July 17 - Standard & Poor’s Ratings Services today said its ratings and outlook on Comerica Inc. (A-/Stable/A-2) are not affected by the company’s second-quarter results, which we view as good. Net income rose to $144 million from $130 million in the first quarter, party as a result of lower noninterest expenses (in other words, fewer employees) and a low level of provisions for loan losses. Net interest margins declined materially in the quarter, and we expect them to weaken modestly in the second half of 2012 given increasing competition and the reinvestment of maturing securities at lower rates. Credit quality continued to improve, as the sequential decline in nonperforming loans demonstrates. We expect some further improvement in the near term given the sequential declines in internal watch list loans and loans 90 days or more past due. Loan balances and customer deposits rose again, and we think they could continue to climb through the rest of 2012 given that we expect the local economy to remain strong in Texas and improve gradually in Michigan. Capital ratios rose slightly from the previous quarter (the tangible common equity ratio rose to 10.27%) despite growth in loan balances. Our ratings reflect the company’s strengthening financial performance, and we are unlikely to raise the ratings given management’s strategy of returning earnings to shareholders through common dividends and share buybacks.