Fifth Third Bancorp 8K Results of Operations and Financial Condition | FITB 22 Jul 08

Exhibit 99.1



		News Release
CONTACTS:	Jeff Richardson (Investors)	FOR IMMEDIATE RELEASE
	(513) 534-0983	July 22, 2008
	Jim Eglseder (Investors)
	(513) 534-8424
	Debra DeCourcy, APR (Media)
	(513) 534-4153

FIFTH THIRD BANCORP REPORTS SECOND QUARTER 2008 EARNINGS.

FAVORABLE CORE TRENDS CONTINUE, MORE THAN

OFFSET BY HIGHER CREDIT COSTS AND LEVERAGED LEASE CHARGE.

•

Loss per share of $0.37 driven by $0.42 charge related to tax treatment of leveraged leases

•

Pre-tax, pre-provision earnings were $602 million; $745 million excluding leveraged lease and merger expense impact, up 16 percent from a year ago

•

Noninterest income increased 8 percent from the second quarter of 2007

•

Payments processing income growth of 15 percent

•

Deposit service revenue up 12 percent

•

Corporate banking income growth of 26 percent

•

Mortgage banking revenue up 108 percent

•

Net interest income is flat versus the second quarter of 2007; up 17 percent excluding leveraged lease litigation charges

•

Average loans up 11 percent and transaction deposits up 6 percent

•

Second quarter issuance of $1.1 billion in convertible preferred securities

•

Total capital ratio of 12.15 percent

•

Tier 1 capital ratio of 8.51 percent

•

Tangible equity ratio of 6.37 percent

Earnings Highlights


	For the Three Months Ended															% Change
	June 2008			March 2008			December 2007			September 2007			June 2007			Seq		Yr/Yr
Net income (in millions)	($	202	)	$	286		$	16		$	325		$	376		NM		NM
Common Share Data
Earnings per share, basic		(0.37	)		0.54			0.03			0.61			0.69		NM		NM
Earnings per share, diluted		(0.37	)		0.54			0.03			0.61			0.69		NM		NM
Cash dividends per common share		0.15			0.44			0.44			0.42			0.42		(66	%)	(64	%)
Financial Ratios
Return on average assets		(0.73	%)		1.03	%		0.06	%		1.26	%		1.49	%	NM		NM
Return on average equity		(8.4	)		12.3			0.7			13.8			15.7		NM		NM
Tier I capital		8.51			7.72			7.72			8.46			8.13		10	%	5	%
Net interest margin (a)		3.04			3.41			3.29			3.34			3.37		(11	%)	(10	%)
Efficiency (a)		58.6			42.3			72.6			59.2			54.1		39	%	8	%
Common shares outstanding (in thousands)		577,530			532,106			532,672			532,627			535,697		9	%	8	%
Average common shares outstanding
(in thousands):
Basic		540,030			528,498			529,120			530,123			540,264		2	%	—
Diluted		540,030			530,372			530,939			532,471			543,228		2	%	(1	%)

(a)	Presented on a fully taxable equivalent basis

NM:	not meaningful

Fifth Third Bancorp (Nasdaq: FITB) today reported a second quarter 2008 net loss of $202 million, or $0.37 per diluted share, compared with earnings of $286 million, or $0.54 per diluted share, in the first quarter of 2008 and $376 million, or $0.69 per diluted share, for the same period in 2007.

Reported results included charges related to leveraged leases totaling $0.42 per share. In our 8-K filed on June 18, 2008, and previous filings, we noted that this charge was possible. Reported results included a charge of approximately $130 million pre-tax, or $0.16 per share after-tax, to reflect a projected change in the timing of tax benefits pursuant to FSP FAS 13-2, and an increase to tax expense of approximately $140 million, or $0.26 per share both pre-tax and after-tax, required for interest related to previous tax years pursuant to FIN 48. The actual charge in total was modestly lower than we previously estimated was possible if we determined a charge was necessary. Based on recent court decisions related to leveraged leases and current uncertainty regarding the outcome of our own case, we have concluded that previously recognized benefits from the transactions must be remeasured as required by FIN 48. We believe this charge addresses the remaining downside risk we have related to leveraged leases should there be a negative outcome in our case. We continue to believe that our tax treatment was proper under the tax law as it existed at the time the tax benefits were reported and that the facts in our case are different than other cases decided and support our position. Accordingly, we will continue to defend our leases in the courts. Additional discussion regarding this issue can be found later in this release. Reported results also included $13 million pre-tax, or $0.02 per share after-tax, in acquisition-related expenses.

On June 18, after evaluating a variety of potential credit scenarios through 2009, Fifth Third raised the Tier 1 capital ratio target range to 8 - 9 percent and issued $1.1 billion of additional capital in the form of convertible preferred securities. Additionally, given the outlook for a continued negative credit environment, the common dividend was reduced to conserve capital in current and future periods. The combination of those actions raised the Tier 1 ratio to 8.51%, the middle of the revised target range as of June 30, 2008.

“The capital actions we announced in June, combined with our expected strong core earnings growth and the anticipated sale of non-core businesses, significantly strengthens our capital position. We believe we have the capacity to withstand provision expense and losses in excess of stress scenarios we evaluated, creating a significant capital cushion to withstand unexpected developments. These actions reflect our commitment to protect the health and strength of the Bank, now and in the future,” said Kevin T. Kabat, Chairman and CEO of Fifth Third Bancorp.

“While we were disappointed in our overall results for the second quarter, which included a charge related to leveraged leases, they were largely in line with our expectations last month. Absent unexpected events, we anticipate returning to profitability in the third quarter.

“Non-performing assets and net charge-offs continued to increase reflecting weakening economic conditions. Deteriorating credit trends remain disproportionately attributable to commercial and residential real estate

loans, particularly in Florida and Michigan, and we continue to be very active in taking steps to address these issues that we and the industry are facing.

“Based on the decisive action we’ve taken, we believe we have the capacity to absorb future losses in excess of what we’ve modeled and are well-positioned relative to our peers. Throughout this economic downturn, we’ve maintained our focus on our long-term goals and objectives, and we continue to make investments in our businesses and execute on our strategic plans. As this quarter shows, we continued to produce strong operating results and we remain committed to posting bottom-line results that outperform the industry once this cycle turns.”

Income Statement Highlights


	For the Three Months Ended															% Change
	June 2008			March 2008			December 2007			September 2007			June 2007			Seq		Yr/Yr
Condensed Statements of Income ($ in millions)
Net interest income (taxable equivalent)	$	744		$	826		$	785		$	760		$	745		(10	%)	—
Provision for loan and lease losses		719			544			284			139			121		32	%	492	%
Total noninterest income		722			864			509			681			669		(16	%)	8	%
Total noninterest expense		858			715			940			853			765		20	%	12	%

Income before income taxes (taxable equivalent)		(111	)		431			70			449			528		NM		NM

Taxable equivalent adjustment		6			6			6			6			6		—		—
Applicable income taxes		85			139			48			118			146		(39	%)	(42	%)

Net income (loss) available to common shareholders (a)		(202	)		286			16			325			375		NM		NM

Earnings per share, diluted	($	0.37	)	$	0.54		$	0.03		$	0.61		$	0.69		NM		NM

(a) Dividends on preferred stock are $.185 million for all quarters presented

NM: not meaningful

Net Interest Income

	For the Three Months Ended															% Change
	June 2008			March 2008			December 2007			September 2007			June 2007			Seq		Yr/Yr
Interest Income ($ in millions)
Total interest income (taxable equivalent)	$	1,213		$	1,453		$	1,556		$	1,535		$	1,495		(17	%)	(19	%)
Total interest expense		469			627			771			775			750		(25	%)	(37	%)

Net interest income (taxable equivalent)	$	744		$	826		$	785		$	760		$	745		(10	%)	—

Average Yield
Yield on interest-earning assets		4.95	%		5.99	%		6.52	%		6.73	%		6.75	%	(17	%)	(27	%)
Yield on interest-bearing liabilities		2.23	%		2.99	%		3.78	%		4.04	%		4.08	%	(25	%)	(45	%)

Net interest rate spread (taxable equivalent)		2.72	%		3.00	%		2.74	%		2.69	%		2.67	%	(9	%)	2	%

Net interest margin (taxable equivalent)		3.04	%		3.41	%		3.29	%		3.34	%		3.37	%	(11	%)	(10	%)
Average Balances ($ in millions)
Loans and leases, including held for sale	$	112,098		$	111,291		$	107,727		$	102,131		$	100,767		1	%	11	%
Total securities and other short-term investments		53,763			53,458			51,967			50,922			50,932		1	%	6	%
Total interest-bearing liabilities		84,417			84,353			80,977			76,070			73,735		—		14	%
Shareholders’ equity		9,629			9,379			9,446			9,324			9,599		3	%	—

Net interest income of $744 million on a taxable equivalent basis declined $82 million from the first quarter of 2008 largely due to the recalculation of cash flows on certain leveraged lease transactions that reduced net interest income by approximately $130 million. Excluding this charge, net interest income increased by $48 million, or 6 percent, from the previous quarter. Net interest income benefited from lower funding costs on core deposits and wholesale borrowings, a steeper yield curve and lower balances in higher priced consumer certificates of deposit (CD). This more than offset the effect of

lower asset yields, the issuance of additional wholesale funding and higher loan interest reversals and nonaccrual balances in the quarter. Net interest income included the benefit of $31 million in accretion and amortization of fair value purchase accounting adjustments related to First Charter Corporation (First Charter). It is expected that net interest income will continue to benefit from this effect in coming quarters. The reported net interest margin was 3.04 percent, down 37 bps from the first quarter of 2008. Excluding the impact of the leveraged lease litigation, net interest margin was 3.57 percent, a 16 bp increase from the previous quarter. The accretion and amortization of First Charter purchase accounting adjustments provided a 13 bp benefit to the net interest margin, with the additional improvement due to lower core deposit and wholesale funding costs.

Compared with the second quarter of 2007, net interest income was flat and net interest margin declined 33 bps from 3.37 percent due to the impact of the charge related to our leveraged lease litigation. Excluding the impact of the leveraged lease litigation charges, net interest income increased by $129 million, or 17 percent, from the same period in 2007, and net interest margin expanded 20 bps. The increase in net interest income reflected average earning asset growth of 11 percent and 25 bps of widening in the net interest rate spread.

Average Loans


	For the Three Months Ended										% Change
	June 2008		March 2008		December 2007		September 2007		June 2007		Seq		Yr/Yr
Average Portfolio Loans and Leases ($ in millions)
Commercial:
Commercial loans	$	28,299	$	25,367	$	23,650	$	22,183	$	21,584	12	%	31	%
Commercial mortgage		12,590		12,016		11,497		11,041		11,008	5	%	14	%
Commercial construction		5,700		5,577		5,544		5,499		5,595	2	%	2	%
Commercial leases		3,747		3,723		3,692		3,698		3,673	1	%	2	%

Subtotal - commercial loans and leases		50,336		46,683		44,383		42,421		41,860	8	%	20	%

Consumer:
Residential mortgage loans		9,922		10,395		9,943		8,765		8,490	(5	%)	17	%
Home equity		12,012		11,846		11,843		11,752		11,881	1	%	1	%
Automobile loans		8,439		9,278		9,445		10,853		10,552	(9	%)	(20	%)
Credit card		1,703		1,660		1,461		1,366		1,248	3	%	36	%
Other consumer loans and leases		1,125		1,083		1,099		1,138		1,174	4	%	(4	%)

Subtotal - consumer loans and leases		33,201		34,262		33,791		33,874		33,345	(3	%)	—

Total average loans and leases (excluding held for sale)	$	83,537	$	80,945	$	78,174	$	76,295	$	75,205	3	%	11	%
Average loans held for sale		1,676		3,967		3,998		1,950		1,843	(58	%)	(9	%)

Average portfolio loan and lease balances grew 3 percent sequentially and 11 percent from the second quarter of 2007 with approximately 1 percent of the sequential growth and 3 percent of the year-over-year growth attributable to acquisitions. Average commercial loans and leases grew 8 percent sequentially and 20 percent compared with the previous year. Growth was primarily driven by commercial and industrial (C&I) lending, up 12 percent sequentially and 31 percent versus a year ago, reflecting solid production across most of our footprint and the effect of acquisitions while approximately $1.0 billion, or 4 percent, of sequential growth in C&I loans was due to commercial loans held for sale reclassified to portfolio loans during the quarter. Compared with last quarter, commercial mortgage balances increased $574 million and commercial construction balances grew by $123 million. The acquisition of First Charter contributed $179 million and $114 million, respectively. Consumer loan and lease balances declined 3 percent sequentially and were flat from

the second quarter of 2007. Excluding balances from acquisitions, average consumer loans were down 4 percent sequentially and 5 percent year-over-year. Sequentially, growth in home equity and credit card loans was more than offset by declines in auto, primarily due to first quarter of 2008 sales and securitizations, and residential mortgage loans. On a year-over-year basis, growth in credit card and residential mortgage loans offset a decline in auto loans. Almost all of the year-over-year growth in residential mortgage loan balances was due to the fourth quarter of 2007 acquisition of R-G Crown. In the first quarter of 2008, the Bancorp securitized and sold $2.7 billion in auto loans. During the second quarter of 2008, the Bancorp sold approximately $523 million of residential mortgage portfolio loans.

