			149			149			153			160			167
Average common shares outstanding — diluted			149			149			154			161			168
Number of banking centers			447			439			417			393			383
Number of employees (full-time equivalent)
	Continuing operations		9,330			10,186			10,782			10,700			10,636
	Discontinued operations		—			—			—			—			180

(a): See Supplemental Financial Data section for reconcilements of non-GAAP financial measures.

155

Exhibit 21

Subsidiaries of Registrant

As of December 31, 2009

Name		State or Jurisdiction of Incorporation or Organization

Cass & Co.		Cayman Islands
CDV I Incorporated		Delaware
Comerica AHOC, LLC		Delaware
Comerica Assurance Ltd.		Bermuda
Comerica Bank		Texas
Comerica Bank & Trust, National Association		United States
Comerica Capital Advisors Incorporated		Delaware
Comerica Capital Markets Corporation		Michigan
Comerica Capital Trust II		Delaware
Comerica Coastal Incorporated		Delaware
Comerica do Brasil Participacoes e Servicos Ltda.		Brazil
Comerica Equities Incorporated		Delaware
Comerica Financial Incorporated (f/k/a/ Comerica AutoLease, Inc.)		Michigan
Comerica Holdings Incorporated		Delaware
Comerica Insurance Group, Inc.		Michigan
Comerica Insurance Services, Inc.		Michigan
Comerica Insurance Services of Texas Incorporated (f/k/a CMA Insurance Services, Inc.)		Texas
Comerica International Corporation		USA
Comerica Investments, LLC		Delaware
Comerica Investment Services, Inc.		Michigan
Comerica Leasing Corporation (f/k/a CMCA Lease, Inc.)		Michigan
Comerica Management Company		Michigan
Comerica Merchant Services, Inc.		Delaware
Comerica Properties Corporation		Michigan
Comerica Securities, Inc.		Michigan
Comerica Trade Services Limited		Hong Kong
Comerica Ventures Incorporated (f/k/a Imperial Ventures, Inc.)		California
Comerica West Enterprises Incorporated		Delaware
Comerica West Financial Incorporated		Delaware
DFP Luxembourg S.A.		Luxembourg
Imperial Capital Trust I		Delaware
Interstate Select Insurance Services, Inc.		California
NBF Reverse Exchange, LLC		Delaware
Denbury Conroe, LLC		Delaware

Rica & Co., Ltd.		British Virgin Islands
ROC Technologies Inc.		Delaware
VRB Corp.		Michigan
VRB Douglas Road, LLC		Delaware
VRB Orland, LLC		Delaware
VRB Wasco, LLC		Delaware
VRB Croftwood, LLC		Delaware
VRB Country Villas, LLC		Delaware
VRB Sundance Village, LLC		Delaware
VRB Rancho Encantado, LLC		Delaware
WAM Holdings, Inc.		Delaware
Munder UK, LLC		Delaware
Wilson, Kemp & Associates, Inc.		Michigan
World Asset Management, Inc.		Delaware
Comerica Capital Trust III		Delaware

Exhibit 23.1

Consent of Independent Registered Public Accounting Firm

We consent to the incorporation by reference in this Annual Report (Form 10-K) of Comerica Incorporated of our report dated February 25, 2010, with respect to the consolidated financial statements of Comerica Incorporated, included in the 2009 Annual Report to Shareholders of Comerica Incorporated.

