Wachovia Corp New (WBPS) 8-K Results of Operations and Financial Condition

Exhibit (99)(a)

  Press Release October 16, 2006

WACHOVIA EARNS $1.9 BILLION; EPS UP 10% TO $1.17 IN 3RD QUARTER 2006

Strong fundamentals maintain earnings stability in challenging environment

3^rd QUARTER 2006 COMPARED WITH 3^rd QUARTER 2005

• Double-digit earnings growth despite the difficult interest rate environment.

• 5 percent revenue growth and modest expense growth drive improved overhead efficiency ratio while investment for the future continues.

• Credit quality continues to be strong, with increased provision reflecting growth in auto and other consumer businesses and lower commercial recoveries.

• Expanded consumer franchise including auto lending, Westcorp retail branches and credit cards generates results ahead of expectations.

• Customer service and loyalty scores remain excellent.

Earnings Highlights

	Three Months Ended
	September 30, 2006				June 30, 2006		September 30, 2005
(In millions, except per share data)	Amount			EPS	Amount	EPS	Amount	EPS
Earnings
Net income(GAAP)	$	1,877		1.17	1,885	1.17	1,665	1.06
Net merger-related and restructuring expenses		25		0.02	15	0.01	51	0.03
Earnings excluding merger-related and restructuring expenses	$	1,902		1.19	1,900	1.18	1,716	1.09
Financial ratios
Return on average common stockholders’ equity		14.85	%		15.41		13.95
Net interest margin (a)		3.03			3.18		3.18
Fee and other income as % of total revenue (a)		49.20			49.37		48.63
Overhead efficiency ratio (a)		57.44	%		58.71		59.78
Capital adequacy (b)
Tier 1 capital ratio		7.76	%		7.81		7.42
Total capital ratio		11.50			11.42		10.79
Leverage ratio		6.60	%		6.57		5.96
Asset quality
Allowance for loan losses as % of nonaccrual and restructured loans		520	%		488		347
Allowance for loan losses as % of loans, net		1.03			1.07		1.13
Allowance for credit losses as % of loans, net (c)		1.09			1.13		1.20
Net charge-offs as % of average loans, net		0.16			0.08		0.10
Nonperforming assets as % of loans, net, foreclosed properties and loans held for sale		0.26	%		0.25		0.37

(a) Tax-equivalent.

(b) The third quarter of 2006 is based on estimates.

(c) The allowance for credit losses is the sum of the allowance for loan losses and the reserve for unfunded lending commitments.

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WACHOVIA EARNS $1.9 BILLION; EPS UP 10% TO $1.17 PER COMMON SHARE/page 2

CHARLOTTE, N.C. — Wachovia Corp. (NYSE:WB) today reported net income of $1.88 billion, or $1.17 per share, in the third quarter of 2006 compared with $1.66 billion, or $1.06 per share, in the third quarter of 2005.

Excluding after-tax net merger-related expenses of 2 cents per share in the third quarter of 2006 and 3 cents per share in the third quarter of 2005, earnings were $1.90 billion, or $1.19 per share, in the third quarter of 2006 compared with $1.72 billion, or $1.09 per share, in the third quarter of 2005.

“Wachovia once again delivered double-digit earnings per share growth due to strong fundamentals and focused execution,” said Ken Thompson, Wachovia chairman and chief executive officer. “In the face of a challenging yield curve environment, we continued to improve efficiency, while asset quality remained strong. Our industry-leading customer service helped sales productivity remain stable, and our expanded consumer franchise including auto lending, credit cards and Westcorp retail branches in California generated results ahead of our expectations. With the closing of the Golden West merger on October 1, we’re very excited about our prospects as we extend our brand promise to customers nationwide.”

Wachovia Corporation

	Three Months Ended
(In millions)	September 30, 2006		June 30, 2006	September 30, 2005
Net interest income(Tax-equivalent)	$	3,578	3,675	3,440
Fee and other income		3,465	3,583	3,258
Total revenue(Tax-equivalent)		7,043	7,258	6,698
Provision for credit losses		108	59	82
Noninterest expense		4,045	4,261	4,004
Net income		1,877	1,885	1,665
Average loans, net		281,110	275,265	228,960
Average core deposits	$	291,227	291,638	280,748

Results include the impact of the acquisition of Westcorp on March 1, 2006. The acquisition of Golden West Financial Corporation closed on October 1, 2006, and therefore is not included in Wachovia’s September 30, 2006, financial results. In the third quarter of 2006 compared with the third quarter of 2005, Wachovia:

• Grew revenue 5 percent on higher fee income and growth in loans and deposits, including the addition of Westcorp, although the benefit of a larger balance sheet was limited by margin compression.

• Increased net interest income 4 percent, reflecting higher average commercial loans, up 14 percent, and average consumer loans, up 36 percent.

• Commercial loan growth was led by middle-market and business banking, commercial real estate and large corporate lending, while consumer loan growth was led by higher real estate-secured loans, which included the impact of year-end 2005 loan transfers from loans held for sale, as well as the addition of Westcorp.

• Average core deposits rose 4 percent and average low-cost core deposits were relatively stable. Growth in lower spread loans, a shift in deposit mix and the effects of a more inverted yield curve resulted in 15 basis points of margin compression.

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WACHOVIA EARNS $1.9 BILLION; EPS UP 10% TO $1.17 PER COMMON SHARE/page 3

• 6 percent growth in fee and other income was led by 15 percent growth in service charges and 10 percent growth in fiduciary and asset management fees. Growth in insurance commissions was more than offset by lower retail brokerage commissions as customers migrate to retail brokerage managed account relationships. In addition, principal investing and trading results were lower, while securities gains rose from the third quarter of 2005.

• Noninterest expense rose modestly as lower incentives and a favorable resolution of franchise tax matters were offset by the impact of acquisitions. The overhead efficiency ratio improved to 57.44 percent, down 234 basis points.

• The increase in the provision for credit losses to $108 million largely reflected growth in auto lending and other consumer loans as well as lower commercial loan recoveries. Net charge-offs were $116 million, or an annualized 0.16 percent of average net loans. Total nonperforming assets including loans held for sale were $782 million, or 0.26 percent of loans, foreclosed properties and loans held for sale.

Lines of Business

The following discussion covers the results for Wachovia’s four core business segments and is on a segment earnings basis, which excludes net merger-related and restructuring expenses, other intangible amortization and discontinued operations. Segment earnings are the basis on which Wachovia manages and allocates capital to its business segments. Pages 13 and 14 include a reconciliation of segment results to Wachovia’s consolidated results of operations in accordance with GAAP.

General Bank

General Bank Highlights

	Three Months Ended
(In millions)	September 30, 2006			June 30, 2006	September 30, 2005
Net interest income(Tax-equivalent)	$	2,823		2,786	2,379
Fee and other income		902		857	760
Total revenue(Tax-equivalent)		3,773		3,691	3,192
Provision for credit losses		123		95	77
Noninterest expense		1,689		1,752	1,575
Segment earnings	$	1,246		1,171	975
Cash overhead efficiency ratio(Tax-equivalent)		44.75	%	47.47	49.33
Average loans, net	$	197,138		192,552	163,752
Average core deposits		216,795		214,750	203,104
Economic capital, average	$	8,476		8,340	7,038

The General Bank includes retail, small business and commercial customers. The third quarter of 2006 compared with the third quarter of 2005 included:

• Earnings of $1.2 billion on an 18 percent increase in revenue to $3.8 billion, driven by loan and deposit growth, including the addition of Westcorp. Sales production remained stable although the mix is shifting from demand deposits to certificates of deposit and in consumer real estate, from variable rate to fixed rate loans.

• 20 percent growth in average loans led by growth in commercial and consumer loans as well as the addition of an average $14.7 billion from Westcorp.

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WACHOVIA EARNS $1.9 BILLION; EPS UP 10% TO $1.17 PER COMMON SHARE/page 4

• Deposit growth led by consumer certificates of deposit and money market funds. Net new retail checking accounts increased by 467,000 year-to-date, compared with an increase of 420,000 in the same period of 2005.

