Company Says Resiliency Underscored by Continued Profitability and Improved
Capital Position
ATLANTA, Oct. 23 /PRNewswire-FirstCall/ -- SunTrust Banks, Inc. (NYSE:
STI) today reported net income available to common shareholders of $307.3
million for the third quarter of 2008, or $0.88 per average common diluted
share, compared to $412.6 million, or $1.18 per average common diluted
share, in the third quarter of 2007. The challenging credit environment
continued to have an adverse impact on the Company's financial performance
as evidenced by the increase in net charge-offs, nonperforming loans, and
credit-related expenses.
"SunTrust's continued profitability and improved capital position not
only underscore our resiliency in a quarter marked by unprecedented
industry turmoil, but also serve as a realistic basis for our confidence
that we will continue to manage successfully -- albeit not unscathed --
through the challenges that our industry clearly will face in the period
ahead," said James M. Wells III, Chairman, President and Chief Executive
Officer. "We also believe that there will be attractive growth
opportunities for SunTrust in the near future. With that in mind, we will
continue to take the steps necessary for us to be able to capitalize on
those opportunities."
Mr. Wells said the potential impact of economic weakness on credit
quality remains "near-term concern number one" for SunTrust even though the
Company has been seeing some "signs of slowing credit deterioration." Mr.
Wells said charge-offs, which were in line with expectations in the third
quarter, are likely to remain at elevated levels into 2009.
"We are managing our credit risk profile very carefully to minimize the
impact of further deterioration in the economy," said Mr. Wells. "However,
we have all seen how quickly things can change in this environment. As a
result, we do not believe it prudent or responsible to try to predict the
ultimate path of the economy and the resulting impact on asset quality and
earnings." Mr. Wells noted that the Company's Board of Directors has
authorized an application for the sale of preferred stock to the U.S.
Treasury under the TARP program, and also that the Company continues to
evaluate its capital structure and dividend policy. Mr. Wells said he
expects the evaluation to be completed "in short order" with any decisions
communicated promptly.
Mr. Wells pointed out that despite the current industry turmoil,
SunTrust's 30,000 employees remain "steadily focused every day on building
our business, serving our current customers, and attracting new ones who
find SunTrust's relative strength and stability a distinct competitive
advantage in these uncertain times."
SunTrust's previously announced capital enhancing transactions were
completed during the quarter and the results are reflected in the Company's
capital ratios. Estimated Tier 1 capital at September 30, 2008 is a healthy
8.15%, up 68 basis points from 7.47% at June 30, 2008. The total capital
ratio also increased and now exceeds 11%. In addition, the Company reported
total average equity to total average assets of 10.34%, and a tangible
equity to tangible asset ratio of 6.40% which is one of the highest ratios
among large banks.
Third Quarter 2008 Consolidated Highlights
3rd Quarter 3rd Quarter %
2008 2007 Change
Income Statement
(Dollars in millions, except per
share data)
Net income available to common shareholders $307.3 $412.6 (25.5)%
Net income per average common diluted share 0.88 1.18 (25.4)%
Revenue - fully taxable-equivalent 2,460.9 2,038.4 20.7%
Net interest income - fully taxable-
equivalent 1,175.7 1,219.2 (3.6)%
Provision for loan losses 503.7 147.0 242.6%
Noninterest income 1,285.2 819.1 56.9%
Noninterest expense 1,668.1 1,291.2 29.2%
Net interest margin 3.07% 3.18%
Efficiency ratio 67.78% 63.35%
Balance Sheet
(Dollars in billions)
Average loans $125.6 $119.6 5.1%
Average consumer and commercial deposits 100.2 96.7 3.6%
Capital
Tier 1 capital ratio(1) 8.15% 7.44%
Total average shareholders' equity to total
average assets 10.34% 10.05%
Tangible equity to tangible assets 6.40% 6.36%
Asset Quality
Net charge-offs to average loans
(annualized) 1.24% 0.34%
Nonperforming loans to total loans 2.60% 0.81%
(1) Current period Tier 1 capital ratio is estimated as of the earnings
release date.
-- Net income per average common diluted share decreased 25.4% from the
third quarter of 2007 primarily due to higher provision for loan losses,
higher credit-related expenses, the recognition of losses related to an
agreement in principle to purchase certain auction rate securities ("ARS"),
and valuation losses on trading assets. These impacts were partially offset
by net valuation gains on the Company's publicly traded debt and related
hedges carried at fair value and the gain on the sale of a non-strategic
subsidiary.
-- The third quarter of 2008 results included a number of gains and
losses that were a function of the current environment. Items that
positively impacted the reported results included mark-to-market gains on
the Company's public debt and related hedges of $0.60 per share, a gain on
the sale of TransPlatinum, the Company's fuel card and fleet management
subsidiary, of $0.14 per share, and the tax benefit from the contribution
of 3.6 million shares of The Coca-Cola Company ("Coke") to the Company's
charitable foundation of $0.20 per share. Items that negatively impacted
reported results included an expected market valuation write-down of ARS of
$0.31 per share and net mark-to-market losses on trading assets and loan
warehouses of $0.24 per share.
-- Fully taxable-equivalent revenue increased 20.7% compared to the
third quarter of 2007, as the gain recognized on the charitable
contribution of Coke shares, positive net market valuation impacts, the
gain on the sale of TransPlatinum, and core fee income growth more than
offset a decline in net interest income.
-- Fully taxable-equivalent net interest income declined 3.6% from the
third quarter of 2007 and was essentially flat compared to the prior
quarter. Net interest margin declined 6 basis points during the quarter and
11 basis points compared to the third quarter of 2007 due to the
detrimental impact of higher nonperforming loans, declining interest rates,
and a shift in loan and deposit mix.
-- Noninterest income increased 56.9% from the third quarter of 2007,
driven by securities gains related to the contribution of Coke stock to the
Company's charitable foundation, mark-to-market valuation gains on the
Company's public debt and related hedges, the gain from the sale of a
non-strategic business, and double digit growth in service charges, card
fees, mortgage-related income, and investment banking fees. Partially
offsetting these increases were the reduction in trust and investment
management income, the expected market valuation write-down of ARS, and
mark-to-market losses on trading assets and loan warehouses.
-- Noninterest expense increased 29.2% from the third quarter of 2007,
driven by increased credit-related expenses, the expense related to the
tax-free contribution of the Coke stock to the Company's charitable
foundation, and an increase in estimated VISA-related litigation liability.
Core operating expenses, excluding credit-related expenses, remained well
controlled as a result of the Company's efficiency and productivity
efforts.
-- Provision for income taxes for the quarter was a net benefit of
$52.8 million primarily related to the tax-free contribution of the Coke
stock, as well as lower taxable income.
-- Total average loans increased 5.1% from the third quarter of 2007
principally due to growth in the commercial loan portfolio. Average loans
held for sale declined 54.3%, as mortgage loan originations declined 35.5%
and efficiency in loan delivery improved. Average consumer and commercial
deposits increased 3.6% over the third quarter of 2007. The increase was
driven mainly by growth in NOW and money market account balances.
-- The estimated Tier 1 capital, total average shareholders' equity to
total average assets, and tangible equity to tangible asset ratios were
8.15%, 10.34%, and 6.40%, respectively.
-- Annualized quarterly net charge-offs were 1.24% of average loans for
the third quarter of 2008, up from 0.34% in the third quarter of 2007 and
1.04% in the second quarter of 2008. The increase reflects deterioration in
consumer residential real estate and residential construction loans.
-- Nonperforming loans to total loans increased to 2.60% as of
September 30, 2008, from 2.09% as of June 30, 2008, and 0.81% as of
September 30, 2007, due mainly to increased levels of nonperforming
residential real estate and construction loans.
CONSOLIDATED FINANCIAL PERFORMANCE
Revenue
Fully taxable-equivalent revenue was $2,460.9 million for the third
quarter of 2008, an increase of 20.7% compared to the third quarter of
2007, driven by the securities gains from the contribution of the Coke
stock, mark to market valuation gains on the Company's public debt and
related hedges carried at fair value, and increased fee income. These items
were partially offset by a 3.6% decline in net interest income, a decline
in trust and investment management income, and the expected market
valuation write-down of ARS.
For the nine months, fully taxable-equivalent revenue was $7,284.2
million, up 12.4% over prior year. The increase was driven by incremental
net securities gains of $424.8 million, gains from the sale of
non-strategic businesses and the sale/leaseback of certain corporate real
estate properties, the Visa IPO gain, net positive mark-to-market
valuations, and increased fee income from the Company's core businesses.
These contributions to growth were partially offset by lower net interest
income, trust and investment management income, and the write-down related
to ARS.
Net Interest Income
Fully taxable-equivalent net interest income was $1,175.7 million in
the third quarter of 2008, a decrease of 3.6% from the third quarter of
2007. Net interest margin declined 11 basis points compared to the third
quarter of 2007. On a sequential quarter basis, net interest margin
declined 6 basis points. The decline in net interest income was primarily
due to the increase in nonaccrual loans, a reduction in Coke and Federal
Home Loan Bank ("FHLB") dividend income, LIBOR rate volatility during
September in particular, and lower interest income associated with a small
increase in the Company's leverage lease ("LILO") reserves. While earning
assets remained essentially flat over the past twelve months, higher
yielding assets, such as loans held for sale, have declined and lower
yielding assets, such as commercial loans, have increased. Lower rates on
customer and wholesale deposits, as well as growth in customer deposits,
helped offset the decline in interest income.
For the nine months, fully taxable-equivalent net interest income was
$3,528.5 million, a decline of 2.7% from 2007 while net interest margin was
relatively flat. Balance sheet management strategies initiated in 2007 led
to a $3.8 billion, or 2.5%, decline in average earning assets, namely loans
held for sale, real estate construction loans, and interest-earning trading
assets, which was partially offset by growth in commercial loans.
Noninterest Income
Total noninterest income was $1,285.2 million for the third quarter of
2008, up 56.9% from the third quarter of 2007. The third quarter of 2008
included the gain from the contribution of Coke stock of $183.4 million to
a charitable foundation and a $81.8 million gain on the sale of
TransPlatinum, a fuel card and fleet management subsidiary, as well as
mark-to-market valuation gains on the Company's public debt and related
hedges of $341.0 million versus a mark-to-market valuation gain of $63.0
million in the third quarter of 2007. The gains on the Company's public
debt related to the widening in credit spreads across the entire financial
institutions sector as a result of the global credit crisis. When stability
in debt markets returns, spreads are expected to tighten, and, if this
occurs, then these valuation gains will reverse. The third quarter of 2008
also included $172.8 million of expected losses related to ARS and $136.9
million in mark-to-market losses on illiquid trading securities and loan
warehouses compared to $220.5 million in mark-to-market losses in the third
quarter of 2007. The fair value of the illiquid securities acquired in the
fourth quarter of 2007 declined to approximately $350 million, from
approximately $770 million as of June 30, 2008, primarily due to sales
during the third quarter. This reduction was partially offset by the
purchase in the third quarter of 2008 of a $70 million par value bond from
an affiliated money market mutual fund. As of September 30, 2008, the fair
value of this bond was $6.5 million.
The expected loss related to auction rate securities was recognized in
trading account profits and commissions as a result of the Company's
decision to offer to purchase ARS from certain clients and includes
approximately $5 million in regulatory fines. The par value of the
securities the Company will offer to purchase is approximately $725
million. Approximately $625 million of these securities are government
sponsored securities or securities where the issuer has indicated support
of the underlying assets. The remaining $100 million of securities pertains
to a senior tranche within a securitization of trust preferred securities.
We believe that the bulk of this write-down relates to liquidity and
duration risks not the ultimate collectability of estimated cash flows. The
majority of these securities are expected to be purchased in the fourth
quarter.
Mortgage production income was $50.0 million in the third quarter of
2008 compared to $13.0 million in the third quarter of 2007. Lower loan
production and related fees in 2008 were offset by a significant reduction
in valuation losses recorded in the third quarter of 2007 on the Alt-A
loans held in the warehouse. Mortgage servicing related income in the third
quarter of 2008 increased primarily due to higher servicing fee income
driven by growth in the servicing portfolio from $149.9 billion as of
September 30, 2007 to $159.3 billion as of September 30, 2008. On a
sequential quarter basis, servicing income increased primarily due to a
$19.0 million gain on sale of excess servicing rights.
In the third quarter of 2008, the Company experienced strong growth in
service charges on deposit accounts and card fees, which increased 12.3%
and 10.9%, respectively, over the same period of 2007. Investment banking
income grew 30.4%, related to increased loan syndication and capital
markets activity; however, trust and investment income declined 15.8%,
reflecting the sale of certain trust related businesses earlier in 2008 and
lower fee income attributable to the decline in the equity markets. Trading
account profits and commissions includes the mark-to-market valuation
adjustments on financial instruments carried at fair value including the
Company's publicly-traded debt and related hedges carried at fair value and
the ARS expected loss. Securities gains included the $183.4 million gain
from the contribution of Coke shares, partially offset by a $10.3 million
charge for other-than-temporary impairment of certain securities available
for sale.
For the nine months, total noninterest income was $3,755.7 million,
which was 31.7% over the same period of 2007. The increase was largely due
to the following transaction-related gains:
-- $497.4 million incremental gain on the sale and contribution of Coke
stock
-- $57.1 million incremental gain on sale of Lighthouse interests
-- $37.0 million gain on the sale/leaseback of corporate real estate
-- $81.8 million gain on the sale of TransPlatinum
-- $29.6 million gain on sale of First Mercantile Trust
-- $86.3 million gain recorded on the Visa IPO
Partially offsetting these gains was the expected market valuation
write-down of $172.8 million related to ARS and securities losses recorded
primarily in the first and third quarters of 2008 totaling $75.1 million in
conjunction with available-for-sale securities that were determined to be
other-than-temporarily impaired.
For the first nine months of 2008, SunTrust experienced solid growth in
most noninterest income categories, including service charges on deposits
accounts, up $82.6 million, other fees up, $28.4 million, card fees up,
$27.2 million, investment banking income up, $18.7 million, and retail
investment income up, $12.5 million. Trading account profits and
commissions increased $24.6 million over the first nine months of 2007 as
positive mark-to-market gains on the Company's public debt net of related
hedges exceeded mark-to-market losses on illiquid securities during 2008,
as compared to net mark-to-market losses during 2007.
Mortgage production income increased 190.1% over the first nine months
of 2007 due to the recognition of servicing value at the time of the
interest rate lock commitment in accordance with recently adopted
accounting standards, partially offset by a decline in loan production. The
prior period also included the impact of mortgage spread widening related
to Alt-A loans held in the mortgage loan warehouse, which have been
substantially eliminated, and $42.2 million of income reductions recorded
in conjunction with our adoption of specific fair value accounting
standards. Drivers behind changes in other components of noninterest income
categories were consistent with those impacting the third quarter.
Noninterest Expense
Total noninterest expense in the third quarter of 2008 was $1,668.1
million, up 29.2% from the third quarter of 2007. Almost half of the
increase was related to the $183.4 million contribution of Coke stock to
our charitable foundation recognized in marketing and customer development.
The majority of the remaining increase was due to credit-related expenses,
which increased $178.2 million over the third quarter of 2007.
Credit-related expenses include fraud losses primarily related to borrower
misrepresentations on mortgage loan documentation, other real estate
losses, credit and collection costs, and additions to mortgage insurance
reserves. Additionally, SunTrust increased its estimate of future liability
related to VISA litigation by $20 million as a result of a tentative
settlement. Excluding the charitable contribution, VISA litigation, and
credit-related items, expenses were well controlled as a result of the
Company's E2 Efficiency and Productivity Program, which through the third
quarter 2008 has generated gross savings of approximately $397 million.
Personnel expenses in the third quarter of 2008 increased 2.7% from the
same period in 2007. Salaries declined $8.6 million from the third quarter
of 2007, reflecting a reduction of approximately 3,500 full time equivalent
employees since September 30, 2007 to 29,447 as of quarter end 2008. The
increase in personnel expense is due primarily to the annual issuance of
restricted stock, and in the third quarter of 2007, a year-to-date downward
adjustment to incentive accruals. Other expenses in the third quarter of
2007 included a $45.0 million accrual for severance costs related to the E2
program and a $9.8 million debt extinguishment charge, partially offset by
a $33.6 million reduction of the accrued liability related to a capital
instrument. On a sequential quarter basis, the increase in outside
processing was substantially offset by the decrease in employee
compensation and benefits due to the outsourcing of certain back-office
operations in the third quarter of 2008.
For the nine months, total noninterest expense was $4,301.8 million, an
increase of 13.9% over the same period in 2007. The increase was primarily
due to increased credit-related costs of $290.7 million, the contribution
of Coke stock of $183.4 million, and the mortgage origination costs that
were previously deferred prior to the Company's election during the second
quarter of 2007 to record at fair value certain newly originated mortgage
loans held-for-sale.
Income Taxes
The Company recognized a benefit for income taxes of $52.8 million in
the third quarter of 2008 compared to a provision for income taxes of
$152.9 million in the third quarter of 2007. The decrease in income taxes
was due to lower taxable income and the recognition of a $68.5 million tax
benefit from the charitable contribution of 3.6 million Coke shares.
Balance Sheet
As of September 30, 2008, SunTrust had total assets of $174.8 billion.
Shareholders' equity of $18.0 billion as of September 30, 2008 represented
10.27% of total assets. Book value and tangible book value per common share
were $49.32 and $30.27 as of September 30, 2008, respectively.
Loans
Average loans for the third quarter of 2008 were $125.6 billion, up
$6.1 billion, or 5.1%, from the third quarter of 2007. The increase was
primarily in commercial-related categories. Average construction loans
declined $3.2 billion, or 23.3%, due to the Company's efforts to reduce its
exposure to construction loans and the transfer to nonaccrual loans.
Indirect auto loans declined $0.8 billion, or 10.2%, driven by SunTrust's
de-emphasis of this business. Average loans held-for-sale also declined
$5.3 billion, or 54.3%, as loan originations declined 35.5%, production
shifted to predominantly agency products, and efficiency improved in loan
delivery. On a sequential quarter basis, total average loans increased
slightly with the product trends remaining consistent.
Deposits
Average consumer and commercial deposits for the third quarter of 2008
were $100.2 billion, up $3.5 billion, or 3.6%, from the third quarter of
2007, as increases in NOW and money market deposits were partially offset
by declines in demand deposit and savings account balances. Average
brokered deposits declined $5.1 billion, or 32.3%, from the third quarter
of 2007 as consumer and commercial interest bearing deposits increased $4.1
billion. On a sequential quarter basis, total average deposits decreased
$0.8 billion, or 0.7%, driven by reductions in most deposit categories. The
decline in average balances was driven largely by decreases experienced in
July and August, as September reversed this trend with growing balances,
particularly in the later part of the month.
Capital
The estimated Tier 1 capital, total average shareholders' equity to
total average assets, and tangible equity to tangible assets ratios at
September 30, 2008 were 8.15%, 10.34%, and 6.40%, respectively. This
compares to 7.44%, 10.05%, and 6.36% at September 30, 2007 and 7.47%,
10.31%, and 6.27% at June 30, 2008. The increases are primarily
attributable to completion of the Coke transactions. The Company's
regulatory capital ratios are significantly in excess of the regulatory
requirements for well capitalized status.
Asset Quality
Nonaccrual loans were $3,289.5 million, or 2.60%, of total loans as of
September 30, 2008, compared to $2,625.3 million, or 2.09%, of total loans
as of June 30, 2008 and $974.8 million, or 0.81%, of total loans as of
September 30, 2007. The increase in nonaccrual loans was mainly due to an
increase in real estate construction loans and residential mortgages, as
the overall weakening of the housing markets and economy continued to
increase delinquencies. Other real estate owned also increased $52.5
million, or 15.7%, to $387.0 million, as the Company foreclosed on the
collateral securing specific nonperforming loans. Restructured loans still
accruing interest increased $217.7 million to $381.0 million as a result of
actions the Company is proactively taking to mitigate further losses and
enable borrowers to repay their loans under revised terms that in the long
run preserve the value of the Company's interests.
