DOW JONES NEWSWIRES Comerica Inc.'s (CMA) first-quarter earnings soared 98% as the regional lender reported a 72% drop in its loan-loss provisions. Meanwhile, Sterling Bancshares Inc. (SBIB), which Comerica in January agreed to acquire in a deal valued at $906 million, reported a sharply narrower loss as it set aside far less for potential loan losses. The deal, expected to close in the current quarter, is part of Comerica's strategy to diversify its business from the Midwest. Comerica strongholds are in economically hit areas as Michigan, Arizona, Florida and California, spurring it to look at other regions with better economic prospects. The move also was one in a recent handful of deals by larger, better capitalized banks acquiring those weakened by the recession and housing downturn. Banking industry profits have been improving as lenders set less aside to cover potential loan losses and as defaults decline on consumer debt--though top-line growth has been more difficult to attain amid falling credit-card balances. Comerica reported a profit of $103 million, or 57 cents a share, up from $52 million a year earlier. Including the payment of preferred dividends, the year-earlier loss was 46 cents a share. Revenue decreased 1.2% to $602 million. Analysts polled by Thomson Reuters most recently forecast earnings of 48 cents on revenue of $589 million. Loan-loss provisions fell to $49 million from $175 million a year earlier and $57 million in the fourth quarter. Meanwhile, Sterling reported loss of $370,000, or breakeven on a per-share basis, from a year-earlier loss of $6.2 million, or 7 cents a share. Revenue decreased 2.1% to $49.6 million. Analysts polled by Thomson Reuters most recently forecast earnings of 2 cents on revenue of $49 million. Loan-loss provisions fell to $10.8 million from $22.9 million a year earlier and $5.3 million in the fourth quarter. Shares of Comerica and Sterling closed Monday at $37.46 and $8.76, respectively. Neither was active premarket. -By Tess Stynes, Dow Jones Newswires; 212-416-2481; Tess.Stynes@dowjones.com