• 19 percent growth in fee and other income included 25 percent growth in consumer service charges and 25 percent growth in interchange income, partially offset by a 5 percent decline in mortgage banking-related fee and other income.

• 7 percent growth in noninterest expense included Westcorp, branch expansion activity and costs related to reentering the credit card business. Despite the increased expense, the General Bank’s overhead efficiency ratio improved 458 basis points to 44.75 percent.

• Provision expense rose in connection with Westcorp.

Capital Management

Capital Management Highlights

	Three Months Ended
(In millions)	September 30, 2006			June 30, 2006	September 30, 2005
Net interest income(Tax-equivalent)	$	247		259	211
Fee and other income		1,230		1,222	1,146
Total revenue(Tax-equivalent)		1,469		1,472	1,348
Provision for credit losses		—		—	—
Noninterest expense		1,095		1,116	1,067
Segment earnings	$	237		226	179
Cash overhead efficiency ratio(Tax-equivalent)		74.59	%	75.75	79.13
Average loans, net	$	795		616	372
Average core deposits		30,114		31,827	33,807
Economic capital, average	$	1,534		1,556	1,476

Capital Management includes retail brokerage services and asset management. The third quarter of 2006 compared with the third quarter of 2005 included:

• Earnings of $237 million on 9 percent revenue growth as strength in retail brokerage managed account fees, wider deposit spreads and the impact of two June 2006, acquisitions overcame lower retail brokerage transaction activity. Managed assets grew 21 percent from year-end to $128.8 billion at September 30, 2006.

• 3 percent growth in noninterest expense primarily due to increased production-based incentives and the impact of the acquisitions. The overhead efficiency ratio improved 454 basis points to 74.59 percent due to strong net interest income growth, retail brokerage managed account fee growth and expense control.

• Total assets under management of $250.1 billion at September 30, 2006, were up 9 percent from December 31, 2005. Equity assets reached $93.7 billion, up 14 percent in the same period, including $5.5 billion in assets from the Metropolitan West Capital Management acquisition and market appreciation. Total brokerage client assets grew 7 percent from year-end 2005 to $729.9 billion.

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WACHOVIA EARNS $1.9 BILLION; EPS UP 10% TO $1.17 PER COMMON SHARE/page 5

Wealth Management

Wealth Management Highlights

	Three Months Ended
(In millions)	September 30, 2006			June 30, 2006	September 30, 2005
Net interest income(Tax-equivalent)	$	149		151	146
Fee and other income		199		197	196
Total revenue(Tax-equivalent)		349		349	343
Provision for credit losses		—		2	6
Noninterest expense		237		252	241
Segment earnings	$	71		61	62
Cash overhead efficiency ratio(Tax-equivalent)		67.81	%	72.20	70.13
Average loans, net	$	16,438		15,986	14,202
Average core deposits		13,790		14,355	13,475
Economic capital, average	$	532		528	506

Wealth Management includes private banking, personal trust, investment advisory services, charitable services, financial planning and insurance brokerage. The third quarter of 2006 compared with the third quarter of 2005 included:

• 15 percent earnings growth to $71 million on modest revenue growth and lower expenses.

• Revenue growth driven equally by net interest income and fee and other income growth.

• 2 percent growth in net interest income fueled by strong momentum in loans and a modest increase in average core deposits.

• Modest growth in fee and other income driven by higher banking fees and higher trust and investment management fees on increased asset valuations, partially offset by a decline in insurance commissions.

Corporate and Investment Bank

Corporate and Investment Bank Highlights

	Three Months Ended
(In millions)	September 30, 2006			June 30, 2006		September 30, 2005
Net interest income(Tax-equivalent)	$	482		507		532
Fee and other income		989		1,215		1,027
Total revenue(Tax-equivalent)		1,428		1,680		1,514
Provision for credit losses		(5	)	(33	)	(3	)
Noninterest expense		791		878		808
Segment earnings	$	404		526		446
Cash overhead efficiency ratio(Tax-equivalent)		55.37	%	52.30		53.35
Average loans, net	$	45,705		43,728		38,813
Average core deposits		26,048		26,174		24,790
Economic capital, average	$	6,605		6,352		5,606

The Corporate and Investment Bank includes corporate lending, investment banking, and treasury and international trade finance. Third quarter 2006 results compared with the third quarter of 2005 included:

• Earnings of $404 million as lower incentive expense partially offset a 6 percent decline in revenue driven by lower market-related revenue.

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WACHOVIA EARNS $1.9 BILLION; EPS UP 10% TO $1.17 PER COMMON SHARE/page 6

• A 9 percent decline in net interest income reflected spread compression in asset-based lending and leasing, lower trading-related net interest income, and cross-border leasing runoff.

• A 4 percent decline in fee and other income largely reflected lower principal investing gains and lower results from commercial mortgage activity.

• A 2 percent decline in noninterest expense primarily related to lower incentive expense.

• Core deposit and loan growth from organic growth and acquisitions.

• The provision reflected net loan loss recoveries.

***

Wachovia Corporation (NYSE:WB) is one of the nation’s largest diversified financial services companies, providing a broad range of retail banking and brokerage, asset and wealth management, and corporate and investment banking products and services. Including the Golden West merger, which closed on October 1, 2006, Wachovia has retail and commercial banking operations in 21 states with 3,400 retail banking offices from Connecticut to Florida and west to Texas and California. In addition, two core businesses operate under the Wachovia Securities brand name: retail brokerage with 737 offices in 49 states and in Latin America, and corporate and investment banking in selected industries nationwide. Other nationwide businesses include mortgage lending in 39 states and auto finance covering 46 states. Globally, Wachovia serves clients through more than 40 international offices. Online banking is available at wachovia.com; online brokerage products and services at wachoviasec.com, and investment products and services at evergreeninvestments.com. At September 30, 2006, Wachovia had assets of $559.9 billion and market capitalization of $88.2 billion. On the same date, based on pro forma data, Wachovia’s combined assets were approximately $700 billion and combined market capitalization was $107 billion.

Forward-Looking Statements

This news release contains various forward-looking statements. A discussion of various factors that could cause Wachovia Corporation’s actual results to differ materially from those expressed in such forward-looking statements is included in Wachovia’s filings with the Securities and Exchange Commission, including its Current Report on Form 8-K dated October 16, 2006.

Explanation of Wachovia’s Use of Certain Non-GAAP Financial Measures

In addition to results presented in accordance with GAAP, this news release includes certain non-GAAP financial measures, including those presented on page 1 and on page 10 under the captions “Earnings Excluding Merger-Related and Restructuring Expenses”, “Earnings Excluding Merger-Related and Restructuring Expenses, and Discontinued Operations” and “Earnings Excluding Merger-Related and Restructuring Expenses, Other Intangible Amortization and Discontinued Operations”, and which are reconciled to GAAP financial measures on pages 21 and 22. In addition, in this news release certain designated net interest income amounts are presented on a tax-equivalent basis, including the calculation of the overhead efficiency ratio.

Wachovia believes these non-GAAP financial measures provide information useful to investors in understanding the underlying operational performance of the company, its business and performance trends and facilitates comparisons with the performance of others in the financial services industry. Specifically, Wachovia believes the exclusion of merger-related and restructuring expenses, discontinued operations and the cumulative effect of a change in accounting principle permits evaluation and a comparison of results for on-going business operations, and it is on this basis that Wachovia’s management internally assesses the company’s performance. Those non-operating items are excluded from Wachovia’s segment measures used internally to evaluate segment performance in accordance with GAAP because management does not consider them particularly relevant or useful in evaluating the operating performance of our

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WACHOVIA EARNS $1.9 BILLION; EPS UP 10% TO $1.17 PER COMMON SHARE/page 7

business segments. In addition, because of the significant amount of deposit base intangible amortization, Wachovia believes the exclusion of this expense provides investors with consistent and meaningful comparisons to other financial services firms. Wachovia’s management makes recommendations to its board of directors about dividend payments based on reported earnings excluding merger-related and restructuring expenses, other intangible amortization, discontinued operations and the cumulative effect of a change in accounting principle, and has communicated certain dividend payout ratio goals to investors on this basis. Management believes this payout ratio is useful to investors because it provides investors with a better understanding of and permits investors to monitor Wachovia’s dividend payout policy. Wachovia also believes the presentation of net interest income on a tax-equivalent basis ensures comparability of net interest income arising from both taxable and tax-exempt sources and is consistent with industry standards. Wachovia operates one of the largest retail brokerage businesses in our industry, and we have presented an overhead efficiency ratio excluding these brokerage services, which management believes is useful to investors in comparing the performance of our banking business with other banking companies.