Annualized quarterly net charge-offs in the third quarter of 2008 were
1.24% of average loans, up from 0.34% in the third quarter of 2007 and
1.04% in the second quarter of 2008. Net charge-offs were $392.1 million in
the third quarter of 2008 compared to $322.7 million in the second quarter
of 2008 and $103.7 million in the third quarter of 2007. The increase in
net charge-offs over the third quarter of 2007 reflects the deterioration
in consumer credit and home values, particularly in residential real estate
secured loans. The increase in net charge-offs in 2008 has been most
pronounced in home equity lines, residential mortgages, and construction
loans as home values continued to fall. The provision for loan losses
increased to $503.7 million compared to $448.0 million in the second
quarter of 2008 and $147.0 million in the third quarter of 2007.
The allowance for loan and lease losses was $1,941.0 million as of
September 30, 2008 and represented 1.54% of period-end loans. Since
year-end 2007, the allowance to loans outstanding has increased 49 basis
points, as the deterioration in certain segments of the consumer and
residential real estate market continued. The allowance for loan and lease
losses as of September 30, 2008 represented 1.24 times annualized net
charge-offs in the quarter and 62.1% of period-end nonperforming loans.
LINE OF BUSINESS FINANCIAL PERFORMANCE
The following discussion details results for SunTrust's four business
lines: Retail and Commercial Banking, Wholesale Banking, Mortgage, and
Wealth and Investment Management. In 2007, the Company reported five
business segments.
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 for loan
losses 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
loan loss provision compared to net charge-offs, as well as equity and its
related impact.
Retail and Commercial Banking
Three Months Ended September 30, 2008 vs. 2007
Retail and Commercial Banking net income for the third quarter of 2008
was $64.7 million, a decrease of $138.1 million, or 68.1%, compared to the
third quarter of 2007. This decrease was primarily the result of higher
provision expense due to home equity line and commercial net charge-offs,
lower deposit related net interest income and higher credit and fraud
related noninterest expense, partially offset by strong growth in service
charges on deposits.
Net interest income decreased $51.6 million, or 7.3%, driven by a shift
in deposit mix and compressed spreads due to increased competition for
deposits. Average deposits increased $0.9 billion, or 1.1%, while deposit
spreads decreased 18 basis points resulting in a $32.8 million decrease in
net interest income. Low cost demand deposit and savings accounts decreased
a combined $1.3 billion, or 6.7%, primarily in commercial demand deposits
while higher cost NOW and money market accounts increased a combined $2.6
billion, or 7.4%. Certificates of deposit and IRA accounts dropped $0.4
billion, or 1.7%, although spreads increased slightly. Net interest income
from loans decreased $11.8 million as average loan balances declined $0.5
billion, or 1.0%. Average loan balances declined approximately $2.2 billion
related to the migration of middle market clients from the Retail and
Commercial line of business to Wholesale Banking. This decline was
substantially offset by loan growth from the GB&T acquisition, commercial
loans, equity lines, and student loans.
Provision for loan losses increased $151.1 million over the same period
in 2007. The provision increase was most pronounced in home equity lines,
reflecting deterioration in the residential real estate market, and
commercial loans, primarily to clients with annual revenue of less then $5
million.
Total noninterest income increased $30.2 million, or 9.4%, from the
third quarter of 2007. This increase was driven primarily by a $22.1
million, or 11.6%, increase in service charges on deposit accounts from
both consumer and business accounts primarily due to growth in the number
of accounts, higher NSF rates and an increase in occurrences of NSF fees.
Interchange fees increased $7.4 million, or 14.6%, and ATM revenue
increased $3.0 million, or 10.1%.
Total noninterest expense increased $47.1 million, or 7.4%, from the
third quarter of 2007. This increase was driven primarily by higher credit
related expenses including operating losses due to fraud, shared corporate
overhead expense, and continued investment in the branch distribution
network.
Nine Months Ended September 30, 2008 vs. 2007
Retail and Commercial Banking net income for the nine months ended
September 30, 2008 was $283.0 million, a decrease of $329.5 million, or
53.8%, compared to the same period in 2007. This decrease was primarily the
result of higher provision expense due to home equity line net charge-offs,
lower net interest income related to deposit spreads and higher
credit-related noninterest expense, partially offset by strong growth in
service charges on deposits.
Net interest income decreased $201.4 million, or 9.4%, driven by a
continued shift in deposit mix and decreased spreads as deposit competition
and the interest rate environment encouraged customers to migrate into
higher yielding interest-bearing deposits. Average deposit balances
increased $0.4 billion, or 0.5%, while deposit spreads decreased 30 basis
points resulting in a $172.7 million decrease in net interest income. Low
cost demand deposit and savings accounts decreased a combined $1.9 billion,
or 9.4%, driven by a decrease in commercial demand, while higher cost NOW
and money market accounts increased a combined $2.4 billion, or 7.0%. Net
interest income from loans decreased $21.8 million, or 2.8%, as average
loan balances declined $0.4 billion, or 0.8%. The transfer of middle market
clients to the Wholesale Banking line of business decreased loans by
approximately $2.1 billion and was partially offset by loans acquired in
the GB&T acquisition and growth in commercial loans, equity lines and
student loans.
Provision for loan losses increased $409.0 million over the same period
in 2007. The provision increase was most pronounced in home equity lines,
indirect auto, as well as in commercial loans primarily to clients with
annual revenue of less then $5 million.
Total noninterest income increased $101.6 million, or 11.0%, over the
same period in 2007. This increase was driven primarily by a $69.2 million,
or 13.0%, increase in service charges on both consumer and business deposit
accounts, primarily due to growth in the number of accounts, higher NSF
rates and an increase in occurrences of NSF fees. Interchange fees
increased $22.3 million, or 15.0%, while ATM revenue also increased $7.1
million, or 8.0%.
Total noninterest expense increased $15.9 million, or 0.8%, from the
same period in 2007. The continuing positive impact of expense savings
initiatives was offset by higher credit-related expenses, including
operating losses due to fraud, and continued investments in the branch
distribution network.
Wholesale Banking
Three Months Ended September 30, 2008 vs. 2007
Wholesale Banking net income for the third quarter of 2008 was $42.1
million, an increase of $9.7 million, or 30.2%, compared to the third
quarter of 2007. Lower mark-to-market trading losses and higher investment
banking income was partially offset by higher incentive based compensation
as well as decreased net interest income and increased provision expense.
Net interest income decreased $10.8 million, or 7.6%. While average
loan balances increased $5.2 billion, or 17.7%, the corresponding net
interest income declined $13.1 million, or 11.4%. Approximately $2.2
billion of the increase is related to the migration of middle market
clients from the Retail and Commercial line of business to the Wholesale
Banking line of business. Average loans in the legacy Wholesale Banking
line of business increased approximately $3.1 billion, or 10.5%, driven by
growth from large corporate clients partially offset by reductions in the
residential builder portfolio. The decline in loan related net interest
income is due to a shift in mix away from higher spread residential
construction loans to lower spread commercial loans, as well as increased
residential construction nonaccrual loans. Total average deposits were up
$4.0 billion, or 75.8%, primarily in higher cost corporate money market and
Eurodollar accounts. The net interest income associated with the
higher-cost deposit categories was relatively flat as the additional volume
was offset by lower deposit spreads.
Provision for loan losses was $32.3 million, an increase of $16.8
million, or 108.9%, from the same period in 2007. The increase resulted
from higher residential builder-related charge-offs partially offset by
lower charge-offs from large corporate clients.
Total noninterest income increased $85.8 million, or 118.4%. Solid
performance in loan syndications, fixed income sales, direct finance,
equity offerings and leasing, as well as lower mark-to-market trading
losses primarily related to structured products, were in part offset by
lower revenues in bond origination and structured leasing.
Total noninterest expense increased $24.2 million, or 13.5%. The
migration of middle market clients accounted for approximately $6.7 million
of the increase. The remainder of Wholesale Banking expenses increased
$17.5 million, or 9.8%, driven primarily by higher incentive-based
compensation primarily related to an increase in noninterest income,
partially offset by lower Affordable Housing related and discretionary
expenses.
Nine Months Ended September 30, 2008 vs. 2007
Wholesale Banking net income for the nine months ended September 30,
2008 was $206.5 million, a decrease of $37.3 million, or 15.3%, compared to
the same period in 2007. Lower mark-to-market trading losses were offset by
reductions in private equity gains, higher incentive based compensation, as
well as decreased net interest income and increased provision expense.
Net interest income decreased $26.3 million, or 6.1%. Average loan
balances increased $4.4 billion, or 15.1%, while the corresponding net
interest income declined $23.2 million, or 6.7%. Approximately $2.1 billion
of the loan increase is related to the migration of middle market clients
from the Retail and Commercial line of business to the Wholesale Banking
line of business. Average loans in the legacy Wholesale line of business
increased $2.3 billion, or 8.0%, driven by increased corporate banking
loans which were partially offset by reductions in the residential builder
portfolio. The decline in net interest income is due to a shift in mix away
from higher spread residential construction loans to lower spread
commercial loans and increased residential construction nonaccrual loans.
Total average deposits were up $4.1 billion, or 82.4%, primarily in higher
cost corporate money market and Eurodollar accounts. The associated net
interest income decreased $5.5 million driven by the lower credit for funds
on demand deposits. The net interest income associated with the higher-cost
deposit categories was relatively flat as the additional volume was offset
by the lower deposit spreads.
Provision for loan losses was $55.6 million, an increase of $21.7
million, or 64.1%, from the same period in 2007, resulting from higher
residential builder related charge-offs partially offset by lower
charge-offs in corporate banking.
Total noninterest income increased $49.8 million, or 10.7%. Lower
mark-to-market trading losses mainly affecting structured products was the
main driver of the increase. Solid performance in loan syndications, fixed
income and equity sales and trading, equity offerings and leasing were, in
part, offset by a reduction in private equity gains and lower revenues in
structured leasing, derivatives and M&A advisory.
Total noninterest expense increased $38.6 million, or 6.8%. The
transfer of middle market clients accounted for approximately $19.7 million
of the increase. The remainder of Wholesale Banking's expense increased
$18.9 million, or 3.4%, driven primarily by higher incentive-based
compensation primarily related to a 45% increase in Capital Markets
noninterest income. In addition, higher outside processing and credit
services expenses were partially offset by lower Affordable Housing,
personnel, and discretionary expenses.
Mortgage
Three Months Ended September 30, 2008 vs. 2007
Mortgage reported a net loss of $156.1 million for the third quarter of
2008, a $143.6 million higher loss compared with the third quarter of 2007.
The larger net loss was principally due to higher credit-related costs.
Net interest income declined $23.5 million, or 18.0%. Average loans
increased $1.0 billion, or 3.4%, while net interest income on loans
declined $19.9 million, or 22.8%. This decline was principally due to a
$1.2 billion increase in average nonaccrual loans which resulted in $12.1
million of the net interest income decline. Additionally, average consumer
mortgage and residential construction loans declined $0.3 billion resulting
in a net interest income decline of $7.4 million. Also contributing to the
decrease was a $4.0 million decline in net interest income on deposits
primarily related to a lower credit for funds on demand deposits.
Provision for loan losses increased $113.1 million over the $11.7
million recorded in the third quarter of 2007 due to higher residential
mortgage and residential construction net charge-offs.
Total noninterest income increased $38.5 million, or 42.8%. Mortgage
production income increased $29.6 million, or 148.4%. Total loan production
of $8.1 billion was down $4.5 billion, or 35.5%; however, valuation losses
due to spread widening in the mortgage market were lower in 2008 and offset
the negative effect of lower loan production. Servicing income increased
$5.8 million, or 10.2%. Higher service fees due to a larger servicing
portfolio were only partially offset by higher Mortgage Servicing Rights
("MSR") amortization. Total loans serviced at September 30, 2008 were
$159.3 billion compared with $149.9 billion at September 30, 2007.
Total noninterest expense increased $129.7 million, or 55.0%. Operating
losses increased $71.6 million principally driven by fraud related to
borrower misrepresentation, while reserves for mortgage reinsurance losses
increased $47.9 million. Other real estate and collection services expenses
increased $38.1 million. Commission expense was down $19.5 million due to
lower loan production as were other origination-related expenses.
Nine Months Ended September 30, 2008 vs. 2007
Mortgage reported a net loss of $276.8 million for the nine months
ended September 30, 2008, a decrease of $312.7 million compared to net
income of $35.9 million reported in the same period in 2007 principally due
to credit-related costs and lower servicing income.
Net interest income declined $33.2 million, or 8.4%. Average loans
increased $1.0 billion, or 3.2%, while the resulting net interest income
declined $48.2 million. This decline was principally due to a $1.1 billion
increase in average nonaccrual loans which contributed $32.6 million to the
decline in net interest income. Additionally, the changing mix in portfolio
assets drove an income decline of $15.5 million, as declining construction
perm and Alt A balances were replaced with lower yielding prime first lien
mortgages. Average deposits increased $0.1 billion, or 5.1%, while the
resulting net interest income decreased $6.4 million due primarily to lower
funds credit for demand deposits. Partially offsetting the decline was
higher income from loans held for sale of $26.7 million due to wider
spreads and higher income from mortgage-backed securities of $19.4 million.
Provision for loan losses increased $316.1 million, to $351.1 million
from $35.0 million, due to higher residential mortgage and residential
construction net charge-offs.
Total noninterest income increased $103.9 million, or 39.1%. Total loan
production of $29.2 billion was down $16.2 billion, or 35.7%, from the
prior year. While production income was negatively affected by lower loan
production, total production income increased $138.9 million, or 200.9%,
due to lower valuation losses resulting from spread widening in the
mortgage market in 2008 and recognition of loan origination fees resulting
from the Company's election to record certain mortgage loans at fair value
beginning in May 2007. Servicing income was down principally due to higher
MSR amortization and hedge costs and lower gains on sale of mortgage
servicing assets. These declines were partially offset by higher service
fees due to a larger servicing portfolio. Total loans serviced at September
30, 2008 were $159.3 billion compared with $149.9 billion at September 30,
2007.
Total noninterest expense increased $254.5 million, or 43.5%. Operating
losses increased $101.8 million principally driven by fraud related to
borrower misrepresentation. Reserves for mortgage reinsurance losses
increased $79.8 million while other real estate expense and collection
services expense increased $70.8 million. Additionally, the recognition of
loan origination costs resulting from the Company's election to record
certain mortgage loans at fair value beginning in May 2007 increased
noninterest expense compared with the prior year. These increases were
partially offset by lower commission expense which was down $58.7 million
due to lower loan production.
Wealth and Investment Management
Three Months Ended September 30, 2008 vs. 2007
Wealth and Investment Management's net income for the third quarter of
2008 was $4.4 million, a decrease of $56.8 million, or 92.8%. The decline
in net income was primarily the result of a mark-to-market loss on a single
security. In September 2008, the Company purchased $70 million of Lehman
Brothers Holdings Inc. ("Lehman") bonds, at par, from the RidgeWorth Prime
Quality Money Market Fund in order to protect SunTrust clients from
possible losses associated with Lehman's default. Subsequent to purchase, a
$63.5 million pre-tax mark-to-market loss was recorded reflecting the fair
value as of September 30, 2008.
Net interest income decreased $3.1 million, or 3.6%, primarily due to
compressed spreads on loans and deposits. Average deposits were down 0.3%
and net interest income declined $1.6 million, or 2.9%, primarily related
to a lower credit for funds on demand deposits. Average loans increased
$0.4 billion, or 4.7%, driven by a $240.7 million increase in commercial
loans. However, the increase in balances was offset by decreased spreads in
both the consumer and commercial portfolios resulting in a $2.3 million
decrease in net interest income.
Provision for loan losses increased $7.2 million primarily due to
higher home equity, consumer direct, and consumer mortgage net charge-offs.
Total noninterest income decreased $96.7 million, or 37.4%, driven by
the $63.5 million mark-to-market loss on the Lehman bonds and the sale of
Lighthouse Partners and First Mercantile Trust. Retail investment income
increased $0.9 million, or 1.3%, due to higher annuity sales and recurring
managed account fees. Trust income decreased $27.5 million, or 15.7%,
primarily due to lower revenue streams stemming from the sale of Lighthouse
Partners and First Mercantile Trust and lower market valuations on managed
equity assets. As of September 30, 2008, assets under management were
approximately $129.5 billion compared to $142.9 billion as of September 30,
2007. Assets under management include individually managed assets, the
RidgeWorth Funds, institutional assets managed by RidgeWorth Capital
Management, and participant-directed retirement accounts. SunTrust's total
assets under advisement were approximately $218.3 billion, which includes
$129.5 billion in assets under management, $51.4 billion in non-managed
trust assets, $35.9 billion in retail brokerage assets, and $1.7 billion in
non-managed corporate trust assets.
Total noninterest expense decreased $17.5 million, or 7.1%, driven by
lower staff and discretionary expenses, as well as lower structural expense
resulting from the sale of Lighthouse Partners and First Mercantile Trust.
Nine Months Ended September 30, 2008 vs. 2007
Wealth and Investment Management's net income for the nine months ended
September 30, 2008 was $153.3 million, a decrease of $30.5 million, or
16.6%, from the prior year. The following transactions represented $13.6
million of the year-over-year decline:
-- $39.4 million decrease due to the after-tax impact of the
mark-to-market loss on Lehman bonds.
-- $55.4 million increase due to the after-tax gain on sale of a
minority interest in Lighthouse Investment Partners in the first quarter of
2008.
-- $18.4 million increase due to the after-tax gain on the sale of
First Mercantile Trust in the second quarter of 2008.
-- $27.9 million decrease due to the after-tax impairment charge on a
client-based intangible asset incurred in the second quarter of 2008.
-- $20.1 million decrease due to the after-tax gain resulting from the
sale upon merger of Lighthouse Partners into Lighthouse Investment Partners
in the first quarter of 2007.
Net interest income decreased $17.1 million, or 6.4%, primarily due to
a shift in deposit mix to higher cost deposits. Average deposits were
practically unchanged as declines in demand deposits and savings accounts
were offset by increases in higher-cost NOW and money market accounts. This
shift in deposit mix coupled with compressed spreads due to increased
competition for deposits resulted in a $13.2 million decrease in net
interest income. Average loans increased slightly as growth in commercial
loans was partially offset by declines in higher spread consumer loans
resulting in a $3.6 million decline in net interest income.
Provision for loan losses increased $10.9 million, or 183.9%, driven by
higher home equity, consumer direct, and consumer mortgage net charge-offs.
Total noninterest income decreased $32.1 million, or 4.0%, compared to
the nine months ended September 30, 2007 driven by the $63.5 million
mark-to-market loss on Lehman bonds. This decline was partially offset by a
$29.6 million gain on sale of First Mercantile Trust and $28.7 million of
incremental revenue from the sale of our Lighthouse Partners investment.
Retail investment income increased $9.6 million, or 4.7%, due to higher
annuity sales and higher recurring managed account fees. Trust income
decreased $48.0 million, or 9.4%, primarily due to the aforementioned sales
of Lighthouse Partners and First Mercantile Trust which resulted in a $37.4
million decline in trust income.
Total noninterest expense decreased $9.6 million, or 1.3%. This decline
includes a $45.0 million impairment charge on a client based intangible
incurred in the second quarter of 2008. Noninterest expense before
intangible amortization declined $50.9 million, or 6.8%, driven by lower
staff, discretionary, and indirect expenses, as well as lower structural
expense resulting from the sales of Lighthouse Partners and First
Mercantile Trust.
Corporate Other and Treasury
Three Months Ended September 30, 2008 vs. 2007
Corporate Other and Treasury's net income for the third quarter of 2008
was $357.4 million, an increase of $221.0 million, or 162.0%, compared to
the third quarter of 2007. The increase was driven by the release of a
deferred tax liability related to the charitable contribution of Coke
stock, net positive valuations on long-term debt and related hedges carried
at fair value, lower mark-to-market losses on trading securities and the
gain on sale of the TransPlatinum subsidiary. These increases were
partially offset by the expected market valuation write-down of auction
rate securities and an increase in provision for loan losses.
Net interest income increased $45.5 million, or 29.5%, over the same
period in 2007 mainly due to interest risk management activities. Total
average assets decreased $4.0 billion, or 17.6%, mainly due to the
reduction in the size of the investment portfolio as part of the Company's
overall balance sheet management strategy. Total average deposits decreased
$6.7 billion, or 31.1%, mainly due to a decrease in brokered deposits, as
the Company reduced its reliance on wholesale funding sources.
