Exhibit 99.1
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 | | News Release |
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| Contact: | | |
| Investors | | Media |
| Greg Ketron | | Barry Koling |
| (404) 827-6714 | | (404) 230-5268 |
For Immediate Release
July 19, 2007
SunTrust Second Quarter 2007 Earnings Reflect Positive Impact of
Shareholder Value Initiatives
Efficiency and Productivity Initiatives and Balance Sheet Management Strategies Contribute to
Earnings Per Share of $1.89; Includes $0.41 Per Share Gain on Partial Sale of The Coca-Cola
Company Stock
ATLANTA— SunTrust Banks, Inc. (NYSE: STI) today reported net income available to common shareholders for the second quarter of 2007 of $673.9 million compared to $544.0 million in the second quarter of 2006. Net income per average common diluted share was $1.89 compared to $1.49 in the second quarter of 2006. The results included a $145.6 million after-tax gain on sale of 4.5 million shares, or 9%, of the Company’s common stock holdings of The Coca-Cola Company (Coke). Excluding the gain on sale of Coke stock, net income available to common shareholders was $528.3 million, or $1.48 per average common diluted share, for the second quarter of 2007.
“We are pleased to report that our intensified and continuing focus on driving shareholder value contributed significantly to the Company’s performance in the second quarter,” said James M. Wells III, President and Chief Executive Officer of SunTrust. Mr. Wells noted that the shareholder value initiatives helped deliver positive operating leverage for the quarter, with solid revenue growth and strong expense management helping to offset the impact of higher credit costs.
The Company’s initiatives to drive shareholder value announced during the first half of this year include the E2 Efficiency and Productivity Program and balance sheet and capital management strategies. The E2 Efficiency and Productivity Program initiatives produced $51.8 million in cost savings for the second quarter of 2007, bringing the year-to-date cost savings to $80.6 million. The cost savings to date have primarily come from supplier management, offshoring/outsourcing, and process reengineering-related initiatives. Additional initiatives are either being implemented or are under review, and the expectation is that the program will produce $181 million in cost savings for the full year of 2007, $350 million in 2008, and $530 million in 2009, representing over 10% of the Company’s current full-year expense base.
The balance sheet and capital management strategies initiated in the first half of this year have resulted in selling or replacing lower-yielding investment securities and mortgage loans with higher-yielding assets, de-levering the balance sheet, and using the resulting capital flexibility to repurchase shares through an accelerated share repurchase program and open-market purchases, which together totaled over $850 million in the second quarter. The Company’s capital management strategies also included the partial liquidation of the Coke holdings during the second quarter and the evaluation of alternatives for the remaining 43.7 million shares.
Several of the Company’s key financial performance measures improved as a result of these initiatives, as the return on assets and equity, net interest margin, and the efficiency ratio improved in the second quarter from the first quarter of 2007.
Second Quarter 2007 Consolidated Highlights
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| | | 2nd Quarter
2007 | | 2nd Quarter
2006 | | %
Change | |
| | | | |
Income Statement | | | | | | | |
(Dollars in millions, except per share data) | | | | | | | |
Net income available to common shareholders | | $673.9 | | $544.0 | | 24 | % |
Net income available to common shareholders excluding Coke gain | | 528.3 | | 544.0 | | (3 | )% |
Net income per average common diluted share | | 1.89 | | 1.49 | | 27 | % |
Net income per average common diluted share excluding Coke gain | | 1.48 | | 1.49 | | (1 | )% |
Revenue – fully taxable-equivalent | | 2,374.6 | | 2,065.4 | | 15 | % |
Revenue – fully taxable-equivalent excluding Coke gain | | 2,139.8 | | 2,065.4 | | 4 | % |
Provision for loan losses | | 104.7 | | 51.8 | | 102 | % |
Noninterest income | | 1,154.6 | | 875.4 | | 32 | % |
Noninterest income excluding Coke gain | | 919.8 | | 875.4 | | 5 | % |
Noninterest expense | | 1,251.2 | | 1,214.1 | | 3 | % |
Net interest margin | | 3.10% | | 3.00% | | | |
Efficiency ratio | | 52.69% | | 58.78% | | | |
Efficiency ratio excluding Coke gain | | 58.47% | | 58.78% | | | |
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Balance Sheet | | | | | | | |
(Dollars in billions) | | | | | | | |
Average loans | | $118.2 | | $120.1 | | (2 | )% |
Average consumer and commercial deposits | | 97.9 | | 97.2 | | 1 | % |
| | | | |
Capital Tier 1 capital ratio(1) Total average shareholders’ equity to total average assets Tangible equity to tangible assets | | 7.5%
9.96%
5.85% | | 7.31%
9.57%
5.81% | | | |
| | | | |
Asset Quality Net charge-offs to average loans (annualized) Nonperforming loans to total loans | | 0.30%
0.64% | | 0.10%
0.27% | | | |
| | | | |
(1) Current period Tier 1 capital ratio is estimated as of the earnings release date. | | | | | | | |
| • | | Net income available to common shareholders increased 24% and net income per average common diluted share increased 27% from the second quarter of 2006, due to a $145.6 million after-tax gain on sale of Coke stock. Excluding this gain, net income available to common shareholders decreased 3% and net income per average common diluted share decreased 1% from the second quarter of 2006 as fully taxable-equivalent revenue growth outpaced expense growth; however, this net growth was not enough to offset the $52.9 million, or 102%, increase in provision for loan losses. |
| • | | Fully taxable-equivalent revenue increased 15% from the second quarter of 2006. Excluding the gain on sale of Coke stock, fully taxable-equivalent revenue increased 4% due to a 3% increase in fully taxable-equivalent net interest income and noninterest income growth of 5%. On a sequential annualized basis, excluding the gain on sale of Coke stock, fully taxable-equivalent revenue increased 14% from the first quarter of 2007. |
| • | | Fully taxable-equivalent net interest income increased 3% from the second quarter of 2006. Net interest margin for the second quarter of 2007 was 3.10%, a 10 basis point improvement from the second quarter of 2006. Compared to the first quarter of 2007, fully taxable-equivalent net interest income improved 11% on a sequential annualized basis and net interest margin improved 8 basis points. The increase in fully taxable-equivalent net interest income and net interest margin were largely the result of the balance sheet management strategies executed in the first and second quarters of 2007. |
| • | | Noninterest income growth from the second quarter of 2006 occurred across several categories, including increases in service charges on deposit accounts, retail investment services income, other charges and fees, card fees, mortgage production and servicing income, and other noninterest income, mainly due to gains generated on private equity investments and structured leasing transactions. |
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| • | | Noninterest expense increased 3% from the second quarter of 2006 due in part to the Company’s election to record certain newly-originated mortgage loans held-for-sale at fair value during the second quarter of 2007. This election resulted in a $12.4 million increase in compensation expense as origination costs associated with these loans are no longer deferred. Expense growth during the quarter was also affected by the reversal of a leverage leasing-related reserve in the second quarter of 2006 that reduced noninterest expense by $10.9 million in that period. Excluding the impact of these two items, expense growth was only 1%. |
| • | | The efficiency ratio benefited from the positive operating leverage generated in the second quarter of 2007. The efficiency ratio was 52.69% for the second quarter of 2007; excluding the gain on sale of Coke stock, it was 58.47%. Both ratios reflect improvement from the second quarter of 2006 and first quarter of 2007. |
| • | | Total average loans decreased 2% and total average consumer and commercial deposits increased 1% from the second quarter of 2006. The decline in loans was due to approximately $10 billion of loan sales associated with specific balance sheet management strategies that began in the second quarter of 2006 and were accelerated in the first half of 2007. Average consumer and commercial deposit growth was driven mainly by NOW account and consumer and other time deposit growth. |
| • | | The tier 1 capital and tangible equity to tangible asset ratios increased as the Company took steps to improve these ratios over the past year, the most significant of which was the capital restructuring program executed in the second-half of 2006. The tier 1 capital ratio improved an estimated 19 basis points from June 30, 2006, to approximately 7.5% as of June 30, 2007, and the tangible equity to tangible asset ratio improved 4 basis points to 5.85% over the same period. The balance sheet management strategies executed in the first half of 2007 provided the Company enough flexibility to repurchase approximately $850 million, or 8.7 million shares, of common stock through an accelerated share repurchase agreement and open market purchases and still improve its capital ratios. |
| • | | Annualized net charge-offs were 0.30% of average loans for the second quarter of 2007, up from 0.10% of average loans in the second quarter of 2006 and 0.21% of average loans in the first quarter of 2007. The increase reflects the normalization of the credit cycle from the historically low net charge-offs experienced in the first half of 2006 in addition to the negative impact from deterioration in certain segments of the consumer real estate market. The increase in net charge-offs was most pronounced in the commercial, home equity, and residential mortgage categories. |
| • | | Nonperforming loans to total loans increased to 0.64% as of June 30, 2007, from 0.27% as of June 30, 2006, due mainly to an increase in residential mortgage nonperforming loans. The increase has been driven by the maturation of this portfolio and the deterioration of the credit quality in Alternative A (“Alt-A”) mortgage loans. |
CONSOLIDATED FINANCIAL PERFORMANCE
Revenue
Fully taxable-equivalent revenue was $2,374.6 million for the second quarter of 2007, up 15% from the second quarter of 2006. Excluding the gain on Coke stock, fully taxable-equivalent revenue increased 4% driven by growth in both net interest income and noninterest income. On a sequential annualized basis, excluding the gain on sale of Coke stock, fully taxable-equivalent revenue increased 14% from the first quarter of 2007.
For the six months ended June 30, 2007, fully taxable-equivalent revenue was $4,441.8 million, up 8% from the same period in 2006. Excluding the gain on Coke stock, fully taxable-equivalent revenue was up 2% from the six months ended June 30, 2006, also driven by growth in both net interest income and noninterest income.
Net Interest Income
Fully taxable-equivalent net interest income was $1,220.0 million in the second quarter of 2007, an increase of 3% from the second quarter of 2006. Net interest margin for the second quarter of 2007 was 3.10%, a 10 basis point improvement from the second quarter of 2006. On a sequential annualized basis,
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fully taxable-equivalent net interest income improved 11% from the first quarter of 2007. Net interest margin increased 8 basis points from the first quarter of 2007 marking the second consecutive 8 basis point sequential quarter improvement. The increases in both fully taxable-equivalent net interest income and net interest margin were driven mainly by the balance sheet management strategies executed in the first half of this year, which has resulted in improved yields on earning assets, as well as de-levering the balance sheet and reducing the level of higher-cost wholesale funding. Average earning asset yields increased 5 basis points compared to the first quarter of 2007, while average interest bearing liability costs remained flat.
For the six months ended June 30, 2007, fully taxable-equivalent net interest income was $2,408.2 million, up 1% from the same period in 2006 while the net interest margin remained flat at 3.06% for the six months ended June 30, 2007 and 2006. The stable fully taxable-equivalent net interest income and net interest margin over this period is mainly attributable to the balance sheet management strategies executed this year.
Noninterest Income
Total noninterest income was $1,154.6 million for the second quarter of 2007, up 32% from the second quarter of 2006 driven in large part by the $234.8 million gain on sale of Coke stock. Noninterest income excluding the Coke stock gain increased 5%. The increase was driven by growth in several areas, including retail investment services, card fees, mortgage production and servicing-related income, and other noninterest income. Growth in retail investment services income was driven by strong annuity sales. Card fee growth was due to higher interchange fees. Mortgage production fee growth was driven by record mortgage production in the second quarter of nearly $18 billion, a 20% increase over the second quarter of 2006, nearly $3 billion of portfolio loans sold in the second quarter of 2007, and the election in the second quarter to record certain newly-originated mortgage loans held-for-sale at fair value under the provisions of SFAS 159, thereby alleviating the burdens and complexities of qualifying for hedge accounting on the mortgage warehouse. This election impacts the timing of recognition of origination fees and costs, as well as servicing value. Specifically, origination fees and costs, which had been deferred and recognized as part of the gain/loss on sale of the loan, are now recognized in earnings at time of origination. The servicing value, which had been recorded at the time the loan was sold, is now included in the fair value of the loan and recognized at origination. Mortgage servicing income increased primarily due to higher servicing fee income derived from a larger serving portfolio, partially offset by lower gains from servicing asset sales. The increase in other noninterest income was due mainly to gains generated on private equity investments and structured leasing transactions, including a $23.4 million gain on one private equity investment transaction. Net of related expenses, the pre-tax impact on income from the transaction totaled $19.3 million, or $12.0 million after-tax. Negatively impacting noninterest income was a decline in trading income due to negative market value adjustments on assets and liabilities carried at fair value, as well as a decline in trust income due to the merger of Lighthouse Partners into Lighthouse Investment Partners in the first quarter of 2007 and the sale of the corporate bond trustee business in the third quarter of 2006.
On a sequential annualized basis excluding the Coke stock gain, noninterest income increased 19% from the first quarter of 2007 due to similar reasons noted previously for the growth over the second quarter of 2006. In addition, strong growth occurred in investment banking income led by an increase in securitization fees. Other items of note were an $11.6 million gain on the sale of servicing rights that accounted for the increase in mortgage servicing-related income over the first quarter of 2007, as well as the impact of the fair value adoption in the first quarter on trading income and mortgage production-related income. This explains a majority of the variance in these two categories on a sequential annualized basis as trading income was positively impacted and mortgage production-related income was negatively impacted by the fair value adoption in the first quarter.
For the six months ended June 30, 2007, noninterest income was $2,033.5 million, an increase of 18% from the same period in 2006. Excluding the gain on Coke stock, noninterest income increased 4% compared to the six months ended June 30, 2006. The factors contributing to the growth were similar to those noted for the growth over the same quarter of last year and on a sequential annualized basis.
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Noninterest Expense
Total noninterest expense in the second quarter of 2007 was $1,251.2 million, up 3% from the second quarter of 2006. The second quarter of 2007 expense level included the impact of the Company’s election to record certain newly-originated mortgage loans held-for-sale at fair value. Under this election, costs associated with the origination of mortgage loans held-for-sale are recognized as a component of compensation expense when the loan is originated. Prior to election, these costs were deferred and recognized as part of the gain/loss on sale of the loan. The impact of this election was to increase compensation expense by $12.4 million in the quarter. Also impacting the rate of expense growth was the reversal of a leverage lease-related reserve in the second quarter of 2006 that reduced noninterest expense by $10.9 million. Excluding the impact of these two items, expense growth was only 1%, demonstrating the impact the E2 initiatives had on controlling expense growth. The initiatives generated $51.8 million of cost saves in the second quarter of 2007. Initial implementation costs associated with the E2initiatives totaled $12.4 million in the second quarter of 2007 and were offset by E2-related corporate real estate gains of $13.2 million in the quarter. On a sequential annualized basis, taking into account the impact of electing to record certain newly-originated mortgage loans held-for-sale at fair value, initial implementation costs associated with the E2initiative, and E2-related corporate real estate gains, expense growth was a modest 4%.
For the six months ended June 30, 2007, noninterest expense was $2,487.2 million, an increase of 2% compared to the same period in 2006. This increase was driven by initial implementation costs associated with E2initiatives totaling $26.2 million in 2007, partially offset by corporate real estate gains of $17.4 million, as well as the $12.4 million of compensation expense associated with electing to record certain newly-originated mortgage loans held-for-sale at fair value and the benefit of the leverage lease-related reserve reversal in 2006. Taking these items into account, expense growth was only 1% compared to the six months ended June 30, 2006. The E2 initiatives have generated $80.6 million in cost savings for the six months ended June 30, 2007.
Balance Sheet
As of June 30, 2007, SunTrust had total assets of $180.3 billion. Shareholders’ equity of $17.4 billion as of June 30, 2007, represented 10% of total assets. Book value per common share was $48.33 as of June 30, 2007.
Loans
Average loans for the second quarter of 2007 were $118.2 billion, down nearly $2 billion, or 2%, from the second quarter of 2006. The decline was due to balance sheet management strategies implemented since the second quarter of 2006 and accelerated in the first half of 2007. The strategies resulted in the sale of nearly $10 billion in loans over the past year, which included the sale of approximately $5.9 billion in mortgage loans, $1.8 billion in student loans, and $1.9 billion in corporate loans. Average loans were down $3.4 billion from the first quarter of 2007 due to $4.1 billion in mortgages moved to loans held-for-sale late in the first quarter and $1.9 billion of corporate loans sold in March. Taking into account the loan sales, the Company had underlying loan growth across most categories.
Deposits
Average consumer and commercial deposits for the second quarter of 2007 were $97.9 billion, up 1% from the second quarter of 2006. The increase in deposits was driven by growth in NOW accounts and consumer and other time deposits. The growth in these categories was offset by declines in demand deposit, money market, and savings account balances. Given market conditions and the higher-rate environment, customer preference has been for higher-yielding products. This demand has driven the continuation of the deposit mix shift away from lower-rate products, such as demand deposits, toward higher-rate products, such as time deposits or other alternative investment products with higher returns. The alternative investment products include securities sold under agreement to repurchase and off-balance sheet products,
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such as STI Classic money market mutual funds. Total brokered and foreign deposits declined 12% from the second quarter of 2006, as the Company strategically reduced the size of its loan and securities portfolios thereby reducing reliance on these higher cost funding sources.
On a sequential annualized basis, average consumer and commercial deposits increased 1% from the first quarter of 2007, driven by an 8% sequential annualized increase in demand deposits. The Company continues to pursue deposit growth initiatives, as well as increasing our presence in specific markets within our footprint.
Capital
The tier 1 capital and tangible equity to tangible asset ratios increased as the Company took steps to improve these ratios over the past year, the most significant of which was the capital restructuring program executed in the second-half of 2006. The tier 1 capital ratio improved an estimated 19 basis points from June 30, 2006, to approximately 7.5% as of June 30, 2007, and the tangible equity to tangible asset ratio improved 4 basis points to 5.85% over the same period. Given the flexibility gained through the balance sheet management strategies executed in the first half of 2007, the Company repurchased 8.7 million shares of common stock for approximately $850 million through an accelerated share repurchase agreement and open-market purchases during the second quarter. Under the terms of the accelerated share repurchase agreement, which resulted in the repurchase of 8.0 million shares in the second quarter, the Company may receive up to 1.7 million additional shares at the expiration of the agreement’s term, which is now expected to occur in late August of 2007, without additional payment. The number of additional shares will be based on the weighted average share price of SunTrust common stock between now and the expiration date.
Asset Quality
Annualized net charge-offs in the second quarter of 2007 were 0.30% of average loans, up from 0.10% in the second quarter of 2006 and 0.21% in the first quarter of 2007. Net charge-offs were $88.3 million in the second quarter of 2007 compared to $29.1 million in the second quarter of 2006 and $62.9 million in the first quarter of 2007. The increase in net charge-offs over the second quarter of 2006 reflects the normalization in the credit cycle from historically low net charge-offs experienced in the first half of 2006 in addition to the negative impact from deterioration in certain segments of the consumer real estate market. The increase in net charge-offs from both the second quarter of 2006 and first quarter of 2007 was most pronounced in the commercial, home equity, and residential mortgage categories.
Nonperforming loans were $764.6 million, or 0.64% of total loans as of June 30, 2007, compared to $327.3 million, or 0.27% of total loans as of June 30, 2006, and $665.1 million, or 0.57% of total loans as of March 31, 2007. The increase in nonperforming loans compared to both periods was mainly due to an increase in residential mortgage nonperforming loans. The increase in residential mortgage nonperforming loans was driven by the maturation of this portfolio and the deterioration of credit quality in Alt-A mortgage loans, of which the majority is well-collateralized or insured.
The allowance for loan and lease losses increased $16.4 million from March 31, 2007, to $1,050.4 million as of June 30, 2007. The increase in the allowance for loan and lease losses was mainly attributable to a $1.9 billion increase in period-end loans compared to March 31, 2007, and the deterioration in certain segments of the consumer real estate market, and resulted in a $48.2 million increase in provision for loan losses compared to the first quarter of 2007. The allowance for loan and lease losses as of June 30, 2007, represented 0.88% of period-end loans consistent with March 31, 2007. The allowance for loan and lease losses as of June 30, 2007, represented 137% of period-end nonperforming loans.
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LINE OF BUSINESS FINANCIAL PERFORMANCE
The following discussion details results for SunTrust’s five business lines: Retail, Commercial, Corporate and Investment Banking, Mortgage and Wealth and Investment Management. All revenue is reported on a fully taxable-equivalent basis. For the lines of business, results include net interest income which is computed using matched-maturity funds transfer pricing. Further, provision expense is represented by net charge-offs.
SunTrust also reports results for Corporate Other and Treasury, which includes the Treasury department as well as the residual expense associated with operational and support expense allocations. This segment also includes differences created between internal management accounting practices and generally accepted accounting principles, certain matched-maturity funds transfer pricing credits and charges, differences in provision expense compared to net charge-offs, as well as equity and its related impact.
Retail
| | | | | | |
preliminary data (in millions) | | 2nd Quarter
2007 | | 2nd Quarter
2006 | | %
Change |
Net income | | $158.9 | | $184.0 | | (14) % |
| | | | |
Revenue - fully taxable-equivalent | | 848.2 | | 856.3 | | (1) |
| | | | |
Average total loans | | 31,579.1 | | 30,437.9 | | 4 |
| | | | |
Average total deposits | | 68,743.8 | | 69,539.7 | | (1) |
Three Months Ended June 30, 2007 vs. 2006
Retail’s net income for the second quarter of 2007 was $158.9 million, a decrease of $25.0 million, or 14%, compared to the second quarter of 2006. The decrease was primarily the result of lower net interest income and higher net charge-offs partially offset by higher noninterest income.
Net interest income decreased $10.0 million, or 2%, driven by the continued shift in deposit mix to higher-rate deposit products and a $795.9 million, or 1%, decline in average deposits. Specifically, increases in higher-cost time deposits and certain NOW account products were more than offset by declines in lower-cost money market and demand deposit balances, as customer preference continues to favor higher-yielding deposit products. Net interest income was also negatively impacted by a $1.2 billion, or 68%, decrease in average loans held-for-sale, as Retail has strategically decreased exposure in relatively low spread, third-party student loans. Positively impacting net interest income was a $1.1 billion, or 4%, increase in average loans driven by growth in home equity, business banking, and newly-originated student loans. These increases were partially offset by a decrease in indirect auto loans.
Provision for loan losses increased $29.7 million reflecting normalization of the credit cycle from historically low net charge-offs experienced in the first half of 2006 in addition to the negative impact from deterioration in certain segments of the consumer real estate market. The increase compared to the second quarter of 2006 was most pronounced in home equity products.
Total noninterest income increased $1.9 million, or 1%, from the second quarter of 2006. This increase was driven primarily by increases in interchange income driven by higher transaction volume and increases in service charges on deposit accounts due to higher collection rates. These increases were partially offset by a decrease in gains on sales of student loans.
Total noninterest expense increased $2.6 million, or 1%, from the second quarter of 2006. Increases in personnel expense related to investments in the branch distribution network and business banking were partially offset by a decrease in amortization of core deposit intangibles.
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Six Months Ended June 30, 2007 vs. 2006
Retail’s net income for the six months ended June 30, 2007, was $320.1 million, a decrease of $34.7 million, or 10%, compared to the same period in 2006. The decrease was primarily the result of lower net interest income and higher net charge-offs.
Net interest income decreased $9.1 million, or 1%, driven by the continued shift in deposit mix to higher-rate deposit products. Average deposits increased $630.7 million, or 1%, as increases in higher-cost time deposits and certain NOW account products were partially offset by declines in lower-cost money market and demand deposit balances, as customer preference continues to favor higher-yielding deposit products. Net interest income was also negatively impacted by a $1.0 billion, or 58%, decrease in average loans held-for-sale, as Retail has strategically decreased exposure in relatively low spread, third-party student loans. Positively impacting net interest income was a $569.9 million, or 2%, increase in average loans driven by growth in home equity and business banking loans. These increases were partially offset by a decrease in indirect auto and student loans.
Provision for loan losses increased $55.0 million reflecting normalization of the credit cycle from historically low net charge-offs experienced in the first half of 2006 in addition to the negative impact from deterioration in certain segments of the consumer real estate market. The increase compared to the first half of 2006 was most pronounced in home equity products.
Total noninterest income increased $3.4 million, or 1%. This increase was driven primarily by increases in interchange income driven by higher transaction volume and increases in service charges on deposit accounts due to higher collection rates. These increases were partially offset by a decrease in gains on sales of student loans.
Total noninterest expense decreased $4.8 million, or less than 1%. Decreases in amortization of core deposit intangibles, new loan production expense, and shared corporate expenses were partially offset by an increase in personnel expense related to investments in the branch distribution network and business banking.
Commercial
| | | | | | |
preliminary data (in millions) | | 2nd Quarter
2007 | | 2nd Quarter
2006 | | %
Change |
Net income | | $100.6 | | $107.1 | | (6) % |
| | | | |
Revenue - fully taxable-equivalent | | 303.7 | | 312.8 | | (3) |
| | | | |
Average total loans | | 33,258.5 | | 32,821.8 | | 1 |
| | | | |
Average total deposits | | 14,275.6 | | 13,641.3 | | 5 |
Three Months Ended June 30, 2007 vs. 2006
Commercial’s net income for the second quarter of 2007 was $100.6 million, a decrease of $6.5 million, or 6%. The decrease was primarily driven by lower net interest income partially offset by higher noninterest income.
Net interest income decreased $12.6 million, or 5%, as the continued shift in deposit mix to higher-rate products decreased net interest income $11.4 million. The compression in deposit spreads was primarily due to a decrease in demand deposits, as customers redeployed liquidity in the current rate environment to higher-yielding NOW account and off-balance sheet sweep products. Total average deposits increased $634.2 million, or 5%, as increases in institutional and government deposits were partially offset by decreases in lower-cost demand deposits and money market accounts. Average loans increased $436.7 million, or 1%, resulting in a $0.6 million increase in net interest income. The average loan growth was most prominent in construction and commercial lending products.
Provision for loan losses increased $1.1 million compared to the second quarter of 2006.
Total noninterest income increased $3.4 million, or 5%, driven by increases in service charges on deposit accounts and other miscellaneous income, partially offset by a decrease in business credit card income.
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Total noninterest expense decreased $2.6 million, or 2%. Decreases in various discretionary expenses, credit and collection services expenses, and shared corporate expenses were partially offset by increased Affordable Housing-related expenses.
Six Months Ended June 30, 2007 vs. 2006
Commercial’s net income for the six months ended June 30, 2007, was $198.8 million, a decrease of $11.9 million, or 6%. The decrease was primarily driven by lower net interest income partially offset by higher noninterest income and lower noninterest expense.
Net interest income decreased $20.2 million, or 4%, as the continued shift in deposit mix to higher-rate deposit products decreased net interest income $20.7 million. The compression in deposit spreads was primarily due to a decrease in demand deposits, as customers redeployed liquidity in the current rate environment to higher-yielding NOW account and off-balance sheet sweep products. Total average deposits increased $577.1 million, or 4%, as increases in institutional and government deposits were partially offset by decreases in lower-cost demand deposits and money market accounts. Average loans increased $836.6 million, or 3%, resulting in a $3.7 million increase in net interest income. The average loan growth was most prominent in construction lending products.
Provision for loan losses increased $5.2 million, or 93%, compared to the same period in 2006. The increase was most prominent in commercial loan products.
Total noninterest income increased $3.3 million, or 2%, driven by increases in service charges on deposits, other miscellaneous income, and higher Bankcard and Capital Markets referral revenue, partially offset by a decrease in business credit card income.
Total noninterest expense decreased $4.2 million, or 1%. Decreases in various discretionary expenses, credit and collection services expenses, and shared corporate expenses were partially offset by increased Affordable Housing-related expenses.
Corporate and Investment Banking
| | | | | | |
preliminary data (in millions) | | 2nd Quarter
2007 | | 2nd Quarter
2006 | | %
Change |
Net income | | $66.1 | | $62.4 | | 6 % |
| | | | |
Revenue - fully taxable-equivalent | | 252.6 | | 216.5 | | 17 |
| | | | |
Average total loans | | 15,234.7 | | 16,394.8 | | (7) |
| | | | |
Average total deposits | | 2,779.9 | | 2,999.1 | | (7) |
Three Months Ended June 30, 2007 vs. 2006
Corporate and Investment Banking’s net income for the second quarter of 2007 was $66.1 million, an increase of $3.7 million, or 6%. The increase was primarily driven by higher noninterest income, partially offset by higher noninterest expense and net charge-offs.
