All right. Good morning, everyone. I have Jim Herzog here from Comerica, Chief Financial Officer, also former treasurer. Obviously understands deposit betas and hedging and interest rate risks. We're gonna get into some of that today. Jim has some prepared comments that they'd like to make in a deck that they filed last night. Then we'll get into Q&A. We're open for business on questions, so any of you that have questions, you'll be able to fire away during the Q&A as well. Take it away, Jim. Thank you. All right. Yeah, thank you, John. Good morning, everyone. Before we get started, I'd like to remind you that today's presentation contains forward-looking statements. I refer you to slide two for our safe harbor statement, which I incorporate into this presentation, as well as our filings with the SEC for factors that could cause actual results to differ materially from expectations. Forward-looking statements speak only as of the date of this presentation. We undertake no obligation to update any forward-looking statements. Also, this presentation will reference non-GAAP measures. In that regard, I direct you to the reconciliation of these measures in the appendix to this presentation, which is also available on our website, comerica.com. Slide three provides a brief overview of Comerica. We are a leading bank for business with over 90% of our loans to commercial entities, complemented by very strong wealth management and retail capabilities. Greenwich recently recognized our distinguished approach to middle market and small business banking with 17 awards, including Best Brand – Values Long-Term Relationships. We believe our unique model delivers shareholder value by creating a sustainable competitive advantage and has driven our success for over 170 years. Our focus on large metropolitan areas is summarized on slide four. With offices in 14 of the 15 largest and 9 of the 10 top fastest-growing MSAs, we invest in growth markets with a concentration of our target customers. Based on the needs and preferences of those customers, we develop and maintain 4 relationships nationally, leveraging offices, travel, and technology. Beyond our primary markets, we are selectively expanding, bringing our middle market and wealth management expertise into the Southeast and Mountain West regions, where we already have representation from our national businesses. Successfully attracting key local talent paired with internal colleagues familiar with our process and culture is proving to be the right strategy to export our business model to these growth markets. Our Southeast results exceeded expectations in 2022. A strong pipeline supports continued momentum. Striking a balance between local presence and national coverage, we feel we can have an efficient and effective coverage model. Moving to slide five. Our colleagues are key to our relationship approach with the targeted skills, diversity and tenure to deliver our distinctive model. Beginning with our new hire training program and reinforced throughout career progression, we develop a balance of credit and relationship management skills that we believe are valued by our current and prospective customers. Diversity, equity, and inclusion is woven into the essence of who we are and how we act. Finally, long tenure at all levels provides consistent delivery of service to our customers through cycles. This is true particularly in our industry verticals, where we believe this deep experience enhances the value we provide beyond traditional products and services. Together, we feel this model supports our ability to win new customers and, importantly, to build long-term relationships over time. Slide six reinforces our differentiated model. We have a unique commercial franchise in attractive markets, which is driving strong revenue performance with continued loan growth and investment in fee income solutions. Collaboration enhances our financial results as we deliver retail, wealth management, and commercial solutions to our customers as one Comerica. We continually seek opportunities to enhance the efficiency of our operations. With credit as a cornerstone of our business, we feel our proven discipline drives outperformance through cycles. With superior financial results in 2022, we've built a solid foundation to support continued success. Moving to slide seven, we'll shift to our mid-quarter update, starting with loans. Through the first two months of the quarter, average loans are up almost $700 million or over 1% compared to the fourth quarter of 2022. Growth is right in line with the outlook we provided, with the largest increases in commercial real estate, National Dealer Services, and middle market. Consistent with last quarter, increase in utilization with funding of existing projects is driving commercial real estate. We remain conservative in our approach. Over 90% of new business comes from existing well-capitalized customers with strong track records, largely financing the construction of Class A multifamily and industrial buildings. Credit metrics have continued to be excellent. M&A activity in our National Dealer Services business has driven term debt and commercial mortgages, while