Darlene P. Persons - Senior Vice President and Director of Investor Relations Ralph W. Babb - Chairman, Chief Executive Officer, President, Chairman of Capital Committee, Chairman of Special Preferred Stock Committee and Member of Management Policy Committee Karen L. Parkhill - Vice Chairman, Chief Financial Officer and Member of Management Policy Committee Lars C. Anderson - Vice Chairman of the Business Bank and Member of Management Policy Committee John M. Killian - Chief Credit Officer, Executive Vice President and Member of Management Policy Committee

Steven A. Alexopoulos - JP Morgan Chase & Co, Research Division Keith Murray - ISI Group Inc., Research Division Brett D. Rabatin - Sterne Agee & Leach Inc., Research Division Ken A. Zerbe - Morgan Stanley, Research Division Erika Najarian - BofA Merrill Lynch, Research Division John G. Pancari - Evercore Partners Inc., Research Division Michael Rose - Raymond James & Associates, Inc., Research Division Bob Ramsey - FBR Capital Markets & Co., Research Division Brian Klock - Keefe, Bruyette, & Woods, Inc., Research Division David Rochester - Deutsche Bank AG, Research Division Gary P. Tenner - D.A. Davidson & Co., Research Division

Good morning. My name is Susan, and I will be your conference operator today. At this time, I would like to welcome everyone to the Comerica's Third Quarter 2013 Earnings Conference Call. [Operator Instructions] Thank you. Ms. Darlene Persons, Director of Investor Relations, you may begin your conference. Darlene P. Persons: Thank you, Susan. Good morning, and welcome to Comerica's Third Quarter 2013 Earnings Conference Call. Participating on this call will be our Chairman, Ralph Babb; Vice Chairman and Chief Financial Officer, Karen Parkhill; Vice Chairman of Business Bank, Lars Anderson; and Chief Credit Officer, John Killian. A copy of our press release and presentation slides are available on the SEC's website, as well as in the Investor Relations section of our website, comerica.com. As we review our third quarter results, we will be referring to the slides which provide additional details on our earnings. 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 speak 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 2 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. And in that regard, I would direct you to the reconciliation of these measures within this presentation. Now I'll turn the call over to Ralph, who will begin on Slide 3. Ralph W. Babb: Good morning. Today, we reported third quarter 2013 net income of $147 million or $0.78 per share compared to $143 million or $0.76 per share in the second quarter and $117 million or $0.61 per share in the third quarter of 2012. Quarterly earnings per share grew 28% over last year, primarily due to fee income growth, expense control and continued solid credit quality. Part of the expense improvement was due to a $25 million reduction in restructuring expense related to the successful integration of Sterling Bancshares. Turning to Slide 4 and other highlights. Average total loans were up $497 million or 1% on a year-over-year basis, but decreased $799 million or 2% compared to the second quarter. Loan volume in the third quarter compared to the second quarter was impacted by the continued economic uncertainty and the understandable caution of our customers, as well as seasonality in our auto-dealer floor plan loans and a decline in refinanced volumes impacting our mortgage warehouse financing business. While loans outstanding were down quarter-over-quarter, total loan commitments increased $560 million as of September 30, with commitments increasing in nearly all business lines. In addition, our loan pipeline remains strong and is 10% higher than it was a year ago. And we continue to grow deposits, reflecting our relationship banking strategy. Average total deposits increased $2 billion or 4% year-over-year and $417 million or 1% over second quarter to $51.9 billion. In further comparing our third quarter results to the second quarter, net interest income remained relatively stable at $412 million, reflecting the benefit from 1 additional day in the quarter and improved yields in the securities portfolio offset by the decline in loan balances and lower loan yields. Credit quality continued to be strong, resulting in an $8 million provision. Net charge-offs increased slightly from their low level, while nonperforming assets and watch list loans declined, resulting in a small reserve release. Noninterest income increased $6 million to $214 million, primarily due to a $4 million increase in customer-driven fee income. Noninterest expenses increased $1 million to $417 million as an increase in salaries and employee benefits expense was partially offset by decreases in other categories. Turning to our capital position. Our capital continues to be a source of strength to support our growth. At September 30, 2013, our tangible common equity ratio was 9.87%, and we estimate our Basel III Tier 1 common capital ratio to be 10.4%. We repurchased 1.7 million shares in the third quarter under our share repurchase program and are now 2 quarters into our 4 quarter share repurchase plan announced last March. Turning to Slide 5. We have a unique footprint that primarily covers the major Metropolitan areas in the 3 states you see here: Texas, California and Michigan, where there are good opportunities to pursue the types of businesses we serve. Our recent Texas Economic Activity Index showed the state economy ticked up in July after being relatively stable since last November. Gains in July were broad-based and indicated that upward momentum will likely continue in the months ahead. We expect the Texas economy to show solid growth through the end of this year. The FDIC's annual deposit survey as of June 30, 2013, recently made public shows that we have increased our market share in Dallas, Fort Worth and Austin. Average loans and deposits in Texas were both up 4% year-over-year, reflecting growth in most segments. Our most recent California Economic Activity Index is ahead of the 2012 average and reflects a variety of factors contributing to the improving, but uneven growth in the California economy. Labor markets are generally improving and residential real estate prices are firming statewide, so conditions look favorable for ongoing moderate economic expansion in the state. We strengthened our market share in the San Jose area according to the FDIC survey, while maintaining our market share position in greater Los Angeles. Average loans in California were up $1.1 billion or 8% year-over-year, with growth in most lines of business. Deposits were down 3% year-over-year, primarily due to a decline in deposits attached to our title escrow business as the mortgage refinance market slowed. Our most recent Michigan Economic Activity Index is well ahead of the average for all of 2012. Stronger auto sales in late summer should lead to solid production this fall. Labor markets are firming and house prices are improving so there is broadening support for the Michigan economy. We strengthened our #2 market share position in Michigan according to the FDIC survey. Average loans in Michigan were relatively stable year-over-year, while deposits grew 4%, reflecting increases in every segment. We remain focused on the bottom line in this uncertain environment with prolonged low rates. We believe our geographic footprint is well situated in Texas, California and Michigan and that our relationship banking strategy will contribute to our continued success. We are staying the course and maintaining our discipline with an eye on the road ahead. And now I will turn the call over to Karen. Karen L. Parkhill: Thank you, Ralph, and good morning, everyone. Turning to Slide 6, as Ralph mentioned, average total loans were up $497 million or 1% on a year-over-year basis. On a quarter-over-quarter basis, average loans decreased $799 million or 2%, reflecting a $630 million decrease in commercial loans and $180 million decline in combined Commercial Real Estate construction and mortgage loans. The decrease in average commercial loans was primarily driven by declines in general Middle Market, National Dealer Services and Mortgage Banker Finance, all of which I will discuss in more detail on the next slide. Offsetting some of this decline, average loans to our Technology and Life Sciences customers increased $112 million. In the broad category of Commercial Real Estate loans, construction loans grew for the third consecutive quarter, and commitments to developers continued to increase. However, we continue to see commercial mortgages decrease for 2 reasons: one, Commercial Real Estate construction projects continue to move quickly to the permanent long-term financing markets; and two, owner-occupied real estate, which makes up 73% of our Commercial Real Estate loans, continued to decline with normal amortization. You can see on the left chart that total period-end loans were down $1.3 billion, primarily due to an $875 million decrease in Mortgage Banker Finance and a $354 million decrease in National Dealer Services. As Ralph mentioned, our total loan commitments have increased in nearly all business lines. With commitments up and outstandings down, line utilization decreased to 45.4% from 48.6% at the end of the second quarter. Mortgage banker and auto dealer were the big drivers of the decline in utilization, but even without these 2 businesses, utilization was down 1%. Importantly, our loan pipeline remains strong and is 10% higher than it was a year ago. Finally, loan yields, shown in the yellow diamonds, declined 3 basis points in the quarter, reflecting the continued mix shift of our portfolio. Continuing with loans on Slide 7, we've provided additional data on the 3 major areas affecting our loan performance in the quarter. General Middle Market average loans were down compared to the second quarter, which we believe is related to customer cautiousness. This belief is supported by the fact that line commitments have increased slightly and average deposits have increased compared to the second quarter. As shown in the upper right chart, National Dealer Services, which includes our auto floor plan loans, had average total loans decline $223 million in the third quarter after increasing $250 million in the second quarter. The yellow diamonds show the period end inventory supply on dealer's lot. As you can see, the supply increased at the end of the third quarter, and along with that, our dealer outstandings grew $133 million in the last 2 weeks of the quarter. However, our average loan balances for the quarter were down, in line with the average inventory supply, shown by the orange diamond, reflecting both the strong sales level in the industry, as well as the normal seasonal changeover to new 2014 models. We expect to continue to see the normal seasonal pattern which would suggest that inventory levels will continue to rebuild in the fourth quarter. Shown in the bottom right chart, Mortgage Banker Finance, which provides mortgage warehouse lending lines, saw average loans decline $210 million in the third quarter, and as I mentioned a moment ago, declined $875 million at period end to $1.5 billion. This was expected given the rise in long-term