Darlene Persons - Director of Investor Relations Ralph Babb - Chairman and Chief Executive Officer Beth Acton – Chief Financial Officer John Killian - EVP and Chief Credit Officer Dale Greene - EVP of Business Bank

Ken Zerbe - Morgan Stanley Steven Alexopaulos – JP Morgan Brian Klock - KBW Brett Robison -- Stern Agee John Pancary -- Evercore Partners Terry McElvoy – Oppenheimer Gary Tennor – BA Davidson

Good morning, my name is Alicia and I will be your conference operator today. At this time I would like to welcome everyone to the Comerica’s third quarter 2010 earnings conference call. All lines have been placed on mute to prevent any background noise. After the speaker’s remarks there will be a question-and-answer session. (Operator Instructions). Thank you. I would now like to turn the call over to Miss Darlene Persons, please go ahead, Ma’am.

Thank you, Alicia. Good morning, and welcome to Comerica’s third quarter 2010 earnings conference call. Participating on this call will be our Chairman Ralph Babb; our Chief Financial Officer, Beth Acton; our Chief Credit Officer, John Killian; and Dale Greene, Executive Vice President of the Business Bank. A copy of our press release and presentation slides are available on the SEC’s website, as well as on the investor relations section of our website. Before we get started, I would like to remind you that this conference call contains forward-looking statements, and in that regard, you should be mindful of the risks and uncertainties that can cause future results to vary from expectations. Forward-looking statements state only as of the date of this presentation and we undertake no obligation to update any forward-looking statements. I refer you to the Safe Harbor Statement contained in the release issued today, as well as slide two of this presentation which I incorporate into this call as well as our filings with the SEC. Also, this conference call will reference non-GAAP measures, in that regard, I will direct you to the reconciliation of these measures within this presentation. Now, I’ll turn the call over to Ralph.

Good morning. Today we reported Q3 net income of $59 million or $0.33 per share. Q3 total revenue was down 4% from the second quarter, primarily driven by a decrease in average loans, and lower fee income from customer activities. In this sluggish and still uncertain economic environment, our customers have remained understandably cautious. This is reflected in the weak loan demand and continued strong core deposit levels. Our solid capital and liquidity position enabled us to fully redeem our trust preferred securities on October 1, which will reduce interest expense. This uniquely positions us as the only bank in our peer group to have redeemed TARP and eliminated trust-preferred securities. Our Q3 financial results reflected the continued improvement in credit quality and careful control of expenses. Our skill based relationship driven strategy and our prudent conservative approach to banking continued to serve us well. We believe we have a business model that cannot be replicated overnight. It takes years of experience and expertise to understand the credit cycle, small businesses, middle market companies and their owners, managers, and employees, for whom we provide personal financial services. Relationships mean more than ever in this type of environment. While unemployment remains stubbornly high, there are some signals the economy is improving, albeit slowly. Economic factors which support loan growth, such as business fixed investment and inventories, continue to improve. The Commerce Department recently indicated that investments in computers, communications equipment, and machinery, for example, helped spur capital goods orders in August, which is a good sign. Here in Texas, which continues to outperform the national economy, we are establishing good, full service relationships with solid companies as long term calling by relationship managers and executive management is paying off. In California, a state whose economy is holding steady, according to our chief economist’s latest economic activity index, we are seeing more opportunities in middle market and small business banking, in addition to technology and life sciences. In Michigan, a rebound in manufacturing is helping that state, and the national economy emerge from the recession. US light vehicle sales are headed in the right direction this year. We are seeing more encouraging and hopeful signs throughout our footprint. The pace of decline in loan outstandings continued to slow in Q3. Commercial loans increased modestly in Q3, and total loans increased in the month of September. Our loan pipeline continued its strong growth as evidenced by the commitments issued, but not yet closed, which increased nearly 50% from Q2. Line utilization increased almost 1% to about 46% at September 30th , after remaining at about 45% since the middle of Q1. We had loan growth in Q3 in mortgage banker finance, national dealer services, and energy lending business lines. Commercial real estate accounted for about half of the decline in average loan outstandings in Q3, as expected. After six straight quarters of growth, the average deposit levels were relatively stable compared to Q2. The continued improvement in credit quality is reflected by the decline in net charge offs for the fifth consecutive quarter, as well as the $10 million decline in the provision for credit losses, compared to Q2. The increase in inflows to non-accrual loans was primarily related to commercial real estate, which we believe will continue to exhibit variability, with a downward trend. Overall, credit migration has improved, as evidenced by the $480 million decline in the watch list, which is our best early indicator of future credit quality. Our own recognition of credit issues, and our ability to quickly and proactively work through them remains one of our key strengths. In light of the struggle and uncertain economic environment, we expect Q4 net charge-offs to be similar to Q3. Based on year to date positive trends as well as our expectations for Q4, our full year net charge offs are expected to be lower than our prior outlook. The net interest margin decreased five basis point, to 3.23%, resulting from a variety of factors which Beth will discuss shortly. We do expect our net interest margin to improve in Q4, from Q3 levels. Our expenses remain well controlled. Non-interest expenses were relatively stable, compared to Q2. Our capital ratios remain strong. The tangible common equity ratio increased 28 basis points, to 10.39% at September 30th , and the estimated tier one common ratio increased 16 basis points to 9.97% at September 30th, from June 30th . We will be closely following the development of the new Basal (sp) standards. Comerica has maintained a very strong capital base for a long time, and we expect we will comfortably be able to meet the proposed capital requirements. With respect to financial reform, our analysis has not changed. Overall we believe that the direct adverse impacts of financial reform will felt less by Comerica than by many other major banks, due to the nature of our business. In closing, we have remained focused on executing our relationship banking strategy, and delivering outstanding customer service throughout this economic cycle. Positive trends and credit quality have continued, and we have strong capital and liquidity to grow organically or by acquisition. And now I’ll turn the call over to Beth and John, who will discuss our Q3 results in more detail.

