UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): June 3, 2004 (June 3, 2004)
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SunTrust Banks, Inc.
(Exact Name of Registrant as Specified in Charter)
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| Georgia | | 001-08918 | | 58-1575035 | ||||||
| (State or Other Jurisdiction of Incorporation) | | (Commission File Number) | | (IRS Employer Identification No.) | ||||||
| 303 Peachtree Street, N.E. Atlanta, Georgia | | 30308 | ||||||||
| (Address of Principal Executive Offices) | | (Zip Code) | ||||||||
| Registrant's telephone number, including area code | | 404-588-7165 | ||||||||
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Not Applicable
(Former Name or Former Address, if Changed Since Last Report)
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| ITEM 9. | Regulation FD Disclosure. |
On June 3, 2004, SunTrust Banks, Inc. ("SunTrust") participated in the Sanford C. Bernstein Strategic Decisions Conference. The slide package used by SunTrust at this conference is furnished herewith as Exhibit 99.1 and incorporated by reference in Item 9.
The information in the preceding paragraph, as well as Exhibit 99.1 referenced therein, shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| SUNTRUST BANKS, INC. |
Date: June 3, 2004
| By:/s/ Raymond D. Fortin |
| Name: Raymond D. Fortin |
| Title: Senior Vice President |
| Exhibit 99.1 |
Strategically Focused
…on Performance
…on Growth
…on Opportunity
Sanford C. Bernstein
Strategic Decisions Conference
June 2004
L. Phillip Humann
William R. Reed, Jr.
Gary Peacock, Jr.
This presentation contains forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995. Such statements include, but are not limited to,
statements about the benefits of the merger between SunTrust Banks, Inc. (“SunTrust”)
and National Commerce Financial Corporation (“NCF”), including future financial and
operating results, SunTrust’s plans, objectives, expectations and intentions and other
statements that are not historical facts. Such statements are based upon the current
beliefs and expectations of SunTrust’s and NCF’s management and are subject to significant
risks and uncertainties. Actual results may differ from those set forth in the forward-
looking statements. The following factors, among others, could cause actual results to
differ from those set forth in the forward-looking statements: the ability to obtain
governmental approvals of the merger on the proposed terms and schedule; the failure of
SunTrust and NCF stockholders to approve the merger; the risk that the businesses will not
be integrated successfully; the risk that the cost savings and any revenue synergies from
the merger may not be fully realized or may take longer to realize than expected;
disruption from the merger making it more difficult to maintain relationships with clients,
employees or suppliers; increased competition and its effects on pricing, spending, third-
party relationships and revenues; the risk of new and changing regulation in the U.S. and
internationally. Additional factors that could cause SunTrust’s and NCF’s results to differ
materially from those described in the forward-looking statements can be found in the 2003
Annual Reports on Form 10-K of SunTrust and NCF, and in the Quarterly Reports on Form
10-Q of SunTrust and NCF filed with the Securities and Exchange Commission and available
at the Securities and Exchange Commission’s internet site (http://www.sec.gov). The
forward-looking statements in this presentation speak only as of the date of the filing, and
neither SunTrust nor NCF assumes any obligation to update the forward-looking statements
or to update the reasons why actual results could differ from those contained in the
forward-looking statements.
This presentation could include some non-GAAP measures to describe SunTrust’s
performance. The reconciliation of those measures to GAAP measures can be found in
SunTrust’s earnings press release, on SunTrust’s website in the press release section of
the Investor Relations pages and in the appendix of this presentation.
Stockholders are urged to read the joint proxy statement/prospectus regarding the
proposed transaction when it becomes available because it will contain important
information. Stockholders will be able to obtain a free copy of the joint proxy
statement/prospectus, as well as other filings containing information about SunTrust and
NCF, without charge, at the Securities and Exchange Commission’s internet site
(http://www.sec.gov). Copies of the joint proxy statement/prospectus and the filings with
the Securities and Exchange Commission that will be incorporated by reference in the joint
proxy statement/prospectus can also be obtained, without charge, by directing a request to
SunTrust Banks, Inc., 303 Peachtree St., N.E., Atlanta, Georgia 30308, Attention: Investor
Relations; or National Commerce Financial Corporation, One Commerce Square, Memphis,
Tennessee 38159, Attention: Investor Relations.