Average Deposits


	For the Three Months Ended										% Change
	June 2008		March 2008		December 2007		September 2007		June 2007		Seq		Yr/Yr
Average Deposits ($ in millions)
Demand deposits	$	14,023	$	13,208	$	13,345	$	13,143	$	13,370	6	%	5	%
Interest checking		14,396		14,836		14,394		14,334		15,061	(3	%)	(4	%)
Savings		16,583		16,075		15,616		15,390		14,620	3	%	13	%
Money market		6,592		6,896		6,363		6,247		6,244	(4	%)	6	%
Foreign office (a)		2,169		2,443		2,249		1,808		1,637	(11	%)	33	%

Subtotal - Transaction deposits		53,763		53,458		51,967		50,922		50,932	1	%	6	%

Other time		9,517		10,884		11,011		10,290		10,780	(13	%)	(12	%)

Subtotal - Core deposits		63,280		64,342		62,978		61,212		61,712	(2	%)	3	%

Certificates - $100,000 and over		8,143		5,835		6,613		6,062		6,511	40	%	25	%
Other foreign office		2,948		3,861		2,464		1,981		732	(24	%)	303	%

Total deposits	$	74,371	$	74,038	$	72,055	$	69,255	$	68,955	—		8	%

(a)	Includes commercial customer Eurodollar sweep balances for which the Bancorp pays rates comparable to other commercial deposit accounts.

Average core deposits were down 2 percent sequentially and up 3 percent from the second quarter of 2007. Excluding acquisitions, core deposits declined 3 percent for the quarter and were relatively unchanged from the previous year. Transaction deposits (excluding consumer time deposits) grew 1 percent from the first quarter and 6 percent from a year ago. The sequential growth and 2 percent of the year-over-year growth were attributable to acquisitions. The decline in core deposits compared to the first quarter of 2008 was driven by lower foreign office commercial sweep deposits, interest checking, money market and consumer CD balances which more than offset growth in demand deposit account (DDA) and savings balances. On a year-over-year basis, growth in DDA, savings, money market and foreign office deposits balances more than offset lower interest checking and consumer CD balances. The decline in consumer CD balances in the second quarter of 2008 reflected unusually high competitor pricing in many of our markets and our determination that such pricing was not reflective of the value of these deposits.

Retail core deposits decreased 1 percent sequentially and were relatively unchanged from the second quarter of 2007. Comparisons for both periods reflect an increase in net new accounts offset by lower average account balances. Commercial core deposits decreased 3 percent sequentially and increased 7 percent year-over-year.

The $2.3 billion sequential increase in jumbo CDs resulted from actions taken early in the second quarter to extend the average duration of wholesale borrowings to reduce exposure to high levels of market volatility.

Noninterest Income


	For the Three Months Ended												% Change
	June 2008			March 2008		December 2007			September 2007		June 2007		Seq		Yr/Yr
Noninterest Income ($ in millions)
Electronic payment processing revenue	$	235		$	213	$	223		$	212	$	205	10	%	15	%
Service charges on deposits		159			147		160			151		142	8	%	12	%
Investment advisory revenue		92			93		94			95		97	(1	%)	(5	%)
Corporate banking revenue		111			107		106			91		88	3	%	26	%
Mortgage banking net revenue		86			97		26			26		41	(11	%)	108	%
Other noninterest income		49			177		(113	)		93		96	(72	%)	(49	%)
Securities gains (losses), net		(10	)		27		7			13		—	NM		NM
Securities gains, net - non-qualifying hedges on mortgage servicing rights		—			3		6			—		—	(100	%)	NM

Total noninterest income	$	722		$	864	$	509		$	681	$	669	(16	%)	8	%

Noninterest income of $722 million declined $142 million sequentially and increased $53 million, or 8 percent, from a year ago. First quarter of 2008 results included a $273 million gain resulting from the Visa IPO, partially offset by a $152 million pre-tax charge to reduce the cash surrender value of one of our Bank-Owned Life Insurance (BOLI) policies. Excluding the impact of Visa and BOLI in the first quarter and net securities gains/losses in both the first and second quarters of 2008, noninterest income increased $18 million, or 3 percent, from the previous quarter. Year-over-year growth in noninterest income of 8 percent was driven by strong growth in payments processing revenue, deposit fees, corporate banking revenue and mortgage banking revenue.

Electronic payment processing (EPP) revenue of $235 million increased 10 percent sequentially and 15 percent from a year ago driven by continued strong merchant processing results, up 16 percent. Card issuer interchange revenue increased 20 percent from the previous year, driven by higher debit and credit card usage and an increase in the average dollar amount per debit card transaction. Financial institutions revenue grew 10 percent from the second quarter of 2007.

Service charges on deposits of $159 million increased 8 percent sequentially and 12 percent compared with the same quarter last year. Retail service charges increased 12 percent from the first quarter and 7 percent from the second quarter of 2007. Both sequential and year-over-year comparisons reflect strong growth in net new accounts and higher deposits fees. Commercial service charges increased 4 percent sequentially and 19 percent compared with last year. This growth primarily reflects the effect of lower market interest rates, as reduced earnings credit rates paid to customers have resulted in higher realized net use of services fees to pay for treasury management services.

Corporate banking revenue of $111 million increased 3 percent sequentially and 26 percent year-over-year. Revenue growth for both periods was driven by broad-based strength, with particularly strong growth in foreign exchange revenue, up 10 percent sequentially and 79 percent from the same period in 2007, institutional sales revenue, up 4 percent sequentially and 35 percent year-over-year, and business lending

fees, up 8 percent sequentially and 23 percent from the second quarter of 2007. Strong results continue to be driven by more volatile markets and increased penetration of the Company’s middle market customer base.

Investment advisory revenue of $92 million was down 1 percent sequentially and 5 percent from the second quarter of 2007. Institutional trust revenue decreased 1 percent sequentially and 6 percent year-over-year largely due to market value declines. Mutual fund fees were up 1 percent sequentially and down 10 percent year-over-year resulting from market volatility. Brokerage fee revenue was up 1 percent sequentially and down 12 percent from the second quarter of 2007 reflecting the continued shift in assets from equity products to money market funds and a decline in transaction-based revenues.

Mortgage banking net revenue totaled $86 million in the second quarter of 2008, an $11 million decline from strong first quarter results and a $45 million increase from the second quarter of 2007. Second quarter originations were $3.3 billion, a decline of 17 percent from the previous quarter, due to rising interest rates and lower commensurate application volumes and originations in the latter half of the quarter. Second quarter originations resulted in gains on the sale of mortgages of $79 million compared to gains of $93 million during the previous quarter and $25 million during the same period in 2007. Revenue for the second quarter included $9 million related to gains on the sale of portfolio loans compared with $11 million in the previous quarter and $2 million in the second quarter of 2007. The first quarter of 2008 adoption of FAS 159 for mortgage banking contributed $17 million of the year-over-year increase in mortgage banking revenue and additional origination costs recorded in other noninterest expense. Net servicing revenue, before mortgage servicing rights (MSR) valuation adjustments, totaled $11 million in the second quarter, compared with $8 million last quarter and $13 million a year ago. MSR valuation adjustments, including mark-to-market related adjustments on free-standing derivatives, represented a net loss of $4 million in the second quarter of 2008, compared with a net loss of $3 million last quarter and a net gain of $3 million a year ago. The mortgage-servicing asset, net of valuation reserve, was $697 million at quarter end on a servicing portfolio of $38.7 billion.

Net losses on investment securities were $10 million in the second quarter of 2008 compared with net gains of $27 million last quarter.

Other noninterest income totaled $49 million in the second quarter of 2008 compared with $177 million last quarter and $96 million in the second quarter of 2007. Second quarter 2007 results included a $16 million gain on the sale of non-strategic credit card accounts. Last quarter’s results included a $273 million gain resulting from the Visa IPO, a charge of $152 million related to the decrease in the cash surrender value of one of the Bancorp’s BOLI policies, $26 million in hedge and other losses associated with the sale of auto loans and $15 million in gains on sale from auto securitization transactions. The year-over-year decline in other noninterest income was driven by approximately $20 million in write-downs on other real estate owned (OREO) properties in the second quarter of 2008 as well as the credit card gain a year ago.

Noninterest Expense


	For the Three Months Ended										% Change
	June 2008		March 2008		December 2007		September 2007		June 2007		Seq		Yr/Yr
Noninterest Expense ($ in millions)
Salaries, wages and incentives	$	331	$	347	$	328	$	310	$	309	(5	%)	7	%
Employee benefits		60		85		56		67		68	(29	%)	(11	%)
Payment processing expense		67		66		68		65		59	2	%	14	%
Net occupancy expense		73		72		70		66		68	2	%	8	%
Technology and communications		49		47		47		41		41	3	%	18	%
Equipment expense		31		31		32		30		31	—		—
Other noninterest expense		247		67		339		274		189	269	%	31	%

Total noninterest expense	$	858	$	715	$	940	$	853	$	765	20	%	12	%

Noninterest expense of $858 million increased by $143 million sequentially and $93 million from a year ago. Second quarter results included $13 million in acquisition-related expenses as a result of the First Charter and First Horizon acquisitions during the quarter. First quarter results included the reversal of $152 million in Visa litigation reserves, $9 million in severance-related costs, $7 million in acquisition-related expenses due to the acquisition of R-G Crown and $18 million of seasonally higher FICA and unemployment expenses. Excluding the aforementioned items, noninterest expense increased $12 million, or 1 percent, from the first quarter of 2008. Expense growth was primarily related to volume-related processing and technology investment expense. The increase in noninterest expense compared with the second quarter of 2007 was driven by higher costs due to acquisitions, increased loan and lease processing costs as a result of collections activities, increased provision for unfunded commitments, as well as increased franchise and other taxes as a result of the impact of the favorable settlement of certain tax audits in the second quarter of 2007. Additionally, $8 million of the year-over-year increase in other noninterest expense was related to increased FDIC insurance expense which previously was offset by prior insurance premium credits.

Credit Quality


	For the Three Months Ended
	June 2008			March 2008			December 2007			September 2007			June 2007
Total net losses charged off ($ in millions)
Commercial loans	($	107	)	($	36	)	($	48	)	($	23	)	($	24	)
Commercial mortgage loans		(21	)		(33	)		(15	)		(8	)		(16	)
Commercial construction loans		(49	)		(72	)		(12	)		(5	)		(7	)
Commercial leases		—			—			—			—			—
Residential mortgage loans		(63	)		(34	)		(18	)		(9	)		(9	)
Home equity		(54	)		(41	)		(32	)		(27	)		(20	)
Automobile loans		(26	)		(35	)		(30	)		(25	)		(15	)
Credit card		(21	)		(20	)		(15	)		(13	)		(10	)
Other consumer loans and leases		(3	)		(5	)		(4	)		(5	)		(1	)

Total net losses charged off		(344	)		(276	)		(174	)		(115	)		(102	)
Total losses		(365	)		(293	)		(193	)		(127	)		(124	)
Total recoveries		21			17			19			12			22

Total net losses charged off	($	344	)	($	276	)	($	174	)	($	115	)	($	102	)
Ratios
Net losses charged off as a percent of average loans and leases (excluding held for sale)		1.66	%		1.37	%		0.89	%		0.60	%		0.55	%
Commercial		1.41	%		1.21	%		0.66	%		0.33	%		0.44	%
Consumer		2.04	%		1.58	%		1.18	%		0.93	%		0.68	%

Net charge-offs as a percentage of average loans and leases were 166 bps in the second quarter, compared with 137 bps in the first quarter of 2008 and 55 bps in the second quarter of 2007. Loss experience continues to be concentrated in Michigan and Florida and primarily related to consumer residential real estate loans as well as commercial loans to residential real estate builders and developers. Michigan and Florida represented approximately 44 percent of total second quarter net charge-offs. Residential real estate losses were 34 percent of total net charge-offs. Losses on loans to residential real estate builders and developers represent 10 percent of total losses.

