Exhibit (19)




---



##### 



WACHOVIA CORPORATION AND SUBSIDIARIES
QUARTERLY FINANCIAL SUPPLEMENT
THREE MONTHS ENDED MARCH 31, 2008
TABLE OF CONTENTS
 
 PAGEFinancial Highlights
    
    
    1Managements
Discussion and Analysis
    
    
    2Explanation of Our Use of Non-GAAP Financial Measures
    
    
    35Selected Statistical Data
    
    
    36Summaries of Income, Per Common Share and Balance Sheet Data
    
    
    37Merger-Related and Restructuring Expenses
    
    
    38Business Segments
    
    
    39Net Trading Revenue  Investment Banking
    
    
    47Selected Ratios
    
    
    47Trading Account Assets and Liabilities
    
    
    48Loans  On-Balance Sheet, and Managed and Servicing Portfolios
    
    
    49Loans Held for Sale
    
    
    50Allowance for Credit Losses
    
    
    51Allowance and Charge-Off Ratios
    
    
    52Nonperforming Assets
    
    
    53Nonaccrual Loan Activity
    
    
    54Goodwill and Other Intangible Assets
    
    
    55Deposits
    
    
    56Time Deposits in Amounts of $100,000 or More
    
    
    56Long-Term Debt
    
    
    57Changes in Stockholders Equity
    
    
    58Capital Ratios
    
    
    59Net Interest
Income Summaries  Five Quarters Ended March 31, 2008
    
    
    60Consolidated
Balance Sheets  Five Quarters Ended March 31, 2008
    
    
    62Consolidated
Statements of Income   Five Quarters Ended March 31, 2008
    
    
    63Wachovia Corporation and Subsidiaries  Consolidated Financial Statements
    
    
    64




---



##### 



FINANCIAL HIGHLIGHTS
 Three Months Ended
    
    
    PercentMarch 31,
    
    
    Increase(Dollars in millions, except per share data)
    
    2008
    
    
    2007
    
    
    (Decrease)EARNINGS SUMMARYNet interest income (GAAP)
    
    $
    4,752
    
    
    
    4,500
    
    
    
    6
    %Tax-equivalent adjustment
    
    
    53
    
    
    
    37
    
    
    
    43Net interest income (Tax-equivalent)
    
    
    4,805
    
    
    
    4,537
    
    
    
    6Fee and other income
    
    
    2,777
    
    
    
    3,734
    
    
    
    (26
    )Total revenue (Tax-equivalent)
    
    
    7,582
    
    
    
    8,271
    
    
    
    (8
    )Provision for credit losses
    
    
    2,831
    
    
    
    177
    
    
    
    Other noninterest expense
    
    
    5,097
    
    
    
    4,493
    
    
    
    13Merger-related and restructuring expenses
    
    
    241
    
    
    
    10
    
    
    
    Other intangible amortization
    
    
    103
    
    
    
    118
    
    
    
    (13
    )Total noninterest expense
    
    
    5,441
    
    
    
    4,621
    
    
    
    18Minority interest in income of consolidated subsidiaries
    
    
    155
    
    
    
    136
    
    
    
    14Income (loss) before income taxes (benefits) (Tax-equivalent)
    
    
    (845
    )
    
    
    3,337
    
    
    
    Tax-equivalent adjustment
    
    
    53
    
    
    
    37
    
    
    
    43Income taxes (benefits)
    
    
    (234
    )
    
    
    998
    
    
    
    Net income (loss)
    
    
    (664
    )
    
    
    2,302
    
    
    
    Dividends on preferred stock
    
    
    43
    
    
    
    
    
    
    
    Net income (loss) available to common stockholders
    
    $
    (707
    )
    
    
    2,302
    
    
    
    
    %Diluted earnings per common share (a)Net income (loss) available to common stockholders
    
    $
    (0.36
    )
    
    
    1.20
    
    
    
    
    %Return on average common stockholders equity
    
    
    (3.81
    )%
    
    
    13.47
    
    
    
    Return on average total stockholders equity
    
    
    (3.39
    )
    
    
    13.47
    
    
    
    Return on average assets (b)
    
    
    (0.34
    )%
    
    
    1.35
    
    
    
    ASSET QUALITYAllowance for loan losses as % of loans, net
    
    
    1.37
    %
    
    
    0.80
    
    
    
    Allowance for loan losses as % of nonperforming assets
    
    
    78
    
    
    
    189
    
    
    
    Allowance for credit losses as % of loans, net
    
    
    1.41
    
    
    
    0.84
    
    
    
    Net charge-offs as % of average loans, net
    
    
    0.66
    
    
    
    0.15
    
    
    
    Nonperforming assets as % of loans, net, foreclosed properties and loans held for sale
    
    
    1.70
    %
    
    
    0.42
    
    
    
    CAPITAL ADEQUACYTier I capital ratio
    
    
    7.42
    %
    
    
    7.35
    
    
    
    Total capital ratio
    
    
    12.05
    
    
    
    11.41
    
    
    
    Leverage ratio
    
    
    6.18
    %
    
    
    6.08
    
    
    
    OTHER FINANCIAL DATANet interest margin
    
    
    2.92
    %
    
    
    3.06
    
    
    
    Fee and other income as % of total revenue
    
    
    36.62
    
    
    
    45.15
    
    
    
    Effective income tax rate
    
    
    26.02
    %
    
    
    30.22
    
    
    
    BALANCE SHEET DATASecurities
    
    $
    114,183
    
    
    
    106,841
    
    
    
    7
    %Loans, net
    
    
    480,482
    
    
    
    421,663
    
    
    
    14Total assets
    
    
    808,575
    
    
    
    702,669
    
    
    
    15Total deposits
    
    
    444,964
    
    
    
    405,270
    
    
    
    10Long-term debt
    
    
    175,653
    
    
    
    142,334
    
    
    
    23Stockholders equity
    
    $
    77,992
    
    
    
    69,786
    
    
    
    12
    %OTHER DATAAverage basic common shares (In millions)
    
    
    1,963
    
    
    
    1,894
    
    
    
    4
    %Average diluted common shares (In millions)
    
    
    1,977
    
    
    
    1,925
    
    
    
    3Actual common shares (In millions)
    
    
    1,992
    
    
    
    1,913
    
    
    
    4Dividends paid per common share
    
    $
    0.64
    
    
    
    0.56
    
    
    
    14Dividend payout ratio on common shares
    
    
    (177.78
    )%
    
    
    46.67
    
    
    
    Book value per common share
    
    $
    36.24
    
    
    
    36.47
    
    
    
    (1
    )Common stock price
    
    
    27.00
    
    
    
    55.05
    
    
    
    (51
    )Market capitalization
    
    $
    53,782
    
    
    
    105,330
    
    
    
    (49
    )Common stock price to book value
    
    
    75
    %
    
    
    151
    
    
    
    (50
    )FTE employees
    
    
    120,378
    
    
    
    110,369
    
    
    
    9Total financial centers/brokerage offices
    
    
    4,850
    
    
    
    4,167
    
    
    
    16ATMs
    
    
    5,308
    
    
    
    5,146
    
    
    
    3
    %
   1




---



##### 



Managements Discussion and Analysis
  Executive Summary
 Summary of Results of Operations
 Three Months EndedMarch 31,(In millions, except per share data)
    
    2008
    
    
    2007Net interest income (GAAP)
    
    $
    4,752
    
    
    
    4,500Tax-equivalent adjustment
    
    
    53
    
    
    
    37Net interest income (a)
    
    
    4,805
    
    
    
    4,537Fee and other income
    
    
    2,777
    
    
    
    3,734Total revenue (a)
    
    
    7,582
    
    
    
    8,271Provision for credit losses
    
    
    2,831
    
    
    
    177Other noninterest expense
    
    
    5,097
    
    
    
    4,493Merger-related and restructuring expenses
    
    
    241
    
    
    
    10Other intangible amortization
    
    
    103
    
    
    
    118Total noninterest expense
    
    
    5,441
    
    
    
    4,621Minority
interest in income of consolidated subsidiaries
    
    
    155
    
    
    
    136Income taxes (benefits)
    
    
    (234
    )
    
    
    998Tax-equivalent adjustment
    
    
    53
    
    
    
    37Net income (loss)
    
    
    (664
    )
    
    
    2,302Dividends on preferred stock
    
    
    43
    
    
    
    Net income (loss) available to common stockholders
    
    
    (707
    )
    
    
    2,302Diluted earnings per common share
    
    $
    (0.36
    )
    
    
    1.20
 (a)
    
    Tax-equivalent.
 Market Disruption, Fee Income Parent
   
    
    A public offering of an aggregate $8.05 billion in capital consisting of concurrent
offerings of common stock and noncumulative perpetual convertible preferred stock, and
    
    A reduction in the quarterly common stock dividend, which preserves approximately $2.1
billion of capital annually.
 2




---



##### 



Note 1 Consolidated Financial Statements Note 1 Consolidated Financial Statements
  Fair
Value Measurements, The Fair Value Option for Financial Assets and Financial
Liabilities.
 Note 1 Consolidated Financial Statements.
 Market Disruption-Related Losses Market Disruption-Related Losses, Net
 3




---



##### 



Market Disruption-Related Losses, Net
 2008
    
    
    2007First Quarter
    
    
    2nd Half
    
    
    CumulativeTrading
    
    
    Securitiesprofits
    
    
    gains
    
    
    Other(Pre-tax dollars in millions)
    
    (losses)
    
    
    (losses)
    
    
    Income
    
    
    Total
    
    
    Total
    
    
    TotalCorporate and Investment BankABS CDO and other
subprime-related
    
    $
    (281
    )
    
    
    (67
    )
    
    
    9
    
    
    
    (339
    )
    
    
    (1,048
    )
    
    
    (1,387
    )Commercial mortgage (CMBS)
    
    
    (283
    )
    
    
    
    
    
    
    (238
    )
    
    
    (521
    )
    
    
    (1,088
    )
    
    
    (1,609
    )Consumer mortgage
    
    
    (187
    )
    
    
    
    
    
    
    (64
    )
    
    
    (251
    )
    
    
    (205
    )
    
    
    (456
    )Leveraged finance
    
    
    483
    
    
    
    
    
    
    
    (792
    )
    
    
    (309
    )
    
    
    (179
    )
    
    
    (488
    )Other
    
    
    (131
    )
    
    
    (4
    )
    
    
    (9
    )
    
    
    (144
    )
    
    
    (50
    )
    
    
    (194
    )Total
    
    
    (399
    )
    
    
    (71
    )
    
    
    (1,094
    )
    
    
    (1,564
    )
    
    
    (2,570
    )
    
    
    (4,134
    )Capital ManagementAsset-backed commercial paper
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (57
    )
    
    
    (57
    )ParentSecurities impairment losses
    
    
    
    
    
    
    (409
    )
    
    
    
    
    
    
    (409
    )
    
    
    (94
    )
    
    
    (503
    )Valuation losses on BOLI contracts
    
    
    
    
    
    
    
    
    
    
    (314
    )
    
    
    (314
    )
    
    
    
    
    
    
    (314
    )Total, net
    
    $
    (399
    )
    
    
    (480
    )
    
    
    (1,408
    )
    
    
    (2,287
    )
    
    
    (2,721
    )
    
    
    (5,008
    )Discontinued
operations (BluePoint)
    
    $
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (330
    )
    
    
    (330
    )
     4




---



##### 



Subprime-related, CMBS and Leveraged Finance  Distribution Exposure, Net
 3/31/08Exposure3/31/08
    
    
    Hedged With
    
    
    3/31/08
    
    
    12/31/07Gross
    
    
    Various
    
    
    Net
    
    
    Net($ in millions)
    
    Exposure
    
    
    Instruments
    
    
    Exposure
    
    
    ExposureABS CDO-related exposures:Super senior ABS CDO exposuresHigh grade
    
    $
    2,403
    
    
    
    (2,403
    )
    
    
    
    
    
    
    Mezzanine
    
    
    2,038
    
    
    
    (1,599
    )
    
    
    439
    
    
    
    613CDO-squared
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Total super senior ABS CDO exposures
    
    
    4,441
    
    
    
    (4,002
    )
    
    
    439
    
    
    
    613Other retained ABS CDO-related exposures
    
    
    67
    
    
    
    
    
    
    
    67
    
    
    
    208Total ABS CDO-related exposures (a)
    
    
    4,508
    
    
    
    (4,002
    )
    
    
    506
    
    
    
    821Subprime RMBS exposures:AAA rated
    
    
    1,684
    
    
    
    
    
    
    
    1,684
    
    
    
    1,948Below AAA
rated (net of hedges) (b)
    
    
    (365
    )
    
    
    
    
    
    
    (365
    )
    
    
    (253
    )Total subprime RMBS exposures
    
    
    1,319
    
    
    
    
    
    
    
    1,319
    
    
    
    1,695Total subprime-related exposure
    
    
    5,827
    
    
    
    (4,002
    )
    
    
    1,825
    
    
    
    2,516Commercial mortgage-related (CMBS)
    
    
    3,793
    
    
    
    (840
    )
    
    
    2,953
    
    
    
    7,564Leveraged finance (net of applicable fees)
    
    $
    n.a.
    
