1
EXHIBIT 99.2
- --------------------------------------------------------------------------------
SUNTRUST
AND
CRESTAR
A PRE-EMINENT PARTNERSHIP IN THE SOUTHEAST
July 20, 1998
- --------------------------------------------------------------------------------
2
FORWARD-LOOKING INFORMATION
- --------------------------------------------------------------------------------
This presentation contains estimates of future operating results for 1998, 1999
and 2000 for both SunTrust and Crestar on a stand-alone and pro forma combined
basis, as well as estimates of financial condition, operating efficiencies and
revenue creation on a combined basis. These estimates constitute forward-looking
statements (within the meaning of the Private Securities Litigation Reform Act
of 1995), which involve significant risks and uncertainties. Actual results may
differ materially from the results discussed in these forward-looking
statements. Factors that might cause such a difference include, but are not
limited to, general economic conditions, changes in interest rates, deposit
flows, loan demand, real estate values, and competition; changes in accounting
principles, policies, or guidelines; changes in legislation or regulation; and
other economic, competitive, governmental, regulatory, and technological factors
affecting each Company's operations, pricing, products and services.
- --------------------------------------------------------------------------------
2
3
OVERVIEW - CONTINUATION OF TRADITION
- --------------------------------------------------------------------------------
- - Consistent with SunTrust philosophy
- Accretive to earnings in first year
- Quality organization with leading market positions
- Proven management team
- Strong and growing markets
- Accelerates growth prospects - Maintains consistency
of earnings
- --------------------------------------------------------------------------------
3
4
- ------------------------------------------------------------------------------
TRANSACTION SUMMARY
- ------------------------------------------------------------------------------
5
TRANSACTION SUMMARY
- ------------------------------------------------------------------------------
Fixed Exchange Ratio: 0.96 SunTrust share for each Crestar share
Implied Price Per Crestar Share:(a) $83.94
Indicated Transaction Value:(a) $9.5 billion
Terms: 19.9% option granted to SunTrust,
9.9% option granted to Crestar
Structure: Pooling-of-interests; tax-free exchange
Due Diligence: Completed, including Y2K review
Closing: Expected late 4th quarter 1998
Key Closing Conditions: SunTrust and Crestar shareholder
approvals; customary regulatory approvals
(a) Based on SunTrust's closing stock price of $87.44 as of July 17, 1998 and
113.5 million fully diluted Crestar shares
- ------------------------------------------------------------------------------
5
6
FINANCIAL SUMMARY
- ------------------------------------------------------------------------------
- - Accretive to SunTrust's EPS by 3.6% in 1999 and by 4.4% in 2000
- - IRR of 16%
- - Conservative and realizable assumptions:
- Cost savings of $130 million - 17% of Crestar's core expenses
- Incremental income opportunities in core businesses
- Additional income from capital management strategies
- - Restructuring charges - $200 million (pretax)
- - Accounting and reserve alignments - $50 million (pretax)
- - Earnings growth increases to 12% from 11% (analyst estimates)
- ------------------------------------------------------------------------------
6
7
CREATES A POWERFUL COMBINATION
- -------------------------------------------------------------------------------
PRO FORMA
(Dollars in Millions) SUNTRUST(a) CRESTAR(a) COMBINED
----------- ---------- ------------
Market Capitalization(a) $18,249 $7,182 $25,431
Assets(b) 61,393 26,161 87,554
Deposits(b) 36,983 17,870 54,853
Loans(b) 41,647 15,951 57,598(c)
Realized Shareholders' Equity(b) 3,292 2,206 5,498
Total Shareholders' Equity(b) 5,912 2,206 8,118(c)
# of Banking Offices 697 396 1,093
States Served 4 3(d) 7
(a) Based on closing stock prices as of July 17, 1998
(b) As of June 30, 1998
(c) Excludes restructuring charges