floorplan balances continued on a slow rebound with improved supply of inventory and higher vehicle prices. Middle market has had solid growth, particularly in the Texas market, as we successfully win new relationships and support existing customers. Given the interest rate environment and housing supply, mortgage banker has continued to decline, with average balances down over $250 million in the fourth quarter. Pipeline across our business is solid, and our strong outlook for the quarter and the year remains unchanged. As shown on slide eight, we have continued to strategically manage our relationship deposits. Quarter to date deposits average $69 billion through February 28th. Fourth quarter pricing adjustments are working. Pricing adjustments are working with average interest-bearing deposit balances increasing almost $600 million through February. Our deposit beta remains in line with expectations and total funding costs remain very low at 71 basis points in the fourth quarter, which compares favorably to our peers. Based on our analysis, we believe non-interest-bearing deposits have continued to be impacted in relatively equal parts by customers moving into interest-bearing accounts to seek yield, customers utilizing cash in their business consistent with loan growth trends and normal seasonality. Far in the quarter, the total deposit balance trend has not differed materially from our traditional seasonal pattern and has benefited from the increase in interest-bearing deposits. Considering the non-interest-bearing deposit pressures, we believe average total deposits will decline between 3% and 4% in the first quarter of 2023 compared to the fourth quarter of 2022, and decline approximately 9%-10% for the full year of 2023 relative to 2022. We remain in active dialogue with our customers and are closely monitoring portfolio dynamics. We still expect to maintain a favorable mix at or above approximately 50% of non-interest-bearing deposits by year-end. This is well above the peer average and demonstrates the consistency and relationship nature of our deposit base. The environment remains dynamic and additional Fed actions may impact our projections. We feel the slower pace of rate changes we have seen enhances our ability to manage deposits and execute pricing strategies. Our liquidity position remains strong, as shown in slide nine. At 75% at the end of the fourth quarter, our loan to deposit ratio was well positioned relative to our peers and below our average of almost 90% over the last 15 years. We expect to maintain a cash buffer at the Fed of at least $2 billion-$3 billion, and with the fourth quarter average of $4 billion, we are right in line with our pre-pandemic position. We look to fund loan growth, we plan to continue our diversified approach that begins with redeploying liquidity generated by securities repayments. Based on the higher rate environment, we expect the pace of MBS repayment to decrease modestly to approximately $350 million-$400 million per quarter. We expect $700 million in treasuries to mature in the first quarter. Beyond securities, as I mentioned, we are actively managing deposits and considering strategies to bring back incremental balances as necessary. In addition, we have efficient borrowing channels such as brokered deposits and approximately $7 billion in FHLB lines available as of last quarter end. Low wholesale funding at only 8% of total liabilities provides us flexibility. Upcoming maturities remain very manageable. We are confident we have highly effective tools to support our growth. We are prioritizing investment in non-capital consuming consistent fee income products that produce consistent revenue streams. This is a key part of our growth strategy, as outlined on slide 10. Cash management is core to our customers' operations and with transformational leadership in payments and technology, we are making enhancements to further improve the experience and functionality. As a leading bank for business, we believe we are well positioned to be a leading bank for business owners and continue to leverage this as we grow wealth management through hiring new talent and strategic partnerships. On this note, you may have seen a press release last Friday where we announced a strategic partnership with Ameriprise Financial to serve as our new securities investment program provider. We anticipate conversion later this year. We do expect some transition related expenses that may be in the range of $10 million-$15 million for the full year 2023. That includes approximately $8 million in the first quarter. Neither of these amounts were included in our 2023 expense outlook that we offered in January. We believe this arrangement should be accretive by the end of the second year. This has traditionally been a small part of our offering. We are very excited about this growth opportunity that we feel will elevate the customer experience by delivering enhanced tools and capabilities. Staying on the theme of non-interest income opportunities, we recently announced a new M&A advisory team, as discussed on slide 11. Relative to our size, we believe our pre-existing capital market solutions