Although Wachovia believes the above non-GAAP financial measures enhance investors’ understanding of its business and performance, these non-GAAP financial measures should not be considered an alternative to GAAP basis financial measures.

Earnings Conference Call and Supplemental Materials

Wachovia CEO Ken Thompson and CFO Tom Wurtz will review Wachovia’s third quarter 2006 results in a conference call and audio webcast beginning at 10 a.m. Eastern Time today. This review may include a discussion of certain non-GAAP financial measures. Supplemental materials relating to third quarter results, which also include a reconciliation of any non-GAAP measures to Wachovia’s reported financials, are available on the Internet at Wachovia.com/investor, and investors are encouraged to access these materials in advance of the conference call.

Webcast Instructions: To gain access to the webcast, which will be “listen-only,” go to Wachovia.com/investor and click on the link “Wachovia Third Quarter Earnings Audio Webcast.” In order to listen to the webcast, you will need to download either Real Player or Media Player.

Teleconference Instructions: The telephone number for the conference call is 888-357-9787 for U.S. callers or 706-679-7342 for international callers. You will be asked to tell the answering coordinator your name and the name of your firm. Mention the conference Access Code: Wachovia.

Replay: Monday, October 16, at noon EDT and continuing through 5 p.m. EST Friday, November 17. Replay telephone number is 706-645-9291; access code: 6572253.

Investors seeking further information should contact the Investor Relations team: Alice Lehman at 704-374-4139 or Ellen Taylor at 704-383-1381. Media seeking further information should contact the Corporate Media Relations team: Mary Eshet at 704-383-7777 or Christy Phillips at 704-383-8178.

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WACHOVIA CORPORATION AND SUBSIDIARIES

FINANCIAL TABLES

TABLE OF CONTENTS

	PAGE
Financial Highlights—Five Quarters Ended September 30, 2006	9
Other Financial Data—Five Quarters Ended September 30, 2006	10
Consolidated Statements of Income—Five Quarters Ended September 30, 2006	11
Consolidated Statements of Income—Nine Months Ended September 30, 2006 and 2005	12
Business Segments—Three Months Ended September 30, 2006 and June 30, 2006	13
Business Segments—Three Months Ended September 30, 2005	14
Loans—On-Balance Sheet, and Managed and Servicing Portfolios—Five Quarters Ended September 30, 2006	15
Allowance for Loan Losses and Nonperforming Assets—Five Quarters Ended September 30, 2006	16
Consolidated Balance Sheets—Five Quarters Ended September 30, 2006	17
Net Interest Income Summaries—Five Quarters Ended September 30, 2006	18 - 19
Net Interest Income Summaries—Nine Months Ended September 30, 2006 and 2005	20
Reconciliation of Certain Non-GAAP Financial Measures—Five Quarters Ended September 30, 2006	21 - 22

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WACHOVIA CORPORATION AND SUBSIDIARIES

FINANCIAL HIGHLIGHTS

(Unaudited)

	2006					2005
(Dollars in millions, except per share data)	Third Quarter			Second Quarter	First Quarter	Fourth Quarter		Third Quarter
EARNINGS SUMMARY
Net interest income(GAAP)	$	3,541		3,641	3,490	3,523		3,387
Tax-equivalent adjustment		37		34	49	52		53
Net interest income(Tax-equivalent)		3,578		3,675	3,539	3,575		3,440
Fee and other income		3,465		3,583	3,517	2,989		3,258
Total revenue(Tax-equivalent)		7,043		7,258	7,056	6,564		6,698
Provision for credit losses		108		59	61	81		82
Other noninterest expense		3,915		4,139	4,079	4,032		3,820
Merger-related and restructuring expenses		38		24	68	58		83
Other intangible amortization		92		98	92	93		101
Total noninterest expense		4,045		4,261	4,239	4,183		4,004
Minority interest in income of consolidated subsidiaries		104		90	95	103		104
Income from continuing operations before income taxes(Tax-equivalent)		2,786		2,848	2,661	2,197		2,508
Income taxes		872		929	884	652		790
Tax-equivalent adjustment		37		34	49	52		53
Income from continuing operations		1,877		1,885	1,728	1,493		1,665
Discontinued operations, net of income taxes		—		—	—	214		—
Net income	$	1,877		1,885	1,728	1,707		1,665
Diluted earnings per common share	$	1.17		1.17	1.09	1.09		1.06
Return on average common stockholders’ equity		14.85	%	15.41	14.62	14.60		13.95
Return on average assets		1.34		1.39	1.34	1.30		1.29
Overhead efficiency ratio		57.44	%	58.71	60.07	63.72		59.78
Operating leverage	$	1		180	436	(312	)	92
ASSET QUALITY
Allowance for loan losses as % of loans, net		1.03	%	1.07	1.08	1.05		1.13
Allowance for loan losses as % of nonperforming assets		396		421	389	378		303
Allowance for credit losses as % of loans, net		1.09		1.13	1.14	1.11		1.20
Net charge-offs as % of average loans, net		0.16		0.08	0.09	0.09		0.10
Nonperforming assets as % of loans, net, foreclosed properties and loans held for sale		0.26	%	0.25	0.28	0.28		0.37
CAPITAL ADEQUACY (a)
Tier I capital ratio		7.76	%	7.81	7.87	7.50		7.42
Total capital ratio		11.50		11.42	11.45	10.82		10.79
Leverage ratio		6.60	%	6.57	6.86	6.12		5.96
OTHER DATA
Average diluted common shares(In millions)		1,600		1,613	1,586	1,570		1,575
Actual common shares (In millions)		1,581		1,589	1,608	1,557		1,553
Dividends paid per common share	$	0.56		0.51	0.51	0.51		0.51
Dividend payout ratio on common shares		47.86	%	43.59	46.79	46.79		48.11
Book value per common share	$	32.37		30.75	30.95	30.55		30.10
Common stock price		55.80		54.08	56.05	52.86		47.59
Market capitalization	$	88,231		85,960	90,156	82,291		73,930
Common stock price to book value		172	%	176	181	173		158
FTE employees		97,060		97,316	97,134	93,980		92,907
Total financial centers/brokerage offices		3,870		3,847	3,889	3,850		3,840
ATMs		5,163		5,134	5,179	5,119		5,119

(a) The third quarter of 2006 is based on estimates.

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WACHOVIA CORPORATION AND SUBSIDIARIES

OTHER FINANCIAL DATA

(Unaudited)