Consumer net charge-offs of $167 million, or 204 bps, grew $32 million from the first quarter of 2008, driven primarily by losses in the residential real estate portfolio. Net charge-offs in Michigan and Florida represented 48 percent of consumer losses in the second quarter, in line with results from the first quarter of 2008. Home equity net charge-offs of $54 million increased $13 million compared with last quarter, primarily due to increased losses on brokered home equity loans reflecting borrower stress and lower home price valuations. Originations of these brokered loans was discontinued last year. Net losses on brokered home equity loans were $28 million, or 51 percent, of second quarter home equity losses. Brokered home equity loans represented $2.4 billion, or 20 percent, of the total home equity portfolio of $12.4 billion. Michigan and Florida represented 42 percent of second quarter home equity losses. Net charge-offs within the residential mortgage portfolio were $63 million, an increase of $29 million, primarily a result of declining property values on loans in foreclosure, with losses in Michigan and Florida representing 72 percent of losses in the second quarter. Net charge-offs in the auto portfolio declined by $9 million from the first quarter to $26 million. Net charge-offs on consumer credit card loans were $21 million, up $1 million from the first quarter. During the quarter, we adjusted our credit card charge-off policy related to bankruptcies to conform with industry standards and to increase the likelihood of recoveries and customer affirmation of Fifth Third in bankruptcy proceedings. Credit card charge-offs would have been $4 million higher absent this change.

Commercial net charge-offs of $177 million, or 141 bps, increased $36 million compared with the first quarter of 2008. Losses related to residential real estate builders and developers represented $34 million, or 19 percent, of commercial net charge-offs. Commercial construction net charge-offs decreased to $49 million from $72 million the previous quarter driven by lower losses in Michigan. Michigan and Florida accounted for 61 percent of these losses in the second quarter. Commercial mortgage net charge-offs decreased to $21 million, down $12 million from the first quarter of 2008. Michigan and Florida accounted for 58 percent of


	For the Three Months Ended
	June 2008			March 2008			December 2007			September 2007			June 2007
Allowance for Credit Losses ($ in millions)
Allowance for loan and lease losses, beginning	$	1,205		$	937		$	827		$	803		$	784
Total net losses charged off		(344	)		(276	)		(174	)		(115	)		(102	)
Provision for loan and lease losses		719			544			284			139			121

Allowance for loan and lease losses, ending		1,580			1,205			937			827			803
Reserve for unfunded commitments, beginning		103			95			79			77			79
Provision for unfunded commitments		12			8			13			2			(2	)
Acquisitions		—			—			3			—			—

Reserve for unfunded commitments, ending		115			103			95			79			77
Components of allowance for credit losses:
Allowance for loan and lease losses		1,580			1,205			937			827			803
Reserve for unfunded commitments		115			103			95			79			77

Total allowance for credit losses	$	1,695		$	1,308		$	1,032		$	906		$	880
Ratio
Allowance for loan and lease losses as a percent of loans and leases		1.85	%		1.49	%		1.17	%		1.08	%		1.06	%

these losses. Net charge-offs in the C&I portfolio were $107 million, up $71 million from the first quarter of 2008. This increase was driven by a $23 million charge-off in Illinois as well as particular weakness among businesses associated with residential construction activities.

Provision for loan and lease losses totaled $719 million in the second quarter of 2008, exceeding net charge-offs by $375 million. The increase in the provision for loan and lease losses and allowance for loan and lease losses was largely driven by higher inherent losses resulting from deterioration in residential real estate collateral values, particularly in the residential homebuilder and developer portfolios and consumer residential real estate portfolios, and negative trends in nonperforming and other criticized assets.

The allowance for loan and lease losses represented 1.85 percent of total loans and leases outstanding as of quarter end, compared with 1.49 percent last quarter and 1.06 percent in the same quarter last year.


	As of
	June 2008			March 2008			December 2007			September 2007			June 2007
Nonperforming Assets and Delinquency ($ in millions)
Commercial loans	$	407		$	300		$	175		$	175		$	136
Commercial mortgage		524			312			243			146			113
Commercial construction		537			408			249			105			65
Commercial leases		18			11			5			5			4
Residential mortgage (a)		329			211			121			74			40
Home equity (b)		151			128			91			61			45
Automobile		7			5			3			3			3
Credit card (c)		15			13			5			—			—
Other consumer loans and leases		—			—			1			—			—

Total nonaccrual loans and leases	$	1,988		$	1,388			893			569			406
Repossessed personal property		22			22			21			19			17
Other real estate owned (d)		188			182			150			118			105

Total nonperforming assets	$	2,198		$	1,592		$	1,064		$	706		$	528

Total loans and leases 90 days past due	$	605		$	539		$	491		$	360		$	302
Nonperforming assets as a percent of total loans, leases and other assets, including other real estate owned		2.56	%		1.96	%		1.32	%		0.92	%		0.70	%

a)	Nonaccrual loans include debt restructuring balances of $187 as of 06/30/08, $73 million as of 03/31/08, $29 million as of 12/31/07, $6 million as of 09/30/07 and $2 million as of 06/30/07.

b)	Nonaccrual loans include debt restructuring balances of $116 as of 06/30/08, $86 million as of 03/31/08, $46 million as of 12/31/07, and $16 million as of 09/30/07

c)	All nonaccrual credit card balances are the result of debt restructurings.

d)	Excludes government insured advances.

Nonperforming assets (NPAs) at quarter end were $2.2 billion, or 2.56 percent of total loans and leases and OREO, up from 1.96 percent last quarter and 0.70 percent in the second quarter a year ago. Sequential growth in NPAs was $606 million, or 38 percent, down from 50 percent growth in the first quarter. Second quarter growth was driven by increases related to residential real estate builders and developers in the commercial portfolio and restructurings of mortgage and home equity loans in the consumer portfolio.

Commercial NPAs of $1.5 billion, or 2.93 percent, grew $465 million, or 44 percent, in the second quarter of 2008. Commercial NPA growth was primarily driven by continued deterioration in the commercial construction and commercial mortgage portfolios, particularly in Michigan and Florida. NPAs in the C&I portfolio of $414 million, increased $109 million, from the previous quarter, driven by a $20 million increase in residential homebuilder and developer NPAs and weakness among customers associated with residential construction activities. Commercial construction NPAs were $552 million, an increase of $133 million from the first quarter of 2008. Commercial mortgage NPAs were $540 million, a sequential increase of $216 million. Commercial

real estate loans in Michigan and Florida represented 42 percent of our total commercial real estate portfolio. Increases in NPAs in these states represented 74 percent of commercial real estate NPA growth and these regions accounted for 68 percent of total commercial real estate NPAs. Residential real estate builders and developers represented approximately $547 million in commercial NPAs and increased $239 million from the first quarter of 2008, accounting for approximately half of the increase in total commercial NPAs.

Consumer NPAs of $674 million, or 2.00 percent, increased $141 million, or 26 percent, in the second quarter of 2008. Of the growth, $136 million was experienced in residential real estate portfolios. Residential mortgage NPAs increased $115 million to $448 million. Of residential mortgage NPAs, $12 million were in residential construction loans (of which $7 million was OREO). Home equity NPAs increased $21 million to $183 million. OREO represented $119 million of total residential mortgage NPAs and $32 million in total home equity NPAs. Residential real estate loans in Michigan and Florida represented 64 percent of the growth in residential real estate NPAs, 59 percent of total residential real estate NPAs, and 36 percent of total residential real estate loans. Included within consumer NPAs, primarily in residential real estate loans, were $318 million in troubled debt restructurings, including $146 million restructured in the second quarter of 2008. These debt restructurings assist qualifying borrowers in creating workable payment plans to enable them to remain in their homes.

Loans still accruing over 90 days past due were $605 million, up $67 million or 12 percent, from the first quarter of 2008. Consumer 90 days past due balances increased 10 percent from the previous quarter and commercial 90 days past due balances increased 15 percent. Growth in commercial and consumer 90 days past dues was generally concentrated in commercial real estate and residential mortgages.

Capital Position/Other


	For the Three Months Ended
	June 2008 (a)		March 2008		December 2007		September 2007		June 2007
Capital Position
Average shareholders’ equity to average assets	8.59	%	8.43	%	8.77	%	9.13	%	9.53	%
Tangible equity	6.37	%	6.19	%	6.14	%	7.00	%	7.18	%
Tangible common equity	5.40	%	6.19	%	6.14	%	6.99	%	7.17	%
Regulatory capital ratios:
Tier I capital	8.51	%	7.72	%	7.72	%	8.46	%	8.13	%
Total risk-based capital	12.15	%	11.34	%	10.16	%	10.87	%	10.54	%
Tier I leverage	9.08	%	8.28	%	8.50	%	9.23	%	8.76	%

(a)	Current period regulatory capital data and ratios are estimated

During the second quarter, we issued $400 million in trust-preferred securities and $750 million of five-year senior notes. On June 18, 2008, we announced a plan to raise our target for the Tier 1 capital ratio to 8-9%. In conjunction with this plan, we issued $1.1 billion in convertible preferred securities which raised our Tier 1 ratio to the middle of our target range, We also announced a reduction in our quarterly dividend to $0.15 per share from the prior $0.44 level, which conserves approximately $1.2 billion of common equity by the end of 2009 relative to the previous dividend level. Additionally, we announced our intention to sell certain non-core businesses, which we expects to generate more than $1 billion on an after-tax basis.

The tangible equity ratio increased 18 bps to 6.37 percent primarily due to the issuance of the convertible preferred securities, which contributed 96 bps to the ratio. The Tier 1 capital ratio increased 79 bps to 8.51 and the total capital ratio increased 81 bps, primarily due to the convertible preferred issuance which contributed 93 bps to both Tier 1 and Total capital.

As previously disclosed, Fifth Third filed suit against the IRS seeking a refund of taxes paid as a result of the audit of the 1997 tax year. This suit involves a determination of the correct tax treatment of certain leveraged leases entered into by the Company. The outcome of this litigation will likely impact a number of leveraged leases we entered into during 1997 through 2004. After a jury trial, the jury rendered a verdict in the form of answers to interrogatories, some of which favored Fifth Third and some of which favored the IRS. No judgment has been entered by the Court in the case and the parties dispute the judgment that should be entered in light of the jury’s responses to the interrogatories. Both the IRS and Fifth Third will be filing briefs, after which the Court will enter a judgment. The nature and timing of the Court’s decision is uncertain. During the second quarter of 2008, two other decisions involving the tax treatment of leveraged leases were issued where the courts ruled in favor of the IRS. To date, the decisions issued have been dependent on the specific facts in each case. We continue to believe that the facts and circumstances related to our leveraged leases are different from these other cases, that our tax treatment was proper under the tax law as it existed at the time the tax benefits were reported, and that the facts in our case support our position. We are required under applicable accounting standards to assess the likeliness of a favorable outcome of this litigation. In light of recent decisions and uncertainty related to our own case, we have concluded that previously recognized benefits from the transactions at issue in the litigation and certain other leveraged leases described above must be remeasured as required by FIN 48 and have recorded the charges described earlier. We believe these charges address the downside risk we have related to leveraged leases should there be a negative outcome in our case. We intend to continue pursuing a favorable disposition of this matter.

On May 5, 2008, we completed our acquisition of nine branches from First Horizon National Corporation, assuming their deposits. First Horizon retained all loans held at the branches. Additionally, on June 6, 2008, we completed our acquisition of First Charter Corporation, paying $31.00 per First Charter share, or approximately $1.1 billion. This transaction reduced tangible equity capital ratios by approximately 65 bps.

Outlook

The following outlook represents currently expected full year 2008 growth rates compared with full year 2007 results. Note that the current outlook includes the effect of the second quarter acquisitions of First Charter and branches from First Horizon, not previously included in the outlook. Our outlook is based on current expectations as of the date of this release for results within our businesses; prevailing views related to economic growth, inflation, unemployment and other economic factors, and market forward interest rate expectations. These expectations are inherently subject to risks and uncertainties. There are a number of factors that could cause results to differ materially from historical performance and these expectations,

including the effects of unusually high market volatility and factors contributing to industry-wide and company-specific credit losses. We undertake no obligation to update these expectations after the date of this release. Please refer to the forward-looking statement at the end of this release for important information regarding risk factors related to current and future results.