outperform and we see opportunities to enhance that position. Culture and fit are critical to capitalize on the promising opportunity that exists to address the M&A needs within our commercial portfolio, and we feel we have the right model and team to do just that. Led by a tenured industry veteran, our new M&A advisory group has the potential to drive incremental fee income over time, enhance customer retention and create opportunities for wealth management as we support customers through their life cycle. While it takes time to work through the pipeline from introduction to a customer through the sale of a business, we are excited about the traction the team has already made. Over time, we expect non-interest income growth will enhance the mix and predictability of our revenue stream accruing to the benefit of our shareholders. Slide 12 provides an update on our interest rate sensitivity and compelling that net interest income potential. Based on the February 28th forward curve and current market dynamics, we continue to expect a 3%-6% decline in first quarter net interest income relative to the fourth quarter due to two fewer days, seasonal deposit outflows and continued deposit pricing actions. We expect strong loan results and the benefit of rates to offset increased deposit pressures relative to our original forecast for the quarter. We project net interest income growth weighted towards the second half of the year as we continue to benefit from rates and increasing loans in conjunction with expanding relationships and acquiring new customers. For the full year, our outlook remains unchanged, projecting strong net interest income up 17%-20% over our record 2022 level as we expect relative to prior guidance deposit runoff to be offset by the higher curve. Our asset sensitivity position is in our target range as we've minimized the risk of lower rates and protected a high level of net interest income, as evidenced by our modeled reduction of only $70 million in the gradual down 100 basis point scenario. Applying this scenario to our 2023 guidance would result in net interest income levels that are still significantly higher than our previous record. Of course, there are many dynamics that may cause model results to differ from actual outcomes. At this time, we are not currently adding swaps, and we will monitor our balance sheet, sensitivity position, and market dynamics to assess opportunities to layer in additional forward hedges where appropriate. We believe improved predictability of earnings provides us the ability to invest in our business more consistently, thereby growing customers and revenue and providing a more compelling investment thesis for our shareholders. Our disciplined credit culture, diverse portfolio, and deep expertise continue to produce excellent results, as shown on slide 13. Fourth quarter net charge-offs relative to loans were the lowest of our peer group, and we were well reserved with the highest loan loss reserve to net charge-offs amongst our peers. We have continued to see some signs of credit normalization in select areas, particularly in our leverage book in Technology and Life Sciences business, which have a higher risk profile. Together, those portfolios total about $4 billion. However, our overall credit metrics across the portfolio remain very strong. With our consistent approach to credit across our businesses, we believe we are well positioned to manage through a recessionary environment. Bless you. Turning to expenses on slide 14. We continue to balance investments and other expenses with revenue growth, maintaining a solid efficiency ratio of 53% relative to our peers, who were at approximately 55% in the fourth quarter. As discussed on our earnings call, we do expect some expense pressures in 2023, with the largest being the increase in pension costs. However, we remain committed to prudent expense management and feel we have demonstrated this conservative approach over time. As an example, over the last 10 years, we have carefully managed staffing levels lower without sacrificing customer relationships or revenue, maintaining higher balances and revenue per employee than peers. By closely managing our resources, we believe we had the wherewithal to invest in our future, which is key to developing deep, loyal customer relationships and driving growth. Slide 15 provides details on capital management. As always, our priority is to use our capital to support our customers and drive growth while providing an attractive return to shareholders. We feel very good about our capital position. As of the fourth quarter, CET1 came right in at our target of 10%, and tangible common equity, excluding AOCI, compares very favorably to our peers at 9.3%. As a result of our strong profitability, capital position and growth potential, we were excited to announce a 4% increase in our quarterly dividend for common stock payable April 1st. We remain committed to providing a competitive dividend yield as part of the value proposition for our shareholders. Slide 16 highlights our superior financial performance relative to peers in 2022. Increasing rates and loan growth drove a 34% increase in net