Thank you, Ralph. As I review our Q3 results, I will be referring to the slides we have prepared, that provide additional details on our earnings. Turning to slide three, we outline the major components of our Q3 2010 results. Compared to the prior period, and the same period a year ago. Today, we reported Q3 2010 net income of $59 million, and diluted earnings per share of $0.33. Slide four provides highlights of the financial results for Q3, compared to Q2. Credit quality continued to improve. Net credit related charge offs decreased by $14 million from Q2, to $132 million. The provision for credit losses was $116 million, $10 million less than Q2. Also, the watch list declined by $480 million. The pace of decline in loans continued to slow in Q3. Average loans declined $470 million, compared to declines of $641 million in Q2 and $1.4 billion in Q1. Average deposit levels remain strong, decreasing only 1% from Q2. Growth in business deposits was offset by reduced personal and private banking deposits. The net interest margin in Q3 was 3.23%. Excluding the impact of excess liquidity, the net interest margin would have been 3.2%. We continue to carefully control expenses, with non-interest expenses relatively stable. Our capital position remains strong, as evidenced by our tangible common equity ratio of 10.39%. As I just mentioned, the pace at which average loans declined continues to slow, as shown on slide five. Average loans declined $570 million in Q3, and in the last month of the quarter, average loans increased $145 million. We are hoping that we have started to turn the corner on loan outstandings. Average commercial loans were up $57 million over last quarter. On a period end basis, commercial loans increased $281 million from June 30 to September 3. As commercial loan growth returns, we expect it will be muted by declines in commercial real estate loans. In fact, about half of the decline in average outstandings in Q3 were in commercial real estate. Turning to slide six, our loan portfolio is well diversified among many lines of business and geography. In Q3, average loan outstandings increased in mortgage banker, national dealer services, and energy. Decreased average outstandings in Q3 were noted in a number of areas, with the largest decline in (inaudible 0:16:19) market, commercial real estate, and global corporate banking. Line utilization for the portfolio as a whole increased almost 1%, to about 46%, after remaining about 45% since the middle of Q1. While loan demand remains weak, as our customers are understandably cautious, given the sluggish and uncertain economy, we are hopeful as our loan pipelines continue to grow. This includes commitments issued, but not yet closed, which increased almost 50% in Q3, to $871 million. As shown on slide seven, core deposits remain strong in Q3. Average core deposits decreased a modest $142 million, after six consecutive quarters of growth. A $327 million increase in money market and NOW deposits was offset by a $298 million decrease in non-interest bearing deposits, and $119 million decline in customer CDs. Overall, deposit growth in commercial segments was offset by reduced personal and private banking deposits. We had growth in several business segments, led by middle market, energy, and small business, partially offset by a decrease in global corporate banking. Deposits declined in private banking, as customers generally shifted into money market accounts at Comerica Securities. A smaller decrease was noted in personal banking, where in the Midwest, over half the decrease related to maturities of higher priced CDs. As outline on slide eight, the net interest margin of 3.23% decreased five basis points compared to Q2, for several reasons. First of all, we had lower loan yields in the quarter. This was primarily a result of the lower fees in the margin. When a loan is pre-paid, there is accelerated recognition of deferred loan fees. Due to the slower pace of loan pre-payments in Q3, relative to the first half of the year, loan fees declined. The reduction of (inaudible 0:18:27) rates in the quarter also had a minor impact on loan yields. As a reminder, about 70% of our loans are floating rates, with about 70% (inaudible 0:18:36) based. Additionally, the increase in the impact from non-accrual loans and maturing interest rate swaps had a small negative impact on loan yields. Of note, we have not seen any major loan spread compression, only selectively for larger, better rated corporations. Second, the yield on the securities portfolio was lower in the quarter. Mortgage rates fell significantly in Q3, resulting in accelerated pre-payments of mortgage backed securities throughout the quarter, particularly in September. In fact, pre-payments were more than twice as high in September as they were in June. When pre-payments occur, there is an acceleration of the original purchase premium, which is being amortized over the security’s expected life. Finally, the impact from the reduction in excess liquidity partially offset the decline in the yields of loans and securities. Excess liquidity was represented by an average of $3 billion deposited with the Federal Reserve in Q3. This was a $736 million decline from Q2, and declined less than we had anticipated due to continued weak loan demand, and strong deposit levels. The excess liquidity position of September 30 was $3 billion. We are proactively managing our excess liquidity as evidenced by the pre-payment without penalty of $2 billion in Federal Home Loan Bank advances in late August, as well as fully redeeming $500 million in trust-preferred securities at TARP, on October 1st. This excess liquidity is above and beyond the investment securities portfolio, which will continue to provide a reservoir of liquidity. Turning to slide nine, non-interest expenses remain well controlled in Q3. Credit related costs declined, and with a $6 million decrease in the provision for living related commitments, partially offset by $2 million for increase in ROE expense. Our largest expense item is salaries, and therefore management of staff levels is key. We have consistently reduced our work force over the past several years. Our workforce decreased by approximately 3% from year ago levels. Compared to 2001, we have 20% fewer people today, while our assets are 10% larger. Salaries expense was higher in the quarter, as a result of the impact of one additional day in Q3, and included an increase in share based compensation expense, of $6 million, related to stock brands in the quarter. Now John Killian, our chief credit officer, will discuss credit quality, starting on slide ten.