We consent to the incorporation by reference in the following Registration Statements:

Registration Statement No. 33-42485 on Form S-8 dated August 29, 1991

Registration Statement No. 33-45500 on Form S-8 dated February 11, 1992

Registration Statement No. 33-49964 on Form S-8 dated July 23, 1992

Registration Statement No. 33-49966 on Form S-8 dated July 23, 1992

Registration Statement No. 33-53220 on Form S-8 dated October 13, 1992

Registration Statement No. 33-53222 on Form S-8 dated October 13, 1992

Registration Statement No. 33-58823 on Form S-8 dated April 26, 1995

Registration Statement No. 33-58837 on Form S-8 dated April 26, 1995

Registration Statement No. 33-58841 on Form S-8 dated April 26, 1995

Registration Statement No. 33-65457 on Form S-8 dated December 29, 1995

Registration Statement No. 33-65459 on Form S-8 dated December 29, 1995

Registration Statement No. 333-00839 on Form S-8 dated February 9, 1996

Registration Statement No. 333-04297 on Form S-3 dated May 22, 1996

Registration Statement No. 333-24569 on Form S-8 dated April 4, 1997

Registration Statement No. 333-24567 on Form S-8 dated April 4, 1997

Registration Statement No. 333-24565 on Form S-8 dated April 4, 1997

Registration Statement No. 333-24555 on Form S-8 dated April 4, 1997

Registration Statement No. 333-37061 on Form S-8 dated October 2, 1997

Registration Statement No. 333-48118 on Form S-8 dated October 18, 2000

Registration Statement No. 333-48120 on Form S-8 dated October 18, 2000

Registration Statement No. 333-48122 on Form S-8 dated October 18, 2000

Registration Statement No. 333-48124 on Form S-8 dated October 18, 2000

Registration Statement No. 333-48126 on Form S-8 dated October 18, 2000

Registration Statement No. 333-50966 on Form S-8 dated November 30, 2000

Registration Statement No. 333-51042 on Form S-8 to Form S-4 dated February 6, 2001

Registration Statement No. 333-63090 on Form S-3 dated June 15, 2001 as amended on

Form S-3/A dated July 10, 2001

Registration Statement No. 333-104163 on Form S-8 dated March 31, 2003

Registration Statement No. 333-104164 on Form S-8 dated March 31, 2003

Registration Statement No. 333-48124 on Form S-8 dated August 14, 2003

Registration Statement No. 333-107962 on Form S-8 dated August 14, 2003

Registration Statement No. 333-110791 on Form S-8 dated November 26, 2003

Registration Statement No. 333-110792 on Form S-8 dated November 26, 2003

Registration Statement No. 333-117788 on Form S-8 dated July 30, 2004

Registration Statement No. 333-136053 on Form S-8 dated July 26, 2006

Registration Statement No. 333-138924 on Form S-3 dated November 22, 2006

Registration Statement No. 333-163220 on Form S-3 dated November 19, 2009

of our reports dated February 25, 2010, with respect to the consolidated financial statements of Comerica Incorporated and the effectiveness of internal control over financial reporting of Comerica Incorporated incorporated herein by reference for the year ended December 31, 2009.

February 25, 2010
Dallas, Texas
/s/ Ernst & Young LLP

Exhibit 31.1

Chairman, President and CEO Rule 13a-14(a)/15d-14(a) Certification of Periodic Report (pursuant to Section 302 of the Sarbanes-Oxley Act of 2002)

CERTIFICATION OF PERIODIC REPORT

PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Ralph W. Babb, Jr., Chairman, President and Chief Executive Officer of Comerica Incorporated (the “Registrant”), certify that:

1. I have reviewed this annual report on Form 10-K of the Registrant for the year ended December 31, 2009;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the Registrant as of, and for, the periods presented in this report;

4. The Registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15(d)-15(f)) for the Registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this Report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the Registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the Registrant’s internal control over financial reporting that occurred during the Registrant’s most recent fiscal quarter (the Registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the Registrant’s internal control over financial reporting; and

5. The Registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Registrant’s auditors and the audit committee of the Registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant’s internal control over financial reporting.

