SunTrust Banks, Inc. and Subsidiaries
FIVE QUARTER OTHER FINANCIAL DATA
(Dollars in thousands) (Unaudited)
Three Months Ended
June 30 March 31 Increase/(Decrease)
2008 2008 Amount % (1)
CREDIT DATA
Allowance for loan and
lease losses -
beginning $1,545,340 $1,282,504 $262,836 20.5 %
Provision for loan
losses 448,027 560,022 (111,995) (20.0)
Allowance from GB&T
acquisition 158,705 - 158,705 NM
Charge-offs
Commercial (47,738) (38,289) 9,449 24.7
Real estate:
Home equity
lines (94,857) (98,602) (3,745) (3.8)
Construction (35,399) (23,182) 12,217 52.7
Residential
mortgages (126,055) (109,186) 16,869 15.4
Commercial
real estate (563) (233) 330 NM
Consumer:
Direct (7,852) (10,315) (2,463) (23.9)
Indirect (43,101) (42,889) 212 0.5
Total
charge-offs (355,565) (322,696) 32,869 10.2
-
Recoveries
Commercial 7,255 5,736 1,519 26.5
Real estate:
Home equity
lines 5,650 2,368 3,282 NM
Construction 182 78 104 NM
Residential
mortgages 1,644 1,223 421 34.4
Commercial
real estate 35 162 (127) (78.4)
Consumer:
Direct 2,119 2,381 (262) (11.0)
Indirect 16,008 13,562 2,446 18.0
Total
recoveries 32,893 25,510 7,383 28.9
Net charge-offs (322,672) (297,186) 25,486 8.6
Allowance for loan and
lease losses - ending $1,829,400 $1,545,340 $284,060 18.4
Net charge-offs to
average loans
(annualized)
Commercial 0.42 % 0.35 % 0.07 % 20.7 %
Real estate:
Home equity
lines 2.40 2.65 (0.25) (9.6)
Construction 1.16 0.72 0.44 61.1
Residential
mortgages 1.49 1.29 0.20 15.4
Commercial
real estate 0.02 - 0.02 NM
Consumer:
Direct 0.53 0.79 (0.26) (33.4)
Indirect 1.46 1.53 (0.07) (4.7)
Total net charge-offs to
total average loans 1.04 0.97 0.07 7.2
Period Ended
Nonaccrual loans
Commercial $117,168 $97,930 $19,238 19.6 %
Real estate:
Home equity
lines 216,839 193,153 23,686 12.3
Construction 772,353 520,704 251,649 48.3
Residential
mortgages 1,356,710 1,115,071 241,639 21.7
Commercial
real estate 124,523 64,251 60,272 93.8
Consumer loans 37,735 46,851 (9,116) (19.5)
Total
nonaccrual
loans 2,625,328 2,037,960 587,368 28.8
Restructured loans 163,358 30,787 132,571 NM
Total nonperforming
loans 2,788,686 2,068,747 719,939 34.8
Other real estate
owned (OREO) 334,519 244,906 89,613 36.6
Other repossessed
assets 13,203 6,340 6,863 NM
Total nonperforming
assets $3,136,408 $2,319,993 $816,415 35.2
Total accruing loans
past due 90 days or
more $753,558 $743,969 $9,589 1.3 %
Total nonperforming
loans to total loans 2.22 % 1.67 % 0.55 % 32.9 %
Total nonperforming
assets to total loans
plus OREO and other
repossessed assets 2.49 1.87 0.62 33.2
Allowance to period-end
loans (2) 1.46 1.25 0.21 16.8
Allowance to
nonperforming loans (3) 72.0 81.6 (9.6) (11.7)
Allowance to annualized
net charge-offs 1.41 x 1.29 x 0.12 x 9.3
Three Months Ended
December 31 September 30 June 30
2007 2007 2007
CREDIT DATA
Allowance for loan and lease
losses - beginning $1,093,691 $1,050,362 $1,033,939
Provision for loan losses 356,781 147,020 104,680
Allowance from GB&T acquisition - - -
Charge-offs
Commercial (38,239) (39,487) (40,853)
Real estate:
Home equity lines (46,842) (29,075) (24,429)
Construction (7,616) (2,477) (1,468)
Residential mortgages (59,319) (19,853) (19,615)
Commercial real estate (299) (789) (694)
Consumer:
Direct (6,630) (5,661) (5,362)
Indirect (32,448) (28,944) (19,301)
Total charge-offs (191,393) (126,286) (111,722)
Recoveries
Commercial 6,613 6,322 5,536
Real estate:
Home equity lines 2,182 2,101 2,323
Construction 705 82 244
Residential mortgages 1,328 1,107 1,614
Commercial real estate 846 861 162
Consumer:
Direct 2,484 2,108 2,568
Indirect 9,267 10,014 11,018
Total recoveries 23,425 22,595 23,465
Net charge-offs (167,968) (103,691) (88,257)
Allowance for loan and lease
losses - ending $1,282,504 $1,093,691 $1,050,362
Net charge-offs to average
loans (annualized)
Commercial 0.35 % 0.38 % 0.42 %
Real estate:
Home equity lines 1.23 0.76 0.64
Construction 0.20 0.07 0.04
Residential mortgages 0.70 0.24 0.23
Commercial real estate (0.02) - 0.02
Consumer:
Direct 0.42 0.32 0.26
Indirect 1.16 0.94 0.41
Total net charge-offs to total
average loans 0.55 0.34 0.30
Period Ended
Nonaccrual loans
Commercial $74,463 $74,246 $91,895
Real estate:
Home equity lines 135,700 80,966 52,449
Construction 295,335 158,194 77,936
Residential mortgages 841,376 595,856 447,951
Commercial real estate 44,502 40,649 44,168
Consumer loans 39,031 24,880 22,401
Total nonaccrual
loans 1,430,407 974,791 736,800
Restructured loans 29,851 29,057 27,816
Total nonperforming loans 1,460,258 1,003,848 764,616
Other real estate owned
(OREO) 183,753 156,106 100,973
Other repossessed assets 11,536 9,974 7,250
Total nonperforming assets $1,655,547 $1,169,928 $872,839
Total accruing loans past due 90
days or more $611,003 $495,384 $449,038
Total nonperforming loans to
total loans 1.19 % 0.83 % 0.64 %
Total nonperforming assets to
total loans plus OREO and other
repossessed assets 1.35 0.97 0.73
Allowance to period-end loans (2) 1.05 0.91 0.89
Allowance to nonperforming loans (3) 99.5 125.2 160.7
Allowance to annualized net
charge-offs 1.92 x 2.66 x 2.97 x
(1) "NM" - Not meaningful. Those changes over 100 percent were not
considered to be meaningful.
(2) During the second quarter of 2008, the Company revised its method of
calculating this ratio to include, within the period-end loan amount,
only loans measured at amortized cost. Previously, period-end loans
included loans measured at fair value or the lower of cost or market.
The Company believes this is an improved method of calculation due to
the fact that the allowance for loan losses relates solely to the
loans measured at amortized cost. Loans measured at fair value or the
lower of cost or market that have been excluded from the prior periods
calculation were $450,662, $392,259, $131,514, and $110,841, as of
March 31, 2008, December 31, 2007, September 30, 2007 and June 30,
2007, respectively, which did not change the calculation by more than
one basis point as of March 31, 2008, December 31, 2007, September 30,
2007 or June 30, 2007, respectively.
(3) During the second quarter of 2008, the Company revised its method of
calculating this ratio to include, within the nonperforming loan
amount, only loans measured at amortized cost. Previously, this
calculation included nonperforming loans measured at fair value or the
lower of cost or market. The Company believes this is an improved
method of calculation due to the fact that the allowance for loan
losses relates solely to the loans measured at amortized cost.