interest income, revenue growth of 19% and PPNR growth of 39%, all significantly outperforming peers. Credit quality remained excellent while we grew EPS and had a strong ROA. With the protection from our hedging program and momentum in our business, we believe we are poised to deliver a sustained high level of earnings through the rate cycle. We feel our relationship focus provides a competitive advantage, supporting customers with our industry expertise and tenured teams. Striking the balance between investing in the future and prudent expense management, we are prioritizing efficiency. Strategic management of our business, operations and balance sheet has resulted in a more agile company built on the foundation of prudent risk management. We feel we are uniquely positioned in our selected markets and businesses with the right products, people and investments to drive long-term success. Thank you. Now I'm happy to take questions. From me. Don or whoever. Anybody else. Anybody else. Anybody else. You can't ask questions, by the way. Managing the margin, I'm assuming that's what you're talking about in all of your meetings with investors. Margin is a very popular topic. Okay. More specifically, deposits and deposit betas are right there with it. Yeah, that's certainly in the front of investors' minds. Okay. I feel like we need to take a shot every time we say deposit beta. Let's see how the day goes. It's, it's every other comment is deposit beta. What's the toughest part of the margin management process for you? What's been the most difficult part of this to manage? You know, I think those aspects that we can control, we feel really good about, and we've done a good job. You know, we couldn't be more proud of the hedging program. You know, the things we can control or at least partially control, like, you know, loan spreads, which of course are subject to competitive pressures. We think we've done a good job on deposit pricing, you know, striking the right balance between retaining customers and not necessarily overpaying for certain types of accounts. We think we balance well. For me, the hardest part is predicting those aspects that we can't control. I would say DDA, you know, flows would probably be at the top of the list, not only because they're somewhat unpredictable because you have to read the minds of corporate treasurers, but it's also the most impactful. You know, loan spreads carry, whatever loan spreads they carry, likewise for interest-bearing deposits. In a 5.5% rate environment, DDA is obviously gonna cost you 5.5%-6%+, depending on what your wholesale funding costs are. DDA is what's causing me to spend, It's where I'm spending most of my attention in terms of analyzing it, and I feel it's something that's not totally in the control of bank CFOs and treasurers, but it is something we're monitoring very closely. Is it close to running its course, do you think, the DDA run-offs? We've seen the vast majority of it at this time. you know, we don't necessarily have a model to predict where it's going to end up because we haven't had this level of rates in such a long time, and we haven't come off such a high level of QE. I do think we've seen the vast majority of it go, but I don't think we're done either. I think it's got a little ways to go still. A lot of this comes down to how aggressively corporate treasurers wanna manage their DDAs, and what type of safety nets they want to maintain. We've certainly seen evidence they want to maintain a safety net following the COVID crisis, very similar to what I saw following, you know, the Great Recession. Mm-hmm. The higher the rates go, the more the corporate treasurers are willing to take a tighter look at it and manage it, you know, a little bit closer to the vest there. Okay. You gave us the update, appreciate that, last night. 3%-4% down, 9%-10% for the year. Stock's off a little bit. It's not fatal. Anything about that guidance, unexpected when you started the quarter? You know, not really. We, obviously had our guidance when we started the quarter. Yeah. Since then, we have seen the curve shift up a little bit. Yeah. I think that has caught the attention, again, of corporate treasurers. You know, even our models would say as the curve shifts up, you would expect to see some additional deposit outflows. I feel like there's a consistency there. You know, as I mentioned in the script, we do expect the higher curve to offset the deposit outflows, which is very consistent with our ALCO modeling, where we're close to interest neutral at this point in time. Yeah. I would say, given the way the environment's progressed, it wasn't real surprising. It wasn't a significant change either, but it's one we wanted to be transparent on and get in front of. Yeah. Okay. question on the longer term, the full-year net interest income guide to 17%-20%. It feels like you're fairly well hedged from a margin point of view. What drives you to the top end or the lower end of that range? Is it, is it loan growth, or is it something else? You know, everything has an impact. I'll harken back to the deposit comments. I do think the way deposits respond. I would put deposit DDA volumes at