(d) Includes District of Columbia
- -------------------------------------------------------------------------------
7
8
SOUTHEAST POSITION - EXPANDED FOOTPRINT
- -------------------------------------------------------------------------------
Maryland District of Columbia
#3 #5
Virginia
Tennessee #2
#4
Alabama Georgia
#2
Florida
#3
- SunTrust Branch (Map of Maryland, District of Columbia, Virginia,
- Crestar Branch Tennessee, Alabama, Georgia & Florida listing
SunTrust & Crestar Branch Locations)
- -------------------------------------------------------------------------------
8
9
RANK BY STATE - BALANCED AND LEADING
MARKET PRESENCE
- -------------------------------------------------------------------------------
PRO FORMA
--------------------------------------------------------
(Dollars in Millions) DEPOSITS(a) BRANCHES MARKET SHARE(a) RANK(a)
----------- ---------- --------------- -------
Georgia $10,266 212 12.6% 2
Virginia 10,090 239 11.9 2
Florida 18,454 367 10.1 3
Maryland 5,229 129 8.6 3
Tennessee 5,653 118 9.3 4
District of Columbia 923 28 12.7 5
Greater Washington(b) 8,200 185 15.3 1
(a) Source: SNL Database
(b) Includes $3.8 billion of deposits located in Virginia and $3.5 billion of
deposits located in Maryland
- -------------------------------------------------------------------------------
9
10
CREATING SHAREHOLDER VALUE
- ------------------------------------------------------------------------------
CONTRIBUTION%
---------------------------
(Dollars in Millions) PRO FORMA SUNTRUST CRESTAR
--------------- ------------- ------------
BALANCE SHEET ITEMS(A)
Total Assets $87,554 70% 30%
Total Shareholders' Equity 8,118 73 27
Total Tangible Equity 7,480 73 27
Realized Shareholders' Equity 5,498 60 40
NET INCOME
LTM Net Income $ 1,041 68 32
1998E Net Income(b) 1,085 68 32
1999E Net Income(b) 1,175 67 33
1999E Net Income with Synergies(c) 1,323 63 37
OWNERSHIP (SHARES IN MILLIONS)
FD Shares Outstanding
Including Share Reissue 321.4 66 34
(a) As of June 30, 1998
(b) Based on IBES median estimates
(c) Assumes fully phased-in synergies
- -------------------------------------------------------------------------------
10
11
IMPLIED TRANSACTION MULTIPLES
- ------------------------------------------------------------------------------
Multiple of Transaction Price Per Share To:
LTM EPS 28.3X
1998E EPS(a) 27.1
1999E EPA(a) 24.7
Book Value Per Share 4.27
(a) Based on SunTrust's closing stock price of $87.44 as of July 17, 1998 and
IBES median estimates
- ------------------------------------------------------------------------------
11
12
POWER OF A PREMIUM MULTIPLE
- ------------------------------------------------------------------------------
TRANSACTION MULTIPLE
AS % OF BUYER'S P/E(A)
---------------------------
BUYER SELLER CURRENT YEAR FORWARD YEAR
- ---------------------- ------------------ ------------- -------------
- ------------------------------------------------------------------------
SUNTRUST CRESTAR 108% 110%
- ------------------------------------------------------------------------
MARKET EXTENSION
Star Banc Firstar 97 107
Regions First Commercial 137 139
First American Deposit Guaranty 127 125
National City First of America 133 136
SOUTHEAST
NationsBank Barnett 153 167
First Union Signet 163 153
Wachovia Central Fidelity 122 122
(a) Based on IBES median estimates
- ------------------------------------------------------------------------------
12
13
- --------------------------------------------------------------------------------
REASONS FOR THE MERGER
- --------------------------------------------------------------------------------
14
STRATEGIC RATIONALE
- --------------------------------------------------------------------------------
- - Creation of a premier financial services franchise
- Leading market positions in 5 Southeastern States
- Premier platform in fastest growing Southeaster markets
- Emphasis on rapid growth fee businesses
- 8th largest U.S. banking company in market capitalization and 10th
largest in assets
- - Combination with preferred partner
- Similar market economies
- Comparable customer demographics
- Compatible management styles
- - Balance mix of consumer and corporate customers