Net interest income decreased $3.8 million, or 7%, due to a decrease in average loans and compression of deposit spreads. Average loan balances decreased $1.2 billion, or 7%, as the impact of a $1.9 billion structured asset sale of corporate loans in the first quarter of 2007 was partially offset by growth in corporate banking loans and lease financing assets. Average deposits decreased $219.2 million, or 7%, driven by lower demand deposits. Partially offsetting the decline in net interest income due to decreased loans and deposits was an increase driven by capital markets trading assets at improved spreads.
Provision for loan losses increased to $14.6 million from a net recovery of $0.4 million. The increase was mainly in the corporate banking and leasing portfolios.
Total noninterest income increased $39.9 million, or 25%, mainly driven by private equity investment gains and syndication, primary bond, structured leasing, and securitization activities. One private equity investment transaction generated a $23.4 million gain, and net of related expenses, the pre-tax impact on income was $19.3 million. These increases were partially offset by lower fixed income trading revenue.
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Total noninterest expense increased $15.2 million, or 13%, driven by increased incentive-based compensation due to increased revenue and the reversal of the leveraged lease-related reserve in the second quarter of 2006. This increase was partially offset by lower shared corporate expenses.
Six Months Ended June 30, 2007 vs. 2006
Corporate and Investment Banking’s net income for the six months ended June 30, 2007, was $109.3 million, a decrease of $10.0 million, or 8%. The decrease was primarily due to a decrease in net interest income and higher net charge-offs, partially offset by growth in noninterest income.
Net interest income decreased $19.2 million, or 15%, as a decrease in average loans and compression of deposit spreads resulted in a $16.7 million decline in net interest income. Average loan balances decreased $445.0 million, or 3%, as the impact of a $1.9 billion structured asset sale of corporate loans in the first quarter of 2007 was partially offset by growth in corporate banking loans and lease financing assets. Average deposits decreased $547.4 million, or 16%, as a result of lower demand deposit balances and a reduction in certain bid-category products the business elected not to bid on due to their high cost in relation to alternative funding sources. This led to net interest income compression from deposits of $3.6 million. Positively impacting net interest income was an increase in capital markets trading assets at improved spreads.
Provision for loan losses increased to $16.9 million from a net recovery of $0.8 million. The increase was mainly in the corporate banking and leasing portfolios.
Total noninterest income increased $29.1 million, or 9%, mainly driven by private equity investment gains and primary bond and syndication activities. One private equity investment transaction generated a $23.4 million gain, and net of related expenses, the pre-tax impact on income was $19.3 million. These increases were partially offset by lower income from fixed income trading, equity offerings, M&A, and securitization activities.
Total noninterest expense increased $8.2 million, or 3%, driven by increased incentive-based compensation due to increased revenue and the reversal of the leveraged lease-related reserve in the second quarter of 2006. This increase was partially offset by lower shared corporate expenses.
Mortgage
| | | | | | |
preliminary data (in millions) | | 2nd Quarter
2007 | | 2nd Quarter
2006 | | %
Change |
Net income | | $42.1 | | $61.9 | | (32) % |
| | | | |
Revenue - fully taxable-equivalent | | 272.4 | | 249.7 | | 9 |
| | | | |
Average total loans | | 29,447.5 | | 32,009.1 | | (8) |
| | | | |
Average total deposits | | 2,378.6 | | 1,843.2 | | 29 |
Three Months Ended June 30, 2007 vs 2006
Mortgage’s net income for the second quarter of 2007 was $42.1 million, a decrease of $19.8 million, or 32%, compared to the second quarter of 2006. The decline was driven by narrower secondary marketing margins, losses associated with prior Alt-A product originations, lower income from sales of servicing assets, and higher volume-related expense. Positively impacting net income were higher fee income from record production, record loan sales, and a larger servicing portfolio.
Net interest income decreased $13.9 million, or 9%, driven primarily by decreases in average loans held-for-investment and compression of loan spreads which resulted in an $18.3 million decline in net interest income. Average loans, primarily residential mortgage and residential construction loans, declined $2.6 billion, or 8%, due to balance sheet management strategies initiated in the second half of 2006 and accelerated in the first half of 2007. Average loans held-for-sale increased $4.9 billion, or 65%, however, due to compressed spreads, net interest income declined $0.6 million. The increase in average loans held-for-sale was primarily due to the first quarter transfer of $4.1 billion of portfolio loans to the held for sale
10
category. Average deposits were up $0.5 billion, or 29%, due to growth in escrow balances associated with higher servicing balances and positively impacted net interest income $7.1 million.
Provision for loan losses increased $10.9 million primarily due to higher Alt-A loan charge-offs. The Company is no longer originating Alt-A products for the held for investment portfolio.
Total noninterest income increased $36.6 million, or 36%, due to higher mortgage production and servicing income. The $5.5 million increase in mortgage production income was driven by record production and delivery volumes, partially offset by narrower secondary margins and higher losses, largely attributable to prior Alt-A production. Production volume of $18.0 billion was an increase of 19% and sales volumes of $14.2 billion was an increase of 46% over the second quarter of 2006. Mortgage production income was also favorably impacted by the election in May 2007 to record certain newly-originated mortgage loans held-for-sale at fair value under the provisions of SFAS 159, which alleviated the burdens and complexities of qualifying for hedge accounting on the mortgage warehouse. This election impacts the timing of recognition of origination fees and costs, as well as servicing value. Specifically, origination fees and costs, which had been deferred and recognized as part of the gain/loss on sale of the loan, are now recognized in earnings at time of origination. The servicing value, which had been recorded at the time the loan was sold, is now included in the fair value of the loan and recognized at origination. Mortgage servicing income increased $14.0 million, or 45%, primarily due to higher servicing fee income derived from a larger serving portfolio, partially offset by lower gains from servicing asset sales. At June 30, 2007, total loans serviced were $150.5 billion, up $29.0 billion, or 24%, from June 30, 2006. Other noninterest income was up $17.1 million due to higher insurance income and hedge gains associated with loans held at fair value, which were partially offset by corresponding loan losses in production income.
Total noninterest expense was up $44.2 million, or 29%. The second quarter of 2007 expense level included the impact of the Company’s election to record certain newly-originated mortgage loans held-for-sale at fair value. Under this election, costs associated with the origination of mortgage loans held-for-sale are recognized at the point of origination. Prior to the fair value election, these costs were deferred at origination and recognized as part of the gain/loss in noninterest income at the point of sale to the investor. Also driving the higher expense level was an increase in expense associated with record production volumes and operating losses incurred in the second quarter related to application fraud. The application fraud primarily relates to customer misstatements of income and/or assets on Alt-A products originated in prior periods.
Six Months Ended June 30, 2007 vs 2006
Mortgage’s net income for the six months ended June 30, 2007, was $49.6 million, a decline of $90.0 million or 64%. The decline was the result of narrower secondary marketing margins, losses associated with prior Alt-A product originations, lower income from sales of servicing assets, and higher volume-related expense. Positively impacting net income was improved fee income from higher production volumes, higher sales volumes, and a larger servicing portfolio.
Net interest income decreased $32.0 million, or 11%, due to lower income on portfolio loans and loans held-for-sale. Net interest income on loans was reduced $17.0 million and net interest income on loans held-for-sale was reduced $19.5 million due to spread compression resulting from higher short-term interest rates. Average loans increased $0.4 billion, or 1%, and average loans held-for-sale increased $2.9 billion, or 35%. The increase in loans held-for-sale was primarily due to the first quarter 2007 transfer of $4.1 billion of portfolio loans to loans held-for-sale. Average deposits increased $0.4 billion, or 27%, due to higher escrow balances associated with higher servicing balances and positively impacted net interest income $11.9 million.
Provision for loan losses increased $18.3 million due to higher Alt-A loan charge-offs. The Company is no longer originating Alt-A products for the held for investment portfolio.
Total noninterest income declined $45.3 million, or 21%, due to lower mortgage production income, slightly offset by higher mortgage servicing income. Mortgage production income declined $71.2 million, or 59%, as the benefits from higher production and sales volumes were more than offset by lower secondary marketing margins and losses on Alt-A loans originated in prior periods. Loan production was $32.8 billion, up $6.2 billion, or 23%, and loan sales to investors were $27.3 billion, up $7.3 billion, or 36%. Servicing
11
income increased $4.7 million, or 6%, due to higher servicing fee income derived from a larger servicing portfolio and slightly lower amortization of servicing rights. This increase was substantially offset by lower gains on sales of servicing assets from the same period in 2006. Other noninterest income was up $21.3 million due to higher insurance income and favorable hedge results on fair value assets which were partially offset by corresponding loan losses in production income.
Total noninterest expense was up $50.7 million, or 17%, due partly to the Company’s election to record certain newly-originated mortgage loans held-for-sale at fair value, under which certain loan origination costs previously deferred are now recognized at time of origination. Also driving the higher expense level was higher expense associated with stronger production volumes and operating losses related to application fraud. The application fraud primarily relates to customer misstatements of income and/or assets on Alt-A products originated in prior periods.
Wealth and Investment Management
| | | | | | |
preliminary data (in millions) | | 2nd Quarter
2007 | | 2nd Quarter
2006 | | %
Change |
Net income | | $53.3 | | $57.5 | | (7) % |
| | | | |
Revenue - fully taxable-equivalent | | 336.0 | | 342.3 | | (2) |
| | | | |
Average total loans | | 8,026.1 | | 8,063.7 | | (1) |
| | | | |
Average total deposits | | 9,869.9 | | 9,158.4 | | 8 |
Three Months Ended June 30, 2007 vs. 2006
Wealth and Investment Management’s net income for the second quarter of 2007 was $53.3 million, a decrease of $4.2 million, or 7%, compared to the second quarter of 2006. The decrease was primarily driven by the impact of the merger of Lighthouse Partners into Lighthouse Investment Partners in the first quarter of 2007, the sale of the corporate bond trustee business in the third quarter of 2006, and lower net interest income, partially offset by strong growth in retail investment income and lower noninterest expense.
Net interest income decreased $4.2 million, or 5%, due primarily to a shift in deposit mix to higher-cost products as customer preference continues to favor higher-yielding deposit products. Average deposits increased $0.7 billion, or 8%, due to an increase in higher-cost NOW accounts and time deposits, partially offset by declines in lower-cost demand and money market deposits. Average loans decreased slightly as a result of lower consumer mortgages and commercial real estate balances, partially offset by growth in personal credit lines.
Provision for loan losses increased $2.2 million primarily due to higher home equity net charge-offs.
Total noninterest income decreased $2.1 million, or 1%, primarily driven by a decline in trust revenue from the Lighthouse Partners merger and the sale of the corporate bond trustee business. Retail investment income increased $13.6 million, or 24%, due to higher recurring and transactional revenue, with annuity sales exhibiting particular strength.
Total noninterest expense decreased $1.4 million, or 1%, primarily driven by decreased expenses resulting from the Lighthouse Partners merger and a reduction in shared corporate costs, partially offset by increased intangible amortization and staff expenses.
End of period assets under management were approximately $139.1 billion compared to $135.0 billion as of the same period last year. Approximately $5.4 billion of Lighthouse Partners assets were merged into Lighthouse Investment Partners and were not included in the June 30, 2007, total. Assets under management include individually managed assets, the STI Classic Funds, institutional assets managed by Trusco Capital Management, and participant-directed retirement accounts. SunTrust’s total assets under advisement were approximately $249.9 billion, which includes $139.1 billion in assets under management, $60.3 billion in non-managed trust assets, $42.5 billion in retail brokerage assets, and $7.9 billion in non-managed corporate trust assets. Approximately $21.2 billion in non-managed corporate trust assets were sold at the time of the corporate bond trustee transaction.
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Six Months Ended June 30, 2007 vs. 2006
Wealth and Investment Management’s net income for the six months ended June 30, 2007, was $120.7 million, an increase of $16.3 million, or 16%, compared to the same period in 2006. The growth was driven primarily by a gain on sale upon the merger of Lighthouse Partners into Lighthouse Investment Partners and increased retail investment income, partially offset by lower net interest income and higher noninterest expenses.
Net interest income decreased $5.1 million, or 3%, as the continued shift in deposit mix to higher-cost products compressed deposit spreads, decreasing net interest income $5.3 million. Average deposits increased $0.7 billion, or 7%, due to increases in higher-cost NOW account products and time deposit balances, partially offset by decreases in lower-cost demand and money market deposits. Average loans increased slightly with most growth coming in consumer loans, partially offset by a decline in consumer mortgages.
Provision for loan losses increased $3.1 million primarily due to higher home equity net charge-offs.
Total noninterest income increased $44.1 million, or 9%, primarily driven by a $32.3 million gain on sale upon merger of Lighthouse Partners. Additionally, retail investment income increased due to higher recurring and transactional revenue, mainly annuity sales. Trust income decreased due to the merger of Lighthouse Partners and the sale of the corporate bond trustee business.
Total noninterest expense increased $11.4 million, or 2%. Growth was primarily attributable to increases in staff and intangible amortization expenses, partially offset by a decrease in shared corporate expenses.
Corporate Other and Treasury
| | | | | | |
preliminary data (in millions) | | 2nd Quarter
2007 | | 2nd Quarter
2006 | | %
Change |
| | | | |
Net income | | $260.3 | | $71.1 | | 266 % |
| | | | |
Net income excluding gain on sale of shares of Coke | | $114.7 | | $71.1 | | 61 |
| | | | |
Average securities available for sale | | 17,524.4 | | 25,494.2 | | (31) |
Three Months Ended June 30, 2007 vs. 2006
Corporate Other and Treasury’s net income for the second quarter of 2007 was $260.3 million, an increase of $189.2 million compared to the second quarter of 2006 and was mainly driven by the $145.6 million after-tax gain on sale of Coke stock and an increase in net interest income due to balance sheet management strategies executed in the first half of this year.
The balance sheet management strategies resulted in improved yields on earning assets, as well as de-levering the balance sheet and reducing the level of higher-cost wholesale funding. This was mainly responsible for the $74.3 million increase in net interest income. Total average assets decreased $7.8 billion, or 23.0%, mainly due to a reduction in the size of the investment portfolio designed to reduce the Company’s reliance on wholesale funding sources and increase the capacity to fund future loan growth. Total average deposits decreased $3.3 billion, or 12.2%, mainly due to a decrease in brokered and foreign deposits that resulted from the wholesale funding reduction.
Provision for loan losses, which predominantly represents the difference between consolidated provision for loan losses and net charge-offs for the lines of business, decreased $6.1 million.
Total noninterest income increased $199.5 million driven by the $234.8 million pre-tax gain on sale of Coke stock, partially offset by a $21.4 million decrease in trading income due to negative market value adjustments on certain assets and liabilities carried at fair value.
Total noninterest expense decreased $21.0 million compared to the second quarter of 2006 demonstrating the impact the E2 Efficiency and Productivity Program had on controlling expense growth. This decline was mainly due to a reduction in total staff expenses in support functions, as well as reduced advertising and consulting expenses.
13
Six Months Ended June 30, 2007 vs. 2006
Corporate Other and Treasury’s net income for the six months ended June 30, 2006, was $404.1 million, an increase of $257.5 million compared to the same period in 2006 and was mainly driven by the $145.6 million after-tax gain on sale of Coke stock and an increase in net interest income due to the aforementioned balance sheet management strategies executed in the first half of this year.
Net interest income increased $104.5 million due to the balance sheet management strategies. Total average assets decreased $5.0 billion, or 14.8%, mainly due to the reduction in the size of the investment portfolio related to the strategies. Total average deposits decreased $0.7 billion, or 2.8%, mainly due to a decrease in brokered and foreign deposits also related to the strategies.
Provision for loan losses, which predominantly represents the difference between consolidated provision for loan losses and net charge-offs for the lines of business, decreased $23.2 million.
Total noninterest income increased $272.0 million driven by the $234.8 million pre-tax gain on sale of Coke stock and a $53.0 million increase in trading profits driven by net positive market value adjustments on certain assets and liabilities carried at fair value.
Total noninterest expense decreased $14.7 million, demonstrating the impact the E2 Efficiency and Productivity Program had on controlling expense growth. This decline was mainly due to a reduction in total staff expenses in support functions, as well as reduced advertising and consulting expenses.
Corresponding Financial Tables and Information
Investors are encouraged to review the foregoing summary and discussion of SunTrust’s earnings and financial condition in conjunction with the detailed financial tables and information which SunTrust has also published today and SunTrust’s forthcoming quarterly report on Form 10-Q. Detailed financial tables and other information are available on our Web site at www.suntrust.com in the Investor Relations section located under “About SunTrust”. This information is also included in a current report on Form 8-K filed with the SEC today.
This news release contains certain non-US GAAP financial measures to describe the Company’s performance. The reconciliation of those measures to the most directly comparable US GAAP financial measures, and the reasons why SunTrust believes such financial measures may be useful to investors, can be found in the financial information contained in the appendices of this news release.
Conference Call
SunTrust management will host a conference call on July 19, 2007, at 8:00 a.m. (Eastern Time) to discuss the earnings results and business trends. Individuals are encouraged to call in beginning at 7:45 a.m. (Eastern Time) by dialing 1-888-972-7805 (Passcode: 2Q07; Leader: Greg Ketron). Individuals calling from outside the United States should dial 1-517-308-9091 (Passcode: 2Q07; Leader: Greg Ketron). A replay of the call will be available beginning July 19, 2007, and ending August 2, 2007, by dialing 1-866-418-1754 (domestic) or 1-203-369-0746 (international).
Alternatively, individuals may listen to the live webcast of the presentation by visiting the SunTrust Web site at www.suntrust.com. The webcast will be hosted under “Investor Relations” located under “About SunTrust” or may be accessed directly from the SunTrust home page by clicking on the earnings-related link, “2nd Quarter Earnings Release.” Beginning the afternoon of July 19, 2007, listeners may access an archived version of the webcast in the “Webcasts and Presentations” subsection found under “Investor Relations.” This webcast will be archived and available for one year. A link to the Investor Relations page is also found in the footer of the SunTrust home page.
SunTrust Banks, Inc., headquartered in Atlanta, is one of the nation’s largest banking organizations, serving a broad range of consumer, commercial, corporate and institutional clients. The Company operates an extensive branch and ATM network throughout the high-growth Southeast and Mid-Atlantic states and a full array of technology-based, 24-hour delivery channels. The Company also serves customers in selected markets nationally. Its primary businesses include deposit, credit, trust and investment services. Through
14
various subsidiaries the Company provides credit cards, mortgage banking, insurance, brokerage, equipment leasing and capital markets services. SunTrust’s Internet address is www.suntrust.com.
Forward-Looking Statements
This news release may contain forward-looking statements. Statements that do not describe historical or current facts, including statements about beliefs and expectations, are forward-looking statements. These statements often include the words “may,” “could,” “will,” “should,” “believes,” “expects,” “anticipates,” “estimates,” “intends,” “plans,” “initiatives,” “targets,” “potentially,” “probably,” “projects,” “outlook” or similar expressions. Such statements are based upon the current beliefs and expectations of SunTrust’s management, and on information currently available to management, and speak as of the date hereof. Forward-looking statements are subject to significant risks and uncertainties. Investors are cautioned against placing undue reliance on such statements. Actual results may differ materially from those set forth in the forward-looking statements. Factors that could cause SunTrust’s results to differ materially from those described in the forward-looking statements can be found in the Company’s 2006 Annual Report on Form 10-K, in the Quarterly Reports on Form 10-Q and in the Current Reports filed on Form 8-K with the Securities and Exchange Commission and available at the Securities and Exchange Commission’s internet site (http://www.sec.gov). Those factors include: changes in general business or economic conditions or the competitive banking environment; changes in market interest rates or capital markets; significant changes in legislation or regulatory requirements, or the fiscal and monetary policies of the federal government and its agencies; significant changes in securities markets or markets for residential or commercial real estate; increases in the cost of funds resulting from customers pursuing alternatives to bank deposits or shifting from demand deposits to higher-cost products; hurricanes and other natural disasters; competitive pressures among local, regional, national, and international banks, thrifts credit unions, and other financial institutions; litigation; the potential that the Company may acquire other institutions or may divest certain portions of its business; changes in accounting principles, policies, or guidelines; and we carry certain financial instruments at fair value and are subject to market risk.
The forward-looking statements in this news release speak only as of this date, and SunTrust does not assume any obligation to update such statements or to update the reasons why actual results could differ from those contained in such statements.