Category		Growth, percentage, or bps range
Net interest income#		Mid-teens

Net interest margin		3.50-3.60%

Noninterest income*		Low-to-mid teens

Noninterest expense**		10-12%

Average loans		High single digits

Average core deposits		Mid single digits

Net charge-offs		160-170 bps range

Allowance for loan loss reserve/loans		>2 percent by year-end***

Effective tax rate [non-tax equivalent]#		Approximately 27-28 percent

Tangible equity/tangible asset ratio		Target 6-7%

Tier 1 capital ratio		Target 8-9%

Total capital ratio		Target 11.5-12.5%

^#	comparison with 2007 excludes second quarter 2008 charges related to leveraged lease litigation ($130 million pre-tax in net interest income and $140 million in pre- and after-tax charges in tax expense).

*	comparison with 2007 excludes $273 million in first quarter 2008 gains related to Visa’s IPO and non-cash charges to lower the cash surrender value of one of our BOLI policies of an estimated $152 million in the first quarter of 2008 and $177 million in the fourth quarter of 2007

comparison with 2007 excludes $152 million in reversals of litigation reserves in first quarter 2008 related to Visa’s IPO, $20 million in merger-related charges in first and second quarters 2008, $9 million in severance expenses in the first quarter of 2008, and, in 2007, $172 million for charges in potential future Visa litigation settlements and $8 million of acquisition-related expenses

***	subject to loan loss allowance model.

Conference Call

Fifth Third will host a conference call to discuss these financial results at 8:30 a.m. (Eastern Time) today. This conference call will be webcast live by Thomson Financial and may be accessed through the Fifth Third Investor Relations website at www.53.com (click on “About Fifth Third” then “Investor Relations”). The webcast also is being distributed over Thomson Financial’s Investor Distribution Network to both institutional and individual investors. Individual investors can listen to the call through Thomson Financial’s individual investor center at www.earnings.com or by visiting any of the investor sites in Thomson Financial’s Individual Investor Network. Institutional investors can access the call via Thomson Financial’s password-protected event management site, StreetEvents (www.streetevents.com).

Those unable to listen to the live webcast may access a webcast replay or podcast through the Fifth Third Investor Relations website at the same web address. Additionally, a telephone replay of the conference call

will be available beginning approximately two hours after the conference call until Tuesday, August 4th by dialing 800-642-1687 for domestic access and 706-645-9291 for international access (passcode 50436837#).

Corporate Profile

Fifth Third Bancorp is a diversified financial services company headquartered in Cincinnati, Ohio. As of June 30, 2008, the Company has $115 billion in assets, operates 18 affiliates with 1,308 full-service Banking Centers, including 97 Bank Mart^® locations open seven days a week inside select grocery stores and 2,329 ATMs in Ohio, Kentucky, Indiana, Michigan, Illinois, Florida, Tennessee, West Virginia, Pennsylvania, Missouri, Georgia and North Carolina. Fifth Third operates five main businesses: Commercial Banking, Branch Banking, Consumer Lending, Investment Advisors and Fifth Third Processing Solutions. Fifth Third is among the largest money managers in the Midwest and, as of June 30, 2008, has $207 billion in assets under care, of which it managed $31 billion for individuals, corporations and not-for-profit organizations. Investor information and press releases can be viewed atwww.53.com. Fifth Third’s common stock is traded on the NASDAQ^® National Global Select Market under the symbol “FITB.”

FORWARD-LOOKING STATEMENTS

This report may contain forward-looking statements about Fifth Third Bancorp and/or the company as combined acquired entities within the meaning of Sections 27A of the Securities Act of 1933, as amended, and Rule 175 promulgated thereunder, and 21E of the Securities Exchange Act of 1934, as amended, and Rule 3b-6 promulgated thereunder, that involve inherent risks and uncertainties. This report may contain certain forward-looking statements with respect to the financial condition, results of operations, plans, objectives, future performance and business of Fifth Third Bancorp and/or the combined company including statements preceded by, followed by or that include the words or phrases such as “believes,” “expects,” “anticipates,” “plans,” “trend,” “objective,” “continue,” “remain” or similar expressions or future or conditional verbs such as “will,” “would,” “should,” “could,” “might,” “can,” “may” or similar expressions. There are a number of important factors that could cause future results to differ materially from historical performance and these forward-looking statements. Factors that might cause such a difference include, but are not limited to: (1) general economic conditions and weakening in the economy, specifically the real estate market, either national or in the states in which Fifth Third, one or more acquired entities and/or the combined company do business, are less favorable than expected; (2) deteriorating credit quality; (3) political developments, wars or other hostilities may disrupt or increase volatility in securities markets or other economic conditions; (4) changes in the interest rate environment reduce interest margins; (5) prepayment speeds, loan origination and sale volumes, charge-offs and loan loss provisions; (6) Fifth Third’s ability to maintain required capital levels and adequate sources of funding and liquidity; (7) changes and trends in capital markets; (8) competitive pressures among depository institutions increase significantly; (9) effects of critical accounting policies and judgments; (10) changes in accounting policies or procedures as may be required by the Financial Accounting Standards Board or other regulatory agencies; (11) legislative or regulatory changes or actions, or significant litigation, adversely affect Fifth Third, one or more acquired entities and/or the combined company or the businesses in which Fifth Third, one or more acquired entities and/or the combined company are engaged; (12) ability to maintain favorable ratings from rating agencies; (13) fluctuation of Fifth Third’s stock price; (14) ability to attract and retain key personnel; (15) ability to receive dividends from its subsidiaries; (16) potentially dilutive effect of future acquisitions on current shareholders’ ownership of Fifth Third; (17) effects of accounting or financial results of one or more acquired entities; (18) difficulties in combining the operations of acquired entities;(19) inability to generate the gains on sale and related increase in shareholders’ equity that it anticipates from the sale of certain non-corebusinesses, (20) loss of income from the sale of certain non-core businesses could have an adverse effect on Fifth Third’s earnings and future growth (21) ability to secure confidential information through the use of computer systems and telecommunications networks; and (22) the impact of reputational risk created by these developments on such matters as business generation and retention, funding and liquidity. Additional information concerning factors that could cause actual results to differ materially from those expressed or implied in the forward-looking statements is available in the Bancorp’s Annual Report on Form 10-K for the year ended December 31, 2007, filed with the United States Securities and Exchange Commission (SEC). Copies of this filing are available at no cost on the SEC’s Web site at www.sec.gov or on the Fifth Third’s Web site at www.53.com. Fifth Third undertakes no obligation to release revisions to these forward-looking statements or reflect events or circumstances after the date of this report.

# # #

LOGO

Quarterly Financial Review for June 30, 2008

Table of Contents


Financial Highlights		16-17
Consolidated Statements of Income		18
Consolidated Statements of Income (Taxable Equivalent)		19
Consolidated Balance Sheets		20-21
Consolidated Statements of Changes in Shareholders’ Equity		22
Average Balance Sheet and Yield Analysis		23-25
Summary of Loans and Leases		26
Regulatory Capital		27
Summary of Credit Loss Experience		28
Asset Quality		29
Segment Presentation		30

Fifth Third Bancorp and Subsidiaries

Financial Highlights

$ in millions, except per share data

(unaudited)


	For the Three Months Ended									% Change				Year to Date						% Change
	June 2008			March 2008			June 2007			Seq		Yr/Yr		June 2008			June 2007			Yr/Yr
Income Statement Data
Net interest income (a)	$	744		$	826		$	745		(10	%)	—		$	1,570		$	1,487		6	%
Noninterest income		722			864			669		(16	%)	8	%		1,587			1,277		24	%
Total revenue (a)		1,466			1,690			1,414		(13	%)	4	%		3,157			2,764		14	%
Provision for loan and lease losses		719			544			121		32	%	492	%		1,263			205		515	%
Noninterest expense		858			715			765		20	%	12	%		1,576			1,517		4	%
Net income (loss)		(202	)		286			376		NM		NM			84			735		(89	%)
Common Share Data
Earnings per share, basic		($0.37	)	$	0.54		$	0.69		NM		NM		$	0.16		$	1.35		(88	%)
Earnings per share, diluted		(0.37	)		0.54			0.69		NM		NM			0.16			1.34		(88	%)
Cash dividends per common share	$	0.15		$	0.44		$	0.42		(66	%)	(64	%)	$	0.59		$	0.84		(30	%)
Book value per share		18.62			17.57			17.16		6	%	9	%		18.62			17.16		9	%
Dividend payout ratio		(42.7	%)		81.8	%		59.7	%	NM		NM			380.0	%		62.0	%	513	%
Market price per share		10.18			20.92			39.77		(51	%)	(74	%)		10.18			39.77		(74	%)
Common shares outstanding (in thousands)		577,530			532,106			535,697		9	%	8	%		577,530			535,697		8	%
Average common shares outstanding (in thousands):
Basic		540,030			528,498			540,264		2	%	—			534,264			545,851		(2	%)
Diluted		540,030			530,372			543,228		2	%	(1	%)		542,722			548,671		(1	%)
Market capitalization	$	5,879		$	11,132		$	21,305		(47	%)	(72	%)	$	5,879		$	21,305		(72	%)
Price/earnings ratio (b)		11.98			11.19			18.58		7	%	(36	%)		11.98			18.58		(36	%)
Financial Ratios
Return on average assets		(0.73	%)		1.03	%		1.49	%	NM		NM			0.15	%		1.48	%	(90	%)
Return on average equity		(8.4	%)		12.3	%		15.7	%	NM		NM			1.8	%		15.1	%	(88	%)
Noninterest income as a percent of total revenue		49	%		51	%		47	%	(4	%)	4	%		50	%		46	%	9	%
Average equity as a percent of average assets		8.59	%		8.43	%		9.53	%	2	%	(10	%)		8.51	%		9.78	%	(13	%)
Tangible equity (c)		6.37	%		6.19	%		7.18	%	3	%	(11	%)		6.37	%		7.18	%	(11	%)
Tangible common equity		5.40	%		6.19	%		7.17	%	(13	%)	(25	%)		5.40	%		7.17	%	(25	%)
Net interest margin (a)		3.04	%		3.41	%		3.37	%	(11	%)	(10	%)		3.22	%		3.40	%	(5	%)
Efficiency (a)		58.6	%		42.3	%		54.1	%	39	%	8	%		49.9	%		54.9	%	(9	%)
Effective tax rate		(72.4	%)		32.6	%		28.1	%	NM		NM			72.6	%		28.7	%	153	%
Credit Quality
Net losses charged off	$	344		$	276		$	102		25	%	237	%	$	620		$	173		258	%
Net losses charged off as a percent of average loans and leases		1.66	%		1.37	%		0.55	%	21	%	202	%		1.52	%		0.47	%	223	%
Allowance for loan and lease losses as a percent of loans and leases		1.85	%		1.49	%		1.06	%	24	%	75	%		1.85	%		1.06	%	75	%
Allowance for credit losses as a percent of loans and leases		1.98	%		1.62	%		1.16	%	22	%	71	%		1.98	%		1.16	%	71	%
Nonperforming assets as a percent of loans, leases and other assets, including other real estate owned		2.56	%		1.96	%		0.70	%	31	%	266	%		2.56	%		0.70	%	266	%
Average Balances
Loans and leases, including held for sale	$	85,212		$	84,912		$	77,048		—		11	%	$	85,062		$	76,457		11	%
Total securities and other short-term investments		13,363			12,597			11,741		6	%	14	%		12,980			11,726		11	%
Total assets		112,098			111,291			100,767		1	%	11	%		111,694			99,984		12	%
Transaction deposits (e)		53,763			53,458			50,932		1	%	6	%		53,610			50,520		6	%
Core deposits (f)		63,280			64,342			61,712		(2	%)	3	%		63,811			61,428		4	%
Wholesale funding (g)		35,160			33,219			25,393		6	%	38	%		34,189			24,796		38	%
Shareholders’ equity		9,629			9,379			9,599		3	%	—			9,504			9,783		(3	%)
Regulatory Capital Ratios (d)
Tier I capital		8.51	%		7.72	%		8.13	%	10	%	5	%		8.51	%		8.13	%	5	%
Total risk-based capital		12.15	%		11.34	%		10.54	%	7	%	15	%		12.15	%		10.54	%	15	%
Tier I leverage		9.08	%		8.28	%		8.76	%	10	%	4	%		9.08	%		8.76	%	4	%
Operations
Banking centers		1,308			1,232			1,167		6	%	12	%		1,308			1,167		12	%
ATMs		2,329			2,221			2,132		5	%	9	%		2,329			2,132		9	%
Full-time equivalent employees		21,617			21,726			21,033		(1	%)	3	%		21,617			21,033		3	%

