Exhibit 99
Tuesday Media Contact: Mary Eshet
January 26, 1999 704-383-7777 (office)
704-366-6492 (home)
Investor Contact: Alice Lehman
704-374-4139
Herb Althouse
704-383-9404
FIRST UNION ELIMINATES GAIN ON SALE TREATMENT
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CHARLOTTE - First Union announced today it is eliminating gain on sale treatment
for securitization activities related to B and C home equity loans. This
decision was made to reduce potential earnings volatility going forward.
"While this action has no impact on the economics of B and C home equity
lending, we estimate it will reduce earnings for 1999 by approximately eight
to twelve cents per share. For the year 2000 and beyond, the financial impact on
reported earnings will be positive," said Edward E. Crutchfield, First Union
chairman and chief executive officer.
"This accounting change, uncertainty in the economy and our continued
investments in strategic initiatives led us to conclude that an operating
earnings per share growth goal in the mid to high single digits in 1999 is
appropriate at this time," Crutchfield said. "Achieving this goal would result
in an estimated return on equity of 22 percent."
First Union reported operating earnings per share of $.83 and $3.77,
respectively, for the first quarter and the full year of 1998.
This news release contains various forward-looking statements. A discussion of
various factors, including factors beyond the company's control, that could
cause First Union's results to differ materially from those expressed in such
forward looking statements is included in First Union's Form 8-K, dated January
26, 1999, filed with the Securities and Exchange Commission.