    
    
    n.a.
    
    
    
    8,157
    
    
    
    9,149
 (a)
    
    At 3/ 31/ 08, $2.0 billion is hedged with highly rated
monoline financial guarantors; $900 million with a AA-rated
large European bank, under margin agreements; and $1.1 billion with a large AA-rated
global multi-line insurer, under margin agreements.(b)
    
    Net short position due to hedging activities.
       5




---



##### 



Parent
 Corporate Results
of Operations Net Interest Income and Margin Fee Income Corporate and Investment Bank Outlook
 Other Earnings Factors
 Growth Trends
 
    
    6 percent higher net interest income, driven by higher loans and deposits, despite a 14
basis point decline in the margin that largely reflected customer preference for fixed
rate deposits and loans in a rising rate environment as well as the effect of higher
wholesale borrowing costs and increased liquidity levels.
    
    Strength in fiduciary and asset management fees and in brokerage commissions,
reflecting the A.G. Edwards acquisition and organic growth, as well as higher traditional
banking fees. These results were muted by a 17 percent decline in fee and other income as
a result of the market disruption-related valuation losses of $2.3 billion, somewhat
offset by $445 million of net gains from the January 1, 2008, adoption and application of
new fair value accounting standards and the $225 million Visa initial public offering
gain.
 Corporate and Investment Bank
  6




---



##### 



7




---



##### 



Stockholders Equity
 Outlook
    
    
    Net interest income will grow approximately 5 percent to 7 percent in the second
quarter of 2008 compared with the first quarter of 2008, and then grow slightly over the
rest of 2008 reflecting the benefits of our liability sensitive interest rate positioning,
modest loan growth, continued deposit growth including growth in FDIC sweep deposits, the
capital issuance and a lower dividend rate.
    
    Fee income will remain exposed to net market disruption losses/gains.
    
    Higher charge-offs and continued increases in the allowance throughout the rest of 2008.
    
    An after-tax noncash charge of between $800 million and
$1 billion in the second quarter of 2008, related to SILO
transactions, as noted earlier.
    
    An effective income tax rate (updated subsequent to our first quarter 2008 earnings
release in April 2008) of approximately 32.5 percent to 33 percent on a tax-equivalent
basis.
    
    No share repurchases in the rest of 2008. We estimate that
our second quarter 2008 common and convertible preferred issuances
will increase our 2008 fully diluted shares by approximately 120
million related to the common issuance and an insignificant amount for
the convertible preferred issuance.
 8




---



##### 



Critical Accounting Policies
  Corporate Results of Operations
 Average Balance Sheets and Interest Rates
 Three Months Ended
    
    
    Three Months EndedMarch 31, 2008
    
    
    March 31, 2007Average
    
    
    Interest
    
    
    Average
    
    
    Interest(In millions)
    
    Balances
    
    
    Rates
    
    
    Balances
    
    
    RatesInterest-bearing bank balances
    
    $
    4,253
    
    
    
    4.85
    %
    
    $
    1,523
    
    
    
    7.80
    %Federal funds sold
    
    
    11,865
    
    
    
    3.49
    
    
    
    14,124
    
    
    
    5.07Trading account assets
    
    
    44,655
    
    
    
    5.28
    
    
    
    29,681
    
    
    
    5.97Securities
    
    
    110,401
    
    
    
    5.60
    
    
    
    108,071
    
    
    
    5.42Commercial loans, net
    
    
    198,578
    
    
    
    5.72
    
    
    
    157,288
    
    
    
    7.15Consumer loans, net
    
    
    267,358
    
    
    
    7.04
    
    
    
    257,973
    
    
    
    7.55Total loans, net
    
    
    465,936
    
    
    
    6.48
    
    
    
    415,261
    
    
    
    7.40Loans held for sale
    
    
    11,592
    
    
    
    7.71
    
    
    
    16,748
    
    
    
    6.16Other earning assets
    
    
    10,331
    
    
    
    5.69
    
    
    
    8,255
    
    
    
    6.82Risk management derivatives
    
    
    
    
    
    
    0.04
    
    
    
    
    
    
    
    0.03Total earning assets
    
    
    659,033
    
    
    
    6.23
    
    
    
    593,663
    
    
    
    6.90Interest-bearing deposits
    
    
    387,021
    
    
    
    3.03
    
    
    
    338,130
    
    
    
    3.63Federal funds purchased
    
    
    35,956
    
    
    
    3.45
    
    
    
    35,142
    
    
    
    4.97Commercial paper
    
    
    5,509
    
    
    
    2.74
    
    
    
    4,920
    
    
    
    4.72Securities sold short
    
    
    6,919
    
    
    
    3.63
    
    
    
    8,709
    
    
    
    3.86Other short-term borrowings
    
    
    10,154
    
    
    
    1.77
    
    
    
    6,898
    
    
    
    2.54Long-term debt
    
    
    165,540
    
    
    
    4.75
    
    
    
    141,979
    
    
    
    5.35Risk management derivatives
    
    
    
    
    
    
    0.06
    
    
    
    
    
    
    
    0.09Total interest-bearing liabilities
    
    
    611,099
    
    
    
    3.57
    
    
    
    535,778
    
    
    
    4.26Net interest income and margin
    
    $
    4,805
    
    
    
    2.92
    %
    
    $
    4,537
    
    
    
    3.06
    %
 Net Interest Income and Margin
  9




---



##### 



Interest Rate Risk Management
  Fee and Other Income
 Three Months EndedMarch 31,(In millions)
    
    2008
    
    
    2007Service charges
    
    $
    676
    
    
    
    614Other banking fees
    
    
    498
    
    
    
    416Commissions
    
    
    914
    
    
    
    659Fiduciary and asset management fees
    
    
    1,439
    
    
    
    953Advisory, underwriting and other investment banking fees
    
    
    261
    
    
    
    407Trading account profits (losses)
    
    
    (308
    )
    
    
    128Principal investing
    
    
    446
    
    
    
    48Securities gains (losses)
    
    
    (205
    )
    
    
    53Other income
    
    
    (944
    )
    
    
    456Total fee and other income
    
    $
    2,777
    
    
    
    3,734
 Fee and Other Income
 
    
    Service charge growth was driven by strength in consumer service charges on higher
volume and improved pricing, while commercial service charges rose on increased volume.
    
    Other banking fees rose largely due to strength in mortgage banking income and
interchange fees.
    
    Higher commissions reflected the addition of A.G. Edwards, partially offset by lower
transactional revenue as well as lower insurance commissions.
    
    Increased fiduciary and asset management fees were driven by continued growth in retail
brokerage managed account and other asset-based fees, trust and investment fees, and the
addition of A.G. Edwards and ECM.
 10




---



##### 




    
    Advisory and underwriting results declined from a strong first quarter a year ago
driven by lower origination activity in businesses affected by the market disruption,
partially offset by strong results in high grade, global rate products and equities
despite market weakness.
    
    Trading account losses of $308 million driven by $399 million of market disruption
losses, including:
 o
    
    $281 million in subprime residential asset-backed CDOs and other
subprime-related products largely relating to losses in warehouse positions.o
    
    $283 million in commercial mortgage structured products.o
    
    $187 million in consumer mortgage structured products.o
    
    $483 million of hedging gains in leveraged finance.o
    
    $131 million in non-subprime collateralized debt obligations and
other structured products.
 
 
    
    Principal investing results were up from the year ago quarter largely due to the $486
million of net gains related to the adoption and application of new fair value accounting
standards.
    
    Net securities losses were $205 million compared with gains of $53 million in the year
ago quarter. Results included market-disruption impairment losses of $480 million,
partially offset by the $225 million gain related to the Visa initial public offering.
  Noninterest Expense
 Three Months EndedMarch 31,(In millions)
    
    2008
    
    
    2007Salaries and employee benefits
    
    $
    3,260
    
    
    
    2,972Occupancy
    
    
    379
    
    
    
    312Equipment
    
    
    323
    
    
    
    307Marketing
    
    
    97
    
    
    
    62Communications and supplies
    
    
    186
    
    
    
    173Professional and consulting fees
    
    
    196
    
    
    
    177Sundry expense
    
    
    656
    
    
    
    490Other noninterest expense
    
    
    5,097
    
    
    
    4,493Merger-related and restructuring expenses
    
    
    241
    
    
    
    10Other intangible amortization
    
    
    103
    
    
    
    118Total noninterest expense
    
    $
    5,441
    
    
    
    4,621
 Noninterest Expense
 11




---



##### 



Merger-Related and Restructuring Expenses
 Income Taxes
 Business Segments
   
    
    In the General Bank, an increase of $194 million.
    
    In Wealth Management, an increase of $26 million.
    
    In the Corporate and Investment Bank, an increase of $329 million.
    
    In Capital Management, an increase of $76 million.
    
    In the Parent, a decrease of $625 million, which included $230 million in 2007 losses from discontinued operations excluded from core
segment earnings; previously, this amount was included in Corporate and Investment Bank
segment earnings.
 12




---



##### 



General Bank  Performance Summary
 Three Months EndedMarch 31,(Dollars in millions)
    
    2008
    
    
    2007Income statement dataNet interest income (Tax-equivalent)
    
    $
    3,455
    
    
    
    3,398Fee and other income
    
    
    990
    
    
    
    845Intersegment revenue
    
    
    55
    
    
    
    47Total revenue (Tax-equivalent)
    
    
    4,500
    
    
    
    4,290Provision for credit losses
    
    
    569
    
    
    
    147Noninterest expense
    
    
    2,050
    
    
    
    1,869Income taxes (Tax-equivalent)
    
    
    686
    
    
    
    830Segment earnings
    
    $
    1,195
    
    
    
    1,444Performance and other dataEconomic profit
    
    $
    997
    
    
    
    1,123Risk adjusted return on capital (RAROC)
    
    
    42.58
    %
    
    
    53.73Economic capital, average
    
    $
    12,695
    
    
    
    10,662Cash overhead efficiency ratio (Tax-equivalent)
    
    
    45.55
    %
    
    
    43.56Lending commitments
    
    $
    132,165
    
    
    
    124,253Average loans, net
    
    
    311,447
    
    
    
    288,229Average core deposits
    
    $
    297,680
    
    
    
    284,046FTE employees
    
    
    54,847
    
    
    
    56,722
 General Bank
 
    
    Average loan growth of 8 percent, with double digit growth in wholesale businesses and
consumer installment loans, and 6 percent growth in consumer real estate, as a decline in
prepayments offset lower volumes in the payment option mortgage product.
 o
    
    Significant efforts in our mortgage business to mitigate risk in the
face of declining housing markets, by restructuring its operating model,
implementing extensive loss mitigation efforts and undertaking initiatives to
increase the volume of marketable mortgages.o
    
    Reduced home equity originations, reflecting efforts to improve the
efficiency of originations and implementation of tightened credit standards. Over
95 percent of our home equity loans are originated through our branch network and
other direct channels.o
    
    A 26 percent increase in auto originations with continued focus on
increasing credit scores.
 