rates and its impact on the refinancing market and is in line with the decline in mortgage volumes, which is shown on the yellow line on the chart. We expect these loans will continue to decline in the near term, but eventually stabilize, along with mortgage volumes. Turning to deposits on Slide 8. Our total average deposits increased $417 million or 1% to $51.9 billion, reflecting increases in most lines of business. Noninterest-bearing deposits grew $303 million while interest-bearing deposits increased $114 million. As shown by the yellow diamonds on the slide, deposit pricing declined to 18 basis points as higher rate CDs matured and repriced. Period end deposits increased $1.7 billion, primarily reflecting an increase of $2 billion in noninterest-bearing deposits, again, reflecting growth in most business lines, with the largest increase in Corporate Banking. Slide 9 provides details on our securities portfolio, which primarily consists of highly liquid, highly rated mortgage-backed securities. The NBS portfolio averaged $9 billion in the third quarter, down $411 million from the second quarter, resulting from a decline in the fair value of the portfolio due to the rise in long-term rates, combined with the slowdown in the pace of purchases to reinvest prepayments. The fair value of the portfolio decreased $34 million in pretax in the third quarter, resulting in a net unrealized loss position for the portfolio of $24 million. And the estimated duration of the portfolio increased slightly from 4.1 years at the end of the second quarter to 4.2 years at the end of the third quarter. This increase in duration resulted in a retrospective adjustment to the premium amortization of $4 million and added 17 basis points to the yield on the portfolio in the third quarter. The expected duration under a 200-basis-point rate shock remained relatively constant at about 5 years as a result of the composition of our portfolio. Based on current rate expectations, we believe that the pace of prepaids will continue to slow, with $350 million to $450 million in prepaids expected in the fourth quarter, down from almost $600 million in the third quarter. We continue to manage our portfolio dynamically, taking into account many factors, including our loan and deposit expectations, as well as overall yields and duration available. Turning to Slide 10. Despite the decline in loan volume, our net interest income remained relatively stable, with a small $2 million decline in the third quarter. We've summarized in the table on the right the major moving pieces to our net interest income and net interest margin. The net interest margin declined 4 basis points, including a 5-basis-point impact from the $1.2 billion increase in average excess liquidity, which added $1 million to net interest income. Total loan portfolio dynamics reduced net interest income by $7 million or 3 basis points on the net interest margin. This included a $6 million impact from reduced loans outstanding, $5 million from lower loan yields, resulting from the continued mix shift in our loan portfolio, as well as $1 million decline due to the drop in 30-day LIBOR, which decreased over 1 basis point on average in the quarter. You may recall that approximately 85% of our loans are floating rates, of which 75% are LIBOR-based, predominantly 30-day LIBOR. And while we remain focused on holding loan spreads for new and renewed credit facilities, there are still mix shift dynamics impacting the loan portfolio. This quarter, the mix shift was primarily due to higher-yielding loan balances declining and continued positive credit migration. Offsetting these negative impacts, interest on loans benefited from 1 additional day in the quarter, which added $4 million, and from $1 million increase in accretion of the purchase discount on the acquired portfolio. We have recorded $26 million in accretion so far this year and expect to recognize about $2 million to $4 million in the fourth quarter. We have about $35 million of total accretion remaining, which we expect to realize over the next few years at a declining pace. Dynamics in the securities portfolio had a positive benefit, increasing net interest income by $2 million or 3 basis points on the margin, primarily the result of a $4 million improvement in yields due to slowing prepayment speeds. This was partially offset by a decrease in average balances. Finally, lower funding costs, including debt maturities in the second quarter, as well as lower deposit costs, added $2 million and provided a 1 basis point increase to the margin. We believe our asset-sensitive balance sheet remains well positioned for rising rates. Based in our historical experience and asset liability model, we believe a 200-basis-point increase in rates over a 1-year period, equivalent to 100 basis points on average, would result in about a 13% increase in net interest income or approximately $200 million. This number is higher than the equivalent number in the prior quarter due to our growth in deposits. Turning to the credit picture on Slide 11. Credit quality continue to be strong in the third quarter. Net charge-offs increased slightly to $19 million or 18 basis points of average loans. The charts on the right show our watch list loans declined $210 million and our nonperforming loans declined $12 million. With a decline in nonperforming loans, the allowance to NPLs increased to 131%. And as you can see on the lower left chart, our $604 million allowance for loan losses covers our trailing 12 months net charge-offs over 6x. As a result of the continued positive trends in our credit metrics, our provision for credit losses declined $5 million from the second quarter to $8 million, resulting in a small reserve release. Finally, as we mentioned last quarter, we received the annual Shared National Credit exam results at the end of June. They were reflected in our second quarter numbers and were not significant. Slide 12 outlines the $6 million increase in noninterest income, which was driven by a $4 million increase in customer-driven fees. Commercial lending fees were the largest contributor, increasing $6 million due to higher syndication agent fees and higher facility fees charged on commitments. These increases were partially offset by a decline in fiduciary income, primarily due to seasonally higher fees in the second quarter related to tax return preparation. The increase in noncustomer-driven income was primarily due to an increase of $5 million in warrant income from the exercise of warrants related to some Technology and Life Sciences relationships. Somewhat offsetting this increase was a decline in incentives received from our third-party credit card provider. Last quarter, we booked the full $6 million annual incentive payment. Going forward, we will record this incentive which can vary from year to year on a quarterly basis. Turning to Slide 13. Our expenses remained well controlled, which resulted in relatively stable expenses in the third quarter. Salaries and benefits expense increased $10 million. This reflected an increase in incentives, as well as 1 additional day in the third quarter, which was partially offset by lower staff insurance expense. The incentive expense increase includes a year-to-date accrual adjustment for senior officers incentives based on favorable performance relative to peers, as well as an increase in business unit incentive, in line with increased loan commitments, fee income and deposits. Offsetting the salary and benefit increase was a decline in other noninterest expenses. This included a decrease of $6 million in litigation-related expenses, primarily due to a $5 million legal reserve release, following the pending settlement of a class action case. And we had a $4 million write-down on other foreclosed assets in the second quarter that was not repeated. Moving to Slide 14 and shareholder payout. In the third quarter, we repurchased 1.7 million shares under our share repurchase program. Combined with the dividends paid, we returned 70% of net income to our shareholders in the third quarter. We believe our shareholder payout is a reflection of our strong capital position, with an estimated Basel III Tier 1 common capital ratio of 10.4% at September 30 on a fully phased-in basis, excluding the impact of AOCI. Shares repurchased were more than offset by share dilution primarily from our warrants as average stock price increased during the quarter. Finally, turning to Slide 15 and our outlook. We have typically provided a year-over-year outlook and updated it through the year. Along those lines, know that our expectations for full year 2013 compared to full year 2012 remains unchanged with the exception of customer-driven fee income. Given the strong fee generation we had, particularly in the third quarter, we do believe that our full year 2013 customer-driven fees will be modestly higher than our 2012 customer-driven fees. Turning to the final quarter of the year. This slide outlines our expectations for the fourth quarter relative to the third quarter. We expect average loans to be stable with third quarter levels. We believe we will see a rebound on our auto dealer floor plan loans as dealers receive their 2014 model inventory, and we expect mortgage banker outstandings to continue to decline, in line with the Mortgage Banker association forecast for mortgage origination. We also intend to maintain our pricing and structure discipline which is core to our culture and has served us well throughout economic cycles. Net interest income is expected to be lower in the fourth quarter due to an expected decline in purchase accounting accretion, as well as the continued effect of the low rate environment. We expect loan portfolio yields to decline due to the continued loan mix shift and improving asset quality. With continued strong credit quality, we expect net charge-off, provision and reserve release to remain low, similar to what we have seen in the past 3 quarters. We expect customer-driven noninterest income for the fourth quarter to be relatively stable as we believe we will be able to continue to generate the solid fees we booked in the third quarter. On the other hand, noncustomer-related income can include volatile and unusual items. For example, we had a $6 million annual incentive payment from our third-party credit card processor in the second quarter and a $6 million in warrant income from Technology and Life Sciences customers in the third quarter. These types of items are difficult to predict, but overall, we expect noncustomer-related income should decline in the fourth quarter. Finally, we expect slightly lower expenses in the fourth quarter as we continue to manage expenses carefully. Incentive compensation should be lower in the fourth quarter given the year-to-date accrual adjustment we incurred in the third quarter. This will be offset by additional expenses related to regulatory compliance, predominantly stress testing, as well as seasonality of certain expenses such as occupancy. In summary, we will continue to focus on the things we can control, allocating resources to our faster-growing markets and industry segments to grow relationships, while carefully managing expenses. Now we are happy to answer your questions.