	2006					2005
(In millions)	Third Quarter			Second Quarter	First Quarter	Fourth Quarter		Third Quarter
EARNINGS EXCLUDING MERGER-RELATED AND RESTRUCTURING EXPENSES, AND DISCONTINUED OPERATIONS (a) (b)
Return on average common stockholders’ equity		15.02	%	15.52	15.01	13.05		14.36
Return on average assets		1.36		1.40	1.38	1.17		1.33
Overhead efficiency ratio		56.90		58.39	59.10	62.84		58.55
Overhead efficiency ratio excluding brokerage		53.32	%	54.89	55.23	59.58		54.49
Operating leverage	$	16		135	446	(337	)	84
EARNINGS EXCLUDING MERGER-RELATED AND RESTRUCTURING EXPENSES, OTHER INTANGIBLE AMORTIZATION AND DISCONTINUED OPERATIONS (a) (b) (c)
Dividend payout ratio on common shares		45.53	%	41.80	43.97	50.50		45.13
Return on average tangible common stockholders’ equity		30.79		32.63	30.64	27.11		29.14
Return on average tangible assets		1.47		1.52	1.49	1.27		1.45
Overhead efficiency ratio		55.60		57.03	57.81	61.41		57.06
Overhead efficiency ratio excluding brokerage		51.76	%	53.26	53.67	57.85		52.70
Operating leverage	$	8		142	444	(343	)	77
OTHER FINANCIAL DATA
Net interest margin		3.03	%	3.18	3.21	3.25		3.18
Fee and other income as % of total revenue		49.20		49.37	49.84	45.55		48.63
Effective income tax rate (d)		31.71		33.05	33.84	34.10		32.21
Effective tax rate (Tax-equivalent) (d) (e)		32.61	%	33.84	35.06	35.39		33.63
AVERAGE BALANCE SHEET DATA
Commercial loans, net	$	150,566		146,341	142,469	138,361		132,637
Consumer loans, net		130,544		128,924	118,105	99,121		96,323
Loans, net		281,110		275,265	260,574	237,482		228,960
Earning assets		472,139		463,232	442,527	439,204		431,346
Total assets		555,164		543,612	522,209	520,382		511,567
Core deposits		291,227		291,638	290,214	287,502		280,748
Total deposits		326,360		327,938	322,830	319,825		306,371
Interest-bearing liabilities		414,563		403,234	384,406	382,974		375,782
Stockholders’ equity	$	50,143		49,063	47,926	46,407		47,328
PERIOD-END BALANCE SHEET DATA
Commercial loans, net	$	159,424		154,277	150,902	147,165		141,063
Consumer loans, net		131,335		128,639	130,030	111,850		98,670
Loans, net		290,759		282,916	280,932	259,015		239,733
Goodwill and other intangible assets
Goodwill		23,535		23,550	23,443	21,807		21,857
Deposit base		577		631	691	705		779
Customer relationships		688		714	742	413		416
Tradename		90		90	90	90		90
Total assets		559,922		553,614	541,842	520,755		532,381
Core deposits		291,667		292,243	296,092	293,562		287,732
Total deposits		323,298		327,614	328,564	324,894		320,439
Stockholders’ equity	$	51,180		48,872	49,789	47,561		46,757

(a) These financial measures are calculated by excluding from GAAP computed net income presented on page 9, $25 million, $15 million, $46 million, $37 million and $51 million in the third, second and first quarters of 2006, and in the fourth and third quarters of 2005, respectively, of after-tax net merger-related and restructuring expenses, and $214 million after tax in the fourth quarter of 2005 related to discontinued operations.

(b) See page 9 for the most directly comparable GAAP financial measure and pages 21 and 22 for a more detailed reconciliation.

(c) These financial measures are calculated by excluding from GAAP computed net income presented on page 9, $59 million, $64 million, $59 million, $57 million and $63 million in the third, second and first quarters of 2006, and in the fourth and third quarters of 2005, respectively, of deposit base and other intangible amortization.

(d) The fourth quarter of 2005 includes taxes on discontinued operations.

(e) The tax-equivalent tax rate applies to fully tax-equivalized revenues.

PAGE 11

WACHOVIA CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)

	2006					2005
(In millions, except per share data)	Third Quarter		Second Quarter	First Quarter		Fourth Quarter		Third Quarter
INTEREST INCOME
Interest and fees on loans	$	5,096	4,823	4,321		3,846		3,588
Interest and dividends on securities		1,692	1,685	1,565		1,486		1,434
Trading account interest		401	387	325		462		387
Other interest income		595	509	496		696		635
Total interest income		7,784	7,404	6,707		6,490		6,044
INTEREST EXPENSE
Interest on deposits		2,238	2,035	1,779		1,618		1,408
Interest on short-term borrowings		860	755	718		764		742
Interest on long-term debt		1,145	973	720		585		507
Total interest expense		4,243	3,763	3,217		2,967		2,657
Net interest income		3,541	3,641	3,490		3,523		3,387
Provision for credit losses		108	59	61		81		82
Net interest income after provision for credit losses		3,433	3,582	3,429		3,442		3,305
FEE AND OTHER INCOME
Service charges		638	622	574		555		555
Other banking fees		427	449	428		400		385
Commissions		562	588	623		573		598
Fiduciary and asset management fees		823	808	761		790		749
Advisory, underwriting and other investment banking fees		292	318	302		325		294
Trading account profits (losses)		123	164	219		(31	)	160
Principal investing		91	189	103		135		166
Securities gains (losses)		94	25	(48	)	(74	)	29
Other income		415	420	555		316		322
Total fee and other income		3,465	3,583	3,517		2,989		3,258
NONINTEREST EXPENSE
Salaries and employee benefits		2,531	2,652	2,697		2,470		2,476
Occupancy		284	291	275		283		260
Equipment		291	299	280		277		276
Advertising		54	56	47		51		50
Communications and supplies		158	162	167		155		158
Professional and consulting fees		200	184	167		213		167
Other intangible amortization		92	98	92		93		101
Merger-related and restructuring expenses		38	24	68		58		83
Sundry expense		397	495	446		583		433
Total noninterest expense		4,045	4,261	4,239		4,183		4,004
Minority interest in income of consolidated subsidiaries		104	90	95		103		104
Income from continuing operations before income taxes		2,749	2,814	2,612		2,145		2,455
Income taxes		872	929	884		652		790
Income from continuing operations		1,877	1,885	1,728		1,493		1,665
Discontinued operations, net of income taxes		—	—	—		214		—
Net income	$	1,877	1,885	1,728		1,707		1,665
PER COMMON SHARE DATA
Basic earnings
Income from continuing operations	$	1.19	1.19	1.11		0.97		1.07
Net income		1.19	1.19	1.11		1.11		1.07
Diluted earnings
Income from continuing operations		1.17	1.17	1.09		0.95		1.06
Net income		1.17	1.17	1.09		1.09		1.06
Cash dividends	$	0.56	0.51	0.51		0.51		0.51
AVERAGE COMMON SHARES
Basic		1,573	1,585	1,555		1,541		1,549
Diluted		1,600	1,613	1,586		1,570		1,575

PAGE 12

WACHOVIA CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)

	Nine Months Ended September 30,
(In millions, except per share data)	2006		2005
INTEREST INCOME
Interest and fees on loans	$	14,240	10,124
Interest and dividends on securities		4,942	4,297
Trading account interest (a)		1,113	1,119
Other interest income		1,600	1,659
Total interest income		21,895	17,199
INTEREST EXPENSE
Interest on deposits		6,052	3,679
Interest on short-term borrowings		2,333	2,013
Interest on long-term debt		2,838	1,349
Total interest expense		11,223	7,041
Net interest income		10,672	10,158
Provision for credit losses		228	168
Net interest income after provision for credit losses		10,444	9,990
FEE AND OTHER INCOME
Service charges		1,834	1,596
Other banking fees		1,304	1,091
Commissions (a)		1,773	1,770
Fiduciary and asset management fees (a)		2,392	2,221
Advisory, underwriting and other investment banking fees		912	784
Trading account profits (a)		506	317
Principal investing		383	266
Securities gains		71	163
Other income (a)		1,390	1,022
Total fee and other income		10,565	9,230
NONINTEREST EXPENSE
Salaries and employee benefits		7,880	7,201
Occupancy		850	781
Equipment		870	810
Advertising		157	142
Communications and supplies		487	478
Professional and consulting fees		551	449
Other intangible amortization		282	323
Merger-related and restructuring expenses		130	234
Sundry expense		1,338	1,246
Total noninterest expense		12,545	11,664
Minority interest in income of consolidated subsidiaries		289	239
Income before income taxes		8,175	7,317
Income taxes		2,685	2,381
Net income	$	5,490	4,936
PER COMMON SHARE DATA
Basic earnings	$	3.49	3.16
Diluted earnings		3.43	3.10
Cash dividends	$	1.58	1.43
AVERAGE COMMON SHARES
Basic		1,571	1,561
Diluted		1,600	1,590

(a) Amounts presented in 2005 have been reclassified to conform to the presentation in 2006.