Good morning. In Q3 we saw continued improvement in our credit quality. Net charge offs, the provision for credit losses, and the watch list improved from Q2 levels. Q3 marked the fifth consecutive quarter of decline in net charge offs. Net credit related charge offs decreased $14 million to $132 million. Provision for credit losses, which includes loans as well as all balance sheet commitments, was $116 million. This was $10 million less than Q2, primarily due to declines in the middle market, energy, and entertainment business lines, partially offset by an increase in the private banking and commercial real estate business lines. The provision was less than charge-offs, for the second consecutive quarter, reflecting our overall credit performance, including improving migration trends for both loans, as well as off balance sheet commitments. The allowance for loan losses was 2.38% of total loans, and 80% of total non-performing loans. Slide 11 provides detail on net charge offs, which decreased $14 million, to $132 million in Q3. The decrease in net credit related charge offs resulted primarily from a $39 million decrease in the middle market, partially offset by a $24 million increase in the commercial real estate business line, primarily in the western and mid west markets. On slide 12, we provide information on the inflow to non-accrual loans. During Q3, $294 million of loan relationships greater than $2 million were transferred to non-accrual status. Of these inflows, $132 million were from the commercial real estate business line, with almost three-quarters coming from the western market, $91 million were from the middle market business line, primarily in the mid west market, and $28 million were from energy lending in the Texas market. Based on our analysis of the default breaks, risk rating migration patterns and watch list results, the increase to non-accruals is caused by previously identified problem credits, moving along the normal route of the collection process. We believe we will continue to see a downward trend in the inflows to non-accrual, with some variability quarter to quarter, particularly in commercial real estate. Turning to slide 13, total non-accrual loans increased $65 million, to $1.2 billion. The largest portion of the non-accrual loans continues to be the commercial real estate line of business, which remain stable at $528 million in the quarter. Net accruals increased in middle market by $41 million, private banking and global corporate banking non-accruals declined. By geography, the decrease in non-accrual loans in the Midwest was offset by increases in western and Texas. Total TDRs increased from $99 million into $147 million in Q3. Of the total TDRs, $50 million were accruing, $28 million were reduced rate, and $69 million were non-accrual. We sold $12 million of non-performing loans in the quarter, as well as $7 million in performing loans. Additionally, we completed $42 million in short sells, of which $13 million were non-performing loans, whereby we settle a note with the borrower at less than PAR. In total, prices approximated our carrying value plus reserves. This continues to support our analysis of valuations. We review work out strategies, reserves and carrying values for each individual non-performing loan at least quarterly. This pro-active strategy has contributed to the decline in net charge offs, as well as an average carrying value of our non-accrual loans of 55%, compared to contractual values. On slide 14, we have our watch list loans, which decreased by $480 million, to $6.2 billion at the end of Q3. The watch list is primarily comprised of special mention, sub-standard, and non-accrual loans. The watch list is the best early indicator we have of future credit quality. This is the fourth consecutive quarter of decline, and reflects a significant decline in special interest loans. Declines in the watch list were evidenced in all geographic markets and across virtually all lines of business, particularly in middle market and in commercial real estate. Loans past due 90 days or more and still accruing totals $104 million, an $11 million decrease from last quarter. Foreclosed property increased $27 million, to $120 million, yet remains relatively small. Shared national credit, or SNIC, exam results were released in August. The results were consistent with the credit outlook we had given in July, and overall were not a factor in our Q3 results. On slide 15, we provide a detailed breakdown by geography and project type of our commercial real estate line of business, which declined $202 million on a period end basis, from the end of Q2. There is further detail provided in the appendix to these slides. Total outstandings of $4.1 billion were down $892 million from a year ago. This included a $513 million western market and $137 million decline in Michigan. Slide 16 provides net charge offs for our commercial real estate line of business by project type and geography. Net charge offs for commercial real estate was $60 million in Q3, and were consistent with our expectation for continued improvement with some variability from quarter to quarter. Values have stabilized, and even improved in certain locations. The largest portion of charge offs were noted in residential properties, and in the western market. In flows to non-accruals greater than $2 million increased from a very low level in Q2. Total non-accruals were stable, and watch list loans decreased in Q3. We believe these trends are consistent with what we would expect in the normal course of working through problem loans. There are additional slides in the appendix, which provide further detail on certain segments. The consumer portfolio, representing approximately 10% of our total loans, continues to perform relatively well. Included in our consumer portfolio is only $1.6 billion in residential mortgages, and $1.7 billion in home equity loans. Given the size and makeup of the portfolio, we would expect any impact from the current industry foreclosure issues to be minimal. Slide detail in our auto dealer and automotive supplier portfolio also can be found in the appendix. We continue to have excellent credit quality in both of those portfolios. To conclude on credit, we are pleased with the continued improvement in credit quality, including improving migration trends. In light of the sluggish and uncertain economic environment, we expect Q4 net credit related charge offs to be similar to Q3. We expect a provision for credit losses in Q4 will continue to be less than net charge offs. Based on our year to date positive trends, and our expectations for Q4, full year net charge offs are expected to be lower than our higher outlook. Now I’ll turn the call back to Beth.