[Operator Instructions] Your first question comes from the line of Steven Alexopoulos with JPMorgan. Steven A. Alexopoulos - JP Morgan Chase & Co, Research Division: Maybe I could start, looking at core C&I loan trends, excluding mortgage banker and dealer finance, you've seen a real weakening over the past few quarters. I know you said commercial customers are cautious, something you've said over the last few quarters, but do you have a sense why customers seem to be getting so much more cautious here? And how do you reconcile that with your customers continuing to want more commitments, but then going on to borrow even less? Ralph W. Babb: Lars, you want to take that one? Lars C. Anderson: Yes, well, a couple of things, Steve. First of all, if you look back over the last several quarters, you'll see a continued increase actually. If you look over the last 1.5 years, about a $4 billion increase overall in commercial loan outstandings. That's about 18% in growth. But your point is well taken that we have seen utilization rates decline this quarter. If you strip out the Mortgage Banking Finance and National Dealer Services, utilization rates are down about 1% on the rest of the businesses. Frankly, I think it's a reflection. And I spend a lot of time with customers and they have just continued uncertainty about the current economic environment. It's difficult for them to make investment decisions with pretty unclear economic horizon right now. So we're going to focus on what we can control, and that is making sure that in the markets we serve, we continue to grow customers, which we're doing. We're broadening customer relationships. You see these commitments continue to rise, and I think we're going to be well positioned. Once the confidence returns, we're going to start to see access to those commitments. And I think we have some nice upside potential there, Steve, once that confidence does return to the marketplace, at least for the markets that we serve, in Texas, California and Michigan and some of our industry groups. Steven A. Alexopoulos - JP Morgan Chase & Co, Research Division: Okay. And maybe one just for Karen. How should we think about the timeline to deploy this excess liquidity position that you built up in the securities book over the next quarter or so, or do you hold some of that for eventual loan growth? Karen L. Parkhill: No problem, Steve. Thank you. Our securities portfolio, we treat on a very dynamic basis. That includes the excess liquidity that we hold at the Fed. We do want to remain positioned for loan growth, and as we think about that, we will manage it dynamically, taking into account the forward factors around where we think our deposits are going, where we think our loans are going. And we are also mindful of our securities portfolio, the long-term effect that, that could have, particularly on our tangible common equity as that will be mark-to-market in a rising rate environment. Steven A. Alexopoulos - JP Morgan Chase & Co, Research Division: Does that imply that you just hold this position about where it stands today? Karen L. Parkhill: We'll continue to manage it dynamically. We can't say whether we'll hold it or not, but it will be a dynamic equation.