PAGE 13

WACHOVIA CORPORATION AND SUBSIDIARIES

BUSINESS SEGMENTS

(Unaudited)

	Three Months Ended September 30, 2006
(In millions)	General Bank		Capital Management		Wealth Management	Corporate and Investment Bank		Parent		Net Merger- Related and Restructuring Expenses (b)		Total
CONSOLIDATED
Net interest income (a)	$	2,823	247		149	482		(123	)	(37	)	3,541
Fee and other income		902	1,230		199	989		145		—		3,465
Intersegment revenue		48	(8	)	1	(43	)	2		—		—
Total revenue (a)		3,773	1,469		349	1,428		24		(37	)	7,006
Provision for credit losses		123	—		—	(5	)	(10	)	—		108
Noninterest expense		1,689	1,095		237	791		195		38		4,045
Minority interest		—	—		—	—		104		—		104
Income taxes (benefits)		704	137		41	229		(226	)	(13	)	872
Tax-equivalent adjustment		11	—		—	9		17		(37	)	—
Net income (loss)	$	1,246	237		71	404		(56	)	(25	)	1,877
	Three Months Ended June 30, 2006
(In millions)	General Bank		Capital Management		Wealth Management	Corporate and Investment Bank		Parent		Net Merger- Related and Restructuring Expenses (b)		Total
CONSOLIDATED
Net interest income (a)	$	2,786	259		151	507		(28	)	(34	)	3,641
Fee and other income		857	1,222		197	1,215		92		—		3,583
Intersegment revenue		48	(9	)	1	(42	)	2		—		—
Total revenue (a)		3,691	1,472		349	1,680		66		(34	)	7,224
Provision for credit losses		95	—		2	(33	)	(5	)	—		59
Noninterest expense		1,752	1,116		252	878		239		24		4,261
Minority interest		—	—		—	—		89		1		90
Income taxes (benefits)		663	129		34	300		(187	)	(10	)	929
Tax-equivalent adjustment		10	1		—	9		14		(34	)	—
Net income (loss)	$	1,171	226		61	526		(84	)	(15	)	1,885

PAGE 14

WACHOVIA CORPORATION AND SUBSIDIARIES

BUSINESS SEGMENTS

(Unaudited)

	Three Months Ended September 30, 2005
(In millions)	General Bank		Capital Management		Wealth Management	Corporate and Investment Bank		Parent		Net Merger- Related and Restructuring Expenses (b)		Total
CONSOLIDATED
Net interest income (a)	$	2,379	211		146	532		172		(53	)	3,387
Fee and other income		760	1,146		196	1,027		129		—		3,258
Intersegment revenue		53	(9	)	1	(45	)	—		—		—
Total revenue (a)		3,192	1,348		343	1,514		301		(53	)	6,645
Provision for credit losses		77	—		6	(3	)	2		—		82
Noninterest expense		1,575	1,067		241	808		230		83		4,004
Minority interest		—	—		—	—		105		(1	)	104
Income taxes (benefits)		555	101		34	242		(111	)	(31	)	790
Tax-equivalent adjustment		10	1		—	21		21		(53	)	—
Net income	$	975	179		62	446		54		(51	)	1,665

(a) Tax-equivalent.

(b) The tax-equivalent amounts are eliminated herein in order for “Total” amounts to agree with amounts appearing in the Consolidated Statements of Income.

PAGE 15

WACHOVIA CORPORATION AND SUBSIDIARIES

LOANS—ON-BALANCE SHEET, AND MANAGED AND SERVICING PORTFOLIOS

(Unaudited)

	2006				2005
(In millions)	Third Quarter		Second Quarter	First Quarter	Fourth Quarter	Third Quarter
ON-BALANCE SHEET LOAN PORTFOLIO COMMERCIAL
Commercial, financial and agricultural	$	95,281	91,737	89,138	87,327	83,241
Real estate—construction and other		16,067	15,329	14,483	13,972	13,653
Real estate—mortgage		19,455	19,745	20,066	19,966	19,864
Lease financing		25,253	25,194	25,238	25,368	25,022
Foreign		12,677	11,680	11,535	10,221	8,888
Total commercial		168,733	163,685	160,460	156,854	150,668
CONSUMER
Real estate secured		100,115	98,420	98,898	94,748	80,128
Student loans		9,175	9,139	10,555	9,922	11,458
Installment loans		21,454	20,508	20,189	6,751	6,745
Total consumer		130,744	128,067	129,642	111,421	98,331
Total loans		299,477	291,752	290,102	268,275	248,999
Unearned income		8,718	8,836	9,170	9,260	9,266
Loans, net(On-balance sheet)	$	290,759	282,916	280,932	259,015	239,733
MANAGED PORTFOLIO (a)
COMMERCIAL
On-balance sheet loan portfolio	$	168,733	163,685	160,460	156,854	150,668
Securitized loans—off-balance sheet		218	250	1,191	1,227	1,263
Loans held for sale		5,556	3,602	3,588	3,860	4,039
Total commercial		174,507	167,537	165,239	161,941	155,970
CONSUMER
Real estate secured
On-balance sheet loan portfolio		100,115	98,420	98,898	94,748	80,128
Securitized loans—off-balance sheet		6,151	6,833	7,598	8,438	9,255
Securitized loans included in securities		6,611	6,878	4,628	4,817	4,218
Loans held for sale		3,324	3,843	3,679	2,296	12,660
Total real estate secured		116,201	115,974	114,803	110,299	106,261
Student
On-balance sheet loan portfolio		9,175	9,139	10,555	9,922	11,458
Securitized loans—off-balance sheet		3,218	3,353	1,866	2,000	341
Securitized loans included in securities		52	52	52	52	—
Total student		12,445	12,544	12,473	11,974	11,799
Installment
On-balance sheet loan portfolio		21,454	20,508	20,189	6,751	6,745
Securitized loans—off-balance sheet		3,695	3,809	3,297	3,392	2,228
Securitized loans included in securities		169	181	193	206	146
Loans held for sale		159	305	592	249	1,339
Total installment		25,477	24,803	24,271	10,598	10,458
Total consumer		154,123	153,321	151,547	132,871	128,518
Total managed portfolio	$	328,630	320,858	316,786	294,812	284,488
SERVICING PORTFOLIO (b)
Commercial	$	227,899	212,500	192,367	173,428	158,650
Consumer	$	60,854	58,082	58,697	56,741	55,813

(a) The managed portfolio includes the on-balance sheet loan portfolio, loans securitized for which the retained interests are classified in securities on-balance sheet, loans held for sale on-balance sheet and the off-balance sheet portfolio of securitized loans sold, where we service the loans.

(b) The servicing portfolio consists of third party commercial and consumer loans for which our sole function is that of servicing the loans for the third parties.

PAGE 16

WACHOVIA CORPORATION AND SUBSIDIARIES

ALLOWANCE FOR LOAN LOSSES AND NONPERFORMING ASSETS

(Unaudited)

	2006							2005
(In millions)	Third Quarter			Second Quarter		First Quarter		Fourth Quarter		Third Quarter
ALLOWANCE FOR LOAN LOSSES (a)
Balance, beginning of period	$	3,021		3,036		2,724		2,719		2,718
Provision for credit losses		118		49		59		72		74
Provision for credit losses relating to loans transferred to loans held for sale or sold		(4	)	5		—		5		12
Balance of acquired entities at purchase date		—		—		300		—		—
Allowance relating to loans acquired, transferred to loans held for sale or sold		(15	)	(18	)	12		(21	)	(26	)
Net charge-offs		(116	)	(51	)	(59	)	(51	)	(59	)
Balance, end of period	$	3,004		3,021		3,036		2,724		2,719
as % of loans, net		1.03	%	1.07		1.08		1.05		1.13
as % of nonaccrual and restructured loans (b)		520	%	488		452		439		347
as % of nonperforming assets (b)		396	%	421		389		378		303
LOAN LOSSES
Commercial, financial and agricultural	$	25		32		27		52		43
Commercial real estate—construction and mortgage		2		3		7		12		9
Consumer		149		116		69		65		71
Total loan losses		176		151		103		129		123
LOAN RECOVERIES
Commercial, financial and agricultural		14		54		16		50		35
Commercial real estate—construction and mortgage		1		1		—		3		2
Consumer		45		45		28		25		27
Total loan recoveries		60		100		44		78		64
Net charge-offs	$	116		51		59		51		59
Commercial loans net charge-offs as % of average commercial loans, net (c)		0.03	%	(0.06	)	0.05		0.03		0.05
Consumer loans net charge-offs as % of average consumer loans, net (c)		0.32		0.23		0.14		0.16		0.18
Total net charge-offs as % of average loans, net (c)		0.16	%	0.08		0.09		0.09		0.10
NONPERFORMING ASSETS
Nonaccrual loans
Commercial, financial and agricultural	$	275		299		342		307		445
Commercial real estate—construction and mortgage		80		88		84		85		120
Consumer real estate secured		213		226		240		221		209
Installment loans		10		6		6		7		10
Total nonaccrual loans		578		619		672		620		784
Foreclosed properties (d)		181		99		108		100		112
Total nonperforming assets	$	759		718		780		720		896
Nonperforming loans included in loans held for sale (e)	$	23		23		24		32		59
Nonperforming assets included in loans and in loans held for sale	$	782		741		804		752		955
as % of loans, net, and foreclosed properties (b)		0.26	%	0.25		0.28		0.28		0.37
as % of loans, net, foreclosed properties and loans held for sale (e)		0.26	%	0.25		0.28		0.28		0.37
Accruing loans past due 90 days	$	666		624		610		625		525