Thanks, John. Turning to slide 17, our capital position is strong, and historically we have some of the highest capital ratios in our peer group. We’ve totally redeemed our trust preferred securities at PAR, on October 1st. This uniquely positions us as the only bank in our peer group to have redeemed TARP as well as eliminated trust preferred from its capital structure. Elimination of these higher cost securities will result in significant interest savings for us. Slide 18 outlines our summary analysis of the latest Basal proposal, as applied to Comerica. On the capital side, our assessments based on currently available information, is at the expected impact from changes in the components of capital in the calculation of risk rated assets would not be material. In fact, we believe we already meet the proposed capital ratio requirements. On the liquidity side, there’s a high degree of uncertainty regarding implementation and interpretation of the rules. We’ll be closely following the development of these new standards. We believe that the potential changes are manageable, given our proven ability to administer our balance sheet. Included in the appendix is a slide detailing the impact Dodd-Frank Act. Essentially, our analysis has not changed. We’ve always believed that the direct adverse impacts of financial reform will be felt less by Comerica than many other major banks, due to the nature of our business. Slide 19 provides our outlook for Q4. Average earning assets of approximately $48 billion, largely reflecting a decline in average excess liquidity from $3 billion in Q3, to about $1 billion in Q4. We expect that average excess liquidity will decline in Q4, primarily due to debt maturity, and redemption of the trust preferred, and the full quarter effect of the $2 billion pre-payment of the Federal Home Loan Bank advances in late August. We expect the net interest margin to be between 330 and 335, primarily based on a decline in excess liquidity to $1 billion and assuming pre-payments in the investment securities portfolio remaining at the same high level we experienced in September. Our outlook for Q4 net credit related charge offs is that they will be similar to Q3. The provision for credit losses is expected to be below net credit related charge offs. We expect a low single digit decline in non-interest income, compared to Q3. This includes the impact of Reg-E, and based on the current trends, we continue to anticipate a reduction in fee income of approximately $3 million in Q4. As far as non-interest expenses, we expect a low single digit increase compared to Q3. As previously announced, Q4 will include a $5 million negative impact from the accelerated accretient of the remaining original issue of discount, related to the redemption of the trust securing securities. Overall, we saw a positive trend continue in Q3, such as improved credit quality, a slower pace of decline in loan demands, as well as drawing deposit and capital levels. We believe that our relationship approach has served us well, throughout this cycle, economic cycle, and will assist us in attracting new business, and growing existing relationships as the economy improves. Now we would be happy to answer any questions you have.

: Ken Zerbe - Morgan Stanley: Good morning, guys. First question, just in terms of the non-performance, there’s more specifically the increase in commercial real estate non-performing assets, it all sounded like from your comments that you anticipated this increase, given the trends you saw in the underlying – in the credits going into the quarter. Problem I think – my suspicion is though, out on the street is not that you were necessarily anticipating that. When you look at your portfolio going forward, do you anticipate any other items or material changes, one way or the other? Whether it’s in commercial real estate or otherwise?

Ken, I didn’t actually anticipate that going in to Q3, you know, we still had had four or five quarters in a row of improving credit metrics. As you saw in Q3 again, that charge off provision, past dues, and most importantly the watch list, improved. But we did see the increase in commercial real estate NPA inflow, and therefore the increase in total NPA, and we have consistently said, over the past several quarters there could be some variability in these, any one of these numbers, or two of these numbers, as we go forward in this kind of economic uncertainty. The story on the CRE inflow was really a very familiar story for us, the main part of the increase in MPA inflow was due to single family, (inaudible 0:34:57) and retail, again showing some distress, as we have frankly had for a couple of quarters in a row. But everything we have analyzed, Ken, from migration patterns to the watch list itself leads us to believe that these are all previously identified problem credits moving through the normal collection route, and not a new wave of problems. Overall, we still expect credit metrics to continue to improve with some variability from quarter to quarter, as we’ve seen in this quarter. Particularly in the commercial real estate sector, which as you know, is still struggling in this economic environment. So there’s still a lot of work to do. Ken Zerbe - Morgan Stanley: Okay, it was probably the comment that they were previously identified and then they (inaudible 0:35:41) that kind of threw me there. The other thing I had a question on, in terms of the non-interest bearing deposits, it looks like this was the first quarter where we saw the decline. What is the driver for the roughly $300 decline in non-interest bearing? Are you seeing a change in corporate behavior? Is there some unusual items in there that led to the drop?