Provision for loan losses, which predominantly represents the
difference between consolidated provision for loan losses and net
charge-offs for the lines of business, increased $68.4 million, or 157.8%,
due to a higher increase in the Company's allowance for loan losses.
Total noninterest income increased $408.3 million in the third quarter
of 2008 compared to the same period in 2007. Of the increase, $278.0
million was driven by net valuation gains on publicly-traded debt. These
net valuation gains are primarily due to the significant widening in credit
spreads on the Company's publicly-traded debt and related hedges carried at
fair value. There was also an increase of $177.7 million in securities
gains primarily from the gain on the contribution of Coke stock and a gain
of $81.8 million on sale of the TransPlatinum subsidiary. These increases
were partially offset by the expected market valuation write-down of $172.8
million on auction rate securities.
Total noninterest expense increased $193.3 million compared to the
third quarter of 2007. The increase in expense was mainly due to a $183.4
million charitable contribution of Coke stock, and increase in the VISA
related litigation liability.
Nine Months Ended September 30, 2008 vs. 2007
Corporate Other and Treasury's net income for the nine months ended
September 30, 2008 was $777.3 million, an increase of $230.5 million, or
42.1%, from the same period in 2007. The increase was driven by securities
gains primarily related to the incremental gains on the sale and
contribution of Coke stock, net valuation gains on the Company's
publicly-traded debt and related hedges carried at fair value, and the gain
on sale of the TransPlatinum subsidiary. These increases were partially
offset by the expected market valuation write-down of auction rate
securities, mark-to-market valuation losses on illiquid trading securities
and provision for loan losses.
Net interest income increased $178.9 million, or 45.7%, over the same
period in 2007 mainly due to interest rate risk management activities.
Total average assets decreased $6.1 billion, or 22.9%, mainly due to the
reduction in the size of trading assets. Total average deposits decreased
$9.4 billion, or 38.8%, mainly due to a decrease in brokered and foreign
deposits as the Company reduced its reliance on wholesale funding sources.
Provision for loan losses, which predominantly represents the
difference between consolidated provision for loan losses and net
charge-offs for the lines of business, increased $445.8 million in
conjunction with an increase in the allowance for loan losses due primarily
to expected deterioration in the residential real estate market and related
loan credit quality.
Total noninterest income increased $680.0 million compared to the same
period in 2007 mainly due to a $497.4 increase in gains on the sale and
contribution of Coke stock. Additionally, there was an $86.3 million gain
on holdings of VISA in connection with its initial public offering, an
$81.8 million gain on sale of TransPlatinum, and an additional $37.0
million gain from the sale/leaseback of real estate properties. Noninterest
income also included an additional increase of $442.9 million of net
positive mark-to-market valuations on the Company's public debt and related
hedges carried at fair value. These valuations reflect the widening in the
credit spreads on SunTrust's publicly-traded debt carried at fair value.
These gains were partially offset by $176.6 million in net valuation losses
on illiquid trading securities, an expected loss of $172.8 million on ARS,
an $81.0 million decrease due to gains on trading assets and liabilities
recorded in 2007 related to the Company's adoption of fair value, and a
$58.4 million increase in securities losses during this period primarily
driven by market value impairment related to certain asset-backed
securities that were estimated to be other-than-temporarily impaired.
Total noninterest expense increased $223.9 million from the same period
in 2007. The increase in expense was mainly due to the $183.4 million
charitable contribution of Coke stock, and an increase in the VISA related
litigation liability.
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 also available on the Company's
Web site at http://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 furnished 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 October 23, 2008, at
8:00 a.m. (Eastern Time) to discuss the earnings results and business
trends. Individuals may call in beginning at 7:45 a.m. (Eastern Time) by
dialing 1-888-972-7805 (Passcode: 3Q08). Individuals calling from outside
the United States should dial 1-517-308-9091 (Passcode: 3Q08). A replay of
the call will be available one hour after the call ends on October 23,
2008, and will remain available until November 6, 2008, dialing
1-866-435-5412 (domestic) or 1-203-369-1031 (international).
Alternatively, individuals may listen to the live webcast of the
presentation by visiting the SunTrust Web site at http://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, 3rd Quarter Earnings Release."
Beginning the afternoon of October 23, 2008, 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 various subsidiaries the Company provides credit cards,
mortgage banking, insurance, brokerage, equipment leasing and capital
markets services. SunTrust's Internet address is http://www.suntrust.com.
Important Cautionary Statement About 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 "believes," "expects," "anticipates,"
"estimates," "intends," "plans," "targets," "initiatives," "potentially,"
"probably," "projects," "outlook" or similar expressions or future
conditional verbs such as "may," "will," "should," "would," and "could."
Such statements are based upon the current beliefs and expectations of
management and on information currently available to management. The
forward-looking statements are intended to be subject to the safe harbor
provided by Section 27A of the Securities Act of 1933 and Section 21E of
the Securities Exchange Act of 1934. Such statements speak as of the date
hereof, and we do not assume any obligation to update the statements made
herein or to update the reasons why actual results could differ from those
contained in such statements in light of new information or future events.
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 actual results
to differ materially from those described in the forward-looking statements
can be found in Exhibit 99.3 to our Current Reports on Form 8-K filed on
October 23, 2008 with the Securities and Exchange Commission and available
at the Securities and Exchange Commission's internet site
(http://www.sec.gov). Those factors include: difficult market conditions
have adversely affected our industry; current levels of market volatility
are unprecedented; the soundness of other financial institutions could
adversely affect us; there can be no assurance that recently enacted
legislation will stabilize the U.S. financial system; the impact on us of
recently enacted legislation, in particular the Emergency Economic
Stabilization Act of 2008 and its implementing regulations, and actions by
the FDIC, cannot be predicted at this time; credit risk; weakness in the
economy and in the real estate market, including specific weakness within
our geographic footprint, has adversely affected us and may continue to
adversely affect us; weakness in the real estate market, including the
secondary residential mortgage loan markets, has adversely affected us and
may continue to adversely affect us; as a financial services company,
adverse changes in general business or economic conditions could have a
material adverse effect on our financial condition and results of
operations; changes in market interest rates or capital markets could
adversely affect our revenue and expense, the value of assets and
obligations, and the availability and cost of capital or liquidity; the
fiscal and monetary policies of the federal government and its agencies
could have a material adverse effect on our earnings; we may be required to
repurchase mortgage loans or indemnify mortgage loan purchasers as a result
of breaches of representations and warranties, borrower fraud, or certain
borrower defaults, which could harm our liquidity, results of operations
and financial condition; clients could pursue alternatives to bank
deposits, causing us to lose a relatively inexpensive source of funding;
consumers may decide not to use banks to complete their financial
transactions, which could affect net income; we have businesses other than
banking which subject us to a variety of risks; hurricanes and other
natural disasters may adversely affect loan portfolios and operations and
increase the cost of doing business; negative public opinion could damage
our reputation and adversely impact our business and revenues; we rely on
other companies to provide key components of our business infrastructure;
we rely on our systems, employees and certain counterparties, and certain
failures could materially adversely affect our operations; we depend on the
accuracy and completeness of information about clients and counterparties;
regulation by federal and state agencies could adversely affect our
business, revenue and profit margins; competition in the financial services
industry is intense and could result in losing business or reducing
margins; future legislation could harm our competitive position;
maintaining or increasing market share depends on market acceptance and
regulatory approval of new products and services; we may not pay dividends
on our common stock; our ability to receive dividends from our subsidiaries
accounts for most of our revenue and could affect our liquidity and ability
to pay dividends; significant legal actions could subject us to substantial
uninsured liabilities; recently declining values of residential real estate
may increase our credit losses, which would negatively affect our financial
results; deteriorating credit quality, particularly in real estate loans,
has adversely impacted us and may continue to adversely impact us;
disruptions in our ability to access global capital markets may negatively
affect our capital resources and liquidity; any reduction in our credit
rating could increase the cost of our funding from the capital markets; we
have in the past and may in the future pursue acquisitions, which could
affect costs and from which we may not be able to realize anticipated
benefits; we depend on the expertise of key personnel; we may not be able
to hire or retain additional qualified personnel and recruiting and
compensation costs may increase as a result of turnover, both of which may
increase costs and reduce profitability and may adversely impact our
ability to implement our business strategy; our accounting policies and
methods are key to how we report our financial condition and results of
operations, and these require us to make estimates about matters that are
uncertain; changes in our accounting policies or in accounting standards
could materially affect how we report our financial results and condition;
our stock price can be volatile; our disclosure controls and procedures may
not prevent or detect all errors or acts of fraud; our financial
instruments carried at fair value expose us to certain market risks; our
revenues derived from our investment securities may be volatile and subject
to a variety of risks; we may enter into transactions with off-balance
sheet affiliates or our subsidiaries that could result in current or future
gains or losses or the possible consolidation of those entities; and we are
subject to market risk associated with our asset management and commercial
paper conduit businesses.
ADD: /FIRST ADD -- CLTH032 -- SunTrust Banks, Inc./
SunTrust Banks, Inc. and Subsidiaries
FINANCIAL HIGHLIGHTS
(Dollars in millions, except per share data) (Unaudited)
Three Months Ended
September 30 %
2008 2007 Change
EARNINGS & DIVIDENDS
Net income $312.4 $420.2 (25.7)%
Net income available to common
shareholders 307.3 412.6 (25.5)
Total revenue - FTE (2) 2,460.9 2,038.4 20.7
Total revenue - FTE excluding
securities (gains)/losses, net (1) 2,287.9 2,037.5 12.3
Net income per average common share
Diluted 0.88 1.18 (25.4)
Basic 0.88 1.19 (26.1)
Dividends paid per average common share 0.77 0.73 5.5
CONDENSED BALANCE SHEETS
Selected Average Balances
Total assets $173,888 $174,653 (0.4)%
Earning assets 152,320 152,328 -
Loans 125,642 119,559 5.1
Consumer and commercial deposits 100,200 96,708 3.6
Brokered and foreign deposits 15,800 21,140 (25.3)
Total shareholders' equity 17,982 17,550 2.5
As of
Total assets 174,777 175,857 (0.6)
Earning assets 152,904 151,229 1.1
Loans 126,718 120,748 4.9
Allowance for loan and lease losses 1,941 1,094 77.4
Consumer and commercial deposits 101,829 98,834 3.0
Brokered and foreign deposits 14,083 17,026 (17.3)
Total shareholders' equity 17,956 17,907 0.3
FINANCIAL RATIOS & OTHER DATA
Return on average total assets 0.71% 0.95% (25.3)%
Return on average assets less net
unrealized securities gains (1) 0.45 0.93 (51.6)
Return on average common shareholders'
equity 6.99 9.60 (27.2)
Return on average realized common
shareholders' equity (1) 4.55 9.86 (53.9)
Net interest margin (2) 3.07 3.18 (3.5)
Efficiency ratio (2) 67.78 63.35 7.0
Tangible efficiency ratio (1) 67.03 62.13 7.9
Effective tax rate (20.32) 26.68 NM
Tier 1 capital ratio 8.15 (3) 7.44 9.5
Total capital ratio 11.15 (3) 10.72 4.0
Tier 1 leverage ratio 7.95 (3) 7.28 9.2
Total average shareholders' equity to
total average assets 10.34 10.05 2.9
Tangible equity to tangible assets (1) 6.40 6.36 0.6
Full-time equivalent employees 29,447 32,903 (10.5)
Number of ATMs 2,506 2,518 (0.5)
Full service banking offices 1,692 1,683 0.5
Traditional 1,370 1,339 2.3
In-store 322 344 (6.4)
Book value per common share $49.32 $50.01 (1.4)
Market price:
High 64.00 90.47 (29.3)
Low 25.60 73.61 (65.2)
Close 44.99 75.67 (40.5)
Market capitalization 15,925 26,339 (39.5)
Average common shares outstanding
(000s)
Diluted 350,970 349,592 0.4
Basic 349,916 346,150 1.1
Nine Months Ended
September 30 %
2008 2007 Change
EARNINGS & DIVIDENDS
Net income $1,143.4 $1,622.9 (29.5)%
Net income available to common
shareholders 1,126.2 1,600.5 (29.6)
Total revenue - FTE (2) 7,284.2 6,480.1 12.4
Total revenue - FTE excluding
securities (gains)/losses, net (1) 6,622.0 6,242.6 6.1
Net income per average common share
Diluted 3.22 4.52 (28.8)
Basic 3.23 4.57 (29.3)
Dividends paid per average common share 2.31 2.19 5.5
CONDENSED BALANCE SHEETS
Selected Average Balances
Total assets $175,446 $178,694 (1.8)%
Earning assets 152,601 156,439 (2.5)
Loans 124,702 119,739 4.1
Consumer and commercial deposits 101,029 97,471 3.7
Brokered and foreign deposits 15,447 23,925 (35.4)
Total shareholders' equity 18,045 17,732 1.8
As of
Total assets
Earning assets
Loans
Allowance for loan and lease losses
Consumer and commercial deposits
Brokered and foreign deposits
Total shareholders' equity
FINANCIAL RATIOS & OTHER DATA
Return on average total assets 0.87% 1.21% (28.1)%
Return on average assets less net
unrealized securities gains (1) 0.53 1.09 (51.4)
Return on average common shareholders'
equity 8.57 12.42 (31.0)
Return on average realized common
shareholders' equity (1) 5.56 11.70 (52.5)
Net interest margin (2) 3.09 3.10 (0.3)
Efficiency ratio (2) 59.06 58.31 1.3
Tangible efficiency ratio (1) 57.63 57.18 0.8
Effective tax rate 17.45 29.99 (41.8)
Tier 1 capital ratio
Total capital ratio
Tier 1 leverage ratio
Total average shareholders' equity to
total average assets 10.29 9.92 3.6
Tangible equity to tangible assets (1)
Full-time equivalent employees
Number of ATMs
Full service banking offices
Traditional
In-store
Book value per common share
Market price:
High 70.00 94.18 (25.7)
Low 25.60 73.61 (65.2)
Close 44.99 75.67 (40.5)
Market capitalization
Average common shares outstanding
(000s)
Diluted 349,613 354,244 (1.3)
Basic 348,409 350,501 (0.6)
(1) See Appendix A and Appendix B for reconcilements of non-GAAP
performance measures.
(2) Total 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.
SunTrust Banks, Inc. and Subsidiaries
FIVE QUARTER FINANCIAL HIGHLIGHTS
(Dollars in millions, except per share data) (Unaudited)
Three Months Ended
Sept. 30 June 30 March 31 Dec. 31 Sept. 30
2008 2008 2008 2007 2007
EARNINGS & DIVIDENDS
Net income $312.4 $540.4 $290.6 $11.1 $420.2
Net income available to
common shareholders 307.3 535.3 283.6 3.3 412.6
Total revenue - FTE (2) 2,460.9 2,598.0 2,225.3 1,770.8 2,038.4
Total revenue - FTE
excluding securities
(gains)/losses, net (1) 2,287.9 2,048.2 2,285.9 1,765.1 2,037.4
Net income per average
common share
Diluted 0.88 1.53 0.81 0.01 1.18
Basic 0.88 1.53 0.82 0.01 1.19
Dividends paid per
average common share 0.77 0.77 0.77 0.73 0.73
CONDENSED BALANCE SHEETS
Selected Average Balances
Total assets $173,888 $175,549 $176,917 $175,130 $174,653
Earning assets 152,320 152,483 153,004 151,541 152,328
Loans 125,642 125,192 123,263 121,094 119,559
Consumer and commercial
deposits 100,200 101,727 101,168 99,649 96,708
Brokered and foreign
deposits 15,800 15,068 15,469 15,717 21,140
Total shareholders'
equity 17,982 18,093 18,062 18,033 17,550
As of
Total assets 174,777 177,233 178,987 179,574 175,857
Earning assets 152,904 154,716 152,715 154,397 151,229
Loans 126,718 125,825 123,713 122,319 120,748
Allowance for loan and
lease losses 1,941 1,829 1,545 1,283 1,094
Consumer and commercial
deposits 101,829 102,434 103,432 101,870 98,834
Brokered and foreign
deposits 14,083 17,146 12,747 15,973 17,026
Total shareholders'
equity 17,956 17,907 18,431 18,053 17,907
FINANCIAL RATIOS & OTHER
DATA
Return on average total
assets 0.71% 1.24% 0.66% 0.03% 0.95%
Return on average assets
less net unrealized
securities gains (1) 0.45 0.42 0.72 (0.01) 0.93
Return on average common
shareholders' equity 6.99 12.24 6.49 0.07 9.60
Return on average
realized common
shareholders' equity (1) 4.55 4.36 7.69 (0.33) 9.86
Net interest margin (2) 3.07 3.13 3.07 3.13 3.18
Efficiency ratio (2) 67.78 53.06 56.40 82.19 63.35
Tangible efficiency
ratio (1) 67.03 50.57 55.47 80.86 62.13
Effective tax rate (20.32) 27.29 23.98 (116.22) 26.68
Tier 1 capital ratio 8.15(3) 7.47 7.23 6.93 7.44
Total capital ratio 11.15(3) 10.85 10.97 10.30 10.72
Tier 1 leverage ratio 7.95(3) 7.54 7.22 6.90 7.28
Total average
shareholders' equity
to total average assets 10.34 10.31 10.21 10.30 10.05
Tangible equity to
tangible assets (1) 6.40 6.27 6.56 6.31 6.36
Full-time equivalent
employees 29,447 31,602 31,745 32,323 32,903
Number of ATMs 2,506 2,506 2,509 2,507 2,518
Full service banking
offices 1,692 1,699 1,678 1,682 1,683
Traditional 1,370 1,374 1,343 1,343 1,339
In-store 322 325 335 339 344
Book value per common
share $49.32 $49.24 $51.26 $50.38 $50.01
Market price:
High 64.00 60.80 70.00 78.76 90.47
Low 25.60 32.34 52.94 60.02 73.61
Close 44.99 36.22 55.14 62.49 75.67
Market capitalization 15,925 12,805 19,290 21,772 26,339
Average common shares
outstanding (000s)
Diluted 350,970 349,783 348,072 348,072 349,592
Basic 349,916 348,714 346,581 345,917 346,150
(1) See Appendix A and Appendix B for reconcilements of non-GAAP
performance measures.
(2) Total 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.