###
15
SunTrust Banks, Inc. and Subsidiaries
FINANCIAL HIGHLIGHTS
(Dollars in millions, except per share data) (Unaudited)
| | | | | | | | | | | | | | | | | | |
| | | Three Months Ended
June 30
| | | % | | | Six Months Ended
June 30
| | | % | |
| | | 2007
| | | 2006
| | | Change
| | | 2007
| | | 2006
| | | Change
| |
EARNINGS & DIVIDENDS | | | | | | | | | | | | | | | | | | |
Net income | | $681.4 | | | $544.0 | | | 25.3 | % | | $1,202.7 | | | $1,075.5 | | | 11.8 | % |
Net income available to common shareholders | | 673.9 | | | 544.0 | | | 23.9 | | | 1,187.8 | | | 1,075.5 | | | 10.4 | |
Net income available to common shareholders excluding gain on sale of shares of The Coca-Cola Company 1 | | 528.3 | | | 544.0 | | | (2.9 | ) | | 1,042.3 | | | 1,075.5 | | | (3.1 | ) |
Total revenue - FTE 2 | | 2,374.6 | | | 2,065.4 | | | 15.0 | | | 4,441.8 | | | 4,116.3 | | | 7.9 | |
Total revenue - FTE excluding net securities gains and losses 1 | | 2,138.2 | | | 2,059.5 | | | 3.8 | | | 4,205.3 | | | 4,110.3 | | | 2.3 | |
Total revenue - FTE excluding gain on sale of shares of The Coca-Cola Company 1 | | 2,139.8 | | | 2,065.4 | | | 3.6 | | | 4,206.9 | | | 4,116.3 | | | 2.2 | |
Net income per average common share | | | | | | | | | | | | | | | | | | |
Diluted | | 1.89 | | | 1.49 | | | 26.8 | | | 3.33 | | | 2.96 | | | 12.5 | |
Diluted excluding gain on sale of shares of The Coca-Cola Company 1 | | 1.48 | | | 1.49 | | | (0.7 | ) | | 2.92 | | | 2.96 | | | (1.4 | ) |
Basic | | 1.91 | | | 1.51 | | | 26.5 | | | 3.37 | | | 2.98 | | | 13.1 | |
Dividends paid per average common share | | 0.73 | | | 0.61 | | | 19.4 | | | 1.46 | | | 1.22 | | | 19.6 | |
| | | | | | |
CONDENSED BALANCE SHEETS | | | | | | | | | | | | | | | | | | |
Selected Average Balances | | | | | | | | | | | | | | | | | | |
Total assets | | $179,996 | | | $180,744 | | | (0.4 | )% | | $180,747 | | | $179,190 | | | 0.9 | % |
Earning assets | | 157,594 | | | 158,889 | | | (0.8 | ) | | 158,529 | | | 157,325 | | | 0.8 | |
Loans | | 118,165 | | | 120,145 | | | (1.6 | ) | | 119,831 | | | 118,214 | | | 1.4 | |
Consumer and commercial deposits | | 97,927 | | | 97,172 | | | 0.8 | | | 97,860 | | | 96,238 | | | 1.7 | |
Brokered and foreign deposits | | 23,983 | | | 27,194 | | | (11.8 | ) | | 25,341 | | | 25,930 | | | (2.3 | ) |
Total shareholders’ equity | | 17,928 | | | 17,304 | | | 3.6 | | | 17,825 | | | 17,179 | | | 3.8 | |
| | | | | | |
As of | | | | | | | | | | | | | | | | | | |
Total assets | | 180,314 | | | 181,143 | | | (0.5 | ) | | | | | | | | | |
Earning assets | | 157,095 | | | 158,845 | | | (1.1 | ) | | | | | | | | | |
Loans | | 118,788 | | | 120,243 | | | (1.2 | ) | | | | | | | | | |
Allowance for loan and lease losses | | 1,050 | | | 1,062 | | | (1.1 | ) | | | | | | | | | |
Consumer and commercial deposits | | 97,822 | | | 99,042 | | | (1.2 | ) | | | | | | | | | |
Brokered and foreign deposits | | 25,069 | | | 25,811 | | | (2.9 | ) | | | | | | | | | |
Total shareholders’ equity | | 17,369 | | | 17,424 | | | (0.3 | ) | | | | | | | | | |
| | | | | | |
FINANCIAL RATIOS & OTHER DATA | | | | | | | | | | | | | | | | | | |
Return on average total assets | | 1.52 | % | | 1.21 | % | | 25.6 | % | | 1.34 | % | | 1.21 | % | | 10.7 | % |
Return on average assets less net unrealized securities gains1 | | 1.18 | | | 1.18 | | | - | | | 1.16 | | | 1.19 | | | (2.5 | ) |
Return on average common shareholders’ equity | | 15.51 | | | 12.61 | | | 23.0 | | | 13.83 | | | 12.63 | | | 9.5 | |
Return on average realized common shareholders’ equity 1 | | 12.71 | | | 12.90 | | | (1.5 | ) | | 12.63 | | | 12.98 | | | (2.7 | ) |
Net interest margin2 | | 3.10 | | | 3.00 | | | 3.3 | | | 3.06 | | | 3.06 | | | - | |
Efficiency ratio2 | | 52.69 | | | 58.78 | | | (10.4 | ) | | 56.00 | | | 59.29 | | | (5.6 | ) |
Tangible efficiency ratio1 | | 51.64 | | | 57.53 | | | (10.2 | ) | | 54.91 | | | 58.00 | | | (5.3 | ) |
Effective tax rate | | 31.45 | | | 30.10 | | | 4.5 | | | 31.08 | | | 30.56 | | | 1.7 | |
Tier 1 capital ratio | | 7.5 | 3 | | 7.31 | | | 2.7 | | | | | | | | | | |
Total capital ratio | | 10.8 | 3 | | 10.70 | | | 0.7 | | | | | | | | | | |
Tier 1 leverage ratio | | 7.1 | 3 | | 6.82 | | | 4.1 | | | | | | | | | | |
Total average shareholders’ equity to total average assets | | 9.96 | | | 9.57 | | | 4.0 | | | 9.86 | | | 9.59 | | | 2.9 | |
Tangible equity to tangible assets1 | | 5.85 | | | 5.81 | | | 0.7 | | | | | | | | | | |
| | | | | | |
Full-time equivalent employees | | 33,241 | | | 34,155 | | | (2.7 | ) | | | | | | | | | |
Number of ATMs | | 2,533 | | | 2,564 | | | (1.2 | ) | | | | | | | | | |
Full service banking offices | | 1,685 | | | 1,695 | | | (0.6 | ) | | | | | | | | | |
Traditional | | 1,338 | | | 1,342 | | | (0.3 | ) | | | | | | | | | |
In-store | | 347 | | | 353 | | | (1.7 | ) | | | | | | | | | |
| | | | | | |
Book value per common share | | $48.33 | | | $47.85 | | | 1.0 | | | | | | | | | | |
Market price: | | | | | | | | | | | | | | | | | | |
High | | 94.18 | | | 78.33 | | | 20.2 | | | 94.18 | | | 78.33 | | | 20.2 | |
Low | | 78.16 | | | 72.56 | | | 7.7 | | | 78.16 | | | 69.68 | | | 12.2 | |
Close | | 85.74 | | | 76.26 | | | 12.4 | | | 85.74 | | | 76.26 | | | 12.4 | |
Market capitalization | | 29,928 | | | 27,768 | | | 7.8 | | | | | | | | | | |
| | | | | | |
Average common shares outstanding (000s) | | | | | | | | | | | | | | | | | | |
Diluted | | 356,008 | | | 364,391 | | | (2.3 | ) | | 356,608 | | | 363,917 | | | (2.0 | ) |
Basic | | 351,987 | | | 361,267 | | | (2.6 | ) | | 352,713 | | | 360,604 | | | (2.2 | ) |
| | | | | | | | | | | | | | | | | | | |
1 | See Appendix A for a reconcilement of non-GAAP performance measures. |
2 | Revenue, net interest margin, and efficiency ratios are presented on a fully taxable-equivalent (“FTE”) basis. The FTE basis adjusts for the tax-favored status of net interest income from certain loans and investments. The Company believes this measure to be the preferred industry measurement of net interest income and it enhances comparability of net interest income arising from taxable and tax-exempt sources. Total Revenue - FTE equals net interest income on a FTE basis plus noninterest income. |
3 | Current period tier 1 capital, total capital and tier 1 leverage ratios are estimated as of the earnings release date. |
Page 1
SunTrust Banks, Inc. and Subsidiaries
FIVE QUARTER FINANCIAL HIGHLIGHTS
(Dollars in millions, except per share data) (Unaudited)
| | | | | | | | | | | | | | | |
| | | Three Months Ended
| |
| | | June 30
2007
| | | March 31
2007
| | | December 31
2006
| | | September 30
2006
| | | June 30
2006
| |
EARNINGS & DIVIDENDS | | | | | | | | | | | | | | | |
Net income | | $681.4 | | | $521.3 | | | $506.3 | | | $535.6 | | | $544.0 | |
Net income available to common shareholders | | 673.9 | | | 513.9 | | | 498.6 | | | 535.6 | | | 544.0 | |
Net income available to common shareholders excluding gain on sale of shares of The Coca-Cola Company1 | | 528.3 | | | 513.9 | | | 498.6 | | | 535.6 | | | 544.0 | |
Total revenue - FTE2 | | 2,374.6 | | | 2,067.2 | | | 2,067.7 | | | 2,032.8 | | | 2,065.4 | |
Total revenue - FTE excluding net securities gains and losses and net gain on sale of Bond Trustee business1 | | 2,138.2 | | | 2,067.2 | | | 2,032.4 | | | 2,011.8 | | | 2,059.5 | |
Total revenue - FTE excluding gain on sale of shares of The Coca-Cola Company1 | | 2,139.8 | | | 2,067.2 | | | 2,067.7 | | | 2,032.8 | | | 2,065.4 | |
Net income per average common share | | | | | | | | | | | | | | | |
Diluted | | 1.89 | | | 1.44 | | | 1.39 | | | 1.47 | | | 1.49 | |
Diluted, excluding gain on sale of shares of The Coca-Cola Company 1 | | 1.48 | | | 1.44 | | | 1.39 | | | 1.47 | | | 1.49 | |
Basic | | 1.91 | | | 1.45 | | | 1.41 | | | 1.48 | | | 1.51 | |
Dividends paid per average common share | | 0.73 | | | 0.73 | | | 0.61 | | | 0.61 | | | 0.61 | |
| | | | | |
CONDENSED BALANCE SHEETS | | | | | | | | | | | | | | | |
Selected Average Balances | | | | | | | | | | | | | | | |
Total assets | | $179,996 | | | $181,506 | | | $182,343 | | | $180,501 | | | $180,744 | |
Earning assets | | 157,594 | | | 159,474 | | | 160,115 | | | 158,915 | | | 158,889 | |
Loans | | 118,165 | | | 121,515 | | | 121,364 | | | 120,742 | | | 120,145 | |
Consumer and commercial deposits | | 97,927 | | | 97,792 | | | 98,553 | | | 97,643 | | | 97,172 | |
Brokered and foreign deposits | | 23,983 | | | 26,714 | | | 26,124 | | | 27,958 | | | 27,194 | |
Total shareholders’ equity | | 17,928 | | | 17,720 | | | 18,155 | | | 17,662 | | | 17,304 | |
| | | | | |
As of | | | | | | | | | | | | | | | |
Total assets | | 180,314 | | | 186,385 | | | 182,162 | | | 183,105 | | | 181,143 | |
Earning assets | | 157,095 | | | 163,299 | | | 159,064 | | | 160,288 | | | 158,845 | |
Loans | | 118,788 | | | 116,913 | | | 121,454 | | | 121,237 | | | 120,243 | |
Allowance for loan and lease losses | | 1,050 | | | 1,034 | | | 1,045 | | | 1,087 | | | 1,062 | |
Consumer and commercial deposits | | 97,822 | | | 99,875 | | | 99,776 | | | 98,684 | | | 99,042 | |
Brokered and foreign deposits | | 25,069 | | | 23,563 | | | 24,246 | | | 25,709 | | | 25,811 | |
Total shareholders’ equity | | 17,369 | | | 17,969 | | | 17,814 | | | 18,589 | | | 17,424 | |
| | | | | |
FINANCIAL RATIOS & OTHER DATA | | | | | | | | | | | | | | | |
Return on average total assets | | 1.52 | % | | 1.16 | % | | 1.10 | % | | 1.18 | % | | 1.21 | % |
Return on average assets less net unrealized securities gains1 | | 1.18 | | | 1.15 | | | 1.04 | | | 1.28 | | | 1.18 | |
Return on average common shareholders’ equity | | 15.51 | | | 12.10 | | | 11.20 | | | 12.10 | | | 12.61 | |
Return on average realized common shareholders’ equity1 | | 12.71 | | | 12.54 | | | 11.17 | | | 13.73 | | | 12.90 | |
Net interest margin2 | | 3.10 | | | 3.02 | | | 2.94 | | | 2.93 | | | 3.00 | |
Efficiency ratio2 | | 52.69 | | | 59.79 | | | 59.67 | | | 59.30 | | | 58.78 | |
Tangible efficiency ratio1 | | 51.64 | | | 58.65 | | | 58.49 | | | 58.03 | | | 57.53 | |
Effective tax rate | | 31.45 | | | 30.59 | | | 27.07 | | | 27.94 | | | 30.10 | |
Tier 1 capital ratio | | 7.5 | 3 | | 7.60 | | | 7.72 | | | 7.70 | | | 7.31 | |
Total capital ratio | | 10.8 | 3 | | 10.94 | | | 11.11 | | | 11.07 | | | 10.70 | |
Tier 1 leverage ratio | | 7.1 | 3 | | 7.24 | | | 7.23 | | | 7.27 | | | 6.82 | |
Total average shareholders’ equity to total average assets | | 9.96 | | | 9.76 | | | 9.96 | | | 9.78 | | | 9.57 | |
Tangible equity to tangible assets1 | | 5.85 | | | 5.97 | | | 6.03 | | | 6.42 | | | 5.81 | |
| | | | | |
Full-time equivalent employees | | 33,241 | | | 33,397 | | | 33,599 | | | 34,293 | | | 34,155 | |
Number of ATMs | | 2,533 | | | 2,543 | | | 2,569 | | | 2,568 | | | 2,564 | |
Full service banking offices | | 1,685 | | | 1,691 | | | 1,701 | | | 1,699 | | | 1,695 | |
Traditional | | 1,338 | | | 1,338 | | | 1,349 | | | 1,347 | | | 1,342 | |
In-store | | 347 | | | 353 | | | 352 | | | 352 | | | 353 | |
Book value per common share | | $48.33 | | | $49.00 | | | $48.78 | | | $49.71 | | | $47.85 | |
Market price: | | | | | | | | | | | | | | | |
High | | 94.18 | | | 87.43 | | | 85.64 | | | 81.59 | | | 78.33 | |
Low | | 78.16 | | | 80.76 | | | 76.76 | | | 75.11 | | | 72.56 | |
Close | | 85.74 | | | 83.04 | | | 84.45 | | | 77.28 | | | 76.26 | |
Market capitalization | | 29,928 | | | 29,604 | | | 29,972 | | | 28,120 | | | 27,768 | |
Average common shares outstanding (000s) | | | | | | | | | | | | | | | |
Diluted | | 356,008 | | | 357,214 | | | 358,292 | | | 365,121 | | | 364,391 | |
Basic | | 351,987 | | | 353,448 | | | 354,677 | | | 361,805 | | | 361,267 | |
| | | | | | | | | | | | | | | | |
1 | See Appendix A for a reconcilement of non-GAAP performance measures. |
2 | Revenue, net interest margin, and efficiency ratios are presented on a fully taxable-equivalent (“FTE”) basis. The FTE basis adjusts for the tax-favored status of net interest income from certain loans and investments. The Company believes this measure to be the preferred industry measurement of net interest income and it enhances comparability of net interest income arising from taxable and tax-exempt sources. Total Revenue - FTE equals net interest income on a FTE basis plus noninterest income. |
3 | Current period tier 1 capital, total capital and tier 1 leverage ratios are estimated as of the earnings release date. |
Page 2
SunTrust Banks, Inc. and Subsidiaries
CONSOLIDATED BALANCE SHEETS
(Dollars in thousands) (Unaudited)
| | | | | | | | | | | | |
| | | As of June 30
| | | Increase/(Decrease)3
| |
| | | 2007
| | | 2006
| | | Amount
| | | %
| |
ASSETS | | | | | | | | | | | | |
Cash and due from banks | | $4,254,430 | | | $4,214,076 | | | $40,354 | | | 1.0 | % |
Interest-bearing deposits in other banks | | 25,991 | | | 29,733 | | | (3,742 | ) | | (12.6 | ) |
Funds sold and securities purchased under agreements to resell | | 1,143,995 | | | 942,983 | | | 201,012 | | | 21.3 | |
Trading assets | | 13,044,972 | | | 2,621,940 | | | 10,423,032 | | | NM | |
Securities available for sale1 | | 14,725,957 | | | 26,542,900 | | | (11,816,943 | ) | | (44.5 | ) |
Loans held for sale (loans at fair value: $6,494,602 as of June 30, 2007) | | 12,474,932 | | | 10,819,967 | | | 1,654,965 | | | 15.3 | |
Loans: | | | | | | | | | | | | |
Commercial | | 34,362,837 | | | 35,159,832 | | | (796,995 | ) | | (2.3 | ) |
Real estate: | | | | | | | | | | | | |
Home equity lines | | 14,303,659 | | | 13,894,177 | | | 409,482 | | | 2.9 | |
Construction | | 14,417,949 | | | 13,099,808 | | | 1,318,141 | | | 10.1 | |
Residential mortgages | | 30,759,216 | | | 32,844,670 | | | (2,085,454 | ) | | (6.3 | ) |
Commercial real estate | | 12,416,329 | | | 12,575,092 | | | (158,763 | ) | | (1.3 | ) |
Consumer: | | | | | | | | | | | | |
Direct | | 4,391,739 | | | 4,237,332 | | | 154,407 | | | 3.6 | |
Indirect | | 7,739,369 | | | 8,113,741 | | | (374,372 | ) | | (4.6 | ) |
Credit card | | 396,624 | | | 318,493 | | | 78,131 | | | 24.5 | |
| | |
|
| |
|
| |
|
| | | |
Total loans | | 118,787,722 | | | 120,243,145 | | | (1,455,423 | ) | | (1.2 | ) |
Allowance for loan and lease losses | | (1,050,362 | ) | | (1,061,862 | ) | | (11,500 | ) | | (1.1 | ) |
| | |
|
| |
|
| |
|
| | | |
Net loans | | 117,737,360 | | | 119,181,283 | | | (1,443,923 | ) | | (1.2 | ) |
Goodwill | | 6,897,050 | | | 6,900,222 | | | (3,172 | ) | | - | |
Other intangible assets | | 1,290,460 | | | 1,141,346 | | | 149,114 | | | 13.1 | |
Other assets | | 8,719,225 | | | 8,748,994 | | | (29,769 | ) | | (0.3 | ) |
| | |
|
| |
|
| |
|
| | | |
Total assets2 | | $180,314,372 | | | $181,143,444 | | | ($829,072 | ) | | (0.5 | ) |
| | |
|
| |
|
| |
|
| | | |
| | | | |
LIABILITIES | | | | | | | | | | | | |
Noninterest-bearing consumer and commercial deposits | | $22,725,654 | | | $24,243,088 | | | ($1,517,434 | ) | | (6.3 | )% |
Interest-bearing consumer and commercial deposits: | | | | | | | | | | | | |
NOW accounts | | 20,255,930 | | | 17,194,199 | | | 3,061,731 | | | 17.8 | |
Money market accounts | | 21,645,616 | | | 24,627,018 | | | (2,981,402 | ) | | (12.1 | ) |
Savings | | 4,698,516 | | | 5,556,847 | | | (858,331 | ) | | (15.4 | ) |
Consumer time | | 16,745,010 | | | 16,134,694 | | | 610,316 | | | 3.8 | |
Other time | | 11,751,246 | | | 11,285,875 | | | 465,371 | | | 4.1 | |
| | |
|
| |
|
| |
|
| | | |
Total consumer and commercial deposits | | 97,821,972 | | | 99,041,721 | | | (1,219,749 | ) | | (1.2 | ) |
Brokered deposits (CDs at fair value: $282,889 as of June 30, 2007; $62,419 as of June 30, 2006) | | 16,659,978 | | | 18,425,635 | | | (1,765,657 | ) | | (9.6 | ) |
Foreign deposits | | 8,408,752 | | | 7,385,081 | | | 1,023,671 | | | 13.9 | |
| | |
|
| |
|
| |
|
| | | |
Total deposits | | 122,890,702 | | | 124,852,437 | | | (1,961,735 | ) | | (1.6 | ) |
Funds purchased | | 3,405,459 | | | 4,527,339 | | | (1,121,880 | ) | | (24.8 | ) |
Securities sold under agreements to repurchase | | 6,081,096 | | | 7,158,914 | | | (1,077,818 | ) | | (15.1 | ) |
Other short-term borrowings | | 2,083,518 | | | 1,438,891 | | | 644,627 | | | 44.8 | |
Long-term debt (notes at fair value: $6,757,188 as of June 30, 2007) | | 20,604,933 | | | 18,222,162 | | | 2,382,771 | | | 13.1 | |
Trading liabilities | | 2,156,279 | | | 1,574,107 | | | 582,172 | | | 37.0 | |
Other liabilities | | 5,723,532 | | | 5,945,674 | | | (222,142 | ) | | (3.7 | ) |
| | |
|
| |
|
| |
|
| | | |
Total liabilities | | 162,945,519 | | | 163,719,524 | | | (774,005 | ) | | (0.5 | ) |
| | |
|
| |
|
| |
|
| | | |
| | | | |
SHAREHOLDERS’ EQUITY | | | | | | | | | | | | |
Preferred stock, no par value | | 500,000 | | | - | | | 500,000 | | | 100.0 | |
Common stock, $1.00 par value | | 370,578 | | | 370,578 | | | - | | | - | |
Additional paid in capital | | 6,589,387 | | | 6,751,929 | | | (162,542 | ) | | (2.4 | ) |
Retained earnings | | 10,739,449 | | | 9,943,155 | | | 796,294 | | | 8.0 | |
Treasury stock, at cost, and other | | (1,751,449 | ) | | (418,262 | ) | | (1,333,187 | ) | | NM | |
Accumulated other comprehensive income | | 920,888 | | | 776,520 | | | 144,368 | | | 18.6 | |
| | |
|
| |
|
| |
|
| | | |
Total shareholders’ equity | | 17,368,853 | | | 17,423,920 | | | (55,067 | ) | | (0.3 | ) |
| | |
|
| |
|
| |
|
| | | |
Total liabilities and shareholders’ equity | | $180,314,372 | | | $181,143,444 | | | ($829,072 | ) | | (0.5 | ) |
| | |
|
| |
|
| |
|
| | | |
Common shares outstanding | | 349,052,800 | | | 364,129,209 | | | (15,076,409 | ) | | (4.1 | ) |
Common shares authorized | | 750,000,000 | | | 750,000,000 | | | - | | | - | |
Preferred shares outstanding | | 5,000 | | | - | | | 5,000 | | | 100.0 | |
Preferred shares authorized | | 50,000,000 | | | 50,000,000 | | | - | | | - | |
Treasury shares of common stock | | 21,525,598 | | | 6,449,189 | | | 15,076,409 | | | NM | |
| | | | | | | | | | | | | |
| |
1 Includes net unrealized gains of | | $2,035,623 | | | $1,309,753 | | | $725,870 | | | 55.4 | % |
2 Includes earning assets of | | 157,094,873 | | | 158,845,216 | | | (1,750,343 | ) | | (1.1 | ) |
3 | “NM” - Not meaningful. Those changes over 100 percent were not considered to be meaningful. |
Page 3
SunTrust Banks, Inc. and Subsidiaries
FIVE QUARTER CONSOLIDATED BALANCE SHEETS
(Dollars in thousands) (Unaudited)
| | | | | | | | | | | | | | | |
| | | As of
| |
| | | June 30 2007
| | | March 31 2007
| | | December 31
2006
| | | September 30
2006
| | | June 30 2006
| |
ASSETS | | | | | | | | | | | | | | | |
Cash and due from banks | | $4,254,430 | | | $3,867,957 | | | $4,235,889 | | | $4,066,173 | | | $4,214,076 | |
Interest-bearing deposits in other banks | | 25,991 | | | 21,974 | | | 21,810 | | | 39,982 | | | 29,733 | |
Funds sold and securities purchased under agreements to resell | | 1,143,995 | | | 883,833 | | | 1,050,046 | | | 1,147,423 | | | 942,983 | |
Trading assets | | 13,044,972 | | | 21,545,502 | | | 2,777,629 | | | 3,675,917 | | | 2,621,940 | |
Securities available for sale1 | | 14,725,957 | | | 13,163,036 | | | 25,101,715 | | | 25,553,320 | | | 26,542,900 | |
Loans held for sale | | 12,474,932 | | | 14,067,788 | | | 11,790,122 | | | 11,501,646 | | | 10,819,967 | |
Loans: | | | | | | | | | | | | | | | |
Commercial | | 34,362,837 | | | 33,484,170 | | | 34,613,882 | | | 35,018,715 | | | 35,159,832 | |
Real estate: | | | | | | | | | | | | | | | |
Home equity lines | | 14,303,659 | | | 14,039,685 | | | 14,102,655 | | | 14,014,617 | | | 13,894,177 | |
Construction | | 14,417,949 | | | 14,175,478 | | | 13,892,988 | | | 13,595,924 | | | 13,099,808 | |
Residential mortgages | | 30,759,216 | | | 30,248,543 | | | 33,830,101 | | | 33,711,399 | | | 32,844,670 | |
Commercial real estate | | 12,416,329 | | | 12,454,475 | | | 12,567,824 | | | 12,459,023 | | | 12,575,092 | |
Consumer: | | | | | | | | | | | | | | | |
Direct | | 4,391,739 | | | 4,293,308 | | | 4,160,091 | | | 4,082,257 | | | 4,237,332 | |
Indirect | | 7,739,369 | | | 7,840,962 | | | 7,936,102 | | | 8,022,512 | | | 8,113,741 | |
Credit card | | 396,624 | | | 375,938 | | | 350,690 | | | 332,947 | | | 318,493 | |
| | |
|
| |
|
| |
|
| |
|
| |
|
|
Total loans | | 118,787,722 | | | 116,912,559 | | | 121,454,333 | | | 121,237,394 | | | 120,243,145 | |
Allowance for loan and lease losses | | (1,050,362 | ) | | (1,033,939 | ) | | (1,044,521 | ) | | (1,087,316 | ) | | (1,061,862 | ) |
| | |
|
| |
|
| |
|
| |
|
| |
|
|
Net loans | | 117,737,360 | | | 115,878,620 | | | 120,409,812 | | | 120,150,078 | | | 119,181,283 | |
Goodwill | | 6,897,050 | | | 6,896,723 | | | 6,889,860 | | | 6,903,001 | | | 6,900,222 | |
Other intangible assets | | 1,290,460 | | | 1,293,457 | | | 1,181,984 | | | 1,120,102 | | | 1,141,346 | |
Other assets | | 8,719,225 | | | 8,765,951 | | | 8,702,742 | | | 8,946,911 | | | 8,748,994 | |
| | |
|
| |
|
| |
|
| |
|
| |
|
|
Total assets2 | | $180,314,372 | | | $186,384,841 | | | $182,161,609 | | | $183,104,553 | | | $181,143,444 | |
| | |
|
| |
|
| |
|
| |
|
| |
|
|
LIABILITIES | | | | | | | | | | | | | | | |
Noninterest-bearing consumer and commercial deposits | | $22,725,654 | | | $22,765,045 | | | $22,887,176 | | | $22,813,455 | | | $24,243,088 | |
Interest-bearing consumer and commercial deposits: | | | | | | | | | | | | | | | |
NOW accounts | | 20,255,930 | | | 20,802,207 | | | 20,230,763 | | | 17,508,754 | | | 17,194,199 | |
Money market accounts | | 21,645,616 | | | 22,070,587 | | | 22,371,828 | | | 23,803,496 | | | 24,627,018 | |
Savings | | 4,698,516 | | | 5,102,312 | | | 5,198,980 | | | 5,699,545 | | | 5,556,847 | |
Consumer time | | 16,745,010 | | | 17,044,783 | | | 16,824,239 | | | 16,615,445 | | | 16,134,694 | |
Other time | | 11,751,246 | | | 12,089,882 | | | 12,262,902 | | | 12,243,372 | | | 11,285,875 | |
| | |
|
| |
|
| |
|
| |
|
| |
|
|
Total consumer and commercial deposits | | 97,821,972 | | | 99,874,816 | | | 99,775,888 | | | 98,684,067 | | | 99,041,721 | |
Brokered deposits | | 16,659,978 | | | 18,203,295 | | | 18,150,059 | | | 18,264,554 | | | 18,425,635 | |
Foreign deposits | | 8,408,752 | | | 5,360,164 | | | 6,095,682 | | | 7,444,329 | | | 7,385,081 | |
| | |
|
| |
|
| |
|
| |
|
| |
|
|
Total deposits | | 122,890,702 | | | 123,438,275 | | | 124,021,629 | | | 124,392,950 | | | 124,852,437 | |
Funds purchased | | 3,405,459 | | | 6,433,195 | | | 4,867,591 | | | 5,926,570 | | | 4,527,339 | |
Securities sold under agreements to repurchase | | 6,081,096 | | | 6,851,863 | | | 6,950,426 | | | 7,362,480 | | | 7,158,914 | |
Other short-term borrowings | | 2,083,518 | | | 1,958,438 | | | 2,062,636 | | | 1,744,479 | | | 1,438,891 | |
Long-term debt | | 20,604,933 | | | 19,007,959 | | | 18,992,905 | | | 17,477,276 | | | 18,222,162 | |
Trading liabilities | | 2,156,279 | | | 1,642,958 | | | 1,634,097 | | | 1,611,648 | | | 1,574,107 | |
Other liabilities | | 5,723,532 | | | 9,083,615 | | | 5,818,719 | | | 5,999,843 | | | 5,945,674 | |
| | |
|
| |
|
| |
|
| |
|
| |
|
|
Total liabilities | | 162,945,519 | | | 168,416,303 | | | 164,348,003 | | | 164,515,246 | | | 163,719,524 | |
| | |
|
| |
|
| |
|
| |
|
| |
|
|
SHAREHOLDERS’ EQUITY | | | | | | | | | | | | | | | |
Preferred stock, no par value | | 500,000 | | | 500,000 | | | 500,000 | | | 500,000 | | | - | |
Common stock, $1.00 par value | | 370,578 | | | 370,578 | | | 370,578 | | | 370,578 | | | 370,578 | |
Additional paid in capital | | 6,589,387 | | | 6,688,660 | | | 6,627,196 | | | 6,735,458 | | | 6,751,929 | |
Retained earnings | | 10,739,449 | | | 10,325,246 | | | 10,541,152 | | | 10,258,441 | | | 9,943,155 | |
Treasury stock, at cost, and other | | (1,751,449 | ) | | (1,101,172 | ) | | (1,151,269 | ) | | (453,934 | ) | | (418,262 | ) |
Accumulated other comprehensive income | | 920,888 | | | 1,185,226 | | | 925,949 | | | 1,178,764 | | | 776,520 | |
| | |
|
| |
|
| |
|
| |
|
| |
|
|
Total shareholders’ equity | | 17,368,853 | | | 17,968,538 | | | 17,813,606 | | | 18,589,307 | | | 17,423,920 | |
| | |
|
| |
|
| |
|
| |
|
| |
|
|
Total liabilities and shareholders’ equity | | $180,314,372 | | | $186,384,841 | | | $182,161,609 | | | $183,104,553 | | | $181,143,444 | |
| | |
|
| |
|
| |
|
| |
|
| |
|
|
Common shares outstanding | | 349,052,800 | | | 356,504,563 | | | 354,902,566 | | | 363,868,470 | | | 364,129,209 | |
Common shares authorized | | 750,000,000 | | | 750,000,000 | | | 750,000,000 | | | 750,000,000 | | | 750,000,000 | |
Preferred shares outstanding | | 5,000 | | | 5,000 | | | 5,000 | | | 5,000 | | | - | |
Preferred shares authorized | | 50,000,000 | | | 50,000,000 | | | 50,000,000 | | | 50,000,000 | | | 50,000,000 | |
Treasury shares of common stock | | 21,525,598 | | | 14,073,835 | | | 15,675,832 | | | 6,709,928 | | | 6,449,189 | |
| | | | | | | | | | | | | | | | |
| |
1 Includes net unrealized gains of | | $2,035,623 | | | $2,333,896 | | | $2,103,362 | | | $1,915,277 | | | $1,309,753 | |
2 Includes earning assets of | | 157,094,873 | | | 163,299,162 | | | 159,063,834 | | | 160,287,584 | | | 158,845,216 | |
Page 4