You know, Ken, this is Beth, the –I think we were not surprised that we saw some decline in non-interest bearing, because it’s been so high and grown so much, for six consecutive quarters, and actually in DDA today, in Q3 we are 13% higher than we were a year ago. So non-interest bearing levels continue to be high, but they’re some opportunities for companies to use it in their businesses, use the cash in their businesses, hopefully as investment picks up. And as we mentioned, related to private banking, we did have some deposits move over to Comerica Securities, our brokerage unit, into some money market accounts. So it’s a variety of reasons, but none unexpected. Ken Zerbe - Morgan Stanley: Okay, thank you.

Your next question comes from the line of Steven Alexopaulos of JP Morgan.

Good morning, Steve. Steven Alexopaulos – JPMorgan: Good morning everyone. Maybe I could start with the net interest margin. It seemed like the positive guidance for the margin in Q4 is related to the reduction in excess liquidity. Do you actually expect any net interest income growth in Q4?

If you look at the guidance we gave, what we said was ‘earning assets’, so you think about net interest income as two pieces, right? One is earning assets, the other is the margin. We did indicate in our outlook that the margin would be up, between 330 and 335, up from 323, but the earning assets would be down, $2 billion from the average in Q3 largely because, as you mentioned, the decline in excess liquidity from $3 billion to $1 billion. So those are the pieces of the outlook that we gave and our perspective on what the quarter would shape up to be. Steven Alexopaulos - JPMorgan: Okay, Beth, so if we look at the reduction this quarter and the yield, the interest income on the available for sales securities, which was down I guess $5 million of interest income and 14 basis points, based on your commentary, that pre-pay fees would stay very high, should that fall by another 14 basis points in Q4?

What I would say there is when you look at the Q4 outlook we gave, we indicated, as I mentioned earlier, that excess liquidity would decline by $2 billion. That’s anywhere from about 12 basis point improvement in the margin. There are some, based on the numbers we have given you on the impact of excess liquidity on the margin, there will be some, out outlook for the margin is not quite as high as that in terms of an increase in Q4, so we will continue to see two things as partial offsets to the excess liquidity going away. One is the impact you just mentioned, high pre-payments we’re assuming will continue, and will be reinvesting at lower yields, and that will have a minor but probably a larger impact than Q3, and second, we have maturing interest rate swaps which are maturing at positive spreads, so those will be going away, another $200 million in the $700 million matured in Q3, $200 million in Q4. So the positive, very positive impact from excess liquidity will be diminished a little by those two aspects as well. Steven Alexopaulos - JPMorgan: Maybe I could shift to loan growth for a second. It seems like the C & I balance has benefited, to a degree, from mortgage related lending. Can you talk about what you saw from your more traditional commercial borrowers during the quarter? Any signs of lines being drawn down, or any increased optimism?

Yeah, this is Dale. Number one, as we indicated, the usage was up a bit from about 45% to about 46%, it’s good to see that. We haven’t seen that in a while. If you look at the backlogs and you look at the growth from new customers, and increases to existing customers, it’s kind of spread across most of our businesses. Currently the dealer business is showing growth. The energy business has indicated they are showing growth, those backlogs continue to look good, and what we call the commitments to commit, or the approved deals that we’re waiting to close are up rather substantially this quarter over last quarter, and again, that’s generally across most of the segments. Middle market, technology and life sciences, and so forth. So the quality of the backlog, if you will, is good in the sense that there are more deals that have been approved that are waiting to close, and the level of activity is generally a little better than it’s been. So I would say that we are cautiously optimistic, but you know, this is an uncertain time. So while we’re seeing some improvements, and we’re happy to see it, we’re happy to see better usage, there’s still an economy here that most business people will tell you is concerning, troubling, uncertain. Steven Alexopaulos - JPMorgan: Okay, thanks, Dale. Maybe just finally, on capital. Are you guys permitted to buy back stock? Maybe you could share your thoughts on buy back versus dividend increase, particularly with the payout ratio at only 15%?

As we’ve talked about before, this is Ralph, we continue to watch the economic environment that Dale just described and we talked about earlier, as well as our core profitability trends, and we are generating capital in excess of our balance sheet growth, but there is still a fair amount of uncertainty out there. We’ll continue to monitor that, and as you mentioned, both the dividend and stock buybacks are important tools in making sure that we are where we want to be from a capital standpoint, and the appropriate time to return to our shareholder. Steven Alexopaulos - JPMorgan: Ralph, given that you’ve reached a TARP, could you buy back stock if you wanted to?

Well, I think we evaluate that accordingly and would have discussions with the appropriate, obviously the Board and appropriate regulators before we undertook to do anything like that. But again, the uncertainty that’s out there is another thing that we have to watch at the moment. We feel very comfortable with our capital, as you mentioned, we’re very strong, as Beth was talking about earlier, and I think positioned very well, and while cautious, things are moving in the right direction, but the key is will it continue to accelerate in the economy?