The respective directors and executive officers of SunTrust and NCF and other persons may
be deemed to be participants in the solicitation of proxies in respect of the proposed
merger. Information regarding SunTrust’s directors and executive officers is available in
the proxy statement filed with the Securities and Exchange Commission by SunTrust on
March 2, 2004, and information regarding NCF’s directors and executive officers is available
in the proxy statement filed with the Securities and Exchange Commission by NCF on March
17, 2004. Other information regarding the participants in the proxy solicitation and a
description of their direct and indirect interests, by security holdings or otherwise, will be
contained in the joint proxy statement/prospectus and other relevant materials to be filed
with the Securities and Exchange Commission when they become available.
whySunTrust?
Strategically focused on performance, growth and
opportunity
Our focus is showingresults
NCF merger provides newopportunities
performanceperspective
Pre 2000
2001 - 2003
2004 & beyond
Experienced double digit earnings per share growth
Strong economy in the Southeast
Solid equity markets
Investments in capital markets and growth in large corporate
loans paid off as credit losses remained low
Southeast economy not immune to economic slowdown
Record corporate charge offs, created negative impact to many
financial institutions including SunTrust
Shift in portfolio toward asset sensitivity, coupled with a shorter-
term duration & assuming a rising rate environment, resulted in
margin pressures
Economic rebound, stock market improvement and rising
rates augur well for future performance
Focus is on execution of our model and strategies;
momentum evident
NCF merger enhances geographic reach, retail capabilities
Strategic Focus
Enhanced
Franchise
One
Bank
Take
the Lead
Profit
Acceleration
1999
Focused on
efficiency,
ability to
deliver
common
customer
experience
Implemented
series of
operational
initiatives
Placed highest
priority on sales
and client
retention
Established high
performance as
the standard
Focused on
achieving
breakthrough
results
Introduced
new
geographic
structure and
operating
model
Aligned top
talent to key
leadership
positions
Intensified
local market,
client and
sales focus
Extended
footprint into
key growth
markets with
Mid Atlantic
acquisition
Collapsed 28
bank charters
Streamlined
administrative
structure
S3 and E2
Implemented
new revenue
initiatives in
key
businesses
Created
process
efficiencies
and
consistency
in key
business
lines
building forgrowth
2004
Strategic Focus
defining breakthroughresults
Double-digitrevenue growth
A leadingmarketshare in the
highest growth markets
Continued increase insales per
FTE per day andcross-LOB sales
Continuedexpense discipline–
operating leverage and efficiency
ratio improvement
Consistent, best-in-classcredit
quality
Investmentsfor future growth
Strong earnings
growth
Premium P/E
Solid stock
performance
leads to
Strategic Focus
our geographic approachdifferentiates
Delivery Scale/
Multiple Channels
Product Array
and Expertise
Ability to Serve
All Segments
True
Client Management
Personalized,
Quality Service
Decisions Close
to Customer
Deliver “Big Bank”
Capabilities
Local Decisions and
Responsiveness
with
Strategic Focus
our operatingmodel
Five Primary LOBs
Commercial (including
Real Estate)
Corporate and
Investment Banking
(including Capital
Markets)
Mortgage
Retail (including
Business Banking,
Private Banking and De
Novo Banking)
Private Client Services
Centralized Support areas
HR
Finance
Technology
Marketing
Credit
Efficiency and Quality
Four Groups
Central (primarily
Georgia and
Tennessee)
Carolina Group (North
and South Carolina)
Florida
Mid-Atlantic (primarily
DC, Maryland and
Virginia)
20+ Regions with a local
executive and dedicated
management team
50+ local banking markets
Run the business
“Strategy direction and
installation design”
Drive customer sales,
service and relationship
acquisition, expansion
and retention
“Excellence in
execution”
Provide expertise in their
respective disciplines
“Industry leading
competence”
STI LOBs
Geographies
STI Functions
Strategic Focus
Our business model brings advantages
to the customer, to STI and to our shareholders
operating modeladvantages
Clear vision and focus on corporate priorities
Better, quicker execution with more consistency
Lower cost of delivery through standardization
Ability to specialize in product development and delivery
Effective risk management on a consolidated basis
Broad view of talent and bench strength
Advantages to
the Customer
Advantages to
STI and Our Shareholders
Quality interactions and service
Personalized relationship management
Appropriate customization based on unique client
needs
Sophisticated products and services
Expertise from centrally managed operation
Consistency in the SunTrust experience
Strategic Focus
Sell
Serve
Sustain
Managing
Change
Continuous
Improvement
S3
E2
World classsales organization with
industry leading results
Differentiated by highquality
service
Committed toretaining customers
andbuilding relationships
Improving results, how we operate
and how we interact with each other
Installing new initiatives, adopting
new behaviors andaligning to our
operating model
salespriority
“Excellence in Execution”
Strategic Focus
earningsmomentum
Earnings growth accelerating
Net Income
Earnings per Share
Return on Avg. Assets
Return on Avg. Assets less net
unrealized gains on
securities portfolio(1)
Return on Avg. Equity
Return on Avg.
