In banking, the phrase "expense reduction" is often a euphemism for "layoffs."

The chief financial officers of Comerica Inc. and Huntington Bancshares Inc. avoided the L-word when speaking to investors on Wednesday but said their institutions are prepared to cut workers if revenue stays weak or the economy gets worse.

Both are hoping to avoid layoffs by attracting new customers: Comerica, of Dallas, is in the midst of buying a rival Texas bank. Huntington, of Columbus, Ohio, is keeping branches open longer and spending heavily to advertise its no-new-fees approach to banking.

But mounting pressure to cut costs means both are ready to send out pink slips if growth does not materialize.

Roughly "60% of expenses are people," Beth Acton, the chief financial officer of the $55 billion-asset Comerica, said at a New York investor conference sponsored by Deutsche Bank. "That's the key driver of what you can do to really impact the bottom line."

Donald Kimble, the CFO of the $53 billion-asset Huntington, said new employees represent a substantial proportion of the "incremental investments" that it has flexibility in "adjusting." Payroll costs — like its advertising budget — can be cut swiftly, he said.

"The investments we have been making for the most part have been in variable costs, whether it's traditional marketing dollars or head count," Kimble said. "I think those adjustments can be made within a quarter. So I think it is something that can be managed very efficiently and [be] very timely."

Comerica and Huntington are in similar positions in terms of spending. They are among a class of banks committed to investing to promote expansion, even if in the short term it causes expenses to trend higher than many investors would like.

Last quarter, Comerica was spending about 69 cents for every dollar of revenue; Huntington, about 65 cents per dollar of revenue. Those expense-per-dollar ratios are high compared with other large and midsize banks. Wells Fargo & Co.'s, for instance, is about 63 cents.

Investors pay close attention to expense-to-revenue ratios because they indicate how efficient an institution is at making money. Banks can improve the figure by cutting costs, increasing revenue or both.

"What happens in many large companies, particularly financial services companies, when they just focus on cost … it makes the relationship with the customer worse," said Jim Rowe, investor relations director at Wells Fargo. "It affects their ability to raise revenue, and we're not going to do that," he said.

Wells recently launched a cost-cutting initiative but has not shared many details.

The company did not mention layoffs on Wednesday, though it said last month that it was in the midst of letting go of several thousand mortgage specialists amid the housing downturn. In addition, the $400 million to $500 million Wells is spending per quarter to integrate the former Wachovia Corp. should decline by the first quarter of next year, Rowe said. Wells had 270,200 full- and part-time workers at the end of last quarter, up about 2,800 from a year earlier.

Comerica sees cost-saving and revenue-generating opportunities in its pending acquisition of Sterling Bancshares Inc. of Houston, Acton said.

It will consolidate some back-office functions and gain access to more clients for Comerica's treasury and wealth advisory services, she said.

Comerica's biggest tool for cutting costs has been layoffs, Acton said. A 17% head count reduction in the three years through 2010 enabled the bank to hold expenses steady despite increases in merit pay and rising regulatory costs, she said.

It had 8,955 full-time employees as of last quarter, 260 fewer than a year earlier.

Comerica has found it can earn just as much revenue with fewer people and is not planning to hire as the economy rebounds. Instead, a double-dip could lead to more staff cuts, Acton said.

Huntington had about 11,300 employees at the end of last quarter. That is about 641 more than a year earlier.