And on the buyback, Steve, you know we’re still, we’ll be waiting for how Basal three will get promulgated into US rules, so that we have our clarity related to us. We’re not a Basal two bank, so it will be very important to see the US regulators turn Basal three into some proposed rule making that we can evaluate in the context of share repurchase program. Steven Alexopaulos - JPMorgan: Okay, thanks.

Thank you.

Your next question comes from the line of Brian Klock, of KBW. Brian Klock – KBW: Good morning, everyone. And I guess I may be expanding on the capital management. You do have a significant amount of capital with tier one, the common ratio is significantly higher than a lot of your peers. So I’m thinking that if there’s not a significant impact or change to your risk (inaudible 0:43:44) because already they’re largely commercial focused, and you know, Basal three has been put in place, so it seems that maybe you guys could be put in a situation where again, you have a low payoff ratio that -- probably enough, I guess if there was something you need to wait until after the G20 meeting here in November to get more clarity on deciding what to do with capital deployment. You already talked about dividend and buyback, I guess maybe, Ralph, if you can talk about the acquisition opportunities that you can to deploy all the excess capital.

Well, I think to your first point, that certainly is watching to see what happens in the Basal and capital is requirements that Beth was talking about earlier. It is important, one of the important aspects of looking to see where we are and where we go in the future. Acquisitions, as I mentioned earlier, we certainly have the capital for internal growth, as well as acquisitions, and as we said in the past, we’re always looking for opportunities, especially in Texas and California, to increase our presence here. We’re looking for acquisitions from the standpoint of, really to join us, to pick up not only an institution, but also the people in that institution, so we can grow in those markets. Given all the change and things that are going on today in the current environment in the financial institutions area, it’s my personal belief that there will be some opportunities there. Whether they will fit us from a price and culture standpoint and location standpoint, you never know until it presents itself. Brian Klock - KBW: Okay, and I guess maybe from John or Dale, maybe you guys can comment on – and I apologize if you did go into this in a little bit of detail if I missed it, but the inflows into non-performing, you mentioned that a good portion of that was related to Western commercial real estate. Is there any sort of particular market within California that you’re seeing the weakness in that commercial real estate line of business? In your Western footprint?

No, there’s no concentration, Brian, in the Western market. It really is spread throughout the state, and as you know, location is everything in real estate. So it really is quite dependent. But again, it was mostly resi and mostly some weakness in retail. Oddly enough, multi-family, which some institutions seem to be having some trouble with, we had very little difficulty. In fact, in many locations, multi-family is, dare I say, hot these days in the marketplace. So no concentration to answer your question. Brian Klock - KBW: Again, more the residential, it’s still the same softness in residential?

Yes, very familiar story. Primarily residential, but some distress in retail as well, Although we believe, even in the Western market, that that market is overall stable, and has bottomed in terms of vacancies and lease rates. Unfortunately, both of those are at levels that are lower than we would like them to be. Brian Klock - KBW: Okay, and I guess you see, is there any impact of a portfolio moratorium? The market is just taking longer to get to a bottom with the residential real estate? Is that a contributing factor?

No, not really. Our consumer portfolio is about 10% of our portfolio. We’ve got 1.6 in residential mortgages and just to remind you, most of those are mortgages to our private lending clients, so that portfolio has performed extremely well with charge off and non-accrual and past due rates that are well below the marketplace. Now, we do outsource the servicing of that portfolio, and to the extent that that outsourcing could be caught up in a temporary moratorium, we could be wrapped up in that, but that could cause a small increase in MPAs, is how we would look at that, but it’s really minimal overall, and in the scope of the bank. Brian Klock – KBW: Yeah, and it seems like that’s a lower risk. Maybe just the residential construction and development, those properties may be taking just a little longer to clear because of all this mess, is what I’m thinking.

Yeah, we’re not seeing any problems with moving ahead with – whether it be foreclosure or whatever needs to be done in the collection process on the commercial side. Brian Klock - KBW: Okay, thanks for taking my questions.

Yes, Brian. Thank you.

Your next question comes from the line of Brett Robison (sp) of Stern Agee (sp).

Good morning, Brett. Brett Robison -- Stern Agee: I wanted to ask first off, I think Beth mentioned that you’ve not really seen much in the way of spread compression on the loan portfolio, so I was curious if you expect any, as competition continues to heat up in this lower environment.

Yeah, this is Dale. You know, the environment clearly has become more competitive. As we’ve indicated, haven’t seen any significant spread compression at this point. Clearly for some of the larger corporate high quality deals, there is certainly more compression there, but frankly, in our core sweet spot of middle market and small business, I wouldn’t mind, even to believe it’s not competitive, but that we’re not seeing any significant spread compression there at all. Clearly, the competition in terms of the structural elements, it continues to be challenging, but so far, we’ve been able to achieve our returns and the level of credit quality that we want, but it is clearly more competitive. Brett Robison -- Stern Agee: Okay, and then second, I wanted to ask – you’ve essentially been able to manage expenses flat this year, and I know you don’t get guidance on 2011 yet, but was curious if you might have initiatives next hear that might continue to be favorable toward your relative efficiency ratio.

