<PAGE>

 ----------------------------------------------------------------------------
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                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM 10-Q

            Quarterly Report Pursuant to Section 13 or 15(d) of the
                        Securities Exchange Act of 1934


   For the Quarterly Period Ended September 30, 1999
                                                   Commission file number 1-7476

                             AmSouth Bancorporation
             (Exact Name of registrant as specified in its charter)

<TABLE>
<S>                                           <C>
                   Delaware                                         63-0591257
        (State or other jurisdiction of
         Incorporation or Organization)                 (I.R.S. Employer Identification No.)

             AmSouth--Sonat Tower
            1900 Fifth Avenue North
              Birmingham, Alabama                                      35203
   (Address of principal executive offices)                          (Zip Code)
</TABLE>

                                 (205) 320-7151
               (Registrant's telephone number, including area code)

  Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
Yes   X    No

As of November 10, 1999, AmSouth Bancorporation had 391,088,837 shares of
common stock outstanding.

 ----------------------------------------------------------------------------
 ----------------------------------------------------------------------------

<PAGE>

                            AMSOUTH BANCORPORATION
                                   FORM 10-Q
                                     INDEX

<TABLE>
<CAPTION>
                                                                           Page
                                                                           ----
<S>                                                                        <C>
Part I.Financial Information
     Item 1.a Historical Financial Statements (Unaudited).................   3
        Consolidated Statement of Condition--September 30, 1999, December
             31, 1998, and September 30, 1998.............................   3
        Consolidated Statement of Earnings--Nine months ended September
             30, 1999 and 1998............................................   4
        Consolidated Statement of Shareholders' Equity--Nine months ended
             September 30, 1999...........................................   5
        Consolidated Statement of Cash Flows--Nine months ended September
             30, 1999 and 1998 ...........................................   6
        Notes to Consolidated Financial Statements........................   7
        Independent Accountants' Review Report............................  10
     Item 1.b  Supplemental Combined Financial Information (Unaudited)....  11
     Item 2.   Management's Discussion and Analysis of Financial Condition
            and Results of   Operations...................................  14
Part II. Other Information
     Item 1. Legal Proceedings............................................  26
     Item 4. Submission of Matters to a Vote of Security Holders..........  26
     Item 5. Other Information............................................  26
     Item 6. Exhibits and Reports on Form 8-K.............................  27
Signatures................................................................  28
Exhibit Index.............................................................  29
</TABLE>

   Forward-Looking Information. This Quarterly Report on Form 10-Q contains
certain forward-looking statements with respect to the adequacy of the
allowance for loan losses, the effect of legal proceedings on AmSouth's
financial condition and results of operations, the Year 2000 issue, and with
respect to certain other issues. These forward-looking statements involve
certain risks, uncertainties, estimates, and assumptions by management.

   Various factors could cause actual results to differ materially from those
contemplated by such forward-looking statements. With respect to the adequacy
of the allowance for loan losses, these factors include the rate of growth in
the economy, especially in the Southeast, the relative strength and weakness
in the consumer and commercial credit sectors of the economy and in the real
estate markets, the performance of the stock and bond markets, and the
potential effects of the Year 2000 issue. With regard to the effect of legal
proceedings, various uncertainties are discussed in "Part II, Item 1. Legal
Proceedings." Moreover, the outcome of litigation is inherently uncertain and
depends on judicial interpretations of law and the findings of judges and
juries. The information regarding Year 2000 compliance is based on
management's current assessment. However, this is an ongoing process involving
continual evaluation, and unanticipated problems could develop that could
cause compliance to be more difficult or costly than currently anticipated.

                                       2

<PAGE>

                                     PART I
                             FINANCIAL INFORMATION
              Item 1.a Historical Financial Statements (Unaudited)

                    AMSOUTH BANCORPORATION AND SUBSIDIARIES
                      CONSOLIDATED STATEMENT OF CONDITION
                                  (Unaudited)

<TABLE>
<CAPTION>
                                          September 30  December 31  September 30
                                              1999         1998          1998
                                          ------------  -----------  ------------
                                                     (In thousands)
<S>                                       <C>           <C>          <C>
ASSETS
Cash and due from banks.................  $   584,176   $   619,599  $   532,758
Federal funds sold and securities
 purchased under agreements to resell...       22,625         5,609          500
Trading securities......................        8,783         4,144        2,689
Available-for-sale securities...........    3,581,168     3,029,372    3,281,129
Held-to-maturity securities (market
 value of $2,126,990, $2,162,102 and
 $2,328,440, respectively)..............    2,170,022     2,147,044    2,297,091
Mortgage loans held for sale............       41,050       148,461       81,483
Other interest-earning assets...........        7,392        29,276       21,988
Loans...................................   13,851,474    12,977,467   12,622,913
Less: Allowance for loan losses.........      177,556       176,075      175,046
Unearned income.........................      143,858       107,604       95,745
                                          -----------   -----------  -----------
   Net loans............................   13,530,060    12,693,788   12,352,122
Premises and equipment, net.............      331,645       336,772      324,903
Customers' acceptance liability.........        1,552         3,947        1,047
Accrued interest receivable and other
 assets.................................      999,322       883,667      797,633
                                          -----------   -----------  -----------
                                          $21,277,795   $19,901,679  $19,693,343
                                          ===========   ===========  ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
Deposits and interest-bearing
 liabilities:
 Deposits:
  Noninterest-bearing demand............  $ 2,191,574   $ 2,215,887  $ 2,040,880
  Interest-bearing demand...............    4,546,668     4,559,470    4,185,796
  Savings...............................      884,315       980,829      990,272
  Time..................................    4,332,450     4,553,666    4,700,940
  Certificates of deposit of $100,000
   or more..............................      992,283       973,952    1,099,279
                                          -----------   -----------  -----------
   Total deposits.......................   12,947,290    13,283,804   13,017,167
 Federal funds purchased and securities
  sold under agreements to repurchase...    1,855,606     1,482,100    1,283,025
 Other borrowed funds...................      404,577        88,873      312,156
 Long-term Federal Home Loan Bank
  advances..............................    3,450,082     2,500,117    2,515,118
 Other long-term debt...................      788,805       739,642      739,803
                                          -----------   -----------  -----------
   Total deposits and interest-bearing
    liabilities.........................   19,446,360    18,094,536   17,867,269
Acceptances outstanding.................        1,552         3,947        1,047
Accrued expenses and other liabilities..      357,425       375,567      387,070
                                          -----------   -----------  -----------
   Total liabilities....................   19,805,337    18,474,050   18,255,386
                                          -----------   -----------  -----------
Shareholders' equity:
 Preferred stock--no par value:
  Authorized--2,000,000 shares; Issued
   and outstanding--none................          -0-           -0-          -0-
 Common stock--par value $1 a share:
  Authorized--750,000,000 shares;
   Issued--202,413,293, 202,425,450 and
   202,635,075 shares, respectively.....      202,413       202,425      202,635
 Capital surplus........................      455,817       448,620      448,424
 Retained earnings......................    1,257,862     1,133,046    1,096,249
 Cost of common stock in treasury--
  25,854,655, 25,048,731 and 23,774,241
  shares, respectively..................     (392,744)     (367,286)    (333,797)
 Deferred compensation on restricted
  stock.................................      (10,607)       (8,272)      (9,054)
 Accumulated other comprehensive (loss)
  income................................      (40,283)       19,096       33,500
                                          -----------   -----------  -----------
   Total shareholders' equity...........    1,472,458     1,427,629    1,437,957
                                          -----------   -----------  -----------
                                          $21,277,795   $19,901,679  $19,693,343
                                          ===========   ===========  ===========
</TABLE>

                See notes to consolidated financial statements.

                                       3

<PAGE>

                    AMSOUTH BANCORPORATION AND SUBSIDIARIES
                       CONSOLIDATED STATEMENT OF EARNINGS
                                  (Unaudited)

<TABLE>
<CAPTION>
                                           Nine Months         Three Months
                                       Ended September 30   Ended September 30
                                      --------------------- -------------------
                                         1999       1998      1999      1998
                                      ---------- ---------- --------- ---------
                                        (In thousands except per share data)
<S>                                   <C>        <C>        <C>       <C>
INTEREST INCOME
Loans...............................  $  837,013 $  810,060  $286,216  $275,383
Available-for-sale securities.......     161,683    160,265    59,751    56,958
Held-to-maturity securities.........     102,548    121,763    36,100    39,058
Trading securities..................         120         85        35        37
Mortgage loans held for sale........       3,559      3,435     1,063       932
Federal funds sold and securities
 purchased under agreements to re-
 sell...............................         406        690       125       286
Other interest-earning assets.......         706        336       169       215
                                      ---------- ---------- --------- ---------
 Total interest income..............   1,106,035  1,096,634   383,459   372,869
                                      ---------- ---------- --------- ---------
INTEREST EXPENSE
Interest-bearing demand deposits....     102,597    106,562    35,389    37,924
Savings deposits....................      13,871     22,288     4,337     7,343
Time deposits.......................     178,661    204,286    59,055    67,869
Certificates of deposit of $100,000
 or more............................      36,162     44,263    12,140    15,969
Federal funds purchased and securi-
 ties sold under agreements to re-
 purchase...........................      58,869     54,128    21,849    20,048
Other borrowed funds................       7,171     23,468     3,127     5,109
Long-term Federal Home Loan Bank ad-
 vances.............................     106,179     85,842    40,032    32,450
Other long-term debt................      36,710     35,994    11,790    12,643
                                      ---------- ---------- --------- ---------
 Total interest expense.............     540,220    576,831   187,719   199,355
                                      ---------- ---------- --------- ---------
NET INTEREST INCOME                      565,815    519,803   195,740   173,514
Provision for loan losses...........      29,400     45,834    12,400     8,000
                                      ---------- ---------- --------- ---------
NET INTEREST INCOME AFTER PROVISION
 FOR LOAN LOSSES                         536,415    473,969   183,340   165,514
                                      ---------- ---------- --------- ---------
NONINTEREST REVENUES
Service charges on deposit ac-
 counts.............................      79,595     78,236    26,782    26,289
Trust income........................      51,688     50,846    17,184    15,714
Consumer investment services in-
 come...............................      33,349     23,148    11,452     7,862
Mortgage income.....................      18,096     12,809     5,400     4,219
Portfolio income....................      11,162      6,923     3,401     3,092
Bank owned life insurance policies
 (BOLI).............................      14,567     13,874     5,236     3,952
Net gain on sale of businesses......           0     27,974         0         0
Other noninterest revenues..........      57,717     47,564    19,525    16,069
                                      ---------- ---------- --------- ---------
 Total noninterest revenues.........     266,174    261,374    88,980    77,197
                                      ---------- ---------- --------- ---------
NONINTEREST EXPENSES
Salaries and employee benefits......     237,891    215,441    79,502    70,810
Net occupancy expense...............      43,696     42,524    14,929    14,438
Equipment expense...................      48,327     46,958    16,530    14,892
Marketing expense...................      15,997     15,306     5,233     5,270
Postage and office supplies.........      18,213     18,017     5,968     6,056
Communications expense..............      16,946     17,250     5,219     5,771
Amortization expense................      12,555     12,888     4,190     4,166
Other noninterest expenses..........      66,164     66,060    21,475    17,913
                                      ---------- ---------- --------- ---------
 Total noninterest expenses.........     459,789    434,444   153,046   139,316
                                      ---------- ---------- --------- ---------
INCOME BEFORE INCOME TAXES               342,800    300,899   119,274   103,395
Income taxes........................     120,796    106,562    41,849    36,551
                                      ---------- ---------- --------- ---------
<CAPTION>
 NET INCOME.........................  $  222,004 $  194,337 $  77,425 $  66,844
<S>                                   <C>        <C>        <C>       <C>
                                      ========== ========== ========= =========
Average common shares outstanding...     175,544    179,731   175,411   178,704
Earnings per common share...........  $     1.26 $     1.08 $    0.44 $    0.37
Diluted average common shares out-
 standing...........................     178,158    182,647   177,758   181,432
Diluted earnings per common share...  $     1.25 $     1.06 $    0.44 $    0.37
Cash dividends declared.............  $     0.51 $     0.40 $    0.17 $    0.13
</TABLE>

                See notes to consolidated financial statements.