Your next question comes from the line of Keith Murray with ISI. Keith Murray - ISI Group Inc., Research Division: Maybe just to go back on the loan growth question for a second. When we looked at your footprint places like California, Texas, healthy economies that are growing, it doesn't seem to be coming through in the loan growth. Is it just potentially big types of industry groups that you guys are dealing with? I'm just curious. What's the disconnect there? Ralph W. Babb: Well, I think what -- Lars can follow up on this, too, but underlying what he was talking about earlier is our customers are doing very well in the economies where they are and the footprint that we have. But they're being very cautious about investing for the future like they normally would until they get a good feeling as to, as Lars put it, what the rules will be going forward. And as we all know, we have a lot going on right now in Washington as well, and people are holding and waiting and watching to see what's going to happen before they move forward. Lars C. Anderson: Yes, let me just -- to really underscore Ralph's point, if you take Michigan as an example in the automotive industry, we bank some of the best in the business there. In the Middle Market space, they're doing very well. They're generating a lot of excess cash. And frankly, they're delevering. I was with a customer just a couple of weeks ago. They're running 3 shifts. They're running about 100% capacity. His position was, we're going to continue this through the end of year, kind of get through the window. But he said, frankly, he's prepared to make some very significant investments in '14 if the auto industry continues at the pace that it's on. And frankly, I think most would expect that. In Texas, I think if you look at those numbers, our underlying kind of general Middle Market activity and commitment levels are very good. In fact, if you look at our commitments in linked quarters, they were up very nicely in Texas. But you did have some impact from Energy, which is based here out of, again, unique industry, based out of Texas. The Energy portfolio has been fairly flat the last couple of quarters, and that certainly figures into the math and the geography as a number of our Energy customers really focused on harvesting existing investments and accessing the bond market in paying down debt. But they're the same customers. We're well positioned, and we're well positioned for growth with them as they start to refocus on CapEx and rig counts go up. Keith Murray - ISI Group Inc., Research Division: Okay. So could we just switch to the capital side for a second? You guys are obviously in a very strong position as you head into your first round of CCAR. Just when you think about the potential, what you would ask for under CCAR, is there any change to the thought process under the CapPR scenario, meaning this is the first time you're going through this particular process? Any change in the mindset around that? Karen L. Parkhill: Yes, it is the first time that we will be moving from a CapPR bank to a CCAR bank. We have been investing very heavily in people and technology to improve our process as a CCAR bank. It's too early to talk about what our potential capital ask would be, though. But I think it's important to know that we continue to believe that we come at this from a position of capital strength.