Nonperforming loans measured at fair value or the lower of cost or
market that have been excluded from the prior periods calculation were
$173,752, $171,475, $129,962, and $110,841, as of March 31, 2008,
December 31, 2007, September 30, 2007 and June 30, 2007, respectively,
which increased the calculation approximately 7, 12, 16, and 23 basis
points as of March 31, 2008, December 31, 2007, September 30, 2007 and
June 30, 2007, respectively.
SunTrust Banks, Inc. and Subsidiaries
OTHER FINANCIAL DATA (continued)
(Dollars and shares in thousands, except per share data) (Unaudited)
Three Months Ended
June 30
Core Mortgage
Deposit Servicing
Intangible Rights Other Total
OTHER INTANGIBLE ASSET
ROLLFORWARD
Balance, beginning of period $222,829 $921,255 $149,373 $1,293,457
Amortization (17,255) (46,578) (7,649) (71,482)
Mortgage Servicing Rights
("MSRs") originated - 182,991 - 182,991
Purchase of GenSpring
(formerly AMA, LLC) minority
shares - - 1,150 1,150
Intangible assets obtained
from sale upon merger of
Lighthouse Partners, net(1) - - - -
Sale/securitization of MSRs - (115,656) - (115,656)
Balance June 30, 2007 $205,574 $942,012 $142,874 $1,290,460
Balance, beginning of period $157,703 $1,143,405 $129,160 $1,430,268
Amortization (14,228) (56,634) (5,506) (76,368)
MSRs originated - 145,974 - 145,974
MSRs impairment reserve - - - -
MSRs impairment recovery - 1,881 - 1,881
Sale of interest in Lighthouse
Partners - - - -
Sale/securitization of MSRs - (41,176) - (41,176)
Customer intangible impairment
charge - - (45,000) (45,000)
Acquisition of GB&T 29,510 - - 29,510
Sale of First Mercantile - - (3,033) (3,033)
Balance June 30, 2008 $172,985 $1,193,450 $75,621 $1,442,056
Six Months Ended
June 30
Core Mortgage
Deposit Servicing
Intangible Rights Other Total
OTHER INTANGIBLE ASSET
ROLLFORWARD
Balance, beginning of period $241,614 $810,509 $129,861 $1,181,984
Amortization (36,040) (87,937) (12,407) (136,384)
Mortgage Servicing Rights
("MSRs") originated - 335,096 - 335,096
Purchase of GenSpring
(formerly AMA, LLC) minority
shares - - 1,278 1,278
Intangible assets obtained
from sale upon merger of
Lighthouse Partners, net(1) - - 24,142 24,142
Sale/securitization of MSRs - (115,656) - (115,656)
Balance June 30, 2007 $205,574 $942,012 $142,874 $1,290,460
Balance, beginning of period $172,655 $1,049,425 $140,915 $1,362,995
Amortization (29,180) (113,077) (11,269) (153,526)
MSRs originated - 298,278 - 298,278
MSRs impairment reserve - (1,881) - (1,881)
MSRs impairment recovery - 1,881 - 1,881
Sale of interest in Lighthouse
Partners - - (5,992) (5,992)
Sale/securitization of MSRs - (41,176) - (41,176)
Customer intangible impairment
charge - - (45,000) (45,000)
Acquisition of GB&T 29,510 - - 29,510
Sale of First Mercantile - - (3,033) (3,033)
Balance June 30, 2008 $172,985 $1,193,450 $75,621 $1,442,056
Three Months Ended
June 30 March 31 December 31 September 30 June 30
2008 2008 2007 2007 2007
COMMON SHARE ROLLFORWARD
Beginning balance 349,832 348,411 348,074 349,053 356,505
Common shares
issued/exchanged for
employee benefit plans,
stock option,
performance and
restricted stock
activity 1,489 1,421 337 483 1,228
Common shares issued for
acquisition of GB&T 2,221 - - - -
Acquisition of treasury
stock - - - (1,462) (8,680)
Ending balance 353,542 349,832 348,411 348,074 349,053
COMMON STOCK REPURCHASE
ACTIVITY
Number of common shares
repurchased (2) 19 17 12 1,472 8,715
Average price per share of
repurchased common shares $57.76 $62.38 $69.31 $81.00 $87.02
Total cost to acquire
treasury shares $- $- $- $- $853,386
Maximum number of common
shares that may yet be
purchased under plans or
programs (3) 30,000 30,000 30,000 30,000 2,471
(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. During 2007, the Company entered into a second
ASR, as announced in the Company's 8-K filing on June 7, 2007, by
repurchasing 8,022,254 shares during the second quarter of 2007. This
ASR was completed in the third quarter of 2007 when the Company
received, without additional payment, an additional 1,462,091 shares.
On August 14, 2007, the Board of Directors authorized the Company to
repurchase up to 30 million shares of common stock and specified that
such authorization replaced (terminated) existing unused
authorizations.
SunTrust Banks, Inc. and Subsidiaries
RECONCILEMENT OF NON-GAAP MEASURES
APPENDIX A TO THE EARNINGS RELEASE
(Dollars in thousands) (Unaudited)
Three Months Ended
June 30 March 31
2008 2008
NON-GAAP MEASURES PRESENTED IN THE
EARNINGS RELEASE
Net income $540,362 $290,555
Securities (gains)/losses, net of tax (345,807) 37,563
Net income excluding net securities
(gains)/ losses, net of tax 194,555 328,118
The Coca-Cola Company dividend, net
of tax (14,738) (14,738)
Net income/(loss) excluding net
securities
(gains)/losses and The Coca-Cola
Company dividend 179,817 313,380
Preferred dividends 5,112 6,977
Net income/(loss) available to common
shareholders excluding net securities
(gains)/losses and The Coca-Cola
Company dividend $174,705 $306,403
Total average assets $175,548,768 $176,916,901
Average net unrealized securities gains (2,295,932) (2,453,981)
Average assets less net unrealized
securities gains $173,252,836 $174,462,920
Total average common shareholders' equity $17,593,229 $17,561,709
Average accumulated other comprehensive
income (1,488,305) (1,533,427)
Total average realized common
shareholders' equity $16,104,924 $16,028,282
Return on average total assets 1.24% 0.66%
Impact of excluding net realized and
unrealized securities (gains)/losses
and The Coca-Cola Company dividend (0.82) 0.06
Return on average total assets less
net unrealized securities gains (1) 0.42% 0.72%
Return on average common shareholders'
equity 12.24% 6.49%
Impact of excluding net realized and
unrealized securities (gains)/losses
and The Coca-Cola Company dividend (7.88) 1.20
Return on average realized common
shareholders' equity (2) 4.36% 7.69%
Efficiency ratio (3) 53.06% 56.40%
Impact of excluding amortization/impairment
of intangible assets other than MSRs (2.49) (0.93)
Tangible efficiency ratio (4) 50.57% 55.47%
Total shareholders' equity $17,907,152 $18,431,448
Goodwill (7,056,015) (6,923,033)
Other intangible assets including MSRs (1,442,056) (1,430,268)
MSRs 1,193,450 1,143,405
Tangible equity $10,602,531 $11,221,552
Total assets $177,413,501 $178,986,947
Goodwill (7,056,015) (6,923,033)
Other intangible assets including MSRs (1,442,056) (1,430,268)
MSRs 1,193,450 1,143,405
Tangible assets $170,108,880 $171,777,051
Tangible equity to tangible assets (5) 6.23% 6.53%
Net interest income $1,156,716 $1,139,867
Taxable-equivalent adjustment 28,256 27,975
Net interest income - FTE 1,184,972 1,167,842
Noninterest income 1,413,010 1,057,502
Total revenue - FTE 2,597,982 2,225,344.00