You know, if you look at, we manage expenses literally on a monthly basis, as part of our monthly forecast process, and we’re looking at next year as well, clearly. A key element is obviously controlling people, and as we mentioned earlier, we have done I think a really good job over a long period of time of managing people. As I mentioned in the script, just to repeat it, that we’re operating today with 20% fewer people and our bank is 10% bigger in terms of assets. So the productivity, if you look at assets per employee, average assets per employee it’s almost 40% improvement. So we will continue to be focused on finding ways, not protecting the revenue base, the revenue producers, but finding ways to continue to do things more efficiently than we have in the past. Those jobs that we’ve taken out for that efficiency won’t come back, so the management of people is a big part of our expense base, we’re always looking at ways to do things more effectively, so it’s not something we do as part of a big program that we announce, it’s a two year program with a fancy name, this is literally part of a monthly process and even the management of people, to the extent they are different from what had been approved at budget levels, it has to come to the management policy committee to get approval. It’s meant to be bureaucratic and it is, because it really means that people are serious about needing that headcount, they’re going to come and ask the very senior people. So I think we have a very good process. I can give more color on kind of the dynamics for next year, in January, but be assured, it’s a big focus for the management team. Brett Robison -- Stern Agee: Okay, thanks for the color.

Thank you.

Your next question comes from the line of John Pancary of Evercore Partners.

Good morning, John. John Pancary – Evercore Partners: Morning. Beth, on that same line around expenses, can you talk a little bit about how you manage the control around employee comp expense and headcount with the opportunities to hire and take advantage of some of the disruption? Particularly in some of your growth markets in Texas?

Yeah, actually we have – when I talked about the head count levels, that doesn’t mean we aren’t hiring people, and we are hiring people whether it’s in California, whether it’s in Texas, whether it’s as part of the new wealth management retail combination, all of those things continue to go on, and we continue to find attractive opportunities to hire people. Senior people as well as more day to day revenue producers. So we are finding, given that our issues, that Comerica has weathered the storm very well in the last two years, that we’re out of TARP, that we’re in a capital position that allows us to support growth going forward, I think we have a very good story in recruiting people, and we continue to do that, selectively, but managing the overall head count in the context of it.

We are not passing up the opportunities that you referred to. In fact, we’ve attracted some very talented and good new people. John Pancary – Evercore Partners: Okay, and then you know, barring the trust redemption costs and just looking forward here over the next several quarters, can you give us an idea of where you would expect to be, your operating efficiency to fallout ad, obviously, but just trying to get an idea in terms of where your efficiency could run and if we could expect some positive operating leverage here in the next several quarters.

You know, for us, we don’t target an efficiency ratio, particularly. Over the last few years, we’ve added banking centers over the last few years, which kind of changed the historical business bank to a more exclusive focus, and so the efficiency ratio is one we certainly evaluate and measure, but we’re really focused on how we look at the relationship between an expense growth and revenue growth. And that’s why, over the last couple of years, given revenue has been quite challenging, that we have been very focused on controlling expenses, even more so. So I think it’s the relative relationship between how we look at revenue trends related to expense trends, and making sure those are properly balanced. So that’s how we would look at it. John Pancary – Evercore Partners: Okay, all right, and then quickly, on credit. Do you have the amount of the 30 to 89 day past dues, and how they’re trended?

Yes, John. We’re actually up a little bit in Q3 from Q2. In Q2, they were about $350 million, in Q3 they were about $400 million. So a very modest increase in light of the whole portfolio. John Pancary – Evercore Partners: Okay, and I’m sorry if you already commented on this, but in terms of how you are thinking about the reserve, given the decline, the watch list, and your expectation for a general downward trending in non-performers, I know you indicated that you expect to under provide for charge offs in coming quarters, but does that imply just keeping the reserves stable for the time being? Or when can you predict some of the release?

You know, John, it’s a very rigorous process that we use for determining the reserve. and therefore the provision, so it really is very difficult , if not impossible, to predict on an absolute basis. Given the trends that you mentioned in the overall metrics, we’re comfortable with our guidance, but there’s still an awful lot of work to do, and frankly, in a low growth economy. So in the final analysis, we’re going to need to see continued improvement metrics and hopefully some more expansive GDP growth, and job creation as we go forward. Along those lines.

But we have – just to remind you, in Q2 we did provide $20 million less in charge offs, and in Q3, we provided $16 million less in charge offs, so how that trend continues, or expands, we’ll have to see, to John’s point. But we have been modestly reducing reserves the last couple of quarters. And we think, cautiously so, and prudently so in light of the kind of, still, uncertainty that exists in the economic environment. John Pancary – Evercore Partners: Okay, and my last question, and I’m sorry if you may have already touched on this on in the first two questions, but in terms – I know you talked about utilization rate and everything in terms of demand firming up with commercial lending, but just trying to get an idea of how soon we can actually see the growth in commercial offset the CRE roll off, in terms of absolute normal?