    
    Average core deposit growth of 5 percent, largely reflecting strength in wholesale
deposits, which were up 10 percent, and an increase of 4 percent in retail deposits.
 o
    
    Growth in net new retail checking accounts, reflecting continued
benefits from retention and acquisition efforts resulting in a still strong
increase of 174,000 in
 13




---



##### 



the first quarter of 2008 compared with an increase of
268,000 in the first quarter of 2007.o
    
    Net new checking accounts include 139,000 linked to the new Way2Save
accounts, which launched in mid-January 2008.
 
    
    17 percent growth in fee and other income, with strength in service charges,
interchange income and mortgage banking fee income. Strong interchange income reflected an
18 percent increase in debit/credit card volume from the first quarter of 2007.
    
    Noninterest expense up 10 percent due to growth in credit-related sundry expense, as
well as continued strategic investment in de novo branch activity, Western expansion and
buildup in credit card operations. During the first quarter of 2008, 23 de novo branches
were opened and 58 branches were consolidated. As a result of performance initiatives,
operating leverage continued to improve, which enabled the continued strategic investment.
    
    $422 million increase in the provision for credit losses largely reflecting rapid
deterioration in consumer real estate in certain housing markets and higher losses in auto
loans.
 Wealth Management
 Performance Summary
 Three Months EndedMarch 31,(Dollars in millions)
    
    2008
    
    
    2007Income statement dataNet interest income (Tax-equivalent)
    
    $
    181
    
    
    
    181Fee and other income
    
    
    211
    
    
    
    196Intersegment revenue
    
    
    5
    
    
    
    3Total revenue (Tax-equivalent)
    
    
    397
    
    
    
    380Provision for credit losses
    
    
    5
    
    
    
    1Noninterest expense
    
    
    246
    
    
    
    247Income taxes (Tax-equivalent)
    
    
    54
    
    
    
    48Segment earnings
    
    $
    92
    
    
    
    84Performance and other dataEconomic profit
    
    $
    70
    
    
    
    63Risk adjusted return on capital (RAROC)
    
    
    50.80
    %
    
    
    54.31Economic capital, average
    
    $
    705
    
    
    
    592Cash overhead efficiency ratio (Tax-equivalent)
    
    
    62.08
    %
    
    
    65.12Lending commitments
    
    $
    7,007
    
    
    
    6,686Average loans, net
    
    
    22,413
    
    
    
    20,394Average core deposits
    
    $
    17,397
    
    
    
    17,267FTE employees
    
    
    4,650
    
    
    
    4,589
 Wealth Management
 
    
    Strong fiduciary and asset management fees as a pricing initiative implemented in
the third quarter of 2007 and new sales offset declines in equity valuations.
Insurance commissions declined largely due to a soft market for insurance premiums and
nonstrategic insurance account dispositions.
    
    Relatively flat net interest income as solid loan growth offset deposit spread
compression.
    
    A slight decline in expense driven by efficiency initiatives, which offset the
impact of private banking and Western expansion investment.
 14




---



##### 




    
    5 percent growth in assets under management to $79.8 billion as asset gathering
overcame market depreciation.
 Corporate and Investment Bank  Performance Summary
 Three Months EndedMarch 31,(Dollars in millions)
    
    2008
    
    
    2007Income statement dataNet interest income (Tax-equivalent)
    
    $
    1,032
    
    
    
    716Fee and other income
    
    
    (159
    )
    
    
    1,109Intersegment revenue
    
    
    (50
    )
    
    
    (43
    )Total revenue (Tax-equivalent)
    
    
    823
    
    
    
    1,782Provision for credit losses
    
    
    197
    
    
    
    6Noninterest expense
    
    
    747
    
    
    
    911Income taxes
(benefits) (Tax-equivalent)
    
    
    (44
    )
    
    
    315Segment earnings (loss)
    
    $
    (77
    )
    
    
    550Performance and other dataEconomic
profit (loss)
    
    $
    (411
    )
    
    
    286Risk adjusted return on capital (RAROC)
    
    
    (1.49
    )%
    
    
    24.91Economic capital, average
    
    $
    13,242
    
    
    
    8,329Cash overhead efficiency ratio (Tax-equivalent)
    
    
    90.76
    %
    
    
    51.10Lending commitments
    
    $
    113,521
    
    
    
    110,214Average loans, net
    
    
    101,024
    
    
    
    73,385Average core deposits
    
    $
    33,623
    
    
    
    34,227FTE employees
    
    
    6,358
    
    
    
    6,650
 Corporate and Investment Bank
  
    
    $339 million in subprime residential asset-backed collateralized debt obligations and
other related exposures;
    
    $521 million in commercial mortgage structured products;
    
    $251 million in consumer mortgage structured products;
    
    $309 million in leveraged finance net of fees and macro credit hedges; and
    
    $144 million in non-subprime collateralized debt obligations and other structured
products.
  
    
    A 44 percent increase in net interest income, which reflected 38 percent growth in
average loans including the transfer into the loan portfolio at fair value of certain
loans originally slated for disposition, as well as loan growth in the corporate lending
and the global financial institutions businesses.
    
    Strong performance in high grade, global rate products and equities offset by lower
results in structured products and leveraged finance.
 15




---



##### 




    
    An 18 percent decline in noninterest expense primarily due to lower revenue-based
incentive compensation and reduced headcount in markets-related businesses.
    
    Provision of $197 million largely reflecting residential-related commercial real estate
losses, compared to $6 million in the first quarter of 2007.
 Capital Management  Performance Summary
 Three Months EndedMarch 31,(Dollars in millions)
    
    2008
    
    
    2007Income statement dataNet interest income (Tax-equivalent)
    
    $
    274
    
    
    
    259Fee and other income
    
    
    2,191
    
    
    
    1,477Intersegment revenue
    
    
    (10
    )
    
    
    (8
    )Total revenue (Tax-equivalent)
    
    
    2,455
    
    
    
    1,728Provision for credit losses
    
    
    
    
    
    
    Noninterest expense
    
    
    1,855
    
    
    
    1,237Income taxes (Tax-equivalent)
    
    
    219
    
    
    
    179Segment earnings
    
    $
    381
    
    
    
    312Performance and other dataEconomic profit
    
    $
    322
    
    
    
    275Risk adjusted return on capital (RAROC)
    
    
    71.51
    %
    
    
    94.78Economic capital, average
    
    $
    2,143
    
    
    
    1,334Cash overhead efficiency ratio (Tax-equivalent)
    
    
    75.54
    %
    
    
    71.59Lending commitments
    
    $
    1,348
    
    
    
    961Average loans, net
    
    
    2,562
    
    
    
    1,554Average core deposits
    
    $
    43,084
    
    
    
    31,683FTE employees
    
    
    29,838
    
    
    
    17,703
 Capital Management
 
    
    Solid growth in revenue despite declining equity markets:
 o
    
    $2.2 billion in revenue from our retail brokerage businesses
including transactional revenues of $822 million and asset-based and other income
of $1.3 billion. Retail brokerage fee income increased 57 percent driven by the
addition of A.G. Edwards, strength in managed account and other asset-based fees,
partially offset by lower brokerage transaction activity and equity syndicate
distribution fees.o
    
    $300 million in revenue from our asset management businesses, up $25
million, primarily driven by the ECM acquisition and higher securities lending
revenue, partially offset by the impact of declining equity markets.
 
    
    The impact of FDIC sweep deposit growth of $11.0 billion partially offset spread
compression in the declining interest rate environment.
    
    50 percent growth in noninterest expense largely due to the effect of A.G. Edwards, as
well as higher legal expense and revenue-based commissions.
 16




---



##### 



Total Assets Under Management (AUM)
 2008
    
    
    2007First Quarter
    
    
    Fourth Quarter
    
    
    First Quarter(In billions)
    
    Amount
    
    
    Mix
    
    
    Amount
    
    
    Mix
    
    
    Amount
    
    
    MixEquity
    
    $
    74
    
    
    
    28
    %
    
    $
    84
    
    
    
    30
    %
    
    $
    107
    
    
    
    34
    %Fixed income
    
    
    118
    
    
    
    46
    
    
    
    123
    
    
    
    45
    
    
    
    143
    
    
    
    45Money market
    
    
    67
    
    
    
    26
    
    
    
    68
    
    
    
    25
    
    
    
    65
    
    
    
    21Total assets under
management (a)
    
    $
    259
    
    
    
    100
    %
    
    $
    275
    
    
    
    100
    %
    
    $
    315
    
    
    
    100
    %Securities lending
    
    
    46
    
    
    
    
    
    
    
    52
    
    
    
    
    
    
    
    56
    
    
    
    Total assets under
management and
securities lending
    
    $
    305
    
    
    
    
    
    
    $
    327
    
    
    
    
    
    
    $
    371
    
    
    
    
 (a)
    
    Includes $39 billion in assets managed for Wealth Management, which are also reported
in that segment.
 Mutual Funds (AUM also included in the above)
 2008
    
    
    2007First Quarter
    
    
    Fourth Quarter
    
    
    First QuarterFund
    
    
    
    
    
    
    Fund
    
    
    
    
    
    
    Fund(In billions)
    
    Amount
    
    
    Mix
    
    
    Amount
    
    
    Mix
    
    
    Amount
    
    
    MixEquity
    
    $
    32
    
    
    
    30
    %
    
    $
    36
    
    
    
    32
    %
    
    $
    37
    
    
    
    34
    %Fixed income
    
    
    18
    
    
    
    17
    
    
    
    19
    
    
    
    17
    
    
    
    23
    
    
    
    21Money market
    
    
    57
    
    
    
    53
    
    
    
    58
    
    
    
    51
    
    
    
    50
    
    
    
    45Total mutual fund assets
    
    $
    107
    
    
    
    100
    %
    
    $
    113
    
    
    
    100
    %
    
    $
    110
    
    
    
    100
    %
  Parent  Performance Summary
 Three Months EndedMarch 31,(Dollars in millions)
    
    2008
    
    
    2007Income statement dataNet interest income (Tax-equivalent)
    
    $
    (137
    )
    
    
    (17
    )Fee and other income
    
    
    (456
    )
    
    
    107Intersegment revenue
    
    
    
    
    
    
    1Total revenue (Tax-equivalent)
    
    
    (593
    )
    
    
    91Provision for credit losses
    
    
    2,060
    
    
    
    23Noninterest expense
    
    
    302
    
    
    
    347Minority interest
    
    
    198
    
    
    
    136Income taxes
(benefits) (Tax-equivalent)
    
    
    (1,021
    )
    
    
    (333
    )Segment earnings (loss)
    
    $
    (2,132
    )
    
    
    (82
    )Performance and other dataEconomic
profit (loss)
    
    $
    (842
    )
    
    
    (61
    )Risk adjusted return on capital (RAROC)
    
    
    (167.55
    )%
    
    
    1.61Economic capital, average
    
    $
    1,888
    
    
    
    2,658Cash overhead efficiency ratio (Tax-equivalent)
    
    
    (34.17
    )%
    
    
    250.80Lending commitments
    
    $
    538
    
    
    
    503Average loans, net
    
    
    28,490
    
    
    
    31,699Average core deposits
    
    $
    2,729
    
    
    
    2,047FTE employees
    
    
    24,685
    
    
    
    24,705
 Parent
 
    
    A decline in net interest income, reflecting growth in wholesale funding as well as
securitization of higher yielding real estate-secured loans that were largely replaced by
lower yielding foreign commercial loans.
 17




---



##### 




    
    A $2.0 billion increase in the provision for credit losses reflecting increased credit risk
and loan growth.
    
    A $249 million decrease in fee and other income reflecting net securities losses of $143
million, including $409 million of impairment losses related to the market disruption,
compared with $47 million of net securities gains in 2007, and $314 million of valuation
losses related to our BOLI portfolio discussed above. This was partially offset by the $225
million Visa gain.
    