(a)	Presented on a fully taxable equivalent basis

(b)	Based on the most recent twelve-month diluted earnings per share and end of period stock prices

(c)	Total assets and total shareholders’ equity are reduced by goodwill, intangibles and accumulated other comprehensive income to calculate tangible equity

(d)	Current period regulatory capital ratios are estimates

(e)	Includes demand, interest checking, savings, money market and foreign office deposits of commercial customers

(f)	Includes transaction deposits plus other time deposits

(g)	Includes certificates $100,000 and over, other foreign office deposits, federal funds purchased, short-term borrowings and long-term debt

Fifth Third Bancorp and Subsidiaries

Financial Highlights

$ in millions, except per share data

(unaudited)


	For the Three Months Ended
	June 2008			March 2008			December 2007			September 2007			June 2007
Income Statement Data
Net interest income (a)	$	744		$	826		$	785		$	760		$	745
Noninterest income		722			864			509			681			669
Total revenue (a)		1,466			1,690			1,294			1,441			1,414
Provision for loan and lease losses		719			544			284			139			121
Noninterest expense		858			715			940			853			765
Net income (loss)		(202	)		286			16			325			376
Common Share Data
Earnings per share, basic		($0.37	)	$	0.54		$	0.03		$	0.61		$	0.69
Earnings per share, diluted		(0.37	)		0.54			0.03			0.61			0.69
Cash dividends per common share	$	0.15		$	0.44		$	0.44		$	0.42		$	0.42
Book value per share		18.62			17.57			17.20			17.45			17.16
Dividend payout ratio		(42.7	%)		81.8	%		1,435.0	%		68.7	%		59.7	%
Market price per share		10.18			20.92			25.13			33.88			39.77
Common shares outstanding (in thousands)		577,530			532,106			532,672			532,627			535,697
Average common shares outstanding (in thousands):
Basic		540,030			528,498			529,120			530,123			540,264
Diluted		540,030			530,372			530,939			532,471			543,228
Market capitalization	$	5,879		$	11,132		$	13,386		$	18,045		$	21,305
Price/earnings ratio (b)		11.98			11.19			12.69			16.37			18.58
Financial Ratios
Return on average assets		(0.73	%)		1.03	%		0.06	%		1.26	%		1.49	%
Return on average equity		(8.4	%)		12.3	%		0.7	%		13.8	%		15.7	%
Noninterest income as a percent of total revenue		49	%		51	%		39	%		47	%		47	%
Average equity as a percent of average assets		8.59	%		8.43	%		8.77	%		9.13	%		9.53	%
Tangible equity (c)		6.37	%		6.19	%		6.14	%		7.00	%		7.18	%
Tangible common equity		5.40	%		6.19	%		6.14	%		6.99	%		7.17	%
Net interest margin (a)		3.04	%		3.41	%		3.29	%		3.34	%		3.37	%
Efficiency (a)		58.6	%		42.3	%		72.6	%		59.2	%		54.1	%
Effective tax rate		(72.4	%)		32.6	%		74.5	%		26.7	%		28.1	%
Credit Quality
Net losses charged off	$	344		$	276		$	174		$	115		$	102
Net losses charged off as a percent of average loans and leases		1.66	%		1.37	%		0.89	%		0.60	%		0.55	%
Allowance for loan and lease losses as a percent of loans and leases		1.85	%		1.49	%		1.17	%		1.08	%		1.06	%
Allowance for credit losses as a percent of loans and leases		1.98	%		1.62	%		1.29	%		1.19	%		1.16	%
Nonperforming assets as a percent of loans, leases and other assets, including other real estate owned		2.56	%		1.96	%		1.32	%		0.92	%		0.70	%
Average Balances
Loans and leases, including held for sale	$	85,212		$	84,912		$	82,172		$	78,243		$	77,048
Total securities and other short-term investments		13,363			12,597			12,506			12,169			11,741
Total assets		112,098			111,291			107,727			102,131			100,767
Transaction deposits (e)		53,763			53,458			51,967			50,922			50,932
Core deposits (f)		63,280			64,342			62,978			61,212			61,712
Wholesale funding (g)		35,160			33,219			31,344			28,001			25,393
Shareholders’ equity		9,629			9,379			9,446			9,324			9,599
Regulatory Capital Ratios (d)
Tier I capital		8.51	%		7.72	%		7.72	%		8.46	%		8.13	%
Total risk-based capital		12.15	%		11.34	%		10.16	%		10.87	%		10.54	%
Tier I leverage		9.08	%		8.28	%		8.50	%		9.23	%		8.76	%
Operations
Banking centers		1,308			1,232			1,227			1,181			1,167
ATMs		2,329			2,221			2,211			2,153			2,132
Full-time equivalent employees		21,617			21,726			21,683			20,775			21,033

(a)	Presented on a fully taxable equivalent basis

(b)	Based on the most recent twelve-month diluted earnings per share and end of period stock prices

(c)	Total assets and total shareholders’ equity are reduced by goodwill, intangibles and accumulated other comprehensive income to calculate tangible equity

(d)	Current period regulatory capital ratios are estimates

(e)	Includes demand, interest checking, savings, money market and foreign office deposits of commercial customers

(f)	Includes transaction deposits plus other time deposits

(g)	Includes certificates $100,000 and over, other foreign office deposits, federal funds purchased, short-term borrowings and long-term debt

Fifth Third Bancorp and Subsidiaries

Consolidated Statements of Income

$ in millions

(unaudited)


	For the Three Months Ended							% Change				Year to Date				% Change
	June 2008			March 2008		June 2007		Seq		Yr/Yr		June 2008		June 2007		Yr/Yr
Interest Income
Interest and fees on loans and leases	$	1,050		$	1,290	$	1,343	(19	%)	(22	%)	$	2,340	$	2,657	(12	%)
Interest on securities		155			152		143	2	%	8	%		307		286	7	%
Interest on other short-term investments		2			5		3	(52	%)	(10	%)		7		6	25	%

Total interest income		1,207			1,447		1,489	(17	%)	(19	%)		2,654		2,949	(10	%)
Interest Expense
Interest on deposits		278			399		505	(30	%)	(45	%)		677		1,003	(33	%)
Interest on short-term borrowings		49			80		72	(39	%)	(32	%)		129		131	(2	%)
Interest on long-term debt		142			148		173	(4	%)	(18	%)		289		340	(15	%)

Total interest expense		469			627		750	(25	%)	(37	%)		1,095		1,474	(26	%)

Net Interest Income		738			820		739	(10	%)	—			1,559		1,475	6	%
Provision for loan and lease losses		719			544		121	32	%	492	%		1,263		205	515	%

Net interest income after provision for loan and lease losses		19			276		618	(93	%)	(97	%)		296		1,270	(77	%)
Noninterest Income
Electronic payment processing revenue		235			213		205	10	%	15	%		447		390	15	%
Service charges on deposits		159			147		142	8	%	12	%		307		268	14	%
Investment advisory revenue		92			93		97	(1	%)	(5	%)		185		193	(4	%)
Corporate banking revenue		111			107		88	3	%	26	%		218		171	28	%
Mortgage banking net revenue		86			97		41	(11	%)	108	%		182		81	126	%
Other noninterest income		49			177		96	(72	%)	(49	%)		228		174	31	%
Securities gains (losses), net		(10	)		27		—	NM		NM			17		—	NM
Securities gains, net - non-qualifying hedges on mortgage servicing rights		—			3		—	(100	%)	NM			3		—	NM

Total noninterest income		722			864		669	(16	%)	8	%		1,587		1,277	24	%
Noninterest Expense
Salaries, wages and incentives		331			347		309	(5	%)	7	%		679		601	13	%
Employee benefits		60			85		68	(29	%)	(11	%)		145		155	(7	%)
Payment processing expense		67			66		59	2	%	14	%		133		111	20	%
Net occupancy expense		73			72		68	2	%	8	%		145		133	9	%
Technology and communications		49			47		41	3	%	18	%		96		81	18	%
Equipment expense		31			31		31	—		—			61		60	2	%
Other noninterest expense		247			67		189	269	%	31	%		317		376	(16	%)

Total noninterest expense		858			715		765	20	%	12	%		1,576		1,517	4	%
Income (loss) before income taxes		(117	)		425		522	NM		NM			307		1,030	(70	%)
Applicable income taxes		85			139		146	(39	%)	(42	%)		223		295	(24	%)

Net income (loss)		($202	)	$	286	$	376	NM		NM		$	84	$	735	(89	%)

Net income (loss) available to common shareholders		(202	)		286		375	NM		NM			84		734	(89	%)

(a)	Dividends on preferred stock are $.185 million for all quarters presented

Fifth Third Bancorp and Subsidiaries

Consolidated Statements of Income (Taxable Equivalent)

$ in millions

(unaudited)


	For the Three Months Ended
	June 2008			March 2008		December 2007			September 2007		June 2007
Interest Income
Interest and fees on loans and leases	$	1,050		$	1,290	$	1,386		$	1,376	$	1,343
Interest on securities		155			152		157			147		143
Interest on other short-term investments		2			5		7			6		3

Total interest income		1,207			1,447		1,550			1,529		1,489
Taxable equivalent adjustment		6			6		6			6		6

Total interest income (taxable equivalent)		1,213			1,453		1,556			1,535		1,495
Interest Expense
Interest on deposits		278			399		493			511		505
Interest on short-term borrowings		49			80		100			93		72
Interest on long-term debt		142			148		178			171		173

Total interest expense		469			627		771			775		750

Net interest income (taxable equivalent)		744			826		785			760		745
Provision for loan and lease losses		719			544		284			139		121

Net interest income (taxable equivalent) after provision for loan and lease losses		25			282		501			621		624
Noninterest Income
Electronic payment processing revenue		235			213		223			212		205
Service charges on deposits		159			147		160			151		142
Investment advisory revenue		92			93		94			95		97
Corporate banking revenue		111			107		106			91		88
Mortgage banking net revenue		86			97		26			26		41
Other noninterest income		49			177		(113	)		93		96
Securities gains (losses), net		(10	)		27		7			13		—
Securities gains, net - non-qualifying hedges on mortgage servicing rights		—			3		6			—		—

Total noninterest income		722			864		509			681		669
Noninterest Expense
Salaries, wages and incentives		331			347		328			310		309
Employee benefits		60			85		56			67		68
Payment processing expense		67			66		68			65		59
Net occupancy expense		73			72		70			66		68
Technology and communications		49			47		47			41		41
Equipment expense		31			31		32			30		31
Other noninterest expense		247			67		339			274		189

Total noninterest expense		858			715		940			853		765

Income (loss) before income taxes (taxable equivalent)		(111	)		431		70			449		528
Taxable equivalent adjustment		6			6		6			6		6

Income (loss) before income taxes		(117	)		425		64			443		522
Applicable income taxes		85			139		48			118		146

Net income (loss)		($202)		$	286	$	16		$	325	$	376

Net income (loss) available to common shareholders (a)		($202)		$	286	$	16		$	325	$	375

(a)	Dividends on preferred stock are $.185 million for all quarters presented

Fifth Third Bancorp and Subsidiaries

Consolidated Balance Sheets

$ in millions, except per share data

(unaudited)


	As of									% Change
	June 2008			March 2008			June 2007			Seq		Yr/Yr
Assets
Cash and due from banks	$	2,853		$	3,092		$	2,294		(8	%)	24	%
Available-for-sale and other securities (a)		12,718			12,421		��	11,015		2	%	15	%
Held-to-maturity securities (b)		361			353			346		2	%	4	%
Trading securities		241			184			148		31	%	63	%
Other short-term investments		286			517			437		(45	%)	(35	%)
Loans held for sale		889			2,573			1,708		(65	%)	(48	%)
Portfolio loans and leases:
Commercial loans		28,958			26,590			22,152		9	%	31	%
Commercial mortgage loans		13,394			12,155			11,044		10	%	21	%
Commercial construction loans		6,007			5,592			5,469		7	%	10	%
Commercial leases		3,647			3,727			3,697		(2	%)	(1	%)
Residential mortgage loans		9,866			9,873			8,477		—		16	%
Home equity		12,421			11,803			11,780		5	%	5	%
Automobile loans		8,362			8,394			10,714		—		(22	%)
Credit card		1,717			1,686			1,263		2	%	36	%
Other consumer loans and leases		1,152			1,066			1,113		8	%	4	%