Securities (gains)/losses, net (549,787) 60,586
Total revenue - FTE excluding
securities (gains)/losses, net (6) $2,048,195 $2,285,930
CALCULATION OF PRO FORMA TIER 1 As of
CAPITAL June 30, 2008
Estimated Tier 1 Capital $12,521,872
Impact of July 15, 2008 Tier 1 Coca-Cola
Company Agreements 727,924
Impact of July charitable gift to
SunTrust Foundation 68,527
Pro forma Tier 1 Capital $13,318,323
Three Months Ended
December 31 September 30 June 30
2007 2007 2007
NON-GAAP MEASURES
PRESENTED IN THE EARNINGS
RELEASE
Net income $11,124 $420,164 $681,431
Securities (gains)/losses, net
of tax (3,530) (614) (146,575)
Net income excluding net
securities (gains)/losses, net
of tax 7,594 419,550 534,856
The Coca-Cola Company dividend,
net of tax (13,206) (13,210) (13,218)
Net income/(loss) excluding net
securities (gains)/losses and
The Coca-Cola Company dividend (5,612) 406,340 521,638
Preferred dividends 7,867 7,526 7,519
Net income/(loss) available to
common shareholders excluding
net securities (gains)/losses
and The Coca-Cola Company
dividend ($13,479) $398,814 $514,119
Total average assets $175,130,464 $174,653,377 $179,996,457
Average net unrealized
securities gains (2,408,596) (2,091,892) (2,398,651)
Average assets less net
unrealized securities gains $172,721,868 $172,561,485 $177,597,806
Total average common
shareholders' equity $17,532,786 $17,050,182 $17,428,101
Average accumulated other
comprehensive income (1,292,785) (998,561) (1,206,487)
Total average realized common
shareholders' equity $16,240,001 $16,051,621 $16,221,614
Return on average total assets 0.03% 0.95% 1.52%
Impact of excluding net realized
and unrealized securities (gains)
/losses and The Coca-Cola Company
dividend (0.04) (0.02) (0.34)
Return on average total assets
less net unrealized securities
gains (1) (0.01)% 0.93% 1.18%
Return on average common
shareholders' equity 0.07% 9.60% 15.51%
Impact of excluding net realized
and unrealized securities (gains)/
losses and The Coca-Cola Company
dividend (0.40) 0.26 (2.80)
Return on average realized common
shareholders' equity (2) (0.33)% 9.86% 12.71%
Efficiency ratio (3) 82.19% 63.35% 52.69%
Impact of excluding amortization/
impairment of intangible assets
other than MSRs (1.33) (1.22) (1.05)
Tangible efficiency ratio (4) 80.86% 62.13% 51.64%
Total shareholders' equity $18,052,518 $17,907,247 $17,368,853
Goodwill (6,921,493) (6,912,110) (6,897,050)
Other intangible assets
including MSRs (1,362,995) (1,327,060) (1,290,460)
MSRs 1,049,426 995,984 942,012
Tangible equity $10,817,456 $10,664,061 $10,123,355
Total assets $179,573,933 $175,857,229 $180,314,372
Goodwill (6,921,493) (6,912,110) (6,897,050)
Other intangible assets
including MSRs (1,362,995) (1,327,060) (1,290,460)
MSRs 1,049,426 995,984 942,012
Tangible assets $172,338,871 $168,614,043 $173,068,874
Tangible equity to
tangible assets (5) 6.28% 6.32% 5.85%
Net interest income $1,167,513 $1,192,188 $1,195,284
Taxable-equivalent adjustment 27,244 27,055 24,668
Net interest income - FTE 1,194,757 1,219,243 1,219,952
Noninterest income 576,017 819,139 1,154,622
Total revenue - FTE 1,770,774.00 2,038,382.00 2,374,574.00
Securities (gains)/losses,
net (5,694) (991) (236,412)
Total revenue - FTE
excluding securities
(gains)/losses, net (6) $1,765,080 $2,037,391 $2,138,162
CALCULATION OF PRO FORMA
TIER 1 CAPITAL
Estimated Tier 1 Capital
Impact of July 15, 2008
Tier 1 Coca-Cola Company
Agreements
Impact of July charitable
gift to SunTrust
Foundation
Pro forma Tier 1 Capital
Six Months Ended
June 30 June 30
2008 2007
NON-GAAP MEASURES PRESENTED IN THE
EARNINGS RELEASE
Net income $830,917 $1,202,727
Securities (gains)/losses, net of tax (308,244) (146,588)
Net income excluding net securities (gains)
/losses, net of tax 522,673 1,056,139
The Coca-Cola Company dividend, net of tax (29,477) (27,798)
Net income/(loss) excluding net securities
(gains)/losses and The Coca-Cola Company
dividend 493,196 1,028,341
Preferred dividends 12,089 14,882
Net income/(loss) available to common
shareholders excluding net securities
(gains)/losses and The Coca-Cola Company
dividend $481,107 $1,013,459
Total average assets $176,232,836 $180,747,241
Average net unrealized securities gains (2,374,957) (2,352,236)
Average assets less net unrealized
securities gains $173,857,879 $178,395,005
Total average common shareholders' equity 17,577,470 $17,324,815
Average accumulated other comprehensive
income (1,510,866) (1,140,856)
Total average realized common shareholders'
equity $16,066,604 $16,183,959
Return on average total assets 0.95% 1.34%
Impact of excluding net realized and
unrealized securities (gains)/losses and
The Coca-Cola Company dividend (0.38) (0.18)
Return on average total assets less
net unrealized securities gains (1) 0.57% 1.16%
Return on average common shareholders'
equity 9.37% 13.83%
Impact of excluding net realized and
unrealized securities (gains)/losses and
The Coca-Cola Company dividend (3.35) (1.20)
Return on average realized common
shareholders' equity (2) 6.02% 12.63%
Efficiency ratio (3) 54.60% 56.00%
Impact of excluding amortization/impairment
of intangible assets other than MSRs (1.77) (1.09)
Tangible efficiency ratio (4) 52.83% 54.91%
Total shareholders' equity
Goodwill
Other intangible assets including MSRs
MSRs
Tangible equity
Total assets
Goodwill
Other intangible assets including MSRs
MSRs
Tangible assets
Tangible equity to tangible assets (5)
Net interest income $2,296,583 $2,359,843
Taxable-equivalent adjustment 56,231 48,381
Net interest income - FTE 2,352,814 2,408,224
Noninterest income 2,470,512 2,033,528
Total revenue - FTE 4,823,326.00 4,441,752.00
Securities (gains)/losses, net (489,201) (236,432)
Total revenue - FTE excluding securities
(gains)/losses, net (6) $4,334,125 $4,205,320
CALCULATION OF PRO FORMA TIER 1
CAPITAL
Estimated Tier 1 Capital
Impact of July 15, 2008 Tier 1 Coca-
Cola Company Agreements
Impact of July charitable gift to
SunTrust Foundation
Pro forma Tier 1 Capital
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 securities portfolio which includes the
ownership by the Company of 33.6 million shares of The Coca-Cola
Company as of June 30, 2008. 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, net of tax, 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 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, net of tax, 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
amortization/impairment of intangible assets other than MSRs. The
Company believes this measure is useful to investors because, by
removing the effect of these 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 securities
(gains)/losses, net. The Company believes noninterest income 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 and is more indicative of
normalized operations.