Realized Equity(1)
1Q 2004
1Q 2003
Change
$342.5
1.21
1.09
1.11
14.40
17.13
$327.8
1.17
1.12
1.15
15.13
18.16
9%
8%
4 b.p.
4 b.p.
(48) b.p.
(57) b.p.
(1)
Excludes net gains in Company’s security portfolio due to its ownership of 48.3 million shares of The Coca-Cola Company.
The Company believes this is a more indicative performance measure when being compared to other companies.
(2)
Annualized.
4Q 2003
Sequential
Change
1Q04 : 1Q03
1Q04 : 4Q03
19%
17%
7 b.p.
8 b.p.
25 b.p.
46 b.p.
$358.5
1.26
1.16
1.19
14.65
17.59
(2)
(2)
Results
fee incomegrowth
Fee income growth momentum continuing
Trust and Investment Mgmt.
Retail Investment
Deposit Charges
Mortgage Fees
Corp & Invst. Banking
Credit Card Fees
Other Charges & Fees
Other Non-interest income
Total Fees(1)
($ in millions)
$130
44
165
(1)
77
29
79
42
565
$136
46
163
7
74
32
93
39
590
13%
22%
3%
NM
15%
11%
18%
48%
17%
$121
37
158
(8)
65
29
78
26
506
20%
19%
(5)%
NM
(12)%
39%
67%
(29)%
18%
1Q 2003
1Q 2004
1Q2004:
1Q2003
4Q 2003
1Q04:4Q03
(Annualized)
(1)
Fees without Securities’ net gains.
Results
net interest incomepotential
Securities Portfolio Margin Profile – “Dry Powder”
(1)
Yields on investment securities available for sale. Does not include held-to-maturity securities or trading securities unless breakout is unavailable.
(2)
Assumes $25bn security portfolio, 35% tax rate, 280mm shares outstanding and 63 b.p. improvement in yield.
Source: Company Reports
One of the lowest
securities yields
among top 50
banks
Very short
duration
compared to
peers
Normalizing
securities yield to
historical relative
position adds
approximately
$102mm after-tax
or $0.36 per
share2
Yield Change (b.p.)
4Q 2001
1Q 2004
1Q2004:4Q2001
Wells Fargo
7.25
6.24
(101)
National City
5.10
5.26
16
Wachovia
6.49
4.97
(152)
Bank One
5.41
4.93
(48)
Bank of America
6.10
4.91
(119)
Fifth Third
7.39
4.40
(299)
KeyCorp
6.78
4.36
(242)
U.S. Bancorp
5.88
4.14
(174)
BB&T
6.77
4.04
(273)
PNC Financial
5.25
3.56
(169)
Average w/o SunTrust
6.24
4.68
(156)
SunTrust
6.02
3.83
(219)
STI Yield vs. Average
(22)
(85)
(63)
National Commerce
6.97
4.82
(215)
Securities Yields
1
Results
net interest margintrends
Margin has rebounded from lows experienced in 2003
Adjusted for impact of Three Pillars and the consolidation of certain Affordable Housing partnerships
Results
significant businessmomentum – loan growth
Note: All loan data reflects average balances over stated time period.
Results
Retail
Commercial
CIB
PCS
Mortgage
Total STI
Total (ex. CIB)
$25
22
15
2
16
80
65
$23
20
16
2
12
73
57
10.9%
6.5
(5.9)
22.6
29.5
9.4
13.6
Three Months
Ended March 31,
2004
2003
Y-o-Y
$ in billions
significant businessmomentum – deposit shift
Note: All deposit data reflects average balances over stated time period.