SunTrust Banks, Inc. and Subsidiaries
CONSOLIDATED STATEMENTS OF INCOME
(Dollars in thousands, except per share data) (Unaudited)
| | | | | | | | | | | | | | | | | | | | |
| | | Three Months Ended
| | | Six Months Ended
| |
| | | June 30
| | Increase/(Decrease) 2
| | | June 30
| | Increase/(Decrease) 2
| |
| | | 2007
| | 2006
| | Amount
| | | %
| | | 2007
| | 2006
| | Amount
| | | %
| |
Interest income | | $2,543,870 | | $2,423,087 | | $120,783 | | | 5.0 | % | | $5,071,927 | | $4,701,800 | | $370,127 | | | 7.9 | % |
Interest expense | | 1,348,586 | | 1,254,344 | | 94,242 | | | 7.5 | | | 2,712,084 | | 2,354,016 | | 358,068 | | | 15.2 | |
| | |
| |
| |
|
| | | | |
| |
| |
|
| | | |
NET INTEREST INCOME | | 1,195,284 | | 1,168,743 | | 26,541 | | | 2.3 | | | 2,359,843 | | 2,347,784 | | 12,059 | | | 0.5 | |
Provision for loan losses | | 104,680 | | 51,759 | | 52,921 | | | NM | | | 161,121 | | 85,162 | | 75,959 | | | 89.2 | |
| | |
| |
| |
|
| | | | |
| |
| |
|
| | | |
NET INTEREST INCOME AFTER | | | | | | | | | | | | | | | | | | | | |
PROVISION FOR LOAN LOSSES | | 1,090,604 | | 1,116,984 | | (26,380 | ) | | (2.4 | ) | | 2,198,722 | | 2,262,622 | | (63,900 | ) | | (2.8 | ) |
| | |
| |
| |
|
| | | | |
| |
| |
|
| | | |
| | | | | | | | |
NONINTEREST INCOME | | | | | | | | | | | | | | | | | | | | |
Service charges on deposit accounts | | 196,844 | | 191,645 | | 5,199 | | | 2.7 | | | 385,879 | | 377,830 | | 8,049 | | | 2.1 | |
Trust and investment management income | | 164,620 | | 175,811 | | (11,191 | ) | | (6.4 | ) | | 338,938 | | 343,900 | | (4,962 | ) | | (1.4 | ) |
Retail investment services | | 71,785 | | 58,441 | | 13,344 | | | 22.8 | | | 135,328 | | 113,430 | | 21,898 | | | 19.3 | |
Other charges and fees | | 118,358 | | 113,948 | | 4,410 | | | 3.9 | | | 236,495 | | 226,330 | | 10,165 | | | 4.5 | |
Investment banking income | | 61,999 | | 60,481 | | 1,518 | | | 2.5 | | | 112,156 | | 112,296 | | (140 | ) | | (0.1 | ) |
Trading account profits and commissions | | 16,437 | | 46,182 | | (29,745 | ) | | (64.4 | ) | | 106,638 | | 83,057 | | 23,581 | | | 28.4 | |
Card fees | | 68,580 | | 61,941 | | 6,639 | | | 10.7 | | | 132,775 | | 118,544 | | 14,231 | | | 12.0 | |
Mortgage production related income | | 64,322 | | 56,579 | | 7,743 | | | 13.7 | | | 55,667 | | 119,616 | | (63,949 | ) | | (53.5 | ) |
Mortgage servicing related income | | 45,527 | | 31,401 | | 14,126 | | | 45.0 | | | 80,930 | | 76,111 | | 4,819 | | | 6.3 | |
Other noninterest income | | 109,738 | | 73,082 | | 36,656 | | | 50.2 | | | 212,290 | | 149,799 | | 62,491 | | | 41.7 | |
Securities gains/(losses), net | | 236,412 | | 5,858 | | 230,554 | | | NM | | | 236,432 | | 5,962 | | 230,470 | | | NM | |
| | |
| |
| |
|
| | | | |
| |
| |
|
| | | |
Total noninterest income | | 1,154,622 | | 875,369 | | 279,253 | | | 31.9 | | | 2,033,528 | | 1,726,875 | | 306,653 | | | 17.8 | |
| | |
| |
| |
|
| | | | |
| |
| |
|
| | | |
| | | | | | | | |
NONINTEREST EXPENSE | | | | | | | | | | | | | | | | | | | | |
Employee compensation and benefits | | 710,613 | | 689,073 | | 21,540 | | | 3.1 | | | 1,409,613 | | 1,394,038 | | 15,575 | | | 1.1 | |
Net occupancy expense | | 84,650 | | 81,710 | | 2,940 | | | 3.6 | | | 170,907 | | 162,754 | | 8,153 | | | 5.0 | |
Outside processing and software | | 100,730 | | 98,447 | | 2,283 | | | 2.3 | | | 200,406 | | 193,339 | | 7,067 | | | 3.7 | |
Equipment expense | | 53,823 | | 48,107 | | 5,716 | | | 11.9 | | | 103,232 | | 97,555 | | 5,677 | | | 5.8 | |
Marketing and customer development | | 43,326 | | 49,378 | | (6,052 | ) | | (12.3 | ) | | 89,031 | | 92,024 | | (2,993 | ) | | (3.3 | ) |
Amortization of intangible assets | | 24,904 | | 25,885 | | (981 | ) | | (3.8 | ) | | 48,446 | | 53,130 | | (4,684 | ) | | (8.8 | ) |
Other noninterest expense | | 233,148 | | 221,493 | | 11,655 | | | 5.3 | | | 465,556 | | 447,744 | | 17,812 | | | 4.0 | |
| | |
| |
| |
|
| | | | |
| |
| |
|
| | | |
Total noninterest expense | | 1,251,194 | | 1,214,093 | | 37,101 | | | 3.1 | | | 2,487,191 | | 2,440,584 | | 46,607 | | | 1.9 | |
| | |
| |
| |
|
| | | | |
| |
| |
|
| | | |
| | | | | | | | |
INCOME BEFORE PROVISION FOR INCOME TAXES | | 994,032 | | 778,260 | | 215,772 | | | 27.7 | | | 1,745,059 | | 1,548,913 | | 196,146 | | | 12.7 | |
Provision for income taxes | | 312,601 | | 234,258 | | 78,343 | | | 33.4 | | | 542,332 | | 473,384 | | 68,948 | | | 14.6 | |
| | |
| |
| |
|
| | | | |
| |
| |
|
| | | |
Net income | | 681,431 | | 544,002 | | 137,429 | | | 25.3 | | | 1,202,727 | | 1,075,529 | | 127,198 | | | 11.8 | |
Preferred dividends | | 7,519 | | - | | 7,519 | | | 100.0 | | | 14,882 | | - | | 14,882 | | | 100.0 | |
| | |
| |
| |
|
| | | | |
| |
| |
|
| | | |
| | | | | | | | |
NET INCOME AVAILABLE TO COMMON SHAREHOLDERS | | $673,912 | | $544,002 | | $129,910 | | | 23.9 | | | $1,187,845 | | $1,075,529 | | $112,316 | | | 10.4 | |
| | |
| |
| |
|
| | | | |
| |
| |
|
| | | |
Net interest income - FTE1 | | $1,219,952 | | $1,190,026 | | $29,926 | | | 2.5 | | | $2,408,224 | | $2,389,405 | | $18,819 | | | 0.8 | |
| | | | | | | | |
Net income per average common share | | | | | | | | | | | | | | | | | | | | |
Diluted | | 1.89 | | 1.49 | | 0.40 | | | 26.8 | | | 3.33 | | 2.96 | | 0.37 | | | 12.5 | |
Basic | | 1.91 | | 1.51 | | 0.40 | | | 26.5 | | | 3.37 | | 2.98 | | 0.39 | | | 13.1 | |
| | | | | | | | |
Cash dividends paid per common share | | 0.73 | | 0.61 | | 0.12 | | | 19.4 | | | 1.46 | | 1.22 | | 0.24 | | | 19.6 | |
Average common shares outstanding (000s) | | | | | | | | | | | | | | | | | | | | |
Diluted | | 356,008 | | 364,391 | | (8,383 | ) | | (2.3 | ) | | 356,608 | | 363,917 | | (7,309 | ) | | (2.0 | ) |
Basic | | 351,987 | | 361,267 | | (9,280 | ) | | (2.6 | ) | | 352,713 | | 360,604 | | (7,891 | ) | | (2.2 | ) |
| | | | | | | | | | | | | | | | | | | | | |
1 | Net interest income includes the effects of FTE adjustments using a federal tax rate of 35% and state income taxes where applicable to increase tax-exempt interest income to a taxable-equivalent basis. |
2 | “NM” - Not meaningful. Those changes over 100 percent were not considered to be meaningful. |
Page 5
SunTrust Banks, Inc. and Subsidiaries
FIVE QUARTER CONSOLIDATED STATEMENTS OF INCOME
(Dollars in thousands, except per share data) (Unaudited)
| | | | | | | | | | | | |
| | | Three Months Ended
|
| | | June 30 2007
| | March 31
2007
| | | December 31
2006
| | September 30
2006
| | | June 30 2006
|
Interest income | | $2,543,870 | | $2,528,057 | | | $2,564,731 | | $2,525,489 | | | $2,423,087 |
Interest expense | | 1,348,586 | | 1,363,498 | | | 1,403,442 | | 1,374,097 | | | 1,254,344 |
| | |
| |
|
| |
| |
|
| |
|
NET INTEREST INCOME | | 1,195,284 | | 1,164,559 | | | 1,161,289 | | 1,151,392 | | | 1,168,743 |
Provision for loan losses | | 104,680 | | 56,441 | | | 115,806 | | 61,568 | | | 51,759 |
| | |
| |
|
| |
| |
|
| |
|
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES | | 1,090,604 | | 1,108,118 | | | 1,045,483 | | 1,089,824 | | | 1,116,984 |
| | |
| |
|
| |
| |
|
| |
|
| | | | | |
NONINTEREST INCOME | | | | | | | | | | | | |
Service charges on deposit accounts | | 196,844 | | 189,035 | | | 191,628 | | 194,262 | | | 191,645 |
Trust and investment management income | | 164,620 | | 174,318 | | | 169,248 | | 173,717 | | | 175,811 |
Retail investment services | | 71,785 | | 63,543 | | | 65,000 | | 55,544 | | | 58,441 |
Other charges and fees | | 118,358 | | 118,137 | | | 122,386 | | 113,347 | | | 113,948 |
Investment banking income | | 61,999 | | 50,157 | | | 71,211 | | 47,046 | | | 60,481 |
Trading account profits and commissions | | 16,437 | | 90,201 | | | 9,586 | | 20,404 | | | 46,182 |
Card fees | | 68,580 | | 64,195 | | | 64,187 | | 64,916 | | | 61,941 |
Mortgage production related income | | 64,322 | | (8,655 | ) | | 47,476 | | 50,336 | | | 56,579 |
Mortgage servicing related income | | 45,527 | | 35,403 | | | 8,994 | | 36,633 | | | 31,401 |
Net gain on sale of Bond Trustee business | | - | | - | | | - | | 112,759 | | | - |
Gain on sale upon merger of Lighthouse Partners | | - | | 32,340 | | | - | | - | | | - |
Other noninterest income | | 109,738 | | 70,212 | | | 97,473 | | 81,783 | | | 73,082 |
Securities gains/(losses), net | | 236,412 | | 20 | | | 35,377 | | (91,816 | ) | | 5,858 |
| | |
| |
|
| |
| |
|
| |
|
Total noninterest income | | 1,154,622 | | 878,906 | | | 882,566 | | 858,931 | | | 875,369 |
| | |
| |
|
| |
| |
|
| |
|
| | | | | |
NONINTEREST EXPENSE | | | | | | | | | | | | |
Employee compensation and benefits | | 710,613 | | 699,000 | | | 657,093 | | 674,322 | | | 689,073 |
Net occupancy expense | | 84,650 | | 86,257 | | | 85,846 | | 85,613 | | | 81,710 |
Outside processing and software | | 100,730 | | 99,676 | | | 101,538 | | 98,699 | | | 98,447 |
Equipment expense | | 53,823 | | 49,409 | | | 49,234 | | 50,249 | | | 48,107 |
Marketing and customer development | | 43,326 | | 45,705 | | | 45,249 | | 35,932 | | | 49,378 |
Amortization of intangible assets | | 24,904 | | 23,542 | | | 24,304 | | 25,792 | | | 25,885 |
Loss on extinguishment of debt | | - | | - | | | 11,665 | | - | | | - |
Other noninterest expense | | 233,148 | | 232,408 | | | 258,848 | | 234,892 | | | 221,493 |
| | |
| |
|
| |
| |
|
| |
|
Total noninterest expense | | 1,251,194 | | 1,235,997 | | | 1,233,777 | | 1,205,499 | | | 1,214,093 |
| | |
| |
|
| |
| |
|
| |
|
| | | | | |
INCOME BEFORE PROVISION FOR INCOME TAXES | | 994,032 | | 751,027 | | | 694,272 | | 743,256 | | | 778,260 |
Provision for income taxes | | 312,601 | | 229,731 | | | 187,918 | | 207,668 | | | 234,258 |
| | |
| |
|
| |
| |
|
| |
|
Net income | | 681,431 | | 521,296 | | | 506,354 | | 535,588 | | | 544,002 |
Preferred dividends | | 7,519 | | 7,363 | | | 7,729 | | - | | | - |
| | |
| |
|
| |
| |
|
| |
|
NET INCOME AVAILABLE TO COMMON SHAREHOLDERS | | $673,912 | | $513,933 | | | $498,625 | | $535,588 | | | $544,002 |
| | |
| |
|
| |
| |
|
| |
|
Net interest income - FTE1 | | $1,219,952 | | $1,188,272 | | | $1,185,166 | | $1,173,860 | | | $1,190,026 |
Net income per average common share | | | | | | | | | | | | |
Diluted | | 1.89 | | 1.44 | | | 1.39 | | 1.47 | | | 1.49 |
Basic | | 1.91 | | 1.45 | | | 1.41 | | 1.48 | | | 1.51 |
| | | | | |
Cash dividends paid per common share | | 0.73 | | 0.73 | | | 0.61 | | 0.61 | | | 0.61 |
Average common shares outstanding (000s) | | | | | | | | | | | | |
Diluted | | 356,008 | | 357,214 | | | 358,292 | | 365,121 | | | 364,391 |
Basic | | 351,987 | | 353,448 | | | 354,677 | | 361,805 | | | 361,267 |
| | | | | | | | | | | | | |
1 | Net interest income includes the effects of FTE adjustments using a federal tax rate of 35% and state income taxes where applicable to increase tax-exempt interest income to a taxable-equivalent basis. |
Page 6
SunTrust Banks, Inc. and Subsidiaries
CONSOLIDATED DAILY AVERAGE BALANCES,
AVERAGE YIELDS EARNED AND RATES PAID
(Dollars in millions; yields on taxable-equivalent basis) (Unaudited)
| | | | | | | | | | | | | | | | |
| | | Three Months Ended
| |
| | | June 30, 2007
| | | March 31, 2007
| |
| | | Average
Balances
| | | Interest
Income/
Expense
| | Yields/
Rates
| | | Average
Balances
| | | Interest
Income/
Expense
| | Yields/
Rates
| |
ASSETS | | | | | | | | | | | | | | | | |
Loans: | | | | | | | | | | | | | | | | |
Real estate 1-4 family | | $30,754.4 | | | $493.2 | | 6.42 | % | | $34,089.1 | | | $527.3 | | 6.19 | % |
Real estate construction | | 13,710.1 | | | 259.4 | | 7.59 | | | 13,430.3 | | | 252.7 | | 7.63 | |
Real estate home equity lines | | 13,849.7 | | | 272.4 | | 7.89 | | | 13,738.1 | | | 268.3 | | 7.92 | |
Real estate commercial | | 12,731.8 | | | 220.8 | | 6.95 | | | 12,830.6 | | | 220.2 | | 6.96 | |
Commercial - FTE1 | | 33,607.7 | | | 539.6 | | 6.44 | | | 34,032.8 | | | 535.6 | | 6.38 | |
Business credit card | | 403.7 | | | 5.9 | | 5.80 | | | 369.5 | | | 5.5 | | 5.94 | |
Consumer - direct | | 4,347.5 | | | 78.2 | | 7.21 | | | 4,220.5 | | | 76.0 | | 7.30 | |
Consumer - indirect | | 8,063.6 | | | 123.1 | | 6.12 | | | 8,166.5 | | | 122.0 | | 6.06 | |
Nonaccrual and restructured | | 696.1 | | | 4.8 | | 2.76 | | | 637.5 | | | 4.5 | | 2.85 | |
| | |
|
| |
| |
|
| |
|
| |
| |
|
|
Total loans | | 118,164.6 | | | 1,997.4 | | 6.78 | | | 121,514.9 | | | 2,012.1 | | 6.72 | |
Securities available for sale: | | | | | | | | | | | | | | | | |
Taxable | | 11,014.3 | | | 167.7 | | 6.09 | | | 6,650.6 | | | 108.7 | | 6.54 | |
Tax-exempt - FTE1 | | 1,041.2 | | | 15.2 | | 5.85 | | | 1,038.8 | | | 15.2 | | 5.86 | |
| | |
|
| |
| |
|
| |
|
| |
| |
|
|
Total securities available for sale - FTE1 | | 12,055.5 | | | 182.9 | | 6.07 | | | 7,689.4 | | | 123.9 | | 6.44 | |
Funds sold and securities purchased under agreements to resell | | 1,038.1 | | | 13.2 | | 5.04 | | | 1,006.3 | | | 12.9 | | 5.12 | |
Loans held for sale | | 13,454.3 | | | 200.4 | | 5.96 | | | 11,205.2 | | | 173.7 | | 6.20 | |
Interest-bearing deposits | | 24.1 | | | 0.3 | | 5.74 | | | 28.9 | | | 0.4 | | 5.69 | |
Interest earning trading assets | | 12,857.6 | | | 174.3 | | 5.44 | | | 18,028.9 | | | 228.8 | | 5.15 | |
| | |
|
| |
| |
|
| |
|
| |
| |
|
|
Total earning assets | | 157,594.2 | | | 2,568.5 | | 6.54 | | | 159,473.6 | | | 2,551.8 | | 6.49 | |
Allowance for loan and lease losses | | (1,037.6 | ) | | | | | | | (1,050.5 | ) | | | | | |
Cash and due from banks | | 3,427.7 | | | | | | | | 3,520.0 | | | | | | |
Premises and equipment | | 1,980.1 | | | | | | | | 2,001.0 | | | | | | |
Other assets | | 14,646.8 | | | | | | | | 14,271.9 | | | | | | |
Noninterest earning trading assets | | 986.6 | | | | | | | | 985.1 | | | | | | |
Unrealized gains on securities available for sale, net | | 2,398.7 | | | | | | | | 2,305.3 | | | | | | |
| | |
|
| | | | | | |
|
| | | | | |
Total assets | | $179,996.5 | | | | | | | | $181,506.4 | | | | | | |
| | |
|
| | | | | | |
|
| | | | | |
| | | | | | |
LIABILITIES AND SHAREHOLDERS’ EQUITY | | | | | | | | | | | | | | | | |
Interest-bearing deposits: | | | | | | | | | | | | | | | | |
NOW accounts | | $20,065.8 | | | $119.0 | | 2.38 | % | | $19,820.1 | | | $115.9 | | 2.37 | % |
Money market accounts | | 21,773.3 | | | 142.0 | | 2.62 | | | 22,089.1 | | | 142.9 | | 2.62 | |
Savings | | 4,786.7 | | | 14.8 | | 1.24 | | | 5,024.8 | | | 16.3 | | 1.32 | |
Consumer time | | 16,942.3 | | | 190.5 | | 4.51 | | | 16,809.4 | | | 183.1 | | 4.42 | |
Other time | | 11,962.4 | | | 144.5 | | 4.85 | | | 12,115.8 | | | 144.0 | | 4.82 | |
| | |
|
| |
| |
|
| |
|
| |
| |
|
|
Total interest-bearing consumer and commercial deposits | | 75,530.5 | | | 610.8 | | 3.24 | | | 75,859.2 | | | 602.2 | | 3.22 | |
Brokered deposits | | 16,972.2 | | | 227.5 | | 5.30 | | | 18,888.5 | | | 250.8 | | 5.31 | |
Foreign deposits | | 7,011.2 | | | 92.9 | | 5.24 | | | 7,825.6 | | | 102.9 | | 5.26 | |
| | |
|
| |
| |
|
| |
|
| |
| |
|
|
Total interest-bearing deposits | | 99,513.9 | | | 931.2 | | 3.75 | | | 102,573.3 | | | 955.9 | | 3.78 | |
Funds purchased | | 3,967.7 | | | 52.2 | | 5.21 | | | 4,693.1 | | | 61.2 | | 5.22 | |
Securities sold under agreements to repurchase | | 6,339.0 | | | 74.4 | | 4.64 | | | 6,768.0 | | | 79.5 | | 4.70 | |
Other short-term borrowings | | 2,262.3 | | | 32.7 | | 5.79 | | | 1,758.4 | | | 26.0 | | 6.00 | |
Long-term debt | | 19,772.4 | | | 258.0 | | 5.24 | | | 19,000.8 | | | 240.9 | | 5.14 | |
| | |
|
| |
| |
|
| |
|
| |
| |
|
|
Total interest-bearing liabilities | | 131,855.3 | | | 1,348.5 | | 4.10 | | | 134,793.6 | | | 1,363.5 | | 4.10 | |
Noninterest-bearing deposits | | 22,395.8 | | | | | | | | 21,933.1 | | | | | | |
Other liabilities | | 7,817.3 | | | | | | | | 7,059.3 | | | | | | |
Shareholders’ equity | | 17,928.1 | | | | | | | | 17,720.4 | | | | | | |
| | |
|
| | | | | | |
|
| | | | | |
Total liabilities and shareholders’ equity | | $179,996.5 | | | | | | | | $181,506.4 | | | | | | |
| | |
|
| | | | | | |
|
| | | | | |
| | | | | | | |
|
| | | | | | |
|
|
Interest Rate Spread | | | | | | | 2.44 | % | | | | | | | 2.39 | % |
| | | | | | | |
|
| | | | | | |
|
|
| | | | | |
| | | | | | | |
| | | |
Net Interest Income - FTE1 | | | | | $1,220.0 | | | | | | | | $1,188.3 | | | |
| | | | | |
| | | | | | | |
| | | |
| | | | | | | |
|
| | | | | | | | |
Net Interest Margin2 | | | | | | | 3.10 | % | | | | | | | 3.02 | % |
| | | | | | | |
|
| | | | | | |
|
|
1 | The fully taxable-equivalent (“FTE”) basis adjusts for the tax-favored status of net interest income from certain loans and investments. The Company believes this measure to be the preferred industry measurement of net interest income and it enhances comparability of net interest income arising from taxable and tax-exempt sources. |
2 | The net interest margin is calculated by dividing annualized net interest income - FTE by average total earning assets. |
Page 7
SunTrust Banks, Inc. and Subsidiaries
CONSOLIDATED DAILY AVERAGE BALANCES,
AVERAGE YIELDS EARNED AND RATES PAID
(Dollars in millions; yields on taxable-equivalent basis) (Unaudited)
| | | | | | | | | | | | | | | | | | | | | | | | |
| | | Three Months Ended
| |
| | | December 31, 2006
| | | September 30, 2006
| | | June 30, 2006
| |
| | | Average
Balances
| | | Interest
Income/
Expense
| | Yields/
Rates
| | | Average
Balances
| | | Interest
Income/
Expense
| | Yields/
Rates
| | | Average
Balances
| | | Interest
Income/
Expense
| | Yields/
Rates
| |
ASSETS | | | | | | | | | | | | | | | | | | | | | | | | |
Loans: | | | | | | | | | | | | | | | | | | | | | | | | |
Real estate 1-4 family | | $34,345.4 | | | $531.8 | | 6.19 | % | | $33,875.7 | | | $519.4 | | 6.13 | % | | $34,348.0 | | | $515.1 | | 6.00 | % |
Real estate construction | | 13,204.0 | | | 254.3 | | 7.64 | | | 12,805.6 | | | 247.5 | | 7.67 | | | 12,180.6 | | | 226.4 | | 7.45 | |
Real estate home equity lines | | 13,722.9 | | | 273.4 | | 7.90 | | | 13,626.3 | | | 270.2 | | 7.87 | | | 13,517.5 | | | 253.6 | | 7.52 | |
Real estate commercial | | 12,784.8 | | | 223.1 | | 6.93 | | | 12,808.6 | | | 223.4 | | 6.92 | | | 12,840.8 | | | 215.5 | | 6.73 | |
Commercial - FTE1 | | 33,965.1 | | | 545.8 | | 6.37 | | | 34,306.9 | | | 542.1 | | 6.27 | | | 33,993.0 | | | 516.7 | | 6.10 | |
Business credit card | | 351.4 | | | 5.3 | | 5.99 | | | 323.8 | | | 5.0 | | 6.14 | | | 307.0 | | | 4.6 | | 5.96 | |
Consumer - direct | | 4,116.3 | | | 76.8 | | 7.40 | | | 4,206.9 | | | 76.7 | | 7.23 | | | 4,251.1 | | | 75.9 | | 7.16 | |
Consumer - indirect | | 8,231.8 | | | 123.8 | | 5.97 | | | 8,339.1 | | | 121.5 | | 5.78 | | | 8,385.8 | | | 117.0 | | 5.60 | |
Nonaccrual and restructured | | 642.1 | | | 5.0 | | 3.06 | | | 449.1 | | | 4.4 | | 3.87 | | | 320.7 | | | 3.1 | | 3.88 | |
| | |
|
| |
| |
|
| |
|
| |
| |
|
| |
|
| |
| |
|
|
Total loans | | 121,363.8 | | | 2,039.3 | | 6.67 | | | 120,742.0 | | | 2,010.2 | | 6.61 | | | 120,144.5 | | | 1,927.9 | | 6.44 | |
Securities available for sale: | | | | | | | | | | | | | | | | | | | | | | | | |
Taxable | | 22,170.4 | | | 282.0 | | 5.09 | | | 23,027.9 | | | 286.9 | | 4.98 | | | 24,621.2 | | | 294.8 | | 4.79 | |
Tax-exempt - FTE1 | | 998.0 | | | 14.6 | | 5.85 | | | 968.7 | | | 14.1 | | 5.84 | | | 933.6 | | | 13.7 | | 5.85 | |
| | |
|
| |
| |
|
| |
|
| |
| |
|
| |
|
| |
| |
|
|
Total securities available for sale - FTE1 | | 23,168.4 | | | 296.6 | | 5.12 | | | 23,996.6 | | | 301.0 | | 5.02 | | | 25,554.8 | | | 308.5 | | 4.83 | |
Funds sold and securities purchased under agreements to resell | | 1,176.3 | | | 15.4 | | 5.15 | | | 1,084.1 | | | 14.3 | | 5.16 | | | 1,244.1 | | | 15.2 | | 4.83 | |
Loans held for sale | | 12,009.3 | | | 198.4 | | 6.61 | | | 11,026.4 | | | 188.0 | | 6.82 | | | 9,929.3 | | | 163.7 | | 6.59 | |
Interest-bearing deposits | | 31.2 | | | 0.3 | | 3.76 | | | 25.8 | | | 0.3 | | 5.04 | | | 27.0 | | | 0.3 | | 4.73 | |
Interest earning trading assets | | 2,365.8 | | | 38.6 | | 6.46 | | | 2,039.8 | | | 34.2 | | 6.64 | | | 1,989.1 | | | 28.7 | | 5.78 | |
| | |
|
| |
| |
|
| |
|
| |
| |
|
| |
|
| |
| |
|
|
Total earning assets | | 160,114.8 | | | 2,588.6 | | 6.41 | | | 158,914.7 | | | 2,548.0 | | 6.36 | | | 158,888.8 | | | 2,444.3 | | 6.17 | |
Allowance for loan and lease losses | | (1,086.1 | ) | | | | | | | (1,070.8 | ) | | | | | | | (1,050.1 | ) | | | | | |
Cash and due from banks | | 3,683.1 | | | | | | | | 3,705.8 | | | | | | | | 3,899.6 | | | | | | |
Premises and equipment | | 1,957.4 | | | | | | | | 1,925.7 | | | | | | | | 1,908.0 | | | | | | |
Other assets | | 14,708.2 | | | | | | | | 14,702.1 | | | | | | | | 14,660.1 | | | | | | |
Noninterest earning trading assets | | 1,000.5 | | | | | | | | 948.8 | | | | | | | | 909.7 | | | | | | |
Unrealized gains on securities available for sale, net | | 1,965.4 | | | | | | | | 1,374.6 | | | | | | | | 1,528.0 | | | | | | |
| | |
|
| | | | | | |
|
| | | | | | |
|
| | | | | |
Total assets | | $182,343.3 | | | | | | | | $180,500.9 | | | | | | | | $180,744.1 | | | | | | |
| | |
|
| | | | | | |
|
| | | | | | |
|
| | | | | |
| | | | | | | | | |
LIABILITIES AND SHAREHOLDERS’ EQUITY | | | | | | | | | | | | | | | | | | | | | | | | |
Interest-bearing deposits: | | | | | | | | | | | | | | | | | | | | | | | | |
NOW accounts | | $18,441.1 | | | $102.2 | | 2.20 | % | | $16,596.2 | | | $78.1 | | 1.87 | % | | $16,811.2 | | | $67.0 | | 1.60 | % |
Money market accounts | | 23,075.7 | | | 153.1 | | 2.63 | | | 24,267.0 | | | 171.4 | | 2.80 | | | 25,091.3 | | | 163.4 | | 2.61 | |
Savings | | 5,437.0 | | | 23.6 | | 1.73 | | | 5,591.2 | | | 24.1 | | 1.71 | | | 5,161.0 | | | 16.2 | | 1.26 | |
Consumer time | | 16,682.8 | | | 180.8 | | 4.30 | | | 16,402.5 | | | 169.8 | | 4.11 | | | 15,471.7 | | | 146.7 | | 3.80 | |
Other time | | 12,338.6 | | | 148.3 | | 4.77 | | | 11,852.2 | | | 138.1 | | 4.62 | | | 10,779.1 | | | 114.8 | | 4.27 | |
| | |
|
| |
| |
|
| |
|
| |
| |
|
| |
|
| |
| |
|
|
Total interest-bearing consumer and commercial deposits | | 75,975.2 | | | 608.0 | | 3.18 | | | 74,709.1 | | | 581.5 | | 3.09 | | | 73,314.3 | | | 508.1 | | 2.78 | |
Brokered deposits | | 18,102.0 | | | 243.1 | | 5.25 | | | 18,420.7 | | | 246.1 | | 5.23 | | | 17,692.0 | | | 218.6 | | 4.89 | |
Foreign deposits | | 8,022.2 | | | 107.6 | | 5.25 | | | 9,537.6 | | | 128.5 | | 5.27 | | | 9,502.3 | | | 117.5 | | 4.89 | |
| | |
|
| |
| |
|
| |
|
| |
| |
|
| |
|
| |
| |
|
|
Total interest-bearing deposits | | 102,099.4 | | | 958.7 | | 3.73 | | | 102,667.4 | | | 956.1 | | 3.69 | | | 100,508.6 | | | 844.2 | | 3.37 | |
Funds purchased | | 5,163.4 | | | 68.8 | | 5.21 | | | 4,206.7 | | | 56.2 | | 5.23 | | | 4,402.3 | | | 54.2 | | 4.87 | |
Securities sold under agreements to repurchase | | 7,148.8 | | | 86.3 | | 4.72 | | | 7,146.3 | | | 86.0 | | 4.71 | | | 7,184.1 | | | 79.4 | | 4.37 | |
Other short-term borrowings | | 1,913.3 | | | 29.7 | | 6.17 | | | 1,001.3 | | | 16.9 | | 6.70 | | | 1,252.4 | | | 18.0 | | 5.78 | |
Long-term debt | | 17,854.2 | | | 259.9 | | 5.78 | | | 17,735.2 | | | 258.9 | | 5.79 | | | 18,438.0 | | | 258.5 | | 5.62 | |
| | |
|
| |
| |
|
| |
|
| |
| |
|
| |
|
| |
| |
|
|
Total interest-bearing liabilities | | 134,179.1 | | | 1,403.4 | | 4.15 | | | 132,756.9 | | | 1,374.1 | | 4.11 | | | 131,785.4 | | | 1,254.3 | | 3.82 | |
Noninterest-bearing deposits | | 22,577.7 | | | | | | | | 22,933.4 | | | | | | | | 23,858.0 | | | | | | |
Other liabilities | | 7,431.0 | | | | | | | | 7,148.8 | | | | | | | | 7,796.3 | | | | | | |
Shareholders’ equity | | 18,155.5 | | | | | | | | 17,661.8 | | | | | | | | 17,304.4 | | | | | | |
| | |
|
| | | | | | |
|
| | | | | | |
|
| | | | | |
Total liabilities and shareholders’ equity | | $182,343.3 | | | | | | | | $180,500.9 | | | | | | | | $180,744.1 | | | | | | |
| | |
|
| | | | | | |
|
| | | | | | |
|
| | | | | |
| | | | | | | |
|
| | | | | | |
|
| | | | | | |
|
|
Interest Rate Spread | | | | | | | 2.26 | % | | | | | | | 2.25 | % | | | | | | | 2.35 | % |
| | | | | | | |
|
| | | | | | |
|
| | | | | | |
|
|
| | | | | |
| | | | | | | |
| | | | | | | |
| | | |
Net Interest Income - FTE1 | | | | | $1,185.2 | | | | | | | | $1,173.9 | | | | | | | | $1,190.0 | | | |
| | | | | |
| | | | | | | |
| | | | | | | |
| | | |
| | | | | | | |
|
| | | | | | |
|
| | | | | | |
|
|
Net Interest Margin2 | | | | | | | 2.94 | % | | | | | | | 2.93 | % | | | | | | | 3.00 | % |
| | | | | | | |
|
| | | | | | |
|
| | | | | | |
|
|
1 | The fully taxable-equivalent (“FTE”) basis adjusts for the tax-favored status of net interest income from certain loans and investments. The Company believes this measure to be the preferred industry measurement of net interest income and it enhances comparability of net interest income arising from taxable and tax-exempt sources. |
2 | The net interest margin is calculated by dividing annualized net interest income - FTE by average total earning assets. |
Page 8
SunTrust Banks, Inc. and Subsidiaries
CONSOLIDATED DAILY AVERAGE BALANCES,
AVERAGE YIELDS EARNED AND RATES PAID
(Dollars in millions; yields on taxable-equivalent basis) (Unaudited)
| | | | | | | | | | | | | | | | |