                                       4
<PAGE>

                    AMSOUTH BANCORPORATION AND SUBSIDIARIES
                 CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY
                                  (Unaudited)
<TABLE>
<CAPTION>
                                                                       Deferred
                                                                     Compensation  Accumulated
                                                                          on          Other
                           Common   Capital    Retained   Treasury    Restricted  Comprehensive
                           Stock    Surplus    Earnings     Stock       Stock     Income (Loss)   Total
                          --------  --------  ----------  ---------  ------------ ------------- ----------
                                                         (In thousands)
<S>                       <C>       <C>       <C>         <C>        <C>          <C>           <C>
BALANCE AT JANUARY 1,
 1999...................  $134,950  $516,095  $1,133,046  $(367,286)   $ (8,272)    $ 19,096    $1,427,629
Adjustment for the
 effect of 3-for-2
 common stock split.....    67,475   (67,475)        -0-        -0-         -0-          -0-           -0-
                          --------  --------  ----------  ---------    --------     --------    ----------
BALANCE AT JANUARY 1,
 1999, RESTATED.........   202,425   448,620   1,133,046   (367,286)     (8,272)      19,096     1,427,629
Comprehensive income:
 Net income.............       -0-       -0-     222,004        -0-         -0-          -0-       222,004
 Other comprehensive
  income, net of tax:
 Unrealized losses on
  available-for-sale
  securities, net of
  reclassification
  adjustment............       -0-       -0-         -0-        -0-         -0-      (59,379)      (59,379)
                                                                                                ----------
Comprehensive income....                                                                           162,625
Cash dividends declared
 ($0.51 per common
 share*)................       -0-       -0-     (89,266)       -0-         -0-          -0-       (89,266)
Common stock
 transactions:
 Purchase of common
  stock.................       -0-       -0-         -0-    (62,008)        -0-          -0-       (62,008)
 Benefit stock plans....       (12)    7,090      (7,348)    31,616      (2,335)         -0-        29,011
 Dividend reinvestment
  plan..................       -0-       107        (574)     4,934         -0-          -0-         4,467
                          --------  --------  ----------  ---------    --------     --------    ----------
BALANCE AT SEPTEMBER 30,
 1999...................  $202,413  $455,817  $1,257,862  $(392,744)   $(10,607)    $(40,283)   $1,472,458
                          ========  ========  ==========  =========    ========     ========    ==========
Disclosure of
 reclassification
 amount:
Unrealized holding
 losses on available-
 for-sale securities
 arising during the
 period.................                                                            $(53,688)
Less: Reclassification
 adjustment for gains
 realized in net
 income.................                                                               5,691
                                                                                    --------
Net unrealized losses on
 available-for-sale
 securities, net of
 tax....................                                                            $(59,379)
                                                                                    ========
</TABLE>
--------
* Restated for three-for-two common stock split in May 1999


                See notes to consolidated financial statements.

                                       5
<PAGE>

                    AMSOUTH BANCORPORATION AND SUBSIDIARIES
                      CONSOLIDATED STATEMENT OF CASH FLOWS
                                  (Unaudited)
<TABLE>
<CAPTION>
                                                             Nine Months
                                                         Ended September 30
                                                        ----------------------
                                                           1999        1998
                                                        ----------  ----------
                                                           (In thousands)
<S>                                                     <C>         <C>
OPERATING ACTIVITIES
Net income............................................  $  222,004  $  194,337
Adjustments to reconcile net income to net cash
 provided by operating activities:
  Provision for loan losses...........................      29,400      45,834
  Depreciation and amortization of premises and
   equipment..........................................      34,368      28,639
  Amortization of premiums and discounts on held-to-
   maturity securities and available-for-sale
   securities.........................................       3,189      (2,113)
  Net decrease (increase) in mortgage loans held for
   sale...............................................     107,411        (663)
  Net increase in trading securities..................      (4,639)     (1,283)
  Net gains on sales of available-for-sale
   securities.........................................      (8,860)     (5,218)
  Net increase in accrued interest receivable and
   other assets.......................................    (108,636)   (106,172)
  Net increase in accrued expenses and other
   liabilities........................................      13,301      69,600
  Provision for deferred income taxes.................      41,298      27,683
  Amortization of intangible assets...................      12,265      12,342
  Other operating activities, net.....................       9,843       6,780
                                                        ----------  ----------
    Net cash provided by operating activities.........     350,944     269,766
                                                        ----------  ----------
INVESTING ACTIVITIES
Proceeds from maturities and prepayments of available-
 for-sale securities..................................     643,825     535,321
Proceeds from sales of available-for-sale securities..     460,836     630,135
Purchases of available-for-sale securities............  (1,783,789) (1,838,659)
Proceeds from maturities, prepayments and calls of
 held-to-maturity securities..........................     584,619     885,245
Purchases of held-to-maturity securities..............    (632,422)   (880,140)
Net (increase) decrease in federal funds sold and
 securities purchased under agreements to resell......     (17,016)     18,500
Net decrease (increase) in other interest-earning
 assets...............................................      21,884     (21,988)
Net increase in loans.................................    (888,012)   (401,353)
Net purchases of premises and equipment...............     (29,241)    (39,342)
                                                        ----------  ----------
    Net cash used by investing activities.............  (1,639,316) (1,112,281)
                                                        ----------  ----------
FINANCING ACTIVITIES
Net (decrease) increase in demand deposits and savings
 accounts.............................................    (133,629)    165,517
Net decrease in time deposits.........................    (202,761)    (93,346)
Net increase (decrease) in federal funds purchased and
 securities sold under agreements to repurchase.......     373,506    (152,900)
Net increase (decrease) in other borrowed funds.......     315,704    (673,762)
Issuance of long-term Federal Home Loan Bank advances
 and other long-term debt.............................   1,399,231   1,878,973
Payments for maturing long-term debt..................    (399,938)   (256,942)
Cash dividends paid...................................     (59,527)    (72,061)
Cash payment for special rights and warrants on common
 stock................................................         -0-        (355)
Proceeds from benefit and dividend reinvestment
 plans................................................      22,371      19,788
Purchase of common stock..............................     (62,008)    (98,139)
                                                        ----------  ----------
    Net cash provided by financing activities.........   1,252,949     716,773
                                                        ----------  ----------
Decrease in cash and cash equivalents.................     (35,423)   (125,742)
Cash and cash equivalents at beginning of period......     619,599     658,500
                                                        ----------  ----------
Cash and cash equivalents at end of period............  $  584,176  $  532,758
                                                        ==========  ==========
</TABLE>

                See notes to consolidated financial statements.

                                       6
<PAGE>

                    AMSOUTH BANCORPORATION AND SUBSIDIARIES
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                  (Unaudited)

                 Nine Months Ended September 30, 1999 and 1998

   General--The consolidated financial statements conform to generally
accepted accounting principles and to general industry practices. The
accompanying interim financial statements are unaudited; however, in the
opinion of management, all adjustments necessary for the fair presentation of
the consolidated financial statements have been included. All such adjustments
are of a normal recurring nature. Certain amounts in the prior year's
financial statements have been reclassified to conform with the 1999
presentation. These reclassifications had no effect on net income. All common
share data presented in the consolidated financial statements reflect a three-
for-two stock split completed on May 24, 1999. The notes included herein
should be read in conjunction with the notes to consolidated financial
statements included in AmSouth Bancorporation's (AmSouth) 1998 annual report
on Form 10-K.

   In June 1998, Statement of Financial Accounting Standards No. 133,
"Accounting for Derivative Instruments and for Hedging Activities" (Statement
133), was issued by the Financial Accounting Standards Board (FASB). Statement
133 provides a comprehensive and consistent standard for the recognition and
measurement of derivatives and hedging activities. It requires all derivatives
to be recorded on the balance sheet at fair value and establishes unique
accounting treatment for the following three different types of hedges: hedges
of changes in the fair value of assets, liabilities or firm commitments,
referred to as fair value hedges; hedges of the variable cash flows of
forecasted transactions, referred to as cash flow hedges; and hedges of
foreign currency exposures of net investments in foreign operations. The
accounting for each of the three types of hedges results in recognizing
offsetting changes in value or cash flows of both the hedge and the hedged
item in earnings in the same period. Changes in the fair value of derivatives
that do not meet the criteria of one of these three types of hedges are
included in earnings in the period of change. Statement 133 was originally
effective for fiscal years beginning after June 15, 1999. In June 1999, FASB
issued Statement of Financial Accounting Standard No. 137, "Accounting for
Derivative Instruments and Hedging Activities--Deferral of the Effective Date
of FASB Statement No. 133" (Statement 137), which defers the effective date of
Statement 133 to fiscal years beginning after June 15, 2000. The impact of
adopting Statement 133 on AmSouth's financial condition or results of
operations has not been determined at this time.

   Cash Flows--For the nine months ended September 30, 1999 and 1998, AmSouth
paid interest of $534,641,000 and $557,583,000, respectively, and income taxes
of $78,806,000 and $58,408,000, respectively. Noncash transfers from loans to
foreclosed properties for the nine months ended September 30, 1999 and 1998,
were $16,796,000 and $8,523,000, respectively, and noncash transfers from
foreclosed properties to loans were $413,000 and $364,000, respectively. For
the nine months ended September 30, 1999, noncash transfers from loans to
available-for-sale securities and to other assets of approximately $6,860,000
and $10,425,000, respectively, were made in connection with the participation
of mortgages to third-party conduits. For the nine months ended September 30,
1998, noncash transfers from loans to available-for-sale securities of
approximately $49,183,000 were made in connection with mortgage loan
securitizations.

   Comprehensive Income--Total comprehensive income was $67,976,000 and
$162,625,000 for the three and nine months ended September 30, 1999 and
$74,811,000 and $201,244,000 for the three and nine months ended September 30,
1998. Total comprehensive income consists of net income and the change in the
unrealized gain or loss on the Corporation's available-for-sale security
portfolio arising during the period.