SunTrust Banks, Inc. and Subsidiaries
CONSOLIDATED STATEMENTS OF INCOME
(Dollars in thousands, except per share data) (Unaudited)
Three Months Ended
September 30 Increase/(Decrease)(2)
2008 2007 Amount %
Interest income $2,017,314 $2,515,292 ($497,978) (19.8)%
Interest expense 871,101 1,323,104 (452,003) (34.2)
NET INTEREST INCOME 1,146,213 1,192,188 (45,975) (3.9)
Provision for loan losses 503,672 147,020 356,652 NM
NET INTEREST INCOME AFTER
PROVISION FOR LOAN LOSSES 642,541 1,045,168 (402,627) (38.5)
NONINTEREST INCOME
Service charges on deposit
accounts 240,241 213,939 26,302 12.3
Trust and investment
management income 147,477 175,242 (27,765) (15.8)
Retail investment services 72,791 71,064 1,727 2.4
Other charges and fees 128,776 120,730 8,046 6.7
Investment banking income 62,164 47,688 14,476 30.4
Trading account profits/
(losses) and commissions 121,136 (31,187) 152,323 NM
Card fees 78,138 70,450 7,688 10.9
Mortgage production related
income 50,028 12,950 37,078 NM
Mortgage servicing related
income 62,654 57,142 5,512 9.6
Gain on sale of businesses 81,813 - 81,813 NM
Gain on Visa IPO - - - -
Net gain on sale/leaseback
of premises - - - -
Other noninterest income 66,958 80,130 (13,172) (16.4)
Securities gains/(losses),
net 173,046 991 172,055 NM
Total noninterest income 1,285,222 819,139 466,083 56.9
NONINTEREST EXPENSE
Employee compensation and
benefits 696,210 677,765 18,445 2.7
Net occupancy expense 88,745 87,626 1,119 1.3
Outside processing and
software 132,361 105,132 27,229 25.9
Equipment expense 51,931 51,532 399 0.8
Marketing and customer
development 217,693 46,897 170,796 NM
Amortization/impairment of
intangible assets 18,551 24,820 (6,269) NM
Net loss on extinguishment
of debt - 9,800 (9,800) (100.0)
Visa litigation 20,000 - 20,000 -
Operating losses 135,183 52,041 83,142 NM
Other noninterest expense 307,412 235,632 71,780 30.5
Total noninterest expense 1,668,086 1,291,245 376,841 29.2
INCOME BEFORE PROVISION/
(BENEFIT) FOR INCOME TAXES 259,677 573,062 (313,385) (54.7)
Provision/(Benefit) for
income taxes (52,767) 152,898 (205,665) NM
Net income 312,444 420,164 (107,720) (25.6)
Preferred dividends 5,111 7,526 (2,415) (32.1)
NET INCOME AVAILABLE TO
COMMON SHAREHOLDERS $307,333 $412,638 ($105,305) (25.5)
Net interest income
- FTE (1) $1,175,679 $1,219,243 ($43,564) (3.6)
Net income per average
common share
Diluted 0.88 1.18 (0.30) (25.4)
Basic 0.88 1.19 (0.31) (26.1)
Cash dividends declared per
common share 0.77 0.73 0.04 5.5
Average common shares
outstanding (000s)
Diluted 350,970 349,592 1,378 0.4
Basic 349,916 346,150 3,766 1.1
Nine Months Ended
September 30 Increase/(Decrease)(2)
2008 2007 Amount %
Interest income $6,342,011 $7,587,219 ($1,245,208) (16.4) %
Interest expense 2,899,215 4,035,188 (1,135,973) (28.2)
NET INTEREST INCOME 3,442,796 3,552,031 (109,235) (3.1)
Provision for loan losses 1,511,721 308,141 1,203,580 NM
NET INTEREST INCOME AFTER
PROVISION FOR LOAN LOSSES 1,931,075 3,243,890 (1,312,815) (40.5)
NONINTEREST INCOME
Service charges on deposit
accounts 682,376 599,818 82,558 13.8
Trust and investment
management income 465,898 514,180 (48,282) (9.4)
Retail investment services 218,855 206,392 12,463 6.0
Other charges and fees 385,588 357,225 28,363 7.9
Investment banking income 178,571 159,844 18,727 11.7
Trading account
profits/(losses) and
commissions 100,048 75,451 24,597 32.6
Card fees 230,465 203,225 27,240 13.4
Mortgage production
related income 199,085 68,617 130,468 NM
Mortgage servicing related
income 124,300 138,072 (13,772) (10.0)
Gain on sale of businesses 200,851 32,340 168,511 NM
Gain on Visa IPO 86,305 - 86,305 NM
Net gain on sale/leaseback
of premises 37,039 - 37,039 NM
Other noninterest income 184,106 260,080 (75,974) (29.2)
Securities gains/(losses),
net 662,247 237,423 424,824 NM
Total noninterest income 3,755,734 2,852,667 903,067 31.7
NONINTEREST EXPENSE
Employee compensation and
benefits 2,123,250 2,087,378 35,872 1.7
Net occupancy expense 260,669 258,533 2,136 0.8
Outside processing and
software 348,731 305,538 43,193 14.1
Equipment expense 155,317 154,764 553 0.4
Marketing and customer
development 320,599 135,928 184,671 NM
Amortization/impairment of
intangible assets 104,001 73,266 30,735 41.9
Net loss on extinguishment
of debt 11,723 9,800 1,923 19.6
Visa litigation (19,124) - (19,124) NM
Operating losses 210,100 91,213 118,887 NM
Other noninterest expense 786,497 662,016 124,481 18.8
Total noninterest
expense 4,301,763 3,778,436 523,327 13.9
INCOME BEFORE PROVISION/
(BENEFIT) FOR INCOME TAXES 1,385,046 2,318,121 (933,075) (40.3)
Provision/(Benefit) for
income taxes 241,685 695,230 (453,545) (65.2)
Net income 1,143,361 1,622,891 (479,530) (29.5)
Preferred dividends 17,200 22,408 (5,208) (23.2)
NET INCOME AVAILABLE TO
COMMON SHAREHOLDERS $1,126,161 $1,600,483 ($474,322) (29.6)
Net interest income
- FTE (1) $3,528,493 $3,627,467 ($98,974) (2.7)
Net income per average
common share
Diluted 3.22 4.52 (1.30) (28.8)
Basic 3.23 4.57 (1.34) (29.3)
Cash dividends declared
per common share 2.31 2.19 0.12 5.5
Average common shares
outstanding (000s)
Diluted 349,613 354,244 (4,631) (1.3)
Basic 348,409 350,501 (2,092) (0.6)
(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.
SunTrust Banks, Inc. and Subsidiaries
FIVE QUARTER CONSOLIDATED STATEMENTS OF INCOME
(Dollars in thousands, except per share data) (Unaudited)
Three Months Ended
Sept. 30 June 30 March 31 Dec. 31 Sept. 30
2008 2008 2008 2007 2007
Interest income $2,017,314 $2,066,365 $2,258,332 $2,448,701 $2,515,292
Interest expense 871,101 909,649 1,118,465 1,281,188 1,323,104
NET INTEREST INCOME 1,146,213 1,156,716 1,139,867 1,167,513 1,192,188
Provision for loan
losses 503,672 448,027 560,022 356,781 147,020
NET INTEREST INCOME
AFTER PROVISION
FOR LOAN LOSSES 642,541 708,689 579,845 810,732 1,045,168
NONINTEREST INCOME
Service charges on
deposit accounts 240,241 230,296 211,839 222,213 213,939
Trust and investment
management income 147,477 157,319 161,102 170,854 175,242
Retail investment
services 72,791 73,764 72,300 71,650 71,064
Other charges and
fees 128,776 129,581 127,231 121,849 120,730
Investment banking
income 62,164 60,987 55,420 55,041 47,688
Trading account
profits/(losses)
and commissions 121,136 (49,306) 28,218 (437,162) (31,187)
Card fees 78,138 78,566 73,761 77,481 70,450
Mortgage production
related income 50,028 63,508 85,549 22,366 12,950
Mortgage servicing
related income 62,654 32,548 29,098 57,364 57,142
Gain on sale of
businesses 81,813 29,648 89,390 - -
Gain on Visa IPO - - 86,305 - -
Net gain on sale/
leaseback of
premises - - 37,039 118,840 -
Other noninterest
income 66,958 56,312 60,836 89,827 80,130
Securities gains/
(losses), net 173,046 549,787 (60,586) 5,694 991
Total
noninterest
income 1,285,222 1,413,010 1,057,502 576,017 819,139
NONINTEREST EXPENSE
Employee
compensation and
benefits 696,210 711,957 715,083 682,810 677,765
Net occupancy
expense 88,745 85,483 86,441 92,705 87,626
Outside processing
and software 132,361 107,205 109,165 105,407 105,132
Equipment expense 51,931 50,991 52,395 51,734 51,532
Marketing and
customer
development 217,693 47,203 55,703 59,115 46,897
Amortization/
impairment of
intangible assets 18,551 64,735 20,715 23,414 24,820
Net loss on
extinguishment of
debt - - 11,723 - 9,800
Visa litigation 20,000 - (39,124) 76,930 -
Operating losses 135,183 44,654 30,263 42,815 52,041
Other noninterest
expense 307,412 266,305 212,780 320,411 235,632
Total
noninterest
expense 1,668,086 1,378,533 1,255,144 1,455,341 1,291,245
INCOME/(LOSS) BEFORE
PROVISION/(BENEFIT)
FOR INCOME TAXES 259,677 743,166 382,203 (68,592) 573,062
Provision/(Benefit)
for income taxes (52,767) 202,804 91,648 (79,716) 152,898
Net income 312,444 540,362 290,555 11,124 420,164
Preferred dividends 5,111 5,112 6,977 7,867 7,526
NET INCOME AVAILABLE
TO COMMON
SHAREHOLDERS $307,333 $535,250 $283,578 $3,257 $412,638
Net interest
income - FTE (1) $1,175,679 $1,184,972 $1,167,842 $1,194,757 $1,219,243
Net income per
average common
share
Diluted 0.88 1.53 0.81 0.01 1.18
Basic 0.88 1.53 0.82 0.01 1.19
Cash dividends
declared per common
share 0.77 0.77 0.77 0.73 0.73
Average common shares
outstanding (000s)
Diluted 350,970 349,783 348,072 348,072 349,592
Basic 349,916 348,714 346,581 345,917 346,150
(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.
SunTrust Banks, Inc. and Subsidiaries
CONSOLIDATED BALANCE SHEETS
(Dollars in thousands) (Unaudited)
As of September 30 Increase/(Decrease)(3)
2008 2007 Amount %
ASSETS
Cash and due from banks $3,065,268 $4,162,456 ($1,097,188) (26.4)%
Interest-bearing deposits
in other banks 65,025 29,684 35,341 NM
Funds sold and securities
purchased under agreements
to resell 1,440,234 968,553 471,681 48.7
Trading assets 8,936,540 9,566,806 (630,266) (6.6)
Securities available for
sale (1) 14,533,075 15,243,133 (710,058) (4.7)
Loans held for sale 4,759,761 8,675,427 (3,915,666) (45.1)
Loans:
Commercial 40,084,729 34,969,714 5,115,015 14.6
Real estate:
Home equity lines 16,159,053 14,598,774 1,560,279 10.7
Construction 11,519,497 14,358,990 (2,839,493) (19.8)
Residential mortgages 32,382,111 31,603,884 778,227 2.5
Commercial real estate 13,841,995 12,487,309 1,354,686 10.8
Consumer:
Direct 4,930,531 4,419,290 511,241 11.6
Indirect 6,796,898 7,642,099 (845,201) (11.1)
Credit card 1,003,581 668,353 335,228 50.2
Total loans 126,718,395 120,748,413 5,969,982 4.9
Allowance for loan and
lease losses (1,941,000) (1,093,691) 847,309 77.5
Net loans 124,777,395 119,654,722 5,122,673 4.3
Goodwill 7,062,869 6,912,110 150,759 2.2
Other intangible assets 1,389,965 1,327,060 62,905 4.7
Other real estate owned 387,037 156,106 230,931 NM
Other assets 8,359,591 9,161,172 (801,581) (8.7)
Total assets (2) $174,776,760 $175,857,229 ($1,080,469) (0.6)
LIABILITIES
Noninterest-bearing
consumer and commercial
deposits $21,487,853 $20,857,240 $630,613 3.0%
Interest-bearing
consumer and commercial
deposits:
NOW accounts 20,313,035 20,319,435 (6,400) -
Money market accounts 27,654,355 24,011,524 3,642,831 15.2
Savings 3,568,831 4,376,155 (807,324) (18.4)
Consumer time 16,566,225 17,037,866 (471,641) (2.8)
Other time 12,238,642 12,231,832 6,810 0.1
Total consumer
and commercial
deposits 101,828,941 98,834,052 2,994,889 3.0
Brokered deposits 9,141,001 14,188,886 (5,047,885) (35.6)
Foreign deposits 4,941,939 2,836,775 2,105,164 74.2
Total deposits 115,911,881 115,859,713 52,168 -
Funds purchased 2,388,629 1,512,054 876,575 58.0
Securities sold under
agreements to repurchase 4,090,085 5,548,486 (1,458,401) (26.3)
Other short-term
borrowings 2,728,307 2,971,761 (243,454) (8.2)
Long-term debt 23,857,828 22,661,381 1,196,447 5.3
Trading liabilities 1,924,013 1,906,002 18,011 0.9
Other liabilities 5,919,992 7,490,585 (1,570,593) (21.0)
Total liabilities 156,820,735 157,949,982 (1,129,247) (0.7)
SHAREHOLDERS' EQUITY
Preferred stock, no par
value 500,000 500,000 - -
Common stock, $1.00 par
value 372,799 370,578 2,221 0.6
Additional paid in capital 6,783,976 6,709,002 74,974 1.1
Retained earnings 10,959,830 10,897,059 62,771 0.6
Treasury stock, at cost,
and other (1,548,870) (1,821,360) (272,490) (15.0)
Accumulated other
comprehensive income,
net of tax 888,290 1,251,968 (363,678) (29.0)
Total shareholders'
equity 17,956,025 17,907,247 48,778 0.3
Total liabilities
and shareholders'
equity $174,776,760 $175,857,229 ($1,080,469) (0.6)
Common shares
outstanding 353,962,785 348,073,971 5,888,814 1.7
Common shares
authorized 750,000,000 750,000,000 - -
Preferred shares
outstanding 5,000 5,000 - -
Preferred shares
authorized 50,000,000 50,000,000 - -
Treasury shares of
common stock 18,836,584 22,504,427 (3,667,843) (16.3)
-----------------------------
(1) Includes net
unrealized gains of $1,519,449 $2,391,606 ($872,157) (36.5)%
(2) Includes earning
assets of 152,903,782 151,228,575 1,675,207 1.1
(3) "NM" - Not meaningful. Those changes over 100 percent were not
considered to be meaningful.
SunTrust Banks, Inc. and Subsidiaries
FIVE QUARTER CONSOLIDATED BALANCE SHEETS
(Dollars in thousands) (Unaudited)
As of
September 30 June 30 March 31
2008 2008 2008
ASSETS
Cash and due from banks $3,065,268 $3,564,824 $3,994,267
Interest-bearing deposits in
other banks 65,025 22,566 21,283
Funds sold and securities
purchased under agreements to
resell 1,440,234 1,920,276 1,247,495
Trading assets 8,936,540 10,147,021 10,932,251
Securities available for sale 1 14,533,075 15,118,073 15,882,088
Loans held for sale 4,759,761 5,260,892 6,977,289
Loans:
Commercial 40,084,729 38,800,537 37,306,872
Real estate:
Home equity lines 16,159,053 15,726,998 15,134,297
Construction 11,519,497 12,542,775 12,980,917
Residential mortgages 32,382,111 32,509,029 33,092,433
Commercial real estate 13,841,995 13,693,933 12,893,708
Consumer:
Direct 4,930,531 4,528,576 4,192,168
Indirect 6,796,898 7,077,510 7,305,213
Credit card 1,003,581 945,446 807,587
Total loans 126,718,395 125,824,804 123,713,195
Allowance for loan and lease
losses (1,941,000) (1,829,400) (1,545,340)
Net loans 124,777,395 123,995,404 122,167,855
Goodwill 7,062,869 7,056,015 6,923,033
Other intangible assets 1,389,965 1,442,056 1,430,268
Other real estate owned 387,037 334,519 244,906
Other assets 8,359,591 8,371,081 9,166,212
Total assets(2) $174,776,760 $177,232,727 $178,986,947
LIABILITIES
Noninterest-bearing consumer and
commercial deposits $21,487,853 $22,184,774 $22,325,750
Interest-bearing consumer and
commercial deposits:
NOW accounts 20,313,035 21,612,407 22,292,330
Money market accounts 27,654,355 26,016,859 25,843,396
Savings 3,568,831 3,990,277 3,990,007
Consumer time 16,566,225 16,582,510 16,876,836
Other time 12,238,642 12,046,718 12,104,125
Total consumer and
commercial deposits 101,828,941 102,433,545 103,432,444
Brokered deposits 9,141,001 12,607,183 11,034,332
Foreign deposits 4,941,939 4,538,435 1,712,504
Total deposits 115,911,881 119,579,163 116,179,280
Funds purchased 2,388,629 3,063,696 3,795,641
Securities sold under agreements
to repurchase 4,090,085 5,156,986 5,446,204
Other short-term borrowings 2,728,307 2,682,808 3,061,003
Long-term debt 23,857,828 21,327,576 23,602,919
Trading liabilities 1,924,013 2,430,521 2,356,037
Other liabilities 5,919,992 5,084,825 6,114,415
Total liabilities 156,820,735 159,325,575 160,555,499
SHAREHOLDERS' EQUITY
Preferred stock, no par value 500,000 500,000 500,000
Common stock, $1.00 par value 372,799 372,799 370,578
Additional paid in capital 6,783,976 6,799,935 6,682,828
Retained earnings 10,959,830 10,924,650 10,661,250
Treasury stock, at cost, and
other (1,548,870) (1,612,167) (1,692,117)
Accumulated other comprehensive
income, net of tax 888,290 921,935 1,908,909
Total shareholders' equity 17,956,025 17,907,152 18,431,448
Total liabilities and
shareholders' equity $174,776,760 $177,232,727 $178,986,947
Common shares outstanding 353,962,785 353,542,105 349,832,264
Common shares authorized 750,000,000 750,000,000 750,000,000
Preferred shares
outstanding 5,000 5,000 5,000
Preferred shares authorized 50,000,000 50,000,000 50,000,000
Treasury shares of common
stock 18,836,584 19,257,264 20,746,134
----------------------
(1) Includes net unrealized
gains of $1,519,449 $1,655,504 $2,835,823
(2) Includes earning assets of 152,903,782 154,716,384 152,714,700
As of
December 31 September 30
2007 2007
ASSETS
Cash and due from banks $4,270,917 $4,162,456
Interest-bearing deposits in other banks 24,355 29,684
Funds sold and securities purchased
under agreements to resell 1,347,329 968,553
Trading assets 10,518,379 9,566,806
Securities available for sale 1 16,264,107 15,243,133
Loans held for sale 8,851,695 8,675,427
Loans:
Commercial 35,929,400 34,969,714
Real estate:
Home equity lines 14,911,598 14,598,774
Construction 13,776,651 14,358,990
Residential mortgages 32,779,744 31,603,884
Commercial real estate 12,609,543 12,487,309
Consumer:
Direct 3,963,869 4,419,290
Indirect 7,494,130 7,642,099
Credit card 854,059 668,353
Total loans 122,318,994 120,748,413
Allowance for loan and lease losses (1,282,504) (1,093,691)
Net loans 121,036,490 119,654,722
Goodwill 6,921,493 6,912,110
Other intangible assets 1,362,995 1,327,060
Other real estate owned 183,753 156,106
Other assets 8,792,420 9,161,172
Total assets (2) $179,573,933 $175,857,229
LIABILITIES
Noninterest-bearing consumer and
commercial deposits $21,083,234 $20,857,240
Interest-bearing consumer and
commercial deposits:
NOW accounts 22,558,374 20,319,435
Money market accounts 24,522,640 24,011,524
Savings 3,917,099 4,376,155
Consumer time 17,264,208 17,037,866
Other time 12,524,470 12,231,832
Total consumer and
commercial deposits 101,870,025 98,834,052
Brokered deposits 11,715,024 14,188,886
Foreign deposits 4,257,601 2,836,775
Total deposits 117,842,650 115,859,713
Funds purchased 3,431,185 1,512,054
Securities sold under agreements to
repurchase 5,748,277 5,548,486
Other short-term borrowings 3,021,358 2,971,761
Long-term debt 22,956,508 22,661,381
Trading liabilities 2,160,385 1,906,002
Other liabilities 6,361,052 7,490,585
Total liabilities 161,521,415 157,949,982
SHAREHOLDERS' EQUITY
Preferred stock, no par value 500,000 500,000
Common stock, $1.00 par value 370,578 370,578
Additional paid in capital 6,707,293 6,709,002
Retained earnings 10,646,640 10,897,059
Treasury stock, at cost, and other (1,779,142) (1,821,360)
Accumulated other comprehensive
income, net of tax 1,607,149 1,251,968
Total shareholders' equity 18,052,518 17,907,247
Total liabilities and
shareholders' equity $179,573,933 $175,857,229
Common shares outstanding 348,411,163 348,073,971
Common shares authorized 750,000,000 750,000,000
Preferred shares outstanding 5,000 5,000
Preferred shares authorized 50,000,000 50,000,000
Treasury shares of common stock 22,167,235 22,504,427
----------------------
(1) Includes net unrealized gains of $2,724,643 $2,391,606
(2) Includes earning assets of 154,397,231 151,228,575
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
September 30, 2008
Interest
Average Income/ Yields/
Balances Expense Rates
ASSETS
Loans:
Real estate 1-4 family $31,486.5 $494.0 6.28 %
Real estate construction 10,501.9 130.0 4.92
Real estate home equity lines 15,424.4 193.0 4.98
Real estate commercial 14,138.6 193.4 5.44
Commercial - FTE (1) 38,064.4 508.5 5.32
Credit card 859.7 9.4 4.36
Consumer - direct 4,705.0 62.9 5.32
Consumer - indirect 7,152.3 114.0 6.34
Nonaccrual and restructured 3,309.2 7.4 0.88
Total loans 125,642.0 1,712.6 5.42
Securities available for sale:
Taxable 11,944.2 174.4 5.84
Tax-exempt - FTE (1) 1,017.2 15.5 6.07
Total securities available for
sale - FTE (1) 12,961.4 189.9 5.86
Funds sold and securities purchased
under agreements to resell 1,649.7 7.5 1.79
Loans held for sale 4,459.3 65.0 5.82
Interest-bearing deposits 28.0 0.2 2.81
Interest earning trading assets 7,579.4 71.6 3.76
Total earning assets 152,319.8 2,046.8 5.35
Allowance for loan and lease losses (2,035.8)
Cash and due from banks 2,918.1
Other assets 17,120.7
Noninterest earning trading assets 2,039.3
Unrealized gains on securities
available for sale, net 1,526.4
Total assets $173,888.5
LIABILITIES AND SHAREHOLDERS' EQUITY
Interest-bearing deposits:
NOW accounts $20,501.5 $55.9 1.08%
Money market accounts 26,897.1 122.5 1.81
Savings 3,770.9 3.8 0.40
Consumer time 16,282.1 144.2 3.52
Other time 11,868.3 106.8 3.58
Total interest-bearing consumer
and commercial deposits 79,319.9 433.2 2.17
Brokered deposits 10,693.5 90.8 3.32
Foreign deposits 5,106.3 21.9 1.68
Total interest-bearing deposits 95,119.7 545.9 2.28
Funds purchased 2,658.5 12.3 1.80
Securities sold under agreements to
repurchase 4,971.7 19.1 1.50
Interest-bearing trading liabilities 994.5 8.8 3.53
Other short-term borrowings 2,521.0 11.2 1.77
Long-term debt 22,419.4 273.8 4.86
Total interest-bearing liabilities 128,684.8 871.1 2.69
Noninterest-bearing deposits 20,879.9
Other liabilities 4,961.1
Noninterest-bearing trading liabilities 1,380.8
Shareholders' equity 17,981.9
Total liabilities and shareholders'
equity $173,888.5
Interest Rate Spread 2.66%
Net Interest Income - FTE (1) $1,175.7
Net Interest Margin (2) 3.07%
Three Months Ended
June 30, 2008
Interest
Average Income/ Yields/
Balances Expense Rates
ASSETS
Loans:
Real estate 1-4 family $32,113.4 $507.0 6.32%
Real estate construction 11,471.9 149.5 5.24
Real estate home equity lines 14,980.1 195.8 5.26
Real estate commercial 13,876.7 192.8 5.59
Commercial - FTE (1) 37,600.1 501.4 5.36
Credit card 816.0 5.4 2.62
Consumer - direct 4,382.4 63.4 5.82
Consumer - indirect 7,437.2 115.9 6.27
Nonaccrual and restructured 2,514.1 7.5 1.20
Total loans 125,191.9 1,738.7 5.59
Securities available for sale:
Taxable 11,769.6 186.0 6.32
Tax-exempt - FTE (1) 1,057.5 16.0 6.05
Total securities available for
sale - FTE (1) 12,827.1 202.0 6.30
Funds sold and securities purchased
under agreements to resell 1,331.1 6.7 2.00
Loans held for sale 5,148.5 72.5 5.63
Interest-bearing deposits 21.4 0.2 3.77
Interest earning trading assets 7,963.0 74.5 3.76
Total earning assets 152,483.0 2,094.6 5.52
Allowance for loan and lease losses (1,828.7)
Cash and due from banks 3,070.1
Other assets 17,186.1
Noninterest earning trading assets 2,342.4
Unrealized gains on securities
available for sale, net 2,295.9
Total assets $175,548.8
LIABILITIES AND SHAREHOLDERS' EQUITY
Interest-bearing deposits:
NOW accounts $21,762.4 $62.5 1.15%
Money market accounts 26,031.8 116.7 1.80
Savings 3,939.1 3.9 0.40
Consumer time 16,726.7 165.2 3.97
Other time 11,921.1 118.8 4.01
Total interest-bearing consumer
and commercial deposits 80,381.1 467.1 2.34
Brokered deposits 11,135.4 93.4 3.32
Foreign deposits 3,932.9 19.3 1.95
Total interest-bearing deposits 95,449.4 579.8 2.44
Funds purchased 2,792.5 13.5 1.92
Securities sold under agreements to
repurchase 5,388.4 21.8 1.60
Interest-bearing trading liabilities 849.2 6.6 3.12
Other short-term borrowings 2,650.6 13.1 1.99
Long-term debt 22,298.6 274.8 4.96
Total interest-bearing liabilities 129,428.7 909.6 2.83
Noninterest-bearing deposits 21,345.9
Other liabilities 5,162.4
Noninterest-bearing trading liabilities 1,518.6
Shareholders' equity 18,093.2
Total liabilities and shareholders'
equity $175,548.8
Interest Rate Spread 2.69%
Net Interest Income - FTE (1) $1,185.0
Net Interest Margin (2) 3.13%
(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.