- - Established record of strong credit culture
- - Excellent combined management team
- -------------------------------------------------------------------------------
14
15
FEE-BASED BUSINESSES - LARGE & GROWING(A)
- --------------------------------------------------------------------------------
(Dollars in Billions) SUNTRUST CRESTAR COMBINED
-------- ------- --------
Fee Income/Total Revenue 37% 33% 36%
Assets under Administration $100 $41 $141
Assets under Management 70 18 88
Mutual Fund Assets 12 5 17
Mortgage Loan Originations(b) 6.5 9.5 16
Mortgage Servicing Portfolio 18 14 32
(a) As of or for the quarter ended June 30, 1998
(b) Projected for full year 1998
- -------------------------------------------------------------------------------
15
16
BALANCED LOAN PORTFOLIO
- ------------------------------------------------------------------------------
(Dollars in Millions)
SUNTRUST(a) CRESTAR(b)
----------- ----------
Business Loans:
Commercial $16,198 $ 5,136
Real Estate -
Construction 1,452 403
Other 4,821 1,176
Consumer Loans:
Installment 4,615 5,386
Bank Card 983 507
Real Estate -
Mortgage 13,195 3,343
------- -------
TOTAL $41,264 $15,951
(a) As of March 31, 1998
(b) As of June 30, 1998
- ------------------------------------------------------------------------------
16
17
STRONG CORE DEPOSIT MIX
- ------------------------------------------------------------------------------
(Dollars in Millions)
SUNTRUST(a) CRESTAR(b)
----------- ----------
Demand Deposits $ 7,902 $ 3,766
Interest-Bearing Demand Deposits 10,909 6,919
Regular Savings Deposits 5,239 1,397
Domestic Time Deposits 6,878 3,920
CD $100,000 and Over 5,388 1,868
------- -------
TOTAL DEPOSITS $36,316 $17,870
- ------------------------------------------------------------------------------
(a) Average for the quarter ended March 31, 1998
(b) As of June 30, 1998
17
18
- ------------------------------------------------------------------------------
CRESTAR
MARKET REACH
- ------------------------------------------------------------------------------
19
THE CRESTAR FRANCHISE
- --------------------------------------------------------------------------------
- - $26 billion bank holding company
- - 396 banking offices and 684 ATMs in Virginia, Maryland and
Washington, D.C.
- - 1.2+ million households
- - 72,000 small business relationships
- - Baltimore/Washington - 4th largest consolidated MSA
- - Greater Washington region - highest per capita income in the nation
- --------------------------------------------------------------------------------
19
20
MARKET SHARE LEADERSHIP
- --------------------------------------------------------------------------------
- - Significant Commercial Banking Position
- 52% penetration in Virginia of companies with over $50M sales
- 35% penetration in Virginia of companies with $5-50M sales
- - Trust & Investment Management
- $41 billion in assets ($18 billion under management)
- #2 in region
- - Crestar Mortgage
- #1 in Virginia/#26 nationally
- $9.5 billion in projected 1998 originations
- - Student Lending
- Ranked in top 25 nationally
- #1 in Virginia, #6 in California
- --------------------------------------------------------------------------------
20
21
SOLID FINANCIAL PERFORMANCE
- ------------------------------------------------------------------------------
'93 '94 '95 '96 '97
EPS GROWTH(a)
11% CAGR $1.84 $2.24 $2.40 $2.33 $2.77
EFFICIENCY RATIO (%)(a) 66.4 65.1 60.8 58.4 54.5
(a) Originally reported, excluding merger related charges
- ------------------------------------------------------------------------------
21
22
SOLID FINANCIAL PERFORMANCE
- ------------------------------------------------------------------------------
'93 '94 '95 '96 '97
ROA (%)(a) 1.12 1.24 1.26 1.21 1.42
ROE (%)(a) 13.9 15.4 15.0 14.7 16.5
(a) Originally reported, excluding merger related charges
- ------------------------------------------------------------------------------
22
23
- ------------------------------------------------------------------------------
PRO FORMA
FINANCIAL IMPACT
- ------------------------------------------------------------------------------
24
Pro Forma Combined Earnings