                                       7
<PAGE>

   Earnings Per Common Share--The following table sets forth the computation
of earnings per common share and diluted earnings per common share:

<TABLE>
<CAPTION>
                                        Three Months Ended   Nine Months Ended
                                           September 30        September 30
                                        ------------------- -------------------
                                          1999      1998      1999      1998
                                        --------- --------- --------- ---------
                                         (In thousands except per share data)
<S>                                     <C>       <C>       <C>       <C>
Earnings per common share computation:
  Numerator:
   Net income.......................... $  77,425 $  66,844 $ 222,004 $ 194,337
  Denominator:
   Average common shares outstanding...   175,411   178,704   175,544   179,731
Earnings per common share.............. $     .44 $     .37 $    1.26 $    1.08
Diluted earnings per common share
 computation:
  Numerator:
   Net income.......................... $  77,425 $  66,844 $ 222,004 $ 194,337
  Denominator:
   Average common shares outstanding...   175,411   178,704   175,544   179,731
   Dilutive shares contingently
    issuable...........................     2,347     2,728     2,614     2,916
                                        --------- --------- --------- ---------
    Average diluted common shares
     outstanding.......................   177,758   181,432   178,158   182,647
Diluted earnings per common share...... $     .44 $     .37 $    1.25 $    1.06
</TABLE>

   Acquisition--On October 1, 1999, the Corporation completed the acquisition
of First American Corporation ("First American"). Including the acquisition of
First American, AmSouth today has $43.4 billion in assets and approximately
660 branch banking offices and 1,365 ATMs in nine southeastern states. AmSouth
and its subsidiaries provide a full line of traditional and nontraditional
financial services including consumer and commercial banking, small business
banking, mortgage loans, trust services and investment management. See Item
1.b, Supplemental Combined Financial Information.

   Shareholders' Equity--On March 20, 1997, AmSouth's Board of Directors
approved the repurchase by AmSouth of up to 13,500,000 shares of its common
stock for the purpose of funding employee benefit and dividend reinvestment
plans and for general corporate purposes. AmSouth purchased 5,859,000 shares
at a cost of $110,267,000 during 1997, 5,297,000 shares at a cost of
$136,514,000 during 1998 and 1,352,000 shares at a cost of $41,247,000 during
the first three months of 1999 under this authorization. The authorization for
the remaining 992,000 shares expired in March 1999.

   On April 15, 1999, AmSouth's shareholders approved an increase in the
common stock authorized to be issued by AmSouth to 350,000,000 shares.

   On April 15, 1999, a three-for-two common stock split in the form of a 50
percent common stock dividend was announced. The stock dividend was paid May
24 to shareholders of record as of April 30.

   On April 15, 1999, AmSouth's Board of Directors approved the repurchase of
approximately 13,100,000 shares of the Company's outstanding common stock for
the purpose of funding employee benefit and dividend reinvestment plans and
for general corporate purposes. From April 15, 1999 to May 30, 1999, AmSouth
purchased 655,200 shares at a cost of $20,398,000. The authorization was
rescinded by the Board of Directors on May 31, 1999.

   On September 16, 1999, in an action related to the merger with First
American, AmSouth's shareholders approved an increase in the common stock
authorized to be issued by AmSouth from 350,000,000 to 750,000,000 shares.


                                       8

<PAGE>

   Business Segment Information--AmSouth has three reportable segments:
Consumer Banking, Commercial Banking, and Capital Management. Treasury & Other
is comprised of balance sheet management activities that include the
investment portfolio, nondeposit funding and off-balance sheet financial
instruments. Treasury & Other also includes BOLI income and corporate expenses
such as corporate overhead and goodwill amortization. All revenues and
expenses related to the bond administration and stock transfer businesses,
sold in 1998, are included in Treasury & Other for 1998. The following is a
summary of the segment performance for the three months and nine months ended
September 30, 1999 and 1998:

<TABLE>
<CAPTION>
                             Consumer Commercial  Capital   Treasury &
                             Banking   Banking   Management   Other     Total
                             -------- ---------- ---------- ---------- --------
                                               (In thousands)
<S>                          <C>      <C>        <C>        <C>        <C>
Three Months Ended
 September 30, 1999
Net interest income from
 external customers........  $ 76,454  $ 89,702   $  (158)   $ 29,742  $195,740
Internal funding...........    51,154   (32,012)      250     (19,392)      -0-
                             --------  --------   -------    --------  --------
Net interest income........   127,608    57,690        92      10,350   195,740
Noninterest revenues.......    39,317    11,291    28,638       9,734    88,980
                             --------  --------   -------    --------  --------
Total revenues.............   166,925    68,981    28,730      20,084   284,720
Provision for loan losses..    11,203       723       -0-         474    12,400
Noninterest expenses.......    89,938    24,854    19,190      19,064   153,046
                             --------  --------   -------    --------  --------
Income before income
 taxes.....................    65,784    43,404     9,540         546   119,274
Income taxes...............    24,771    16,298     3,577      (2,797)   41,849
                             --------  --------   -------    --------  --------
Segment net income.........  $ 41,013  $ 27,106   $ 5,963    $  3,343  $ 77,425
                             ========  ========   =======    ========  ========
Three Months Ended
 September 30, 1998
Net interest income from
 external customers........  $ 43,430  $ 95,852   $  (556)   $ 34,788  $173,514
Internal funding...........    62,970   (40,217)    1,240     (23,993)      -0-
                             --------  --------   -------    --------  --------
Net interest income........   106,400    55,635       684      10,795   173,514
Noninterest revenues.......    36,600     9,076    23,421       8,100    77,197
                             --------  --------   -------    --------  --------
Total revenues.............   143,000    64,711    24,105      18,895   250,711
Provision for loan losses..     6,953        80       -0-         967     8,000
Noninterest expenses.......    84,317    23,422    16,026      15,551   139,316
                             --------  --------   -------    --------  --------
Income before income
 taxes.....................    51,730    41,209     8,079       2,377   103,395
Income taxes...............    20,196    15,482     2,651      (1,778)   36,551
                             --------  --------   -------    --------  --------
Segment net income.........  $ 31,534  $ 25,727   $ 5,428    $  4,155  $ 66,844
                             ========  ========   =======    ========  ========
Nine Months Ended September
 30, 1999
Net interest income from
 external customers........  $205,010  $277,950   $  (597)   $ 83,452  $565,815
Internal funding...........   165,862  (105,678)    1,260     (61,444)      -0-
                             --------  --------   -------    --------  --------
Net interest income........   370,872   172,272       663      22,008   565,815
Noninterest revenues.......   117,426    35,140    85,047      28,561   266,174
                             --------  --------   -------    --------  --------
Total revenues.............   488,298   207,412    85,710      50,569   831,989
Provision for loan losses..    26,004     1,915       -0-       1,481    29,400
Noninterest expenses.......   268,133    75,418    58,174      58,064   459,789
                             --------  --------   -------    --------  --------
Income before income
 taxes.....................   194,161   130,079    27,536      (8,976)  342,800
Income taxes...............    73,071    48,712    10,316     (11,303)  120,796
                             --------  --------   -------    --------  --------
Segment net income.........  $121,090  $ 81,367   $17,220    $  2,327  $222,004
                             ========  ========   =======    ========  ========
Nine Months Ended September
 30, 1998
Net interest income from
 external customers........  $141,857  $281,806   $(2,176)   $ 98,316  $519,803
Internal funding...........   180,864  (121,430)    4,255     (63,689)      -0-
                             --------  --------   -------    --------  --------
Net interest income........   322,721   160,376     2,079      34,627   519,803
Noninterest revenues.......   110,739    25,148    71,053      54,434   261,374
                             --------  --------   -------    --------  --------
Total revenues.............   433,460   185,524    73,132      89,061   781,177
Provision for loan losses..    31,054     4,031       -0-      10,749    45,834
Noninterest expenses.......   251,346    71,276    49,551      62,271   434,444
                             --------  --------   -------    --------  --------
Income before income
 taxes.....................   151,060   110,217    23,581      16,041   300,899
Income taxes...............    57,508    41,405     8,073        (424)  106,562
                             --------  --------   -------    --------  --------
Segment net income.........  $ 93,552  $ 68,812   $15,508    $ 16,465  $194,337
                             ========  ========   =======    ========  ========
</TABLE>


                                       9

<PAGE>

Item 1.b SUPPLEMENTAL COMBINED FINANCIAL INFORMATION

  The following unaudited supplemental combined financial information gives
retroactive effect to the merger of AmSouth and First American consummated on
October 1, 1999 (the "Merger") on a pooling of interests accounting basis.
Accordingly, the unaudited supplemental combined financial information
combines the historical financial information of AmSouth and First American
for all periods presented herein. Certain insignificant reclassifications have
been included to ensure consistent presentation.

  The combined financial information includes merger related costs of $19.7
million and $47.7 million for the three and nine month periods ended September
30, 1999 and $37.1 million and $109.2 million for the same periods of 1998.
These amounts were primarily related to the acquisition of companies by First
American prior to the Merger. Merger related costs associated with the Merger
are expected to primarily be incurred over the next three quarters. The third
quarter of 1999 also included $15.6 million of special charges. These special
charges included an $8.0 million impairment loss on a portfolio investment,
and approximately $7.6 million of other charges conforming First American to
AmSouth's accounting policies and practices. These special charges are
included in the provision for loan losses, noninterest revenue and noninterest
expense. Excluding the merger related costs and these other special charges,
AmSouth would have recorded net income of $156.6 million and $443.6 million
for the three months and nine months ended September 30, 1999, respectively,
or $0.40 and $1.12 per diluted share, respectively.

  The supplemental data are presented for comparative purposes only and are
not necessarily indicative of the future financial position or results of
operations of the combined company.

                                      11
<PAGE>

                    AMSOUTH BANCORPORATION AND SUBSIDIARIES
                  SUPPLEMENTAL COMBINED FINANCIAL INFORMATION
                 (Dollars in thousands, except per share data)
                                  (Unaudited)

<TABLE>
<CAPTION>
                                           Third Quarter          Third Quarter
                                               1999      % Change     1998
-------------------------------------------------------------------------------
<S>                                        <C>           <C>      <C>
Excluding merger related costs and other
 special charges:
 Earnings:
  Net income..............................  $   156,554     6.4%   $   147,130
  Provision for loan losses...............       27,604    66.2         16,604
  Noninterest revenue.....................      225,218    12.9        199,545
  Noninterest expense.....................      336,879     8.3        310,971
 Per Share:
  Diluted earnings per common share.......  $      0.40     8.1    $      0.37
  Earnings per common share...............         0.40     5.3           0.38
 Ratios:
  Return on average assets................         1.46%                  1.49%
  Return on average common equity.........        19.03                  18.87
  Efficiency ratio........................        55.09                  55.13

-------------------------------------------------------------------------------
Including merger related costs and other
 special charges:
 Earnings:
  Net interest income.....................  $   380,347     6.3%   $   357,761
  Provision for loan losses...............       30,604    84.3         16,604
  Noninterest revenue excluding gain on
   sale of businesses.....................      207,753     4.1        199,545
  Net gain on sale of businesses..........        8,624      --             --
  Noninterest expense excluding merger
   related costs..........................      340,680     9.6        310,971
  Merger related costs....................       19,672   (47.0)        37,139
  Income taxes............................       71,122     4.2         68,250
                                            -----------            -----------
  Net income..............................  $   134,646     8.3    $   124,342
                                            ===========            ===========

-------------------------------------------------------------------------------
 Per share:
  Diluted earnings per common share.......  $      0.34     6.3%   $      0.32
  Earnings per common share...............         0.35     9.4           0.32

-------------------------------------------------------------------------------
 Average Balances:
  Total assets............................  $42,619,886     8.6%   $39,246,344
  Interest-earning assets.................   38,833,086     8.0     35,972,211
  Loans net of unearned income............   25,715,288     7.8     23,857,684
  Deposits................................   27,539,662     1.9     27,029,115
  Total shareholders' equity..............    3,264,009     5.5      3,093,142

-------------------------------------------------------------------------------
 At quarter end:
  Common shares issued and outstanding....      391,949     0.4%       390,475
  Book value per common share.............  $      8.10     0.7    $      8.04
  Tangible book value per common share....  $      6.99     2.0    $      6.85