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
March 31, 2008
Interest
Average Income/ Yields/
Balances Expense Rates
ASSETS
Loans:
Real estate 1-4 family $32,440.0 $521.3 6.43%
Real estate construction 12,450.2 189.8 6.13
Real estate home equity lines 14,603.0 234.3 6.45
Real estate commercial 13,113.1 201.3 6.17
Commercial - FTE (1) 36,374.6 539.2 5.96
Credit card 774.4 2.9 1.52
Consumer - direct 4,063.4 62.5 6.19
Consumer - indirect 7,645.3 120.2 6.32
Nonaccrual and restructured 1,799.0 5.4 1.21
Total loans 123,263.0 1,876.9 6.12
Securities available for sale:
Taxable 12,087.1 186.8 6.18
Tax-exempt - FTE (1) 1,071.4 16.5 6.13
Total securities available for
sale - FTE (1) 13,158.5 203.3 6.18
Funds sold and securities purchased
under agreements to resell 1,326.9 8.9 2.67
Loans held for sale 6,865.7 99.0 5.77
Interest-bearing deposits 21.9 0.2 4.54
Interest earning trading assets 8,367.6 98.0 4.71
Total earning assets 153,003.6 2,286.3 6.01
Allowance for loan and lease losses (1,393.1)
Cash and due from banks 3,166.5
Other assets 17,076.4
Noninterest earning trading assets 2,609.5
Unrealized gains on securities
available for sale, net 2,454.0
Total assets $176,916.9
LIABILITIES AND SHAREHOLDERS' EQUITY
Interest-bearing deposits:
NOW accounts $21,981.1 $101.9 1.87%
Money market accounts 25,342.7 154.7 2.46
Savings 3,917.0 5.7 0.59
Consumer time 17,030.8 187.8 4.43
Other time 12,280.5 141.1 4.62
Total interest-bearing consumer
and commercial deposits 80,552.1 591.2 2.95
Brokered deposits 11,216.4 123.0 4.34
Foreign deposits 4,252.2 33.6 3.13
Total interest-bearing deposits 96,020.7 747.8 3.13
Funds purchased 2,885.7 21.9 3.00
Securities sold under agreements to
repurchase 5,889.4 35.1 2.36
Interest-bearing trading liabilities 713.0 6.0 3.41
Other short-term borrowings 2,887.6 22.8 3.17
Long-term debt 22,808.3 284.9 5.02
Total interest-bearing liabilities 131,204.7 1,118.5 3.43
Noninterest-bearing deposits 20,616.3
Other liabilities 5,347.4
Noninterest-bearing trading liabilities 1,686.8
Shareholders' equity 18,061.7
Total liabilities and shareholders'
equity $176,916.9
Interest Rate Spread 2.58%
Net Interest Income - FTE (1) $1,167.8
Net Interest Margin (2) 3.07%
Three Months Ended
December 31, 2007
Interest
Average Income/ Yields/
Balances Expense Rates
ASSETS
Loans:
Real estate 1-4 family $31,990.3 $517.4 6.47%
Real estate construction 13,250.9 238.8 7.15
Real estate home equity lines 14,394.8 268.1 7.39
Real estate commercial 12,891.6 221.2 6.81
Commercial - FTE (1) 34,879.3 564.9 6.43
Credit card 690.1 2.1 1.23
Consumer - direct 3,949.3 70.7 7.10
Consumer - indirect 7,877.3 125.7 6.33
Nonaccrual and restructured 1,170.7 4.3 1.45
Total loans 121,094.3 2,013.2 6.60
Securities available for sale:
Taxable 11,814.6 182.9 6.19
Tax-exempt - FTE (1) 1,054.0 16.0 6.07
Total securities available for
sale - FTE (1) 12,868.6 198.9 6.18
Funds sold and securities purchased
under agreements to resell 1,066.1 11.6 4.25
Loans held for sale 8,777.6 139.2 6.34
Interest-bearing deposits 18.2 0.3 6.22
Interest earning trading assets 7,716.2 112.8 5.80
Total earning assets 151,541.0 2,476.0 6.48
Allowance for loan and lease losses (1,114.9)
Cash and due from banks 3,462.6
Other assets 17,172.3
Noninterest earning trading assets 1,660.9
Unrealized gains on securities
available for sale, net 2,408.6
Total assets $175,130.5
LIABILITIES AND SHAREHOLDERS' EQUITY
Interest-bearing deposits:
NOW accounts $20,737.2 $121.0 2.32%
Money market accounts 24,261.5 177.7 2.91
Savings 4,177.7 11.1 1.05
Consumer time 17,170.7 197.2 4.56
Other time 12,353.3 151.5 4.87
Total interest-bearing consumer
and commercial deposits 78,700.4 658.5 3.32
Brokered deposits 12,771.1 168.2 5.15
Foreign deposits 2,945.9 32.6 4.33
Total interest-bearing deposits 94,417.4 859.3 3.61
Funds purchased 2,151.4 24.1 4.38
Securities sold under agreements to
repurchase 5,706.7 55.2 3.78
Interest-bearing trading liabilities 504.2 3.5 2.75
Other short-term borrowings 3,202.8 37.4 4.63
Long-term debt 22,808.1 301.7 5.25
Total interest-bearing liabilities 128,790.6 1,281.2 3.95
Noninterest-bearing deposits 20,948.1
Other liabilities 5,812.5
Noninterest-bearing trading liabilities 1,546.5
Shareholders' equity 18,032.8
Total liabilities and
shareholders' equity $175,130.5
Interest Rate Spread 2.53%
Net Interest Income - FTE (1) $1,194.8
Net Interest Margin (2) 3.13%
Three Months Ended
September 30, 2007
Interest
Average Income/ Yields/
Balances Expense Rates
ASSETS
Loans:
Real estate 1-4 family $31,003.5 $498.5 6.43%
Real estate construction 13,686.6 260.0 7.54
Real estate home equity lines 14,133.1 279.5 7.85
Real estate commercial 12,759.3 225.3 7.01
Commercial - FTE (1) 34,247.9 562.6 6.52
Credit card 516.3 4.2 3.29
Consumer - direct 4,368.0 80.0 7.26
Consumer - indirect 7,966.4 124.6 6.21
Nonaccrual and restructured 877.5 3.8 1.72
Total loans 119,558.6 2,038.5 6.76
Securities available for sale:
Taxable 11,546.2 179.7 6.23
Tax-exempt - FTE (1) 1,040.9 15.8 6.05
Total securities available for
sale - FTE (1) 12,587.1 195.5 6.21
Funds sold and securities purchased
under agreements to resell 872.5 11.1 4.99
Loans held for sale 9,748.0 155.6 6.39
Interest-bearing deposits 24.9 0.3 4.28
Interest earning trading assets 9,536.5 141.2 5.88
Total earning assets 152,327.6 2,542.2 6.62
Allowance for loan and lease losses (1,059.1)
Cash and due from banks 3,417.2
Other assets 16,719.9
Noninterest earning trading assets 1,155.9
Unrealized gains on securities
available for sale, net 2,091.9
Total assets $174,653.4
LIABILITIES AND SHAREHOLDERS' EQUITY
Interest-bearing deposits:
NOW accounts $19,543.4 $117.9 2.39%
Money market accounts 22,560.3 160.0 2.81
Savings 4,456.5 13.3 1.19
Consumer time 16,839.9 193.4 4.56
Other time 11,862.4 146.3 4.89
Total interest-bearing consumer
and commercial deposits 75,262.5 630.9 3.33
Brokered deposits 15,806.3 214.6 5.31
Foreign deposits 5,333.6 68.8 5.05
Total interest-bearing deposits 96,402.4 914.3 3.76
Funds purchased 2,291.3 28.9 4.94
Securities sold under agreements to
repurchase 5,732.2 64.7 4.42
Interest-bearing trading liabilities 354.1 3.4 3.85
Other short-term borrowings 2,730.1 33.6 4.89
Long-term debt 21,143.5 278.1 5.22
Total interest-bearing liabilities 128,653.6 1,323.0 4.08
Noninterest-bearing deposits 21,445.1
Other liabilities 5,633.7
Noninterest-bearing trading liabilities 1,370.8
Shareholders' equity 17,550.2
Total liabilities and shareholders'
equity $174,653.4
Interest Rate Spread 2.54%
Net Interest Income - FTE (1) $1,219.2
Net Interest Margin (2) 3.18%
(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.
SunTrust Banks, Inc. and Subsidiaries
CONSOLIDATED DAILY AVERAGE BALANCES,
AVERAGE YIELDS EARNED AND RATES PAID
(Dollars in millions; yields on taxable-equivalent basis) (Unaudited)
Nine Months Ended
September 30, 2008
Interest
Average Income/ Yields/
Balances Expense Rates
ASSETS
Loans:
Real estate 1-4 family $32,011.4 $1,522.3 6.34%
Real estate construction 11,471.1 469.2 5.46
Real estate home equity lines 15,004.0 623.0 5.55
Real estate commercial 13,711.0 587.5 5.72
Commercial - FTE (1) 37,349.0 1,549.1 5.54
Credit card 816.9 17.7 2.88
Consumer - direct 4,384.8 188.9 5.75
Consumer - indirect 7,410.7 350.2 6.31
Nonaccrual and restructured 2,543.5 20.3 1.07
Total loans 124,702.4 5,328.2 5.71
Securities available for sale:
Taxable 11,933.6 547.2 6.11
Tax-exempt - FTE (1) 1,048.6 47.9 6.09
Total securities available for
sale - FTE (1) 12,982.2 595.1 6.11
Funds sold and securities purchased
under agreement to resell 1,436.7 23.2 2.12
Loans held for sale 5,487.4 236.4 5.74
Interest-bearing deposits 23.8 0.7 3.63
Interest earning trading assets 7,968.6 244.1 4.09
Total earning assets 152,601.1 6,427.7 5.63
Allowance for loan and lease losses (1,753.6)
Cash and due from banks 3,051.1
Other assets 17,127.7
Noninterest earning trading assets 2,329.3
Unrealized gains on securities
available for sale, net 2,090.1
Total assets $175,445.7
LIABILITIES AND SHAREHOLDERS' EQUITY
Interest-bearing deposits:
NOW accounts $21,411.7 $220.3 1.37%
Money market accounts 26,093.5 394.0 2.02
Savings 3,875.3 13.4 0.46
Consumer time 16,678.4 497.2 3.98
Other time 12,022.7 366.6 4.07
Total interest-bearing consumer
and commercial deposits 80,081.6 1,491.5 2.49
Brokered deposits 11,013.9 307.2 3.66
Foreign deposits 4,432.9 74.8 2.22
Total interest-bearing deposits 95,528.4 1,873.5 2.62
Funds purchased 2,778.4 47.6 2.25
Securities sold under agreements to
repurchase 5,414.9 76.0 1.84
Interest-bearing trading liabilities 852.8 21.5 3.36
Other short-term borrowings 2,685.8 47.1 2.34
Long-term debt 22,508.5 833.5 4.95
Total interest-bearing liabilities 129,768.8 2,899.2 2.98
Noninterest-bearing deposits 20,947.1
Other liabilities 5,156.2
Noninterest-bearing trading liabilities 1,528.2
Shareholders' equity 18,045.4
Total liabilities and shareholders'
equity $175,445.7
Interest Rate Spread 2.65%
Net Interest Income - FTE (1) $3,528.5
Net Interest Margin (2) 3.09%
Nine Months Ended
September 30, 2007
Interest
Average Income/ Yields/
Balances Expense Rates
ASSETS
Loans:
Real estate 1-4 family $31,937.7 $1,519.0 6.34%
Real estate construction 13,610.0 772.1 7.59
Real estate home equity lines 13,908.4 820.1 7.88
Real estate commercial 12,773.7 666.3 6.97
Commercial - FTE (1) 33,963.6 1,637.8 6.45
Credit card 430.4 15.6 4.83
Consumer - direct 4,312.5 234.2 7.26
Consumer - indirect 8,064.7 369.7 6.13
Nonaccrual and restructured 737.9 13.1 2.37
Total loans 119,738.9 6,047.9 6.75
Securities available for sale:
Taxable 9,755.0 456.1 6.23
Tax-exempt - FTE (1) 1,040.3 46.2 5.92
Total securities available for
sale - FTE (1) 10,795.3 502.3 6.20
Funds sold and securities purchased
under agreement to resell 971.8 37.3 5.05
Loans held for sale 11,463.8 529.8 6.16
Interest-bearing deposits 25.9 1.0 5.25
Interest earning trading assets 13,443.2 544.4 5.41
Total earning assets 156,438.9 7,662.7 6.55
Allowance for loan and lease losses (1,049.1)
Cash and due from banks 3,454.6
Other assets 16,541.5
Noninterest earning trading assets 1,043.2
Unrealized gains on securities
available for sale, net 2,264.5
Total assets $178,693.6
LIABILITIES AND SHAREHOLDERS' EQUITY
Interest-bearing deposits:
NOW accounts $19,808.7 $352.8 2.38%
Money market accounts 22,142.6 444.9 2.69
Savings 4,753.9 44.4 1.25
Consumer time 16,864.0 567.0 4.49
Other time 11,979.3 434.8 4.85
Total interest-bearing consumer
and commercial deposits 75,548.5 1,843.9 3.26
Brokered deposits 17,211.1 692.9 5.31
Foreign deposits 6,714.3 264.6 5.20
Total interest-bearing deposits 99,473.9 2,801.4 3.77
Funds purchased 3,641.9 142.4 5.15
Securities sold under agreements to
repurchase 6,276.0 218.6 4.59
Interest-bearing trading liabilities 405.3 12.1 3.99
Other short-term borrowings 2,253.9 83.7 4.96
Long-term debt 19,980.0 777.0 5.20
Total interest-bearing liabilities 132,031.0 4,035.2 4.09
Noninterest-bearing deposits 21,922.9
Other liabilities 5,773.1
Noninterest-bearing trading liabilities 1,234.3
Shareholders' equity 17,732.3
Total liabilities and shareholders'
equity $178,693.6
Interest Rate Spread 2.46%
Net Interest Income - FTE (1) $3,627.5
Net Interest Margin (2) 3.10%
(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.