(1) Total of DDA, NOW and Savings
($ in billions)
2003
2002
2001
CAGR
2004
2003
Y-o-Y
DDA
$
18
$
15
$
13
15.0
%
$
19
$
16
16.7
%
NOW
12
10
8
17.5
12
11
8.9
MMA
22
20
16
18.5
22
22
1.3
Savings
6
6
6
1.6
6
6
1.9
CDs
11
13
13
(5.9)
11
12
(10.2)
Total
69
65
57
10.6
70
67
4.3
Total Low Cost
(1)
36
32
28
13.0
38
34
11.4
Year Ended December 31,
Three Months
Ended March 31,
Results
first quarter 2004 saleshighlights
Most Key Product Sales Are Up Double Digit Over Last Year
Retail
Equity Line/Loan
Products up25 %
Indirect Lending sales up
20%
Private Banking
consumer loan sales up
39%
Business Banking loan
production up30% ; Visa
sales up37%
Consumer credit cards
up 31%
New personal checking
up8% and closings down
3% vs. 4Q03
Retail Investment
referrals to PCS up27%
Commercial
Deposits up14%-- Loans
up almost7%
Treasury Management
sales up8%
STRH – Capital Markets /
Foreign Exchange fees up
34% over last year
CIB
Equity Fees up59%
Number of TM deals up
41%,dollars up 23%
Total Capital Markets
revenue up7%
Product penetration up
30%
PCS
Group Trust new business
up56%
Retail Investment sales up
24%
Improvement in New to
Lost Business Ratio for
Personal Trust improved
by76% - -12%
improvement in lost Trust
Business
Wealth Strategist
productivity up19%
Referrals to Retail up
133%
Mortgage
$12.5 billion in
applications,47% over
plan
$6.5 billion in closings,
10% over plan
Cross-sold over 33,000
target banking products –
up over180%over ‘03
STOLI
SunTrust Online
Loans/Lines up41%
Credit card sales up20%
Deposit accounts up
15%
Core sales per FTE/day
up 14%
Results
sti and ncfcombination…makes best footprint better
Financial scale
$25+bn market cap
$148bn assets
$97bn deposits
1,723 full-service offices
in 11 states plus D.C.
#3 in market share in
Southeast
Top 5 rank in 20 of 25
largest high growth
markets in Southeast
Adds meaningful
presence in some of
the highest growth
North Carolina and
South Carolina
markets
Solidifies positions in
Virginia and
Tennessee
Opportunity
“Best Footprint in
Banking”… just got
better”
“Best Footprint in
Banking”
Enhanced overall
growth rate
Expanded product
offering to be overlaid
across expanded
customer bases/
distribution systems
SunTrust
National Commerce
Pro Forma Result
The acquisition of National Commerce represents much more than a logical
geographic extension of SunTrust’s franchise
Large, high growth,
MSA–focused franchise
Entry into attractive
new markets—North
Carolina
Strong retail franchise
with leading de novo /
in-store expertise
Small business
Commercial RE
Mortgage
Large corporate/
middle market
Cash management/
trust
Asset management
Investment
banking/brokerage
Mortgage
Large retail franchise
Proven de novo growth
strategy
Entrepreneurial, high–
growth, revenue-based
culture
Focus on efficiency
Established/leader
ship positions in
high growth
markets
Greater capital
resources
compellingstrategic combination
Opportunity
create “best of breed”retail model
National Commerce Expertise
Customized pricing strategy
based on market maturity
Industry leading
in-store strategy
Proven de novo expertise
into new markets
SunTrust’s Large Retail Franchise
Households Served 3.8mm
Deposit Accounts 4.3mm
Loan Accounts 2.3mm
Retail Branches 1,207
In-store 153
ATMs 2,235
Retail Deposits $53.4bn
Opportunity
National Commerce’s in-store model represents
strength for combined enterprise
8
4
Employees
2,000
400-500
Square feet
1
2.3
Visits per week
3 thousand
16 – 24 thousand
Traffic per week
36 Months
18 Months
Breakeven
$400,000
$225,000
Operating
Expenses
$1-2 million
$200,000
Capex
In a stand-alone
bank branch
With an In-store
Partner
De novo in-store branch meets 8,000 of our competitor’s
customers within 1 week
Opportunity
Target high-population, high growth MSAs
Partner with the store that has leading market
share (#1 or #2), high weekly traffic volume and an
excellent reputation for service and quality
Identify locations where “hub” branches will be
easy to add
Train and incentivize the employees tosell