-------------------------------------------------------------------------------
 Ratios:
  Return on average assets................         1.25%                  1.26%
  Return on average common equity.........        16.37                  15.95
  Average shareholders' equity to average
   total assets...........................         7.66                   7.88
  Efficiency ratio........................        59.79                  61.72

-------------------------------------------------------------------------------
 Credit quality information:
  Nonaccrual loans........................  $   161,842    46.6%   $   110,362
  Nonperforming assets....................  $   186,329    46.9    $   126,854
  Nonperforming assets to loans net of
   unearned income, foreclosed properties
   and repossessions......................         0.71%                  0.54%
  Net charge-offs.........................  $    31,046   116.1%   $    14,368
  Allowance for loan losses to loans net
   of unearned income.....................         1.39%                  1.55%
  Net charge-offs to average loans net of
   unearned income........................         0.48                   0.24
  Allowance for loan losses to
   nonperforming loans....................       225.79                 331.27
  Allowance for loan losses to
   nonperforming assets...................       196.12                 288.20
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
</TABLE>

                                       12
<PAGE>

                    AMSOUTH BANCORPORATION AND SUBSIDIARIES
                  SUPPLEMENTAL COMBINED FINANCIAL INFORMATION
                 (Dollars in thousands, except per share data)
                                  (Unaudited)

<TABLE>
<CAPTION>
                                                Year through September 30,
                                             ----------------------------------
                                                1999      % Change     1998

--------------------------------------------------------------------------------
<S>                                          <C>          <C>       <C>
Excluding merger related costs and other
 special charges:
 Earnings:
  Net income................................ $   443,619     8.1 %  $   410,430
  Provision for loan losses.................      64,926    (4.1)        67,713
  Noninterest revenue.......................     640,586     6.0        604,265
  Noninterest expense ......................   1,016,578     4.6        971,593
 Per Share:
  Diluted earnings per common share......... $      1.12     7.7    $      1.04
  Earnings per common share.................        1.13     6.6           1.06
 Ratios:
  Return on average assets..................        1.44%                  1.43%
  Return on average common equity...........       18.28                  17.89
  Efficiency ratio..........................       56.90                  57.25

--------------------------------------------------------------------------------
Including merger related costs and other
 special charges:
 Earnings:
  Net interest income....................... $ 1,126,684     4.9 %  $ 1,074,221
  Provision for loan losses.................      67,926     0.3         67,713
  Noninterest revenue excluding gain on sale
   of businesses ...........................     623,121     8.1        576,291
  Net gain on sale of businesses............       8,624   (69.2)        27,974
  Noninterest expense excluding merger
   related costs ...........................   1,020,380     5.0        971,593
  Merger related costs......................      47,710   (56.3)       109,202
  Income taxes..............................     219,391    14.2        192,110
                                             -----------            -----------
  Net income................................ $   403,022    19.3    $   337,868
                                             ===========            ===========

--------------------------------------------------------------------------------
 Per share:
  Diluted earning per common share.......... $      1.02    20.0 %  $      0.85
  Earning per common share..................        1.03    18.4           0.87
--------------------------------------------------------------------------------
 Average Balances:

  Total assets.............................. $41,263,284     7.5 %  $38,399,780
  Interest-earning assets...................  37,594,118     7.0     35,123,035
  Loans net of unearned income..............  25,115,170     4.1     24,115,351
  Deposits..................................  27,569,991     2.4     26,923,051
  Total shareholders' equity................   3,244,820     5.8      3,066,939

--------------------------------------------------------------------------------
 At quarter end:
  Common shares issued and outstanding......     391,949     0.4 %      390,475
  Book value per common share............... $      8.10     0.7    $      8.04
  Tangible book value per common share...... $      6.99     2.0    $      6.85

--------------------------------------------------------------------------------
 Ratios:
  Return on average assets..................        1.31%                  1.18%
  Return on average common equity...........       16.61                  14.73
  Average shareholders' equity to average
   total assets.............................        7.86                   7.99
  Efficiency ratio..........................       60.08                  63.69

--------------------------------------------------------------------------------
 Credit quality information:
  Nonaccrual loans.......................... $   161,842    46.6 %  $   110,362
  Nonperforming assets...................... $   186,329    46.9    $   126,854
  Nonperforming assets to loans net of
   unearned income, foreclosed properties
   and repossessions........................        0.71%                  0.54%
  Net charge-offs........................... $    76,255    37.1 %  $    55,613
  Allowance for loan losses to loans net of
   unearned income..........................        1.39%                  1.55%
  Net charge-offs to average loans net of
   unearned income..........................        0.41                   0.31
  Allowance for loan losses to nonperforming
   loans....................................      225.79                 331.27
  Allowance for loan losses to nonperforming
   assets...................................      196.12                 288.20

</TABLE>

--------------------------------------------------------------------------------
--------------------------------------------------------------------------------

                                       13
<PAGE>

                    Independent Accountants' Review Report

The Board of Directors
AmSouth Bancorporation

We have reviewed the accompanying consolidated statements of condition of
AmSouth Bancorporation and subsidiaries as of September 30, 1999 and 1998, and
the related consolidated statements of earnings for the three-month and nine-
month periods ended September 30, 1999 and 1998, and consolidated statements
of cash flows for the nine-month periods ended September 30, 1999 and 1998,
and the consolidated statement of shareholders' equity for the nine-month
period ended September 30, 1999. These financial statements are the
responsibility of the Company's management.

We conducted our reviews in accordance with standards established by the
American Institute of Certified Public Accountants. A review of interim
financial information consists principally of applying analytical procedures
to financial data, and making inquiries of persons responsible for financial
and accounting matters. It is substantially less in scope than an audit
conducted in accordance with generally accepted auditing standards, which will
be performed for the full year with the objective of expressing an opinion
regarding the financial statements taken as a whole. Accordingly, we do not
express such an opinion.

Based on our reviews, we are not aware of any material modifications that
should be made to the accompanying consolidated financial statements referred
to above for them to be in conformity with generally accepted accounting
principles.

We have previously audited, in accordance with generally accepted auditing
standards, the consolidated statement of condition of AmSouth Bancorporation
and subsidiaries as of December 31, 1998, and the related consolidated
statements of earnings, shareholders' equity, and cash flows for the year then
ended (not presented herein) and in our report dated January 29, 1999, except
for Note 22 as to which the date is March 1, 1999, we expressed an unqualified
opinion on those consolidated financial statements. In our opinion, the
information set forth in the accompanying consolidated statement of condition
as of December 31, 1998 is fairly stated, in all material respects, in
relation to the consolidated statement of condition from which it has been
derived.

                                          /s/ ERNST & YOUNG LLP

November 10, 1999

                                      10
<PAGE>

Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations

   In October 1999, AmSouth acquired First American Corporation and First
American Corporation merged into AmSouth (the "Merger"), with AmSouth the
surviving entity. AmSouth is a bank holding company whose principal subsidiary
as of September 30, 1999 was AmSouth Bank. Because the merger occurred after
September 30, 1999, the historical financial statements in this report do not
give effect to the Merger. The results presented in the historical financial
statements and, except where noted, in this discussion represent the results
of AmSouth and do not include the results of First American Corporation for
any of the periods presented. See the Supplemental Combined Financial
Information included in Item 1.b for combined financial information giving
retroactive effect to the Merger on a pooling of interests accounting basis.

   AmSouth reported net income of $222.0 million for the nine months ended
September 30, 1999, a 14.2% increase over net income of $194.3 million for the
same period of 1998. Diluted earnings per common share were $1.25 and $1.06
for the nine month periods ended September 30, 1999 and 1998, respectively.
AmSouth's year-to-date earnings resulted in an annualized return on average
assets (ROA) of 1.46% and an annualized return on average equity (ROE) of
20.77% for 1999 compared to 1.34% and 18.37%, respectively, for the first nine
months of 1998.

   Net income for the third quarter of 1999 was $77.4 million compared to
$66.8 million for the same period of 1998. Diluted earnings per common share
for these periods were $.44 and $.37, respectively. ROA and ROE for the third
quarter of 1999 were 1.47% and 21.35%, respectively, compared to 1.34% and
18.65%, respectively, for the third quarter of 1998.

   Total assets were $21.3 billion at quarter end, compared to 1998's quarter-
end assets of $19.7 billion. The increase was primarily the result of
continued loan growth over the past year. Loans net of unearned income at
September 30, 1999, increased $1.2 billion from September 30, 1998, to $13.7
billion. On a managed basis, which includes commercial and residential loans
participated to third-party conduits, loans increased $2.5 billion to $16.3
billion at quarter end. The increases in the managed loan portfolio occurred
primarily in commercial and industrial, commercial real estate, home equity,
and indirect lending.

   On the funding side of the balance sheet, total deposits at September 30,
1999 decreased slightly, with increases in interest-bearing and noninterest-
bearing demand deposits offsetting a 7.8% and 9.7% decrease in time deposits
and certificates of deposit of $100,000 or more, respectively. AmSouth
increased its use of federal funds purchased and securities sold under
agreements to repurchase as a funding source. Federal funds purchased and
securities sold under agreements to repurchase increased to $1.9 billion at
September 30, 1999, a 44.6% increase over 1998 third-quarter end. AmSouth
continued to increase its use of Federal Home Loan Bank (FHLB) advances as a
funding source. FHLB advances increased to $3.5 billion at September 30, 1999,
a 37.2% increase over 1998 third-quarter end.

Net Interest Income

   Net interest income on a fully taxable equivalent basis for the nine months
ended September 30, 1999, was $570.2 million, an 8.8% increase over the same
period of 1998. The increase can be attributed to lower funding costs and a
shift in the mix of AmSouth's earning assets from investment securities to
higher yielding loans. This resulted in a widening of the net interest margin
to 4.08% from 3.91% for the nine months ended September 30, 1998. Lower
borrowing and deposit rates across all categories of deposits contributed to
the lower funding costs. The improvement was further enhanced by a shift in
the deposit mix from higher cost consumer CDs to noninterest-bearing demand
and lower cost interest checking and money market deposit accounts.

   Net interest income on a fully taxable equivalent basis for the three
months ended September 30, 1999 was $197.3 million, a 12.7% increase over the
same period of 1998. The net interest margin and the net interest spread
increased 29 and 33 basis points, respectively, from the prior year. The
reasons for the increases were primarily the same as those discussed in the
year-to-date analysis.

Asset/Liability Management

   AmSouth maintains a formal asset and liability management process to
quantify, monitor and control interest rate risk and to assist management in
maintaining stability in the net interest margin under varying

                                      14
<PAGE>

interest rate environments. AmSouth accomplishes this process through the
development and implementation of lending, funding and pricing strategies
designed to maximize net interest income performance under varying interest
rate environments and in compliance with specific liquidity and interest rate
risk guidelines.

   An earnings simulation model is the primary tool used to assess the
direction and magnitude of changes in net interest income (NII) resulting from
changes in interest rates. Key assumptions in the model include prepayment
speeds on mortgage-related assets; cash flows and maturities of derivatives
and other financial instruments held for purposes other than trading; changes
in market conditions, loan volumes and pricing; deposit sensitivity; customer
preferences and management's financial and capital plans. These assumptions
are inherently uncertain, and, as a result, the model cannot precisely
estimate NII or precisely predict the impact of higher or lower interest rates
on NII. Actual results will differ from simulated results due to timing,
magnitude and frequency of interest rate changes and changes in market
conditions and management strategies, among other factors.