(a) At September 30, 2006, the reserve for unfunded lending commitments was $159 million.

(b) These ratios do not include nonperforming loans included in loans held for sale.

(c) Annualized.

(d) Restructured loans are not significant.

(e) These ratios reflect nonperforming loans included in loans held for sale. Loans held for sale are recorded at the lower of cost or market value, and accordingly, the amounts shown and included in the ratios are net of the transferred allowance for loan losses and the lower of cost or market value adjustments.

PAGE 17

WACHOVIA CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(Unaudited)

	2006							2005
(In millions, except per share data)	Third Quarter			Second Quarter		First Quarter		Fourth Quarter		Third Quarter
ASSETS
Cash and due from banks	$	11,850		12,761		12,668		15,072		12,976
Interest-bearing bank balances		5,270		2,244		1,563		2,638		2,492
Federal funds sold and securities purchased under resale agreements		18,497		17,223		18,807		19,915		27,083
Total cash and cash equivalents		35,617		32,228		33,038		37,625		42,551
Trading account assets		43,904		46,552		39,385		42,704		49,646
Securities		107,826		120,453		118,818		114,889		117,195
Loans, net of unearned income		290,759		282,916		280,932		259,015		239,733
Allowance for loan losses		(3,004	)	(3,021	)	(3,036	)	(2,724	)	(2,719	)
Loans, net		287,755		279,895		277,896		256,291		237,014
Loans held for sale		9,039		7,750		7,859		6,405		18,038
Premises and equipment		5,536		5,322		5,194		4,910		5,352
Due from customers on acceptances		1,200		1,010		968		824		882
Goodwill		23,535		23,550		23,443		21,807		21,857
Other intangible assets		1,355		1,435		1,523		1,208		1,285
Other assets		44,155		35,419		33,718		34,092		38,561
Total assets	$	559,922		553,614		541,842		520,755		532,381
LIABILITIES AND STOCKHOLDERS’ EQUITY
Deposits
Noninterest-bearing deposits		63,880		66,388		67,365		67,487		68,402
Interest-bearing deposits		259,418		261,226		261,199		257,407		252,037
Total deposits		323,298		327,614		328,564		324,894		320,439
Short-term borrowings		58,749		62,787		55,390		61,953		78,184
Bank acceptances outstanding		1,213		1,021		985		892		932
Trading account liabilities		19,553		18,409		17,846		17,598		19,815
Other liabilities		16,513		17,305		16,070		15,986		16,504
Long-term debt		86,419		74,627		70,218		48,971		45,846
Total liabilities		505,745		501,763		489,073		470,294		481,720
Minority interest in net assets of consolidated subsidiaries		2,997		2,979		2,980		2,900		3,904
STOCKHOLDERS’ EQUITY
Dividend Equalization Preferred shares, no par value, 97 million shares issued and outstanding at September 30, 2006		—		—		—		—		—
Non-Cumulative Perpetual Class A Preferred Stock, Series I, $100,000 liquidation preference per share, 25,010 shares authorized		—		—		—		—		—
Common stock, $3.33-1/3 par value; authorized 3 billion shares, outstanding 1.581 billion shares at September 30, 2006		5,271		5,298		5,362		5,189		5,178
Paid-in capital		34,276		34,086		34,291		31,172		30,821
Retained earnings		12,696		12,003		11,724		11,973		11,086
Accumulated other comprehensive income, net		(1,063	)	(2,515	)	(1,588	)	(773	)	(328	)
Total stockholders’ equity		51,180		48,872		49,789		47,561		46,757
Total liabilities and stockholders’ equity	$	559,922		553,614		541,842		520,755		532,381

PAGE 18

WACHOVIA CORPORATION AND SUBSIDIARIES

NET INTEREST INCOME SUMMARIES

(Unaudited)

	THIRD QUARTER 2006						SECOND QUARTER 2006
(In millions)	Average Balances		Interest Income/ Expense		Average Rates Earned/ Paid		Average Balances		Interest Income/ Expense		Average Rates Earned/ Paid
ASSETS
Interest-bearing bank balances	$	2,671		34	5.07	%	$	2,027		25	5.04	%
Federal funds sold and securities purchased under resale agreements		17,530		224	5.08			17,628		209	4.75
Trading account assets		31,160		409	5.24			29,252		393	5.37
Securities		122,152		1,661	5.44			124,102		1,668	5.38
Loans
Commercial
Commercial, financial and agricultural		93,886		1,673	7.07			90,259		1,555	6.92
Real estate—construction and other		15,787		308	7.74			14,946		277	7.43
Real estate—mortgage		19,507		378	7.69			20,118		369	7.36
Lease financing		9,731		172	7.04			9,895		175	7.08
Foreign		11,655		158	5.37			11,123		142	5.10
Total commercial		150,566		2,689	7.09			146,341		2,518	6.90
Consumer
Real estate secured		99,669		1,670	6.69			97,377		1,584	6.51
Student loans		9,605		161	6.65			10,842		170	6.30
Installment loans		21,270		517	9.66			20,705		482	9.33
Total consumer		130,544		2,348	7.17			128,924		2,236	6.95
Total loans		281,110		5,037	7.13			275,265		4,754	6.92
Loans held for sale		12,130		214	6.99			9,320		165	7.11
Other earning assets		5,386		113	8.35			5,638		99	7.00
Total earning assets excluding derivatives		472,139		7,692	6.49			463,232		7,313	6.32
Risk management derivatives (a)		—		129	0.11			—		125	0.11
Total earning assets including derivatives		472,139		7,821	6.60			463,232		7,438	6.43
Cash and due from banks		11,973						12,055
Other assets		71,052						68,325
Total assets	$	555,164					$	543,612
LIABILITIES AND STOCKHOLDERS’ EQUITY
Interest-bearing deposits
Savings and NOW accounts		75,534		355	1.86			78,539		332	1.70
Money market accounts		99,788		862	3.43			99,212		764	3.09
Other consumer time		52,352		548	4.15			48,389		465	3.85
Foreign		20,599		244	4.70			21,031		234	4.47
Other time		14,534		191	5.23			15,269		197	5.16
Total interest-bearing deposits		262,807		2,200	3.32			262,440		1,992	3.04
Federal funds purchased and securities sold under repurchase agreements		51,314		629	4.86			48,732		543	4.47
Commercial paper		5,190		63	4.77			4,659		51	4.45
Securities sold short		8,951		82	3.61			9,255		74	3.21
Other short-term borrowings		5,575		30	2.14			6,423		36	2.24
Long-term debt		80,726		1,095	5.41			71,725		940	5.25
Total interest-bearing liabilities excluding derivatives		414,563		4,099	3.93			403,234		3,636	3.62
Risk management derivatives (a)		—		144	0.14			—		127	0.12
Total interest-bearing liabilities including derivatives		414,563		4,243	4.07			403,234		3,763	3.74
Noninterest-bearing deposits		63,553						65,498
Other liabilities		26,905						25,817
Stockholders’ equity		50,143						49,063
Total liabilities and stockholders’ equity	$	555,164					$	543,612
Interest income and rate earned—including derivatives			$	7,821	6.60	%			$	7,438	6.43	%
Interest expense and equivalent rate paid—including derivatives				4,243	3.57					3,763	3.25
Net interest income and margin—including derivatives			$	3,578	3.03	%			$	3,675	3.18	%

(a) The rates earned and the rates paid on risk management derivatives are based on off-balance sheet notional amounts. The fair value of these instruments is included in other assets and other liabilities.