SunTrust Banks, Inc. and Subsidiaries
OTHER FINANCIAL DATA
(Dollars in thousands) (Unaudited)
Three Months Ended
September 30 Increase/(Decrease)
2008 2007 Amount % (1)
CREDIT DATA
Allowance for loan and
lease losses - beginning $1,829,400 $1,050,362 $779,038 74.2%
Provision for loan losses 503,672 147,020 356,652 NM
Allowance associated with
loans at fair value (2) - - - -
Allowance from GB&T
acquisition - - - -
Charge-offs
Commercial (63,278) (39,487) 23,791 60.3
Real estate:
Home equity lines (119,162) (29,075) 90,087 NM
Construction (51,719) (2,477) 49,242 NM
Residential mortgages (133,510) (19,853) 113,657 NM
Commercial real estate (400) (789) (389) (49.3)
Consumer:
Direct (10,406) (5,661) 4,745 83.8
Indirect (41,249) (28,944) 12,305 42.5
Total charge-offs (419,724) (126,286) 293,438 NM
Recoveries
Commercial 5,432 6,322 (890) (14.1)
Real estate:
Home equity lines 3,903 2,101 1,802 85.8
Construction 1,786 82 1,704 NM
Residential mortgages 2,083 1,107 976 88.2
Commercial real estate 257 861 (604) (70.2)
Consumer:
Direct 1,700 2,108 (408) (19.4)
Indirect 12,491 10,014 2,477 24.7
Total recoveries 27,652 22,595 5,057 22.4
Net charge-offs (392,072) (103,691) 288,381 NM
Allowance for loan and
lease losses - ending $1,941,000 $1,093,691 $847,309 77.5
Net charge-offs to average
loans (annualized)
Commercial 0.59% 0.38% 0.21% 55.5%
Real estate:
Home equity lines 2.97 0.76 2.21 NM
Construction 1.73 0.07 1.66 NM
Residential mortgages 1.57 0.24 1.33 NM
Commercial real estate - - - -
Consumer:
Direct 0.74 0.32 0.42 NM
Indirect 1.56 0.94 0.62 66.4
Total net charge-offs to
total average loans 1.24 0.34 0.90 NM
Period Ended
Nonaccrual/nonperforming
loans
Commercial $257,343 $74,246 $183,097 NM%
Real estate:
Home equity lines 232,904 80,966 151,938 NM
Construction 1,040,678 158,194 882,484 NM
Residential mortgages 1,548,955 595,856 953,099 NM
Commercial real estate 164,906 40,649 124,257 NM
Consumer loans 44,732 24,880 19,851 79.8
Total nonaccrual/
nonperforming loans 3,289,518 974,791 2,314,727 NM
Other real estate owned
(OREO) 387,037 156,106 230,931 NM
Other repossessed assets 13,714 9,974 3,740 37.5
Total nonperforming assets $3,690,269 $1,140,871 $2,549,398 NM
Restructured loans
(accruing)(5) $381,040 $29,057 $351,983 NM
Total accruing loans past due
90 days or more $772,132 $495,384 $276,747 55.9%
Total nonperforming loans to
total loans 2.60% 0.81% 1.79% NM%
Total nonperforming assets to
total loans plus OREO and
other repossessed assets 2.90 0.94 1.96 NM
Allowance to period-end
loans (3) 1.54 0.91 0.63 69.2
Allowance to nonperforming
loans (4) 62.1 129.5 (67.4) (52.0)
Allowance to annualized net
charge-offs 1.24x 2.66x (1.42)x (53.6)
Nine Months Ended
September 30 Increase/(Decrease)
2008 2007 Amount % (1)
CREDIT DATA
Allowance for loan and
lease losses - beginning $1,282,504 $1,044,521 $237,983 22.8%
Provision for loan losses 1,511,721 308,141 1,203,580 NM
Allowance associated with
loans at fair value (2) - (4,100) 4,100 100.0
Allowance from GB&T
acquisition 158,705 - 158,705 NM
Charge-offs
Commercial (149,305) (102,620) 46,685 45.5
Real estate:
Home equity lines (312,621) (69,376) 243,245 NM
Construction (110,300) (4,543) 105,757 NM
Residential mortgages (368,751) (53,761) 314,990 NM
Commercial real estate (1,196) (1,770) (574) (32.4)
Consumer:
Direct (28,573) (16,879) 11,694 69.3
Indirect (127,239) (74,006) 53,233 71.9
Total charge-offs (1,097,985) (322,955) 775,030 NM
Recoveries
Commercial 18,423 17,629 794 4.5
Real estate:
Home equity lines 11,921 5,607 6,314 NM
Construction 2,046 445 1,601 NM
Residential mortgages 4,950 4,134 816 19.7
Commercial real estate 454 1,064 (610) (57.3)
Consumer:
Direct 6,200 7,129 (929) (13.0)
Indirect 42,061 32,076 9,985 31.1
Total recoveries 86,055 68,084 17,971 26.4
Net charge-offs (1,011,930) (254,871) 757,059 NM
Allowance for loan and
lease losses - ending $1,941,000 $1,093,691 $847,309 77.5
Net charge-offs to
average loans
(annualized)
Commercial 0.46% 0.33% 0.13% 38.2%
Real estate:
Home equity lines 2.68 0.61 2.07 NM
Construction 1.18 0.04 1.14 NM
Residential mortgages 1.46 0.20 1.26 NM
Commercial real estate 0.01 0.01 - -
Consumer:
Direct 0.68 0.30 0.38 NM
Indirect 1.52 0.69 0.83 NM
Total net charge-offs to
total average loans 1.08 0.28 0.80 NM
(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) 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 period
calculation were $131,514, which did not change the calculation by
more than one basis point as of September 30, 2007.
(4) 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 period calculation were
$129,962, which increased the calculation approximately 16 basis
points as of September 30, 2007.
(5) During the third quarter of 2008, the Company revised its definition
of nonperforming to exclude loans that have been restructured and
remain on accruing status. These loans are not considered to be
nonperforming because they are performing in accordance with the
restructured terms. This change better aligns the Company's
definition of nonperforming loans with the one used by peer
institutions and therefore improves comparability of this measure
across the industry.
SunTrust Banks, Inc. and Subsidiaries
FIVE QUARTER OTHER FINANCIAL DATA
(Dollars in thousands) (Unaudited)
Three Months Ended
September 30 June 30 Increase/(Decrease)
2008 2008 Amount % (1)
CREDIT DATA
Allowance for loan and
lease losses -
beginning $1,829,400 $1,545,340 $284,060 18.4%
Provision for loan
losses 503,672 448,027 55,645 12.4
Allowance from GB&T
acquisition - 158,705 (158,705) (100.0)
Charge-offs
Commercial (63,278) (47,738) 15,540 32.6
Real estate:
Home equity lines (119,162) (94,857) 24,305 25.6
Construction (51,719) (35,399) 16,320 46.1
Residential
mortgages (133,510) (126,055) 7,455 5.9
Commercial real
estate (400) (563) (163) (29.0)
Consumer:
Direct (10,406) (7,852) 2,554 32.5
Indirect (41,249) (43,101) (1,852) (4.3)
Total charge-offs (419,724) (355,565) 64,159 18.0
-
Recoveries
Commercial 5,432 7,255 (1,823) (25.1)
Real estate:
Home equity lines 3,903 5,650 (1,747) (30.9)
Construction 1,786 182 1,604 NM
Residential mortgages 2,083 1,644 439 26.7
Commercial real estate 257 35 222 NM
Consumer:
Direct 1,700 2,119 (419) (19.8)
Indirect 12,491 16,008 (3,517) (22.0)
Total recoveries 27,652 32,893 (5,241) (15.9)
Net charge-offs (392,072) (322,672) 69,400 21.5
Allowance for loan and
lease losses - ending $1,941,000 $1,829,400 $111,600 6.1
-
Net charge-offs to
average loans
(annualized)
Commercial 0.59% 0.42% 0.17% 39.9%
Real estate:
Home equity lines 2.97 2.40 0.57 23.9
Construction 1.73 1.16 0.57 48.8
Residential mortgages 1.57 1.49 0.08 5.6
Commercial real estate - 0.02 (0.02) (100.0)
Consumer:
Direct 0.74 0.53 0.21 38.9
Indirect 1.56 1.46 0.10 7.1
Total net charge-offs to
total average loans 1.24 1.04 0.20 19.2
-
Period Ended
Nonaccrual/nonperforming
loans
Commercial $257,343 $117,168 $140,175 NM%
Real estate:
Home equity lines 232,904 216,839 16,065 7.4
Construction 1,040,678 772,353 268,325 34.7
Residential
mortgages 1,548,955 1,356,710 192,245 14.2
Commercial real
estate 164,906 124,523 40,383 32.4
Consumer loans 44,732 37,735 6,996 18.5
Total nonaccrual/
nonperforming loans 3,289,518 2,625,328 664,190 25.3
Other real estate owned
(OREO) 387,037 334,519 52,518 15.7
Other repossessed
assets 13,714 13,203 511 3.9
Total nonperforming
assets $3,690,269 $2,973,050 $717,219 24.1
Restructured loans
(accruing)(4) $381,040 $163,358 $217,682 NM
Total accruing loans past
due 90 days or more $772,132 $753,558 $18,574 2.5%
Total nonperforming loans
to total loans 2.60% 2.09% 0.51% 24.4%
Total nonperforming assets
to total loans plus OREO
and other repossessed
assets 2.90 2.36 0.54 22.9
Allowance to period-end
loans (2) 1.54 1.46 0.08 5.5
Allowance to nonperforming
loans (3) 62.1 77.0 (14.9) (19.3)
Allowance to annualized
net charge-offs 1.24x 1.41x (0.17)x (11.7)
Three Months Ended
March 31 December 31 September 30
2008 2007 2007
CREDIT DATA
Allowance for loan and lease
losses - beginning $1,282,504 $1,093,691 $1,050,362
Provision for loan losses 560,022 356,781 147,020
Allowance from GB&T acquisition - - -
Charge-offs
Commercial (38,289) (38,239) (39,487)
Real estate:
Home equity lines (98,602) (46,842) (29,075)
Construction (23,182) (7,616) (2,477)
Residential mortgages (109,186) (59,319) (19,853)
Commercial real estate (233) (299) (789)
Consumer:
Direct (10,315) (6,630) (5,661)
Indirect (42,889) (32,448) (28,944)
Total charge-offs (322,696) (191,393) (126,286)
Recoveries
Commercial 5,736 6,613 6,322
Real estate:
Home equity lines 2,368 2,182 2,101
Construction 78 705 82
Residential mortgages 1,223 1,328 1,107
Commercial real estate 162 846 861
Consumer:
Direct 2,381 2,484 2,108
Indirect 13,562 9,267 10,014
Total recoveries 25,510 23,425 22,595
Net charge-offs (297,186) (167,968) (103,691)
Allowance for loan and lease
losses - ending $1,545,340 $1,282,504 $1,093,691
Net charge-offs to average loans
(annualized)
Commercial 0.35% 0.35% 0.38%
Real estate:
Home equity lines 2.65 1.23 0.76
Construction 0.72 0.20 0.07
Residential mortgages 1.29 0.70 0.24
Commercial real estate - (0.02) -
Consumer:
Direct 0.79 0.42 0.32
Indirect 1.53 1.16 0.94
Total net charge-offs to
total average loans 0.97 0.55 0.34
Period Ended
Nonaccrual/nonperforming loans
Commercial $97,930 $74,463 $74,246
Real estate:
Home equity lines 193,153 135,700 80,966
Construction 520,704 295,335 158,194
Residential mortgages 1,115,071 841,376 595,856
Commercial real estate 64,251 44,502 40,649
Consumer loans 46,851 39,031 24,880
Total nonaccrual/
nonperforming loans 2,037,960 1,430,407 974,791
Other real estate owned
(OREO) 244,906 183,753 156,106
Other repossessed assets 6,340 11,536 9,974
Total nonperforming assets $2,289,206 $1,625,696 $1,140,871
Restructured loans
(accruing)(4) $30,787 $29,851 $29,057
Total accruing loans past due
90 days or more $743,969 $611,003 $495,384
Total nonperforming loans to
total loans 1.65% 1.17% 0.81%
Total nonperforming assets to
total loans plus OREO and
other repossessed assets 1.85 1.33 0.94
Allowance to period-end
loans (2) 1.25 1.05 0.91
Allowance to nonperforming
loans (3) 82.9 101.9 129.5
Allowance to annualized net
charge-offs 1.29x 1.92x 2.66x
(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 and $131,514 as of March
31, 2008, December 31, 2007 and September 30, 2007, respectively,
which did not change the calculation by more than one basis point as
of March 31, 2008, December 31, 2007 and September 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 and $129,962 as of March 31, 2008, December
31, 2007 and September 30, 2007, respectively, which increased the
calculation approximately 7, 12 and 16 basis points as of March 31,
2008, December 31, 2007 and September 30, 2007, respectively.
(4) During the third quarter of 2008, the Company revised its definition
of nonperforming to exclude loans that have been restructured and
remain on accruing status. These loans are not considered to be
nonperforming because they are performing in accordance with the
restructured terms. This change better aligns the Company's
definition of nonperforming loans with the one used by peer
institutions and therefore improves comparability of this measure
across the industry.
ADD: /SECOND AND FINAL ADD -- CLTH032 -- SunTrust Banks, Inc./
SunTrust Banks, Inc. and Subsidiaries
OTHER FINANCIAL DATA (continued)
(Dollars and shares in thousands, except per share data) (Unaudited)
Three Months Ended
September 30
Core Mortgage
Deposit Servicing
Intangible Rights Other Total
OTHER INTANGIBLE ASSET
ROLLFORWARD
Balance, beginning of period $205,574 $942,012 $142,874 $1,290,460
Amortization (17,202) (45,329) (7,617) (70,148)
Mortgage Servicing Rights
("MSRs") originated - 161,962 - 161,962
Purchase of GenSpring
(formerly AMA, LLC) minority
shares - - 927 927
Intangible assets obtained
from sale upon merger of
Lighthouse Partners, net(1) - - - -
Client relationship intangible
obtained from GenSpring's
acquisition of TBK
Investments, Inc. - - 6,520 6,520
Sale of MSRs - (62,661) - (62,661)
Balance September 30, 2007 $188,372 $995,984 $142,704 $1,327,060
Balance, beginning of period $172,985 $1,193,450 $75,621 $1,442,056
Amortization (14,581) (51,469) (3,971) (70,021)
MSRs originated - 98,312 - 98,312
MSRs impairment reserve - - - -
MSRs impairment recovery - - - -
Sale of interest in Lighthouse
Partners - - - -
Sale of MSRs - (90,280) - (90,280)
Customer intangible impairment
charge - - - -
Purchased credit card
relationships - - 9,898 9,898
Acquisition of GB&T - - - -
Sale of First Mercantile - - - -
Balance September 30, 2008 $158,404 $1,150,013 $81,548 $1,389,965
Nine Months Ended
September 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 (53,242) (133,266) (20,024) (206,532)
Mortgage Servicing Rights
("MSRs") originated - 497,058 - 497,058
Purchase of GenSpring
(formerly AMA, LLC) minority
shares - - 2,205 2,205
Intangible assets obtained
from sale upon merger of
Lighthouse Partners, net(1) - - 24,142 24,142
Client relationship intangible
obtained from GenSpring's
acquisition of TBK
Investments, Inc. - - 6,520 6,520
Sale of MSRs - (178,317) - (178,317)
Balance September 30, 2007 $188,372 $995,984 $142,704 $1,327,060
Balance, beginning of period $172,655 $1,049,425 $140,915 $1,362,995
Amortization (43,761) (164,546) (15,240) (223,547)
MSRs originated - 396,590 - 396,590
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 of MSRs - (131,456) - (131,456)
Customer intangible impairment
charge - - (45,000) (45,000)
Purchased credit card
relationships - - 9,898 9,898
Acquisition of GB&T 29,510 - - 29,510
Sale of First Mercantile - - (3,033) (3,033)
Balance September 30, 2008 $158,404 $1,150,013 $81,548 $1,389,965
Three Months Ended
Sept. 30 June 30 March 31 Dec. 31 Sept. 30
2008 2008 2008 2007 2007
COMMON SHARE ROLLFORWARD
Beginning balance 353,542 349,832 348,411 348,074 349,053
Common shares
issued/exchanged for
employee benefit plans,
stock option, performance
and restricted stock
activity 421 1,489 1,421 337 483
Common shares issued for
acquisition of GB&T - 2,221 - - -
Acquisition of treasury stock - - - - (1,462)
Ending balance 353,963 353,542 349,832 348,411 348,074
COMMON STOCK REPURCHASE
ACTIVITY
Number of common shares
repurchased (2) - 2 17 12 1,472
Average price per share of
repurchased common shares $0.00 $57.76 $62.38 $69.31 $81.00
Total cost to acquire
treasury shares $- $- $- $- $-
Maximum number of common
shares that may yet be
purchased under plans or
programs (3) 30,000 30,000 30,000 30,000 30,000
(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. 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
September 30 June 30 March 31
2008 2008 2008
NON-GAAP MEASURES
PRESENTED IN THE EARNINGS
RELEASE
Net income $312,444 $540,362 $290,555
Securities (gains)/losses,
net of tax (107,289) (345,807) 37,563
Net income excluding net
securities (gains)/losses,
net of tax 205,155 194,555 328,118
The Coca-Cola Company
dividend, net of tax (10,146) (14,738) (14,738)
Net income/(loss)
excluding net securities
(gains)/losses and The
Coca-Cola Company
dividend 195,009 179,817 313,380
Less: Preferred dividends 5,111 5,112 6,977
Net income/(loss)
available to common
shareholders excluding
net securities (gains)/
losses and The Coca-Cola
Company dividend $189,898 $174,705 $306,403
Total average assets $173,888,490 $175,548,768 $176,916,901
Average net unrealized
securities gains (1,526,431) (2,295,932) (2,453,981)
Average assets less net
unrealized securities
gains $172,362,059 $173,252,836 $174,462,920
Total average common
shareholders' equity $17,481,916 $17,593,229 $17,561,709
Average accumulated other
comprehensive income (871,413) (1,488,305) (1,533,427)
Total average realized
common shareholders'
equity $16,610,503 $16,104,924 $16,028,282
Return on average total
assets 0.71 % 1.24 % 0.66 %
Impact of excluding net
realized and unrealized
securities (gains)/losses
and The Coca-Cola
Company dividend (0.26) (0.82) 0.06
Return on average total
assets less net
unrealized securities
gains (1) 0.45 % 0.42 % 0.72 %
Return on average common
shareholders' equity 6.99 % 12.24 % 6.49 %
Impact of excluding net
realized and unrealized
securities (gains)/
losses and The Coca-Cola
Company dividend (2.44) (7.88) 1.20
Return on average realized
common shareholders'
equity (2) 4.55 % 4.36 % 7.69 %
Efficiency ratio (3) 67.78 % 53.06 % 56.40 %
Impact of excluding
amortization/impairment
of intangible assets
other than MSRs (0.75) (2.49) (0.93)
Tangible efficiency
ratio (4) 67.03 % 50.57 % 55.47 %
Total shareholders' equity $17,956,025 $17,907,152 $18,431,448
Goodwill (7,062,869) (7,056,015) (6,923,033)
Other intangible assets
including MSRs (1,328,055) (1,394,941) (1,379,522)
MSRs 1,150,013 1,193,450 1,143,405
Tangible equity $10,715,114 $10,649,646 $11,272,298
Total assets $174,776,760 $177,232,727 $178,986,947
Goodwill (7,062,869) (7,056,015) (6,923,033)
Other intangible assets
including MSRs (1,389,965) (1,442,056) (1,430,268)
MSRs 1,150,013 1,193,450 1,143,405
Tangible assets $167,473,939 $169,928,106 $171,777,051
Tangible equity to
tangible assets (5) 6.40 % 6.27 % 6.56 %
Net interest income $1,146,213 $1,156,716 $1,139,867
Taxable-equivalent
adjustment 29,466 28,256 27,975
Net interest income - FTE 1,175,679 1,184,972 1,167,842
Noninterest income 1,285,222 1,413,010 1,057,502
Total revenue - FTE 2,460,901 2,597,982 2,225,344
Securities (gains)/losses,
net (173,046) (549,787) 60,586
Total revenue - FTE