SunTrust Banks, Inc. and Subsidiaries
QUARTER-TO-QUARTER COMPARISON - ACTUAL
APPENDIX B TO THE EARNINGS RELEASE
(Dollars in thousands) (Unaudited)
Three Months Ended
Sequential
Increase/ Annualized
June 30 March 31 (Decrease)(2) (1,2)
2008 2008 Amount % %
STATEMENTS OF INCOME
NET INTEREST INCOME $1,156,716 $1,139,867 $16,849 1.5% 5.9%
Provision for loan
losses 448,027 560,022 (111,995) (20.0) (80.0)
NET INTEREST INCOME
AFTER PROVISION
FOR LOAN LOSSES 708,689 579,845 128,844 22.2 88.9
NONINTEREST INCOME
Service charges on
deposit accounts 230,296 211,839 18,457 8.7 34.9
Trust and investment
management income 157,319 161,102 (3,783) (2.3) (9.4)
Retail investment
services 73,764 72,300 1,464 2.0 8.1
Other charges and fees 129,581 127,231 2,350 1.8 7.4
Investment banking
income 60,987 55,420 5,567 10.0 40.2
Trading account
profits/(losses) and
commissions (49,306) 28,218 (77,524) NM NM
Card fees 78,566 73,761 4,805 6.5 26.1
Mortgage production
related income 63,508 85,549 (22,041) (25.8) NM
Mortgage servicing
related income 32,548 29,098 3,450 11.9 47.4
Net gain on sale/
leaseback of premises - 37,039 (37,039) (100.0) NM
Net gain on sale or
merger of Lighthouse
interests - 89,390 (89,390) (100.0) NM
Gain on Visa IPO - 86,305 (86,305) (100.0) NM
Gain on sale of First
Mercantile 29,648 - 29,648 NM -
Other noninterest
income 56,312 60,836 (4,524) (7.4) (29.7)
Securities gains/
(losses), net 549,787 (60,586) 610,373 NM NM
Total noninterest
income 1,413,010 1,057,502 355,508 33.6 NM
NONINTEREST EXPENSE
Employee compensation
and benefits 711,957 715,083 (3,126) (0.4) (1.7)
Net occupancy expense 85,483 86,441 (958) (1.1) (4.4)
Outside processing and
software 107,205 109,165 (1,960) (1.8) (7.2)
Equipment expense 50,991 52,395 (1,404) (2.7) (10.7)
Marketing and customer
development 47,203 55,703 (8,500) (15.3) (61.0)
Amortization/impairment
of intangible assets 64,735 20,715 44,020 NM NM
Net loss on
extinguishment of
debt - 11,723 (11,723) (100.0) NM
Visa litigation - (39,124) 39,124 100.0 NM
Other noninterest
expense 310,959 243,043 67,916 27.9 NM
Total noninterest
expense 1,378,533 1,255,144 123,389 9.8 39.3
INCOME BEFORE
PROVISION FOR INCOME
TAXES 743,166 382,203 360,963 94.4 NM
Provision for income
taxes 202,804 91,648 111,156 NM NM
NET INCOME 540,362 290,555 249,807 86.0 NM
Preferred dividends 5,112 6,977 (1,865) (26.7) NM
NET INCOME AVAILABLE
TO COMMON SHAREHOLDERS $535,250 $283,578 $251,672 88.7 NM
REVENUE
Net interest income $1,156,716 $1,139,867 $16,849 1.5% 5.9%
Taxable-equivalent
adjustment 28,256 27,975 281 1.0 4.0
Net interest income -
FTE 1,184,972 1,167,842 17,130 1.5 5.9
Noninterest income 1,413,010 1,057,502 355,508 33.6 NM
Total revenue - FTE 2,597,982 2,225,344 372,638 16.7 67.0
SELECTED AVERAGE
BALANCES (Dollars in
millions)
Average loans
Commercial-FTE $37,600 $36,375 $1,225 3.4% 13.5%
Real estate home
equity lines 14,980 14,603 377 2.6 10.3
Real estate construction 11,472 12,450 (978) (7.9) (31.4)
Real estate 1-4 family 32,114 32,440 (326) (1.0) (4.0)
Real estate commercial 13,877 13,113 764 5.8 23.3
Credit card 816 774 42 5.4 21.5
Consumer - direct 4,382 4,063 319 7.9 31.4
Consumer - indirect 7,437 7,646 (209) (2.7) (10.9)
Nonaccrual and
restructured 2,514 1,799 715 39.8 NM
Total loans $125,192 $123,263 $1,929 1.6% 6.3%
Average deposits
Noninterest bearing
deposits $21,346 $20,616 $730 3.5% 14.2%
NOW accounts 21,762 21,981 (219) (1.0) (4.0)
Money market accounts 26,032 25,343 689 2.7 10.9
Savings 3,939 3,917 22 0.6 2.3
Consumer and other time 28,648 29,311 (663) (2.3) (9.1)
Total consumer and
commercial deposits 101,727 101,168 559 0.6 2.2
Brokered and foreign
deposits 15,068 15,469 (401) (2.6) (10.4)
Total deposits $116,795 $116,637 $158 0.1% 0.5%
SELECTED CREDIT DATA
(Dollars in
thousands)
Nonaccrual loans $2,625,328 $2,037,960 $587,368 28.8% NM%
Restructured loans 163,358 30,787 132,571 NM NM
Total nonperforming
loans 2,788,686 2,068,747 719,939 34.8 NM
Other real estate
owned (OREO) 335,747 244,906 90,840 37.1 NM
Other repossessed
assets 13,203 6,340 6,863 NM NM
Total nonperforming
assets $3,137,636 $2,319,993 $817,643 35.2% NM%
Allowance for loan and
lease losses $1,829,400 $1,545,340 $284,060 18.4% 73.5%
Increase/
June 30 June 30 (Decrease)(2)
2008 2007 Amount %
STATEMENTS OF INCOME
NET INTEREST INCOME $1,156,716 $1,195,284 ($38,568) (3.2)%
Provision for loan losses 448,027 104,680 343,347 NM
NET INTEREST INCOME AFTER
PROVISION
FOR LOAN LOSSES 708,689 1,090,604 (381,915) (35.0)
NONINTEREST INCOME
Service charges on deposit
accounts 230,296 196,844 33,452 17.0
Trust and investment
management income 157,319 164,620 (7,301) (4.4)
Retail investment services 73,764 71,785 1,979 2.8
Other charges and fees 129,581 118,358 11,223 9.5
Investment banking income 60,987 61,999 (1,012) (1.6)
Trading account profits/
(losses) and commissions (49,306) 16,437 (65,743) NM
Card fees 78,566 68,580 9,986 14.6
Mortgage production related
income 63,508 64,322 (814) (1.3)
Mortgage servicing related
income 32,548 45,527 (12,979) (28.5)
Net gain on sale/leaseback of
premises - - - NM
Net gain on sale or merger of
Lighthouse interests - - - NM
Gain on Visa IPO - - - NM
Gain on sale of First
Mercantile 29,648 - 29,648 NM
Other noninterest income 56,312 109,738 (53,426) (48.7)
Securities gains/(losses), net 549,787 236,412 313,375 NM
Total noninterest income 1,413,010 1,154,622 258,388 22.4
NONINTEREST EXPENSE
Employee compensation and
benefits 711,957 710,613 1,344 0.2
Net occupancy expense 85,483 84,650 833 1.0
Outside processing and software 107,205 100,730 6,475 6.4
Equipment expense 50,991 53,823 (2,832) (5.3)
Marketing and customer
development 47,203 43,326 3,877 8.9
Amortization/impairment of
intangible assets 64,735 24,904 39,831 NM
Net loss on extinguishment of
debt - - - NM
Visa litigation - - - NM
Other noninterest expense 310,959 233,148 77,811 33.4
Total noninterest expense 1,378,533 1,251,194 127,339 10.2
INCOME BEFORE PROVISION FOR
INCOME TAXES 743,166 994,032 (250,866) (25.2)
Provision for income taxes 202,804 312,601 (109,797) (35.1)
NET INCOME 540,362 681,431 (141,069) (20.7)
Preferred dividends 5,112 7,519 (2,407) (32.0)
NET INCOME AVAILABLE TO
COMMON SHAREHOLDERS $535,250 $673,912 ($138,662) (20.6)
REVENUE
Net interest income $1,156,716 $1,195,284 ($38,568) (3.2)%
Taxable-equivalent adjustment 28,256 24,668 3,588 14.5
Net interest income - FTE 1,184,972 1,219,952 (34,980) (2.9)
Noninterest income 1,413,010 1,154,622 258,388 22.4
Total revenue - FTE 2,597,982 2,374,574 223,408 9.4
SELECTED AVERAGE BALANCES
(Dollars in millions)
Average loans
Commercial-FTE $37,600 $33,608 $3,992 11.9%
Real estate home equity lines 14,980 13,850 1,130 8.2
Real estate construction 11,472 13,710 (2,238) (16.3)
Real estate 1-4 family 32,114 30,754 1,360 4.4
Real estate commercial 13,877 12,732 1,145 9.0
Credit card 816 404 412 NM
Consumer - direct 4,382 4,347 35 0.8
Consumer - indirect 7,437 8,064 (627) (7.8)
Nonaccrual and restructured 2,514 696 1,818 NM
Total loans $125,192 $118,165 $7,027 5.9%
Average deposits
Noninterest bearing deposits $21,346 $22,396 ($1,050) (4.7)%
NOW accounts 21,762 20,066 1,696 8.5
Money market accounts 26,032 21,773 4,259 19.6
Savings 3,939 4,787 (848) (17.7)
Consumer and other time 28,648 28,905 (257) (0.9)
Total consumer and
commercial deposits 101,727 97,927 3,800 3.9
Brokered and foreign deposits 15,068 23,983 (8,915) (37.2)
Total deposits $116,795 $121,910 ($5,115) (4.2)%
SELECTED CREDIT DATA (Dollars
in thousands)
Nonaccrual loans $2,625,328 $736,800 $1,888,528 NM%
Restructured loans 163,358 27,816 135,542 NM
Total nonperforming loans 2,788,686 764,616 2,024,070 NM
Other real estate owned
(OREO) 335,747 100,973 234,774 NM
Other repossessed assets 13,203 7,250 5,953 82.1
Total nonperforming assets $3,137,636 $872,839 $2,264,796 NM%
Allowance for loan and lease
losses $1,829,400 $1,050,362 $779,038 74.2%
1) Multiply percentage change by 4 to calculate sequential annualized
change.