Portfolio loans and leases		85,524			80,886			75,709		6	%	13	%
Allowance for loan and lease losses		(1,580	)		(1,205	)		(803	)	31	%	97	%

Portfolio loans and leases, net		83,944			79,681			74,906		5	%	12	%
Bank premises and equipment		2,444			2,265			2,063		8	%	18	%
Operating lease equipment		364			317			209		15	%	74	%
Goodwill		3,603			2,460			2,192		46	%	64	%
Intangible assets		203			143			147		42	%	38	%
Servicing rights		701			596			607		18	%	16	%
Other assets		6,368			6,794			5,318		(6	%)	20	%

Total assets	$	114,975		$	111,396		$	101,390		3	%	13	%

Liabilities
Deposits:
Demand	$	16,259		$	14,949		$	13,524		9	%	20	%
Interest checking		14,002			14,842			14,672		(6	%)	(5	%)
Savings		16,602			16,572			15,036		—		10	%
Money market		6,806			7,077			6,334		(4	%)	7	%
Foreign office		2,174			2,354			1,744		(8	%)	25	%
Other time		9,839			9,883			10,428		—		(6	%)
Certificates - $100,000 and over		10,870			4,993			6,204		118	%	75	%
Other foreign office		864			731			1,251		18	%	(31	%)

Total deposits		77,416			71,401			69,193		8	%	12	%
Federal funds purchased		2,447			5,612			3,824		(56	%)	(36	%)
Other short-term borrowings		5,628			6,387			3,331		(12	%)	69	%
Accrued taxes, interest and expenses		1,864			2,377			2,114		(22	%)	(12	%)
Other liabilities		1,820			2,226			1,780		(18	%)	2	%
Long-term debt		15,046			14,041			11,957		7	%	26	%

Total liabilities		104,221			102,044			92,199		2	%	13	%
Total shareholders’ equity (c)		10,754			9,352			9,191		15	%	17	%

Total liabilities and shareholders’ equity	$	114,975		$	111,396		$	101,390		3	%	13	%

(a) Amortized cost	$	12,935		$	12,417		$	11,370		4	%	14	%
(b) Market values		361			353			346		2	%	4	%
(c) Common shares, stated value $2.22 per share (in thousands):
Authorized		2,000,000			1,300,000			1,300,000		54	%	54	%
Outstanding, excluding treasury		577,530			532,106			535,697		9	%	8	%
Treasury		5,897			51,321			47,730		(89	%)	(88	%)

Fifth Third Bancorp and Subsidiaries

Consolidated Balance Sheets

$ in millions, except per share data

(unaudited)


	As of
	June 2008			March 2008			December 2007			September 2007			June 2007
Assets
Cash and due from banks	$	2,853		$	3,092		$	2,660		$	2,494		$	2,294
Available-for-sale and other securities (a)		12,718			12,421			10,677			10,777			11,015
Held-to-maturity securities (b)		361			353			355			346			346
Trading securities		241			184			171			155			148
Other short-term investments		286			517			620			765			437
Loans held for sale		889			2,573			4,329			2,761			1,708
Portfolio loans and leases:
Commercial loans		28,958			26,590			24,813			22,649			22,152
Commercial mortgage loans		13,394			12,155			11,862			11,090			11,044
Commercial construction loans		6,007			5,592			5,561			5,463			5,469
Commercial leases		3,647			3,727			3,737			3,710			3,697
Residential mortgage loans		9,866			9,873			10,540			9,057			8,477
Home equity		12,421			11,803			11,874			11,737			11,780
Automobile loans		8,362			8,394			9,201			10,006			10,714
Credit card		1,717			1,686			1,591			1,460			1,263
Other consumer loans and leases		1,152			1,066			1,074			1,082			1,113

Portfolio loans and leases		85,524			80,886			80,253			76,254			75,709
Allowance for loan and lease losses		(1,580	)		(1,205	)		(937	)		(827	)		(803	)

Portfolio loans and leases, net		83,944			79,681			79,316			75,427			74,906
Bank premises and equipment		2,444			2,265			2,223			2,127			2,063
Operating lease equipment		364			317			353			283			209
Goodwill		3,603			2,460			2,470			2,192			2,192
Intangible assets		203			143			147			138			147
Servicing rights		701			596			618			626			607
Other assets		6,368			6,794			7,023			6,174			5,318

Total assets	$	114,975		$	111,396		$	110,962		$	104,265		$	101,390

Liabilities
Deposits:
Demand	$	16,259		$	14,949		$	14,404		$	13,174		$	13,524
Interest checking		14,002			14,842			15,254			14,294			14,672
Savings		16,602			16,572			15,635			15,599			15,036
Money market		6,806			7,077			6,521			6,163			6,334
Foreign office		2,174			2,354			2,572			2,014			1,744
Other time		9,839			9,883			11,440			10,267			10,428
Certificates - $100,000 and over		10,870			4,993			6,738			5,973			6,204
Other foreign office		864			731			2,881			1,898			1,251

Total deposits		77,416			71,401			75,445			69,382			69,193
Federal funds purchased		2,447			5,612			4,427			5,130			3,824
Other short-term borrowings		5,628			6,387			4,747			3,796			3,331
Accrued taxes, interest and expenses		1,864			2,377			2,427			2,295			2,114
Other liabilities		1,820			2,226			1,898			1,871			1,780
Long-term debt		15,046			14,041			12,857			12,498			11,957

Total liabilities		104,221			102,044			101,801			94,972			92,199
Total shareholders’ equity (c)		10,754			9,352			9,161			9,293			9,191

Total liabilities and shareholders’ equity	$	114,975		$	111,396		$	110,962		$	104,265		$	101,390

(a) Amortized cost	$	12,935		$	12,417		$	10,821		$	11,007		$	11,370
(b) Market values		361			353			355			346			346
(c) Common shares, stated value $2.22 per share (in thousands):
Authorized		2,000,000			1,300,000			1,300,000			1,300,000			1,300,000
Outstanding, excluding treasury		577,530			532,106			532,672			532,627			535,697
Treasury		5,897			51,321			51,516			50,800			47,730

Fifth Third Bancorp and Subsidiaries

Consolidated Statements of Changes in Shareholders’ Equity

$ in millions

(unaudited)


	For the Three Months Ended						Year to Date
	June 2008			June 2007			June 2008			June 2007
Total shareholders’ equity, beginning	$	9,352		$	9,804		$	9,161		$	10,022
Net income (loss)		(202	)		376			84			735
Other comprehensive income, net of tax:
Change in unrealized gains and (losses):
Available-for-sale securities		(134	)		(125	)		(38	)		(111	)
Qualifying cash flow hedges		(30	)		(7	)		9			(7	)
Change in accumulated other comprehensive income related to employee benefit plans		1			2			3			3

Comprehensive income		(365	)		246			58			620
Cash dividends declared:
Common stock		(87	)		(225	)		(321	)		(456	)
Preferred stock (a)		—			—			—			—
Issuance of preferred stock		1,072			—			1,072			—
Stock-based awards exercised, including treasury shares issued		(2	)		27			—			45
Stock-based compensation expense		15			18			28			35
Loans repaid (issued) related to exercise of stock-based awards, net		4			—			2			2
Change in corporate tax benefit related to stock-based compensation		(5	)		8			(15	)		3
Shares issued in an acquisition		770			—			770			—
Shares acquired for treasury		—			(693	)		—			(973	)
Impact of cumulative effect of change in accounting principle (b)		—			—			—			(98	)
Other		—			6			(1	)		(9	)

Total shareholders’ equity, ending	$	10,754		$	9,191		$	10,754		$	9,191

(a)	Dividends on preferred stock are $.185 million for all quarters presented

(b)

2007 includes $96 million impact due to the adoption of FSP FAS 13-2, “Accounting for a Change or Projected Change in the Timing of Cash Flows Relating to Income Taxes Generated by a Leverage Lease Transaction” on January 1, 2007 and $2 million impact due to the adoption of FIN No. 48, “Accounting for Uncertainty in Income Taxes—An Interpretation of FASB Statement No. 109” on January 1, 2007.

Fifth Third Bancorp and Subsidiaries

Average Balance Sheet and Yield Analysis

$ in millions, except share data

(unaudited)


	For the Three Months Ended									% Change
	June 2008			March 2008			June 2007			Seq		Yr/Yr
Assets
Interest-earning assets:
Commercial loans	$	28,557		$	26,617		$	21,587		7	%	32	%
Commercial mortgage loans		12,590			12,052			11,030		4	%	14	%
Commercial construction loans		5,700			5,577			5,595		2	%	2	%
Commercial leases		3,747			3,723			3,678		1	%	2	%
Residential mortgage loans		11,244			11,699			10,201		(4	%)	10	%
Home equity		12,012			11,846			11,886		1	%	1	%
Automobile loans		8,439			10,542			10,552		(20	%)	(20	%)
Credit card		1,703			1,660			1,248		3	%	36	%
Other consumer loans and leases		1,220			1,196			1,271		2	%	(4	%)
Taxable securities		12,554			11,560			11,030		9	%	14	%
Tax exempt securities		364			403			508		(10	%)	(28	%)
Other short-term investments		445			634			203		(30	%)	119	%

Total interest-earning assets		98,575			97,509			88,789		1	%	11	%
Cash and due from banks		2,357			2,236			2,235		5	%	5	%
Other assets		12,370			12,477			10,524		(1	%)	18	%
Allowance for loan and lease losses		(1,204	)		(931	)		(781	)	29	%	54	%

Total assets	$	112,098		$	111,291		$	100,767		1	%	11	%

Liabilities
Interest-bearing liabilities:
Interest checking	$	14,396		$	14,836		$	15,061		(3	%)	(4	%)
Savings		16,583			16,075			14,620		3	%	13	%
Money market		6,592			6,896			6,244		(4	%)	6	%
Foreign office		2,169			2,443			1,637		(11	%)	33	%
Other time		9,517			10,884			10,780		(13	%)	(12	%)
Certificates - $100,000 and over		8,143			5,835			6,511		40	%	25	%
Other foreign office		2,948			3,861			732		(24	%)	303	%
Federal funds purchased		3,643			5,258			3,540		(31	%)	3	%
Other short-term borrowings		5,623			4,937			2,372		14	%	137	%
Long-term debt		14,803			13,328			12,238		11	%	21	%

Total interest-bearing liabilities		84,417			84,353			73,735		—		14	%
Demand deposits		14,023			13,208			13,370		6	%	5	%
Other liabilities		4,029			4,351			4,063		(7	%)	(1	%)

Total liabilities		102,469			101,912			91,168		1	%	12	%
Shareholders’ equity		9,629			9,379			9,599		3	%	—

Total liabilities and shareholders’ equity	$	112,098		$	111,291		$	100,767		1	%	11	%

Yield Analysis
Interest-earning assets:
Commercial loans		5.04	%		5.99	%		7.45	%
Commercial mortgage loans		5.93	%		6.28	%		7.30	%
Commercial construction loans		5.44	%		5.64	%		7.69	%
Commercial leases		-9.77	%		4.30	%		4.32	%
Residential mortgage loans		6.10	%		6.14	%		6.12	%
Home equity		5.61	%		6.46	%		7.66	%
Automobile loans		6.23	%		6.41	%		6.25	%
Credit card		9.28	%		9.15	%		10.62	%
Other consumer loans and leases		4.97	%		5.52	%		5.48	%

Total loans and leases		4.97	%		6.13	%		7.01	%
Taxable securities		4.83	%		5.13	%		4.98	%
Tax exempt securities		7.32	%		7.31	%		7.38	%
Other short-term investments		2.12	%		3.08	%		5.18	%

Total interest-earning assets		4.95	%		5.99	%		6.75	%
Interest-bearing liabilities:
Interest checking		0.78	%		1.44	%		2.21	%
Savings		1.16	%		1.81	%		3.23	%
Money market		1.76	%		2.74	%		4.44	%
Foreign office		1.42	%		2.48	%		4.38	%
Other time		3.52	%		4.30	%		4.63	%
Certificates - $100,000 and over		3.29	%		4.44	%		5.12	%
Other foreign office		2.10	%		3.22	%		5.31	%
Federal funds purchased		2.08	%		3.26	%		5.31	%
Other short-term borrowings		2.15	%		3.02	%		4.31	%
Long-term debt		3.85	%		4.48	%		5.65	%