   Based on the results of the simulation model as of September 30, 1999,
AmSouth would expect NII to decrease $15.7 million and increase $5.6 million
if interest rates gradually increase or decrease, respectively, from current
rates by 100 basis points over a 12-month period. This level of interest rate
risk is well within the Company's policy guidelines. Based on September 30,
1998 simulation model results, AmSouth would have expected decreases of $0.2
million and $4.2 million if interest rates had gradually increased or
decreased from the rates in effect at the time by 100 basis points over a 12-
month period.

   AmSouth, from time to time, utilizes various off-balance sheet instruments
such as interest rate swaps, caps and floors to assist in managing interest
rate risk. During 1999, AmSouth entered into additional interest rate swaps in
the notional amount of $1.5 billion. There have been $15.0 million in
maturities or terminations of interest rate swaps in 1999. Interest rate swaps
in the notional amount of $450.0 million were called during the first nine
months of 1999. At September 30, 1999, AmSouth had interest rate swaps, all of
which receive fixed rates, totaling a notional amount of $1.9 billion. The
swaps added in 1999 as hedges were designated to certain deposits, commercial
loans and indebtedness of AmSouth Bank. At September 30, 1999, AmSouth also
held other off-balance sheet instruments to provide customers and AmSouth a
means of managing the risks of changing interest and foreign exchange rates.
These other off-balance sheet instruments were immaterial.

Credit Quality

   AmSouth maintains an allowance for loan losses which management believes is
adequate to absorb losses inherent in the loan portfolio. A formal review is
prepared quarterly to assess the risk in the portfolio and to determine the
adequacy of the allowance for loan losses. The review includes analyses of
historical performance, the level of nonperforming and adversely rated loans,
specific analyses of certain problem loans, loan activity since the previous
quarter, reports prepared by the Credit Review Department, consideration of
current economic conditions, and other pertinent information. The level of
allowance to net loans outstanding will vary depending on the overall results
of this quarterly review. The review is presented to and subsequently approved
by senior management and reviewed by the Audit and Community Responsibility
Committee of the Board of Directors.

   Table 6 presents a five-quarter analysis of the allowance for loan losses.
At September 30, 1999, the allowance for loan losses was $177.6 million, or
1.30% of loans net of unearned income, compared to $175.0 million, or 1.40%,
for the prior year. The coverage ratio of the allowance for loan losses to
nonperforming loans decreased from 236.10% at September 30, 1998, to 167.39%
at September 30, 1999. Over the same period, the level of nonperforming loans
increased $31.9 million. The increase was primarily the result of three
commercial credits placed on non-accrual during the quarter. Two of the
credits were to borrowers in the health care services sector for whom a
material portion of their services are long-term, acute care services and
whose revenues are substantially dependent upon reimbursements from
government-sponsored programs such as Medicare and Medicaid. Reimbursement
rates from such programs are strictly regulated and subject to funding
appropriations from federal and state governments. Implementation by the
United States government of the Prospective Payment System for the Medicare
system and other changes in the Medicare program have, in recent quarters,
resulted in significantly lower Medicare revenues for health care service
providers like the aforesaid borrowers than would have been received under the
old Medicare payment methodology. AmSouth cannot

                                      15
<PAGE>

predict exactly what will be the future effect of such changes on this portion
of its health care-related lending portfolio. However, this portion of the
portfolio, together with the rest of the health care-related portfolio, will
continue to be closely monitored. At September 30, 1999, AmSouth had
approximately $120.0 million of loans in this portion of its health care
lending portfolio, $32.4 million of which were considered nonperforming at
quarter-end. On a combined basis, AmSouth and First American had approximately
$146.6 million of loans outstanding to this segment of the health care
industry at September 30, 1999, $36.9 million of which were considered
nonperforming at quarter-end.

   Net charge-offs for the quarter ended September 30, 1999, were $11.9
million, an increase of $4.9 million or 69.6% from $7.0 million a year
earlier. The increase was the result of higher charge-offs in the commercial,
dealer, indirect and other residential mortgage portfolios. For the nine
months ended September 30, 1999, net charge-offs were $27.9 million, a
decrease of $7.2 million, or 20.4 %, from $35.1 million for the same period of
1998. Annualized net charge-offs to average loans net of unearned income were
0.35% and 0.28%, respectively, for the three months and nine months ended
September 30, 1999, compared to 0.22% and 0.38% for the same periods of the
prior year. The decrease in net charge-offs occurred primarily in AmSouth's
revolving credit portfolio, which decreased $635.0 thousand and $11.4 million
for the three months and nine months versus the same periods of 1998. The
decline in revolving credit net charge-offs reflects the sale of approximately
$169.5 million of underperforming credit card loans in the second quarter of
1998. In addition, net charge-offs for the direct consumer lending portfolio
decreased $510.0 thousand and $2.2 million for the three months and nine
months versus the same periods of the prior year. This decrease was offset by
a $2.3 million and $4.7 million increase in net charge-offs in AmSouth's
indirect lending portfolio for the three and nine month periods ended
September 30, 1999 versus the same periods of 1998. Annualized net charge-offs
for the consumer loan portfolio were 0.50% of average consumer loans for the
three months ended September 30, 1999 compared to 0.43% for the same period of
1998. Annualized net charge-offs for the consumer loan portfolio fell to 0.45%
of average consumer loans for the nine months ended September 30, 1999
compared to 0.67% for the prior year. The provision for loan losses for the
third quarter was $12.4 million and $29.4 million for the first nine months of
1999 compared to $8.0 million and $45.8 million for the year-earlier periods.
The 1999 provision reflects loan loss exposure related to the overall growth
in the loan portfolio and the change in the mix of the loan portfolio.

   Table 7 presents a five-quarter comparison of the components of
nonperforming assets. At September 30, 1999, nonperforming assets as a
percentage of loans net of unearned income, foreclosed properties and
repossessions, increased 23 basis points to 0.90% compared to September 30,
1998. The level of nonperforming assets increased $39.2 million during the
same period.

   Included in nonperforming assets at September 30, 1999 and 1998, was $56.7
million and $42.2 million, respectively, in loans that were considered to be
impaired, substantially all of which were on a nonaccrual basis. Collateral-
dependent loans, which were measured at the fair value of the collateral,
constituted almost all of these impaired loans. At September 30, 1999 and
1998, there was $20.6 million and $4.8 million, respectively, in the allowance
for loan losses specifically allocated to these impaired loans. The average
balance of impaired loans for the three months ended September 30, 1999 and
1998, was $39.1 million and $44.4 million, respectively, and $32.6 million and
$48.1 million, respectively, for the nine months ended September 30, 1999 and
1998. AmSouth recorded no material interest income on its impaired loans
during the three months and nine months ended September 30, 1999.

Noninterest Revenues and Noninterest Expenses

   Year-to-date noninterest revenues totaled $266.2 million at September 30,
1999, compared to $261.4 million for the prior-year period. Included in
noninterest revenues for 1998 was a $28.0 million gain from the sale of
AmSouth's bond administration and stock transfer businesses and the sale of
certain credit card assets during the second quarter of 1998. Excluding the
effects of this one-time gain, noninterest revenues rose $32.8 million or
14.0% compared to the same period a year earlier. Growth occurred in most
major categories, including consumer investment services income, mortgage
income and portfolio income. Consumer investment services income increased
$10.2 million primarily as a result of a higher sales volume of annuity
products. Mortgage income increased $5.3 million primarily as a result of
gains on the sales of residential mortgage loans to third-

                                      16
<PAGE>

party conduits partially offset by a decrease in gains on sale of servicing.
Other noninterest revenues increased $10.2 million primarily due to an
increase in income from commercial loan conduit activity. Noninterest revenues
for the third quarter of 1999 were $89.0 million. Noninterest revenues for the
quarter increased 15.3% compared to the same period last year. Changes for the
quarter were primarily for the same reasons discussed in the year-to-date
analysis.

   Year-to-date noninterest expenses increased 5.8% to $459.8 million at
September 30, 1999, compared to $434.4 million for the prior year. Salaries
and employee benefits increased $22.5 million when compared to the same period
a year ago. The increase is primarily due to an increased number of employees
associated with new revenue initiatives, annual merit increases and incentives
associated with AmSouth's stronger financial performance. Equipment expense
increased $1.4 million when compared to the same period a year ago. The
increase is due to the implementation of consumer and commercial automation
projects and additional expenses associated with the addition of Florida
branches purchased from another bank. Noninterest expenses for the third
quarter of 1999 were $153.0 million, an increase of 9.9% over the same period
of 1998. Changes for the quarter were primarily for the same reasons discussed
in the year-to-date analysis.

Capital Adequacy

   At September 30, 1999, shareholders' equity totaled $1.5 billion or 6.92%
of total assets. Since December 31, 1998, shareholders' equity increased $44.8
million as dividends of $89.3 million and the purchase of 2,024,000 shares of
AmSouth common stock for $62.0 million offset the increase from net income of
$222.0 million.

   Table 10 presents the capital amounts and risk-adjusted capital ratios for
AmSouth and AmSouth Bank at September 30, 1999 and 1998. At September 30,
1999, AmSouth exceeded the regulatory minimum required risk-adjusted Tier 1
Capital Ratio of 4.00% and risk-adjusted Total Capital Ratio of 8.00%. In
addition, the risk-adjusted capital ratios for AmSouth Bank were above the
regulatory minimums, and the bank was well capitalized at September 30, 1999.

Year 2000 Project

   The following information that appears in this section constitutes Year
2000 Readiness Disclosure, pursuant to the Year 2000 Information and Readiness
Disclosure Act.

   The Year 2000 issue is the result of computer systems using a two-digit
format, as opposed to four digits, to indicate the year. Any of AmSouth's
computer programs or hardware that have date-sensitive software or embedded
chips may not appropriately interpret dates beyond the year 1999. This could
result in a system failure, miscalculation or other computer errors causing
disruptions of operations. AmSouth believes that it has an effective program
in place to resolve the Year 2000 issue in a timely manner and that it is
unlikely that the Year 2000 issue will cause any significant problems with
customer service or otherwise have a material adverse impact on AmSouth's
operations or financial performance.

   A Year 2000 project team, consisting of professionals from all areas of
AmSouth, was created in 1997 to plan and oversee AmSouth's Year 2000 efforts.
A plan was developed which involves the following five phases: awareness,
assessment, remediation, testing, and implementation. The plan also included
communicating with external service providers to ensure that they are taking
appropriate action to remedy any Year 2000 issues. To date, AmSouth has fully
completed its assessment phase of all systems that could be affected by the
Year 2000. As part of the assessment phase, systems that have the greatest
impact on the operations of AmSouth were designated as mission critical
systems. The remediation, testing and implementation phases for all internal
mission critical systems are 100% complete, with all phases meeting relevant
regulatory guidelines. Even after testing and implementation, AmSouth has
continued and will continue testing throughout 1999 to reaffirm the Year 2000
compliance of mission critical systems.

   A small number of mission critical systems are provided by third parties on
a service bureau basis, such as credit card processing and services supporting
securities brokerage businesses. All such third-party providers of

                                      17
<PAGE>

mission critical services have certified their Year 2000 readiness and all
completed their testing by March 31, 1999, as required by federal banking
regulations. Further, AmSouth is now utilizing the Year 2000 compliant
versions of all third-party mission critical systems, as was required by June
30, 1999, according to federal banking regulations.

   While AmSouth's greatest focus and efforts to date have been on preparing
mission critical systems for the Year 2000, substantially all noncritical
systems have been remediated, tested and implemented.