Your next question comes from the line of Brett Rabatin with Sterne Agee. Brett D. Rabatin - Sterne Agee & Leach Inc., Research Division: Wanted to ask a question just around pricing and I know last quarter the large Corporate segment took a bit of a decline just due to you guys stepping away from what you were seeing in terms of pricing. Can you talk about that this quarter and maybe more in terms of Middle Market and what you're seeing in terms of how that's impacted your loan balances and the decisions you had to make around that? Ralph W. Babb: Lars? Lars C. Anderson: Sure. Well, let me just clarify something from the second quarter earnings call. The Corporate Banking space continues to be a very important business for us in the long term. We've got some great customers there that we continue to work with and grow. And we're just having to be more selective in terms of new opportunities because that is where we see the most competitive space, not just from a pricing perspective but also from a structure perspective. And this is clearly not the time to overreach. If you do, there's consequences, so we're being patient. We're being very focused. We've got some great bankers, a lot of experience. And I think it's going to be a segment that's going to grow in the future. But we're going to be patient and we're going to be disciplined about our relationship pricing. In the Middle Market segment, it's a competitive marketplace out there across our footprint. It's hard to pick one geography over another to say which is the most competitive today. I think the thing that you got to focus on is making sure that your bankers are spending a lot of time in the marketplace and they're spending a lot of time with customers and prospects, building out those relationships. And I'd remind you, there's ways to improve profitability, client profitability, just beyond the credit pricing, and that's your broadening relationships and we're focusing on that as you'll see client-driven, noninterest income gains. We're very focused on cross-sell. But it's a challenging market, but I think that we've got the right business model. The Middle Market knows that we've been committed to it for a very long time, and we're very well positioned for a recovering economic environment. Brett D. Rabatin - Sterne Agee & Leach Inc., Research Division: Okay. And then my other follow-up was just around Technology and Life Sciences and maybe any color around the growth you did have this quarter. Was that any of that market share gains or was that all just kind of the growth of the segment? Lars C. Anderson: Yes. So you saw the IPO market obviously pick up more recently. And frankly, at the end of the day, the IPO market, the exit market, really drives the whole Technology and Life Sciences kind of space. You've got to have active DCs [ph] and private equity investment to make that work well. If you look at the -- if you break it down, if you look at the early stage part of Technology and Life Sciences, we continue to have very, very strong national market share, and we're very active in that space. We've also seen some excellent growth in our equity fund services business where we provide both core banking services, credit services into venture capital -- capitalist and private equity firms that have been very successful and recently announced that we had opened a new office in New York where we're seeing a lot of growth, and that's gotten a lot of traction. We've also opened an additional office in Houston, hired some great bankers there and we're seeing some nice successes there. So I see this as a good, long-term growth business for us.

Your next question comes from the line of Ken Zerbe with Morgan Stanley. Ken A. Zerbe - Morgan Stanley, Research Division: First question, just on expenses, I want to clarify the -- obviously, your guidance is for lower expenses in the fourth quarter. It seemed like it was because of an accrual adjustment and third quarter being a little higher. Is that right? But are you undertaking any more, I want to say, aggressive expense initiatives to keep expenses lower given what we're seeing on the loan side? Karen L. Parkhill: Yes, thanks, Ken. You are right. One of the key reasons that we expect expenses to be lower in the fourth quarter is because we did have a year-to-date accrual adjustment in the third quarter around incentive comps given our relative performance to our peers, so that is one of the big drivers. We do expect some expenses to increase in the fourth quarter, as I mentioned, namely, some seasonal expenses like occupancy, as well as some expenses related to stress testing capital planning. On expenses in general, we remain keenly focused on managing our expenses as we have for the past several years, and we will continue to do that, but there are not any major aggressive initiatives as we manage those expenses. It's really just continuing to do what we've done all along. Ken A. Zerbe - Morgan Stanley, Research Division: Okay, that helps. And then in terms of the slower prepayments, I know you highlighted the $600 million down to $350 million to $450 million. I'm assuming that the lower premium amortization is in your lower NII guidance, but can you quantify that? Like, how much potentially comes from slower premium amortization versus the negatives of the other items? Karen L. Parkhill: Yes, you're right, it is in our guidance. And yes, we do expect slower prepays next quarter. We continually look at the life of our portfolio each quarter, the expected life. And as we continue to look at it, if rates continue to rise and prepays continue to slow, the expected life of our portfolio will extend a little bit, and that could result in some slower premium amortization going forward and a possible reversal of premium previously recognized, but that shouldn't be by a material amount. Ken A. Zerbe - Morgan Stanley, Research Division: Okay. And then just a clarification question, the incentive payment from the third-party credit card provider. Presumably, we had it last quarter. We -- we're not expecting it this quarter, so actually this quarter was a surprise positive. It was extra income versus what we normally would've assumed. Just want to make sure I'm right on that. Karen L. Parkhill: Yes. So as I mentioned, we used to record that incentive payment on an annual basis. We now will accrue it each quarter going forward. So yes, last quarter did have an annual payment and this quarter had some accrual.