PAGE 19

WACHOVIA CORPORATION AND SUBSIDIARIES

NET INTEREST INCOME SUMMARIES

(Unaudited)

FIRST QUARTER 2006						FOURTH QUARTER 2005						THIRD QUARTER 2005
Average Balances		Interest Income/ Expense		Average Rates Earned/ Paid		Average Balances		Interest Income/ Expense		Average Rates Earned/ Paid		Average Balances		Interest Income/ Expense		Average Rates Earned/ Paid
$	2,872		31	4.31	%	$	2,514		24	3.75	%	$	2,417		21	3.46	%
	19,657		209	4.31			22,647		237	4.17			24,451		216	3.50
	27,240		344	5.08			34,461		482	5.59			33,720		407	4.82
	117,944		1,557	5.28			115,557		1,506	5.21			114,902		1,461	5.08
	87,784		1,411	6.51			85,155		1,326	6.17			81,488		1,184	5.77
	14,184		243	6.95			13,803		226	6.51			13,322		201	5.96
	20,166		350	7.04			20,132		333	6.57			19,684		302	6.09
	10,050		171	6.81			10,153		184	7.26			9,979		178	7.15
	10,285		118	4.67			9,118		97	4.23			8,164		80	3.88
	142,469		2,293	6.52			138,361		2,166	6.22			132,637		1,945	5.82
	96,082		1,514	6.31			80,984		1,236	6.10			78,088		1,166	5.97
	10,589		157	6.00			11,235		155	5.46			11,267		144	5.07
	11,434		242	8.57			6,902		127	7.32			6,968		124	7.04
	118,105		1,913	6.50			99,121		1,518	6.11			96,323		1,434	5.94
	260,574		4,206	6.51			237,482		3,684	6.17			228,960		3,379	5.87
	8,274		128	6.24			17,646		270	6.10			16,567		244	5.90
	5,966		118	8.04			8,897		155	6.92			10,329		138	5.27
	442,527		6,593	6.00			439,204		6,358	5.77			431,346		5,866	5.42
	—		163	0.15			—		184	0.16			—		231	0.21
	442,527		6,756	6.15			439,204		6,542	5.93			431,346		6,097	5.63
	12,762						12,770						12,277
	66,920						68,408						67,944
$	522,209					$	520,382					$	511,567
	79,783		304	1.54			78,936		258	1.30			78,961		220	1.10
	99,632		670	2.73			100,999		609	2.39			97,746		529	2.15
	46,309		407	3.57			43,549		369	3.37			41,063		325	3.13
	19,330		187	3.92			17,464		157	3.56			15,285		123	3.18
	13,286		153	4.67			14,859		166	4.46			10,338		109	4.21
	258,340		1,721	2.70			255,807		1,559	2.42			243,393		1,306	2.13
	50,087		503	4.07			55,336		526	3.77			56,426		460	3.24
	4,193		41	3.93			8,062		76	3.74			12,664		108	3.39
	8,520		63	3.01			8,801		70	3.13			9,040		77	3.38
	7,214		40	2.26			7,164		39	2.18			6,471		29	1.80
	56,052		697	4.99			47,804		576	4.81			47,788		536	4.48
	384,406		3,065	3.23			382,974		2,846	2.95			375,782		2,516	2.66
	—		152	0.16			—		121	0.13			—		141	0.15
	384,406		3,217	3.39			382,974		2,967	3.08			375,782		2,657	2.81
	64,490						64,018						62,978
	25,387						26,983						25,479
	47,926						46,407						47,328
$	522,209					$	520,382					$	511,567
		$	6,756	6.15	%			$	6,542	5.93	%			$	6,097	5.63	%
			3,217	2.94					2,967	2.68					2,657	2.45
		$	3,539	3.21	%			$	3,575	3.25	%			$	3,440	3.18	%

PAGE 20

WACHOVIA CORPORATION AND SUBSIDIARIES

NET INTEREST INCOME SUMMARIES

(Unaudited)

	NINE MONTHS ENDED SEPTEMBER 30, 2006						NINE MONTHS ENDED SEPTEMBER 30, 2005
(In millions)	Average Balances		Interest Income/ Expense		Average Rates Earned/ Paid		Average Balances		Interest Income/ Expense		Average Rates Earned/ Paid
ASSETS
Interest-bearing bank balances	$	2,523		90	4.77	%	$	2,516		57	3.05	%
Federal funds sold and securities purchased under resale agreements		18,264		642	4.70			24,467		558	3.05
Trading account assets		29,232		1,146	5.23			33,577		1,186	4.71
Securities		121,415		4,886	5.37			114,956		4,407	5.11
Loans
Commercial
Commercial, financial and agricultural		90,666		4,639	6.84			79,469		3,228	5.43
Real estate—construction and other		14,978		828	7.39			12,941		534	5.51
Real estate—mortgage		19,928		1,097	7.36			20,205		861	5.70
Lease financing		9,891		518	6.98			10,246		543	7.07
Foreign		11,026		418	5.06			7,669		206	3.59
Total commercial		146,489		7,500	6.84			130,530		5,372	5.50
Consumer
Real estate secured		97,722		4,768	6.51			75,861		3,275	5.76
Student loans		10,342		488	6.31			11,089		393	4.74
Installment loans		17,839		1,241	9.30			7,221		361	6.69
Total consumer		125,903		6,497	6.89			94,171		4,029	5.71
Total loans		272,392		13,997	6.86			224,701		9,401	5.59
Loans held for sale		9,922		507	6.82			14,500		604	5.56
Other earning assets		5,660		330	7.79			10,296		378	4.90
Total earning assets excluding derivatives		459,408		21,598	6.28			425,013		16,591	5.21
Risk management derivatives (a)		—		417	0.12			—		775	0.25
Total earning assets including derivatives		459,408		22,015	6.40			425,013		17,366	5.46
Cash and due from banks		12,260						12,441
Other assets		68,781						67,724
Total assets	$	540,449					$	505,178
LIABILITIES AND STOCKHOLDERS’ EQUITY
Interest-bearing deposits
Savings and NOW accounts		77,937		991	1.70			80,041		575	0.96
Money market accounts		99,545		2,296	3.08			95,420		1,341	1.88
Other consumer time		49,038		1,420	3.87			38,395		837	2.91
Foreign		20,325		665	4.38			12,728		265	2.78
Other time		14,367		541	5.03			10,966		270	3.29
Total interest-bearing deposits		261,212		5,913	3.03			237,550		3,288	1.85
Federal funds purchased and securities sold under repurchase agreements		50,049		1,675	4.47			53,954		1,147	2.84
Commercial paper		4,684		155	4.41			13,191		287	2.91
Securities sold short		8,910		219	3.28			10,776		271	3.37
Other short-term borrowings		6,399		106	2.22			6,511		85	1.75
Long-term debt		69,591		2,732	5.24			47,764		1,557	4.35
Total interest-bearing liabilities excluding derivatives		400,845		10,800	3.60			369,746		6,635	2.40
Risk management derivatives (a)		—		423	0.14			—		406	0.14
Total interest-bearing liabilities including derivatives		400,845		11,223	3.74			369,746		7,041	2.54
Noninterest-bearing deposits		64,510						61,906
Other liabilities		26,042						26,301
Stockholders’ equity		49,052						47,225
Total liabilities and stockholders’ equity	$	540,449					$	505,178
Interest income and rate earned—including derivatives			$	22,015	6.40	%			$	17,366	5.46	%
Interest expense and equivalent rate paid—including derivatives				11,223	3.27					7,041	2.22
Net interest income and margin—including derivatives			$	10,792	3.13	%			$	10,325	3.24	%

(a) The rates earned and the rates paid on risk management derivatives are based on off-balance sheet notional amounts. The fair value of these instruments is included in other assets and other liabilities.