    A 13 percent decrease in noninterest expense, reflecting efficiencies, as well as increased
costs in the business segments offset in the Parent. In addition, noninterest expense includes
higher legal costs, which were flat year over year, including the reversal of legal reserves
established in late 2007 related to the Visa initial public offering.
 Executive Summary
     18




---



##### 



19




---



##### 



Balance Sheet Analysis
 Securities
 Securities Available For Sale
 March 31,
    
    
    December 31,(In billions)
    
    2008
    
    
    2007Market value
    
    $
    114.2
    
    
    
    115.0Net unrealized loss
    
    $
    (2.3
    )
    
    
    (1.3
    )Memoranda(Market value)Residual interests
    
    $
    0.5
    
    
    
    0.5Retained bondsInvestment grade (a)
    
    $
    12.9
    
    
    
    11.6
 (a)
    
    $ 12.6 billion had credit ratings of AA and above at March 31, 2008.
 Interest Rate Risk Management
   Loans  On-Balance Sheet
 2008
    
    
    2007First
    
    
    Fourth
    
    
    Third
    
    
    Second
    
    
    First(In millions)
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    QuarterCommercialCommercial, financial and agricultural
    
    $
    119,193
    
    
    
    112,509
    
    
    
    109,269
    
    
    
    102,397
    
    
    
    99,687Real estate - construction and other
    
    
    18,597
    
    
    
    18,543
    
    
    
    18,167
    
    
    
    17,449
    
    
    
    16,965Real estate - mortgage
    
    
    26,370
    
    
    
    23,846
    
    
    
    21,514
    
    
    
    20,448
    
    
    
    20,130Lease financing
    
    
    23,637
    
    
    
    23,913
    
    
    
    23,966
    
    
    
    24,083
    
    
    
    24,053Foreign
    
    
    33,616
    
    
    
    29,540
    
    
    
    26,471
    
    
    
    20,959
    
    
    
    16,240Total commercial
    
    
    221,413
    
    
    
    208,351
    
    
    
    199,387
    
    
    
    185,336
    
    
    
    177,075ConsumerReal estate secured
    
    
    230,197
    
    
    
    227,719
    
    
    
    225,355
    
    
    
    220,293
    
    
    
    220,682Student loans
    
    
    9,324
    
    
    
    8,149
    
    
    
    7,742
    
    
    
    6,757
    
    
    
    8,479Installment loans
    
    
    27,437
    
    
    
    25,635
    
    
    
    24,763
    
    
    
    25,017
    
    
    
    23,665Total consumer
    
    
    266,958
    
    
    
    261,503
    
    
    
    257,860
    
    
    
    252,067
    
    
    
    252,826Total loans
    
    
    488,371
    
    
    
    469,854
    
    
    
    457,247
    
    
    
    437,403
    
    
    
    429,901Unearned income
    
    
    (7,889
    )
    
    
    (7,900
    )
    
    
    (8,041
    )
    
    
    (8,283
    )
    
    
    (8,238
    )Loans, net (On-balance sheet)
    
    $
    480,482
    
    
    
    461,954
    
    
    
    449,206
    
    
    
    429,120
    
    
    
    421,663
 Loans  Managed Portfolio (Including on-balance sheet)
 2008
    
    
    2007First
    
    
    Fourth
    
    
    Third
    
    
    Second
    
    
    First(In millions)
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    QuarterCommercial
    
    $
    224,875
    
    
    
    217,896
    
    
    
    213,434
    
    
    
    197,079
    
    
    
    187,723Real estate secured
    
    
    254,685
    
    
    
    250,520
    
    
    
    242,526
    
    
    
    238,575
    
    
    
    236,995Student loans
    
    
    11,962
    
    
    
    11,012
    
    
    
    12,618
    
    
    
    11,760
    
    
    
    11,576Installment loans
    
    
    31,571
    
    
    
    30,487
    
    
    
    29,365
    
    
    
    28,273
    
    
    
    27,118Total managed portfolio
    
    $
    523,093
    
    
    
    509,915
    
    
    
    497,943
    
    
    
    475,687
    
    
    
    463,412
 20




---



##### 



Loans
   
    
    Commercial loans represented 45 percent and consumer loans 55 percent of the loan
portfolio.
    
    71 percent of the commercial loan portfolio is secured by collateral.
    
    99 percent of the consumer loan portfolio is either secured by collateral or
guaranteed.
  
    
    86 percent is secured by a first lien.
    
    84 percent has an original loan-to-value ratio of 80 percent or less.
    
    95 percent has an original loan-to-value ratio of 90 percent or less.
    
    14 percent of the home equity and prime equity portfolios have an original
loan-to-value ratio greater than 90 percent; of which 44 percent are in the first lien
position.
  21




---



##### 



Asset Quality
 2008
    
    
    2007First
    
    
    Fourth
    
    
    Third
    
    
    Second
    
    
    First(In millions)
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    QuarterNonperforming assetsNonaccrual loans
    
    $
    7,788
    
    
    
    4,995
    
    
    
    2,715
    
    
    
    1,945
    
    
    
    1,632Troubled debt restructurings (a)
    
    
    48
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Foreclosed properties
    
    
    530
    
    
    
    389
    
    
    
    334
    
    
    
    207
    
    
    
    155Total nonperforming assets
    
    $
    8,366
    
    
    
    5,384
    
    
    
    3,049
    
    
    
    2,152
    
    
    
    1,787as % of loans, net and foreclosed properties
    
    
    1.74
    %
    
    
    1.16
    
    
    
    0.68
    
    
    
    0.50
    
    
    
    0.42Nonperforming assets in loans held for sale
    
    $
    5
    
    
    
    62
    
    
    
    59
    
    
    
    42
    
    
    
    26Total nonperforming assets in loans
and in loans held for sale
    
    $
    8,371
    
    
    
    5,446
    
    
    
    3,108
    
    
    
    2,194
    
    
    
    1,813as % of loans, net, foreclosed properties and
loans held for sale
    
    
    1.70
    %
    
    
    1.14
    
    
    
    0.66
    
    
    
    0.49
    
    
    
    0.42Provision for credit losses
    
    $
    2,831
    
    
    
    1,497
    
    
    
    408
    
    
    
    179
    
    
    
    177Allowance for credit losses
    
    $
    6,767
    
    
    
    4,717
    
    
    
    3,691
    
    
    
    3,552
    
    
    
    3,533Allowance for loan lossesas % of loans, net
    
    
    1.37
    %
    
    
    0.98
    
    
    
    0.78
    
    
    
    0.79
    
    
    
    0.80as % of nonaccrual and restructured loans (b)
    
    
    84
    
    
    
    90
    
    
    
    129
    
    
    
    174
    
    
    
    207as % of nonperforming assets (b)
    
    
    78
    
    
    
    84
    
    
    
    115
    
    
    
    157
    
    
    
    189Allowance for credit lossesas % of loans, net
    
    
    1.41
    %
    
    
    1.02
    
    
    
    0.82
    
    
    
    0.83
    
    
    
    0.84Net charge-offs
    
    $
    765
    
    
    
    461
    
    
    
    206
    
    
    
    150
    
    
    
    155Commercial, as % of average commercial loans
    
    
    0.48
    %
    
    
    0.34
    
    
    
    0.08
    
    
    
    0.07
    
    
    
    0.07Consumer, as % of average consumer loans
    
    
    0.79
    
    
    
    0.46
    
    
    
    0.27
    
    
    
    0.19
    
    
    
    0.20Total, as % of average loans, net
    
    
    0.66
    %
    
    
    0.41
    
    
    
    0.19
    
    
    
    0.14
    
    
    
    0.15Past due accruing loans, 90 days and over
    
    $
    1,047
    
    
    
    708
    
    
    
    590
    
    
    
    562
    
    
    
    555Commercial, as a % of loans, net
    
    
    0.05
    %
    
    
    0.05
    
    
    
    0.04
    
    
    
    0.03
    
    
    
    0.03Consumer, as a % of loans, net
    
    
    0.35
    %
    
    
    0.23
    
    
    
    0.20
    
    
    
    0.20
    
    
    
    0.20
 (a)
    
    Troubled debt restructurings
were not significant prior to the
first quarter of 2008.(b)
    
    These ratios do not include
nonperforming assets included in
loans held for sale.
 Nonperforming Assets
 22




---



##### 



Nonperforming Assets
 2008
    
    
    2007First
    
    
    Fourth
    
    
    Third
    
    
    Second
    
    
    First(In millions)
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    QuarterNonaccrual LoansCommercial:Commercial, financial and agricultural
    
    $
    908
    
    
    
    602
    
    
    
    354
    
    
    
    318
    
    
    
    303Commercial real estate  construction
and mortgage
    
    
    1,750
    
    
    
    1,059
    
    
    
    289
    
    
    
    161
    
    
    
    117Total commercial
    
    
    2,658
    
    
    
    1,661
    
    
    
    643
    
    
    
    479
    
    
    
    420Consumer:Real estate secured:First lien
    
    
    5,015
    
    
    
    3,234
    
    
    
    1,986
    
    
    
    1,380
    
    
    
    1,124Second lien
    
    
    75
    
    
    
    58
    
    
    
    41
    
    
    
    44
    
    
    
    37Installment and other loans (a)
    
    
    40
    
    
    
    42
    
    
    
    45
    
    
    
    42
    
    
    
    51Total consumer
    
    
    5,130
    
    
    
    3,334
    
    
    
    2,072
    
    
    
    1,466
    
    
    
    1,212Total nonaccrual loans
    
    
    7,788
    
    
    
    4,995
    
    
    
    2,715
    
    
    
    1,945
    
    
    
    1,632Troubled debt restructurings (b)
    
    
    48
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Foreclosed properties
    
    
    530
    
    
    
    389
    
    
    
    334
    
    
    
    207
    
    
    
    155Total nonperforming assets
    
    $
    8,366
    
    
    
    5,384
    
    
    
    3,049
    
    
    
    2,152
    
    
    
    1,787As % of loans, net, and foreclosed properties (c)
    
    
    1.74
    %
    
    
    1.16
    
    
    
    0.68
    
    
    
    0.50
    
    
    
    0.42Nonperforming assets included in loans
held for saleCommercial
    
    $
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1Consumer
    
    
    5
    
    
    
    62
    
    
    
    50
    
    
    
    37
    
    
    
    23Total nonaccrual loans
    
    
    5
    
    
    
    62
    
    
    
    50
    
    
    
    37
    
    
    
    24Foreclosed properties
    
    
    
    
    
    
    
    
    
    
    9
    
    
    
    5
    
    
    
    2Total nonperforming assets included in
loans held for sale
    
    
    5
    
    
    
    62
    
    
    
    59
    
    
    
    42
    
    
    
    26Nonperforming assets included in loans
and in loans held for sale
    
    $
    8,371
    
    
    
    5,446
    
    
    
    3,108
    
    
    
    2,194
    
    
    
    1,813As % of loans, net, foreclosed properties and
loans held for sale (d)
    
    
    1.70
    %
    
    
    1.14
    
    
    
    0.66
    
    
    
    0.49
    
    
    
    0.42Past due loans, 90 days and over,
and nonaccrual loansAccruing loans past due 90 days and over
    
    $
    1,047
    
    
    
    708
    
    
    
    590
    
    
    
    562
    
    
    
    555Nonaccrual loans
    
    
    7,788
    
    
    
    4,995
    
    
    
    2,715
    
    
    
    1,945
    
    
    
    1,632Total past due loans 90 days and over,
and nonaccrual loans
    
    $
    8,835
    
    
    
    5,703
    
    
    
    3,305
    
    
    
    2,507
    
    
    
    2,187Commercial, as a % of loans, net
    
    
    1.31
    %
    
    
    0.89
    
    
    
    0.38
    
    
    
    0.31
    
    
    
    0.28Consumer, as a % of loans, net
    
    
    2.26
    %
    
    
    1.49
    
    
    
    1.00
    
    
    