87% of total assets, excluding CCB merger,
obtained via de novo growth equating to a 15%
annualized de novo total asset growth
Strategy
Timeline
Start-up phase
Years 1—2
Deposits priced 50-100 bps above
local competition
Loan volumes are low and
deposits are reinvested in lower
yielding investment securities
ROA of 40-50 bps
ROE of 5-10%
Stage 1
High growth phase
Years 3—6
Deposit costs begin to decline
Loan volume increases
NIM expansion and improvement
in efficiency ratio
ROA of 1.00%-1.20%
ROE of 14%-17%
Stage 2
Mature phase
Years 7+
Deposit rates at market
Loan demand matches deposit
growth
Branch has reached a steady-
state growth
ROA of 1.50+%
ROE of 20+%
Stage 3
Source: National Commerce investor presentations
National Commerce Expansion History
Assets ($ millions)
18 Years
3 Years
National Commerce’s retail engine:
de novo branching expertise
Opportunity
National Commerce’s de novosuccess story
Opportunity
Partnered with America’s #1 Retailer
Wal-Mart’s sales on one day last fall - $1.42 billion – were larger than the GDPs of 36 countries
Store traffic of 35,000 - 50,000 customers per week
National Commerce’s de novosuccess story
Wal-Mart
Original 16 North Georgia Wal-Marts
Deposits $491,086; largest $68,760
Loans $78,275; largest $10,182
Average deposits – 30,700,000
Average loans – 4,900,000
Average pretax – April 2004 YTD annualized - $571,000
$0.03 per share annually for NCF
Opportunities for growth
16 new Wal-Mart Money Centers in North Georgia; 8 opened in
last sixty days
77 new Wal-Mart Super Centers; 55 in Florida; 22 in Southern
Georgia – will open starting in August 2004 through 2Q 2006
Evaluating additional locations for growth
Opportunity
core commercialopportunities
SunTrust has leading products and capabilities: #1 bank in
primary bank relationship in existing footprint
Overlapping SunTrust expertise within National Commerce
banking footprint results in highly significant middle market
opportunity
Estimated Number of Middle Market Companies in NCI Footprint
North Carolina 4,500+
South Carolina 900+
Opportunity
SunTrust’s wealth management model represents
strength for combined enterprise
Registered Representatives
Trusco AUM Growth
Investment Management Income
Superb New Customer Sales and Retention
Financial metrics strong given performance of overall equity
markets and when compared to peers
Opportunity
whySunTrust?
We areuniquely positioned to provide big bank resources through a
locally empowered management team
Our size enables us to take advantage ofeconomies of scale
We havethe best people – and we have a highly effective approach to
managing these top performers
Our people work effectively across business and product lines to build
lasting client relationships
We have thebest footprint – we are in some of the fastest growing
markets in the country
We consistently maintainbest-in-class credit quality
We have a firm commitment to shareholders demonstrated through
decades ofconsistent earnings and dividend growth
Bright prospect;positioned for the future
reconciliationsappendix
Return on Avg. Assets
Impact of excluding net unrealized
securities gains
Return on Avg. Assets less net unrealized
gains on securities portfolio
Return on Avg. Equity
Impact of excluding net unrealized
securities gains on securities portfolio
Return on Avg. Realized Equity
1.16%
0.03
1.19%
14.65%
2.94
17.59%
1Q 04
1.09%
0.02
1.11%
14.40%
2.73
17.13%
7 b.p.
1 b.p.
8 b.p.
25 b.p.
21 b.p.
46 b.p.
1.12
0.03
1.15%
15.13%
3.03
18.16%
4 b.p.
-
4 b.p.
(48) b.p.
(9) b.p.
(57) b.p.
4Q 03
Sequential
Change
1Q 04 vs 4Q 03
Change
1Q 04 vs 1Q 03
1Q 03
reconciliationsappendix
Net Interest Margin
Net Interest Margin Impact of
Three Pillars Consolidation
Net Interest Margin Impact of
Consolidation of certain Affordable
Housing partnerships
Net Interest Margin Adjusted for the Impact
of Three Pillars and Affordable Housing
1Q 04
3.13%
0.04%
0.01%
3.18%
4Q 03
3Q 03
3.09%
0.06%
0.01%
3.16%
2.98%
0.06%
0.02%
3.06%