2) "NM" - Not meaningful. Those changes over 100 percent were not
considered to be meaningful.
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 June 30 Increase/(Decrease)
2008 2007 Amount %(1)
STATEMENTS OF INCOME
NET INTEREST INCOME $2,296,583 $2,359,843 ($63,260) (2.7)%
Provision for loan losses 1,008,049 161,121 846,928 NM
NET INTEREST INCOME AFTER
PROVISION FOR LOAN LOSSES 1,288,534 2,198,722 (910,188) (41.4)
NONINTEREST INCOME
Service charges on deposit
accounts 442,135 385,879 56,256 14.6
Trust and investment
management income 318,421 338,938 (20,517) (6.1)
Retail investment services 146,064 135,328 10,736 7.9
Other charges and fees 256,812 236,495 20,317 8.6
Investment banking income 116,407 112,156 4,251 3.8
Trading account profits/
(losses) and commissions (21,088) 106,638 (127,726) NM
Card fees 152,327 132,775 19,552 14.7
Mortgage production related
income 149,057 55,667 93,390 NM
Mortgage servicing related
income 61,646 80,930 (19,284) (23.8)
Gain on sale or merger of
Lighthouse interests 89,390 32,340 57,050 NM
Gain on Visa IPO 86,305 - 86,305 NM
Gain of sale of First
Mercantile 29,648 - 29,648 NM
Net gain on sale/leaseback of
premises 37,039 - 37,039 NM
Other noninterest income 117,148 179,950 (62,802) (34.9)
Net securities gains/(losses) 489,201 236,432 252,769 NM
Total noninterest income 2,470,512 2,033,528 436,984 21.5
NONINTEREST EXPENSE
Employee compensation and
benefits 1,427,040 1,409,613 17,427 1.2
Net occupancy expense 171,924 170,907 1,017 0.6
Outside processing and
software 216,370 200,406 15,964 8.0
Equipment expense 103,386 103,232 154 0.1
Marketing and customer
development 102,906 89,031 13,875 15.6
Amortization/impairment of
intangible assets 85,450 48,446 37,004 76.4
Loss on extinguishment of debt 11,723 - 11,723 NM
VISA litigation (39,124) - (39,124) NM
Other noninterest expense 554,002 465,556 88,446 19.0
Total noninterest expense 2,633,677 2,487,191 146,486 5.9
INCOME BEFORE PROVISION FOR
INCOME TAXES 1,125,369 1,745,059 (619,690) (35.5)
Provision for income taxes 294,452 542,332 (247,880) (45.7)
NET INCOME 830,917 1,202,727 (371,810) (30.9)
Preferred dividends 12,089 14,882 (2,793) (18.8)
NET INCOME AVAILABLE TO COMMON
SHAREHOLDERS $818,828 $1,187,845 ($369,017) (31.1)
REVENUE
Net interest income $2,296,583 $2,359,843 ($63,260) (2.7)%
Taxable-equivalent adjustment 56,231 48,381 7,850 16.2
Net interest income - FTE 2,352,814 2,408,224 (55,410) (2.3)
Noninterest income 2,470,512 2,033,528 436,984 21.5
Total revenue - FTE $4,823,326 $4,441,752 $381,574 8.6
SELECTED AVERAGE BALANCES
(Dollars in millions)
Average loans
Commercial-FTE $36,987 $33,819 $3,168 9.4 %
Real estate home equity lines 14,792 13,794 998 7.2
Real estate construction 11,961 13,571 (1,610) (11.9)
Real estate 1-4 family 32,277 32,413 (136) (0.4)
Real estate commercial 13,495 12,781 714 5.6
Credit card 795 387 408 NM
Consumer - direct 4,223 4,284 (61) (1.4)
Consumer - indirect 7,541 8,115 (574) (7.1)
Nonaccrual and restructured 2,156 667 1,489 NM
Total loans $124,227 $119,831 $4,396 3.7 %
Average deposits
Noninterest bearing deposits $20,981 $22,166 ($1,185) (5.3)%
NOW accounts 21,872 19,944 1,928 9.7
Money market accounts 25,687 21,930 3,757 17.1
Savings 3,928 4,905 (977) (19.9)
Consumer and other time 28,980 28,915 65 0.2
Total consumer and
commercial deposits 101,448 97,860 3,588 3.7
Brokered and foreign deposits 15,268 25,341 (10,073) (39.7)
Total deposits $116,716 $123,201 ($6,485) (5.3)%
(1) "NM" - Not meaningful. Those changes over 100 percent were not
considered to be meaningful.
SunTrust Banks, Inc. and Subsidiaries
RETAIL AND COMMERCIAL LINE OF BUSINESS
(Dollars in thousands) (Unaudited)
Three Months Ended
June 30 June 30 %
2008 2007 Change(3)
Statements of Income
Net interest income(1) $642,474 $707,200 (9.2)%
FTE adjustment 8,501 9,311 (8.7)
Net interest income - FTE 650,975 716,511 (9.1)
Provision for loan losses(2) 182,607 56,688 NM
Net interest income after provision
for loan losses - FTE 468,368 659,823 (29.0)
Noninterest income before
securities gains/(losses) 345,051 301,239 14.5
Securities gains/(losses), net - - -
Total noninterest income 345,051 301,239 14.5
Noninterest expense before
amortization of intangible assets 628,203 631,498 (0.5)
Amortization of intangible assets 14,218 17,245 (17.6)
Total noninterest expense 642,421 648,743 (1.0)
Income before provision for income
taxes 170,998 312,319 (45.2)
Provision for income taxes 51,805 103,461 (49.9)
FTE adjustment 8,501 9,311 (8.7)
Net income $110,692 $199,547 (44.5)
Total revenue - FTE $996,026 $1,017,750 (2.1)
Selected Average Balances
Total loans $51,396,999 $51,467,349 (0.1)%
Goodwill 6,139,892 6,139,260 -
Other intangible assets excluding
MSRs 161,459 211,917 (23.8)
Total assets 59,161,979 58,994,607 0.3
Total deposits 81,174,182 80,574,355 0.7
Performance Ratios
Efficiency ratio 64.50 % 63.74 %
Impact of excluding amortization of
intangible assets (5.67) (5.63)
Tangible efficiency ratio 58.83 % 58.11 %
Six Months Ended
June 30 June 30 %
2008 2007 Change(3)
Statements of Income
Net interest income(1) $1,262,592 $1,410,714 (10.5)%
FTE adjustment 17,233 18,760 (8.1)
Net interest income - FTE 1,279,825 1,429,474 (10.5)
Provision for loan losses(2) 363,349 105,382 NM
Net interest income after
provision for loan losses - FTE 916,476 1,324,092 (30.8)
Noninterest income before
securities gains/(losses) 669,012 597,563 12.0
Securities gains/(losses), net - 3 (100.0)
Total noninterest income 669,012 597,566 12.0
Noninterest expense before
amortization of intangible assets 1,241,367 1,256,558 (1.2)
Amortization of intangible assets 29,159 36,017 (19.0)
Total noninterest expense 1,270,526 1,292,575 (1.7)
Income before provision for income
taxes 314,962 629,083 (49.9)
Provision for income taxes 93,488 208,992 (55.3)
FTE adjustment 17,233 18,760 (8.1)
Net income $204,241 $401,331 (49.1)
Total revenue - FTE $1,948,837 $2,027,040 (3.9)
Selected Average Balances
Total loans $50,891,138 $51,224,362 (0.7)%
Goodwill 6,142,224 6,136,539 0.1
Other intangible assets excluding
MSRs 163,579 221,153 (26.0)
Total assets 58,701,307 58,896,038 (0.3)
Total deposits 80,975,187 80,824,425 0.2
Performance Ratios
Efficiency ratio 65.19% 63.77%
Impact of excluding amortization
of intangible assets (5.83) (5.71)
Tangible efficiency ratio 59.36% 58.06%
(1) Net interest income does not include the funding benefit that would
result from holding shareholders' equity at the line of business level
due to the fact that shareholders' equity is not allocated to the
lines of business at this time.