the top of the list, and I'd put overall deposit flows probably next down. Then loan volume, which of course can be very helpful, would probably take a step behind that in terms of being impactful. They all figure into the mix, obviously, in the end. Okay. Okay. Loan growth topic. You sense it's slowing, accelerating momentum from the fourth quarter. What would be your description of the loan growth environment? It's tracking very close to what we thought. Of course, we're not changing that forecast. You know, we reaffirmed the outlook, but nothing surprising whatsoever. We do feel like, especially being a commercial bank, we have some line of sight here because we have, you know, pipeline reports that we track very closely. Mm-hmm. As we talk to customers, they're still willing to borrow, even though interest rates are a little bit higher. You know, some talk of a hard landing. Customers seem to want to invest in their businesses. I would say there's nothing real surprising. You know, mortgage banker, of course, with higher rates, is struggling a little bit more than we might have thought. In middle market, we continue to be very strong, really in all of our markets, and in particular, Texas. In general, we're pretty pleased with the growth we're seeing across our business lines and the potential we see for this year. In the end, we may see some of the parts and components end up a little different than what we might have forecasted in the beginning of the year, some higher, some lower. Overall, we feel really good about the overall outlook we provided on loans and... The sentiment is still decent. I would say no change whatsoever. Okay. You know, customers are always looking at the economy just like we are. Even though they're relatively confident and willing to invest in their businesses now, you know, if we do take a step further down in terms of GDP or recession, outlook, you know, we could see that slow up, but we're just not seeing signs of it at this point in time. Interesting. Okay. Anything weakening or softening from a demand point of view? I would say only mortgage banking, as I mentioned, and I talked about a little bit higher rates. You know, an equally impactful variable is the housing supply. You know, one of the things we like about our mortgage banking model is we are more purchase as opposed to refinance, and I think refinancing is gonna really struggle over the next couple of years with the higher rates. We are more of a purchase shop, but the challenge there right now is that housing supply of existing houses especially, is very limited. It has improved a little bit in the last two or three months, so I like the trend line. It's held a little bit hostage to the supply chain challenges, just like our dealer floor plan is. We're seeing some improvement there. It's still well below normal levels, and we need for that to bounce back to really see that business come back. The other thing we see and sense in anecdotal conversations is you have an awful lot of homeowners out there that are in their existing homes with a 3.5% mortgage, and they just don't wanna move and give that mortgage up. That's putting a constraint on existing home supply. Yeah. Anybody have questions? I have plenty. One of the comments you made on expenses kind of made me more of a near-term question. Can you go through that again on the Ameriprise partnership and then what kind of a timing on the payoff to expect? You know, something we're very excited about, it's gonna allow us to take a huge step forward in terms of technology platforms we offer our customers. You know, this, you know, our broker-dealer on the retail side and wealth side has not been a real large component of our overall income stream. We see the potential to really get that accelerated with this better platform. There will be some conversion expenses and transition costs, and we are expecting that to be in the range of $10 million-$15 million for 2023. We think $8 million of that $10 million-$15 million will be realized in the first quarter. You know, some of that depends on contract notification and terminations of contracts and so on. That was not in our expense guidance that we offered in the January earnings call. However, this does become accretive pretty quickly. By the end of year two, we expect to have recovered that $10 million-$15 million. For the longer term, we couldn't be more excited about this partnership and, you know, we can't wait to get going on it. Okay. That's the only change on expenses? That's right. Okay. Okay. We have to talk about AOCI again and the buyback, but talk a little... I mean, I think we're gonna go back to the discussion we had at the end of the third quarter on AOCI. Talk a little bit about how that factors into some of your capital return plans and what you're thinking on buyback activity as well. Yeah. I still feel confident in saying it has no impact on our share buyback plans. You know, time is our friend when it comes to AOCI. You know, if rates hold steady, every quarter you accrete more of that AOCI back on the bond portfolio. Of course, we're a couple quarters away from when we last talked about it. Rates of course are