| | | Six Months Ended
| |
| | | June 30, 2007
| | | June 30, 2006
| |
| | | Average
Balances
| | | Interest
Income/
Expense
| | Yields/
Rates
| | | Average
Balances
| | | Interest
Income/
Expense
| | Yields/
Rates
| |
ASSETS | | | | | | | | | | | | | | | | |
Loans: | | | | | | | | | | | | | | | | |
Real estate 1-4 family | | $32,412.5 | | | $1,020.6 | | 6.30 | % | | $32,926.7 | | | $971.5 | | 5.90 | % |
Real estate construction | | 13,571.0 | | | 512.1 | | 7.61 | | | 11,652.0 | | | 422.0 | | 7.30 | |
Real estate home equity lines | | 13,794.2 | | | 540.6 | | 7.90 | | | 13,454.1 | | | 488.7 | | 7.33 | |
Real estate commercial | | 12,780.9 | | | 441.0 | | 6.96 | | | 12,810.8 | | | 419.9 | | 6.61 | |
Commercial - FTE1 | | 33,819.1 | | | 1,075.2 | | 6.41 | | | 33,531.3 | | | 999.5 | | 6.01 | |
Business credit card | | 386.7 | | | 11.3 | | 5.87 | | | 292.6 | | | 9.0 | | 6.12 | |
Consumer - direct | | 4,284.3 | | | 154.2 | | 7.26 | | | 4,765.1 | | | 160.1 | | 6.78 | |
Consumer - indirect | | 8,114.8 | | | 245.1 | | 6.09 | | | 8,468.9 | | | 232.2 | | 5.53 | |
Nonaccrual and restructured | | 667.0 | | | 9.2 | | 2.80 | | | 312.6 | | | 7.2 | | 4.67 | |
| | |
|
| |
| |
|
| |
|
| |
| |
|
|
Total loans | | 119,830.5 | | | 4,009.3 | | 6.75 | | | 118,214.1 | | | 3,710.1 | | 6.33 | |
Securities available for sale: | | | | | | | | | | | | | | | | |
Taxable | | 8,844.5 | | | 276.3 | | 6.25 | | | 24,276.5 | | | 577.9 | | 4.76 | |
Tax-exempt - FTE1 | | 1,040.0 | | | 30.5 | | 5.86 | | | 925.1 | | | 27.1 | | 5.85 | |
| | |
|
| |
| |
|
| |
|
| |
| |
|
|
Total securities available for sale - FTE1 | | 9,884.5 | | | 306.8 | | 6.21 | | | 25,201.6 | | | 605.0 | | 4.80 | |
Funds sold and securities purchased under agreement to resell | | 1,022.3 | | | 26.1 | | 5.08 | | | 1,187.4 | | | 27.2 | | 4.55 | |
Loans held for sale | | 12,336.0 | | | 374.1 | | 6.07 | | | 10,640.5 | | | 341.6 | | 6.42 | |
Interest-bearing deposits | | 26.4 | | | 0.8 | | 5.71 | | | 159.5 | | | 2.7 | | 3.46 | |
Interest earning trading assets | | 15,429.0 | | | 403.2 | | 5.27 | | | 1,921.4 | | | 56.8 | | 5.96 | |
| | |
|
| |
| |
|
| |
|
| |
| |
|
|
Total earning assets | | 158,528.7 | | | 5,120.3 | | 6.51 | | | 157,324.5 | | | 4,743.4 | | 6.08 | |
Allowance for loan and lease losses | | (1,044.0 | ) | | | | | | | (1,044.0 | ) | | | | | |
Cash and due from banks | | 3,473.6 | | | | | | | | 3,977.4 | | | | | | |
Premises and equipment | | 1,990.5 | | | | | | | | 1,889.7 | | | | | | |
Other assets | | 14,460.3 | | | | | | | | 14,532.0 | | | | | | |
Noninterest earning trading assets | | 985.9 | | | | | | | | 940.0 | | | | | | |
Unrealized gains on securities available for sale, net | | 2,352.2 | | | | | | | | 1,570.2 | | | | | | |
| | |
|
| | | | | | |
|
| | | | | |
Total assets | | $180,747.2 | | | | | | | | $179,189.8 | | | | | | |
| | |
|
| | | | | | |
|
| | | | | |
| | | | | | |
LIABILITIES AND SHAREHOLDERS’ EQUITY | | | | | | | | | | | | | | | | |
Interest-bearing deposits: | | | | | | | | | | | | | | | | |
NOW accounts | | $19,943.6 | | | $235.0 | | 2.38 | % | | $16,905.1 | | | $127.5 | | 1.52 | % |
Money market accounts | | 21,930.3 | | | 284.8 | | 2.62 | | | 25,358.4 | | | 310.0 | | 2.47 | |
Savings | | 4,905.1 | | | 31.1 | | 1.28 | | | 5,225.7 | | | 31.2 | | 1.21 | |
Consumer time | | 16,876.2 | | | 373.6 | | 4.46 | | | 14,687.5 | | | 264.0 | | 3.63 | |
Other time | | 12,038.7 | | | 288.5 | | 4.83 | | | 10,182.7 | | | 206.5 | | 4.09 | |
| | |
|
| |
| |
|
| |
|
| |
| |
|
|
Total interest-bearing consumer and commercial deposits | | 75,693.9 | | | 1,213.0 | | 3.23 | | | 72,359.4 | | | 939.2 | | 2.62 | |
Brokered deposits | | 17,925.1 | | | 478.3 | | 5.31 | | | 16,576.1 | | | 391.4 | | 4.70 | |
Foreign deposits | | 7,416.1 | | | 195.8 | | 5.25 | | | 9,353.9 | | | 219.3 | | 4.66 | |
| | |
|
| |
| |
|
| |
|
| |
| |
|
|
Total interest-bearing deposits | | 101,035.1 | | | 1,887.1 | | 3.77 | | | 98,289.4 | | | 1,549.9 | | 3.18 | |
Funds purchased | | 4,328.4 | | | 113.4 | | 5.21 | | | 4,189.8 | | | 98.0 | | 4.65 | |
Securities sold under agreements to repurchase | | 6,552.4 | | | 154.0 | | 4.67 | | | 7,025.5 | | | 147.8 | | 4.18 | |
Other short-term borrowings | | 2,011.8 | | | 58.7 | | 5.88 | | | 1,557.8 | | | 43.2 | | 5.59 | |
Long-term debt | | 19,388.7 | | | 498.9 | | 5.19 | | | 19,420.0 | | | 515.1 | | 5.35 | |
| | |
|
| |
| |
|
| |
|
| |
| |
|
|
Total interest-bearing liabilities | | 133,316.4 | | | 2,712.1 | | 4.10 | | | 130,482.5 | | | 2,354.0 | | 3.64 | |
Noninterest-bearing deposits | | 22,165.7 | | | | | | | | 23,878.2 | | | | | | |
Other liabilities | | 7,440.3 | | | | | | | | 7,650.3 | | | | | | |
Shareholders’ equity | | 17,824.8 | | | | | | | | 17,178.8 | | | | | | |
| | |
|
| | | | | | |
|
| | | | | |
Total liabilities and shareholders’ equity | | $180,747.2 | | | | | | | | $179,189.8 | | | | | | |
| | |
|
| | | | | | |
|
| | | | | |
| | | | | | | |
|
| | | | | | |
|
|
Interest Rate Spread | | | | | | | 2.41 | % | | | | | | | 2.44 | % |
| | | | | | | |
|
| | | | | | |
|
|
| | | | | |
| | | | | | | |
| | | |
Net Interest Income - FTE1 | | | | | $2,408.2 | | | | | | | | $2,389.4 | | | |
| | | | | |
| | | | | | | |
| | | |
| | | | | | | |
|
| | | | | | |
|
|
Net Interest Margin2 | | | | | | | 3.06 | % | | | | | | | 3.06 | % |
| | | | | | | |
|
| | | | | | |
|
|
1 | The fully taxable-equivalent (“FTE”) basis adjusts for the tax-favored status of net interest income from certain loans and investments. The Company believes this measure to be the preferred industry measurement of net interest income and it enhances comparability of net interest income arising from taxable and tax-exempt sources. |
2 | The net interest margin is calculated by dividing annualized net interest income - FTE by average total earning assets. |
Page 9
SunTrust Banks, Inc. and Subsidiaries
OTHER FINANCIAL DATA
(Dollars in thousands) (Unaudited)
| | | | | | | | | | | | | | | | | | |
| | | Three Months Ended
| | |
| | | Six Months Ended
| | |
| |
| | | June 30
| | | % | | | June 30
| | | % | |
| | | 2007
| | | 2006
| | | Change1
| | | 2007
| | | 2006
| | | Change1
| |
CREDIT DATA | | | | | | | | | | | | | | | | | | |
Allowance for loan and lease losses - beginning | | $1,033,939 | | | $1,039,247 | | | (0.5 | )% | | $1,044,521 | | | $1,028,128 | | | 1.6 | % |
Provision for loan losses | | 104,680 | | | 51,759 | | | NM | | | 161,121 | | | 85,162 | | | 89.2 | |
Allowance associated with loans at fair value2 | | - | | | - | | | - | | | (4,100 | ) | | - | | | (100.0 | ) |
Charge-offs | | | | | | | | | | | | | | | | | | |
Commercial | | (40,853 | ) | | (19,155 | ) | | NM | | | (63,133 | ) | | (32,608 | ) | | 93.6 | |
Real estate: | | | | | | | | | | | | | | | | | | |
Home equity lines | | (24,429 | ) | | (5,534 | ) | | NM | | | (40,301 | ) | | (11,318 | ) | | NM | |
Construction | | (1,468 | ) | | (109 | ) | | NM | | | (2,066 | ) | | (237 | ) | | NM | |
Residential mortgages | | (19,615 | ) | | (6,373 | ) | | NM | | | (33,908 | ) | | (12,677 | ) | | NM | |
Commercial real estate | | (694 | ) | | (2,346 | ) | | (70.4 | ) | | (981 | ) | | (3,307 | ) | | (70.3 | ) |
Consumer: | | | | | | | | | | | | | | | | | | |
Direct | | (5,362 | ) | | (5,408 | ) | | (0.9 | ) | | (11,218 | ) | | (11,542 | ) | | (2.8 | ) |
Indirect | | (19,301 | ) | | (16,724 | ) | | 15.4 | | | (45,062 | ) | | (38,226 | ) | | 17.9 | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Total charge-offs | | (111,722 | ) | | (55,649 | ) | | NM | | | (196,669 | ) | | (109,915 | ) | | 78.9 | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Recoveries | | | | | | | | | | | | | | | | | | |
Commercial | | 5,536 | | | 6,595 | | | (16.1 | ) | | 11,307 | | | 13,678 | | | (17.3 | ) |
Real estate: | | | | | | | | | | | | | | | | | | |
Home equity lines | | 2,323 | | | 1,743 | | | 33.3 | | | 3,506 | | | 3,693 | | | (5.1 | ) |
Construction | | 244 | | | 711 | | | (65.7 | ) | | 363 | | | 765 | | | (52.5 | ) |
Residential mortgages | | 1,614 | | | 2,123 | | | (24.0 | ) | | 3,027 | | | 4,392 | | | (31.1 | ) |
Commercial real estate | | 162 | | | 595 | | | (72.8 | ) | | 203 | | | 3,989 | | | (94.9 | ) |
Consumer: | | | | | | | | | | | | | | | | | | |
Direct | | 2,568 | | | 3,014 | | | (14.8 | ) | | 5,021 | | | 6,608 | | | (24.0 | ) |
Indirect | | 11,018 | | | 11,724 | | | (6.0 | ) | | 22,062 | | | 25,362 | | | (13.0 | ) |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Total recoveries | | 23,465 | | | 26,505 | | | (11.5 | ) | | 45,489 | | | 58,487 | | | (22.2 | ) |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Net charge-offs | | (88,257 | ) | | (29,144 | ) | | NM | | | (151,180 | ) | | (51,428 | ) | | NM | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Allowance for loan and lease losses - ending | | $1,050,362 | | | $1,061,862 | | | (1.1 | ) | | $1,050,362 | | | $1,061,862 | | | (1.1 | ) |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Net charge-offs to average loans (annualized) | | | | | | | | | | | | | | | | | | |
Commercial | | 0.42 | % | | 0.15 | % | | NM | % | | 0.30 | % | | 0.11 | % | | NM | % |
Real estate: | | | | | | | | | | | | | | | | | | |
Home equity lines | | 0.64 | | | 0.11 | | | NM | | | 0.54 | | | 0.11 | | | NM | |
Construction | | 0.04 | | | (0.02 | ) | | NM | | | 0.03 | | | (0.01 | ) | | NM | |
Residential mortgages | | 0.23 | | | 0.05 | | | NM | | | 0.19 | | | 0.05 | | | NM | |
Commercial real estate | | 0.02 | | | 0.05 | | | (69.4 | ) | | 0.01 | | | (0.01 | ) | | NM | |
Consumer: | | | | | | | | | | | | | | | | | | |
Direct | | 0.26 | | | 0.23 | | | 14.1 | | | 0.29 | | | 0.21 | | | 38.9 | |
Indirect | | 0.41 | | | 0.24 | | | 71.4 | | | 0.57 | | | 0.31 | | | 84.1 | |
Total net charge-offs to total average loans | | 0.30 | | | 0.10 | | | NM | | | 0.25 | | | 0.09 | | | NM | |
| | | | | | |
Period Ended | | | | | | | | | | | | | | | | | | |
| | | | | | |
Nonaccrual loans | | | | | | | | | | | | | | | | | | |
Commercial | | $91,895 | | | $69,184 | | | 32.8 | % | | | | | | | | | |
Real estate: | | | | | | | | | | | | | | | | | | |
Construction | | 77,936 | | | 21,743 | | | NM | | | | | | | | | | |
Residential mortgages3 | | 511,566 | | | 136,101 | | | NM | | | | | | | | | | |
Commercial real estate | | 44,168 | | | 53,081 | | | (16.8 | ) | | | | | | | | | |
Consumer loans | | 11,235 | | | 18,861 | | | (40.4 | ) | | | | | | | | | |
| | |
|
| |
|
| | | | | | | | | | | | |
Total nonaccrual loans | | 736,800 | | | 298,970 | | | NM | | | | | | | | | | |
Restructured loans | | 27,816 | | | 28,292 | | | (1.7 | ) | | | | | | | | | |
| | |
|
| |
|
| | | | | | | | | | | | |
Total nonperforming loans | | 764,616 | | | 327,262 | | | NM | | | | | | | | | | |
Other real estate owned (OREO) | | 100,973 | | | 35,576 | | | NM | | | | | | | | | | |
Other repossessed assets | | 7,250 | | | 6,953 | | | 4.3 | | | | | | | | | | |
| | |
|
| |
|
| | | | | | | | | | | | |
Total nonperforming assets | | $872,839 | | | $369,791 | | | NM | | | | | | | | | | |
| | |
|
| |
|
| | | | | | | | | | | | |
Total accruing loans past due 90 days or more | | $449,038 | | | $284,938 | | | 57.6 | % | | | | | | | | | |
| | |
|
| |
|
| | | | | | | | | | | | |
Total nonperforming loans to total loans | | 0.64 | % | | 0.27 | % | | NM | % | | | | | | | | | |
Total nonperforming assets to total loans plus OREO and other repossessed assets | | 0.73 | | | 0.31 | | | NM | | | | | | | | | | |
Allowance to period-end loans | | 0.88 | | | 0.88 | | | - | | | | | | | | | | |
Allowance to nonperforming loans | | 137.4 | | | 324.5 | | | (57.7 | ) | | | | | | | | | |
1 | “NM” - Not meaningful. Those changes over 100 percent were not considered to be meaningful. |
2 | Amount removed from the allowance for loan losses related to the Company’s election to record $4.1 billion of residential mortgages at fair value. |
3 | Includes home equity lines on nonaccrual status. |
Page 10
SunTrust Banks, Inc. and Subsidiaries
FIVE QUARTER OTHER FINANCIAL DATA
(Dollars in thousands) (Unaudited)
| | | | | | | | | | | | | | | | | | |
| | | Three Months Ended
| |
| | | June 30 2007
| | | March 31 2007
| | | %
Change1
| | | December
31 2006
| | | September 30 2006
| | | June 30 2006
| |
CREDIT DATA | | | | | | | | | | | | | | | | | | |
Allowance for loan and lease losses - beginning | | $1,033,939 | | | $1,044,521 | | | (1.0 | )% | | $1,087,316 | | | $1,061,862 | | | $1,039,247 | |
Provision for loan losses | | 104,680 | | | 56,441 | | | 85.5 | | | 115,806 | | | 61,568 | | | 51,759 | |
Allowance associated with loans at fair value2 | | - | | | (4,100 | ) | | (100.0 | ) | | - | | | - | | | - | |
Charge-offs | | | | | | | | | | | | | | | | | | |
Commercial | | (40,853 | ) | | (22,280 | ) | | 83.4 | | | (127,831 | ) | | (23,062 | ) | | (19,155 | ) |
Real estate: | | | | | | | | | | | | | | | | | | |
Home equity lines | | (24,429 | ) | | (15,872 | ) | | 53.9 | | | (11,038 | ) | | (6,460 | ) | | (5,534 | ) |
Construction | | (1,468 | ) | | (598 | ) | | NM | | | (1,230 | ) | | (814 | ) | | (109 | ) |
Residential mortgages | | (19,615 | ) | | (14,293 | ) | | 37.2 | | | (7,806 | ) | | (9,113 | ) | | (6,373 | ) |
Commercial real estate | | (694 | ) | | (287 | ) | | NM | | | (4,256 | ) | | (487 | ) | | (2,346 | ) |
Consumer: | | | | | | | | | | | | | | | | | | |
Direct | | (5,362 | ) | | (5,856 | ) | | (8.4 | ) | | (5,924 | ) | | (4,544 | ) | | (5,408 | ) |
Indirect | | (19,301 | ) | | (25,761 | ) | | (25.1 | ) | | (25,450 | ) | | (18,639 | ) | | (16,724 | ) |
| | |
|
| |
|
| | | | |
|
| |
|
| |
|
|
Total charge-offs | | (111,722 | ) | | (84,947 | ) | | 31.5 | | | (183,535 | ) | | (63,119 | ) | | (55,649 | ) |
| | |
|
| |
|
| | | | |
|
| |
|
| |
|
|
Recoveries | | | | | | | | | | | | | | | | | | |
Commercial | | 5,536 | | | 5,771 | | | (4.1 | ) | | 6,657 | | | 9,636 | | | 6,595 | |
Real estate: | | | | | | | | | | | | | | | | | | |
Home equity lines | | 2,323 | | | 1,183 | | | 96.4 | | | 1,529 | | | 1,618 | | | 1,743 | |
Construction | | 244 | | | 119 | | | NM | | | 755 | | | 520 | | | 711 | |
Residential mortgages | | 1,614 | | | 1,413 | | | 14.2 | | | 1,686 | | | 1,831 | | | 2,123 | |
Commercial real estate | | 162 | | | 41 | | | NM | | | 1,748 | | | 475 | | | 595 | |
Consumer: | | | | | | | | | | | | | | | | | | |
Direct | | 2,568 | | | 2,453 | | | 4.7 | | | 2,805 | | | 2,713 | | | 3,014 | |
Indirect | | 11,018 | | | 11,044 | | | (0.2 | ) | | 9,754 | | | 10,212 | | | 11,724 | |
| | |
|
| |
|
| | | | |
|
| |
|
| |
|
|
Total recoveries | | 23,465 | | | 22,024 | | | 6.5 | | | 24,934 | | | 27,005 | | | 26,505 | |
| | |
|
| |
|
| | | | |
|
| |
|
| |
|
|
Net charge-offs | | (88,257 | ) | | (62,923 | ) | | 40.3 | | | (158,601 | ) | | (36,114 | ) | | (29,144 | ) |
| | |
|
| |
|
| | | | |
|
| |
|
| |
|
|
Allowance for loan and lease losses - ending | | $1,050,362 | | | $1,033,939 | | | 1.6 | | | $1,044,521 | | | $1,087,316 | | | $1,061,862 | |
| | |
|
| |
|
| | | | |
|
| |
|
| |
|
|
Net charge-offs to average loans (annualized) | | | | | | | | | | | | | | | | | | |
Commercial | | 0.42 | % | | 0.19 | % | | NM | % | | 1.39 | % | | 0.15 | % | | 0.15 | % |
Real estate: | | | | | | | | | | | | | | | | | | |
Home equity lines | | 0.64 | | | 0.43 | | | 48.9 | | | 0.27 | | | 0.14 | | | 0.11 | |
Construction | | 0.04 | | | 0.01 | | | NM | | | 0.01 | | | 0.01 | | | (0.02 | ) |
Residential mortgages | | 0.23 | | | 0.15 | | | 54.1 | | | 0.07 | | | 0.08 | | | 0.05 | |
Commercial real estate | | 0.02 | | | 0.01 | | | 67.1 | | | 0.08 | | | - | | | 0.05 | |
Consumer: | | | | | | | | | | | | | | | | | | |
Direct | | 0.26 | | | 0.33 | | | (21.9 | ) | | 0.30 | | | 0.17 | | | 0.23 | |
Indirect | | 0.41 | | | 0.73 | | | (43.7 | ) | | 0.75 | | | 0.40 | | | 0.24 | |
Total net charge-offs to total average loans | | 0.30 | % | | 0.21 | % | | 42.9 | % | | 0.52 | % | | 0.12 | % | | 0.10 | % |
| | | | | | |
Period Ended | | | | | | | | | | | | | | | | | | |
Nonaccrual loans | | | | | | | | | | | | | | | | | | |
Commercial | | $91,895 | | | $118,737 | | | (22.6 | )% | | $106,769 | | | $263,684 | | | $69,184 | |
Real estate: | | | | | | | | | | | | | | | | | | |
Construction | | 77,936 | | | 54,885 | | | 42.0 | | | 38,646 | | | 26,508 | | | 21,743 | |
Residential mortgages3 | | 511,566 | | | 401,095 | | | 27.5 | | | 286,676 | | | 189,218 | | | 136,101 | |
Commercial real estate | | 44,168 | | | 47,463 | | | (6.9 | ) | | 55,365 | | | 54,394 | | | 53,081 | |
Consumer loans | | 11,235 | | | 15,141 | | | (25.8 | ) | | 16,302 | | | 22,685 | | | 18,861 | |
| | |
|
| |
|
| | | | |
|
| |
|
| |
|
|
Total nonaccrual loans | | 736,800 | | | 637,321 | | | 15.6 | | | 503,758 | | | 556,489 | | | 298,970 | |
Restructured loans | | 27,816 | | | 27,772 | | | 0.2 | | | 27,993 | | | 28,934 | | | 28,292 | |
| | |
|
| |
|
| | | | |
|
| |
|
| |
|
|
Total nonperforming loans | | 764,616 | | | 665,093 | | | 15.0 | | | 531,751 | | | 585,423 | | | 327,262 | |
Other real estate owned (OREO) | | 100,973 | | | 74,645 | | | 35.3 | | | 55,460 | | | 41,690 | | | 35,576 | |
Other repossessed assets | | 7,250 | | | 6,202 | | | 16.9 | | | 6,617 | | | 6,670 | | | 6,953 | |
| | |
|
| |
|
| | | | |
|
| |
|
| |
|
|
Total nonperforming assets | | $872,839 | | | $745,940 | | | 17.0 | | | $593,828 | | | $633,783 | | | $369,791 | |
| | |
|
| |
|
| | | | |
|
| |
|
| |
|
|
Total accruing loans past due 90 days or more | | $449,038 | | | $369,940 | | | 21.4 | % | | $353,515 | | | $301,878 | | | $284,938 | |
| | |
|
| |
|
| | | | |
|
| |
|
| |
|
|
Total nonperforming loans to total loans | | 0.64 | % | | 0.57 | % | | 12.3 | % | | 0.44 | % | | 0.48 | % | | 0.27 | % |
Total nonperforming assets to total loans plus OREO and other repossessed assets | | 0.73 | | | 0.64 | | | 14.1 | | | 0.49 | | | 0.52 | | | 0.31 | |
Allowance to period-end loans | | 0.88 | | | 0.88 | | | - | | | 0.86 | | | 0.90 | | | 0.88 | |
Allowance to nonperforming loans | | 137.4 | | | 155.5 | | | (11.6 | ) | | 196.4 | | | 185.7 | | | 324.5 | |
1 | “NM” - Not meaningful. Those changes over 100 percent were not considered to be meaningful. |
2 | Amount removed from the allowance for loan losses related to the Company’s election to record $4.1 billion of residential mortgages at fair value. |
3 | Includes home equity lines on nonaccrual status. |
Page 11
SunTrust Banks, Inc. and Subsidiaries
OTHER FINANCIAL DATA (continued)
(Dollars and shares in thousands, except per share data) (Unaudited)
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Three Months Ended June 30
| | | | | Six Months Ended June 30
| |
| | | Core
Deposit
Intangible
| | | Mortgage
Servicing
Rights
| | | Other
| | | Total
| | | | | Core
Deposit
Intangible
| | | Mortgage
Servicing
Rights
| | | Other
| | | Total
| |
OTHER INTANGIBLE ASSET ROLLFORWARD | | | | | | | | | | | | | | | | | | | | | | | | | | |
Balance, beginning of period | | $303,283 | | | $680,837 | | | $139,343 | | | $1,123,463 | | | | | $324,743 | | | $657,604 | | | $140,620 | | | $1,122,967 | |
Amortization | | (21,087 | ) | | (46,359 | ) | | (4,798 | ) | | (72,244 | ) | | | | (43,632 | ) | | (90,343 | ) | | (9,498 | ) | | (143,473 | ) |
Servicing rights originated | | - | | | 116,572 | | | - | | | 116,572 | | | | | - | | | 243,781 | | | - | | | 243,781 | |
Community Bank of Florida branch acquisition | | - | | | - | | | - | | | - | | | | | 1,085 | | | - | | | - | | | 1,085 | |
Reclass investment to trading assets | | - | | | - | | | - | | | - | | | | | - | | | - | | | (1,050 | ) | | (1,050 | ) |
Purchase of GenSpring (formerly AMA, LLC) minority shares | | - | | | - | | | - | | | - | | | | | - | | | - | | | 4,473 | | | 4,473 | |
Sale/securitization of mortgage servicing rights | | - | | | (30,676 | ) | | - | | | (30,676 | ) | | | | - | | | (90,668 | ) | | - | | | (90,668 | ) |
Issuance of noncompete agreement | | - | | | - | | | 4,231 | | | 4,231 | | | | | - | | | - | | | 4,231 | | | 4,231 | |
| | |
|
| |
|
| |
|
| |
|
| | | |
|
| |
|
| |
|
| |
|
|
Balance, June 30, 2006 | | $282,196 | | | $720,374 | | | $138,776 | | | $1,141,346 | | | | | $282,196 | | | $720,374 | | | $138,776 | | | $1,141,346 | |
| | |
|
| |
|
| |
|
| |
|
| | | |
|
| |
|
| |
|
| |
|
|
Balance, beginning of period | | $222,829 | | | $921,255 | | | $149,373 | | | $1,293,457 | | | | | $241,614 | | | $810,509 | | | $129,861 | | | $1,181,984 | |
Amortization | | (17,255 | ) | | (46,578 | ) | | (7,649 | ) | | (71,482 | ) | | | | (36,040 | ) | | (87,937 | ) | | (12,407 | ) | | (136,384 | ) |
Servicing rights originated | | - | | | 182,991 | | | - | | | 182,991 | | | | | - | | | 335,096 | | | - | | | 335,096 | |
Purchase of GenSpring (formerly AMA, LLC) minority shares | | - | | | - | | | 1,150 | | | 1,150 | | | | | - | | | - | | | 1,278 | | | 1,278 | |
Intangible assets obtained from sale upon merger of Lighthouse Partners, net1 | | - | | | - | | | - | | | - | | | | | - | | | - | | | 24,142 | | | 24,142 | |
Sale/securitization of mortgage servicing rights | | - | | | (115,656 | ) | | - | | | (115,656 | ) | | | | - | | | (115,656 | ) | | - | | | (115,656 | ) |
| | |
|
| |
|
| |
|
| |
|
| | | |
|
| |
|
| |
|
| |
|
|
Balance, June 30, 2007 | | $205,574 | | | $942,012 | | | $142,874 | | | $1,290,460 | | | | | $205,574 | | | $942,012 | | | $142,874 | | | $1,290,460 | |
| | |
|
| |
|
| |
|
| |
|
| | | |
|
| |
|
| |
|
| |
|
|
| | | | | |
| | | Three Months Ended
| | | | | | | | | | | | |
| | | June 30 2007
| | | March 31 2007
| | | December 31 2006
| | | September 30 2006
| | | June 30 2006
| | | | | | | | | | | | |
COMMON SHARE ROLLFORWARD | | | | | | | | | | | | | | | | | | | | | | | | | | |
Beginning balance | | 356,505 | | | 354,903 | | | 363,868 | | | 364,129 | | | 363,339 | | | | | | | | | | | | |
Common shares issued/exchanged for employee benefit plans, stock option, performance and restricted stock activity | | 1,228 | | | 2,218 | | | 961 | | | 1,379 | | | 790 | | | | | | | | | | | | |
Acquisition of treasury stock | | (8,680 | ) | | (616 | ) | | (9,926 | ) | | (1,640 | ) | | - | | | | | | | | | | | | |
| | |
|
| |
|
| |
|
| |
|
| |
| | | | | | | | | | | | |
Ending balance | | 349,053 | | | 356,505 | | | 354,903 | | | 363,868 | | | 364,129 | | | | | | | | | | | | |
| | |
|
| |
|
| |
|
| |
|
| |
| | | | | | | | | | | | |
COMMON STOCK REPURCHASE ACTIVITY | | | | | | | | | | | | | | | | | | | | | | | | | | |
Number of common shares repurchased2 | | 8,715 | | | 653 | | | 9,962 | | | 1,660 | | | 29 | | | | | | | | | | | | |
Average price per share of repurchased common shares | | $87.02 | | | $82.83 | | | $77.76 | | | $76.69 | | | $75.73 | | | | | | | | | | | | |
Total cost to acquire treasury shares | | $853,386 | | | $- | | | $870,669 | | | $125,752 | | | $- | | | | | | | | | | | | |
Maximum number of common shares that may yet be purchased under plans or programs3 | | 2,471 | 4 | | 11,151 | | | 11,767 | | | 8,360 | | | 10,000 | | | | | | | | | | | | |
1 | During the first quarter of 2007 SunTrust merged its wholly-owned subsidiary, Lighthouse Partners, into Lighthouse Investment Partners, LLC in exchange for a minority interest in Lighthouse Investment Partners, LLC and a revenue-sharing agreement. This transaction resulted in a $7.9 million decrease in existing intangible assets and a new intangible asset of $32.0 million. |
2 | This figure includes shares repurchased pursuant to SunTrust’s employee stock option plans, pursuant to which participants may pay the exercise price upon exercise of SunTrust stock options by surrendering shares of SunTrust common stock which the participant already owns. |
3 | In August 2006, the Board authorized the Company to repurchase up to an additional $1 billion or 13,333,334 shares of the Company’s Common Stock, under which authority the Company repurchased 9,926,589 shares during 2006 under an Accelerated Share Repurchase Agreement (“ASR”). The 3,406,745 shares remaining under the August 2006 authorization, combined with 8,360,000 shares remaining under Board authorization from April 2006, left the Company with authorization to repurchase up to 11,766,745 shares as of January 1, 2007. The Company completed the aforementioned ASR with the repurchase of 615,514 shares during the first quarter of 2007 and repurchased an additional 8,022,254 shares under an ASR announced in the Company’s 8-K filing on June 7, 2007. |
4 | Pursuant to the ASR described in the June 7, 2007 8-K, the Company may receive up to 1,691,176 additional shares at the expiration of the ASR without additional payment. |
The number of additional shares generally will be based on the volume weighted average share price of SunTrust’s common stock during the term of the ASR, subject to the maximum number of shares established during the hedge period of the ASR. The number of shares which the Company may repurchase on June 30, 2007 is reduced by the number of shares which will be delivered to us at the expiration of the ASR, which number cannot be computed at this time.