- ------------------------------------------------------------------------------
(Dollars in Millions, Except Per Share Data)
1999 2000
------ ------
Net Income(a)
SunTrust Projected $ 792 $ 853
Crestar Projected 383 413
------ ------
Pro Forma Combined 1,175 1,266
------ ------
Adjustments (after tax)
Cost Savings 62 86
Incremental Income 13 18
Capital Management 48 83
------ ------
Pro Forma Earnings $1,298 $1,453
====== ======
Pro Forma EPS(b) $ 4.04 $ 4.52
Stand alone EPS 3.90 4.33
Accretion 3.6% 4.4%
(a) Based on IBES median estimates for both companies; Does NOT constitute
management forecasts; Excludes merger related changes
(b) Based on 321.4 million pro forma fully diluted shares
- ------------------------------------------------------------------------------
24
25
COST SAVINGS -
CONSERVATIVE AND READILY ATTAINABLE
- ------------------------------------------------------------------------------
(Dollars in Millions)
Business Line Optimization $ 30
System and Operations 50
G&A/Other 50
----
TOTAL $130
====
Note: Pretax based on 1999 fully phased-in cost savings
- ------------------------------------------------------------------------------
25
26
MERGER RELATED CHARGES
- ------------------------------------------------------------------------------
(Dollars in Millions)
Conversion Costs
- Bank Operations & Data Processing $ 45
- Other Operations 20
----
Total 65
Severance/Retention 100
Accounting & Reserve Alignments 50
Transaction-Related Costs 35
----
TOTAL (PRETAX) $250
====
- ------------------------------------------------------------------------------
26
27
ATTRACTIVE COMBINED PERFORMANCE RATIOS
- -------------------------------------------------------------------------------
Q2 1998 ANNUALIZED
------------------------------------------------
PHASED-IN
SUNTRUST CRESTAR COMBINED
------------- ----------- -------------
ROA 1.32%(a) 1.39% 1.48%
ROE 21.9 (a) 16.5 21.8
Net Interest Margin 3.96 4.06 4.00
Efficiency Ratio 60.24 53.63 56.19
(a) Excluding returns attributable to ownership of Coca-Cola stock
- -------------------------------------------------------------------------------
27
28
SUMMARY -
TRADITION OF SHAREHOLDER VALUE
- -------------------------------------------------------------------------------
- - Creates pre-eminent partnership in the Southeast
- - Accretive to SunTrust's EPS in first full year
- - Accelerates growth prospects
- - Maintains earnings consistency
- - Quality organization with proven management team
- - Leading positions in attractive markets
- -------------------------------------------------------------------------------
28
29
- -------------------------------------------------------------------------------
APPENDIX
- -------------------------------------------------------------------------------
30
STRONG COMBINED BALANCE SHEET
- -------------------------------------------------------------------------------
(Dollars in Millions) SUNTRUST(a) CRESTAR(a) PRO FORMA(b)
----------- ---------- ------------
Gross Loans $41,647 $15,951 $57,598
Loan Loss Reserve (763) (246) (1,009)
Other Assets 20,509 10,456 30,965
------- ------- -------
Total Assets $61,393 $26,161 $87,554
======= ======= =======
Deposits $36,983 $17,870 $54,853
Other Liabilities 18,498 6,085 24,583
------- ------- -------
Total Liabilities 55,481 23,955 79,436
Shareholders's Equity 5,912 2,206 8,118
------- ------- -------
Total Liabilities & Shareholders' Equity $61,393 $26,161 $87,554
======= ======= =======
(a) As of June 30, 1998
(b) Before transaction effects
- -------------------------------------------------------------------------------
30
31
CONSERVATIVE CAPITAL RATIOS
- -------------------------------------------------------------------------------
(Dollars in Millions, PRO
Except Per Share Data) SUNTRUST(a) CRESTAR(a) FORMA(b)
----------- ---------- --------
Total Shareholders' Equity $5,912 $2,206 $8,118
Book Value $28.32 $19.65 $25.65
Tangible Book Value $26.23 $17.88 $23.64
Total Equity/Total Assets 9.63% 8.43% 9.27%
Tangible Equity/Tangible Assets 8.98% 7.73% 8.61%
(a) As of June 30, 1998
(b) Before transaction effects
- -------------------------------------------------------------------------------