Total interest-bearing liabilities		2.23	%		2.99	%		4.08	%
Ratios:
Net interest margin (taxable equivalent)		3.04	%		3.41	%		3.37	%
Net interest rate spread (taxable equivalent)		2.72	%		3.00	%		2.67	%
Interest-bearing liabilities to interest-earning assets		85.64	%		86.51	%		83.05	%

Fifth Third Bancorp and Subsidiaries

Average Balance Sheet and Yield Analysis

$ in millions, except share data

(unaudited)


	Year to Date						% Change
	June 2008			June 2007			Yr/Yr
Assets
Interest-earning assets:
Commercial loans	$	27,587		$	21,249		30	%
Commercial mortgage loans		12,321			10,799		14	%
Commercial construction loans		5,639			5,803		(3	%)
Commercial leases		3,735			3,669		2	%
Residential mortgage loans		11,472			10,184		13	%
Home equity		11,929			11,979		—
Automobile loans		9,491			10,392		(9	%)
Credit card		1,681			1,135		48	%
Other consumer loans and leases		1,207			1,247		(3	%)
Taxable securities		12,057			10,991		10	%
Tax exempt securities		383			521		(26	%)
Other short-term investments		540			214		152	%

Total interest-earning assets		98,042			88,183		11	%
Cash and due from banks		2,296			2,243		2	%
Other assets		12,424			10,333		20	%
Allowance for loan and lease losses		(1,068	)		(775	)	38	%

Total assets	$	111,694		$	99,984		12	%

Liabilities
Interest-bearing liabilities:
Interest checking	$	14,616		$	15,284		(4	%)
Savings		16,329			14,157		15	%
Money market		6,744			6,310		7	%
Foreign office		2,306			1,491		55	%
Other time		10,201			10,908		(6	%)
Certificates - $100,000 and over		6,989			6,596		6	%
Other foreign office		3,405			549		520	%
Federal funds purchased		4,451			3,026		47	%
Other short-term borrowings		5,280			2,386		121	%
Long-term debt		14,064			12,239		15	%

Total interest-bearing liabilities		84,385			72,946		16	%
Demand deposits		13,615			13,278		3	%
Other liabilities		4,190			3,977		5	%

Total liabilities		102,190			90,201		13	%
Shareholders’ equity		9,504			9,783		(3	%)

Total liabilities and shareholders’ equity	$	111,694		$	99,984		12	%

Yield Analysis
Interest-earning assets:
Commercial loans		5.50	%		7.48	%
Commercial mortgage loans		6.10	%		7.31	%
Commercial construction loans		5.54	%		7.72	%
Commercial leases		-2.76	%		4.33	%
Residential mortgage loans		6.12	%		6.14	%
Home equity		6.03	%		7.67	%
Automobile loans		6.33	%		6.21	%
Credit card		9.22	%		11.31	%
Other consumer loans and leases		5.24	%		5.29	%

Total loans and leases		5.55	%		7.02	%
Taxable securities		4.97	%		5.02	%
Tax exempt securities		7.32	%		7.39	%
Other short-term investments		2.69	%		5.45	%

Total interest-earning assets		5.47	%		6.77	%
Interest-bearing liabilities:
Interest checking		1.11	%		2.26	%
Savings		1.48	%		3.25	%
Money market		2.26	%		4.45	%
Foreign office		1.98	%		4.36	%
Other time		3.94	%		4.61	%
Certificates - $100,000 and over		3.77	%		5.15	%
Other foreign office		2.74	%		5.31	%
Federal funds purchased		2.77	%		5.31	%
Other short-term borrowings		2.56	%		4.34	%
Long-term debt		4.15	%		5.60	%

Total interest-bearing liabilities		2.61	%		4.07	%
Ratios:
Net interest margin (taxable equivalent)		3.22	%		3.40	%
Net interest rate spread (taxable equivalent)		2.86	%		2.70	%
Interest-bearing liabilities to interest-earning assets		86.07	%		82.72	%

Fifth Third Bancorp and Subsidiaries

Average Balance Sheet and Yield Analysis

$ in millions, except share data

(unaudited)


	For the Three Months Ended
	June 2008			March 2008			December 2007			September 2007			June 2007
Assets
Interest-earning assets:
Commercial loans	$	28,557		$	26,617		$	24,526		$	22,345		$	21,587
Commercial mortgage loans		12,590			12,052			11,588			11,117			11,030
Commercial construction loans		5,700			5,577			5,544			5,499			5,595
Commercial leases		3,747			3,723			3,692			3,700			3,678
Residential mortgage loans		11,244			11,699			11,181			10,396			10,201
Home equity		12,012			11,846			11,843			11,752			11,886
Automobile loans		8,439			10,542			11,158			10,865			10,552
Credit card		1,703			1,660			1,461			1,366			1,248
Other consumer loans and leases		1,220			1,196			1,179			1,203			1,271
Taxable securities		12,554			11,560			11,360			11,180			11,030
Tax exempt securities		364			403			464			490			508
Other short-term investments		445			634			682			499			203

Total interest-earning assets		98,575			97,509			94,678			90,412			88,789
Cash and due from banks		2,357			2,236			2,424			2,189			2,235
Other assets		12,370			12,477			11,444			10,330			10,524
Allowance for loan and lease losses		(1,204	)		(931	)		(819	)		(800	)		(781	)

Total assets	$	112,098		$	111,291		$	107,727		$	102,131		$	100,767

Liabilities
Interest-bearing liabilities:
Interest checking	$	14,396		$	14,836		$	14,394		$	14,334		$	15,061
Savings		16,583			16,075			15,616			15,390			14,620
Money market		6,592			6,896			6,363			6,247			6,244
Foreign office		2,169			2,443			2,249			1,808			1,637
Other time		9,517			10,884			11,011			10,290			10,780
Certificates - $100,000 and over		8,143			5,835			6,613			6,062			6,511
Other foreign office		2,948			3,861			2,464			1,981			732
Federal funds purchased		3,643			5,258			4,189			4,322			3,540
Other short-term borrowings		5,623			4,937			4,890			3,285			2,372
Long-term debt		14,803			13,328			13,188			12,351			12,238

Total interest-bearing liabilities		84,417			84,353			80,977			76,070			73,735
Demand deposits		14,023			13,208			13,345			13,143			13,370
Other liabilities		4,029			4,351			3,959			3,594			4,063

Total liabilities		102,469			101,912			98,281			92,807			91,168
Shareholders’ equity		9,629			9,379			9,446			9,324			9,599

Total liabilities and shareholders’ equity	$	112,098		$	111,291		$	107,727		$	102,131		$	100,767

Yield Analysis
Interest-earning assets:
Commercial loans		5.04	%		5.99	%		6.99	%		7.45	%		7.45	%
Commercial mortgage loans		5.93	%		6.28	%		7.00	%		7.31	%		7.30	%
Commercial construction loans		5.44	%		5.64	%		6.75	%		7.55	%		7.69	%
Commercial leases		-9.77	%		4.30	%		4.26	%		4.23	%		4.32	%
Residential mortgage loans		6.10	%		6.14	%		6.10	%		6.12	%		6.12	%
Home equity		5.61	%		6.46	%		7.20	%		7.63	%		7.66	%
Automobile loans		6.23	%		6.41	%		6.41	%		6.34	%		6.25	%
Credit card		9.28	%		9.15	%		9.31	%		10.03	%		10.62	%
Other consumer loans and leases		4.97	%		5.52	%		5.56	%		5.29	%		5.48	%

Total loans and leases		4.97	%		6.13	%		6.70	%		6.99	%		7.01	%
Taxable securities		4.83	%		5.13	%		5.29	%		5.00	%		4.98	%
Tax exempt securities		7.32	%		7.31	%		7.20	%		7.17	%		7.38	%
Other short-term investments		2.12	%		3.08	%		4.30	%		4.93	%		5.18	%

Total interest-earning assets		4.95	%		5.99	%		6.52	%		6.73	%		6.75	%
Interest-bearing liabilities:
Interest checking		0.78	%		1.44	%		1.91	%		2.14	%		2.21	%
Savings		1.16	%		1.81	%		2.69	%		3.15	%		3.23	%
Money market		1.76	%		2.74	%		3.80	%		4.35	%		4.44	%
Foreign office		1.42	%		2.48	%		3.74	%		4.33	%		4.38	%
Other time		3.52	%		4.30	%		4.53	%		4.61	%		4.63	%
Certificates - $100,000 and over		3.29	%		4.44	%		4.88	%		5.11	%		5.12	%
Other foreign office		2.10	%		3.22	%		4.57	%		5.12	%		5.31	%
Federal funds purchased		2.08	%		3.26	%		4.55	%		5.15	%		5.31	%
Other short-term borrowings		2.15	%		3.02	%		4.19	%		4.50	%		4.31	%
Long-term debt		3.85	%		4.48	%		5.36	%		5.47	%		5.65	%

Total interest-bearing liabilities		2.23	%		2.99	%		3.78	%		4.04	%		4.08	%
Ratios:
Net interest margin (taxable equivalent)		3.04	%		3.41	%		3.29	%		3.34	%		3.37	%
Net interest rate spread (taxable equivalent)		2.72	%		3.00	%		2.74	%		2.69	%		2.67	%
Interest-bearing liabilities to interest-earning assets		85.64	%		86.51	%		85.53	%		84.14	%		83.05	%

Fifth Third Bancorp and Subsidiaries

Summary of Loans and Leases

$ in millions

(unaudited)


	For the Three Months Ended
	June 2008		March 2008		December 2007		September 2007		June 2007
Average Loans and Leases
Commercial:
Commercial loans	$	28,299	$	25,367	$	23,650	$	22,183	$	21,584
Commercial mortgage loans		12,590		12,016		11,497		11,041		11,008
Commercial construction loans		5,700		5,577		5,544		5,499		5,595
Commercial leases		3,747		3,723		3,692		3,698		3,673

Subtotal - commercial		50,336		46,683		44,383		42,421		41,860
Consumer:
Residential mortgage loans		9,922		10,395		9,943		8,765		8,490
Home equity		12,012		11,846		11,843		11,752		11,881
Automobile loans		8,439		9,278		9,445		10,853		10,552
Credit card		1,703		1,660		1,461		1,366		1,248
Other consumer loans and leases		1,125		1,083		1,099		1,138		1,174

Subtotal - consumer		33,201		34,262		33,791		33,874		33,345

Total average loans and leases (excluding held for sale)	$	83,537	$	80,945	$	78,174	$	76,295	$	75,205

Average loans held for sale		1,676		3,967		3,998		1,950		1,843
End of Period Loans and Leases
Commercial:
Commercial loans	$	28,958	$	26,590	$	24,813	$	22,649	$	22,152
Commercial mortgage loans		13,394		12,155		11,862		11,090		11,044
Commercial construction loans		6,007		5,592		5,561		5,463		5,469
Commercial leases		3,647		3,727		3,737		3,710		3,697

Subtotal - commercial		52,006		48,064		45,973		42,912		42,362
Consumer:
Residential mortgage loans		9,866		9,873		10,540		9,057		8,477
Home equity		12,421		11,803		11,874		11,737		11,780
Automobile loans		8,362		8,394		9,201		10,006		10,714
Credit card		1,717		1,686		1,591		1,460		1,263
Other consumer loans and leases		1,152		1,066		1,074		1,082		1,113

Subtotal - consumer		33,518		32,822		34,280		33,342		33,347

Total portfolio loans and leases	$	85,524	$	80,886	$	80,253	$	76,254	$	75,709

Loans held for sale		889		2,573		4,329		2,761		1,708
Operating lease equipment		364		317		353		283		209
Loans and Leases Serviced for Others (a):
Commercial loans		3,463		3,429		3,441		3,481		3,862
Commercial mortgage loans		279		250		260		203		202
Commercial construction loans		287		257		231		211		171
Commercial leases		174		182		179		174		218
Residential mortgage loans		38,740		36,487		34,475		33,109		31,538
Home equity		275		279		289		304		326
Automobile loans		2,358		2,619		—		—		88
Credit card		16		19		20		21		112
Other consumer loans and leases		5		20		17		17		8

Total loans and leases serviced for others		45,597		43,542		38,912		37,520		36,525

Total loans and leases serviced	$	132,374	$	127,318	$	123,847	$	116,818	$	114,151