Page 12
SunTrust Banks, Inc. and Subsidiaries
RECONCILEMENT OF NON-GAAP MEASURES
APPENDIX A TO THE EARNINGS RELEASE
(Dollars in thousands) (Unaudited)
| | | | | | | | | | | | | | | | | | | | | |
| | | Three Months Ended
| | | Six Months Ended
| |
| | | June 30 2007
| | | March 31 2007
| | | December 31
2006
| | | September 30 2006
| | | June 30 2006
| | | June 30 2007
| | | June 30 2006
| |
NON-GAAP MEASURES PRESENTED IN THE EARNINGS RELEASE | | | | | | | | | | | | | | | | | | | | | |
Net income | | $681,431 | | | $521,296 | | | $506,354 | | | $535,588 | | | $544,002 | | | $1,202,727 | | | $1,075,529 | |
Securities (gains)/losses, net of tax | | (146,575 | ) | | (12 | ) | | (21,934 | ) | | 56,926 | | | (3,632 | ) | | (146,588 | ) | | (3,696 | ) |
| | |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
Net income excluding net securities gains and losses | | 534,856 | | | 521,284 | | | 484,420 | | | 592,514 | | | 540,370 | | | 1,056,139 | | | 1,071,833 | |
The Coca-Cola Company dividend, net of tax | | (13,218 | ) | | (14,580 | ) | | (13,316 | ) | | (13,317 | ) | | (13,316 | ) | | (27,798 | ) | | (26,633 | ) |
| | |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
Net income excluding net securities (gains)/losses and The Coca-Cola Company dividend | | 521,638 | | | 506,704 | | | 471,104 | | | 579,197 | | | 527,054 | | | 1,028,341 | | | 1,045,200 | |
Preferred dividends | | 7,519 | | | 7,363 | | | 7,729 | | | - | | | - | | | 14,882 | | | - | |
| | |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
Net income available to common shareholders excluding net securities (gains)/losses and The Coca-Cola Company dividend | | $514,119 | | | $499,341 | | | $463,375 | | | $579,197 | | | $527,054 | | | $1,013,459 | | | $1,045,200 | |
| | |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
Total average assets | | $179,996,457 | | | $181,506,369 | | | $182,343,274 | | | $180,500,921 | | | $180,744,146 | | | $180,747,241 | | | $179,189,849 | |
Average net unrealized securities gains | | (2,398,651 | ) | | (2,305,306 | ) | | (1,965,367 | ) | | (1,374,648 | ) | | (1,528,041 | ) | | (2,352,236 | ) | | (1,570,190 | ) |
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Average assets less net unrealized securities gains | | $177,597,806 | | | $179,201,063 | | | $180,377,907 | | | $179,126,273 | | | $179,216,105 | | | $178,395,005 | | | $177,619,659 | |
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Total average common shareholders’ equity | | $17,428,101 | | | $17,220,384 | | | $17,655,469 | | | $17,558,581 | | | $17,304,451 | | | $17,324,815 | | | $17,178,826 | |
Average accumulated other comprehensive income | | (1,206,487 | ) | | (1,074,497 | ) | | (1,202,004 | ) | | (821,317 | ) | | (915,885 | ) | | (1,140,856 | ) | | (939,652 | ) |
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Total average realized common shareholders’ equity | | $16,221,614 | | | $16,145,887 | | | $16,453,465 | | | $16,737,264 | | | $16,388,566 | | | $16,183,959 | | | $16,239,174 | |
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Return on average total assets | | 1.52 | % | | 1.16 | % | | 1.10 | % | | 1.18 | % | | 1.21 | % | | 1.34 | % | | 1.21 | % |
Impact of excluding net realized and unrealized securities (gains)/losses and The Coca-Cola Company dividend | | (0.34 | ) | | (0.01 | ) | | (0.06 | ) | | 0.10 | | | (0.03 | ) | | (0.18 | ) | | (0.02 | ) |
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Return on average total assets less net unrealized securities gains1 | | 1.18 | % | | 1.15 | % | | 1.04 | % | | 1.28 | % | | 1.18 | % | | 1.16 | % | | 1.19 | % |
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Return on average common shareholders’ equity | | 15.51 | % | | 12.10 | % | | 11.20 | % | | 12.10 | % | | 12.61 | % | | 13.83 | % | | 12.63 | % |
Impact of excluding net realized and unrealized securities (gains)/losses and The Coca-Cola Company dividend | | (2.80 | ) | | 0.44 | | | (0.03 | ) | | 1.63 | | | 0.29 | | | (1.20 | ) | | 0.35 | |
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Return on average realized common shareholders’ equity2 | | 12.71 | % | | 12.54 | % | | 11.17 | % | | 13.73 | % | | 12.90 | % | | 12.63 | % | | 12.98 | % |
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Efficiency ratio3 | | 52.69 | % | | 59.79 | % | | 59.67 | % | | 59.30 | % | | 58.78 | % | | 56.00 | % | | 59.29 | % |
Impact of excluding amortization of intangible assets | | (1.05 | ) | | (1.14 | ) | | (1.18 | ) | | (1.27 | ) | | (1.25 | ) | | (1.09 | ) | | (1.29 | ) |
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Tangible efficiency ratio4 | | 51.64 | % | | 58.65 | % | | 58.49 | % | | 58.03 | % | | 57.53 | % | | 54.91 | % | | 58.00 | % |
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Total shareholders’ equity | | $17,368,853 | | | $17,968,538 | | | $17,813,606 | | | $18,589,307 | | | $17,423,920 | | | | | | | |
Goodwill | | (6,897,050 | ) | | (6,896,723 | ) | | (6,889,860 | ) | | (6,903,001 | ) | | (6,900,222 | ) | | | | | | |
Other intangible assets including mortgage servicing rights (“MSRs”) | | (1,290,460 | ) | | (1,293,457 | ) | | (1,181,984 | ) | | (1,120,102 | ) | | (1,141,346 | ) | | | | | | |
Mortgage servicing rights | | 942,012 | | | 921,255 | | | 810,510 | | | 724,323 | | | 720,374 | | | | | | | |
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Tangible equity | | $10,123,355 | | | $10,699,613 | | | $10,552,272 | | | $11,290,527 | | | $10,102,726 | | | | | | | |
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| | | | | | |
Total assets | | $180,314,372 | | | $186,384,841 | | | $182,161,609 | | | $183,104,553 | | | $181,143,444 | | | | | | | |
Goodwill | | (6,897,050 | ) | | (6,896,723 | ) | | (6,889,860 | ) | | (6,903,001 | ) | | (6,900,222 | ) | | | | | | |
Other intangible assets including MSRs | | (1,290,460 | ) | | (1,293,457 | ) | | (1,181,984 | ) | | (1,120,102 | ) | | (1,141,346 | ) | | | | | | |
Mortgage servicing rights | | 942,012 | | | 921,255 | | | 810,510 | | | 724,323 | | | 720,374 | | | | | | | |
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|
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| | | | | | |
Tangible assets | | $173,068,874 | | | $179,115,916 | | | $174,900,275 | | | $175,805,773 | | | $173,822,250 | | | | | | | |
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Tangible equity to tangible assets5 | | 5.85 | % | | 5.97 | % | | 6.03 | % | | 6.42 | % | | 5.81 | % | | | | | | |
Net interest income | | $1,195,284 | | | $1,164,559 | | | $1,161,289 | | | $1,151,392 | | | $1,168,743 | | | $2,359,843 | | | $2,347,784 | |
Taxable-equivalent adjustment | | 24,668 | | | 23,713 | | | 23,877 | | | 22,468 | | | 21,283 | | | 48,381 | | | 41,621 | |
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Net interest income - FTE | | 1,219,952 | | | 1,188,272 | | | 1,185,166 | | | 1,173,860 | | | 1,190,026 | | | 2,408,224 | | | 2,389,405 | |
Noninterest income | | 1,154,622 | | | 878,906 | | | 882,566 | | | 858,931 | | | 875,369 | | | 2,033,528 | | | 1,726,875 | |
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Total revenue - FTE | | $2,374,574 | | | $2,067,178 | | | $2,067,732 | | | $2,032,791 | | | $2,065,395 | | | $4,441,752 | | | $4,116,280 | |
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Net securities (gains)/losses | | (236,412 | ) | | (20 | ) | | (35,377 | ) | | 91,816 | | | (5,858 | ) | | (236,432 | ) | | (5,962 | ) |
Net gain on sale of Bond Trustee business | | - | | | - | | | - | | | (112,759 | ) | | - | | | - | | | - | |
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Total revenue - FTE excluding net securities (gains)/losses and net gain on sale of Bond Trustee business6 | | $2,138,162 | | | $2,067,158 | | | $2,032,355 | | | $2,011,848 | | | $2,059,537 | | | $4,205,320 | | | $4,110,318 | |
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1 | SunTrust presents a return on average assets less net unrealized gains on securities. The foregoing numbers primarily reflect adjustments to remove the effects of the Company’s securities portfolio which includes the ownership by the Company of 43.7 million shares of The Coca-Cola Company as of June 30, 2007. The Company uses this information internally to gauge its actual performance in the industry. The Company believes that the return on average assets less the net unrealized securities gains is more indicative of the Company’s return on assets because it more accurately reflects the return on the assets that are related to the Company’s core businesses which are primarily customer relationship and customer transaction driven. The return on average assets less net unrealized gains on securities is computed by dividing annualized net income, excluding securities gains/losses and The Coca-Cola Company dividend, by average assets less net unrealized securities gains. |
2 | The Company believes that the return on average realized common shareholders’ equity is more indicative of the Company’s return on equity because the excluded equity relates primarily to the long term holding of a specific security. The return on average realized common shareholders’ equity is computed by dividing annualized net income available to common shareholders, excluding securities gains/losses and The Coca -Cola Company dividend, by average realized common shareholders’ equity. |
3 | Computed by dividing noninterest expense by total revenue—FTE. The efficiency ratios are presented on an FTE basis. The FTE basis adjusts for the tax-favored status of net interest income from certain loans and investments. The Company believes this measure to be the preferred industry measurement of net interest income and it enhances comparability of net interest income arising from taxable and tax-exempt sources. |
4 | SunTrust presents a tangible efficiency ratio which excludes the cost of intangible assets. The Company believes this measure is useful to investors because, by removing the effect of intangible asset costs (the level of which may vary from company to company) it allows investors to more easily compare the Company’s efficiency to other companies in the industry. This measure is utilized by management to assess the efficiency of the Company and its lines of business. |
5 | SunTrust presents a tangible equity to tangible assets ratio that excludes the impact of purchase accounting intangible assets. The Company believes this measure is useful to investors because, by removing the effect of intangible assets that result from merger and acquisition activity (the level of which may vary from company to company) it allows investors to more easily compare the Company’s capital adequacy to other companies in the industry. This measure is used by management to analyze capital adequacy. |
6 | SunTrust presents total revenue-FTE excluding realized net securities gains/losses and the net gain on the sale of the Bond Trustee business. The Company believes total revenue-FTE without net securities gains/losses is more indicative of the Company’s performance because it isolates income that is primarily customer relationship and customer transaction driven. SunTrust further excludes the net gain on the sale of the Bond Trustee business because the Company believes the exclusion of the net gain is more indicative of normalized operations. |
Page 13
SunTrust Banks, Inc. and Subsidiaries
RECONCILEMENT OF NON-GAAP MEASURES
APPENDIX A TO THE EARNINGS RELEASE, continued
(Dollars in thousands) (Unaudited)
| | | | | | | | | | | | | | | | | | | | | |
| | | Three Months Ended
| | | Six Months Ended
| |
| | | June 30 2007
| | | March 31 2007
| | | December 31 2006
| | | September 30 2006
| | | June 30 2006
| | | June 30 2007
| | | June 30 2006
| |
SELECTED NON-GAAP MEASURES PRESENTED IN THE EARNINGS RELEASE | | | | | | | | | | | | | | | | | | | | | |
Total revenue - FTE | | $2,374,574 | | | $2,067,178 | | | $2,067,732 | | | $2,032,791 | | | $2,065,395 | | | $4,441,752 | | | $4,116,280 | |
Gain on sale of shares of The Coca-Cola Company | | (234,806 | ) | | - | | | - | | | - | | | - | | | (234,806 | ) | | - | |
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|
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|
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Total revenue - FTE excluding gain on sale of shares of The Coca-Cola Company1 | | $2,139,768 | | | $2,067,178 | | | $2,067,732 | | | $2,032,791 | | | $2,065,395 | | | $4,206,946 | | | $4,116,280 | |
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Net income available to common shareholders | | $673,912 | | | $513,933 | | | $498,625 | | | $535,588 | | | $544,002 | | | $1,187,845 | | | $1,075,529 | |
Gain on sale of shares of The Coca-Cola Company, net of tax | | (145,580 | ) | | - | | | - | | | - | | | - | | | (145,580 | ) | | - | |
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Net income available to common shareholders excluding gain on sale of shares of The Coca-Cola Company1 | | $528,332 | | | $513,933 | | | $498,625 | | | $535,588 | | | $544,002 | | | $1,042,265 | | | $1,075,529 | |
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Diluted net income per average common share | | $1.89 | | | $1.44 | | | $1.39 | | | $1.47 | | | $1.49 | | | $3.33 | | | $2.96 | |
Impact of excluding gain on sale of shares of The Coca-Cola Company | | (0.41 | ) | | - | | | - | | | - | | | - | | | (0.41 | ) | | - | |
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Diluted net income per average common share excluding gain on sale of shares of The Coca-Cola Company1 | | $1.48 | | | $1.44 | | | $1.39 | | | $1.47 | | | $1.49 | | | $2.92 | | | $2.96 | |
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Efficiency ratio | | 52.69 | % | | 59.79 | % | | 59.67 | % | | 59.30 | % | | 58.78 | % | | 56.00 | % | | 59.29 | % |
Impact of gain on sale of shares of The Coca-Cola Company | | 5.78 | | | - | | | - | | | - | | | - | | | 3.12 | | | - | |
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Efficiency ratio excluding gain on sale of shares of The Coca-Cola Company1 | | 58.47 | % | | 59.79 | % | | 59.67 | % | | 59.30 | % | | 58.78 | % | | 59.12 | % | | 59.29 | % |
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Noninterest income | | $1,154,622 | | | $878,906 | | | $882,566 | | | $858,931 | | | $875,369 | | | $2,033,528 | | | $1,726,875 | |
Impact of gain on sale of shares of The Coca-Cola Company | | (234,806 | ) | | - | | | - | | | - | | | - | | | (234,806 | ) | | - | |
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Noninterest income excluding gain on sale of shares of The Coca-Cola Company1 | | $919,816 | | | $878,906 | | | $882,566 | | | $858,931 | | | $875,369 | | | $1,798,722 | | | $1,726,875 | |
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1 | SunTrust presents total revenue-FTE, net income available to common shareholders, diluted net income per average common share, efficiency ratio and noninterest income excluding the gain on sale of shares of The Coca-Cola Company. The Company believes these measures are more indicative of the Company’s performance because they exclude a large securities gain that is not a customer relationship or customer driven transaction. |
Page 14
SunTrust Banks, Inc. and Subsidiaries
QUARTER-TO-QUARTER COMPARISON - ACTUAL
APPENDIX B TO THE EARNINGS RELEASE
(Dollars in thousands) (Unaudited)
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Three Months Ended
| |
| | | June 30 2007
| | | March 31
2007
| | | Increase/
(Decrease)
| | | Sequential
Annualized2 %
| | | June 30 2007
| | | June 30 2006
| | | Increase/
(Decrease)
| |
| | | | | Amount
| | | %
| | | | | | Amount
| | | %
| |
STATEMENTS OF INCOME | | | | | | | | | | | | | | | | | | | | | | | | | | | |
NET INTEREST INCOME | | $1,195,284 | | | $1,164,559 | | | $30,725 | | | 2.6 | % | | 10.6 | % | | $1,195,284 | | | $1,168,743 | | | $26,541 | | | 2.3 | % |
Provision for loan losses | | 104,680 | | | 56,441 | | | 48,239 | | | 85.5 | | | NM | | | 104,680 | | | 51,759 | | | 52,921 | | | NM | |
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NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES | | 1,090,604 | | | 1,108,118 | | | (17,514 | ) | | (1.6 | ) | | (6.3 | ) | | 1,090,604 | | | 1,116,984 | | | (26,380 | ) | | (2.4 | ) |
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| | | |
NONINTEREST INCOME | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Service charges on deposit accounts | | 196,844 | | | 189,035 | | | 7,809 | | | 4.1 | | | 16.5 | | | 196,844 | | | 191,645 | | | 5,199 | | | 2.7 | |
Trust and investment management income | | 164,620 | | | 174,318 | | | (9,698 | ) | | (5.6 | ) | | (22.3 | ) | | 164,620 | | | 175,811 | | | (11,191 | ) | | (6.4 | ) |
Retail investment services | | 71,785 | | | 63,543 | | | 8,242 | | | 13.0 | | | 51.9 | | | 71,785 | | | 58,441 | | | 13,344 | | | 22.8 | |
Other charges and fees | | 118,358 | | | 118,137 | | | 221 | | | 0.2 | | | 0.7 | | | 118,358 | | | 113,948 | | | 4,410 | | | 3.9 | |
Investment banking income | | 61,999 | | | 50,157 | | | 11,842 | | | 23.6 | | | 94.4 | | | 61,999 | | | 60,481 | | | 1,518 | | | 2.5 | |
Trading account profits and commissions | | 16,437 | | | 90,201 | | | (73,764 | ) | | (81.8 | ) | | NM | | | 16,437 | | | 46,182 | | | (29,745 | ) | | (64.4 | ) |
Card fees | | 68,580 | | | 64,195 | | | 4,385 | | | 6.8 | | | 27.3 | | | 68,580 | | | 61,941 | | | 6,639 | | | 10.7 | |
Mortgage production related income | | 64,322 | | | (8,655 | ) | | 72,977 | | | NM | | | NM | | | 64,322 | | | 56,579 | | | 7,743 | | | 13.7 | |
Mortgage servicing related income | | 45,527 | | | 35,403 | | | 10,124 | | | 28.6 | | | NM | | | 45,527 | | | 31,401 | | | 14,126 | | | 45.0 | |
Net gain on sale upon merger of Lighthouse Partners | | - | | | 32,340 | | | (32,340 | ) | | (100.0 | ) | | NM | | | - | | | - | | | - | | | - | |
Other noninterest income | | 109,738 | | | 70,212 | | | 39,526 | | | 56.3 | | | NM | | | 109,738 | | | 73,082 | | | 36,656 | | | 50.2 | |
Net securities gains/(losses | | 236,412 | | | 20 | | | 236,392 | | | NM | | | NM | | | 236,412 | | | 5,858 | | | 230,554 | | | NM | |
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| | | |
Total noninterest income | | 1,154,622 | | | 878,906 | | | 275,716 | | | 31.4 | | | NM | | | 1,154,622 | | | 875,369 | | | 279,253 | | | 31.9 | |
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| | | |
NONINTEREST EXPENSE | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Employee compensation and benefits | | 710,613 | | | 699,000 | | | 11,613 | | | 1.7 | | | 6.6 | | | 710,613 | | | 689,073 | | | 21,540 | | | 3.1 | |
Net occupancy expense | | 84,650 | | | 86,257 | | | (1,607 | ) | | (1.9 | ) | | (7.5 | ) | | 84,650 | | | 81,710 | | | 2,940 | | | 3.6 | |
Outside processing and software | | 100,730 | | | 99,676 | | | 1,054 | | | 1.1 | | | 4.2 | | | 100,730 | | | 98,447 | | | 2,283 | | | 2.3 | |
Equipment expense | | 53,823 | | | 49,409 | | | 4,414 | | | 8.9 | | | 35.7 | | | 53,823 | | | 48,107 | | | 5,716 | | | 11.9 | |
Marketing and customer development | | 43,326 | | | 45,705 | | | (2,379 | ) | | (5.2 | ) | | (20.8 | ) | | 43,326 | | | 49,378 | | | (6,052 | ) | | (12.3 | ) |
Amortization of intangible assets | | 24,904 | | | 23,542 | | | 1,362 | | | 5.8 | | | 23.1 | | | 24,904 | | | 25,885 | | | (981 | ) | | (3.8 | ) |
Other noninterest expense | | 233,148 | | | 232,408 | | | 740 | | | 0.3 | | | 1.3 | | | 233,148 | | | 221,493 | | | 11,655 | | | 5.3 | |
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|
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| | | |
Total noninterest expense | | 1,251,194 | | | 1,235,997 | | | 15,197 | | | 1.2 | | | 4.9 | | | 1,251,194 | | | 1,214,093 | | | 37,101 | | | 3.1 | |
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| |
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| | | |
INCOME BEFORE INCOME TAXES | | 994,032 | | | 751,027 | | | 243,005 | | | 32.4 | | | NM | | | 994,032 | | | 778,260 | | | 215,772 | | | 27.7 | |
Provision for income taxes | | 312,601 | | | 229,731 | | | 82,870 | | | 36.1 | | | NM | | | 312,601 | | | 234,258 | | | 78,343 | | | 33.4 | |
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| | | |
NET INCOME | | 681,431 | | | 521,296 | | | 160,135 | | | 30.7 | | | NM | | | 681,431 | | | 544,002 | | | 137,429 | | | 25.3 | |
Preferred dividends | | 7,519 | | | 7,363 | | | 156 | | | 2.1 | | | 8.5 | | | 7,519 | | | - | | | 7,519 | | | 100.0 | |
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| | | | | | | |
|
| |
|
| |
|
| | | |
NET INCOME AVAILABLE TO COMMON SHAREHOLDERS | | 673,912 | | | 513,933 | | | 159,979 | | | 31.1 | | | NM | | | 673,912 | | | 544,002 | | | 129,910 | | | 23.9 | |
Gain on sale of shares of The Coca-Cola Company, net of tax | | (145,580 | ) | | - | | | (145,580 | ) | | (100.0 | ) | | NM | | | (145,580 | ) | | - | | | (145,580 | ) | | (100.0 | ) |
| | |
|
| |
|
| |
|
| | | | | | | |
|
| |
|
| |
|
| | | |
NET INCOME AVAILABLE TO COMMON SHAREHOLDERS EXCLUDING THE GAIN ON SALE OF SHARES OF THE COCA-COLA COMPANY1 | | $528,332 | | | $513,933 | | | $14,399 | | | 2.8 | % | | 11.2 | % | | $528,332 | | | $544,002 | | | ($15,670 | ) | | (2.9 | )% |
| | |
|
| |
|
| |
|
| | | | | | | |
|
| |
|
| |
|
| | | |
REVENUE AND NONINTEREST EXPENSE | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net interest income | | $1,195,284 | | | $1,164,559 | | | $30,725 | | | 2.6 | % | | 10.6 | % | | $1,195,284 | | | $1,168,743 | | | $26,541 | | | 2.3 | % |
Taxable-equivalent adjustment | | 24,668 | | | 23,713 | | | 955 | | | 4.0 | | | 16.1 | | | 24,668 | | | 21,283 | | | 3,385 | | | 15.9 | |
| | |
|
| |
|
| |
|
| | | | | | | |
|
| |
|
| |
|
| | | |
Net interest income - FTE | | 1,219,952 | | | 1,188,272 | | | 31,680 | | | 2.7 | | | 10.7 | | | 1,219,952 | | | 1,190,026 | | | 29,926 | | | 2.5 | |
Noninterest income | | 1,154,622 | | | 878,906 | | | 275,716 | | | 31.4 | | | NM | | | 1,154,622 | | | 875,369 | | | 279,253 | | | 31.9 | |
| | |
|
| |
|
| |
|
| | | | | | | |
|
| |
|
| |
|
| | | |
Total revenue - FTE | | 2,374,574 | | | 2,067,178 | | | 307,396 | | | 14.9 | | | 59.5 | | | 2,374,574 | | | 2,065,395 | | | 309,179 | | | 15.0 | |
Net securities (gains)/losses | | (236,412 | ) | | (20 | ) | | (236,392 | ) | | NM | | | NM | | | (236,412 | ) | | (5,858 | ) | | (230,554 | ) | | NM | |
| | |
|
| |
|
| |
|
| | | | | | | |
|
| |
|
| |
|
| | | |
Total revenue - FTE excluding net securities (gains)/losses1 | | $2,138,162 | | | $2,067,158 | | | $71,004 | | | 3.4 | % | | 13.7 | % | | $2,138,162 | | | $2,059,537 | | | $78,625 | | | 3.8 | % |
| | |
|
| |
|
| |
|
| | | | | | | |
|
| |
|
| |
|
| | | |
Noninterest expense | | $1,251,194 | | | $1,235,997 | | | 15,197 | | | 1.2 | % | | 4.9 | % | | $1,251,194 | | | $1,214,093 | | | 37,101 | | | 3.1 | % |
Compensation expense related to fair valued mortgage loans | | (12,400 | ) | | - | | | (12,400 | ) | | (100.0 | ) | | NM | | | (12,400 | ) | | - | | | (12,400 | ) | | (100.0 | ) |
Leverage lease reserve reversal | | - | | | - | | | - | | | - | | | - | | | - | | | 10,923 | | | (10,923 | ) | | (100.0 | ) |
E2 initial implementation costs, net of corporate real estate gains | | 902 | | | (9,772 | ) | | 10,674 | | | NM | | | NM | | | 902 | | | (2,821 | ) | | 3,723 | | | NM | |
| | |
|
| |
|
| |
|