a factor also. We feel really good about the fact that it's not something that the constituents that we care most about are concerned over. It doesn't affect our funding abilities. It will accrete back on the bond side eventually. Really having no impact whatsoever in terms of how we think about share buyback. Okay. Just the accretion that comes back in coming through capital, I understand that. You talked about a lot of the puts and takes in cash management in the bond portfolio as well. What is the message in terms of what you're doing from a cash and securities management point of view. Yeah. We have a bit of a diversified plan there, but we also have a priority order of how we, you know, manage our cash. First order of business is to the extent we have excess cash, we can use that to fund loan growth. I mentioned during my script that we have a fair amount of securities maturing this year, you know, $2.5 billion-$3 billion. That's gonna be a great source of liquidity for us. Then of course, we have a number of efficient lines, you know, everything from brokered deposits to FHLB, and even the capital markets are cooperating lately. We've seen credit spreads come back in. Overall, within that interest income, you know, it can be a little more expensive to issue a senior note. For a bank that has relatively low levels of wholesale funding like Comerica, it makes sense to introduce into the diversified funding stack. For a bank that has lower levels of wholesale debt, you do get a pretty significant break on FDIC expense when you issue senior debt. We plan on taking advantage, most likely of all those avenues in 2023 and feel like we have a lot of dry powder. Our loan-to-deposit ratio is indicative of the fact that we have a lot of dry powder. They're only 75%, well below our historical averages. We have a lot of diversified places to go to to fund the loan growth or deposit runoff should it continue. No concerns whatsoever in terms of funding the balance sheet. Okay. Six months ago when we started planning this, I didn't think that credit would be in the last minute and a half of the discussion. Anything to note on credit? What's most notable is that there's nothing to talk about really. you know, we see benign credit metrics. We're not seeing anything that concerns us. You know, we do think the canary in the coal mine will be the leverage portfolio. For us, that's relatively small. you know, we have about $3 billion of leverage loans in our middle market portfolio. By the way, you know, we don't target leverage loans. Sometimes our customers happen to get in a leverage position. TLS at about $1 billion is leveraged just due to the nature of that business or Technology and Life Sciences unit. So we're seeing some migration there, but nothing that's concerning at this point in time. I actually think the industry as a whole, and certainly Comerica, I feel confident, is gonna come through this cycle very strong. You know, I look at the various constituents of how banks are managing themselves, how regulators have a higher bar, rating agencies have a higher bar. What's maybe not talked about is customers are managing themselves more conservatively. You know, they remember COVID. Mm-hmm. I'm actually expecting the industry to outperform on credit. Certainly in the case of Comerica, I feel very confident in our ability to manage through a recessionary environment. Mm-hmm. Okay. Where do you think the bad debt does lie? If we do go through a recession, I mean, there are clearly people that'll be crunched. Where is that sitting? Yeah. I think the non-banks, you know, are probably the place you're gonna see the suffering occur. You know, we see a lot of leverage deals much higher than the regulatory definition of leverage occur with the non-banks. You know, my own personal preference is I'd love to see the regulators focus in that area a little bit more. You know, that's got the potential to have some contagion to the rest of the economy. You know, banks might not be totally immune to that. I think the banking sector itself is gonna be in really good shape overall. To summarize, decent loan growth. It's a great-. The dog hedge, reducing the amplitude of the volatility of the margin. Yeah. I'm really- Anything else to note? The one thing I would add, you know, Comerica has always been known as a very conservative manager. Yeah. Stellar on credit, you know, very conservative on liquidity and capital. You know, there aren't many banks around from the 1990s that we're in the top 25. We're one of the very few that continues to survive. I think what's notable is that we have more of a investment and growth mantra right now. Curt and his management team are doing a really good job of taking advantage of opportunities. I think we have the opportunity to get the best of both worlds. We're gonna continue with great risk management mindsets, but at the same time, we're making the investments in technology and markets and people and products. I think it is the best of both worlds and, you know, I've never been more excited about the company's prospects. Perfect. Thank you very much for being here. Okay. Thank you, John. Thank you, everyone.