Your next question comes from the line of Erika Najarian with Bank of America Merrill Lynch. Erika Najarian - BofA Merrill Lynch, Research Division: My first question is on the efficiency outlook for next year. I think you mentioned, Karen, that you're controlling the things that you can control, and your efficiency ratio has been consistent in about 67% over the past several quarters. As we look out into 2014, if there's not a significant improvement in the loan growth outlook and the rate environment remains what it is, is there more room on the expense side to drop that efficiency ratio from the 67%? Or is most of the efficiency improvement from here going to come from the revenue side? Karen L. Parkhill: Yes. We -- as you know, Erika, we did set a long-term efficiency ratio target to be below 60%, and we continue to focus on moving toward that target regardless of the overall environment. Erika Najarian - BofA Merrill Lynch, Research Division: Got it, got it. So I just wanted to make sure I understood that. If nothing changes on the revenue picture, you're still committed to taking it down below 60% on the other side of the equation? Karen L. Parkhill: Yes. When we first announced that target, we did show a walk forward of what it will take to get there, which includes loan growth, fee growth, keeping expenses as flat as possible, and the fact that we would need a little bit of a rate environment uptick to ultimately get over the goal line, but certainly not a normal rate environment to get over the goal line. And so as we think about that in the near term without a rate environment uptick, we won't necessarily get over the goal line, but we will continue to bring that efficiency ratio down. Erika Najarian - BofA Merrill Lynch, Research Division: Got it. And just a follow-up to Steve's question on the liquidity. Are you comfortable with your liquidity levels relative to the liquidity proposals that are -- might -- may be finalized at the end of this year? In other words, if the LCR passes as defined, how much excess liquidity do you have to redeploy? Karen L. Parkhill: Yes, so the rules are far from final. We don't even have an initial draft or an NPR out in the United States. We are continuing to monitor that heavily. On the LCR ratio, as guided by the Basel III committee, we and all banks would need to add liquid assets to our portfolio. Erika Najarian - BofA Merrill Lynch, Research Division: Got it. And just one more question, if I may. The larger banks have to deal with the supplementary leverage ratio that has them holding 100% capital against unfunded lines of commitment. Do you think that's an opportunity for potentially market share taking for regional banks like yours that don't have to deal with the SLR? Or is it way too early to tell? Karen L. Parkhill: I think it's very early to tell because there are so many other things that can affect the competitive environment. You are right in the case that we, at least as proposed right now, will not need to adhere to a supplemental leverage ratio. We do, however, need to adhere to the normal leverage ratio which, for us, is not the binding constraint.

Your next question comes from the line of John Pancari with Evercore. John G. Pancari - Evercore Partners Inc., Research Division: Loan growth front, I wanted to get a little bit more clarity on what you're seeing on the Commercial Real Estate front. I know you gave us some good color that you're seeing borrowers remain cautious on the commercial front in general, but are you seeing any noted improvement in CRE lending? I know that some of the other CRE lenders are starting to see improving drawdowns on that front. Ralph W. Babb: Lars, do you want to take that? Lars C. Anderson: Yes, sir. We -- as you can see in our numbers, our actual construction lending continues to make gains. We, again, showed another quarter of growth there. There is -- there's a lot of volume out there. We're positioned in terrific states, Texas and California, where you're seeing, in particular, a disproportionate amount of multi-family activity. And I think we're certainly getting our share. In fact, if you go to that page, I think it's 24, in the slides, it gives you a pretty good view of what's going on with our Commercial Real Estate portfolio. And as you see, the construction loans continue to increase. What you'll also notice is that the commercial mortgage loans, we have not seen that kind of increase, and there's really 2 components to that. The first is the mini perms, that is the conversion of construction projects over to a short-term extension of credits, typically 3 to 5 years for our developers for them to stabilize and position the market to go to the permanent market or sell the product. What they're seeing is a higher velocity of these projects moving more rapidly to the permanent market. The permanent market is taking, at this point, unstabilized, in some cases, projects, which is very unusual and different from, say, going back a year ago. The other component of that would be owner occupied. In the owner-occupied space, you're continuing to see, given the profile or the kinds of customers that we bank, they continue to delever. You see natural amortization. You see them paying off some of that longer-term debt that's on their balance sheet. And one last thing I'd note, there are some lenders in the marketplace that are providing, what I would say, is longer-term financing within banking that is outside of our underwriting standards, 15-, 20-year kind of fixed-rate financing, 30-year amortization. And that's not something that we do. So again, a time not to overreach. We're going to focus working with our developers and we got the same stable of them. We're picking up some new ones. These are typically very strong developers that have liquid positions. They're putting a lot of liquidity into these projects. And one of the things that I would point out with the increase in the construction portfolio, we are expecting that we will see advances under those credit facilities as we kind of go down the road and as they fulfill their obligation to properly equitize these projects. So I think we're well positioned. I think we got great long-term markets. We got great bankers, and I think that this is a business that will serve us well as we head down the road. John G. Pancari - Evercore Partners Inc., Research Division: Okay, that's helpful. So the permanent financing players, the insurance companies and the conduit fencers are certainly getting more aggressive? Lars C. Anderson: Yes, absolutely. Both -- you see it in the pricing for sure, but you also see it in the structure. John G. Pancari - Evercore Partners Inc., Research Division: Okay, all right. And then, secondly, on the pricing side, can you give us a little bit of actual data points there in terms of where you're seeing new money yields come in on C&I and CRE right now? Lars C. Anderson: I wish I could tell you exactly, kind of take an off-the-shelf price for you, that would make it easy. But we handle one relationship at a time at Comerica. Each one of them are individually underwritten. There's no standardized product. We look at the overall relationship. It's beyond just the credit. It has to do with how deep we get into the relationship. I'm really proud of the success we're making, for example, in deepening our relationships across into Wealth Management. We've seen a 50% increase in the penetration rate in Wealth Management services to our customers over the last couple of years. That's a lot of progress that's been made, and that all goes into ensuring that we're getting the right kinds of returns on the relationship for our shareholders. But I'll sum it up maybe helping you a little bit and just say that I don't see any easing in the competitiveness in the marketplace. It continues to be very aggressive. There's too few opportunities for the demand that's out there, so we're having to be very patient and careful. But we're also having to be more active in the marketplace looking for the right kinds of opportunities for the companies, developers that are looking for the value proposition that we deliver, that relationship banking kind of strategy.