| | | | | | | |
|
| |
|
| |
|
| | | |
Noninterest expense excluding compensation expense related to fair valued mortgage loans, leverage lease reserve reversal and E2 implementation costs, net of corporate real estate gains3 | | $1,239,696 | | | $1,226,225 | | | $13,471 | | | 1.1 | % | | 4.4 | % | | $1,239,696 | | | $1,222,195 | | | $17,501 | | | 1.4 | % |
| | |
|
| |
|
| |
|
| | | | | | | |
|
| |
|
| |
|
| | | |
SELECTED AVERAGE BALANCES (Dollars in millions) | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Average loans | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Commercial | | $33,608 | | | $34,033 | | | ($425 | ) | | (1.2 | )% | | (5.0 | )% | | $33,608 | | | $33,993 | | | ($385 | ) | | (1.1 | )% |
Real estate home equity lines | | 13,850 | | | 13,738 | | | 112 | | | 0.8 | | | 3.2 | | | 13,850 | | | 13,517 | | | 333 | | | 2.5 | |
Real estate construction | | 13,710 | | | 13,430 | | | 280 | | | 2.1 | | | 8.3 | | | 13,710 | | | 12,181 | | | 1,529 | | | 12.5 | |
Real estate 1-4 family | | 30,754 | | | 34,089 | | | (3,335 | ) | | (9.8 | ) | | (39.1 | ) | | 30,754 | | | 34,348 | | | (3,594 | ) | | (10.5 | ) |
Real estate commercial | | 12,732 | | | 12,831 | | | (99 | ) | | (0.8 | ) | | (3.1 | ) | | 12,732 | | | 12,841 | | | (109 | ) | | (0.8 | ) |
Credit card | | 404 | | | 370 | | | 34 | | | 9.2 | | | 37.0 | | | 404 | | | 307 | | | 97 | | | 31.5 | |
Consumer - direct | | 4,347 | | | 4,220 | | | 127 | | | 3.0 | | | 12.0 | | | 4,347 | | | 4,251 | | | 96 | | | 2.3 | |
Consumer - indirect | | 8,064 | | | 8,166 | | | (102 | ) | | (1.2 | ) | | (5.0 | ) | | 8,064 | | | 8,386 | | | (322 | ) | | (3.8 | ) |
Nonaccrual and restructured | | 696 | | | 638 | | | 58 | | | 9.0 | | | 36.1 | | | 696 | | | 321 | | | 375 | | | NM | |
| | |
|
| |
|
| |
|
| | | | | | | |
|
| |
|
| |
|
| | | |
Total loans | | $118,165 | | | $121,515 | | | ($3,350 | ) | | (2.8 | )% | | (11.0 | )% | | $118,165 | | | $120,145 | | | ($1,980 | ) | | (1.6 | )% |
| | |
|
| |
|
| |
|
| | | | | | | |
|
| |
|
| |
|
| | | |
Average deposits | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Noninterest bearing deposits | | $22,396 | | | $21,933 | | | $463 | | | 2.1 | % | | 8.4 | % | | $22,396 | | | $23,858 | | | ($1,462 | ) | | (6.1 | )% |
NOW accounts | | 20,066 | | | 19,820 | | | 246 | | | 1.2 | | | 5.0 | | | 20,066 | | | 16,811 | | | 3,255 | | | 19.4 | |
Money market accounts | | 21,773 | | | 22,089 | | | (316 | ) | | (1.4 | ) | | (5.7 | ) | | 21,773 | | | 25,091 | | | (3,318 | ) | | (13.2 | ) |
Savings | | 4,787 | | | 5,025 | | | (238 | ) | | (4.7 | ) | | (18.9 | ) | | 4,787 | | | 5,161 | | | (374 | ) | | (7.3 | ) |
Consumer and other time | | 28,905 | | | 28,925 | | | (20 | ) | | (0.1 | ) | | (0.3 | ) | | 28,905 | | | 26,251 | | | 2,654 | | | 10.1 | |
| | |
|
| |
|
| |
|
| | | | | | | |
|
| |
|
| |
|
| |
|
|
Total consumer and commercial deposits | | 97,927 | | | 97,792 | | | 135 | | | 0.1 | | | 0.6 | | | 97,927 | | | 97,172 | | | 755 | | | 0.8 | |
Brokered and foreign deposits | | 23,983 | | | 26,714 | | | (2,731 | ) | | (10.2 | ) | | (40.9 | ) | | 23,983 | | | 27,194 | | | (3,211 | ) | | (11.8 | ) |
| | |
|
| |
|
| |
|
| | | | | | | |
|
| |
|
| |
|
| | | |
Total deposits | | $121,910 | | | $124,506 | | | ($2,596 | ) | | (2.1 | )% | | (8.3 | )% | | $121,910 | | | $124,366 | | | ($2,456 | ) | | (2.0 | )% |
| | |
|
| |
|
| |
|
| | | | | | | |
|
| |
|
| |
|
| | | |
SELECTED CREDIT DATA | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Nonaccrual loans | | $736,800 | | | $637,321 | | | $99,479 | | | 15.6 | % | | 62.4 | % | | $736,800 | | | $298,970 | | | $437,830 | | | NM | % |
Restructured loans | | 27,816 | | | 27,772 | | | 44 | | | 0.2 | | | 0.6 | | | 27,816 | | | 28,292 | | | (476 | ) | | (1.7 | ) |
| | |
|
| |
|
| |
|
| | | | | | | |
|
| |
|
| |
|
| | | |
Total nonperforming loans | | 764,616 | | | 665,093 | | | 99,523 | | | 15.0 | | | 59.9 | | | 764,616 | | | 327,262 | | | 437,354 | | | NM | |
Other real estate owned (OREO) | | 100,973 | | | 74,645 | | | 26,328 | | | 35.3 | | | NM | | | 100,973 | | | 35,576 | | | 65,397 | | | NM | |
Other repossessed assets | | 7,250 | | | 6,202 | | | 1,048 | | | 16.9 | | | 67.6 | | | 7,250 | | | 6,953 | | | 297 | | | 4.3 | |
| | |
|
| |
|
| |
|
| | | | | | | |
|
| |
|
| |
|
| | | |
Total nonperforming assets | | $872,839 | | | $745,940 | | | $126,899 | | | 17.0 | % | | 68.0 | % | | $872,839 | | | $369,791 | | | $503,048 | | | NM | % |
| | |
|
| |
|
| |
|
| | | | | | | |
|
| |
|
| |
|
| | | |
Allowance for loan and lease losses | | $1,050,362 | | | $1,033,939 | | | $16,423 | | | 1.6 | % | | 6.4 | % | | $1,050,362 | | | $1,061,862 | | | ($11,500 | ) | | (1.1 | )% |
| | |
|
| |
|
| |
|
| | | | | | | |
|
| |
|
| |
|
| | | |
1 | SunTrust presents selected financial data on a basis that excludes net securities gains/(losses) and the gain on the sale of shares of The Coca-Cola Company. The Company believes the exclusion of these items is more indicative of the Company’s performance because they exclude a large securities gain that is not a customer relationship or customer driven transaction. |
2 | Multiply percentage change by 4 to calculate sequential annualized change. Any sequential annualized change over 100 percent is labeled as “NM” because those changes over 100 percent were not considered to be meaningful. |
3 | SunTrust presents noninterest expense on a basis that excludes compensation expense related to fair valued mortgage loans, leverage lease reserve reversal, and E squared initial implementation costs, net of corporate real estate gains. The Company believes the exclusion of these items is more indicative of normalized operations |
Page 15
SunTrust Banks, Inc. and Subsidiaries
YEAR-TO-DATE COMPARISON - ACTUAL
APPENDIX B TO THE EARNINGS RELEASE, continued
(Dollars in thousands) (Unaudited)
| | | | | | | | | | | | |
| | | Six Months Ended
| |
| | | June 30 2007
| | | June 30 2006
| | | Increase/
(Decrease)
| |
| | | | | Amount
| | | %1
| |
STATEMENTS OF INCOME | | | | | | | | | | | | |
NET INTEREST INCOME | | $2,359,843 | | | $2,347,784 | | | $12,059 | | | 0.5 | % |
Provision for loan losses | | 161,121 | | | 85,162 | | | 75,959 | | | 89.2 | |
| | |
|
| |
|
| |
|
| | | |
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES | | 2,198,722 | | | 2,262,622 | | | (63,900 | ) | | (2.8 | ) |
| | |
|
| |
|
| |
|
| | | |
NONINTEREST INCOME | | | | | | | | | | | | |
Service charges on deposit accounts | | 385,879 | | | 377,830 | | | 8,049 | | | 2.1 | |
Trust and investment management income | | 338,938 | | | 343,900 | | | (4,962 | ) | | (1.4 | ) |
Retail investment services | | 135,328 | | | 113,430 | | | 21,898 | | | 19.3 | |
Other charges and fees | | 236,495 | | | 226,330 | | | 10,165 | | | 4.5 | |
Investment banking income | | 112,156 | | | 112,296 | | | (140 | ) | | (0.1 | ) |
Trading account profits and commissions | | 106,638 | | | 83,057 | | | 23,581 | | | 28.4 | |
Card fees | | 132,775 | | | 118,544 | | | 14,231 | | | 12.0 | |
Mortgage production related income | | 55,667 | | | 119,616 | | | (63,949 | ) | | (53.5 | ) |
Mortgage servicing related income | | 80,930 | | | 76,111 | | | 4,819 | | | 6.3 | |
Net gain on sale upon merger of Lighthouse Partners | | 32,340 | | | - | | | 32,340 | | | 100.0 | |
Other noninterest income | | 179,950 | | | 149,799 | | | 30,151 | | | 20.1 | |
Net securities gains/(losses) | | 236,432 | | | 5,962 | | | 230,470 | | | NM | |
| | |
|
| |
|
| |
|
| | | |
Total noninterest income | | 2,033,528 | | | 1,726,875 | | | 306,653 | | | 17.8 | |
| | |
|
| |
|
| |
|
| | | |
NONINTEREST EXPENSE | | | | | | | | | | | | |
Employee compensation and benefits | | 1,409,613 | | | 1,394,038 | | | 15,575 | | | 1.1 | |
Net occupancy expense | | 170,907 | | | 162,754 | | | 8,153 | | | 5.0 | |
Outside processing and software | | 200,406 | | | 193,339 | | | 7,067 | | | 3.7 | |
Equipment expense | | 103,232 | | | 97,555 | | | 5,677 | | | 5.8 | |
Marketing and customer development | | 89,031 | | | 92,024 | | | (2,993 | ) | | (3.3 | ) |
Amortization of intangible assets | | 48,446 | | | 53,130 | | | (4,684 | ) | | (8.8 | ) |
Other noninterest expense | | 465,556 | | | 447,744 | | | 17,812 | | | 4.0 | |
| | |
|
| |
|
| |
|
| | | |
Total noninterest expense | | 2,487,191 | | | 2,440,584 | | | 46,607 | | | 1.9 | |
| | |
|
| |
|
| |
|
| | | |
INCOME BEFORE INCOME TAXES | | 1,745,059 | | | 1,548,913 | | | 196,146 | | | 12.7 | |
Provision for income taxes | | 542,332 | | | 473,384 | | | 68,948 | | | 14.6 | |
| | |
|
| |
|
| |
|
| | | |
NET INCOME | | 1,202,727 | | | 1,075,529 | | | 127,198 | | | 11.8 | |
Preferred dividends | | 14,882 | | | - | | | 14,882 | | | 100.0 | |
| | |
|
| |
|
| |
|
| | | |
NET INCOME AVAILABLE TO COMMON SHAREHOLDERS | | 1,187,845 | | | 1,075,529 | | | 112,316 | | | 10.4 | |
Gain on sale of shares of The Coca-Cola Company, net of tax | | (145,580 | ) | | - | | | (145,580 | ) | | (100.0 | ) |
| | |
|
| |
|
| |
|
| | | |
NET INCOME AVAILABLE TO COMMON SHAREHOLDERS EXCLUDING THE GAIN ON SALE OF SHARES OF THE COCA-COLA COMPANY1 | | $1,042,265 | | | 1,075,529 | | | ($33,264 | ) | | (3.1 | )% |
| | |
|
| |
|
| |
|
| | | |
REVENUE AND NONINTEREST EXPENSE | | | | | | | | | | | | |
Net interest income | | $2,359,843 | | | $2,347,784 | | | $12,059 | | | 0.5 | % |
Taxable-equivalent adjustment | | 48,381 | | | 41,621 | | | 6,760 | | | 16.2 | |
| | |
|
| |
|
| |
|
| | | |
Net interest income - FTE | | 2,408,224 | | | 2,389,405 | | | 18,819 | | | 0.8 | |
Noninterest income | | 2,033,528 | | | 1,726,875 | | | 306,653 | | | 17.8 | |
| | |
|
| |
|
| |
|
| | | |
Total revenue - FTE | | 4,441,752 | | | 4,116,280 | | | 325,472 | | | 7.9 | |
Net securities (gains)/losses | | (236,432 | ) | | (5,962 | ) | | 230,470 | | | NM | |
| | |
|
| |
|
| |
|
| | | |
Total revenue - FTE excluding net securities (gains)/losses2 | | $4,205,320 | | | $4,110,318 | | | $95,002 | | | 2.3 | % |
| | |
|
| |
|
| |
|
| | | |
Noninterest expense | | $2,487,191 | | | $2,440,584 | | | 46,607 | | | 1.9 | % |
Compensation expense related to fair valued mortgage loans | | (12,400 | ) | | - | | | (12,400 | ) | | (100.0 | ) |
Leverage lease reserve reversal | | - | | | 10,923 | | | (10,923 | ) | | (100.0 | ) |
E2 initial implementation costs, net of corporate real estate gains | | (8,770 | ) | | (6,934 | ) | | (1,836 | ) | | 26.5 | |
| | |
|
| |
|
| |
|
| | | |
Noninterest expense excluding compensation expense related to fair valued mortgage loans, leverage lease reserve reversal and E2implementation costs, net of corporate real estate gains3 | | $2,466,021 | | | $2,444,573 | | | $21,448 | | | 0.9 | % |
| | |
|
| |
|
| |
|
| | | |
SELECTED AVERAGE BALANCES (Dollars in millions) | | | | | | | | | | | | |
Average loans | | | | | | | | | | | | |
Commercial | | $33,819 | | | $33,531 | | | $288 | | | 0.9 | % |
Real estate home equity lines | | 13,794 | | | 13,454 | | | 340 | | | 2.5 | |
Real estate construction | | 13,571 | | | 11,652 | | | 1,919 | | | 16.5 | |
Real estate 1-4 family | | 32,413 | | | 32,927 | | | (514 | ) | | (1.6 | ) |
Real estate commercial | | 12,781 | | | 12,811 | | | (30 | ) | | (0.2 | ) |
Credit card | | 387 | | | 293 | | | 94 | | | 32.2 | |
Consumer - direct | | 4,284 | | | 4,765 | | | (481 | ) | | (10.1 | ) |
Consumer - indirect | | 8,115 | | | 8,469 | | | (354 | ) | | (4.2 | ) |
Nonaccrual and restructured | | 667 | | | 312 | | | 355 | | | NM | |
| | |
|
| |
|
| |
|
| | | |
Total loans | | $119,831 | | | $118,214 | | | $1,617 | | | 1.4 | % |
| | |
|
| |
|
| |
|
| | | |
Average deposits | | | | | | | | | | | | |
Noninterest bearing deposits | | $22,166 | | | $23,878 | | | ($1,712 | ) | | (7.2 | )% |
NOW accounts | | 19,944 | | | 16,905 | | | $3,039 | | | 18.0 | |
Money market accounts | | 21,930 | | | 25,358 | | | (3,428 | ) | | (13.5 | ) |
Savings | | 4,905 | | | 5,226 | | | (321 | ) | | (6.1 | ) |
Consumer and other time | | 28,915 | | | 24,870 | | | 4,045 | | | 16.3 | |
| | |
|
| |
|
| |
|
| | | |
Total consumer and commercial deposits | | 97,860 | | | 96,237 | | | 1,623 | | | 1.7 | |
Brokered and foreign deposits | | 25,341 | | | 25,930 | | | (589 | ) | | (2.3 | ) |
| | |
|
| |
|
| |
|
| | | |
Total deposits | | $123,201 | | | $122,167 | | | $1,034 | | | 0.8 | % |
| | |
|
| |
|
| |
|
| | | |
1 | Any change over 100 percent is labeled as “NM”. Those changes over 100 percent were not considered to be meaningful. |
2 | SunTrust presents selected financial data on a basis that excludes net securities gains/(losses) and the gain on the sale of shares of The Coca-Cola Company. The Company believes the exclusion of these items is more indicative of the Company’s performance because they exclude a large securities gain that is not a customer relationship or customer driven transaction. |
3 | SunTrust presents noninterest expense on a basis that excludes compensation expense related to fair valued mortgage loans, leverage lease reserve reversal, and E2 initial implementation costs, net of corporate real estate gains. The Company believes the exclusion of these items is more indicative of normalized operations. |
Page 16
| | |
| Retail Line of Business | | PRELIMINARY DATA |
(Dollars in thousands) (Unaudited) | | |
| | | | | | | | | | | | | | | | | | |
| | | Three Months Ended
| | |
| | | Six Months Ended
| | |
| |
| | | June 30 2007
| | | June 30 2006
| | | %3
Change
| | | June 30 2007
| | | June 30 2006
| | | %3
Change
| |
Statement of Income | | | | | | | | | | | | | | | | | | |
Net interest income | | $580,514 | | | $590,499 | | | (1.7 | )% | | $1,156,774 | | | $1,165,937 | | | (0.8 | )% |
FTE adjustment | | 35 | | | 21 | | | 66.7 | | | 70 | | | 42 | | | 66.7 | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Net interest income - FTE | | 580,549 | | | 590,520 | | | (1.7 | ) | | 1,156,844 | | | 1,165,979 | | | (0.8 | ) |
Provision for loan losses1 | | 48,620 | | | 18,871 | | | NM | | | 93,606 | | | 38,589 | | | NM | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Net interest income after provision for loan losses - FTE | | 531,929 | | | 571,649 | | | (6.9 | ) | | 1,063,238 | | | 1,127,390 | | | (5.7 | ) |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Noninterest income before securities gains | | 267,672 | | | 265,747 | | | 0.7 | | | 526,631 | | | 523,260 | | | 0.6 | |
Securities gains, net | | - | | | - | | | - | | | 3 | | | - | | | 100.0 | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Total noninterest income | | 267,672 | | | 265,747 | | | 0.7 | | | 526,634 | | | 523,260 | | | 0.6 | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Noninterest expense before amortization of intangible assets | | 533,105 | | | 526,677 | | | 1.2 | | | 1,050,936 | | | 1,048,128 | | | 0.3 | |
Amortization of intangible assets | | 17,245 | | | 21,075 | | | (18.2 | ) | | 36,017 | | | 43,608 | | | (17.4 | ) |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Total noninterest expense | | 550,350 | | | 547,752 | | | 0.5 | | | 1,086,953 | | | 1,091,736 | | | (0.4 | ) |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Income before provision for income taxes | | 249,251 | | | 289,644 | | | (13.9 | ) | | 502,919 | | | 558,914 | | | (10.0 | ) |
Provision for income taxes | | 90,270 | | | 105,652 | | | (14.6 | ) | | 182,722 | | | 204,059 | | | (10.5 | ) |
FTE adjustment | | 35 | | | 21 | | | 66.7 | | | 70 | | | 42 | | | 66.7 | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Net income | | $158,946 | | | $183,971 | | | (13.6 | ) | | $320,127 | | | $354,813 | | | (9.8 | ) |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Total revenue - FTE | | $848,221 | | | $856,267 | | | (0.9 | ) | | $1,683,478 | | | $1,689,239 | | | (0.3 | ) |
| | | | | | |
Average Balance Sheet2 | | | | | | | | | | | | | | | | | | |
| | | | | | |
Total loans | | $31,579,084 | | | $30,437,883 | | | 3.7 | % | | $31,409,677 | | | $30,839,730 | | | 1.8 | % |
Goodwill | | 4,897,762 | | | 4,897,367 | | | - | | | 4,895,042 | | | 4,884,959 | | | 0.2 | |
Other intangible assets excluding MSRs | | 211,917 | | | 291,277 | | | (27.2 | ) | | 221,153 | | | 302,220 | | | (26.8 | ) |
Total assets | | 37,734,467 | | | 37,904,665 | | | (0.4 | ) | | 37,708,718 | | | 38,198,537 | | | (1.3 | ) |
Total deposits | | 68,743,828 | | | 69,539,701 | | | (1.1 | ) | | 69,015,114 | | | 68,384,403 | | | 0.9 | |
| | | | | | |
Performance Ratios | | | | | | | | | | | | | | | | | | |
| | | | | | |
Efficiency ratio | | 64.88 | % | | 63.97 | % | | | | | 64.57 | % | | 64.63 | % | | | |
Impact of excluding cost of intangible assets | | (5.89 | ) | | (6.24 | ) | | | | | (5.98 | ) | | (6.43 | ) | | | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Tangible efficiency ratio | | 58.99 | % | | 57.73 | % | | | | | 58.59 | % | | 58.20 | % | | | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
1 | Provision for loan losses represents net charge-offs for the lines of business. |
2 | Shareholders’ equity is not allocated to the lines of business at this time; business line performance does not include the funding benefit that would result from holding shareholders’ equity at the line of business level. |
3 | “NM” - Not meaningful. Those changes over 100 percent were not considered to be meaningful. |
Page 17
| | |
| Commercial Line of Business | | PRELIMINARY DATA |
(Dollars in thousands) (Unaudited) | | |
| | | | | | | | | | | | | | | | | | |
| | | Three Months Ended
| | |
| | | Six Months Ended
| | |
| |
| | | June 30 2007
| | | June 30 2006
| | | %
Change
| | | June 30 2007
| | | June 30 2006
| | | %
Change
| |
Statement of Income | | | | | | | | | | | | | | | | | | |
| | | | | | |
Net interest income | | $220,089 | | | $232,037 | | | (5.1 | )% | | $439,427 | | | $458,575 | | | (4.2 | )% |
FTE adjustment | | 9,359 | | | 9,971 | | | (6.1 | ) | | 18,886 | | | 19,935 | | | (5.3 | ) |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Net interest income - FTE | | 229,448 | | | 242,008 | | | (5.2 | ) | | 458,313 | | | 478,510 | | | (4.2 | ) |
Provision for loan losses1 | | 7,776 | | | 6,656 | | | 16.8 | | | 10,722 | | | 5,559 | | | 92.9 | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Net interest income after provision for loan losses - FTE | | 221,672 | | | 235,352 | | | (5.8 | ) | | 447,591 | | | 472,951 | | | (5.4 | ) |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Noninterest income before securities gains/(losses) | | 74,212 | | | 70,825 | | | 4.8 | | | 144,814 | | | 141,472 | | | 2.4 | |
Securities gains/(losses), net | | - | | | - | | | - | | | - | | | - | | | - | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Total noninterest income | | 74,212 | | | 70,825 | | | 4.8 | | | 144,814 | | | 141,472 | | | 2.4 | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Noninterest expense before amortization of intangible assets | | 165,311 | | | 167,875 | | | (1.5 | ) | | 334,947 | | | 339,110 | | | (1.2 | ) |
Amortization of intangible assets | | - | | | - | | | - | | | - | | | - | | | - | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Total noninterest expense | | 165,311 | | | 167,875 | | | (1.5 | ) | | 334,947 | | | 339,110 | | | (1.2 | ) |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Income before provision for income taxes | | 130,573 | | | 138,302 | | | (5.6 | ) | | 257,458 | | | 275,313 | | | (6.5 | ) |
Provision for income taxes | | 20,586 | | | 21,190 | | | (2.8 | ) | | 39,794 | | | 44,729 | | | (11.0 | ) |
FTE adjustment | | 9,359 | | | 9,971 | | | (6.1 | ) | | 18,886 | | | 19,935 | | | (5.3 | ) |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Net income | | $100,628 | | | $107,141 | | | (6.1 | ) | | $198,778 | | | $210,649 | | | (5.6 | ) |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Total revenue - FTE | | $303,660 | | | $312,833 | | | (2.9 | ) | | $603,127 | | | $619,982 | | | (2.7 | ) |
Average Balance Sheet2 | | | | | | | | | | | | | | | | | | |
Total loans | | $33,258,483 | | | $32,821,777 | | | 1.3 | % | | $33,056,392 | | | $32,219,821 | | | 2.6 | % |
Goodwill | | 1,262,176 | | | 1,264,845 | | | (0.2 | ) | | 1,262,176 | | | 1,263,115 | | | (0.1 | ) |
Other intangible assets excluding MSRs | | - | | | - | | | - | | | - | | | - | | | - | |
Total assets | | 35,683,882 | | | 35,290,908 | | | 1.1 | | | 35,476,602 | | | 34,662,079 | | | 2.3 | |
Total deposits | | 14,275,554 | | | 13,641,334 | | | 4.6 | | | 14,257,189 | | | 13,680,130 | | | 4.2 | |
| | | | | | |
Performance Ratios | | | | | | | | | | | | | | | | | | |
| | | | | | |
Efficiency ratio | | 54.44 | % | | 53.66 | % | | | | | 55.54 | % | | 54.70 | % | | | |
Impact of excluding cost of intangible assets | | (2.35 | ) | | (2.24 | ) | | | | | (2.40 | ) | | (2.30 | ) | | | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Tangible efficiency ratio | | 52.09 | % | | 51.42 | % | | | | | 53.14 | % | | 52.40 | % | | | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
1 | Provision for loan losses represents net charge-offs for the lines of business. |
2 | Shareholders’ equity is not allocated to the lines of business at this time; business line performance does not include the funding benefit that would result from holding shareholders’ equity at the line of business level. |
Page 18
| | |
| Corporate and Investment Banking Line of Business | | PRELIMINARY DATA |
(Dollars in thousands) (Unaudited) | | |
| | | | | | | | | | | | | | | | | | |
| | | Three Months Ended
| | |
| | | Six Months Ended
| | |
| |
| | | June 30 2007
| | | June 30 2006
| | | %3
Change
| | | June 30 2007
| | | June 30 2006
| | | %3
Change
| |
Statement of Income | | | | | | | | | | | | | | | | | | |
| | | | | | |
Net interest income | | $42,456 | | | $49,706 | | | (14.6 | )% | | $84,465 | | | $110,489 | | | (23.6 | )% |
FTE adjustment | | 10,995 | | | 7,500 | | | 46.6 | | | 20,946 | | | 14,107 | | | 48.5 | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Net interest income - FTE | | 53,451 | | | 57,206 | | | (6.6 | ) | | 105,411 | | | 124,596 | | | (15.4 | ) |
Provision for loan losses1 | | 14,600 | | | (435 | ) | | NM | | | 16,863 | | | (830 | ) | | NM | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Net interest income after provision for loan losses - FTE | | 38,851 | | | 57,641 | | | (32.6 | ) | | 88,548 | | | 125,426 | | | (29.4 | ) |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Noninterest income before securities gains/(losses) | | 199,155 | | | 159,274 | | | 25.0 | | | 344,475 | | | 315,386 | | | 9.2 | |
Securities gains/(losses), net | | - | | | - | | | - | | | - | | | - | | | - | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Total noninterest income | | 199,155 | | | 159,274 | | | 25.0 | | | 344,475 | | | 315,386 | | | 9.2 | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Noninterest expense before amortization of intangible assets | | 131,994 | | | 116,794 | | | 13.0 | | | 258,095 | | | 249,936 | | | 3.3 | |
Amortization of intangible assets | | 122 | | | 122 | | | - | | | 244 | | | 244 | | | - | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Total noninterest expense | | 132,116 | | | 116,916 | | | 13.0 | | | 258,339 | | | 250,180 | | | 3.3 | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Income before provision for income taxes | | 105,890 | | | 99,999 | | | 5.9 | | | 174,684 | | | 190,632 | | | (8.4 | ) |
Provision for income taxes | | 28,811 | | | 30,121 | | | (4.4 | ) | | 44,391 | | | 57,142 | | | (22.3 | ) |