(2) Provision for loan losses represents net charge-offs for the lines of
business.
(3) "NM" - Not meaningful. Those changes over 100 percent were not
considered to be meaningful.
SunTrust Banks, Inc. and Subsidiaries
WHOLESALE BANKING LINE OF BUSINESS
(Dollars in thousands) (Unaudited)
Three Months Ended
June 30 June 30 %
2008 2007 Change(3)
Statements of Income
Net interest income(1) $116,384 $135,679 (14.2)%
FTE adjustment 15,259 11,078 37.7
Net interest income - FTE 131,643 146,757 (10.3)
Provision for loan losses(2) 10,981 15,587 (29.6)
Net interest income after provision
for loan losses - FTE 120,662 131,170 (8.0)
Noninterest income before
securities gains/(losses) 184,732 225,602 (18.1)
Securities gains/(losses), net - - -
Total noninterest income 184,732 225,602 (18.1)
Noninterest expense before
amortization of intangible assets 200,550 195,636 2.5
Amortization of intangible assets 122 122 -
Total noninterest expense 200,672 195,758 2.5
Income before provision for income
taxes 104,722 161,014 (35.0)
Provision for income taxes 14,617 31,227 (53.2)
FTE adjustment 15,259 11,078 37.7
Net income $74,846 $118,709 (37.0)
Total revenue - FTE $316,375 $372,359 (15.0)
Selected Average Balances
Total loans $33,753,195 $28,820,686 17.1 %
Goodwill 168,129 168,149 -
Other intangible assets excluding
MSRs 681 1,157 (41.1)
Total assets 44,737,435 38,291,705 16.8
Total deposits 9,093,065 4,703,473 93.3
Performance Ratios
Efficiency ratio 63.43 % 52.57 %
Impact of excluding amortization of
intangible assets (0.42) (0.29)
Tangible efficiency ratio 63.01 % 52.28 %
Six Months Ended
June 30 June 30 %
2008 2007 Change(3)
Statements of Income
Net interest income(1) $242,175 $269,688 (10.2)%
FTE adjustment 29,350 21,142 38.8
Net interest income - FTE 271,525 290,830 (6.6)
Provision for loan losses(2) 23,257 18,395 26.4
Net interest income after provision
for loan losses - FTE 248,268 272,435 (8.9)
Noninterest income before
securities gains/(losses) 358,254 394,287 (9.1)
Securities gains/(losses), net - - -
Total noninterest income 358,254 394,287 (9.1)
Noninterest expense before
amortization of intangible assets 400,976 386,607 3.7
Amortization of intangible assets 244 244 -
Total noninterest expense 401,220 386,851 3.7
Income before provision for income
taxes 205,302 279,871 (26.6)
Provision for income taxes 14,080 47,378 (70.3)
FTE adjustment 29,350 21,142 38.8
Net income $161,872 $211,351 (23.4)
Total revenue - FTE $629,779 $685,117 (8.1)
Selected Average Balances
Total loans $33,223,407 $29,201,194 13.8 %
Goodwill 168,132 168,149 -
Other intangible assets excluding
MSRs 741 1,221 (39.3)
Total assets 44,170,590 38,280,872 15.4
Total deposits 8,786,705 4,719,650 86.2
Performance Ratios
Efficiency ratio 63.71 % 56.46 %
Impact of excluding amortization of
intangible assets (0.42) (0.33)
Tangible efficiency ratio 63.29 % 56.13 %
(1) Net interest income does not include the funding benefit that would
result from holding shareholders' equity at the line of business level
due to the fact that shareholders' equity is not allocated to the
lines of business at this time.
(2) Provision for loan losses represents net charge-offs for the lines of
business.
(3) "NM" - Not meaningful. Those changes over 100 percent were not
considered to be meaningful.
SunTrust Banks, Inc. and Subsidiaries
MORTGAGE LINE OF BUSINESS
(Dollars in thousands) (Unaudited)
Three Months Ended
June 30 June 30 %
2008 2007 Change(3)
Statements of Income
Net interest income(1) $123,646 $134,382 (8.0)%
FTE adjustment - - -
Net interest income - FTE 123,646 134,382 (8.0)
Provision for loan losses(2) 128,008 13,051 NM
Net interest income/(loss) after
provision for loan losses - FTE (4,362) 121,331 NM
Noninterest income before
securities gains/(losses) 109,873 136,932 (19.8)
Securities gains/(losses), net (1,218) - -
Total noninterest income 108,655 136,932 (20.7)
Noninterest expense before
amortization of intangible
assets 256,231 196,410 30.5
Amortization of intangible assets 563 763 (26.2)
Total noninterest expense 256,794 197,173 30.2
Income/(loss) before
provision/(benefit) for income
taxes (152,501) 61,090 NM
Provision/(benefit) for income
taxes (61,377) 19,613 NM
FTE adjustment - - -
Net income/(loss) ($91,124) $41,477 NM
Total revenue - FTE $232,301 $271,314 (14.4)
Selected Average Balances
Total loans $31,705,811 $29,447,549 7.7 %
Goodwill 276,568 276,635 -
Other intangible assets excluding
MSRs 570 3,503 (83.7)
Total assets 42,307,385 47,866,726 (11.6)
Total deposits 2,449,481 2,378,640 3.0
Performance Ratios
Efficiency ratio 110.54 % 72.67 %
Impact of excluding amortization
of intangible assets (1.72) (1.08)
Tangible efficiency ratio 108.82 % 71.59 %
Other Information
Production Data
Channel mix
Retail $4,752,866 $6,767,535 (29.8)%
Wholesale 3,226,782 6,447,113 (49.9)
Correspondent 1,357,553 4,745,579 (71.4)
Total production $9,337,201 $17,960,227 (48.0)
Channel mix - percent
Retail 51 % 38 %
Wholesale 35 36
Correspondent 14 26
Total production 100 % 100 %
Purchase and refinance mix
Refinance $4,063,567 $7,721,183 (47.4)
Purchase 5,273,634 10,239,044 (48.5)
Total production $9,337,201 $17,960,227 (48.0)
Purchase and refinance mix -
percent
Refinance 44 % 43 %
Purchase 56 57
Total production 100 % 100 %
Applications $16,134,572 $24,369,784 (33.8)
Mortgage Servicing Data (End of
Period)
Total loans serviced $158,810,627 $150,456,415 5.6 %
Total loans serviced for others 123,152,250 105,123,313 17.2
Net carrying value of MSRs 1,193,450 942,012 26.7
Ratio of net carrying value of
MSRs to total loans serviced
for others 0.969 % 0.896 %
Six Months Ended
June 30 June 30 %
2008 2007 Change(3)
Statements of Income
Net interest income(1) $254,276 $263,974 (3.7)%
FTE adjustment - - -
Net interest income - FTE 254,276 263,974 (3.7)
Provision for loan losses(2) 226,263 23,260 NM
Net interest income/(loss) after
provision for loan losses - FTE 28,013 240,714 (88.4)
Noninterest income before