    0.78
    
    
    
    0.68
 (a)
    
    Principally auto loans;
nonaccrual status does not apply to student
loans.(b)
    
    Troubled debt
restructurings were not significant prior to the
first quarter of 2008.(c)
    
    These
ratios do not include nonperforming assets
included in loans held for sale.(d)
    
    These ratios reflect nonperforming assets
included in loans held for sale.
 Past Due Loans
 23




---



##### 



Charge-offs
 2008
    
    
    2007First
    
    
    Fourth
    
    
    Third
    
    
    Second
    
    
    First(In millions)
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    QuarterLoan losses:Commercial, financial and agricultural
    
    $
    (171
    )
    
    
    (67
    )
    
    
    (41
    )
    
    
    (39
    )
    
    
    (34
    )Commercial
real estate - construction and mortgage
    
    
    (81
    )
    
    
    (117
    )
    
    
    (5
    )
    
    
    (4
    )
    
    
    (6
    )Total commercial
    
    
    (252
    )
    
    
    (184
    )
    
    
    (46
    )
    
    
    (43
    )
    
    
    (40
    )Real estate secured
    
    
    (351
    )
    
    
    (156
    )
    
    
    (59
    )
    
    
    (40
    )
    
    
    (33
    )Student loans
    
    
    (3
    )
    
    
    (4
    )
    
    
    (5
    )
    
    
    (2
    )
    
    
    (3
    )Installment and other loans (a)
    
    
    (242
    )
    
    
    (225
    )
    
    
    (168
    )
    
    
    (138
    )
    
    
    (142
    )Total consumer
    
    
    (596
    )
    
    
    (385
    )
    
    
    (232
    )
    
    
    (180
    )
    
    
    (178
    )Total loan losses
    
    
    (848
    )
    
    
    (569
    )
    
    
    (278
    )
    
    
    (223
    )
    
    
    (218
    )Loan recoveries:Commercial, financial and agricultural
    
    
    14
    
    
    
    22
    
    
    
    9
    
    
    
    15
    
    
    
    9Commercial
real estate - construction and mortgage
    
    
    1
    
    
    
    
    
    
    
    3
    
    
    
    
    
    
    
    3Total commercial
    
    
    15
    
    
    
    22
    
    
    
    12
    
    
    
    15
    
    
    
    12Real estate secured
    
    
    10
    
    
    
    9
    
    
    
    12
    
    
    
    11
    
    
    
    6Student loans
    
    
    1
    
    
    
    2
    
    
    
    3
    
    
    
    
    
    
    
    1Installment and other loans (a)
    
    
    57
    
    
    
    75
    
    
    
    45
    
    
    
    47
    
    
    
    44Total consumer
    
    
    68
    
    
    
    86
    
    
    
    60
    
    
    
    58
    
    
    
    51Total loan recoveries
    
    
    83
    
    
    
    108
    
    
    
    72
    
    
    
    73
    
    
    
    63Net charge-offs
    
    $
    (765
    )
    
    
    (461
    )
    
    
    (206
    )
    
    
    (150
    )
    
    
    (155
    )Net charge-offs as a % of average loans, net(b)Commercial, financial and agricultural
    
    
    0.41
    %
    
    
    0.12
    
    
    
    0.10
    
    
    
    0.07
    
    
    
    0.08Commercial
real estate - construction and mortgage
    
    
    0.73
    
    
    
    1.12
    
    
    
    0.02
    
    
    
    0.04
    
    
    
    0.04Total commercial
    
    
    0.48
    
    
    
    0.34
    
    
    
    0.08
    
    
    
    0.07
    
    
    
    0.07Real estate secured
    
    
    0.59
    
    
    
    0.26
    
    
    
    0.08
    
    
    
    0.05
    
    
    
    0.05Student loans
    
    
    0.08
    
    
    
    0.10
    
    
    
    0.14
    
    
    
    0.07
    
    
    
    0.10Installment and other loans (a)
    
    
    2.76
    
    
    
    2.35
    
    
    
    1.99
    
    
    
    1.47
    
    
    
    1.67Total consumer
    
    
    0.79
    
    
    
    0.46
    
    
    
    0.27
    
    
    
    0.19
    
    
    
    0.20Total, as % of average loans, net
    
    
    0.66
    %
    
    
    0.41
    
    
    
    0.19
    
    
    
    0.14
    
    
    
    0.15Consumer real estate secured net charge-offs:First lien
    
    $
    (291
    )
    
    
    (122
    )
    
    
    (32
    )
    
    
    (17
    )
    
    
    (15
    )Second lien
    
    
    (50
    )
    
    
    (25
    )
    
    
    (15
    )
    
    
    (12
    )
    
    
    (12
    )Total consumer real estate secured net charge-offs
    
    $
    (341
    )
    
    
    (147
    )
    
    
    (47
    )
    
    
    (29
    )
    
    
    (27
    )
 (a)
    
    Principally auto loans.(b)
    
    Annualized.
 Net Charge-offs
 24




---



##### 



Allowance for Credit Losses
 2008
    
    
    2007First
    
    
    Fourth
    
    
    Third
    
    
    Second
    
    
    First(In millions)
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    QuarterAllowance for credit losses(a)Allowance for loan losses, beginning of period
    
    $
    4,507
    
    
    
    3,505
    
    
    
    3,390
    
    
    
    3,378
    
    
    
    3,360Net charge-offs
    
    
    (765
    )
    
    
    (461
    )
    
    
    (206
    )
    
    
    (150
    )
    
    
    (155
    )Allowance relating to loans acquired, transferred
to loans held for sale or sold
    
    
    (16
    )
    
    
    (10
    )
    
    
    (63
    )
    
    
    (10
    )
    
    
    (3
    )Provision for credit losses related to loans
transferred to loans held for sale or sold (b)
    
    
    7
    
    
    
    6
    
    
    
    3
    
    
    
    4
    
    
    
    1Provision for credit losses
    
    
    2,834
    
    
    
    1,467
    
    
    
    381
    
    
    
    168
    
    
    
    175Allowance for loan losses, end of period
    
    
    6,567
    
    
    
    4,507
    
    
    
    3,505
    
    
    
    3,390
    
    
    
    3,378Reserve for unfunded lending commitments,
beginning of period
    
    
    210
    
    
    
    186
    
    
    
    162
    
    
    
    155
    
    
    
    154Provision for credit losses
    
    
    (10
    )
    
    
    24
    
    
    
    24
    
    
    
    7
    
    
    
    1Reserve for unfunded lending commitments,
end of period
    
    
    200
    
    
    
    210
    
    
    
    186
    
    
    
    162
    
    
    
    155Allowance for credit losses
    
    $
    6,767
    
    
    
    4,717
    
    
    
    3,691
    
    
    
    3,552
    
    
    
    3,533Allowance for loan lossesas % of loans, net
    
    
    1.37
    %
    
    
    0.98
    
    
    
    0.78
    
    
    
    0.79
    
    
    
    0.80as % of nonaccrual and restructured loans (c)
    
    
    84
    
    
    
    90
    
    
    
    129
    
    
    
    174
    
    
    
    207as % of nonperforming assets (c)
    
    
    78
    
    
    
    84
    
    
    
    115
    
    
    
    157
    
    
    
    189Allowance for credit lossesas % of loans, net
    
    
    1.41
    %
    
    
    1.02
    
    
    
    0.82
    
    
    
    0.83
    
    
    
    0.84
 (a)
    
    The allowance for credit losses is the sum of the
allowance for loan losses and the reserve for unfunded lending
commitments.(b)
    
    The provision related to loans
transferred or sold includes recovery of lower of cost or
market losses.(c)
    
    These ratios do not include nonperforming assets included in loans held for sale.
 Provision, Allowance and Reserves
  
    
    $1.6 billion due to higher expected loss factors for Pick-a-Payment, home equity and
traditional mortgage, and auto portfolios on significant market weakness and changing
consumer behaviors. Of this amount, $1.1 billion related to the Pick-a-Payment portfolio.
    
    $137 million on the commercial portfolio on higher loss frequency and severity
expectations.
    
    $107 million on the commercial real estate portfolio, including $98 million on impaired
loans.
    
    $165 million increase in unallocated reserves due to increased credit risk uncertainty
stemming from economic and other market environmental factors.
  25




---



##### 



Table 11: Allowance for Credit Losses Corporate Results of Operations
   Loans Held for Sale
   Goodwill
   26




---



##### 



Liquidity and Capital Adequacy
 Core Deposits
  Purchased Funds
  Long-term Debt
  27




---



##### 



Credit Lines
 Stockholders Equity
 Dividend and Share Activity
 Three Months EndedMarch 31,(In millions, except per share data)
    
    2008
    
    
    2007Dividends on common shares
    
    $
    1,274
    
    
    
    1,071Dividends per common share
    
    $
    0.64
    
    
    
    0.56Common shares repurchased
    
    
    1
    
    
    
    5Average diluted common
shares outstanding
    
    
    1,977
    
    
    
    1,925
   28




---



##### 



Subsidiary Dividends
 Regulatory Capital
 Off-Balance Sheet Transactions  Summary of Off-Balance Sheet Exposures
 March 31, 2008
    
    
    December 31, 2007Carrying
    
    
    
    
    
    
    Carrying(In millions)
    
    Amount
    
    
    Exposure
    
    
    Amount
    
    
    ExposureGuaranteesSecurities and other lending indemnifications
    
    $
    
    
    
    
    53,132
    
    
    
    
    
    
    
    59,238Standby letters of credit
    
    
    114
    
    
    
    28,958
    
    
    
    124
    
    
    
    29,295Liquidity agreements
    
    
    159
    
    
    
    34,775
    
    
    
    14
    
    
    
    36,926Loans sold with recourse
    
    
    33
    
    
    
    6,399
    
    
    
    44
    
    
    
    6,710Residual value guarantees
    
    
    
    
    
    
    936
    
    
    
    
    
    
    
    1,123Other written put options
    
    
    1,964
    
    
    
    17,013
    
    
    
    1,221
    
    
    
    15,273Total guarantees
    
    $
    2,270
    
    
    
    141,213
    
    
    
    1,403
    
    
    
    148,565
 Summary of Off-Balance Sheet Exposures
 29




---



##### 



Risk Governance and Administration
 Market Risk Management
  Interest Rate Risk Management
    30




---



##### 



31




---



##### 



Earnings
Sensitivity Policy Period Sensitivity Measurement
  Policy Period  Sensitivity Measurement
 Actual
    
    
    ImpliedFed Funds
    
    
    Fed Funds
    
    
    PercentRate at
    
    
    Rate at
    
    
    EarningsMarch 31, 2008
    
    
    March 2009
    
    
    SensitivityMarket Forward Rate Scenarios(a)
    
    
    2.25
    %
    
    
    2.11
    
    
    
    High Rate Composite
    
    
    
    
    
    
    4.11
    
    
    
    (3.90
    )Low Rate
    
    
    
    
    
    
    1.11
    
    
    
    1.70
 (a)
    
    Assumes base federal funds rate mirrors market expectations.
   Accounting and Regulatory Matters
  Business Combinations and Noncontrolling Interests Business Combinations Noncontrolling Interests in Consolidated
Financial Statements an amendment of ARB 51.
  32




---



##### 



Derivative Disclosure Disclosures about Derivative
Instruments and Hedging Activitiesan amendment of FASB Statement No. 133
 Transfers of Financial Assets and Consolidation Accounting for Transfers and Servicing of Financial Assets and
Extinguishment of Liabilities, Consolidation of Variable
Interest Entities
   33




---



##### 



Legislative and Regulatory Matters
  34




---



##### 



Table 1  EXPLANATION OF OUR USE OF NON-GAAP FINANCIAL MEASURES
      Three Months EndedMarch 31,(In millions, except per share data)
    
    2008
    
    
    2007Net interest income (GAAP)
    
    $
    4,752
    
    
    
    4,500Tax-equivalent adjustment
    
    
    53
    
    
    
    37Net interest income (Tax-equivalent)
    