FTE adjustment | | 10,995 | | | 7,500 | | | 46.6 | | | 20,946 | | | 14,107 | | | 48.5 | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Net income | | $66,084 | | | $62,378 | | | 5.9 | | | $109,347 | | | $119,383 | | | (8.4 | ) |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Total revenue - FTE | | $252,606 | | | $216,480 | | | 16.7 | | | $449,886 | | | $439,982 | | | 2.3 | |
Average Balance Sheet2 | | | | | | | | | | | | | | | | | | |
| | | | | | |
Total loans | | $15,234,660 | | | $16,394,765 | | | (7.1 | )% | | $15,752,200 | | | $16,197,153 | | | (2.7 | )% |
Goodwill | | 147,470 | | | 147,666 | | | (0.1 | ) | | 147,470 | | | 147,569 | | | (0.1 | ) |
Other intangible assets excluding MSRs | | 1,157 | | | 1,647 | | | (29.8 | ) | | 1,221 | | | 2,224 | | | (45.1 | ) |
Total assets | | 23,722,665 | | | 23,765,119 | | | (0.2 | ) | | 23,844,914 | | | 23,518,942 | | | 1.4 | |
Total deposits | | 2,779,900 | | | 2,999,145 | | | (7.3 | ) | | 2,789,906 | | | 3,337,324 | | | (16.4 | ) |
| | | | | | |
Performance Ratios | | | | | | | | | | | | | | | | | | |
| | | | | | |
Efficiency ratio | | 52.30 | % | | 54.01 | % | | | | | 57.42 | % | | 56.86 | % | | | |
Impact of excluding cost of intangible assets | | (0.38 | ) | | (0.46 | ) | | | | | (0.46 | ) | | (0.47 | ) | | | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Tangible efficiency ratio | | 51.92 | % | | 53.55 | % | | | | | 56.96 | % | | 56.39 | % | | | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
1 | Provision for loan losses represents net charge-offs for the lines of business. |
2 | Shareholders’ equity is not allocated to the lines of business at this time; business line performance does not include the funding benefit that would result from holding shareholders’ equity at the line of business level. |
3 | “NM” - Not meaningful. Those changes over 100 percent were not considered to be meaningful. |
Page 19
| | |
| Mortgage Line of Business | | PRELIMINARY DATA |
(Dollars in thousands) (Unaudited) | | |
| | | | | | | | | | | | | | | | | | |
| | | Three Months Ended
| | |
| | | Six Months Ended
| | |
| |
| | | June 30 2007
| | | June 30 2006
| | | %3
Change
| | | June 30 2007
| | | June 30 2006
| | | %3
Change
| |
Statement of Income | | | | | | | | | | | | | | | | | | |
Net interest income | | $135,485 | | | $149,361 | | | (9.3 | )% | | $266,163 | | | $298,197 | | | (10.7 | )% |
FTE adjustment | | - | | | - | | | - | | | - | | | - | | | - | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Net interest income - FTE | | 135,485 | | | 149,361 | | | (9.3 | ) | | 266,163 | | | 298,197 | | | (10.7 | ) |
Provision for loan losses1 | | 13,051 | | | 2,128 | | | NM | | | 23,260 | | | 5,000 | | | NM | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Net interest income after provision for loan losses - FTE | | 122,434 | | | 147,233 | | | (16.8 | ) | | 242,903 | | | 293,197 | | | (17.2 | ) |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Noninterest income before securities gains/(losses) | | 136,931 | | | 100,322 | | | 36.5 | | | 175,412 | | | 220,668 | | | (20.5 | ) |
Securities gains/(losses), net | | - | | | - | | | - | | | - | | | - | | | - | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Total noninterest income | | 136,931 | | | 100,322 | | | 36.5 | | | 175,412 | | | 220,668 | | | (20.5 | ) |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Noninterest expense before amortization of intangible assets | | 196,411 | | | 152,194 | | | 29.1 | | | 347,976 | | | 297,277 | | | 17.1 | |
Amortization of intangible assets | | 763 | | | 763 | | | - | | | 1,527 | | | 1,527 | | | - | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Total noninterest expense | | 197,174 | | | 152,957 | | | 28.9 | | | 349,503 | | | 298,804 | | | 17.0 | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Income before provision for income taxes | | 62,191 | | | 94,598 | | | (34.3 | ) | | 68,812 | | | 215,061 | | | (68.0 | ) |
Provision for income taxes | | 20,064 | | | 32,667 | | | (38.6 | ) | | 19,184 | | | 75,449 | | | (74.6 | ) |
FTE adjustment | | - | | | - | | | - | | | - | | | - | | | - | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Net income | | $42,127 | | | $61,931 | | | (32.0 | ) | | $49,628 | | | $139,612 | | | (64.5 | ) |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Total revenue - FTE | | $272,416 | | | $249,683 | | | 9.1 | | | $441,575 | | | $518,865 | | | (14.9 | ) |
| | | | | | |
Average Balance Sheet2 | | | | | | | | | | | | | | | | | | |
| | | | | | |
Total loans | | $29,447,549 | | | $32,009,078 | | | (8.0 | )% | | $30,906,163 | | | $30,478,394 | | | 1.4 | % |
Goodwill | | 276,635 | | | 275,705 | | | 0.3 | | | 276,310 | | | 263,015 | | | 5.1 | |
Other intangible assets excluding MSRs | | 3,503 | | | 6,562 | | | (46.6 | ) | | 3,901 | | | 6,942 | | | (43.8 | ) |
Total assets | | 47,866,786 | | | 41,088,776 | | | 16.5 | | | 46,076,743 | | | 40,335,162 | | | 14.2 | |
Total deposits | | 2,378,640 | | | 1,843,188 | | | 29.1 | | | 2,086,942 | | | 1,644,671 | | | 26.9 | |
| | | | | | |
Performance Ratios | | | | | | | | | | | | | | | | | | |
| | | | | | |
Efficiency ratio | | 72.38 | % | | 61.26 | % | | | | | 79.15 | % | | 57.59 | % | | | |
Impact of excluding cost of intangible assets | | (1.08 | ) | | (1.04 | ) | | | | | (1.41 | ) | | (0.93 | ) | | | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Tangible efficiency ratio | | 71.30 | % | | 60.22 | % | | | | | 77.74 | % | | 56.66 | % | | | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Other Information | | | | | | | | | | | | | | | | | | |
| | | | | | |
Production Data | | | | | | | | | | | | | | | | | | |
Channel mix | | | | | | | | | | | | | | | | | | |
Retail | | $6,767,535 | | | $6,571,921 | | | 3.0 | % | | $12,687,187 | | | $11,747,315 | | | 8.0 | % |
Wholesale | | 6,447,113 | | | 4,971,300 | | | 29.7 | | | 12,019,225 | | | 9,208,907 | | | 30.5 | |
Correspondent | | 4,745,579 | | | 3,486,658 | | | 36.1 | | | 8,080,169 | | | 5,624,910 | | | 43.6 | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Total production | | $17,960,227 | | | $15,029,879 | | | 19.5 | | | $32,786,581 | | | $26,581,132 | | | 23.3 | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Channel mix - percent | | | | | | | | | | | | | | | | | | |
Retail | | 38 | % | | 44 | % | | | | | 39 | % | | 44 | % | | | |
Wholesale | | 36 | | | 33 | | | | | | 37 | | | 35 | | | | |
Correspondent | | 26 | | | 23 | | | | | | 24 | | | 21 | | | | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Total production | | 100 | % | | 100 | % | | | | | 100 | % | | 100 | % | | | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Purchase and refinance mix | | | | | | | | | | | | | | | | | | |
Refinance | | $7,721,183 | | | $5,087,567 | | | 51.8 | | | $15,287,725 | | | $9,424,772 | | | 62.2 | |
Purchase | | 10,239,044 | | | 9,942,312 | | | 3.0 | | | 17,498,856 | | | 17,156,360 | | | 2.0 | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Total production | | $17,960,227 | | | $15,029,879 | | | 19.5 | | | $32,786,581 | | | $26,581,132 | | | 23.3 | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Purchase and refinance mix - percent | | | | | | | | | | | | | | | | | | |
Refinance | | 43 | % | | 34 | % | | | | | 47 | % | | 35 | % | | | |
Purchase | | 57 | | | 66 | | | | | | 53 | | | 65 | | | | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Total production | | 100 | % | | 100 | % | | | | | 100 | % | | 100 | % | | | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Applications | | $24,369,784 | | | $22,169,211 | | | 9.9 | | | $48,868,769 | | | $42,366,894 | | | 15.3 | |
| | | | | | |
Mortgage Servicing Data (End of Period) | | | | | | | | | | | | | | | | | | |
| | | | | | |
Total loans serviced | | $150,456,415 | | | $121,436,424 | | | 23.9 | % | | | | | | | | | |
Total loans serviced for others | | 105,123,313 | | | 80,511,802 | | | 30.6 | | | | | | | | | | |
Net carrying value of MSRs | | 942,012 | | | 720,263 | | | 30.8 | | | | | | | | | | |
Ratio of net carrying value of MSRs to total loans serviced for others | | 0.896 | % | | 0.895 | % | | | | | | | | | | | | |
1 | Provision for loan losses represents net charge-offs for the lines of business. |
2 | Shareholders’ equity is not allocated to the lines of business at this time; business line performance does not include the funding benefit that would result from holding shareholders’ equity at the line of business level. |
3 | “NM” - Not meaningful. Those changes over 100 percent were not considered to be meaningful. |
Page 20
| | |
| Wealth and Investment Management Line of Business | | PRELIMINARY DATA |
(Dollars in thousands) (Unaudited) | | |
| | | | | | | | | | | | | | | | | | |
| | | Three Months Ended
| | |
| | | Six Months Ended
| | |
| |
| | | June 30 2007
| | | June 30 2006
| | | %3
Change
| | | June 30 2007
| | | June 30 2006
| | | %3
Change
| |
Statement of Income | | | | | | | | | | | | | | | | | | |
Net interest income | | $86,975 | | | $91,215 | | | (4.6 | )% | | $176,050 | | | $181,178 | | | (2.8 | )% |
FTE adjustment | | 12 | | | 17 | | | (29.4 | ) | | 28 | | | 34 | | | (17.6 | ) |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Net interest income - FTE | | 86,987 | | | 91,232 | | | (4.7 | ) | | 176,078 | | | 181,212 | | | (2.8 | ) |
Provision for loan losses1 | | 2,951 | | | 751 | | | NM | | | 4,011 | | | 943 | | | NM | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Net interest income after provision for loan losses - FTE | | 84,036 | | | 90,481 | | | (7.1 | ) | | 172,067 | | | 180,269 | | | (4.5 | ) |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Noninterest income before securities gains/(losses) | | 248,963 | | | 251,103 | | | (0.9 | ) | | 533,518 | | | 489,453 | | | 9.0 | |
Securities gains/(losses), net | | 65 | | | (15 | ) | | NM | | | 9 | | | (53 | ) | | NM | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Total noninterest income | | 249,028 | | | 251,088 | | | (0.8 | ) | | 533,527 | | | 489,400 | | | 9.0 | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Noninterest expense before amortization of intangible assets | | 241,691 | | | 245,924 | | | (1.7 | ) | | 504,377 | | | 495,922 | | | 1.7 | |
Amortization of intangible assets | | 6,553 | | | 3,702 | | | 77.0 | | | 10,216 | | | 7,307 | | | 39.8 | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Total noninterest expense | | 248,244 | | | 249,626 | | | (0.6 | ) | | 514,593 | | | 503,229 | | | 2.3 | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Income before provision for income taxes | | 84,820 | | | 91,943 | | | (7.7 | ) | | 191,001 | | | 166,440 | | | 14.8 | |
Provision for income taxes | | 31,473 | | | 34,430 | | | (8.6 | ) | | 70,262 | | | 62,003 | | | 13.3 | |
FTE adjustment | | 12 | | | 17 | | | (29.4 | ) | | 28 | | | 34 | | | (17.6 | ) |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Net income | | $53,335 | | | $57,496 | | | (7.2 | ) | | $120,711 | | | $104,403 | | | 15.6 | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Total revenue - FTE | | $336,015 | | | $342,320 | | | (1.8 | ) | | $709,605 | | | $670,612 | | | 5.8 | |
| | | | | | |
Average Balance Sheet2 | | | | | | | | | | | | | | | | | | |
| | | | | | |
Total loans | | $8,026,076 | | | $8,063,724 | | | (0.5 | )% | | $8,110,682 | | | $8,106,158 | | | 0.1 | % |
Goodwill | | 304,262 | | | 305,456 | | | (0.4 | ) | | 314,363 | | | 301,745 | | | 4.2 | |
Other intangible assets excluding MSRs | | 136,557 | | | 123,825 | | | 10.3 | | | 127,020 | | | 123,124 | | | 3.2 | |
Total assets | | 8,941,690 | | | 8,853,497 | | | 1.0 | | | 9,002,749 | | | 8,874,153 | | | 1.4 | |
Total deposits | | 9,869,892 | | | 9,158,372 | | | 7.8 | | | 9,827,249 | | | 9,158,801 | | | 7.3 | |
| | | | | | |
Performance Ratios | | | | | | | | | | | | | | | | | | |
| | | | | | |
Efficiency ratio | | 73.88 | % | | 72.92 | % | | | | | 72.52 | % | | 75.04 | % | | | |
Impact of excluding cost of intangible assets | | (2.96 | ) | | (2.04 | ) | | | | | (2.38 | ) | | (2.08 | ) | | | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Tangible efficiency ratio | | 70.92 | % | | 70.88 | % | | | | | 70.14 | % | | 72.96 | % | | | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Other Information (End of Period) | | | | | | | | | | | | | | | | | | |
| | | | | | |
Assets under adminstration | | | | | | | | | | | | | | | | | | |
Managed (discretionary) assets | | $139,149,853 | | | $135,046,000 | | | 3.0 | % | | | | | | | | | |
Non-managed assets | | 60,290,599 | | | 51,072,000 | | | 18.1 | | | | | | | | | | |
| | |
|
| |
|
| | | | | | | | | | | | |
Total assets under administration | | 199,440,452 | | | 186,118,000 | | | 7.2 | | | | | | | | | | |
| | |
|
| |
|
| | | | | | | | | | | | |
Brokerage assets | | 42,494,858 | | | 35,016,000 | | | 21.4 | | | | | | | | | | |
Corporate trust assets | | 7,941,416 | | | 28,213,000 | | | (71.9 | ) | | | | | | | | | |
| | |
|
| |
|
| | | | | | | | | | | | |
Total assets under advisement | | $249,876,726 | | | $249,347,000 | | | 0.2 | | | | | | | | | | |
| | |
|
| |
|
| | | | | | | | | | | | |
1 | Provision for loan losses represents net charge-offs for the lines of business. |
2 | Shareholders’ equity is not allocated to the lines of business at this time; business line performance does not include the funding benefit that would result from holding shareholders’ equity at the line of business level. |
3 | “NM” - Not meaningful. Those changes over 100 percent were not considered to be meaningful. |
Page 21
| | |
| Corporate Other and Treasury | | PRELIMINARY DATA |
(Dollars in thousands) (Unaudited) | | |
| | | | | | | | | | | | | | | | | | |
| | | Three Months Ended
| | |
| | | Six Months Ended
| | |
| |
| | | June 30 2007
| | | June 30 2006
| | | %2
Change
| | | June 30 2007
| | | June 30 2006
| | | %2
Change
| |
Statement of Income | | | | | | | | | | | | | | | | | | |
Net interest income | | $129,765 | | | $55,925 | | | NM | % | | $236,964 | | | $133,408 | | | 77.6 | % |
FTE adjustment | | 4,267 | | | 3,774 | | | 13.1 | | | 8,451 | | | 7,503 | | | 12.6 | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Net interest income - FTE | | 134,032 | | | 59,699 | | | NM | | | 245,415 | | | 140,911 | | | 74.2 | |
Provision for loan losses1 | | 17,682 | | | 23,788 | | | (25.7 | ) | | 12,659 | | | 35,901 | | | (64.7 | ) |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Net interest income after provision for loan losses - FTE | | 116,350 | | | 35,911 | | | NM | | | 232,756 | | | 105,010 | | | NM | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Noninterest income before securities gains | | (8,723 | ) | | 22,240 | | | NM | | | 72,246 | | | 30,674 | | | NM | |
Securities gains, net | | 236,347 | | | 5,873 | | | NM | | | 236,420 | | | 6,015 | | | NM | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Total noninterest income | | 227,624 | | | 28,113 | | | NM | | | 308,666 | | | 36,689 | | | NM | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Noninterest expense before amortization of intangible assets | | (42,222 | ) | | (21,256 | ) | | 98.6 | | | (57,586 | ) | | (42,919 | ) | | 34.2 | |
Amortization of intangible assets | | 221 | | | 223 | | | (0.9 | ) | | 442 | | | 444 | | | (0.5 | ) |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Total noninterest expense | | (42,001 | ) | | (21,033 | ) | | 99.7 | | | (57,144 | ) | | (42,475 | ) | | 34.5 | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Income before provision for income taxes | | 385,975 | | | 85,057 | | | NM | | | 598,566 | | | 184,174 | | | NM | |
Provision for income taxes | | 121,397 | | | 10,198 | | | NM | | | 185,979 | | | 30,002 | | | NM | |
FTE adjustment | | 4,267 | | | 3,774 | | | 13.1 | | | 8,451 | | | 7,503 | | | 12.6 | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Net income | | $260,311 | | | $71,085 | | | NM | | | $404,136 | | | $146,669 | | | NM | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Total revenue - FTE | | $361,656 | | | $87,812 | | | NM | | | $554,081 | | | $177,600 | | | NM | |
| | | | | | |
Measures excluding securities gains/(losses), net | | | | | | | | | | | | | | | | | | |
| | | | | | |
Total revenue - FTE | | $361,656 | | | $87,812 | | | NM | % | | $554,081 | | | $177,600 | | | NM | % |
Securities gains, net | | (236,347 | ) | | (5,873 | ) | | NM | | | (236,420 | ) | | (6,015 | ) | | NM | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Total revenue - FTE excluding net securities gains3 | | $125,309 | | | $81,939 | | | 52.9 | | | $317,661 | | | $171,585 | | | 85.1 | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Net income | | $260,311 | | | $71,085 | | | NM | | | $404,136 | | | $146,669 | | | NM | |
Gain on sale of shares of The Coca-Cola Company, net of tax | | (145,580 | ) | | - | | | (100.0 | ) | | (145,580 | ) | | - | | | (100.0 | ) |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Net Income excluding gain on shares of The Coca-Cola Company4 | �� | $114,731 | | | $71,085 | | | 61.4 | | | $258,556 | | | $146,669 | | | 76.3 | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Average Balance Sheet | | | | | | | | | | | | | | | | | | |
| | | | | | |
Total loans | | $618,774 | | | $417,246 | | | 48.3 | % | | $595,391 | | | $372,828 | | | 59.7 | % |
Securities available for sale | | 17,524,366 | | | 25,494,198 | | | (31.3 | ) | | 20,116,132 | | | 25,132,642 | | | (20.0 | ) |
Goodwill | | 7,095 | | | 7,419 | | | (4.4 | ) | | 7,672 | | | 7,996 | | | (4.1 | ) |
Other intangible assets excluding MSRs | | 4,957 | | | 5,846 | | | (15.2 | ) | | 5,073 | | | 5,956 | | | (14.8 | ) |
Total assets | | 26,046,967 | | | 33,841,181 | | | (23.0 | ) | | 28,637,515 | | | 33,600,976 | | | (14.8 | ) |
| | | | | | |
Total deposits (mainly brokered and foreign) | | 23,861,897 | | | 27,184,891 | | | (12.2 | ) | | 25,224,469 | | | 25,962,278 | | | (2.8 | ) |
| | | | | | |
| | | | | | | | | | | | | | | | | | | |
| | |
|
| |
|
| | | | | | | | | | | | |
| | | June 30
2007
| | | December 31
2006
| | | | | | | | | | | | | |
Other Information | | | | | | | | | | | | | | | | | | |
| | | | | | |
Duration of investment portfolio | | 5.2 | % | | 3.1 | % | | | | | | | | | | | | |
Net interest income interest rate sensitivity: | | | | | | | | | | | | | | | | | | |
% Change in net interest income under: | | | | | | | | | | | | | | | | | | |
Instantaneous 100 bp increase in rates over next 12 months | | 0.3 | % | | (0.9 | )% | | | | | | | | | | | | |
Instantaneous 100 bp decrease in rates over next 12 months | | (0.7 | )% | | 1.0 | % | | | | | | | | | | | | |
1 | Provision for loan losses represents difference between net charge-offs for the lines of business and consolidated provision for loan losses. |
2 | “NM” - Not meaningful. Those changes over 100 percent were not considered to be meaningful. |
3 | SunTrust presents total revenue excluding realized securities gains/losses. The Company believes total revenue without the securities gains/losses is more indicative of the Company’s performance because it isolates income that is primarily customer relationship and customer transaction driven. |
4 | SunTrust presents net income avalable to common shareholders excluding the gain on sale of shares of the Coca-Cola Company. The Company believes that this measure is more indicative of the Company’s performance because it excludes a large securities gain that is not a customer relationship nor a customer driven transaction. |
Page 22
| | |
| Consolidated - Segment Totals | | PRELIMINARY DATA |
(Dollars in thousands) (Unaudited) | | |
| | | | | | | | | | | | | | | | | | |
| | | Three Months Ended
| | |
| | | Six Months Ended
| | |
| |
| | | June 30 2007
| | | June 30 2006
| | | %1
Change
| | | June 30 2007
| | | June 30 2006
| | | %1
Change
| |
Statement of Income | | | | | | | | | | | | | | | | | | |
Net interest income | | $1,195,284 | | | $1,168,743 | | | 2.3 | % | | $2,359,843 | | | $2,347,784 | | | 0.5 | % |
FTE adjustment | | 24,668 | | | 21,283 | | | 15.9 | | | 48,381 | | | 41,621 | | | 16.2 | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Net interest income - FTE | | 1,219,952 | | | 1,190,026 | | | 2.5 | | | 2,408,224 | | | 2,389,405 | | | 0.8 | |
Provision for loan losses | | 104,680 | | | 51,759 | | | NM | | | 161,121 | | | 85,162 | | | 89.2 | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Net interest income after provision for loan losses - FTE | | 1,115,272 | | | 1,138,267 | | | (2.0 | ) | | 2,247,103 | | | 2,304,243 | | | (2.5 | ) |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Noninterest income before securities gains/(losses) | | 918,210 | | | 869,511 | | | 5.6 | | | 1,797,096 | | | 1,720,913 | | | 4.4 | |
Securities gains/(losses), net | | 236,412 | | | 5,858 | | | NM | | | 236,432 | | | 5,962 | | | NM | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Total noninterest income | | 1,154,622 | | | 875,369 | | | 31.9 | | | 2,033,528 | | | 1,726,875 | | | 17.8 | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Noninterest expense before amortization of intangible assets | | 1,226,290 | | | 1,188,208 | | | 3.2 | | | 2,438,745 | | | 2,387,454 | | | 2.1 | |
Amortization of intangible assets | | 24,904 | | | 25,885 | | | (3.8 | ) | | 48,446 | | | 53,130 | | | (8.8 | ) |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Total noninterest expense | | 1,251,194 | | | 1,214,093 | | | 3.1 | | | 2,487,191 | | | 2,440,584 | | | 1.9 | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Income before provision for income taxes | | 1,018,700 | | | 799,543 | | | 27.4 | | | 1,793,440 | | | 1,590,534 | | | 12.8 | |
Provision for income taxes | | 312,601 | | | 234,258 | | | 33.4 | | | 542,332 | | | 473,384 | | | 14.6 | |
FTE adjustment | | 24,668 | | | 21,283 | | | 15.9 | | | 48,381 | | | 41,621 | | | 16.2 | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Net income | | $681,431 | | | $544,002 | | | 25.3 | | | $1,202,727 | | | 1,075,529 | | | 11.8 | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Total revenue - FTE | | $2,374,574 | | | 2,065,395 | | | 15.0 | | | $4,441,752 | | | $4,116,280 | | | 7.9 | |
| | | | | | |
Average Balance Sheet | | | | | | | | | | | | | | | | | | |
| | | | | | |
Total loans | | $118,164,626 | | | $120,144,473 | | | (1.6 | )% | | $119,830,505 | | | $118,214,084 | | | 1.4 | % |
Goodwill | | 6,895,400 | | | 6,898,458 | | | - | | | 6,903,033 | | | 6,868,399 | | | 0.5 | |
Other intangible assets excluding MSRs | | 358,091 | | | 429,157 | | | (16.6 | ) | | 358,368 | | | 440,466 | | | (18.6 | ) |
Total assets | | 179,996,457 | | | 180,744,146 | | | (0.4 | ) | | 180,747,241 | | | 179,189,849 | | | 0.9 | |
Total deposits | | 121,909,711 | | | 124,366,631 | | | (2.0 | ) | | 123,200,869 | | | 122,167,607 | | | 0.8 | |
| | | | | | |
Performance Ratios | | | | | | | | | | | | | | | | | | |
| | | | | | |
Efficiency ratio | | 52.69 | % | | 58.78 | % | | | | | 56.00 | % | | 59.29 | % | | | |
Impact of excluding cost of intangible assets | | (1.05 | ) | | (1.25 | ) | | | | | (1.09 | ) | | (1.29 | ) | | | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
Tangible efficiency ratio | | 51.64 | % | | 57.53 | % | | | | | 54.91 | % | | 58.00 | % | | | |
| | |
|
| |
|
| | | | |
|
| |
|
| | | |
1 | “NM” - Not meaningful. Those changes over 100 percent were not considered to be meaningful. |
Page 23