excluding securities
(gains)/losses, net (6) $2,287,855 $2,048,195 $2,285,930
Three Months Ended
December 31 September 30
2007 2007
NON-GAAP MEASURES PRESENTED IN THE
EARNINGS RELEASE
Net income $11,124 $420,164
Securities (gains)/losses, net of tax (3,530) (614)
Net income excluding net securities
(gains)/losses, net of tax 7,594 419,550
The Coca-Cola Company dividend, net
of tax (13,206) (13,210)
Net income/(loss) excluding net
securities (gains)/losses and
The Coca-Cola Company dividend (5,612) 406,340
Less: Preferred dividends 7,867 7,526
Net income/(loss) available to common
shareholders excluding net
securities (gains)/losses and
The Coca-Cola Company dividend ($13,479) $398,814
Total average assets $175,130,464 $174,653,377
Average net unrealized securities
gains (2,408,596) (2,091,892)
Average assets less net unrealized
securities gains $172,721,868 $172,561,485
Total average common shareholders'
equity $17,532,786 $17,050,182
Average accumulated other
comprehensive income (1,292,785) (998,561)
Total average realized common
shareholders' equity $16,240,001 $16,051,621
Return on average total assets 0.03 % 0.95 %
Impact of excluding net realized and
unrealized securities (gains)/losses
and The Coca-Cola Company dividend (0.04) (0.02)
Return on average total assets less
net unrealized securities gains (1) (0.01)% 0.93 %
Return on average common
shareholders' equity 0.07 % 9.60 %
Impact of excluding net realized and
unrealized securities (gains)/
losses and The Coca-Cola Company
dividend (0.40) 0.26
Return on average realized common
shareholders' equity (2) (0.33)% 9.86 %
Efficiency ratio (3) 82.19 % 63.35 %
Impact of excluding
amortization/impairment of
intangible assets other than
MSRs (1.33) (1.22)
Tangible efficiency ratio (4) 80.86 % 62.13 %
Total shareholders' equity $18,052,518 $17,907,247
Goodwill (6,921,493) (6,912,110)
Other intangible assets including
MSRs (1,308,618) (1,269,052)
MSRs 1,049,426 995,984
Tangible equity $10,871,833 $10,722,069
Total assets $179,573,933 $175,857,229
Goodwill (6,921,493) (6,912,110)
Other intangible assets including
MSRs (1,362,995) (1,327,060)
MSRs 1,049,426 995,984
Tangible assets $172,338,871 $168,614,043
Tangible equity to tangible assets (5) 6.31 % 6.36 %
Net interest income $1,167,513 $1,192,188
Taxable-equivalent adjustment 27,244 27,055
Net interest income - FTE 1,194,757 1,219,243
Noninterest income 576,017 819,139
Total revenue - FTE 1,770,774 2,038,382
Securities (gains)/losses, net (5,694) (991)
Total revenue - FTE excluding
securities (gains)/losses, net (6) $1,765,080 $2,037,391
Nine Months Ended
September 30 September 30
2008 2007
NON-GAAP MEASURES PRESENTED IN THE
EARNINGS RELEASE
Net income $1,143,361 $1,622,891
Securities (gains)/losses, net of tax (410,593) (147,202)
Net income excluding net securities
(gains)/losses, net of tax 732,768 1,475,689
The Coca-Cola Company dividend, net
of tax (39,623) (41,009)
Net income/(loss) excluding net
securities (gains)/losses and
The Coca-Cola Company dividend 693,145 1,434,680
Less: Preferred dividends 17,200 22,408
Net income/(loss) available to common
shareholders excluding net securities
(gains)/losses and The Coca-Cola
Company dividend $675,945 $1,412,272
Total average assets $175,445,683 $178,693,630
Average net unrealized securities
gains (2,090,050) (2,264,501)
Average assets less net unrealized
securities gains $173,355,633 $176,429,129
Total average common shareholders'
equity $17,545,386 $17,232,264
Average accumulated other
comprehensive income (1,296,159) (1,092,903)
Total average realized common
shareholders' equity $16,249,227 $16,139,361
Return on average total assets 0.87 % 1.21 %
Impact of excluding net realized and
unrealized securities (gains)/losses
and The Coca-Cola Company dividend (0.34) (0.12)
Return on average total assets less
net unrealized securities gains (1) 0.53 % 1.09 %
Return on average common
shareholders' equity 8.57 % 12.42 %
Impact of excluding net realized and
unrealized securities (gains)/
losses and The Coca-Cola Company
dividend (3.01) (0.72)
Return on average realized common
shareholders' equity (2) 5.56 % 11.70 %
Efficiency ratio (3) 59.06 % 58.31 %
Impact of excluding
amortization/impairment of
intangible assets other than
MSRs (1.43) (1.13)
Tangible efficiency ratio (4) 57.63 % 57.18 %
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 $3,442,796 $3,552,031
Taxable-equivalent adjustment 85,697 75,436
Net interest income - FTE 3,528,493 3,627,467
Noninterest income 3,755,734 2,852,667
Total revenue - FTE 7,284,227 6,480,134
Securities (gains)/losses, net (662,247) (237,423)
Total revenue - FTE excluding
securities (gains)/losses, net (6) $6,621,980 $6,242,711
(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 30.0 million shares of The Coca-Cola
Company as of September 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 after-tax 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
September 30 June 30 (Decrease)(2) (1, 2)
2008 2008 Amount % %
STATEMENTS OF INCOME
NET INTEREST
INCOME $1,146,213 $1,156,716 ($10,503) (0.9)% (3.6)%
Provision for loan
losses 503,672 448,027 55,645 12.4 49.7
NET INTEREST INCOME
AFTER PROVISION
FOR LOAN LOSSES 642,541 708,689 (66,148) (9.3) (37.3)
NONINTEREST INCOME
Service charges on
deposit accounts 240,241 230,296 9,945 4.3 17.3
Trust and investment
management income 147,477 157,319 (9,842) (6.3) (25.0)
Retail investment
services 72,791 73,764 (973) (1.3) (5.3)
Other charges and
fees 128,776 129,581 (805) (0.6) (2.5)
Investment banking
income 62,164 60,987 1,177 1.9 7.7
Trading account
profits/(losses)
and commissions 121,136 (49,306) 170,442 NM NM
Card fees 78,138 78,566 (428) (0.5) (2.2)
Mortgage production
related income 50,028 63,508 (13,480) (21.2) (84.9)
Mortgage servicing
related income 62,654 32,548 30,106 92.5 NM
Gain on sale of
businesses 81,813 29,648 52,165 NM NM
Other noninterest
income 66,958 56,312 10,646 18.9 75.6
Securities gains/
(losses), net 173,046 549,787 (376,741) (68.5) NM
Total noninterest
income 1,285,222 1,413,010 (127,788) (9.0) (36.2)
NONINTEREST EXPENSE
Employee compensation
and benefits 696,210 711,957 (15,747) (2.2) (8.8)
Net occupancy
expense 88,745 85,483 3,262 3.8 15.3
Outside processing
and software 132,361 107,205 25,156 23.5 93.9
Equipment expense 51,931 50,991 940 1.8 7.4
Marketing and customer
development 217,693 47,203 170,490 NM NM
Amortization/impairment
of intangible
assets 18,551 64,735 (46,184) (71.3) NM
Net loss on
extinguishment
of debt - - - - -
Visa litigation 20,000 - 20,000 NM NM
Operating losses 135,183 44,654 90,529 NM NM
Other noninterest
expense 307,412 266,305 41,107 15.4 61.7
Total noninterest
expense 1,668,086 1,378,533 289,553 21.0 84.0
INCOME BEFORE
PROVISION/(BENEFIT)
FOR INCOME TAXES 259,677 743,166 (483,489) (65.1) NM
Provision/(Benefit)
for income taxes (52,767) 202,804 (255,571) NM NM
NET INCOME 312,444 540,362 (227,918) (42.2) NM
Preferred dividends 5,111 5,112 (1) - -
NET INCOME AVAILABLE
TO COMMON
SHAREHOLDERS $307,333 $535,250 ($227,917) (42.6) NM
REVENUE
Net interest
income $1,146,213 $1,156,716 ($10,503) (0.9)% (3.6)%
Taxable-equivalent
adjustment 29,466 28,256 1,210 4.3 17.1
Net interest
income - FTE 1,175,679 1,184,972 (9,293) (0.8) (3.1)
Noninterest
income 1,285,222 1,413,010 (127,788) (9.0) (36.2)
Total revenue
- FTE 2,460,901 2,597,982 (137,081) (5.3) (21.1)
SELECTED AVERAGE
BALANCES (Dollars in millions)
Average loans
Commercial-FTE $38,064 $37,600 $464 1.2% 4.9%
Real estate home
equity lines 15,424 14,980 444 3.0 11.9
Real estate
construction 10,502 11,472 (970) (8.5) (33.8)
Real estate
1-4 family 31,486 32,114 (628) (2.0) (7.8)
Real estate
commercial 14,139 13,877 262 1.9 7.5
Credit card 860 816 44 5.4 21.4
Consumer - direct 4,705 4,382 323 7.4 29.4
Consumer -
indirect 7,152 7,437 (285) (3.8) (15.3)
Nonaccrual and
restructured 3,309 2,514 795 31.6 NM
Total loans $125,641 $125,192 $449 0.4% 1.4%
Average deposits
Noninterest bearing
deposits $20,880 $21,346 ($466) (2.2)% (8.7)%
NOW accounts 20,501 21,762 (1,261) (5.8) (23.2)
Money market
accounts 26,897 26,032 865 3.3 13.3
Savings 3,771 3,939 (168) (4.3) (17.1)
Consumer and
other time 28,150 28,648 (498) (1.7) (7.0)
Total consumer
and commercial
deposits 100,199 101,727 (1,528) (1.5) (6.0)
Brokered and
foreign deposits 15,800 15,068 732 4.9 19.4
Total deposits $115,999 $116,795 ($796) (0.7)% (2.7)%
SELECTED CREDIT DATA
(Dollars in thousands)
Nonaccrual loans $3,289,518 $2,625,328 $664,190 25.3% NM %
Other real estate
owned (OREO) 387,037 334,519 52,518 15.7 62.8
Other repossessed
assets 13,714 13,203 511 3.9 15.5
Total
nonperforming
assets $3,690,269 $2,973,050 $717,219 24.1% 96.5%
Allowance for
loan and lease
losses $1,941,000 $1,829,400 $111,600 6.1% 24.4%
Three Months Ended
September 30 September 30 Increase/(Decrease)(2)
2008 2007 Amount %
STATEMENTS OF INCOME
NET INTEREST INCOME $1,146,213 $1,192,188 ($45,975) (3.9)%
Provision for loan losses 503,672 147,020 356,652 NM
NET INTEREST INCOME AFTER
PROVISION FOR LOAN LOSSES 642,541 1,045,168 (402,627) (38.5)
NONINTEREST INCOME
Service charges on
deposit accounts 240,241 213,939 26,302 12.3
Trust and investment
management income 147,477 175,242 (27,765) (15.8)
Retail investment
services 72,791 71,064 1,727 2.4
Other charges and fees 128,776 120,730 8,046 6.7
Investment banking income 62,164 47,688 14,476 30.4
Trading account
profits/(losses) and
commissions 121,136 (31,187) 152,323 NM
Card fees 78,138 70,450 7,688 10.9
Mortgage production
related income 50,028 12,950 37,078 NM
Mortgage servicing
related income 62,654 57,142 5,512 9.6
Gain on sale of
businesses 81,813 - 81,813 NM
Other noninterest income 66,958 80,130 (13,172) (16.4)
Securities
gains/(losses), net 173,046 991 172,055 NM
Total noninterest
income 1,285,222 819,139 466,083 56.9
NONINTEREST EXPENSE
Employee compensation and
benefits 696,210 677,765 18,445 2.7
Net occupancy expense 88,745 87,626 1,119 1.3
Outside processing and
software 132,361 105,132 27,229 25.9
Equipment expense 51,931 51,532 399 0.8
Marketing and customer
development 217,693 46,897 170,796 NM
Amortization/impairment
of intangible assets 18,551 24,820 (6,269) (25.3)
Net loss on
extinguishment of debt - 9,800 (9,800) (100.0)
Visa litigation 20,000 - 20,000 NM
Operating losses 135,183 52,041 83,142 NM
Other noninterest expense 307,412 235,632 71,780 30.5
Total noninterest
expense 1,668,086 1,291,245 376,841 29.2
INCOME BEFORE
PROVISION/(BENEFIT) FOR
INCOME TAXES 259,677 573,062 (313,385) (54.7)
Provision/(Benefit) for
income taxes (52,767) 152,898 (205,665) NM
NET INCOME 312,444 420,164 (107,720) (25.6)
Preferred dividends 5,111 7,526 (2,415) (32.1)
NET INCOME AVAILABLE TO
COMMON SHAREHOLDERS $307,333 $412,638 ($105,305) (25.5)
REVENUE
Net interest income $1,146,213 $1,192,188 ($45,975) (3.9)%
Taxable-equivalent
adjustment 29,466 27,055 2,411 8.9
Net interest income - FTE 1,175,679 1,219,243 (43,564) (3.6)
Noninterest income 1,285,222 819,139 466,083 56.9
Total revenue - FTE 2,460,901 2,038,382 422,519 20.7
SELECTED AVERAGE BALANCES
(Dollars in millions)
Average loans
Commercial-FTE $38,064 $34,248 $3,816 11.1 %
Real estate home equity
lines 15,424 14,133 1,291 9.1
Real estate construction 10,502 13,687 (3,185) (23.3)
Real estate 1-4 family 31,486 31,004 482 1.6
Real estate commercial 14,139 12,759 1,380 10.8
Credit card 860 516 344 66.7
Consumer - direct 4,705 4,368 337 7.7
Consumer - indirect 7,152 7,966 (814) (10.2)
Nonaccrual and
restructured 3,309 878 2,431 NM
Total loans $125,641 $119,559 $6,082 5.1 %
Average deposits
Noninterest bearing
deposits $20,880 $21,445 ($565) (2.6)%
NOW accounts 20,501 19,544 957 4.9
Money market accounts 26,897 22,560 4,337 19.2
Savings 3,771 4,457 (686) (15.4)
Consumer and other time 28,150 28,702 (552) (1.9)
Total consumer and
commercial deposits 100,199 96,708 3,491 3.6
Brokered and foreign
deposits 15,800 21,140 (5,340) (25.3)
Total deposits $115,999 $117,848 ($1,849) (1.6)%
SELECTED CREDIT DATA
(Dollars in thousands)
Nonaccrual loans $3,289,518 $974,791 $2,314,727 NM %
Other real estate owned
(OREO) 387,037 156,106 230,931 NM
Other repossessed assets 13,714 9,974 3,740 37.5
Total nonperforming
assets $3,690,269 $1,140,871 $2,549,398 NM %
Allowance for loan and
lease losses $1,941,000 $1,093,691 $847,309 77.5 %
(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)
Nine Months Ended
September 30 September 30 Increase/(Decrease)
2008 2007 Amount % (1)
STATEMENTS OF INCOME
NET INTEREST INCOME $3,442,796 $3,552,031 ($109,235) (3.1)%
Provision for loan
losses 1,511,721 308,141 1,203,580 NM
NET INTEREST INCOME
AFTER PROVISION
FOR LOAN LOSSES 1,931,075 3,243,890 (1,312,815) (40.5)
NONINTEREST INCOME
Service charges on
deposit accounts 682,376 599,818 82,558 13.8
Trust and investment
management income 465,898 514,180 (48,282) (9.4)
Retail investment
services 218,855 206,392 12,463 6.0
Other charges and
fees 385,588 357,225 28,363 7.9
Investment banking
income 178,571 159,844 18,727 11.7
Trading account
profits and
commissions 100,048 75,451 24,597 32.6
Card fees 230,465 203,225 27,240 13.4
Mortgage production
related income 199,085 68,617 130,468 NM
Mortgage servicing
related income 124,300 138,072 (13,772) (10.0)
Gain on sale of
businesses 200,851 32,340 168,511 NM
Gain on Visa IPO 86,305 - 86,305 NM
Net gain on
sale/leaseback of
premises 37,039 - 37,039 NM
Other noninterest
income 184,106 260,080 (75,974) (29.2)
Net securities
gains/(losses) 662,247 237,423 424,824 NM
Total
noninterest
income 3,755,734 2,852,667 903,067 31.7
NONINTEREST EXPENSE
Employee compensation
and benefits 2,123,250 2,087,378 35,872 1.7
Net occupancy expense 260,669 258,533 2,136 0.8
Outside processing
and software 348,731 305,538 43,193 14.1
Equipment expense 155,317 154,764 553 0.4
Marketing and
customer development 320,599 135,928 184,671 NM
Amortization/impairment
of intangible
assets 104,001 73,266 30,735 41.9
Loss on
extinguishment of
debt 11,723 9,800 1,923 19.6
Visa litigation (19,124) - (19,124) NM
Operating losses 210,100 91,213 118,887 NM
Other noninterest
expense 786,497 662,016 124,481 18.8
Total
noninterest
expense 4,301,763 3,778,436 523,327 13.9
INCOME BEFORE PROVISION
FOR INCOME TAXES 1,385,046 2,318,121 (933,075) (40.3)
Provision for income
taxes 241,685 695,230 (453,545) (65.2)
NET INCOME 1,143,361 1,622,891 (479,530) (29.5)
Preferred dividends 17,200 22,408 (5,208) (23.2)
NET INCOME AVAILABLE
TO COMMON
SHAREHOLDERS $1,126,161 $1,600,483 ($474,322) (29.6)
REVENUE
Net interest income $3,442,796 $3,552,031 ($109,235) (3.1)%
Taxable-equivalent
adjustment 85,697 75,436 10,261 13.6
Net interest income -
FTE 3,528,493 3,627,467 (98,974) (2.7)
Noninterest income 3,755,734 2,852,667 903,067 31.7
Total revenue - FTE $7,284,227 $6,480,134 $804,093 12.4
SELECTED AVERAGE
BALANCES (Dollars in
millions)
Average loans
Commercial-FTE $37,349 $33,964 $3,385 10.0 %
Real estate home
equity lines 15,004 13,908 1,096 7.9
Real estate
construction 11,471 13,610 (2,139) (15.7)
Real estate 1-4
family 32,011 31,938 73 0.2
Real estate
commercial 13,711 12,774 937 7.3
Credit card 817 430 387 90.0
Consumer - direct 4,385 4,313 72 1.7
Consumer - indirect 7,411 8,064 (653) (8.1)
Nonaccrual and
restructured 2,543 738 1,805 NM
Total loans $124,702 $119,739 $4,963 4.1 %
Average deposits
Noninterest bearing
deposits $20,947 $21,923 ($976) (4.5)%
NOW accounts 21,412 19,809 1,603 8.1
Money market accounts 26,094 22,142 3,952 17.8
Savings 3,875 4,754 (879) (18.5)
Consumer and other
time 28,701 28,843 (142) (0.5)
Total consumer and
commercial
deposits 101,029 97,471 3,558 3.7
Brokered and foreign
deposits 15,446 23,925 (8,479) (35.4)
Total deposits $116,475 $121,396 ($4,921) (4.1)%
(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
September 30 September 30 %
2008 2007 Change(3)
Statements of Income
Net interest income(1) $646,658 $697,341 (7.3)%
FTE adjustment 8,313 9,265 (10.3)
Net interest income - FTE 654,971 706,606 (7.3)
Provision for loan losses(2) 225,614 74,561 NM
Net interest income after provision
for loan losses - FTE 429,357 632,045 (32.1)
Noninterest income before
securities gains/(losses) 352,274 321,904 9.4
Securities gains/(losses), net (220) - NM
Total noninterest income 352,054 321,904 9.4
Noninterest expense before
amortization of intangible assets 669,401 619,693 8.0
Amortization of intangible assets 14,571 17,192 (15.2)
Total noninterest expense 683,972 636,885 7.4
Income before provision for income
taxes 97,439 317,064 (69.3)
Provision for income taxes 24,436 105,044 (76.7)
FTE adjustment 8,313 9,265 (10.3)
Net income $64,690 $202,755 (68.1)
Total revenue - FTE $1,007,025 $1,028,510 (2.1)
Selected Average Balances
Total loans $51,366,891 $51,871,391 (1.0)%
Goodwill 6,272,302 6,139,071 2.2
Other intangible assets excluding
MSRs 166,682 194,011 (14.1)
Total assets 59,143,001 59,248,838 (0.2)
Total deposits 79,947,704 79,076,185 1.1
Performance Ratios
Efficiency ratio 67.92 % 61.92 %
Impact of excluding amortization of
intangible assets (6.09) (5.52)
Tangible efficiency ratio 61.83 % 56.40 %
Nine Months Ended
September 30 September 30 %
2008 2007 Change(3)
Statements of Income
Net interest income(1) $1,916,552 $2,115,454 (9.4)%
FTE adjustment 25,546 28,026 (8.8)
Net interest income - FTE 1,942,098 2,143,480 (9.4)
Provision for loan losses(2) 588,963 179,942 NM
Net interest income after provision
for loan losses - FTE 1,353,135 1,963,538 (31.1)
Noninterest income before
securities gains/(losses) 1,021,261 919,466 11.1