    $
    4,805
    
    
    
    4,537DIVIDEND PAYOUT RATIOS ON COMMON SHARESDiluted earnings per common share (GAAP)(a)
    
    $
    (0.36
    )
    
    
    1.20Other intangible amortization
    
    
    0.04
    
    
    
    0.04Merger-related and restructuring expenses
    
    
    0.06
    
    
    
    Earnings per share (b)
    
    $
    (0.26
    )
    
    
    1.24Dividends paid per common share
    
    $
    0.64
    
    
    
    0.56Dividend payout ratios (GAAP)(c)
    
    
    (177.78
    )%
    
    
    46.67Dividend payout ratios (b) (c)
    
    
    (246.15
    )%
    
    
    45.16
    35




---



##### 



Table 2  SELECTED STATISTICAL DATA
 2008
    
    
    2007First
    
    
    Fourth
    
    
    Third
    
    
    Second
    
    
    First(Dollars in millions, except per share data)
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    QuarterPROFITABILITYReturn on average common stockholders equity
    
    
    (3.81
    )%
    
    
    0.28
    
    
    
    9.19
    
    
    
    13.54
    
    
    
    13.47Return on average total stockholders equity
    
    
    (3.39
    )
    
    
    0.28
    
    
    
    9.19
    
    
    
    13.54
    
    
    
    13.47Net interest margin (a)
    
    
    2.92
    
    
    
    2.88
    
    
    
    2.92
    
    
    
    2.96
    
    
    
    3.06Fee and other income as % of total revenue
    
    
    36.62
    
    
    
    36.99
    
    
    
    39.02
    
    
    
    48.58
    
    
    
    45.15Effective income tax rate
    
    
    26.02
    %
    
    
    122.05
    
    
    
    27.33
    
    
    
    32.78
    
    
    
    30.22ASSET QUALITYAllowance for loan losses as % of loans, net
    
    
    1.37
    %
    
    
    0.98
    
    
    
    0.78
    
    
    
    0.79
    
    
    
    0.80Allowance for loan losses as % of nonperforming assets (b)
    
    
    78
    
    
    
    84
    
    
    
    115
    
    
    
    157
    
    
    
    189Allowance for credit losses as % of loans, net
    
    
    1.41
    
    
    
    1.02
    
    
    
    0.82
    
    
    
    0.83
    
    
    
    0.84Net charge-offs as % of average loans, net
    
    
    0.66
    
    
    
    0.41
    
    
    
    0.19
    
    
    
    0.14
    
    
    
    0.15Nonperforming assets as % of loans, net,
foreclosed properties and loans held for sale
    
    
    1.70
    %
    
    
    1.14
    
    
    
    0.66
    
    
    
    0.49
    
    
    
    0.42CAPITAL ADEQUACYTier 1 capital ratio
    
    
    7.42
    %
    
    
    7.35
    
    
    
    7.10
    
    
    
    7.47
    
    
    
    7.35Total capital ratio
    
    
    12.05
    
    
    
    11.82
    
    
    
    10.84
    
    
    
    11.46
    
    
    
    11.41Leverage
    
    
    6.18
    
    
    
    6.09
    
    
    
    6.10
    
    
    
    6.23
    
    
    
    6.08Tangible capital ratio
    
    
    4.31
    
    
    
    4.29
    
    
    
    4.19
    
    
    
    4.30
    
    
    
    4.44Tangible capital ratio (c)
    
    
    4.59
    %
    
    
    4.50
    
    
    
    4.56
    
    
    
    4.76
    
    
    
    4.71OTHER DATAFTE employees
    
    
    120,378
    
    
    
    121,890
    
    
    
    109,724
    
    
    
    110,493
    
    
    
    110,369Total financial centers/brokerage offices
    
    
    4,850
    
    
    
    4,894
    
    
    
    4,167
    
    
    
    4,135
    
    
    
    4,167ATMs
    
    
    5,308
    
    
    
    5,139
    
    
    
    5,123
    
    
    
    5,099
    
    
    
    5,146Actual common shares (In millions) (d)
    
    
    1,992
    
    
    
    1,980
    
    
    
    1,901
    
    
    
    1,903
    
    
    
    1,913Common stock price
    
    $
    27.00
    
    
    
    38.03
    
    
    
    50.15
    
    
    
    51.25
    
    
    
    55.05Market capitalization (d)
    
    $
    53,782
    
    
    
    75,302
    
    
    
    95,326
    
    
    
    97,530
    
    
    
    105,330
     36




---



##### 



Table 3  SUMMARIES OF INCOME, PER COMMON SHARE AND BALANCE SHEET DATA
 2008
    
    
    2007First
    
    
    Fourth
    
    
    Third
    
    
    Second
    
    
    First(In millions, except per share data)
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    QuarterSUMMARIES OF INCOMEInterest income
    
    $
    10,179
    
    
    
    10,910
    
    
    
    10,831
    
    
    
    10,350
    
    
    
    10,140Tax-equivalent adjustment
    
    
    53
    
    
    
    44
    
    
    
    33
    
    
    
    38
    
    
    
    37Interest income (a)
    
    
    10,232
    
    
    
    10,954
    
    
    
    10,864
    
    
    
    10,388
    
    
    
    10,177Interest expense
    
    
    5,427
    
    
    
    6,280
    
    
    
    6,280
    
    
    
    5,901
    
    
    
    5,640Net interest income (a)
    
    
    4,805
    
    
    
    4,674
    
    
    
    4,584
    
    
    
    4,487
    
    
    
    4,537Provision for credit losses
    
    
    2,831
    
    
    
    1,497
    
    
    
    408
    
    
    
    179
    
    
    
    177Net interest income after provision for credit losses (a)
    
    
    1,974
    
    
    
    3,177
    
    
    
    4,176
    
    
    
    4,308
    
    
    
    4,360Securities gains (losses)
    
    
    (205
    )
    
    
    (320
    )
    
    
    (34
    )
    
    
    23
    
    
    
    53Fee and other income
    
    
    2,982
    
    
    
    3,064
    
    
    
    2,967
    
    
    
    4,217
    
    
    
    3,681Merger-related and restructuring expenses
    
    
    241
    
    
    
    187
    
    
    
    36
    
    
    
    32
    
    
    
    10Other noninterest expense
    
    
    5,200
    
    
    
    5,599
    
    
    
    4,489
    
    
    
    4,858
    
    
    
    4,611Minority interest in income of consolidated subsidiaries
    
    
    155
    
    
    
    107
    
    
    
    189
    
    
    
    139
    
    
    
    136Income (loss) from continuing operations beforeincome taxes (benefits) (a)
    
    
    (845
    )
    
    
    28
    
    
    
    2,395
    
    
    
    3,519
    
    
    
    3,337Income taxes (benefits)
    
    
    (234
    )
    
    
    (209
    )
    
    
    656
    
    
    
    1,140
    
    
    
    998Tax-equivalent adjustment
    
    
    53
    
    
    
    44
    
    
    
    33
    
    
    
    38
    
    
    
    37Income (loss) from continuing operations
    
    
    (664
    )
    
    
    193
    
    
    
    1,706
    
    
    
    2,341
    
    
    
    2,302Discontinued operations, net of income taxes
    
    
    -
    
    
    
    (142
    )
    
    
    (88
    )
    
    
    -
    
    
    
    -Net income (loss)
    
    
    (664
    )
    
    
    51
    
    
    
    1,618
    
    
    
    2,341
    
    
    
    2,302Dividends on preferred stock
    
    
    43
    
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    -Net income (loss) available to common stockholders
    
    $
    (707
    )
    
    
    51
    
    
    
    1,618
    
    
    
    2,341
    
    
    
    2,302PER COMMON SHARE DATABasic earningsIncome (loss) from continuing operations
    
    $
    (0.36
    )
    
    
    0.03
    
    
    
    0.86
    
    
    
    1.24
    
    
    
    1.22Net income (loss) available to common stockholders
    
    
    (0.36
    )
    
    
    0.03
    
    
    
    0.86
    
    
    
    1.24
    
    
    
    1.22Diluted earnings (b)Income (loss) from continuing operations
    
    
    (0.36
    )
    
    
    0.03
    
    
    
    0.85
    
    
    
    1.22
    
    
    
    1.20Net income (loss) available to common stockholders
    
    
    (0.36
    )
    
    
    0.03
    
    
    
    0.85
    
    
    
    1.22
    
    
    
    1.20Cash dividends
    
    $
    0.64
    
    
    
    0.64
    
    
    
    0.64
    
    
    
    0.56
    
    
    
    0.56Average common shares - Basic
    
    
    1,963
    
    
    
    1,959
    
    
    
    1,885
    
    
    
    1,891
    
    
    
    1,894Average common shares - Diluted
    
    
    1,977
    
    
    
    1,983
    
    
    
    1,910
    
    
    
    1,919
    
    
    
    1,925Average common stockholders equityQuarter-to-date
    
    $
    74,697
    
    
    
    73,599
    
    
    
    69,857
    
    
    
    69,317
    
    
    
    69,320Year-to-date
    
    
    74,697
    
    
    
    70,533
    
    
    
    69,500
    
    
    
    69,318
    
    
    
    69,320Book value per common share (c)
    
    
    36.24
    
    
    
    37.66
    
    
    
    36.90
    
    
    
    36.40
    
    
    
    36.47Common stock priceHigh
    
    
    38.76
    
    
    
    51.80
    
    
    
    52.64
    
    
    
    56.81
    
    
    
    58.77Low
    
    
    25.60
    
    
    
    38.03
    
    
    
    44.94
    
    
    
    51.25
    
    
    
    53.88Period-end
    
    $
    27.00
    
    
    
    38.03
    
    
    
    50.15
    
    
    
    51.25
    
    
    
    55.05To earnings ratio (d)
    
    
    15.52
    X
    
    
    11.52
    
    
    
    11.22
    
    
    
    10.70
    
    
    
    11.61To book value
    
    
    75
    %
    
    
    101
    
    
    
    136
    
    
    
    141
    
    
    
    151BALANCE SHEET DATAAssets
    
    $
    808,575
    
    
    
    782,896
    
    
    
    754,168
    
    
    
    715,428
    
    
    
    702,669Long-term debt
    
    $
    175,653
    
    
    
    161,007
    
    
    
    158,584
    
    
    
    142,047
    
    
    
    142,334
     37




---



##### 



Table 4  MERGER-RELATED AND RESTRUCTURING EXPENSES
 ThreeMonthsEndedMarch 31,(In millions)
    
    2008Wachovia/A.G. Edwards
    
    $
    206Wachovia/Golden West
    
    
    35Total merger-related and restructuring expenses
    
    $
    241
 38




---



##### 



Table 5  BUSINESS SEGMENTS (a)
 2008
    
    
    2007First
    
    
    Fourth
    
    
    Third
    
    
    Second
    
    
    First(Dollars in millions)
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    QuarterGENERAL BANK COMBINED (b)Net interest income (c)
    
    $
    3,455
    
    
    
    3,402
    
    
    
    3,464
    
    
    
    3,371
    
    
    
    3,398Fee and other income
    
    
    990
    
    
    
    929
    
    
    
    935
    
    
    
    936
    
    
    
    845Intersegment revenue
    
    
    55
    
    
    
    58
    
    
    
    58
    
    
    
    56
    
    
    
    47Total revenue (c)
    
    
    4,500
    
    
    
    4,389
    
    
    
    4,457
    
    
    
    4,363
    
    
    
    4,290Provision for credit losses
    
    
    569
    
    
    
    320
    
    
    
    207
    
    
    
    154
    
    
    
    147Noninterest expense
    
    
    2,050
    
    
    
    2,041
    
    
    
    1,897
    
    
    
    1,926
    
    
    
    1,869Income taxes
    
    
    675
    
    
    
    730
    
    
    
    848
    
    
    
    823
    
    
    
    819Tax-equivalent adjustment
    
    
    11
    
    
    
    11
    
    
    
    11
    
    
    
    10
    
    
    