   In addition, AmSouth is continuing the process of assessing the Year 2000
readiness of its significant customers, suppliers and counterparties. In the
fourth quarter of 1997, AmSouth began researching the issue of Year 2000 and
the possible impact of Year 2000 on its loan customers' liquidity and their
ability to repay their loans. Early last year, AmSouth established an
education and assessment program for all of its commercial loan customers with
credit exposure of $100,000 or more. Meetings were held with these customers
to assess their risk of Year 2000 problems as well as their understanding and
progress toward preparing their systems to operate in the Year 2000. AmSouth
has continued throughout 1999 to assess and evaluate the impact of Year 2000
in its credit analysis of current and future loan customers and plans to
continue throughout 1999 and 2000.

   AmSouth has also used a survey process to review its exposure with respect
to counterparties to various transactions. In domestic securities
transactions, AmSouth only enters into transactions with recognized dealers
that are monitored by U.S. regulators. AmSouth plans to suspend trading with
any domestic dealers who cannot demonstrate their Year 2000 compliance by the
fourth quarter of 1999. Annual lines with international securities dealers
were reviewed before the end of 1998, all with satisfactory results.

   AmSouth has contacted all of its essential suppliers regarding their Year
2000 compliance and has completed an analysis of the possible impact of
noncompliance on their ability to fulfill their commitments to AmSouth. To
date, AmSouth is not aware of any external supplier with a Year 2000 issue
that would materially impact AmSouth's results of operations, liquidity or
capital resources.

   The potential impact of the Year 2000 issue on AmSouth's responsibilities
when it acts in a fiduciary capacity is also being considered. Assets under
fiduciary management are being reviewed to assess the possible impact of the
Year 2000 issue on their value. The extent of analysis of particular assets is
based on an assessment of their risk characteristics. This will be combined
with a review of accounts above a predetermined dollar amount. Consideration
of Year 2000 issues will be a part of ongoing activities, including investment
selection and acceptance of new accounts.

   In recent years, AmSouth has invested heavily in new technology to improve
service and competitiveness. In addition, AmSouth utilizes common operating
systems company-wide. As a result, AmSouth estimates that the total
incremental cost of Year 2000 compliance, which excludes the cost to upgrade
and replace systems in the ordinary course of business, will not exceed $10.0
million, the majority of which has already been expensed.

   As noted above, AmSouth believes that it has an effective program in place
to resolve the Year 2000 issue. However, for unexpected reasons, the Year 2000
issue could impact AmSouth's operations. In addition, disruptions in the
economy generally resulting from Year 2000 issues could also materially impact
AmSouth. There can also be no guarantee that the systems of other companies on
which AmSouth's systems rely will not have any adverse impact on AmSouth's
systems.

   While AmSouth has no reason to conclude that a failure will occur, the most
likely worst-case Year 2000 scenarios entail those items over which AmSouth
has no control, including (1) unpredictable actions resulting from irrational
public demand even if the Year 2000 issue actually presents no problems and
(2) a scenario where a disruption or failure of AmSouth's power suppliers or
voice and data transmission suppliers impacts AmSouth, its customers, vendors,
and the public infrastructure. If such public reaction or a failure were to
occur, AmSouth would implement a contingency plan. While it is impossible to
quantify the impact of such scenarios, the most reasonably likely worst-case
scenario would entail liquidity issues related to increased customer
withdrawals or the diminishment of service levels, resulting in customer
inconvenience, and additional costs associated with the implementation of
contingency plans.

                                      18
<PAGE>

   AmSouth has comprehensive contingency plans in place to address these
scenarios and other possible system and service failures that could occur
outside of AmSouth's control in an effort to minimize the impact on AmSouth of
other organizations' failures to properly remediate their systems. These plans
include having back-up power and telecommunication sources and sufficient
resources to deal with possible increased liquidity demands. Additionally,
AmSouth has formulated event plans and outlined responsibilities for the days
immediately preceding and including the date change.

                          Table 1--Financial Summary

<TABLE>
<CAPTION>
                              September 30
                         ------------------------    %
                            1999         1998      Change
                         -----------  -----------  ------
                                 (In thousands)
<S>                      <C>          <C>          <C>    <C>        <C>        <C>
Balance sheet summary
End-of-period balances:
 Loans net of unearned
  income................ $13,707,616  $12,527,168    9.4%
 Total assets...........  21,277,795   19,693,343    8.0
 Total deposits.........  12,947,290   13,017,167   (0.5)
 Shareholders' equity...   1,472,458    1,437,957    2.4
Year-to-date average
 balances:
 Loans net of unearned
  income................ $13,282,285  $12,370,269    7.4%
 Total assets...........  20,341,018   19,432,513    4.7
 Total deposits.........  13,068,839   12,890,941    1.4
 Shareholders' equity...   1,429,064    1,414,533    1.0
<CAPTION>
                               Nine Months                   Three Months
                           Ended September 30             Ended September 30
                         ------------------------    %    --------------------    %
                            1999         1998      Change   1999       1998     Change
                         -----------  -----------  ------ ---------  ---------  ------
                                   (In thousands except per share data)
<S>                      <C>          <C>          <C>    <C>        <C>        <C>
Earnings summary
 Net income............. $   222,004  $   194,337   14.2% $  77,425  $  66,844   15.8%
 Per common share*......        1.26         1.08   16.7       0.44       0.37   18.9
 Per common share--
  diluted*..............        1.25         1.06   17.9       0.44       0.37   18.9
Selected ratios
 Return on average as-
  sets (annualized).....        1.46%        1.34%             1.47%      1.34%
 Return on average eq-
  uity (annualized).....       20.77        18.37             21.35      18.65
 Average equity to
  assets................        7.03         7.28              6.91       7.16
 End-of-period equity to
  assets................        6.92         7.30              6.92       7.30
 End-of-period tangible
  equity to assets......        5.93         6.16              5.93       6.16
 Allowance for loan
  losses to loans net of
  unearned income.......        1.30         1.40              1.30       1.40
 Efficiency ratio.......       54.97        55.31             53.47      55.25
Common stock data*
 Cash dividends
  declared.............. $      0.51  $      0.40         $    0.17  $    0.13
 Book value at end of
  period................        8.34         8.04              8.34       8.04
 Market value at end of
  period................       23.44        22.75             23.44      22.75
 Average common shares
  outstanding...........     175,544      179,731           175,411    178,704
 Average common shares
  outstanding--diluted..     178,158      182,647           177,758    181,432
</TABLE>
--------
* Restated for three-for-two common stock split in May 1999

                                      19
<PAGE>

     Table 2--Year-to-Date Yields Earned on Average Interest-Earning Assets
             and Rates Paid on Average Interest-Bearing Liabilities

<TABLE>
<CAPTION>
                                                                1999                           1998
                                                    ------------------------------ -----------------------------
                                                             Nine Months                   Nine Months
                                                         Ended September 30             Ended September 30
                                                    ------------------------------ -----------------------------
                                                      Average     Revenue/  Yield/   Average    Revenue/  Yield/
                                                      Balance      Expense   Rate    Balance     Expense   Rate
                                                    ------------  --------- ------ -----------  --------- ------
                                                         (Taxable equivalent basis-dollars in thousands)
<S>                                                 <C>           <C>       <C>    <C>          <C>       <C>
Assets
Interest-earning assets:
 Loans net of unearned income.....................  $ 13,282,285  $ 838,245  8.44% $12,370,269  $ 811,406  8.77%
 Available-for-sale securities....................     3,180,651    161,683  6.80    3,024,666    160,265  7.08
 Held-to-maturity securities:
 Taxable..........................................     1,929,938     96,266  6.67    2,298,117    115,642  6.73
 Tax-free.........................................       147,685      9,472  8.58      110,267      9,118 11.06
                                                    ------------  ---------        -----------  ---------
 Total held-to-maturity securities................     2,077,623    105,738  6.80    2,408,384    124,760  6.93
                                                    ------------  ---------        -----------  ---------
  Total investment securities.....................     5,258,274    267,421  6.80    5,433,050    285,025  7.01
 Other interest-earning assets....................       128,213      4,791  5.00      113,045      4,546  5.38
                                                    ------------  ---------        -----------  ---------
 Total interest-earning assets....................    18,668,772  1,110,457  7.95   17,916,364  1,100,977  8.22
Cash and other assets.............................     1,859,909                     1,651,194
Allowance for loan losses.........................      (177,752)                     (175,764)
Market valuation on available-for-sale
 securities.......................................        (9,911)                       40,719
                                                    ------------                   -----------
                                                    $ 20,341,018                   $19,432,513
                                                    ============                   ===========
Liabilities and Shareholders' Equity
Interest-bearing liabilities:
 Interest-bearing demand deposits.................  $  4,460,672    102,597  3.08  $ 3,998,916    106,562  3.56
 Savings deposits.................................       946,387     13,871  1.96    1,023,954     22,288  2.91
 Time deposits....................................     4,533,585    178,661  5.27    4,860,101    204,286  5.62
 Certificates of deposit of $100,000 or more......       938,547     36,162  5.15    1,039,599     44,263  5.69
 Federal funds purchased and securities sold under
  agreements to repurchase........................     1,730,657     58,869  4.55    1,378,322     54,128  5.25
 Other interest-bearing liabilities...............     3,775,196    150,060  5.31    3,448,590    145,304  5.63
                                                    ------------  ---------        -----------  ---------
 Total interest-bearing liabilities...............    16,385,044    540,220  4.41   15,749,482    576,831  4.90
                                                                  ---------  ----               --------- -----
 Net interest spread..............................                           3.54%                         3.32%
                                                                             ====                         =====
 Noninterest-bearing demand deposits..............     2,189,648                     1,968,371
 Other liabilities................................       337,262                       300,127
 Shareholders' equity.............................     1,429,064                     1,414,533
                                                    ------------                   -----------
                                                    $ 20,341,018                   $19,432,513
                                                    ============                   ===========
Net interest income/margin on a taxable equivalent
 basis............................................                  570,237  4.08%                524,146  3.91%
                                                                             ====                         =====
Taxable equivalent adjustment:
 Loans............................................                    1,232                         1,346
 Securities.......................................                    3,190                         2,997
                                                                  ---------                     ---------
 Total taxable equivalent adjustment..............                    4,422                         4,343
                                                                  ---------                     ---------
  Net interest income.............................                $ 565,815                     $ 519,803
                                                                  =========                     =========
</TABLE>
--------
NOTE: The taxable equivalent adjustment has been computed based on a 35%
      federal income tax rate and has given effect to the disallowance of
      interest expense, for federal income tax purposes, related to certain
      tax-free assets. Loans net of unearned income includes nonaccrual loans
      for all periods presented. Available-for-sale securities excludes certain
      noninterest-earning, marketable equity securities.