I hope soon, but the reality is that number one, in terms of new CRE types of opportunities, there are very few new opportunities, so we’ll continue to see the run off of the commercial real estate book as part of a design, if you will. Clearly, as we talked about before, is I had one against growth. While we are seeing some positive trends in the non-CRE, the rest of the C & I book – it’s still very difficult to predict, because there’s just that uncertainty, and so I wouldn’t sit here and tell you exactly when you might see it. It might be a while. I mean, John talked about unemployment rates, and the growth and the economy still being on very muted labels. I don’t know that that’s going to change anytime in the near term, therefore, what we’re doing is the things we’ve done for years. We’re calling on customers, we’re calling on prospects, we’re looking for the core middle market opportunities, particularly in Texas and California. We have loads of good opportunities, we have a better quality backlog, but it will take some time, I think, to see any significant growth, if you will, in the C & I book. It’s just going to be sort of ongoing, quarter to quarter, a block and a tackle kind of an effort.

As Dale was mentioning, we’re staying very close to our customers, and what we’re hearing from our customers, and we have a lot of customers who are doing very well. They are not, because of the uncertainty in the economy, and other things that affect their particular business, investing for the future. They’re really taking care of what’s happening today, and until there is a confidence factor build out there along with the economy showing a steady improvement, I don’t think you’re going to see loans consistently pick up in the industry. You monitor the numbers, I’m sure, just like we do, as to how the industry in total is working. We saw a little bit of that in Q1 and Q2, where things began to pick up, and then all of a sudden the economy slowed back down again, and the estimates that I’ve heard and look at, over the next couple of quarters and into next year, are not significant in pickup. I hope that that’s not correct. John Pancary – Evercore Partners: Okay, thank you. Thanks for taking all the questions.

Sure. Thank you.

Your next question comes from the line of Terry McElvoy (sp) of Oppenheimer.

Morning Terry. Terry McElvoy – Oppenheimer: Good morning, thanks. On the call, the last call in July, you said that the NPA levels would be sticky, but heading lower on a gradual basis. I think we saw the stickiness in Q3, would that continue to be your feel, looking out into Q4 and next year, where that stickiness could result in non-performing assets remaining relatively unchanged, and possibly up a little bit?

The way we look at it is given the overall improvement in our credit metrics in recent quarters, and continuing into Q3, continuing with a low growth economy, but a growth economy, nonetheless, we think that the credit metrics will generally trend downward, i,e. improve, over the next several quarters, but there’s always a change that there’ll be a vulnerability in any quarter, in any particular credit metric, so we’re still pretty optimistic that the downward trend on a more expansive six or seven, eight quarter – linked quarter basis, we’ll hold. But from any quarter to quarter, there could be some variability. It’s just that uncertain an economy. Terry McElvoy – Oppenheiner : Just one more question for Beth. The margin guidance for Q4, does that take into consideration the continued run off of non-interest bearing deposits? and any comments at all, and I’m sure you’ll talk about this in January, about maybe where you see the margin directionally headed, in the first couple of quarters of next year.

Yeah, we have – our non-interest bearing deposits actually are at levels higher than we expected them to be, even though they were down modestly in the quality, that’s after, as I mentioned, six consecutive quarters of growth, so they’re still much higher than a year ago levels, so while we have seen some decline, I would expect that we could see a little modest decline in Q4, in non-interest bearing. So that’s certainly all the dynamics of thinking about all the different aspects of the balance sheet are factored into the outlook we gave, of the 330 to 335 in Q4. Related to next year, when I think about the margin, and we’re not assuming an increase in the Fed Funds rate next year, so we think that the margin looks pretty stable next year, relative to where it’s going to end up in Q4. And while there will still be further dissipation of the excess liquidity which will be deposited for the margin next year, versus 2010, we still will be working through -- particularly in the first half of the year, some offsets to that through the maturing of swaps. We have $800 million of swaps maturing, that have positive spreads in Q1, and also just working through these lower yield levels on the securities portfolio. So, there will be some positive from excess liquidity dissipating, particularly during the first half, offset by these other couple of factors that I mentioned. But we see the margins stable from Q4 levels into next year. Terry McElvoy – Oppenheiner : I appreciate that , thank you.

Thank you.

Your next question comes from the line of Gary Tennor (sp), of BA Davidson. Gary Tennor – BA Davidson: I had a question, Dale, you had made a comment a moment ago regarding (inaudible 1:03:02) opportunities, didn’t sound very constructive on those. We’ve heard from some other banks that they think there is some opportunity there in terms of structure and equity in these deals. Is it more a factor, would you say, for your appetite for the deals, or are you simply not seeing the kind of transactions that you would feel comfortable underwriting at this point in the cycle?

Well, I’d say a couple of things. One is nothing is worth changing purely for us, in terms of how we view, and we still have, as indicated, a fair amount of work to do on our CRE book, and frankly don’t want to divert too much attention from that. The other piece for me is we’re just not seeing a great level of opportunity, certainly quality opportunities in our footprint that we think make sense. We’re seeing some, but they’re being hotly contested and frankly some of the structures and pricing just don’t meet our parameters, so we’re holding firm to the kind of deal we want. The kind of competence, and kind of structures, including equity, and certainly the pricing. So that hasn’t changed, and frankly we’re just not seeing those kinds of opportunities at this point. Gary Tennor – BA Davidson: Okay, thanks for the call.

Thank you.

There are no further questions at this time.

I would like to thank everybody for joining us today, and for your continued interest in Comerica. Thank you very much.

This concludes today’s conference call, you may now disconnect.