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The higher-for-longer interest-rate environment weighed on banks during the quarter as one central theme this earnings season, banking-industry players told MarketWatch.

Comerica Incorporated (CMA) Q3 2023 Earnings Call Transcript

Comerica (NYSE:CMA) reported third quarter earnings and revenue that topped Wall Street estimates, despite its profits decreasing almost 30% year-over-year. The Dallas, Texas-based financial services company posted a decrease in profits from $351 million in the year-ago quarter to $251 million.

An increase in revenues, supported by higher fee income, aids Comerica's (CMA) Q3 earnings. However, increasing expenses and higher allowance for credit losses are headwinds.

Comerica Incorporated (CMA) came out with quarterly earnings of $1.84 per share, beating the Zacks Consensus Estimate of $1.70 per share. This compares to earnings of $2.60 per share a year ago.

The regional bank posted third-quarter earnings of $1.84 a share, while Wall Street was expecting $1.69.

Comerica Inc.'s CMA, -1.28% stock rose 1.2% in premarket trading on Friday after the bank said its third-quarter net income fell by 28% to $251 million, or $1.84 a share, from $351 million, or $260 a share in the year-ago quarter. The bank was expected to earn $1.69 a share, according to the FactSet consensus estimate.

A weaker lending environment and high funding costs are likely to have affected Comerica's (CMA) NII. A fall in fee income is also expected to hurt its Q3 Earnings.

First up are JPMorgan Chase & Co. NYSE: JPM, Wells Fargo Co. NYSE: WFC and Citigroup Inc. NYSE: C.  Those reports will likely offer hints as to whether the bigger financial institutions are seeing consumers and businesses pulling back from borrowing and spending.

This year's regional banking crisis has already caused changes in the S&P 500 index. More changes may be coming if the industry faces a protracted slump.