                                       20
<PAGE>

 Table 3--Quarterly Yields Earned on Average Interest-Earning Assets and Rates
                 Paid on Average Interest-Bearing Liabilities

<TABLE>
<CAPTION>
                                                           1999
                    --------------------------------------------------------------------------------------
                           Third Quarter               Second Quarter                First Quarter               Fourth Quarter
                    ---------------------------- ---------------------------- ---------------------------- ---------------------
                      Average    Revenue/ Yield/   Average    Revenue/ Yield/   Average    Revenue/ Yield/   Average    Revenue/
                      Balance    Expense   Rate    Balance    Expense   Rate    Balance    Expense   Rate    Balance    Expense
                    -----------  -------- ------ -----------  -------- ------ -----------  -------- ------ -----------  --------
                                                                 (Taxable equivalent basis--dollars in thousands)
<S>                 <C>          <C>      <C>    <C>          <C>      <C>    <C>          <C>      <C>    <C>          <C>
Assets
Interest-earning
assets:
 Loans net of
 unearned income..  $13,360,012  $286,564  8.51% $13,418,941  $280,477  8.38% $13,064,656  $271,204  8.42% $12,787,915  $276,196
 Available-for-
 sale securities..    3,542,904    59,751  6.69    3,126,831    52,916  6.79    2,864,766    49,016  6.94    3,044,713    52,318
 Held-to-maturity
 securities:
 Taxable..........    2,008,203    33,772  6.67    1,866,778    30,850  6.63    1,913,794    31,644  6.71    2,079,172    34,403
 Tax-free.........      166,791     3,513  8.36      148,369     3,102  8.39      127,462     2,857  9.09      114,211     2,672
                    -----------  --------        -----------  --------        -----------  --------        -----------  --------
 Total held-to-
 maturity
 securities.......    2,174,994    37,285  6.80    2,015,147    33,952  6.76    2,041,256    34,501  6.85    2,193,383    37,075
                    -----------  --------        -----------  --------        -----------  --------        -----------  --------
  Total investment
  securities......    5,717,898    97,036  6.73    5,141,978    86,868  6.78    4,906,022    83,517  6.90    5,238,096    89,393
 Other interest-
 earning assets...      110,616     1,392  4.99      124,037     1,645  5.32      150,425     1,754  4.73      138,838     1,615
                    -----------  --------        -----------  --------        -----------  --------        -----------  --------
 Total interest-
 earning assets...   19,188,526   384,992  7.96   18,684,956   368,990  7.92   18,121,103   356,475  7.98   18,164,849   367,204
Cash and other
assets............    1,876,465                    1,867,225                    1,835,590                    1,768,281
Allowance for loan
losses............     (177,814)                    (178,875)                    (176,554)                    (176,519)
Market valuation
on available-for-
sale securities...      (59,466)                       5,930                       24,728                       39,685
                    -----------                  -----------                  -----------                  -----------
                    $20,827,711                  $20,379,236                  $19,804,867                  $19,796,296
                    ===========                  ===========                  ===========                  ===========
Liabilities and
Shareholders'
Equity
Interest-bearing
liabilities:
 Interest-bearing
 demand deposits..  $ 4,481,863    35,389  3.13  $ 4,453,899    33,828  3.05  $ 4,445,859    33,380  3.04  $ 4,340,072    36,582
 Savings
 deposits.........      911,476     4,337  1.89      954,475     4,668  1.96      973,896     4,866  2.03      981,293     6,107
 Time deposits....    4,519,111    59,055  5.18    4,560,415    59,478  5.23    4,521,253    60,128  5.39    4,641,398    64,825
 Certificates of
 deposit of
 $100,000 or
 more.............      938,684    12,140  5.13      938,094    11,819  5.05      938,864    12,203  5.27    1,021,557    14,126
 Federal funds
 purchased and
 securities sold
 under agreements
 to repurchase....    1,849,722    21,849  4.69    1,803,325    20,170  4.49    1,535,469    16,850  4.45    1,478,217    17,693
 Other interest-
 bearing
 liabilities......    4,126,451    54,949  5.28    3,698,198    48,555  5.27    3,493,989    46,556  5.40    3,436,194    47,407
                    -----------  --------        -----------  --------        -----------  --------        -----------  --------
 Total interest-
 bearing
 liabilities......   16,827,307   187,719  4.43   16,408,406   178,518  4.36   15,909,330   173,983  4.44   15,898,731   186,740
                                 --------  ----               --------  ----               --------  ----               --------
Net interest
spread............                         3.53%                        3.56%                        3.54%
                                           ====                         ====                         ====
Noninterest-
bearing demand
deposits..........    2,228,826                    2,207,191                    2,131,862                    2,143,062
Other
liabilities.......      332,993                      336,898                      341,994                      335,663
Shareholders'
equity............    1,438,585                    1,426,741                    1,421,681                    1,418,840
                    -----------                  -----------                  -----------                  -----------
                    $20,827,711                  $20,379,236                  $19,804,867                  $19,796,296
                    ===========                  ===========                  ===========                  ===========
Net interest
income/margin on a
taxable equivalent
basis.............                197,273  4.08%               190,472  4.09%               182,492  4.08%               180,464
                                           ====                         ====                         ====
Taxable equivalent
adjustment:
 Loans............                    348                          465                          419                          410
 Securities.......                  1,185                        1,044                          961                          887
                                 --------                     --------                     --------                     --------
 Total taxable
 equivalent
 adjustment.......                  1,533                        1,509                        1,380                        1,297
                                 --------                     --------                     --------                     --------
  Net interest
  income..........               $195,740                     $188,963                     $181,112                     $179,167
                                 ========                     ========                     ========                     ========
<CAPTION>
                       1998
                    -----------------------------------
                                  Third Quarter
                           ----------------------------
                    Yield/   Average    Revenue/ Yield/
                     Rate    Balance    Expense   Rate
                    ------ ------------ -------- ------
<S>                 <C>    <C>          <C>      <C>
Assets
Interest-earning
assets:
 Loans net of
 unearned income..   8.57% $12,605,379  $275,905  8.68%
 Available-for-
 sale securities..   6.82    3,271,460    56,958  6.91
 Held-to-maturity
 securities:
 Taxable..........   6.56    2,217,506    37,154  6.65
 Tax-free.........   9.28      113,616     2,834  9.90
                           ------------ --------
 Total held-to-
 maturity
 securities.......   6.71    2,331,122    39,988  6.81
                           ------------ --------
  Total investment
  securities......   6.77    5,602,582    96,946  6.87
 Other interest-
 earning assets...   4.61      122,408     1,470  4.76
                           ------------ --------
 Total interest-
 earning assets...   8.02   18,330,369   374,321  8.10
Cash and other
assets............           1,653,319
Allowance for loan
losses............            (175,160)
Market valuation
on available-for-
sale securities...              40,383
                           ------------
                           $19,848,911
                           ============
Liabilities and
Shareholders'
Equity
Interest-bearing
liabilities:
 Interest-bearing
 demand deposits..   3.34  $ 4,132,755    37,924  3.64
 Savings
 deposits.........   2.47    1,002,891     7,343  2.90
 Time deposits....   5.54    4,787,203    67,869  5.62
 Certificates of
 deposit of
 $100,000 or
 more.............   5.49    1,111,031    15,969  5.70
 Federal funds
 purchased and
 securities sold
 under agreements
 to repurchase....   4.75    1,520,284    20,048  5.23
 Other interest-
 bearing
 liabilities......   5.47    3,577,479    50,202  5.57
                           ------------ --------
 Total interest-
 bearing
 liabilities......   4.66   16,131,643   199,355  4.90
                    ------              -------- ------
Net interest
spread............   3.36%                        3.20%
                    ======                       ======
Noninterest-
bearing demand
deposits..........           1,969,029
Other
liabilities.......             326,336
Shareholders'
equity............           1,421,903
                           ------------
                           $19,848,911
                           ============
Net interest
income/margin on a
taxable equivalent
basis.............   3.94%               174,966  3.79%
                    ======                       ======
Taxable equivalent
adjustment:
 Loans............                           522
 Securities.......                           930
                                        --------
 Total taxable
 equivalent
 adjustment.......                         1,452
                                        --------
  Net interest
  income..........                      $173,514
                                        ========
</TABLE>
----
NOTE: The taxable equivalent adjustment has been computed based on a 35%
      federal income tax rate and has given effect to the disallowance of
      interest expense, for federal income tax purposes, related to certain
      tax-free assets. Loans net of unearned income includes nonaccrual loans
      for all periods presented. Available-for-sale securities excludes
      certain noninterest-earning, marketable equity securities.

                                       21
<PAGE>

           Table 4--Maturities and Interest Rates Exchanged on Swaps

<TABLE>
<CAPTION>
                                        Mature During
                      --------------------------------------------------------
                      1999    2000   2001   2002   2003   2008   2009   Total
                      -----  ------  -----  -----  -----  -----  -----  ------
                                    (Dollars in millions)
<S>                   <C>    <C>     <C>    <C>    <C>    <C>    <C>    <C>
Receive fixed swaps:
  Notional amount...  $ 135  $1,019  $ 244  $  50  $ 115  $ 175  $ 150  $1,888
  Receive rate......   6.22%   6.34%  6.10%  6.26%  6.31%  6.13%  6.17%   6.27%
  Pay rate..........   5.37%   5.37%  4.84%  5.39%  5.38%  5.34%  5.37%    5.30%
</TABLE>
--------
NOTE:  The interest rates exchanged are calculated assuming that interest
       rates remain unchanged from September 30, 1999 rates and using call
       dates of swaps where applicable. The information presented could change
       as future interest rates increase or decrease.

                       Table 5--Loans and Credit Quality

<TABLE>
<CAPTION>
                                                                        Net Charge-offs
                                                                          Nine Months
                                 Loans*          Nonperforming Loans**  Ended September
                              September 30            September 30            30
                         ----------------------- ---------------------- ---------------
                            1999        1998        1999        1998     1999    1998
                         ----------- ----------- ----------- ---------- ------- -------
                                                 (In thousands)
<S>                      <C>         <C>         <C>         <C>        <C>     <C>
Commercial:
  Commercial &
   industrial........... $ 3,821,471 $ 3,607,687 $    51,753 $   19,224 $ 6,397 $ 5,357
  Commercial loans--
   secured by real
   estate...............     644,124     574,944       4,728      6,810     392     633
                         ----------- ----------- ----------- ---------- ------- -------
   Total commercial.....   4,465,595   4,182,631      56,481     26,034   6,789   5,990
                         ----------- ----------- ----------- ---------- ------- -------
Commercial real estate:
  Commercial real estate
   mortgages............   1,299,735   1,199,646      13,381     11,802      11    (672)
  Real estate
   construction.........   1,403,269   1,298,277       7,445      2,532     294     149
                         ----------- ----------- ----------- ---------- ------- -------
   Total commercial real
    estate..............   2,703,004   2,497,923      20,826     14,334     305    (523)
                         ----------- ----------- ----------- ---------- ------- -------
Consumer:
  Residential first
   mortgages............   1,066,364   1,883,539      17,326     26,487     803   1,079
  Other residential
   mortgages............   2,155,413   1,722,975      10,965      5,135   2,124   1,746
  Dealer indirect.......   2,591,647   1,529,581         260      1,316   9,410   4,678
  Revolving credit......     267,930     251,606         -0-        -0-   6,091  17,485
  Other consumer........     457,663     458,913         214        835   2,397   4,630
                         ----------- ----------- ----------- ---------- ------- -------
   Total consumer.......   6,539,017   5,846,614      28,765     33,773  20,825  29,618
                         ----------- ----------- ----------- ---------- ------- -------
                         $13,707,616 $12,527,168 $   106,072 $   74,141 $27,919 $35,085
                         =========== =========== =========== ========== ======= =======
</TABLE>
--------
*  Net of unearned income.
** Exclusive of accruing loans 90 days past due.