Your next question comes from the line of Michael Rose with Raymond James. Michael Rose - Raymond James & Associates, Inc., Research Division: My questions have been answered.

Your next question comes from the line of Bob Ramsey with FBR Capital Markets. Bob Ramsey - FBR Capital Markets & Co., Research Division: Just real quick, I was hoping you could talk a little bit more about the mortgage warehouse business. I mean, it looks like the average balances are down much less than I would've guessed given industry volume, and I'm curious what to make of that. And then the end-of-period balance is down a lot more. How much of that is the normal end-of-period volatility? And how much of that is something that's more of an indicator of where we are headed into the next quarter? Lars C. Anderson: Okay, very good. I'll take it, the second piece of it first, which is the ending balances. I'll tell you, it's very difficult to tell. There's a lot of variability at the end of each quarter and a lot of it has to do with the investors and kind of the activity levels that we see in terms of migrating those to the investor community. It's difficult to use that as a proxy for the fourth quarter, but maybe going back to the first part of your question will help you with that second part. And that is, the mortgage banking association's projection is that we were down 27% in the third quarter in overall mortgage volume nationally, as you probably know. We were down a little bit under 12% in averages, so we clearly outperformed the industry in terms of averages. But you get to the end of the quarter and, obviously, we were down significantly, significantly more, which is not all that unusual. However, the MBA is forecasting an additional kind of 20%, 30% decline heading into the fourth quarter of the year. So that could clearly impact the outstandings that we have in our portfolio. A strategic issue that I want to point out and I think that has served us very well, if you go back to 2011, we have increased the number of mortgage companies that we finance, staying very true to our strategy of the strongest and the best in the industry. We've increased the number of customers that we serve by 40%. So the business has become much more granular, we have a broader base. The second piece of it is this, in the national market, 49% of the mortgage volume was purchase. Our average for the third quarter was 71%. In other words, it was much more skewed toward purchase volumes, which, frankly, has been a strategic initiative of ours to make sure that we try to capture what, to me, appear to be a recovering national housing market and would likely be a slowing refi market, and I think that's played out well for us. Bob Ramsey - FBR Capital Markets & Co., Research Division: Okay. So it sounds like the better performance versus the industry in the quarter is part purchase versus refi mix and part continued growth in customers? That's a fair synopsis? Lars C. Anderson: Yes. Bob Ramsey - FBR Capital Markets & Co., Research Division: And then what happened to yields in that portfolio in the quarter? Lars C. Anderson: We're starting to see more activity there. There's more players in the market, and we're seeing more pressure unquestionably as more competitors enter the space seeing it as an opportunity. We're going to have to continue to stay very focused on our relationship pricing overall. One thing that we're very much focused on in trying to offset some of the compression areas, even deepening the -- our relationships with those customers in terms of cross-sell and we're doing that. In fact, our treasury management penetration into that space continues to grow disproportionately to the rest of the franchise, and I think that that's a real positive. But that's going to be clearly a challenge for us as there's fewer opportunities and there's more players in the marketplace. Bob Ramsey - FBR Capital Markets & Co., Research Division: Okay, that's helpful. Then I guess changing gears, one last question. I just want to be sure I'm thinking about net interest income in the fourth quarter correctly. I mean, it sounds like it should be something on the magnitude of at least $8 million to $10 million lower and that you lose $4 million to $6 million of premium amortization and you shouldn't have the $4 million retroactive adjustment on premium adjustment on the MBS portfolio. Is that a fair way to think about how we enter the fourth quarter and then you've got sort of the normal drag from the low rate environment? Karen L. Parkhill: Yes. So we do expect net interest income to be lower, as we mentioned. You're right on the numbers that you put out for accretion on the loan portfolio. It's difficult to predict what we would do on the securities portfolio and the premium amortization because that is a very dynamic equation, but you have the direction correct.