    11Segment earnings
    
    $
    1,195
    
    
    
    1,287
    
    
    
    1,494
    
    
    
    1,450
    
    
    
    1,444Economic profit
    
    $
    997
    
    
    
    1,041
    
    
    
    1,188
    
    
    
    1,122
    
    
    
    1,123Risk adjusted return on capital
    
    
    42.58
    %
    
    
    47.92
    
    
    
    54.29
    
    
    
    52.57
    
    
    
    53.73Economic capital, average
    
    $
    12,695
    
    
    
    11,179
    
    
    
    10,894
    
    
    
    10,819
    
    
    
    10,662Cash overhead efficiency ratio (c)
    
    
    45.55
    %
    
    
    46.50
    
    
    
    42.57
    
    
    
    44.14
    
    
    
    43.56Lending commitments
    
    $
    132,165
    
    
    
    133,024
    
    
    
    132,778
    
    
    
    129,850
    
    
    
    124,253Average loans, net
    
    
    311,447
    
    
    
    303,269
    
    
    
    294,579
    
    
    
    291,493
    
    
    
    288,229Average core deposits
    
    $
    297,680
    
    
    
    296,568
    
    
    
    290,377
    
    
    
    290,591
    
    
    
    284,046FTE employees
    
    
    54,847
    
    
    
    55,579
    
    
    
    56,538
    
    
    
    57,595
    
    
    
    56,722COMMERCIALNet interest income (c)
    
    $
    942
    
    
    
    931
    
    
    
    901
    
    
    
    865
    
    
    
    836Fee and other income
    
    
    140
    
    
    
    117
    
    
    
    114
    
    
    
    110
    
    
    
    109Intersegment revenue
    
    
    43
    
    
    
    43
    
    
    
    44
    
    
    
    42
    
    
    
    36Total revenue (c)
    
    
    1,125
    
    
    
    1,091
    
    
    
    1,059
    
    
    
    1,017
    
    
    
    981Provision for credit losses
    
    
    174
    
    
    
    178
    
    
    
    121
    
    
    
    96
    
    
    
    97Noninterest expense
    
    
    410
    
    
    
    389
    
    
    
    346
    
    
    
    353
    
    
    
    359Income taxes
    
    
    186
    
    
    
    181
    
    
    
    205
    
    
    
    198
    
    
    
    180Tax-equivalent adjustment
    
    
    11
    
    
    
    11
    
    
    
    11
    
    
    
    10
    
    
    
    11Segment earnings
    
    $
    344
    
    
    
    332
    
    
    
    376
    
    
    
    360
    
    
    
    334Economic profit
    
    $
    212
    
    
    
    241
    
    
    
    255
    
    
    
    230
    
    
    
    213Risk adjusted return on capital
    
    
    28.02
    %
    
    
    33.00
    
    
    
    35.19
    
    
    
    33.42
    
    
    
    32.90Economic capital, average
    
    $
    5,015
    
    
    
    4,332
    
    
    
    4,195
    
    
    
    4,109
    
    
    
    3,944Cash overhead efficiency ratio (c)
    
    
    36.41
    %
    
    
    35.71
    
    
    
    32.63
    
    
    
    34.78
    
    
    
    36.55Average loans, net
    
    $
    84,840
    
    
    
    82,089
    
    
    
    80,137
    
    
    
    78,162
    
    
    
    75,915Average core deposits
    
    $
    47,713
    
    
    
    46,361
    
    
    
    42,752
    
    
    
    43,065
    
    
    
    43,522RETAIL AND SMALL BUSINESSNet interest income (c)
    
    $
    2,513
    
    
    
    2,471
    
    
    
    2,563
    
    
    
    2,506
    
    
    
    2,562Fee and other income
    
    
    850
    
    
    
    812
    
    
    
    821
    
    
    
    826
    
    
    
    736Intersegment revenue
    
    
    12
    
    
    
    15
    
    
    
    14
    
    
    
    14
    
    
    
    11Total revenue (c)
    
    
    3,375
    
    
    
    3,298
    
    
    
    3,398
    
    
    
    3,346
    
    
    
    3,309Provision for credit losses
    
    
    395
    
    
    
    142
    
    
    
    86
    
    
    
    58
    
    
    
    50Noninterest expense
    
    
    1,640
    
    
    
    1,652
    
    
    
    1,551
    
    
    
    1,573
    
    
    
    1,510Income taxes
    
    
    489
    
    
    
    549
    
    
    
    643
    
    
    
    625
    
    
    
    639Tax-equivalent adjustment
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    -Segment earnings
    
    $
    851
    
    
    
    955
    
    
    
    1,118
    
    
    
    1,090
    
    
    
    1,110Economic profit
    
    $
    785
    
    
    
    800
    
    
    
    933
    
    
    
    892
    
    
    
    910Risk adjusted return on capital
    
    
    52.08
    %
    
    
    57.36
    
    
    
    66.25
    
    
    
    64.31
    
    
    
    65.96Economic capital, average
    
    $
    7,680
    
    
    
    6,847
    
    
    
    6,699
    
    
    
    6,710
    
    
    
    6,718Cash overhead efficiency ratio (c)
    
    
    48.60
    %
    
    
    50.07
    
    
    
    45.67
    
    
    
    46.98
    
    
    
    45.65Average loans, net
    
    $
    226,607
    
    
    
    221,180
    
    
    
    214,442
    
    
    
    213,331
    
    
    
    212,314Average core deposits
    
    $
    249,967
    
    
    
    250,207
    
    
    
    247,625
    
    
    
    247,526
    
    
    
    240,524
    (Continued)
 39




---



##### 



Table 5  BUSINESS SEGMENTS
 2008
    
    
    2007First
    
    
    Fourth
    
    
    Third
    
    
    Second
    
    
    First(Dollars in millions)
    
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    QuarterWEALTH MANAGEMENTNet interest income (a)
    
    $
    181
    
    
    
    183
    
    
    
    185
    
    
    
    182
    
    
    
    181Fee and other income
    
    
    211
    
    
    
    214
    
    
    
    185
    
    
    
    202
    
    
    
    196Intersegment revenue
    
    
    5
    
    
    
    3
    
    
    
    4
    
    
    
    3
    
    
    
    3Total revenue (a)
    
    
    397
    
    
    
    400
    
    
    
    374
    
    
    
    387
    
    
    
    380Provision for credit losses
    
    
    5
    
    
    
    7
    
    
    
    6
    
    
    
    2
    
    
    
    1Noninterest expense
    
    
    246
    
    
    
    249
    
    
    
    240
    
    
    
    244
    
    
    
    247Income taxes
    
    
    54
    
    
    
    53
    
    
    
    47
    
    
    
    51
    
    
    
    48Tax-equivalent adjustment
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    -Segment earnings
    
    $
    92
    
    
    
    91
    
    
    
    81
    
    
    
    90
    
    
    
    84Economic profit
    
    $
    70
    
    
    
    73
    
    
    
    62
    
    
    
    70
    
    
    
    63Risk adjusted return on capital
    
    
    50.80
    %
    
    
    58.23
    
    
    
    50.85
    
    
    
    56.74
    
    
    
    54.31Economic capital, average
    
    $
    705
    
    
    
    616
    
    
    
    616
    
    
    
    613
    
    
    
    592Cash overhead efficiency ratio (a)
    
    
    62.08
    %
    
    
    62.27
    
    
    
    64.36
    
    
    
    62.74
    
    
    
    65.12Lending commitments
    
    $
    7,007
    
    
    
    7,011
    
    
    
    7,007
    
    
    
    6,892
    
    
    
    6,686Average loans, net
    
    
    22,413
    
    
    
    21,791
    
    
    
    21,564
    
    
    
    21,127
    
    
    
    20,394Average core deposits
    
    $
    17,397
    
    
    
    16,773
    
    
    
    16,935
    
    
    
    17,342
    
    
    
    17,267FTE employees
    
    
    4,650
    
    
    
    4,712
    
    
    
    4,547
    
    
    
    4,580
    
    
    
    4,589
 (a)
    
    Tax-equivalent.
 (Continued)
 40




---



##### 



Table 5  BUSINESS SEGMENTS
 2008
    
    
    2007First
    
    
    Fourth
    
    
    Third
    
    
    Second
    
    
    First(Dollars in millions)
    
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    QuarterCORPORATE AND INVESTMENT
BANK COMBINED (a)Net interest income (b)
    
    $
    1,032
    
    
    
    988
    
    
    
    838
    
    
    
    774
    
    
    
    716Fee and other income
    
    
    (159
    )
    
    
    (555
    )
    
    
    175
    
    
    
    1,522
    
    
    
    1,109Intersegment revenue
    
    
    (50
    )
    
    
    (50
    )
    
    
    (52
    )
    
    
    (50
    )
    
    
    (43
    )Total revenue (b)
    
    
    823
    
    
    
    383
    
    
    
    961
    
    
    
    2,246
    
    
    
    1,782Provision for credit losses
    
    
    197
    
    
    
    112
    
    
    
    1
    
    
    
    (2
    )
    
    
    6Noninterest expense
    
    
    747
    
    
    
    952
    
    
    
    626
    
    
    
    1,020
    
    
    
    911Income taxes (benefits)
    
    
    (65
    )
    
    
    (269
    )
    
    
    114
    
    
    
    438
    
    
    
    305Tax-equivalent adjustment
    
    
    21
    
    
    
    19
    
    
    
    9
    
    
    
    11
    
    
    
    10Segment earnings (loss)
    
    $
    (77
    )
    
    
    (431
    )
    
    
    211
    
    
    
    779
    
    
    
    550Economic profit (loss)
    
    $
    (411
    )
    
    
    (746
    )
    
    
    (114
    )
    
    
    490
    
    
    
    286Risk adjusted return on capital
    
    
    (1.49
    )%
    
    
    (15.18
    )
    
    
    6.36
    
    
    
    33.22
    
    
    
    24.91Economic capital, average
    
    $
    13,242
    
    
    
    11,293
    
    
    
    9,794
    
    
    
    8,852
    
    
    
    8,329Cash overhead efficiency ratio (b)
    
    
    90.76
    %
    
    
    247.83
    
    
    
    65.23
    
    
    
    45.43
    
    
    
    51.10Lending commitments
    
    $
    113,521
    
    
    
    118,127
    
    
    
    119,295
    
    
    
    114,971
    
    
    
    110,214Average loans, net
    
    
    101,024
    
    
    
    91,702
    
    
    
    83,002
    
    
    
    76,779
    
    
    
    73,385Average core deposits
    
    $
    33,623
    
    
    
    36,200
    
    
    
    37,177
    
    
    
    36,702
    
    
    
    34,227FTE employees
    
    
    6,358
    
    
    
    6,589
    
    
    
    6,719
    
    
    
    6,860
    
    
    
    6,650CORPORATE LENDINGNet interest income (b)
    
    $
    432
    
    
    
    418
    
    
    
    413
    
    
    
    406
    
    
    
    400Fee and other income
    
    
    154
    
    
    
    148
    
    
    
    135
    
    
    
    140
    
    
    
    125Intersegment revenue
    
    
    13
    
    
    
    18
    
    
    
    16
    
    
    
    19
    
    
    
    18Total revenue (b)
    
    
    599
    
    
    
    584
    
    
    
    564
    
    
    
    565
    
    
    
    543Provision for credit losses
    
    
    132
    
    
    
    103
    
    
    
    2
    
    
    
    (1
    )
    
    
    5Noninterest expense
    
    
    141
    
    
    
    137
    
    
    
    139
    
    
    
    148
    
    
    
    152Income taxes
    
    
    119
    
    
    
    126
    
    
    
    152
    
    
    
    152
    
    
    
    142Tax-equivalent adjustment
    
    
    -
    
    
    
    -
    
    
    
    1
    
    
    
    -
    
    
    
    -Segment earnings
    
    $
    207
    
    
    
    218
    
    
    
    270
    
    
    
    266
    
    
    
    244Economic profit
    
    $
    46
    
    
    
    65
    
    
    
    82
    
    
    