securities gains/(losses) 247,003 175,415 40.8
Securities gains/(losses), net (6,228) - -
Total noninterest income 240,775 175,415 37.3
Noninterest expense before
amortization of intangible assets 475,758 347,973 36.7
Amortization of intangible assets 1,327 1,527 (13.1)
Total noninterest expense 477,085 349,500 36.5
Income/(loss) before
provision/(benefit) for income
taxes (208,297) 66,629 NM
Provision/(benefit) for income
taxes (85,903) 18,259 NM
FTE adjustment - - -
Net income/(loss) ($122,394) $48,370 NM
Total revenue - FTE $495,051 $439,389 12.7
Selected Average Balances
Total loans $31,851,320 $30,906,163 3.1 %
Goodwill 276,575 276,310 0.1
Other intangible assets excluding
MSRs 922 3,901 (76.4)
Total assets 43,098,260 46,076,712 (6.5)
Total deposits 2,259,889 2,086,942 8.3
Performance Ratios
Efficiency ratio 96.37 % 79.54 %
Impact of excluding amortization of
intangible assets (1.47) (1.42)
Tangible efficiency ratio 94.90 % 78.12 %
Other Information
Production Data
Channel mix
Retail $10,110,273 $12,687,187 (20.3)%
Wholesale 7,431,405 12,019,225 (38.2)
Correspondent 3,527,155 8,080,169 (56.3)
Total production $21,068,833 $32,786,581 (35.7)
Channel mix - percent
Retail 48 % 39 %
Wholesale 35 37
Correspondent 17 24
Total production 100 % 100 %
Purchase and refinance mix
Refinance $10,778,853 $15,287,725 (29.5)
Purchase 10,289,980 17,498,856 (41.2)
Total production $21,068,833 $32,786,581 (35.7)
Purchase and refinance mix -
percent
Refinance 51 % 47 %
Purchase 49 53
Total production 100 % 100 %
Applications $37,344,012 $48,868,769 (23.6)
Mortgage Servicing Data (End of
Period)
Total loans serviced
Total loans serviced for others
Net carrying value of MSRs
Ratio of net carrying value of MSRs
to total loans serviced for others
(1) Net interest income does not include the funding benefit that would
result from holding shareholders' equity at the line of business level
due to the fact that shareholders' equity is not allocated to the
lines of business at this time.
(2) Provision for loan losses represents net charge-offs for the lines of
business.
(3) "NM" - Not meaningful. Those changes over 100 percent were not
considered to be meaningful.
SunTrust Banks, Inc. and Subsidiaries
WEALTH AND INVESTMENT MANAGEMENT LINE OF BUSINESS
(Dollars in thousands) (Unaudited)
Three Months Ended
June 30 June 30 %
2008 2007 Change(3)
Statements of Income
Net interest income(10 $83,688 $87,723 (4.6)%
FTE adjustment 9 12 (25.0)
Net interest income - FTE 83,697 87,735 (4.6)
Provision for loan losses(2) 2,547 2,951 (13.7)
Net interest income after
provision for loan losses - FTE 81,150 84,784 (4.3)
Noninterest income before
securities gains/(losses) 269,119 250,194 7.6
Securities gains/(losses), net (33) 65 NM
Total noninterest income 269,086 250,259 7.5
Noninterest expense before
amortization/impairment of
intangible assets 233,315 242,869 (3.9)
Amortization/impairment of
intangible assets 49,728 6,553 NM
Total noninterest expense 283,043 249,422 13.5
Income before provision for
income taxes 67,193 85,621 (21.5)
Provision for income taxes 23,508 31,727 (25.9)
FTE adjustment 9 12 (25.0)
Net income $43,676 $53,882 (18.9)
Total revenue - FTE $352,783 $337,994 4.4
Selected Average Balances
Total loans $8,200,939 $8,026,076 2.2 %
Goodwill 329,282 304,262 8.2
Other intangible assets excluding
MSRs 120,193 136,557 (12.0)
Total assets 9,049,218 8,940,523 1.2
Total deposits 9,789,285 9,869,892 (0.8)
Performance Ratios
Efficiency ratio 80.23 % 73.79 %
Impact of excluding
amortization/impairment of
intangible assets (15.04) (2.94)
Tangible efficiency ratio 65.19 % 70.85 %
Other Information (End of Period)
Assets under administration
Managed (discretionary) assets $136,700,596 $139,149,853 (1.8)%
Non-managed assets 53,821,885 60,290,599 (10.7)
Total assets under
administration 190,522,481 199,440,452 (4.5)
Brokerage assets 37,847,007 42,494,858 (10.9)
Corporate trust assets 2,145,296 7,941,416 (73.0)
Total assets under advisement $230,514,784 $249,876,726 (7.7)
Six Months Ended
June 30 June 30 %
2008 2007 Change(3)
Statements of Income
Net interest income(1) $163,758 $177,787 (7.9)%
FTE adjustment 19 28 (32.1)
Net interest income - FTE 163,777 177,815 (7.9)
Provision for loan losses(2) 7,663 4,011 91.0
Net interest income after provision
for loan losses - FTE 156,114 173,804 (10.2)
Noninterest income before securities
gains/(losses) 600,468 535,927 12.0
Securities gains/(losses), net (28) 9 NM
Total noninterest income 600,440 535,936 12.0
Noninterest expense before
amortization/impairment of
intangible assets 470,813 506,870 (7.1)
Amortization/impairment of intangible
assets 54,514 10,216 NM
Total noninterest expense 525,327 517,086 1.6
Income before provision for income
taxes 231,227 192,654 20.0
Provision for income taxes 83,180 70,667 17.7
FTE adjustment 19 28 (32.1)
Net income $148,028 $121,959 21.4
Total revenue - FTE $764,217 $713,751 7.1
Selected Average Balances
Total loans $8,045,532 $8,110,682 (0.8)%
Goodwill 331,086 314,363 5.3
Other intangible assets excluding
MSRs 123,231 127,020 (3.0)
Total assets 8,927,369 9,000,934 (0.8)
Total deposits 9,791,854 9,827,249 (0.4)
Performance Ratios
Efficiency ratio 68.74 % 72.45 %
Impact of excluding
amortization/impairment of
intangible assets (7.95) (2.37)
Tangible efficiency ratio 60.79 % 70.08 %
Other Information (End of Period)
Assets under administration
Managed (discretionary) assets
Non-managed assets
Total assets under administration
Brokerage assets
Corporate trust assets
Total assets under advisement
(1) Net interest income does not include the funding benefit that would
result from holding shareholders' equity at the line of business level
due to the fact that shareholders' equity is not allocated to the
lines of business at this time.
(2) Provision for loan losses represents net charge-offs for the lines of
business.
(3) "NM" - Not meaningful. Those changes over 100 percent were not
considered to be meaningful.