Your next question comes from the line of Brian Klock with Keefe, Bruyette, & Woods. Brian Klock - Keefe, Bruyette, & Woods, Inc., Research Division: So my follow-up question is for Karen. On the expense side, to Ken's question earlier, so I'm calculating about a $6 million impact for the accrual in the quarter. You talked about a $5 million reserve, legal reserve release. So I guess, those 2 seem to be offsetting. I guess what I'm thinking about, though, is when I look at the other noninterest expense line, it was $37 million this quarter. I'm thinking that, that $5 million reserve release came out of there, so that's running still a couple of million dollars later than it's been for the last 5 or 6 quarters. And I was trying to find out, maybe you can update guidance to that $15 million CCAR expense item. Would have thought we would've seen some of that here in the third quarter so maybe you can kind of -- so does that make sense, first of all, all the math that I was kind of throwing together with that noninterest expense line being something that's more like a $42 million quarterly run rate? And then where can we find the CCAR expense build in the numbers? Karen L. Parkhill: Sure. On our regulatory expenses, we did talk about that being approximately $15 million in an increase in expenses. Most of that -- the vast majority of it is already built into our run rate, you are correct. Brian Klock - Keefe, Bruyette, & Woods, Inc., Research Division: Okay. And then a question for Lars. I know, Karen, you said at the -- I think you said at the end of the last 2 weeks of the quarter the National Dealer Services book grew about $133 million. And I'm wondering, I guess, Lars, do you think that we do see this fourth quarter build, the net book -- there was an article out yesterday in the Automotive News expecting that sales volumes could be down 10% here in the fourth quarter because of the government shutdown. So does that extend the inventories a little bit longer? Does it take the dealers a little bit longer to rebuild that inventory? Or I guess, how should we think about the pace and how fast dealers will rebuild inventories during the fourth quarter? Lars C. Anderson: Right. So first of all, regarding the government kind of issues, I'm -- I don't really think that that's going to have a significant impact at this point on our overall Dealer portfolio. I just had lunch in the last 2 days with one of our largest automotive customers. And frankly, things are as good with him and his business, which is in both Michigan and in Texas, as it's ever been. Yes, he's seeing that typical seasonal new model turnover. Karen talked about the days on hand in inventory that we typically see. You didn't see that a year ago. That was because the Japanese were rebuilding their model brands in this country, but historically, you see it. You saw -- you're seeing it this year. We did begin to see the rebuilding of inventory levels. But typically, it happens gradually as we go through the fourth quarter, up right through the end of the year. And if you look at historically, the average days on hand in January typically is kind of the highest level of the year, that's our peak month. So hopefully, that gives you some insight. I -- frankly, I'm very bullish on our Dealer business. Our dealers -- when I talk about there's variation in how our customers are feeling, clearly, this is an industry where, largely, our customers are feeling very good. They're making a lot of money. They're well positioned. They're rebranding, and refacing a lot of their facilities. You can see that probably in your own marketplace. And auto sales remain up, so we're well positioned. Brian Klock - Keefe, Bruyette, & Woods, Inc., Research Division: Got it, thanks for that color. And I guess maybe I can squeeze in one quick one. I don't know if John Killian is there, but Texas provisions went up this quarter. Is there anything to think about what's going on there in Texas versus all the positive credit performance in the rest of the geographies? Ralph W. Babb: John? John M. Killian: Sure, Brian. There's nothing unusual there from a portfolio trend standpoint. Texas suffers a little bit from having such great basic loan quality that when 1 or 2 deals does happen to have some distress, it looks like an aberration, and that's how I view it as well. Brian Klock - Keefe, Bruyette, & Woods, Inc., Research Division: Okay. So can you tell us whether that was Commercial Real Estate or C&I or... John M. Killian: It was C&I, Middle Market C&I.

Your next question comes from the line of Dave Rochester with Deutsche Bank. David Rochester - Deutsche Bank AG, Research Division: Just a follow up on Bob's question on the Mortgage Banker Finance business. You mentioned the pricing came in this quarter. I was just wondering if you could provide the delta there over the last quarter. And if you give the current yield on that portfolio, that would be great. Karen L. Parkhill: Yes, we don't give yields out for that specific portfolio. It is a portfolio that has higher yields than some of our others, so... Lars C. Anderson: Yes. So we've seen -- I'll just put it to you this way, we've seen slight compression. And if you look at our current portfolio against our new and renewed, there's a very slight compression there, but it continues to be a very attractive overall business for Comerica. David Rochester - Deutsche Bank AG, Research Division: Great. And just one last one. Sorry if you already covered this, but the bump-up in the commercial mortgage yield during the quarter, what the driver was there? Karen L. Parkhill: Yes. That was mainly due to attrition of securities that were lower yielding and as well as accretion.

Your last question comes from the line of Gary Tenner with D. A. Davidson. Gary P. Tenner - D.A. Davidson & Co., Research Division: Lars, I just had a question. You drew down a little bit in Texas vis-à-vis the Energy portfolio, a little bit of a decline there sequentially, but can you kind of talk about the other loan segments within the Texas market? I was, I guess, surprised given the strength of that market in general that we had that sort of sequential decline in outstanding balances. Lars C. Anderson: Right, yes. So I think some of the big story, if you just look at the overall growth in Texas, obviously, we had some nonstrategic assets in Commercial Real Estate that were running off. That certainly impacted some of our numbers. You heard me talk about the Energy portfolio that leveled out as a number of our customers accessed the overall bond market and paid down some of their senior debt. But frankly, I'm very encouraged. We've got -- we've added additional Middle Market bankers in the Houston market that continues to grow. We're seeing nice growth there in Middle Market. The Dallas-Fort Worth market, we're seeing good activities there, pipelines. And I would also point out, we're seeing really nice activities in small business. In fact, not just nationally, but also in Texas, in particular, we've seen sequential quarters of small business outstandings growing. So I think if you put all that together, along with our Wealth Management, it's -- we're very well positioned in this day. I think we've got a lot of the right businesses. I'd point out one other business that's fairly significant here, and we've got a nice presence and we expanded and that's Technology and Life Sciences. I've told you, I see this as a long-term growth business for us. We have -- that is based out of Austin, Texas, which is a hotbed for tech companies. That continues to grow, be very active. We're seeing pipelines grow there. We've expanded into Houston. I think we'll see that grow. We've added bankers in Environmental Services that are really canvassing the state. And again, as -- we're seeing increased cap levels, their CapEx levels, and Environmental Services as a lot of companies are very focused on going green. Reclamation, recycling is becoming a bigger part of their overall capital base, and we're going to take advantage of that because we've got a lot of expertise in that industry.

I would now like to turn the call back over to Ralph Babb, Chairman and Chief Executive Officer. Ralph W. Babb: Thank you very much for joining us on the call today. We appreciate your interest and hope everybody has a good day. Thank you.

This does conclude today's conference call. You may now disconnect.