Date: February 25, 2010	/s/ Ralph W. Babb, Jr.
	Ralph W. Babb, Jr.
	Chairman, President and
	Chief Executive Officer

Exhibit 31.2

Executive Vice President and CFO Rule 13a-14(a)/15d-14(a) Certification of Periodic Report (pursuant to Section 302 of the Sarbanes-Oxley Act of 2002)

CERTIFICATION OF PERIODIC REPORT

PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Elizabeth S. Acton, Executive Vice President and Chief Financial Officer of Comerica Incorporated (the “Registrant”), certify that:

1. I have reviewed this annual report on Form 10-K of the Registrant for the year ended December 31, 2009;

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant’s internal control over financial reporting.

Date: February 25, 2010	/s/ Elizabeth S. Acton
	Elizabeth S. Acton
	Executive Vice President and
	Chief Financial Officer

Exhibit 32

Section 1350 Certification of Periodic Report (pursuant to Section 906 of the Sarbanes-Oxley Act of 2002)

CERTIFICATION OF PERIODIC REPORT

PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

The undersigned, Ralph W. Babb, Jr., Chairman, President and Chief Executive Officer, and Elizabeth S. Acton, Executive Vice President and Chief Financial Officer, of Comerica Incorporated (the “Company”), certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350, that:

(1) the Annual Report on Form 10-K of the Company for the year ended December 31, 2009 (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m or 78o(d)); and

(2) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Dated: February 25, 2010


	/s/ Ralph W. Babb, Jr.
	Name: Ralph W. Babb, Jr.
	Chairman, President and
	Chief Executive Officer


	/s/ Elizabeth S. Acton
	Name: Elizabeth S. Acton
	Executive Vice President and
	Chief Financial Officer

Exhibit 99.1

Certification Pursuant to 31 C.F.R. § 30.15

I, Ralph W. Babb, Jr., certify, based on my knowledge, that:

(i) The Governance, Compensation and Nominating Committee (the compensation committee) of Comerica Incorporated discussed, reviewed, and evaluated with senior risk officers on January 26, 2010, which date is within six months from September 14, 2009 (the later of September 14, 2009 or ninety days after the closing date of the agreement between the TARP recipient and Treasury) (the applicable period), the senior executive officer (SEO) compensation plans and the employee compensation plans and the risks these plans pose to Comerica Incorporated;

(ii) The compensation committee of Comerica Incorporated has identified and limited during the applicable period any features of the SEO compensation plans that could lead SEOs to take unnecessary and excessive risks that could threaten the value of Comerica Incorporated, and during that same applicable period has identified any features of the employee compensation plans that pose risks to Comerica Incorporated and has limited those features to ensure that Comerica Incorporated is not unnecessarily exposed to risks;

(iii) The compensation committee has reviewed, at least every six months during the applicable period, the terms of each employee compensation plan and identified any features of the plan that could encourage the manipulation of reported earnings of Comerica Incorporated to enhance the compensation of an employee, and has limited any such features;

(iv) The compensation committee of Comerica Incorporated will certify to the reviews of the SEO compensation plans and employee compensation plans required under (i) and (iii) above;

(v) The compensation committee of Comerica Incorporated will provide a narrative description of how it limited during any part of the most recently completed fiscal year that included a TARP period the features in (A) SEO compensation plans that could lead SEOs to take unnecessary and excessive risks that could threaten the value of Comerica Incorporated; (B) Employee compensation plans that unnecessarily expose Comerica Incorporated to risks; and (C) Employee compensation plans that could encourage the manipulation of reported earnings of Comerica Incorporated to enhance the compensation of an employee;

(vi) Comerica Incorporated has required that bonus payments, as defined in the regulations and guidance established under section 111 of EESA (bonus payments), of the SEOs and twenty next most highly compensated employees be subject to a recovery or ‘‘clawback’’ provision during any part of the most recently completed fiscal year that was a TARP period if the bonus payments were based on materially inaccurate financial statements or any other materially inaccurate performance metric criteria;

(vii) Comerica Incorporated has prohibited any golden parachute payment, as defined in the regulations and guidance established under section 111 of EESA, to an SEO or any of the next five most highly compensated employees during the period beginning on the later of the closing date of the agreement between the TARP recipient and Treasury or June 15, 2009 and ending with the last day of the TARP recipient’s fiscal year containing that date;