PAGE 21

WACHOVIA CORPORATION AND SUBSIDIARIES

RECONCILIATION OF CERTAIN NON-GAAP FINANCIAL MEASURES

(Unaudited)

		2006							2005
(In millions, except per share data)	*	Third Quarter			Second Quarter		First Quarter		Fourth Quarter		Third Quarter
INCOME FROM CONTINUING OPERATIONS
Net income(GAAP)	A	$	1,877		1,885		1,728		1,707		1,665
Discontinued operations, net of income taxes(GAAP)			—		—		—		(214	)	—
Income from continuing operations(GAAP)			1,877		1,885		1,728		1,493		1,665
Merger-related and restructuring expenses(GAAP)			25		15		46		37		51
Earnings excluding merger-related and restructuring expenses, and discontinued operations	B		1,902		1,900		1,774		1,530		1,716
Other intangible amortization(GAAP)			59		64		59		57		63
Earnings excluding merger-related and restructuring expenses, other intangible amortization and discontinued operations	C	$	1,961		1,964		1,833		1,587		1,779
RETURN ON AVERAGE COMMON STOCKHOLDERS’ EQUITY
Average common stockholders’ equity(GAAP)	D	$	50,143		49,063		47,926		46,407		47,328
Merger-related and restructuring expenses (GAAP)			70		50		19		146		96
Discontinued operations(GAAP)			—		—		—		(36	)	—
Average common stockholders’ equity, excluding merger-related and restructuring expenses, and discontinued operations	E		50,213		49,113		47,945		46,517		47,424
Average intangible assets(GAAP)	F		(24,943	)	(24,972	)	(23,689	)	(23,302	)	(23,195	)
Average common stockholders’ equity, excluding merger-related and restructuring expenses, other intangible amortization and discontinued operations	G	$	25,270		24,141		24,256		23,215		24,229
Return on average common stockholders’ equity
GAAP	A/D		14.85	%	15.41		14.62		14.60		13.95
Excluding merger-related and restructuring expenses, and discontinued operations	B/E		15.02		15.52		15.01		13.05		14.36
Return on average tangible common stockholders’ equity
GAAP	A/D+F		29.55		31.38		28.91		29.33		27.36
Excluding merger-related and restructuring expenses, other intangible amortization and discontinued operations	C/G		30.79	%	32.63		30.64		27.11		29.14
RETURN ON AVERAGE ASSETS
Average assets(GAAP)	H	$	555,164		543,612		522,209		520,382		511,567
Average intangible assets(GAAP)			(24,943	)	(24,972	)	(23,689	)	(23,302	)	(23,195	)
Average tangible assets(GAAP)	I		530,221		518,640		498,520		497,080		488,372
Average assets(GAAP)			555,164		543,612		522,209		520,382		511,567
Merger-related and restructuring expenses(GAAP)			70		50		19		146		96
Discontinued operations(GAAP)			—		—		—		(36	)	—
Average assets, excluding merger-related and restructuring expenses, and discontinued operations	J		555,234		543,662		522,228		520,492		511,663
Average intangible assets(GAAP)			(24,943	)	(24,972	)	(23,689	)	(23,302	)	(23,195	)
Average tangible assets, excluding merger-related and restructuring expenses, and discontinued operations	K	$	530,291		518,690		498,539		497,190		488,468
Return on average assets
GAAP	A/H		1.34	%	1.39		1.34		1.30		1.29
Excluding merger-related and restructuring expenses, and discontinued operations	B/J		1.36		1.40		1.38		1.17		1.33
Return on average tangible assets
GAAP	A/I		1.40		1.46		1.41		1.36		1.35
Excluding merger-related and restructuring expenses, other intangible amortization and discontinued operations	C/K		1.47	%	1.52		1.49		1.27		1.45

PAGE 22

WACHOVIA CORPORATION AND SUBSIDIARIES

RECONCILIATION OF CERTAIN NON-GAAP FINANCIAL MEASURES

(Unaudited)

		2006							2005
(In millions, except per share data)	*	Third Quarter			Second Quarter		First Quarter		Fourth Quarter		Third Quarter
OVERHEAD EFFICIENCY RATIOS
Noninterest expense(GAAP)	L	$	4,045		4,261		4,239		4,183		4,004
Merger-related and restructuring expenses(GAAP)			(38	)	(24	)	(68	)	(58	)	(83	)
Noninterest expense, excluding merger-related and restructuring expenses	M		4,007		4,237		4,171		4,125		3,921
Other intangible amortization(GAAP)			(92	)	(98	)	(92	)	(93	)	(101	)
Noninterest expense, excluding merger-related and restructuring expenses, and other intangible amortization	N	$	3,915		4,139		4,079		4,032		3,820
Net interest income(GAAP)		$	3,541		3,641		3,490		3,523		3,387
Tax-equivalent adjustment			37		34		49		52		53
Net interest income(Tax-equivalent)			3,578		3,675		3,539		3,575		3,440
Fee and other income(GAAP)			3,465		3,583		3,517		2,989		3,258
Total	O	$	7,043		7,258		7,056		6,564		6,698
Retail Brokerage Services, excluding insurance
Noninterest expense(GAAP)	P	$	891		920		946		894		878
Net interest income(GAAP)		$	239		250		241		226		204
Tax-equivalent adjustment			—		1		—		—		1
Net interest income(Tax-equivalent)			239		251		241		226		205
Fee and other income(GAAP)			960		963		978		917		907
Total	Q	$	1,199		1,214		1,219		1,143		1,112
Overhead efficiency ratios
GAAP	L/O		57.44	%	58.71		60.07		63.72		59.78
Excluding merger-related and restructuring expenses	M/O		56.90		58.39		59.10		62.84		58.55
Excluding merger-related and restructuring expenses, and brokerage	M-P/O-Q		53.32		54.89		55.23		59.58		54.49
Excluding merger-related and restructuring expenses, and other intangible amortization	N/O		55.60		57.03		57.81		61.41		57.06
Excluding merger-related and restructuring expenses, other intangible amortization and brokerage	N-P/O-Q		51.76	%	53.26		53.67		57.85		52.70
OPERATING LEVERAGE
Operating leverage(GAAP)		$	1		180		436		(312	)	92
Merger-related and restructuring expenses(GAAP)			15		(45	)	10		(25	)	(8	)
Operating leverage, excluding merger-related and restructuring expenses			16		135		446		(337	)	84
Other intangible amortization(GAAP)			(8	)	7		(2	)	(6	)	(7	)
Operating leverage, excluding merger-related and restructuring expenses, and other intangible amortization		$	8		142		444		(343	)	77
DIVIDEND PAYOUT RATIOS ON COMMON SHARES
Dividends paid per common share	R	$	0.56		0.51		0.51		0.51		0.51
Diluted earnings per common share(GAAP)	S	$	1.17		1.17		1.09		1.09		1.06
Merger-related and restructuring expenses(GAAP)			0.02		0.01		0.03		0.02		0.03
Other intangible amortization(GAAP)			0.04		0.04		0.04		0.04		0.04
Discontinued operations(GAAP)			—		—		—		(0.14	)	—
Diluted earnings per common share, excluding merger-related and restructuring expenses, other intangible amortization and discontinued operations	T	$	1.23		1.22		1.16		1.01		1.13
Dividend payout ratios
GAAP	R/S		47.86	%	43.59		46.79		46.79		48.11
Excluding merger-related and restructuring expenses, other intangible amortization and discontinued operations	R/T		45.53	%	41.80		43.97		50.50		45.13

* The letters included in the columns are provided to show how the various ratios presented in the tables on pages 21 and 22 are calculated. For example, return on average assets on a GAAP basis is calculated by dividing income (GAAP) by average assets (GAAP) (i.e., A/H) and annualized where appropriate.