                                      22
<PAGE>

                       Table 6--Allowance for Loan Losses

<TABLE>
<CAPTION>
                                         1999                          1998
                          ----------------------------------- -----------------------
                          3rd Quarter 2nd Quarter 1st Quarter 4th Quarter 3rd Quarter
                          ----------- ----------- ----------- ----------- -----------
                                            (Dollars in thousands)
<S>                       <C>         <C>         <C>         <C>         <C>
Balance at beginning of
 period.................   $177,082    $176,595    $176,075    $175,046    $174,079
Loans charged off.......    (16,730)    (11,703)    (13,939)    (16,553)    (12,584)
Recoveries of loans
 previously charged
 off....................      4,804       4,690       4,959       5,282       5,551
                           --------    --------    --------    --------    --------
Net charge-offs.........    (11,926)     (7,013)     (8,980)    (11,271)     (7,033)
Addition to allowance
 charged to expense.....     12,400       7,500       9,500      12,300       8,000
                           --------    --------    --------    --------    --------
Balance at end of
 period.................   $177,556    $177,082    $176,595    $176,075    $175,046
                           ========    ========    ========    ========    ========
Allowance for loan
 losses to loans net of
 unearned income........       1.30%       1.35%       1.34%       1.37%       1.40%
Allowance for loan
 losses to nonperforming
 loans..................     167.39%     215.08%     265.24%     266.49%     236.10%
Allowance for loan
 losses to nonperforming
 assets.................     143.74%     187.54%     227.85%     228.26%     207.57%
Net charge-offs to
 average loans net of
 unearned income
 (annualized)...........       0.35%       0.21%       0.28%       0.35%       0.22%
</TABLE>

                         Table 7--Nonperforming Assets

<TABLE>
<CAPTION>
                                      1999                          1998
                          ------------------------------  ------------------------
                          September 30 June 30  March 31  December 31 September 30
                          ------------ -------  --------  ----------- ------------
                                          (Dollars in thousands)
<S>                       <C>          <C>      <C>       <C>         <C>
Nonaccrual loans........    $106,072   $82,334  $66,580     $66,072     $74,141
Foreclosed properties...      15,962    10,389   10,020      10,237       9,225
Repossessions...........       1,496     1,701      904         828         967
                            --------   -------  -------     -------     -------
 Total nonperforming
  assets*...............    $123,530   $94,424  $77,504     $77,137     $84,333
                            ========   =======  =======     =======     =======
Nonperforming assets* to
 loans net of unearned
 income, foreclosed
 properties and
 repossessions..........        0.90%     0.72%    0.59%       0.60%       0.67%
Accruing loans 90 days
 past due...............    $ 25,736   $24,133  $26,077     $23,832     $29,586
</TABLE>
--------
* Exclusive of accruing loans 90 days past due.


                                       23
<PAGE>

                        Table 8--Investment Securities

<TABLE>
<CAPTION>
                                     September 30, 1999    September 30, 1998
                                    --------------------- ---------------------
                                     Carrying    Market    Carrying    Market
                                      Amount     Value      Amount     Value
                                    ---------- ---------- ---------- ----------
                                                  (In thousands)
<S>                                 <C>        <C>        <C>        <C>
Held-to-maturity:
 U.S. Treasury and federal agency
  securities....................... $1,762,111 $1,733,285 $1,983,032 $2,010,063
 State, county and municipal
  securities.......................    190,452    179,991    125,751    129,483
 Other securities..................    217,459    213,714    188,308    188,894
                                    ---------- ---------- ---------- ----------
                                    $2,170,022 $2,126,990 $2,297,091 $2,328,440
                                    ========== ========== ========== ==========
Available-for-sale:
 U.S. Treasury and federal agency
  securities....................... $3,113,323            $2,967,937
 Other securities..................    467,845               313,192
                                    ----------            ----------
                                    $3,581,168            $3,281,129
                                    ==========            ==========
</TABLE>
--------
NOTES:
1. The weighted average remaining life, which reflects the amortization on
   mortgage related and other asset-backed securities, and the weighted
   average yield on the combined held-to-maturity and available-for-sale
   portfolios at September 30, 1999, were approximately 5.7 years and 6.80%,
   respectively. Included in the combined portfolios was $3.8 billion of
   mortgage-backed securities, $311 million of which were variable rate. The
   weighted-average remaining life and the weighted-average yield of mortgage-
   backed securities at September 30, 1999, were approximately 5.4 years and
   6.77%, respectively. The duration of the combined portfolios, which
   considers the repricing frequency of variable rate securities, is
   approximately 3.6 years.
2. The available-for-sale portfolio included net unrealized gains (losses) of
   $(65.3) million and $54.0 million at September 30, 1999 and 1998,
   respectively.

                  Table 9--Other Interest-Bearing Liabilities

<TABLE>
<CAPTION>
                                                                September 30
                                                              -----------------
                                                                1999     1998
                                                              -------- --------
                                                               (In thousands)
<S>                                                           <C>      <C>
Other borrowed funds:
 Treasury, tax and loan notes................................ $139,958 $    100
 Short-term bank notes.......................................  250,000  125,000
 Other short-term debt.......................................   14,619  187,056
                                                              -------- --------
  Total other borrowed funds................................. $404,577 $312,156
                                                              ======== ========
Other long-term debt:
 6.75% Subordinated Debentures Due 2025...................... $149,893 $149,876
 6.45% Subordinated Notes Due 2018...........................  304,145  304,642
 6.125% Subordinated Notes Due 2009..........................  174,315      -0-
 7.75% Subordinated Notes Due 2004...........................  149,572  149,480
 Subordinated Capital Notes Due 1999.........................      -0-   99,925
 Long-term notes payable.....................................   10,880   35,880
                                                              -------- --------
  Total other long-term debt................................. $788,805 $739,803
                                                              ======== ========
</TABLE>


                                      24
<PAGE>

                      Table 10--Capital Amounts and Ratios

<TABLE>
<CAPTION>
                                                       September 30
                                             ----------------------------------
                                                   1999              1998
                                             ----------------  ----------------
                                               Amount   Ratio    Amount   Ratio
                                             ---------- -----  ---------- -----
                                                  (Dollars in thousands)
<S>                                          <C>        <C>    <C>        <C>
Tier 1 capital:
  AmSouth................................... $1,288,765  6.60% $1,164,901  6.91%
  AmSouth Bank..............................  1,601,921  8.23   1,477,188  8.92
Total capital:
  AmSouth................................... $2,110,704 10.81% $1,922,398 11.40%
  AmSouth Bank..............................  2,079,477 10.68   1,952,234 11.79
Leverage:
  AmSouth................................... $1,288,765  6.25% $1,164,901  5.94%
  AmSouth Bank..............................  1,601,921  7.79   1,477,188  7.54
</TABLE>

                                       25
<PAGE>

                                    PART II

                               OTHER INFORMATION

Item 1. Legal Proceedings

   Several of AmSouth's subsidiaries are defendants in legal proceedings
arising in the ordinary course of business. Some of these proceedings seek
relief or damages that are substantial. The actions relate to AmSouth's
lending, collections, loan servicing, deposit taking, investment, trust and
other activities.

   Among the actions which are pending against AmSouth subsidiaries are
actions filed as class actions in the State of Alabama. The actions are
similar to others that have been brought in recent years in Alabama against
financial institutions in that they seek punitive damage awards in
transactions involving relatively small amounts of actual damages. In recent
years, juries in Alabama State courts have made large punitive damage awards
in such cases. Legislation was recently enacted in Alabama that is designed to
limit the potential amount of punitive damages that can be recovered in
individual cases in the future. However, AmSouth cannot predict the exact
effect of the legislation at this time.

   It may take a number of years to finally resolve some of these legal
proceedings pending against AmSouth subsidiaries, due to their complexity and
for other reasons. It is not possible to determine with any certainty at this
time the corporation's potential exposure from the proceedings. At times,
class actions are settled by defendants without admission or even an actual
finding of wrongdoing but with payment of some compensation to purported class
members and large attorney's fees to plaintiff class counsel. Nonetheless,
based upon the advice of legal counsel, AmSouth's management is of the opinion
that the ultimate resolution of these legal proceedings will not have a
material adverse effect on AmSouth's financial condition or results of
operations.

Item 4. Submission of Matters to a Vote of Security Holders

   A Special Meeting of Shareholders of AmSouth was held on September 16,
1999, at which the shareholders approved (i) an amendment to AmSouth's
Restated Certificate of Incorporation to increase the number of shares of
authorized common stock, and (ii) the issuance of AmSouth's common stock
pursuant to an Agreement and Plan of Merger dated as of May 31, 1999, with
First American Corporation. The following is a tabulation of the voting on
this matter.

              AMENDMENT OF RESTATED CERTIFICATE OF INCORPORATION

<TABLE>
<CAPTION>
                       Votes                Broker
         Votes For    Against  Abstentions Nonvotes
         ---------    -------  ----------- --------
        <S>          <C>       <C>         <C>
        119,062,771  7,595,676   629,118       0
</TABLE>

                       ISSUANCE OF AMSOUTH COMMON STOCK

<TABLE>
<CAPTION>
                       Votes                Broker
         Votes For    Against  Abstentions Nonvotes
         ---------    -------  ----------- --------
        <S>          <C>       <C>         <C>
        118,972,536  7,558,617   756,412       0
</TABLE>

Item 5. Other Information

   On October 1, 1999, AmSouth completed the acquisition of First American
Corporation pursuant to the Agreement and Plan of Merger with First American
Corporation. As a result, each outstanding share of common stock of First
American Corporation will be converted into 1.871 shares of AmSouth's common
stock. More information concerning the transaction may be found in the Notes
to Financial Statements that are part of this Form 10-Q.

                                      26
<PAGE>

Item 6. Exhibits and Reports on Form 8-K

  Item 6(a)--Exhibits

   The exhibits listed in the Exhibit Index at page 29 of this Form 10-Q are
filed herewith or are incorporated by reference herein.

  Item 6(b)--Reports on Form 8-K

   Two reports on Form 8-K were filed by AmSouth during the period July 1,
1999 to September 30, 1999:

      (a) A report was filed on July 28, 1999 to report AmSouth's preliminary
  results of operations for the second quarter of 1999.

      (b) A report was filed on August 26, 1999 relating to certain investor
  presentation materials used by AmSouth.

                                      27
<PAGE>

                                   SIGNATURES

   Pursuant to the requirements of the Securities Exchange Act of 1934, AmSouth
has duly caused this report to be signed on its behalf by the undersigned
thereunto duly authorized.

                                                   /s/ C. Dowd Ritter
November 16, 1999                         By: _________________________________
                                                      C. Dowd Ritter
                                               President and Chief Executive
                                                          Officer

November 16, 1999                              /s/ Robert R. Windelspecht
                                          By: _________________________________
                                             Robert R. Windelspecht
                                             Executive Vice President and
                                             Controller

                                       28
<PAGE>

                                 EXHIBIT INDEX

   The following is a list of exhibits including items incorporated by
reference.

   2    Agreement and Plan of Merger, dated May 31, 1999 (1)

   3-a  Restated Certificate of Incorporation of AmSouth Bancorporation (2)

   3-b  By-Laws of AmSouth Bancorporation (3)

   15   Letter Re: Unaudited Interim Financial Information

   27   Financial Data Schedule

                               NOTES TO EXHIBITS

(1) Filed as Exhibit 2.1 to AmSouth's Report on Form 8-K filed June 8, 1999,
    incorporated herein by reference.
(2) Filed as Exhibit 3.1 to AmSouth's Report on Form 8-K filed October 15,
    1999, incorporated herein by reference.
(3) Filed as Exhibit 3-b to AmSouth's Form 10-Q Quarterly Report for the
    quarter ended June 30, 1997, incorporated herein by reference.

                                      29