SunTrust Banks, Inc. and Subsidiaries
CORPORATE OTHER AND TREASURY
(Dollars in thousands) (Unaudited)
Three Months Ended
June 30 June 30 %
2008 2007 Change(2)
Statements of Income
Net interest income $190,524 $130,300 46.2 %
FTE adjustment 4,487 4,267 5.2
Net interest income - FTE 195,011 134,567 44.9
Provision for loan losses(1) 123,884 16,403 NM
Net interest income after provision
for loan losses - FTE 71,127 118,164 (39.8)
Noninterest income before securities
gains/(losses) (45,552) 4,243 NM
Securities gains/(losses), net 551,038 236,347 NM
Total noninterest income 505,486 240,590 NM
Noninterest expense before
amortization of intangible assets (4,501) (40,123) (88.8)
Amortization of intangible assets 104 221 (52.9)
Total noninterest expense (4,397) (39,902) (89.0)
Income before provision for income
taxes 581,010 398,656 45.7
Provision for income taxes 174,251 126,573 37.7
FTE adjustment 4,487 4,267 5.2
Net income $402,272 $267,816 50.2
Total revenue - FTE $700,497 $375,157 86.7
Selected Average Balances
Total loans $134,914 $402,966 (66.5)%
Securities available for sale 13,853,680 17,524,366 (20.9)
Goodwill 106,812 (4) 7,094 NM
Other intangible assets excluding
MSRs 4,381 4,957 (11.6)
Total assets 20,292,751 25,902,896 (21.7)
Total deposits (primarily brokered
and foreign) 14,289,139 24,383,351 (41.4)
June 30 March 31
2008 2008
Other Information
Duration of investment portfolio 5.6 % 4.3 %
Accounting net interest income
interest rate sensitivity(3):
% Change in net interest income under:
Instantaneous 100 bp increase in
rates over next 12 months 0.1 % 0.4 %
Instantaneous 100 bp decrease in
rates over next 12 months (0.3)% (1.0)%
Economic net interest income interest
rate sensitivity(3):
% Change in net interest income under:
Instantaneous 100 bp increase in
rates over next 12 months (0.8)% (0.8)%
Instantaneous 100 bp decrease in
rates over next 12 months 0.6 % 0.2 %
Six Months Ended
June 30 June 30 %
2008 2007 Change(2)
Statements of Income
Net interest income $373,782 $237,680 57.3 %
FTE adjustment 9,629 8,451 13.9
Net interest income - FTE 383,411 246,131 55.8
Provision for loan losses(1) 387,517 10,073 NM
Net interest income after provision
for loan losses - FTE (4,106) 236,058 NM
Noninterest income before securities
gains/(losses) 106,574 93,904 13.5
Securities gains/(losses), net 495,457 236,420 NM
Total noninterest income 602,031 330,324 82.3
Noninterest expense before amortization
of intangible assets (40,687) (59,263) (31.3)
Amortization of intangible assets 206 442 (53.4)
Total noninterest expense (40,481) (58,821) (31.2)
Income before provision for income
taxes 638,406 625,203 2.1
Provision for income taxes 189,607 197,036 (3.8)
FTE adjustment 9,629 8,451 13.9
Net income $439,170 $419,716 4.6
Total revenue - FTE $985,442 $576,455 70.9
Selected Average Balances
Total loans $216,050 $388,104 (44.3)%
Securities available for sale 14,601,794 20,116,132 (27.4)
Goodwill 53,763 (4) 7,672 NM
Other intangible assets excluding
MSRs 4,433 5,073 (12.6)
Total assets 21,335,310 28,492,685 (25.1)
Total deposits (primarily brokered
and foreign) 14,902,402 25,742,603 (42.1)
Other Information
Duration of investment portfolio
Accounting net interest income
interest rate sensitivity(3):
% Change in net interest income under:
Instantaneous 100 bp increase in
rates over next 12 months
Instantaneous 100 bp decrease in
rates over next 12 months
Economic net interest income interest
rate sensitivity(3):
% Change in net interest income under:
Instantaneous 100 bp increase in
rates over next 12 months
Instantaneous 100 bp decrease in
rates over next 12 months
(1) Provision for loan losses includes net charge-offs for the lines of
business and the difference between net charge-offs and consolidated
provision for loan losses.
(2) "NM" - Not meaningful. Those changes over 100 percent were not
considered to be meaningful.
(3) The recognition of interest rate sensitivity from an accounting
perspective is different from the economic perspective due to the
election of fair value accounting for the related interest rate swaps.
The net interest income sensitivity profile from an economic
perspective assumes the net interest payments from the related swaps
were included in margin.
(4) Includes $144.8 million of Goodwill associated with the acquisition of
GB&T Bancshares, Inc. on May 1, 2008. This Goodwill has not been
allocated the lines of business at this time.
SunTrust Banks, Inc. and Subsidiaries
CONSOLIDATED - SEGMENT TOTALS
(Dollars in thousands) (Unaudited)
Three Months Ended
June 30 June 30 %
2008 2007 Change(1)
Statements of Income
Net interest income $1,156,716 $1,195,284 (3.2)%
FTE adjustment 28,256 24,668 14.5
Net interest income - FTE 1,184,972 1,219,952 (2.9)
Provision for loan losses 448,027 104,680 NM
Net interest income after
provision for loan losses - FTE 736,945 1,115,272 (33.9)
Noninterest income before
securities gains/(losses) 863,223 918,210 (6.0)
Securities gains/(losses), net 549,787 236,412 NM
Total noninterest income 1,413,010 1,154,622 22.4
Noninterest expense before
amortization/impairment of
intangible assets 1,313,798 1,226,290 7.1
Amortization/impairment of
intangible assets 64,735 24,904 NM
Total noninterest expense 1,378,533 1,251,194 10.2
Income before provision for
income taxes 771,422 1,018,700 (24.3)
Provision for income taxes 202,804 312,601 (35.1)
FTE adjustment 28,256 24,668 14.5
Net income $540,362 $681,431 (20.7)
Total revenue - FTE $2,597,982 $2,374,574 9.4
Selected Average Balances
Total loans $125,191,858 $118,164,626 5.9 %
Goodwill 7,020,683 6,895,400 1.8
Other intangible assets excluding
MSRs 287,284 358,091 (19.8)
Total assets 175,548,768 179,996,457 (2.5)
Total deposits 116,795,152 121,909,711 (4.2)
Performance Ratios
Efficiency ratio 53.06 % 52.69 %
Impact of excluding
amortization/impairment of
intangible assets (2.49) (1.05)
Tangible efficiency ratio 50.57 % 51.64 %
Six Months Ended
June 30 June 30 %
2008 2007 Change(1)
Statements of Income
Net interest income $2,296,583 $2,359,843 (2.7)%
FTE adjustment 56,231 48,381 16.2
Net interest income - FTE 2,352,814 2,408,224 (2.3)
Provision for loan losses 1,008,049 161,121 NM
Net interest income after
provision for loan losses - FTE 1,344,765 2,247,103 (40.2)
Noninterest income before
securities gains/(losses) 1,981,311 1,797,096 10.3
Securities gains/(losses), net 489,201 236,432 NM
Total noninterest income 2,470,512 2,033,528 21.5
Noninterest expense before
amortization/impairment of
intangible assets 2,548,227 2,438,745 4.5
Amortization/impairment of
intangible assets 85,450 48,446 76.4
Total noninterest expense 2,633,677 2,487,191 5.9
Income before provision for
income taxes 1,181,600 1,793,440 (34.1)
Provision for income taxes 294,452 542,332 (45.7)
FTE adjustment 56,231 48,381 16.2
Net income $830,917 $1,202,727 (30.9)
Total revenue - FTE $4,823,326 $4,441,752 8.6
Selected Average Balances
Total loans $124,227,447 $119,830,505 3.7 %
Goodwill 6,971,780 6,903,033 1.0
Other intangible assets excluding
MSRs 292,906 358,368 (18.3)
Total assets 176,232,836 180,747,241 (2.5)
Total deposits 116,716,037 123,200,869 (5.3)
Performance Ratios
Efficiency ratio 54.60 % 56.00 %
Impact of excluding
amortization/impairment of
intangible assets (1.77) (1.09)
Tangible efficiency ratio 52.83 % 54.91 %
(1) "NM" - Not meaningful. Those changes over 100 percent were not
considered to be meaningful.
SOURCE SunTrust Banks, Inc.
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