31
32
SUPERIOR CREDIT QUALITY
- -------------------------------------------------------------------------------
PRO
SUNTRUST(a) CRESTAR(a) FORMA(b)
----------- ---------- --------
Reserves/Gross Loans 1.83% 1.54% 1.75%
Net Charge-offs/Average Loans(c) 0.28 0.54 0.36
Non-Accrual Loans/Gross Loans 0.33 0.37 0.34
Non-Performing Assets/Gross 0.39 0.48 0.42
Loans & OREO
Reserves/Non-Performing Loans 558 415 515
(a) As of June 30, 1998
(b) Before transactions effects
(c) 2nd quarter 1998 net charge-offs, annualized
- -------------------------------------------------------------------------------
32
33
POWERFUL SOUTHEAST MARKET PRESENCE
- --------------------------------------------------------------------------------
(Dollars in millions)
MARYLAND
--------------------------------------------
INSTITUTION BRANCHES TOTAL SHARE
---------------- -------- ------- -------
1 NationsBank 210 $ 9,355 17.0
2 First Maryland 144 5,938 10.8
- ------------------------------------------------
3 SunTrust/Crestar 136 5,229 9.5
- ------------------------------------------------
4 Mercantile 153 5,144 9.3
5 First Union 129 4,173 7.6
Total 1,641 $55,102
TENNESSEE
--------------------------------------------
INSTITUTION BRANCHES TOTAL SHARE
---------------- -------- ----- -------
1 First Tennessee 160 $ 8,723 14.4
2 First American 195 8,309 13.7
3 Union Planters 193 6,739 11.1
- ------------------------------------------------
4 SunTrust/Crestar 141 5,653 9.3
- ------------------------------------------------
5 NationsBank 111 4,544 7.5
Total 1,786 $60,766
DISTRICT OF COLUMBIA
-------------------------------------------
INSTITUTION BRANCHES TOTAL SHARE
---------------- -------- ------- -------
1 Riggs National 35 $ 2,884 28.4
2 First Union 39 1,840 18.1
3 NationsBank 32 1,837 18.1
4 Citigroup 15 924 9.1
- ------------------------------------------------
5 SunTrust/Crestar 29 923 9.1
- ------------------------------------------------
Total 208 $10,160
VIRGINIA
--------------------------------------------
INSTITUTION BRANCHES TOTAL SHARE
---------------- -------- ----- -------
1 First Union 252 $13,100 17.2
- ------------------------------------------------
2 SunTrust/Crestar 242 10,090 13.3
- ------------------------------------------------
3 NationsBank 201 10,043 13.2
4 Wachovia 325 9,613 12.6
5 First Virginia 307 6,171 8.1
Total 2,400 $76,118
Source: SNL Securities
- --------------------------------------------------------------------------------
33
34
Powerful Southeast Market Presence
- --------------------------------------------------------------------------------
(Dollars in millions)
GEORGIA
---------------------------------------------------------------
INSTITUTION BRANCHES TOTAL SHARE
----------- -------- ------- -----
1 NationsBank 279 $14,050 17.2
- ------------------------------------------------------------------------
2 SunTrust/Crestar 219 10,266 12.6
- ------------------------------------------------------------------------
3 Wachovia 120 8,612 10.5
4 First Union 122 7,573 9.3
5 Synovus Financial 127 4,711 5.8
Total 2,052 $81,697
FLORIDA
---------------------------------------------------------------
INSTITUTION BRANCHES TOTAL SHARE
----------- -------- -------- -----
1 NationsBank 1,022 $ 52,794 28.8
2 First Union 554 29,752 16.2
- ------------------------------------------------------------------------
3 SunTrust/Crestar 380 18,454 10.1
- ------------------------------------------------------------------------
4 SouthTrust 275 10,042 5.5
5 Washington Mutual 120 7,031 3.8
Total 4,233 $183,620
ALABAMA
---------------------------------------------------------------
INSTITUTION BRANCHES TOTAL SHARE
----------- -------- ------- -----
1 Regions Financial 194 $ 8,971 19.0
2 SouthTrust 174 7,434 15.8
3 AmSouth Bancorp 126 6,709 14.2
4 Compass Bancshares 89 4,208 8.9
5 Colonial Bancgroup 128 3,276 7.0
- ------------------------------------------------------------------------
15 SunTrust/Crestar 9 306 0.7
- ------------------------------------------------------------------------
Total 1,371 $47,150
Source: SNL Securities
- --------------------------------------------------------------------------------
34