Securities gains/(losses), net (220) 3 NM
Total noninterest income 1,021,041 919,469 11.0
Noninterest expense before
amortization of intangible assets 1,895,536 1,870,156 1.4
Amortization of intangible assets 43,730 53,209 (17.8)
Total noninterest expense 1,939,266 1,923,365 0.8
Income before provision for income
taxes 434,910 959,642 (54.7)
Provision for income taxes 126,337 319,079 (60.4)
FTE adjustment 25,546 28,026 (8.8)
Net income $283,027 $612,537 (53.8)
Total revenue - FTE $2,963,139 $3,062,949 (3.3)
Selected Average Balances
Total loans $51,042,034 $51,442,408 (0.8)%
Goodwill 6,185,900 6,137,393 0.8
Other intangible assets excluding
MSRs 164,621 212,006 (22.4)
Total assets 58,840,745 59,015,000 (0.3)
Total deposits 80,630,196 80,235,275 0.5
Performance Ratios
Efficiency ratio 65.45 % 62.79 %
Impact of excluding amortization of
intangible assets (5.87) (5.61)
Tangible efficiency ratio 59.58 % 57.18 %
(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
September 30 September 30 %
2008 2007 Change(3)
Statements of Income
Net interest income(1) $113,816 $128,336 (11.3)%
FTE adjustment 16,815 13,087 28.5
Net interest income - FTE 130,631 141,423 (7.6)
Provision for loan losses(2) 32,313 15,470 NM
Net interest income after provision
for loan losses - FTE 98,318 125,953 (21.9)
Noninterest income before
securities gains/(losses) 158,237 72,438 NM
Securities gains/(losses), net - - -
Total noninterest income 158,237 72,438 NM
Noninterest expense before
amortization of intangible assets 203,093 178,866 13.5
Amortization of intangible assets 122 122 -
Total noninterest expense 203,215 178,988 13.5
Income before provision/(benefit)
for income taxes 53,340 19,403 NM
Provision/(benefit) for income
taxes (5,536) (26,000) (78.7)
FTE adjustment 16,815 13,087 28.5
Net income $42,061 $32,316 30.2
Total revenue - FTE $288,868 $213,861 35.1
Selected Average Balances
Total loans $34,726,824 $29,492,332 17.7 %
Goodwill 171,967 168,142 2.3
Other intangible assets excluding
MSRs 556 1,047 (46.9)
Total assets 45,825,637 38,610,922 18.7
Total deposits 9,328,409 5,306,665 75.8
Performance Ratios
Efficiency ratio 70.35 % 83.69 %
Impact of excluding amortization of
intangible assets (0.53) (0.78)
Tangible efficiency ratio 69.82 % 82.91 %
Nine Months Ended
September 30 September 30 %
2008 2007 Change(3)
Statements of Income
Net interest income(1) $360,037 $398,243 (9.6)%
FTE adjustment 46,165 34,229 34.9
Net interest income - FTE 406,202 432,472 (6.1)
Provision for loan losses(2) 55,570 33,865 64.1
Net interest income after provision
for loan losses - FTE 350,632 398,607 (12.0)
Noninterest income before
securities gains/(losses) 516,506 466,725 10.7
Securities gains/(losses), net - - -
Total noninterest income 516,506 466,725 10.7
Noninterest expense before
amortization of intangible assets 604,055 565,473 6.8
Amortization of intangible assets 366 366 -
Total noninterest expense 604,421 565,839 6.8
Income before provision/(benefit)
for income taxes 262,717 299,493 (12.3)
Provision/(benefit) for income
taxes 10,070 21,461 (53.1)
FTE adjustment 46,165 34,229 34.9
Net income $206,482 $243,803 (15.3)
Total revenue - FTE $922,708 $899,197 2.6
Selected Average Balances
Total loans $33,727,611 $29,299,307 15.1 %
Goodwill 169,419 168,146 0.8
Other intangible assets excluding
MSRs 679 1,162 (41.6)
Total assets 44,725,704 38,392,096 16.5
Total deposits 8,968,591 4,917,472 82.4
Performance Ratios
Efficiency ratio 65.51 % 62.93 %
Impact of excluding amortization of
intangible assets (0.46) (0.43)
Tangible efficiency ratio 65.05 % 62.50 %
(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
September 30 September 30 %
2008 2007 Change(3)
Statements of Income
Net interest income(1) $107,005 $130,476 (18.0)%
FTE adjustment - - -
Net interest income - FTE 107,005 130,476 (18.0)
Provision for loan losses(2) 124,861 11,733 NM
Net interest income after
provision for loan losses - FTE (17,856) 118,743 NM
Noninterest income before
securities gains/(losses) 133,773 89,948 48.7
Securities gains/(losses), net (5,332) - NM
Total noninterest income 128,441 89,948 42.8
Noninterest expense before
amortization of intangible
assets 365,478 235,134 55.4
Amortization of intangible assets 163 763 (78.6)
Total noninterest expense 365,641 235,897 55.0
Income/(loss) before
provision/(benefit) for income
taxes (255,056) (27,206) NM
Provision/(benefit) for income
taxes (98,911) (14,697) NM
FTE adjustment - - -
Net income/(loss) ($156,145) ($12,509) NM
Total revenue - FTE $235,446 $220,424 6.8
Selected Average Balances
Total loans $31,098,274 $30,084,217 3.4 %
Goodwill 277,189 276,611 0.2
Other intangible assets excluding
MSRs 166 2,810 (94.1)
Total assets 41,147,389 45,260,639 (9.1)
Total deposits 2,307,842 2,322,876 (0.6)
Performance Ratios
Efficiency ratio 155.30 % 107.02 %
Impact of excluding amortization
of intangible assets (2.19) (1.83)
Tangible efficiency ratio 153.11 % 105.19 %
Other Information
Production Data
Channel mix
Retail $3,777,757 $5,565,382 (32.1)%
Wholesale 2,581,750 4,456,315 (42.1)
Correspondent 1,775,523 2,592,592 (31.5)
Total production $8,135,030 $12,614,289 (35.5)
Channel mix - percent
Retail 46 % 44 %
Wholesale 32 35
Correspondent 22 21
Total production 100 % 100 %
Purchase and refinance mix
Refinance $2,514,269 $4,266,890 (41.1)
Purchase 5,620,761 8,347,399 (32.7)
Total production $8,135,030 $12,614,289 (35.5)
Purchase and refinance mix - percent
Refinance 31 % 34 %
Purchase 69 66
Total production 100 % 100 %
Applications $14,429,165 $21,347,294 (32.4)
Mortgage Servicing Data (End of
Period)
Total loans serviced $159,269,209 $149,862,311 6.3 %
Total loans serviced for others 127,027,392 110,457,690 15.0
Net carrying value of MSRs 1,150,013 995,984 15.5
Ratio of net carrying value of
MSRs to total loans serviced
for others 0.905 % 0.902 %
Nine Months Ended
September 30 September 30 %
2008 2007 Change(3)
Statements of Income
Net interest income(1) $361,279 $394,451 (8.4)%
FTE adjustment - - -
Net interest income - FTE 361,279 394,451 (8.4)
Provision for loan losses(2) 351,124 34,993 NM
Net interest income after provision
for loan losses - FTE 10,155 359,458 (97.2)
Noninterest income before
securities gains/(losses) 380,776 265,363 43.5
Securities gains/(losses), net (11,560) - NM
Total noninterest income 369,216 265,363 39.1
Noninterest expense before
amortization of intangible assets 838,412 583,106 43.8
Amortization of intangible assets 1,490 2,290 (34.9)
Total noninterest expense 839,902 585,396 43.5
Income/(loss) before
provision/(benefit) for income
taxes (460,531) 39,425 NM
Provision/(benefit) for income
taxes (183,721) 3,563 NM
FTE adjustment - - -
Net income/(loss) ($276,810) $35,862 NM
Total revenue - FTE $730,495 $659,814 10.7
Selected Average Balances
Total loans $31,598,472 $30,629,171 3.2 %
Goodwill 276,781 276,412 0.1
Other intangible assets excluding
MSRs 668 3,534 (81.1)
Total assets 42,443,317 45,801,700 (7.3)
Total deposits 2,275,990 2,166,451 5.1
Performance Ratios
Efficiency ratio 114.98 % 88.72 %
Impact of excluding amortization of
intangible assets (1.68) (1.55)
Tangible efficiency ratio 113.30 % 87.17 %
Other Information
Production Data
Channel mix
Retail $13,888,030 $18,252,569 (23.9)%
Wholesale 10,013,155 16,475,540 (39.2)
Correspondent 5,302,678 10,672,761 (50.3)
Total production $29,203,863 $45,400,870 (35.7)
Channel mix - percent
Retail 48 % 40 %
Wholesale 34 36
Correspondent 18 24
Total production 100 % 100 %
Purchase and refinance mix
Refinance $13,293,122 $19,554,615 (32.0)
Purchase 15,910,741 25,846,255 (38.4)
Total production $29,203,863 $45,400,870 (35.7)
Purchase and refinance mix - percent
Refinance 46 % 43 %
Purchase 54 57
Total production 100 % 100 %
Applications $51,773,177 $70,216,063 (26.3)
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
September 30 September 30 %
2008 2007 Change(3)
Statements of Income
Net interest income(1) $83,752 $86,870 (3.6)%
FTE adjustment 7 13 (46.2)
Net interest income - FTE 83,759 86,883 (3.6)
Provision for loan losses(2) 9,160 1,914 NM
Net interest income after
provision for loan losses - FTE 74,599 84,969 (12.2)
Noninterest income before
securities gains/(losses) 161,861 258,434 (37.4)
Securities gains/(losses), net (88) (2) NM
Total noninterest income 161,773 258,432 (37.4)
Noninterest expense before
amortization of intangible
assets 225,342 239,919 (6.1)
Amortization of intangible assets 3,592 6,521 (44.9)
Total noninterest expense 228,934 246,440 (7.1)
Income before provision for
income taxes 7,438 96,961 (92.3)
Provision for income taxes 2,997 35,760 (91.6)
FTE adjustment 7 13 (46.2)
Net income $4,434 $61,188 (92.8)
Total revenue - FTE $245,532 $345,315 (28.9)
Selected Average Balances
Total loans $8,217,760 $7,848,930 4.7 %
Goodwill 323,462 314,166 3.0
Other intangible assets excluding
MSRs 68,955 134,068 (48.6)
Total assets 9,015,972 8,771,019 2.8
Total deposits 9,581,356 9,608,257 (0.3)
Performance Ratios
Efficiency ratio 93.24 % 71.37 %
Impact of excluding amortization
of intangible assets (3.15) (2.88)
Tangible efficiency ratio 90.09 % 68.49 %
Other Information (End of Period)
Assets under administration
Managed (discretionary) assets $129,455,527 $142,863,031 (9.4)%
Non-managed assets 51,372,166 59,283,257 (13.3)
Total assets under
administration 180,827,693 202,146,288 (10.5)
Brokerage assets 35,861,251 42,365,873 (15.4)
Corporate trust assets 1,653,688 8,508,088 (80.6)
Total assets under advisement $218,342,632 $253,020,249 (13.7)
Nine Months Ended
September 30 September 30 %
2008 2007 Change(3)
Statements of Income
Net interest income(1) $248,642 $265,723 (6.4)%
FTE adjustment 26 41 (36.6)
Net interest income - FTE 248,668 265,764 (6.4)
Provision for loan losses(2) 16,822 5,925 NM
Net interest income after provision
for loan losses - FTE 231,846 259,839 (10.8)
Noninterest income before securities
gains/(losses) 762,338 794,361 (4.0)
Securities gains/(losses), net (116) 8 NM
Total noninterest income 762,222 794,369 (4.0)
Noninterest expense before
amortization of intangible assets 695,856 746,789 (6.8)
Amortization of intangible assets 58,106 16,737 NM
Total noninterest expense 753,962 763,526 (1.3)
Income before provision for income
taxes 240,106 290,682 (17.4)
Provision for income taxes 86,748 106,830 (18.8)
FTE adjustment 26 41 (36.6)
Net income $153,332 $183,811 (16.6)
Total revenue - FTE $1,010,890 $1,060,133 (4.6)
Selected Average Balances
Total loans $8,102,610 $8,022,472 1.0 %
Goodwill 328,526 314,297 4.5
Other intangible assets excluding
MSRs 105,007 129,395 (18.8)
Total assets 8,956,367 8,923,453 0.4
Total deposits 9,721,176 9,753,449 (0.3)
Performance Ratios
Efficiency ratio 74.58 % 72.02 %
Impact of excluding amortization of
intangible assets (6.74) (2.53)
Tangible efficiency ratio 67.84 % 69.49 %
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
September 30 September 30 %
2008 2007 Change(2)
Statements of Income
Net interest income $194,982 $149,165 30.7 %
FTE adjustment 4,331 4,690 (7.7)
Net interest income - FTE 199,313 153,855 29.5
Provision for loan losses(1) 111,724 43,342 NM
Net interest income after provision
for loan losses - FTE 87,589 110,513 (20.7)
Noninterest income before securities
gains/(losses) 306,031 75,424 NM
Securities gains/(losses), net 178,686 993 NM
Total noninterest income 484,717 76,417 NM
Noninterest expense before
amortization of intangible assets 186,221 (7,187) NM
Amortization of intangible assets 103 222 (53.6)
Total noninterest expense 186,324 (6,965) NM
Income before provision for income
taxes 385,982 193,895 99.1
Provision for income taxes 24,247 52,791 (54.1)
FTE adjustment 4,331 4,690 (7.7)
Net income $357,404 $136,414 NM
Total revenue - FTE $684,030 $230,272 NM
Selected Average Balances
Total loans $232,228 $261,829 (11.3)%
Securities available for sale 13,427,353 14,935,925 (10.1)
Goodwill 4,743 6,372 (25.6)
Other intangible assets excluding
MSRs 4,277 4,756 (10.1)
Total assets 18,756,491 22,761,959 (17.6)
Total deposits (mainly brokered and
foreign) 14,834,316 21,533,440 (31.1)
Nine Months Ended
September 30 September 30 %
2008 2007 Change(2)
Statements of Income
Net interest income $556,286 $378,160 47.1 %
FTE adjustment 13,960 13,140 6.2
Net interest income - FTE 570,246 391,300 45.7
Provision for loan losses(1) 499,242 53,416 NM
Net interest income after provision
for loan losses - FTE 71,004 337,884 (79.0)
Noninterest income before securities
gains/(losses) 412,606 169,329 NM
Securities gains/(losses), net 674,143 237,412 NM
Total noninterest income 1,086,749 406,741 NM
Noninterest expense before
amortization of intangible assets 163,903 (60,354) NM
Amortization of intangible assets 309 664 (53.5)
Total noninterest expense 164,212 (59,690) NM
Income before provision for income
taxes 993,541 804,315 23.5
Provision for income taxes 202,251 244,296 (17.2)
FTE adjustment 13,960 13,140 6.2
Net income $777,330 $546,879 42.1
Total revenue - FTE $1,656,995 $798,041 NM
Selected Average Balances
Total loans $231,670 $345,549 (33.0)%
Securities available for sale 14,207,457 18,370,420 (22.7)
Goodwill 37,304 7,233 NM
Other intangible assets excluding
MSRs 4,381 4,966 (11.8)
Total assets 20,479,550 26,561,381 (22.9)
Total deposits (mainly brokered and
foreign) 14,879,538 24,324,129 (38.8)
September 30 June 30
2008 2008
Other Information
Duration of investment portfolio 4.8 % 5.6 %
Accounting net interest income
interest rate sensitivity(3):
% Change in net interest income
under:
Instantaneous 100 bp increase in
rates over next 12 months 0.8 % 0.1 %
Instantaneous 100 bp decrease in
rates over next 12 months (1.1)% (0.3)%
Economic net interest income interest
rate sensitivity(3):
% Change in net interest income
under:
Instantaneous 100 bp increase in
rates over next 12 months (0.4)% (0.8)%
Instantaneous 100 bp decrease in
rates over next 12 months 0.1 % 0.6 %
(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 fixed rate debt. The net
interest income sensitivity profile from an economic perspective
assumes the net interest payments from the related swaps on the debt
were included in margin.
SunTrust Banks, Inc. and Subsidiaries
CONSOLIDATED - SEGMENT TOTALS
(Dollars in thousands) (Unaudited)
Three Months Ended
September 30 September 30 %
2008 2007 Change(1)
Statements of Income
Net interest income $1,146,213 $1,192,188 (3.9)%
FTE adjustment 29,466 27,055 8.9
Net interest income - FTE 1,175,679 1,219,243 (3.6)
Provision for loan losses 503,672 147,020 NM
Net interest income after
provision for loan losses - FTE 672,007 1,072,223 (37.3)
Noninterest income before
securities gains/(losses) 1,112,176 818,148 35.9
Securities gains/(losses), net 173,046 991 NM
Total noninterest income 1,285,222 819,139 56.9
Noninterest expense before
amortization of intangible
assets 1,649,535 1,266,425 30.3
Amortization of intangible assets 18,551 24,820 (25.3)
Total noninterest expense 1,668,086 1,291,245 29.2
Income before provision/(benefit)
for income taxes 289,143 600,117 (51.8)
Provision/(benefit) for income
taxes (52,767) 152,898 NM
FTE adjustment 29,466 27,055 8.9
Net income $312,444 $420,164 (25.6)
Total revenue - FTE $2,460,901 $2,038,382 20.7
Selected Average Balances
Total loans $125,641,977 $119,558,699 5.1 %
Goodwill 7,049,663 6,904,362 2.1
Other intangible assets excluding
MSRs 240,636 336,692 (28.5)
Total assets 173,888,490 174,653,377 (0.4)
Total deposits 115,999,627 117,847,423 (1.6)
Performance Ratios
Efficiency ratio 67.78 % 63.35 %
Impact of excluding amortization
of intangible assets (0.75) (1.22)
Tangible efficiency ratio 67.03 % 62.13 %
(1) "NM" - Not meaningful. Those changes over 100 percent were not
considered to be meaningful.
Nine Months Ended
September 30 September 30 %
2008 2007 Change(1)
Statements of Income
Net interest income $3,442,796 $3,552,031 (3.1)%
FTE adjustment 85,697 75,436 13.6
Net interest income - FTE 3,528,493 3,627,467 (2.7)
Provision for loan losses 1,511,721 308,141 NM
Net interest income after
provision for loan losses - FTE 2,016,772 3,319,326 (39.2)
Noninterest income before
securities gains/(losses) 3,093,487 2,615,244 18.3
Securities gains/(losses), net 662,247 237,423 NM
Total noninterest income 3,755,734 2,852,667 31.7
Noninterest expense before
amortization of intangible
assets 4,197,762 3,705,170 13.3
Amortization of intangible assets 104,001 73,266 41.9
Total noninterest expense 4,301,763 3,778,436 13.9
Income before provision/(benefit)
for income taxes 1,470,743 2,393,557 (38.6)
Provision/(benefit) for income
taxes 241,685 695,230 (65.2)
FTE adjustment 85,697 75,436 13.6
Net income $1,143,361 $1,622,891 (29.5)
Total revenue - FTE $7,284,227 $6,480,134 12.4
Selected Average Balances
Total loans $124,702,397 $119,738,907 4.1 %
Goodwill 6,997,930 6,903,481 1.4
Other intangible assets excluding
MSRs 275,356 351,063 (21.6)
Total assets 175,445,683 178,693,630 (1.8)
Total deposits 116,475,491 121,396,776 (4.1)
Performance Ratios
Efficiency ratio 59.06 % 58.31 %
Impact of excluding amortization
of intangible assets (1.43) (1.13)
Tangible efficiency ratio 57.63 % 57.18 %
(1) "NM" - Not meaningful. Those changes over 100 percent were not
considered to be meaningful.
SOURCE SunTrust Banks, Inc.
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Related links:
http://www.suntrust.com
CONTACT:
Investors, Steve Shriner, +1-404-827-6714, or
Media, Barry Koling, +1-404-230-5268, both for SunTrust Banks,
Inc./ /FIRST ADD -- TABULAR MATERIAL -- TO FOLLOW
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