(viii) Comerica Incorporated has limited bonus payments to its applicable employees in accordance with section 111 of EESA and the regulations and guidance established thereunder during the period beginning on the later of the closing date of the agreement between the TARP recipient and Treasury or June 15, 2009 and ending with the last day of the TARP recipient’s fiscal year containing that date;

(ix) The board of directors of Comerica Incorporated has established an excessive or luxury expenditures policy, as defined in the regulations and guidance established under section 111 of EESA, by the later of September 14, 2009, or ninety days after the closing date of the agreement between the TARP recipient and Treasury; this policy has been provided to Treasury and its primary regulatory agency; Comerica Incorporated and its employees have complied with this policy during the applicable period; and any expenses that, pursuant to this policy, required approval of the board of directors, a committee of the board of directors, an SEO, or an executive officer with a similar level of responsibility were properly approved;

(x) Comerica Incorporated will permit a non-binding shareholder resolution in compliance with any applicable Federal securities rules and regulations on the disclosures provided under the Federal securities laws related to SEO compensation paid or accrued during the period beginning on the later of the closing date of the agreement between TARP recipient and Treasury or June 15, 2009 and ending with the last day of TARP Recipient’s fiscal year containing that date;

(xi) Comerica Incorporated will disclose the amount, nature, and justification for the offering during the period beginning on the later of the closing date of the agreement between the TARP recipient and Treasury or June 15, 2009 and ending with the last day of the TARP recipient’s fiscal year containing that date of any perquisites, as defined in the regulations and guidance established under section 111 of EESA, whose total value exceeds $25,000 for any employee who is subject to the bonus payment limitations identified in paragraph (viii);

(xii) Comerica Incorporated will disclose whether Comerica Incorporated, the board of directors of Comerica Incorporated, or the compensation committee of Comerica Incorporated has engaged during the period beginning on the later of the closing date of the agreement between the TARP recipient and Treasury or June 15, 2009 and ending with the last day of the TARP recipient’s fiscal year containing that date, a compensation consultant; and the services the compensation consultant or any affiliate of the compensation consultant provided during this period;

(xiii) Comerica Incorporated has prohibited the payment of any gross ups, as defined in the regulations and established under section 111 of EESA, to the SEOs and the next twenty most highly compensated employees during the period beginning on the later of the closing date of the agreement between the TARP recipient and Treasury or June 15, 2009 and ending with the last day of the TARP recipient’s fiscal year containing that date;

(xiv) Comerica Incorporated has substantially complied with all other requirements related to employee compensation that are provided in the agreement between Comerica Incorporated and Treasury, including any amendments;

(xv) Comerica Incorporated has submitted to Treasury a complete and accurate list of the SEOs and the twenty next most highly compensated employees for the current fiscal year and the most recently completed fiscal year, with the non-SEOs ranked in descending order of level of annual compensation, and with the name, title, and employer of each SEO and most highly compensated employee identified; and

(xvi) I understand that a knowing and willful false or fraudulent statement made in connection with this certification may be punished by fine, imprisonment, or both. (See, for example, 18 U.S.C. 1001.)

Date: February 24, 2010	/s/ Ralph W. Babb, Jr.
	Ralph W. Babb, Jr.
	Chairman, President and
	Chief Executive Officer (Principal Executive Officer)

Exhibit 99.2

Certification Pursuant to 31 C.F.R. § 30.15

I, Elizabeth S. Acton, certify, based on my knowledge, that:

(iv) The compensation committee of Comerica Incorporated will certify to the reviews of the SEO compensation plans and employee compensation plans required under (i) and (iii) above;

Date: February 24, 2010	/s/ Elizabeth S. Acton
	Elizabeth S. Acton
	Executive Vice President and
	Chief Financial Officer (Principal Financial Officer)