(a)	Fifth Third sells certain loans and leases and retains servicing responsibilities

Fifth Third Bancorp and Subsidiaries

Regulatory Capital (a)

$ in millions

(unaudited)


	As of
	June 2008			March 2008			December 2007			September 2007			June 2007
Tier I capital:
Shareholders’ equity	$	10,754		$	9,352		$	9,161		$	9,293		$	9,191
Goodwill and certain other intangibles		(3,774	)		(2,571	)		(2,590	)		(2,299	)		(2,318	)
Unrealized (gains) losses		121			(23	)		118			196			294
Qualifying trust preferred securities		2,763			2,302			2,303			1,390			815
Other		(35	)		(67	)		(68	)		621			634

Total tier I capital	$	9,829		$	8,993		$	8,924		$	9,201		$	8,616

Total risk-based capital:
Tier I capital	$	9,829		$	8,993		$	8,924		$	9,201		$	8,616
Qualifying allowance for credit losses		1,429			1,327			1,051			926			901
Qualifying subordinated notes		2,772			2,884			1,758			1,697			1,646

Total risk-based capital	$	14,030		$	13,204		$	11,733		$	11,824		$	11,163

Risk-weighted assets	$	115,453		$	116,451		$	115,529		$	108,754		$	105,950
Ratios:
Average shareholders’ equity to average assets		8.59	%		8.43	%		8.77	%		9.13	%		9.53	%
Regulatory capital:
Tier I capital		8.51	%		7.72	%		7.72	%		8.46	%		8.13	%
Total risk-based capital		12.15	%		11.34	%		10.16	%		10.87	%		10.54	%
Tier I leverage		9.08	%		8.28	%		8.50	%		9.23	%		8.76	%

(a)	Current period regulatory capital data and ratios are estimated

Fifth Third Bancorp and Subsidiaries

Summary of Credit Loss Experience

$ in millions

(unaudited)


	For the Three Months Ended
	June 2008			March 2008			December 2007			September 2007			June 2007
Average loans and leases (excluding held for sale):
Commercial loans	$	28,299		$	25,367		$	23,650		$	22,183		$	21,584
Commercial mortgage loans		12,590			12,016			11,497			11,041			11,008
Commercial construction loans		5,700			5,577			5,544			5,499			5,595
Commercial leases		3,747			3,723			3,692			3,698			3,673
Residential mortgage loans		9,922			10,395			9,943			8,765			8,490
Home equity		12,012			11,846			11,843			11,752			11,881
Automobile loans		8,439			9,278			9,445			10,853			10,552
Credit card		1,703			1,660			1,461			1,366			1,248
Other consumer loans and leases		1,125			1,083			1,099			1,138			1,174

Total average loans and leases (excluding held for sale)	$	83,537		$	80,945		$	78,174		$	76,295		$	75,205

Losses charged off:
Commercial loans	$	(109	)	$	(39	)	$	(50	)	$	(24	)	$	(29	)
Commercial mortgage loans		(22	)		(33	)		(16	)		(8	)		(16	)
Commercial construction loans		(49	)		(72	)		(12	)		(5	)		(7	)
Commercial leases		—			—			—			—			—
Residential mortgage loans		(63	)		(34	)		(18	)		(9	)		(9	)
Home equity		(57	)		(42	)		(35	)		(29	)		(22	)
Automobile loans		(35	)		(44	)		(37	)		(32	)		(24	)
Credit card		(23	)		(21	)		(17	)		(14	)		(12	)
Other consumer loans and leases		(7	)		(8	)		(8	)		(6	)		(5	)

Total losses		(365	)		(293	)		(193	)		(127	)		(124	)
Recoveries of losses previously charged off:
Commercial loans		2			3			2			1			5
Commercial mortgage loans		1			—			1			—			—
Commercial construction loans		—			—			—			—			—
Commercial leases		—			—			—			—			—
Residential mortgage loans		—			—			—			—			—
Home equity		3			1			3			2			2
Automobile loans		9			9			7			7			9
Credit card		2			1			2			1			2
Other consumer loans and leases		4			3			4			1			4

Total recoveries		21			17			19			12			22
Net losses charged off:
Commercial loans		(107	)		(36	)		(48	)		(23	)		(24	)
Commercial mortgage loans		(21	)		(33	)		(15	)		(8	)		(16	)
Commercial construction loans		(49	)		(72	)		(12	)		(5	)		(7	)
Commercial leases		—			—			—			—			—
Residential mortgage loans		(63	)		(34	)		(18	)		(9	)		(9	)
Home equity		(54	)		(41	)		(32	)		(27	)		(20	)
Automobile loans		(26	)		(35	)		(30	)		(25	)		(15	)
Credit card		(21	)		(20	)		(15	)		(13	)		(10	)
Other consumer loans and leases		(3	)		(5	)		(4	)		(5	)		(1	)

Total net losses charged off	$	(344	)	$	(276	)	$	(174	)	$	(115	)	$	(102	)

Net charge-off Ratios:
Commercial loans		1.52	%		0.57	%		0.80	%		0.41	%		0.44	%
Commercial mortgage loans		0.66	%		1.10	%		0.52	%		0.26	%		0.56	%
Commercial construction loans		3.46	%		5.20	%		0.83	%		0.35	%		0.48	%
Commercial leases		(0.01	)%		—			(0.01	)%		(0.01	)%		0.02	%
Residential mortgage loans		2.57	%		1.33	%		0.72	%		0.41	%		0.43	%
Home equity		1.83	%		1.39	%		1.10	%		0.94	%		0.66	%
Automobile loans		1.21	%		1.52	%		1.27	%		0.91	%		0.58	%
Credit card		4.93	%		4.78	%		3.91	%		3.59	%		3.28	%
Other consumer loans and leases		1.31	%		1.78	%		1.86	%		1.99	%		0.78	%

Total net charge-off ratio		1.66	%		1.37	%		0.89	%		0.60	%		0.55	%

Fifth Third Bancorp and Subsidiaries

Asset Quality

$ in millions

(unaudited)


	For the Three Months Ended
	June 2008			March 2008			December 2007			September 2007			June 2007
Allowance for Credit Losses
Allowance for loan and lease losses, beginning	$	1,205		$	937		$	827		$	803		$	784
Total net losses charged off		(344	)		(276	)		(174	)		(115	)		(102	)
Provision for loan and lease losses		719			544			284			139			121

Allowance for loan and lease losses, ending	$	1,580		$	1,205		$	937		$	827		$	803
Reserve for unfunded commitments, beginning	$	103		$	95		$	79		$	77		$	79
Provision for unfunded commitments		12			8			13			2			(2	)
Acquisitions		—			—			3			—			—

Reserve for unfunded commitments, ending	$	115		$	103		$	95		$	79		$	77

Components of allowance for credit losses:
Allowance for loan and lease losses	$	1,580		$	1,205		$	937		$	827		$	803
Reserve for unfunded commitments		115			103			95			79			77

Total allowance for credit losses	$	1,695		$	1,308		$	1,032		$	906		$	880

Nonperforming Assets and Delinquent Loans
Nonaccrual loans and leases (a)	$	1,988		$	1,388		$	893		$	569		$	406
Other assets, including other real estate owned		210			204			171			137			122

Total nonperforming assets	$	2,198		$	1,592		$	1,064		$	706		$	528

Ninety days past due loans and leases (b)	$	605		$	539		$	491		$	360		$	302

Ratios
Net losses charged off as a percent of average loans and leases		1.66	%		1.37	%		0.89	%		0.60	%		0.55	%
Allowance for loan and lease losses as a percent of loans and leases		1.85	%		1.49	%		1.17	%		1.08	%		1.06	%
Nonperforming assets as a percent of loans, leases and other assets, including other real estate owned		2.56	%		1.96	%		1.32	%		0.92	%		0.70	%

(a)	Includes $329 million of residential mortgage loans and $318 million of consumer debt restructurings as of June 30, 2008.

(b)	Includes $229 million of residential mortgage loans as of June 30, 2008.


For the three months ended June 30, 2008 ($ in millions)	Commercial Banking		Branch Banking		Consumer Lending		Processing Solutions		Investment Advisors		Other/ Eliminations		Total
Net interest income (a)	350		400		104		—		47		(157	)	744
Provision for loan and lease losses	(156	)	(75	)	(104	)	(3	)	(5	)	(376	)	(719	)

Net interest income after provision for loan and lease losses	194		325		—		(3	)	42		(533	)	25
Total noninterest income	158		212		85		216		101		(50	)	722
Total noninterest expense	(216	)	(308	)	(87	)	(141	)	(99	)	(7	)	(858	)

Net income (loss) before taxes	136		229		(2	)	72		44		(590	)	(111	)
Applicable income taxes (a)	(22	)	(81	)	1		(25	)	(16	)	52		(91	)

Net income (loss)	114		148		(1	)	47		28		(538	)	(202	)


For the three months ended March 31, 2008 ($ in millions)	Commercial Banking		Branch Banking		Consumer Lending		Processing Solutions		Investment Advisors		Other/ Eliminations		Total
Net interest income (a)	358		384		117		1		45		(79	)	826
Provision for loan and lease losses	(125	)	(64	)	(77	)	(3	)	(6	)	(269	)	(544	)

Net interest income after provision for loan and lease losses	233		320		40		(2	)	39		(348	)	282
Total noninterest income	160		191		112		198		102		101		864
Total noninterest expense	(222	)	(296	)	(90	)	(136	)	(95	)	124		(715	)

Net income (loss) before taxes	171		215		62		60		46		(123	)	431
Applicable income taxes (a)	(36	)	(76	)	(22	)	(21	)	(16	)	26		(145	)

Net income (loss)	135		139		40		39		30		(97	)	286


For the three months ended December 31, 2007 ($ in millions)	Commercial Banking		Branch Banking		Consumer Lending		Processing Solutions		Investment Advisors		Other/ Eliminations		Total
Net interest income (a)	335		383		105		(3	)	40		(75	)	785
Provision for loan and lease losses	(57	)	(58	)	(54	)	(2	)	(3	)	(110	)	(284	)

Net interest income after provision for loan and lease losses	278		325		51		(5	)	37		(185	)	501
Total noninterest income	161		208		42		202		100		(204	)	509
Total noninterest expense	(211	)	(292	)	(65	)	(135	)	(97	)	(140	)	(940	)

Net income (loss) before taxes	228		241		28		62		40		(529	)	70
Applicable income taxes (a)	(57	)	(85	)	(10	)	(22	)	(14	)	134		(54	)

Net income (loss)	171		156		18		40		26		(395	)	16


For the three months ended September 30, 2007 ($ in millions)	Commercial Banking		Branch Banking		Consumer Lending		Processing Solutions		Investment Advisors		Other/ Eliminations		Total
Net interest income (a)	330		374		97		(3	)	39		(77	)	760
Provision for loan and lease losses	(22	)	(44	)	(39	)	(3	)	(5	)	(26	)	(139	)

Net interest income after provision for loan and lease losses	308		330		58		(6	)	34		(103	)	621
Total noninterest income	135		203		46		190		102		5		681
Total noninterest expense	(193	)	(277	)	(61	)	(124	)	(96	)	(102	)	(853	)

Net income (loss) before taxes	250		256		43		60		40		(200	)	449
Applicable income taxes (a)	(68	)	(90	)	(15	)	(21	)	(14	)	84		(124	)

Net income (loss)	182		166		28		39		26		(116	)	325


For the three months ended June 30, 2007 ($ in millions)	Commercial Banking		Branch Banking		Consumer Lending		Processing Solutions		Investment Advisors		Other/ Eliminations		Total
Net interest income (a)	325		362		99		(1	)	38		(78	)	745
Provision for loan and lease losses	(31	)	(38	)	(27	)	(3	)	(2	)	(20	)	(121	)

Net interest income after provision for loan and lease losses	294		324		72		(4	)	36		(98	)	624
Total noninterest income	132		195		57		182		104		(1	)	669
Total noninterest expense	(194	)	(278	)	(64	)	(117	)	(103	)	(9	)	(765	)

Net income (loss) before taxes	232		241		65		61		37		(108	)	528
Applicable income taxes (a)	(56	)	(85	)	(23	)	(22	)	(13	)	47		(152	)

Net income (loss)	176		156		42		39		24		(61	)	376

(a)

Includes taxable equivalent adjustments of $6 million for all periods presented.

Fifth Third Bancorp (FITB) 8-KResults of Operations and Financial Condition