    98
    
    
    
    89Risk adjusted return on capital
    
    
    13.77
    %
    
    
    15.37
    
    
    
    17.15
    
    
    
    19.22
    
    
    
    18.81Economic capital, average
    
    $
    6,634
    
    
    
    5,929
    
    
    
    5,273
    
    
    
    4,784
    
    
    
    4,619Cash overhead efficiency ratio (b)
    
    
    23.55
    %
    
    
    23.46
    
    
    
    24.58
    
    
    
    26.19
    
    
    
    28.08Average loans, net
    
    $
    64,161
    
    
    
    62,473
    
    
    
    58,663
    
    
    
    56,186
    
    
    
    55,193Average core deposits
    
    $
    4,537
    
    
    
    4,606
    
    
    
    5,101
    
    
    
    5,067
    
    
    
    5,083
 (a)
    Corporate and Investment Bank Combined represents the consolidation of the Corporate and
Investment Banks Corporate Lending, Treasury and International Trade Finance, and Investment
Banking lines of business.(b)
    Tax-equivalent.
 (Continued)
 41




---



##### 



Table 5  BUSINESS SEGMENTS
 2008
    
    
    2007First
    
    
    Fourth
    
    
    Third
    
    
    Second
    
    
    First(Dollars in millions)
    
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    QuarterTREASURY AND INTERNATIONAL TRADE
FINANCENet interest income (b)
    
    $
    112
    
    
    
    110
    
    
    
    104
    
    
    
    100
    
    
    
    91Fee and other income
    
    
    219
    
    
    
    219
    
    
    
    220
    
    
    
    213
    
    
    
    209Intersegment revenue
    
    
    (47
    )
    
    
    (47
    )
    
    
    (46
    )
    
    
    (49
    )
    
    
    (45
    )Total revenue (b)
    
    
    284
    
    
    
    282
    
    
    
    278
    
    
    
    264
    
    
    
    255Provision for credit losses
    
    
    (2
    )
    
    
    -
    
    
    
    (1
    )
    
    
    -
    
    
    
    -Noninterest expense
    
    
    175
    
    
    
    174
    
    
    
    170
    
    
    
    172
    
    
    
    173Income taxes
    
    
    41
    
    
    
    39
    
    
    
    40
    
    
    
    33
    
    
    
    30Tax-equivalent adjustment
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    -Segment earnings
    
    $
    70
    
    
    
    69
    
    
    
    69
    
    
    
    59
    
    
    
    52Economic profit
    
    $
    56
    
    
    
    56
    
    
    
    58
    
    
    
    48
    
    
    
    41Risk adjusted return on capital
    
    
    70.22
    %
    
    
    74.10
    
    
    
    77.79
    
    
    
    68.14
    
    
    
    61.40Economic capital, average
    
    $
    383
    
    
    
    355
    
    
    
    342
    
    
    
    335
    
    
    
    334Cash overhead efficiency ratio (b)
    
    
    61.69
    %
    
    
    61.78
    
    
    
    60.99
    
    
    
    65.13
    
    
    
    67.79Average loans, net
    
    $
    13,461
    
    
    
    12,309
    
    
    
    10,813
    
    
    
    9,540
    
    
    
    8,269Average core deposits
    
    $
    19,623
    
    
    
    20,830
    
    
    
    21,222
    
    
    
    21,091
    
    
    
    19,908INVESTMENT BANKINGNet interest income (b)
    
    $
    488
    
    
    
    460
    
    
    
    321
    
    
    
    268
    
    
    
    225Fee and other income
    
    
    (532
    )
    
    
    (922
    )
    
    
    (180
    )
    
    
    1,169
    
    
    
    775Intersegment revenue
    
    
    (16
    )
    
    
    (21
    )
    
    
    (22
    )
    
    
    (20
    )
    
    
    (16
    )Total revenue (b)
    
    
    (60
    )
    
    
    (483
    )
    
    
    119
    
    
    
    1,417
    
    
    
    984Provision for credit losses
    
    
    67
    
    
    
    9
    
    
    
    -
    
    
    
    (1
    )
    
    
    1Noninterest expense
    
    
    431
    
    
    
    641
    
    
    
    317
    
    
    
    700
    
    
    
    586Income taxes (benefits)
    
    
    (225
    )
    
    
    (434
    )
    
    
    (78
    )
    
    
    253
    
    
    
    133Tax-equivalent adjustment
    
    
    21
    
    
    
    19
    
    
    
    8
    
    
    
    11
    
    
    
    10Segment earnings (loss)
    
    $
    (354
    )
    
    
    (718
    )
    
    
    (128
    )
    
    
    454
    
    
    
    254Economic profit (loss)
    
    $
    (513
    )
    
    
    (867
    )
    
    
    (254
    )
    
    
    344
    
    
    
    156Risk adjusted return on capital
    
    
    (22.17
    )%
    
    
    (57.68
    )
    
    
    (13.11
    )
    
    
    48.03
    
    
    
    29.66Economic capital, average
    
    $
    6,225
    
    
    
    5,009
    
    
    
    4,179
    
    
    
    3,733
    
    
    
    3,376Cash overhead efficiency ratio (b)
    
    
    (719.88
    )%
    
    
    (133.14
    )
    
    
    270.51
    
    
    
    49.44
    
    
    
    59.46Average loans, net
    
    $
    23,402
    
    
    
    16,920
    
    
    
    13,526
    
    
    
    11,053
    
    
    
    9,923Average core deposits
    
    $
    9,463
    
    
    
    10,764
    
    
    
    10,854
    
    
    
    10,544
    
    
    
    9,236
 (Continued)
 42




---



##### 



Table 5  BUSINESS SEGMENTS
 2008
    
    
    2007First
    
    
    Fourth
    
    
    Third
    
    
    Second
    
    
    First(Dollars in millions)
    
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    QuarterCAPITAL MANAGEMENT COMBINED (a)Net interest income (b)
    
    $
    274
    
    
    
    318
    
    
    
    268
    
    
    
    260
    
    
    
    259Fee and other income
    
    
    2,191
    
    
    
    2,211
    
    
    
    1,444
    
    
    
    1,536
    
    
    
    1,477Intersegment revenue
    
    
    (10
    )
    
    
    (11
    )
    
    
    (8
    )
    
    
    (11
    )
    
    
    (8
    )Total revenue (b)
    
    
    2,455
    
    
    
    2,518
    
    
    
    1,704
    
    
    
    1,785
    
    
    
    1,728Provision for credit losses
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    -Noninterest expense
    
    
    1,855
    
    
    
    1,938
    
    
    
    1,241
    
    
    
    1,294
    
    
    
    1,237Income taxes
    
    
    218
    
    
    
    211
    
    
    
    169
    
    
    
    179
    
    
    
    179Tax-equivalent adjustment
    
    
    1
    
    
    
    1
    
    
    
    -
    
    
    
    -
    
    
    
    -Segment earnings
    
    $
    381
    
    
    
    368
    
    
    
    294
    
    
    
    312
    
    
    
    312Economic profit
    
    $
    322
    
    
    
    309
    
    
    
    258
    
    
    
    275
    
    
    
    275Risk adjusted return on capital
    
    
    71.51
    %
    
    
    68.92
    
    
    
    88.96
    
    
    
    92.77
    
    
    
    94.78Economic capital, average
    
    $
    2,143
    
    
    
    2,120
    
    
    
    1,310
    
    
    
    1,348
    
    
    
    1,334Cash overhead efficiency ratio (b)
    
    
    75.54
    %
    
    
    76.96
    
    
    
    72.82
    
    
    
    72.47
    
    
    
    71.59Lending commitments
    
    $
    1,348
    
    
    
    1,281
    
    
    
    1,164
    
    
    
    1,169
    
    
    
    961Average loans, net
    
    
    2,562
    
    
    
    2,295
    
    
    
    2,142
    
    
    
    1,663
    
    
    
    1,554Average core deposits
    
    $
    43,084
    
    
    
    38,019
    
    
    
    31,489
    
    
    
    31,221
    
    
    
    31,683FTE employees
    
    
    29,838
    
    
    
    29,885
    
    
    
    17,908
    
    
    
    17,905
    
    
    
    17,703Assets under management
    
    $
    258,691
    
    
    
    274,697
    
    
    
    285,423
    
    
    
    281,462
    
    
    
    314,551ASSET MANAGEMENTNet interest income (b)
    
    $
    6
    
    
    
    7
    
    
    
    6
    
    
    
    5
    
    
    
    3Fee and other income
    
    
    295
    
    
    
    279
    
    
    
    244
    
    
    
    312
    
    
    
    272Intersegment revenue
    
    
    (1
    )
    
    
    -
    
    
    
    (1
    )
    
    
    -
    
    
    
    -Total revenue (b)
    
    
    300
    
    
    
    286
    
    
    
    249
    
    
    
    317
    
    
    
    275Provision for credit losses
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    -Noninterest expense
    
    
    224
    
    
    
    217
    
    
    
    206
    
    
    
    222
    
    
    
    220Income taxes
    
    
    28
    
    
    
    26
    
    
    
    15
    
    
    
    35
    
    
    
    20Tax-equivalent adjustment
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    -Segment earnings
    
    $
    48
    
    
    
    43
    
    
    
    28
    
    
    
    60
    
    
    
    35Economic profit
    
    $
    42
    
    
    
    37
    
    
    
    22
    
    
    
    55
    
    
    
    29Risk adjusted return on capital
    
    
    90.31
    %
    
    
    82.68
    
    
    
    56.73
    
    
    
    112.79
    
    
    
    68.24Economic capital, average
    
    $
    214
    
    
    
    205
    
    
    
    194
    
    
    
    215
    
    
    
    207Cash overhead efficiency ratio (b)
    
    
    74.75
    %
    
    
    76.33
    
    
    
    82.50
    
    
    
    70.01
    
    
    
    80.04Average loans, net
    
    $
    41
    
    
    
    22
    
    
    
    36
    
    
    
    17
    
    
    
    33Average core deposits
    
    $
    453
    
    
    
    405
    
    
    
    418
    
    
    
    364
    
    
    
    278
 (a)
    Capital Management Combined represents the consolidation of Capital Managements Asset
Management, Retail Brokerage Services, and Other, which primarily serves to eliminate intersegment
revenue.(b)
    Tax-equivalent.
 (Continued)
 43




---



##### 



Table 5  BUSINESS SEGMENTS
 2008
    
    
    2007First
    
    
    Fourth
    
    
    Third
    
    
    Second
    
    
    First(Dollars in millions)
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    QuarterRETAIL BROKERAGE SERVICESNet interest income (b)
    
    $
    268
    
    
    
    311
    
    
    
    262
    
    
    
    254
    
    
    
    256Fee and other income
    
    
    1,898
    
    
    
    1,934
    
    
    
    1,202
    
    
    
    1,227
    
    
    
    1,207Intersegment revenue
    
    
    (9
    )
    
    
    (11
    )
    
    
    (7
    )
    
    
    (11
    )
    
    
    (8
    )Total revenue (b)
    
    
    2,157
    
    
    
    2,234
    
    
    
    1,457
    
    
    
    1,470
    
    
    
    1,455Provision for credit losses
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    -Noninterest expense
    
    
    1,634
    
    
    
    1,725
    
    
    
    1,038
    
    
    
    1,076
    
    
    
    1,022Income taxes
    
    
    190
    
    
    
    184
    
    
    
    154
    
    
    
    143
    
    
    
    158Tax-equivalent adjustment
    
    
    1
    
    
    
    1
    
    
    
    -
    
    
    
    -
    
    
    
    -Segment earnings
    
    $
    332
    
    
    
    324
    
    
    
    265
    
    
    
    251
    
    
    
    275Economic profit
    
    $
    279
    
    
    
    271
    
    
    
    235
    
    
    
    219
    
    
    
    244Risk adjusted return on capital
    
    
    69.23
    %
    
    
    67.17
    
    
    
    94.13
    
    
    
    88.54
    
    
    
    99.04Economic capital, average
    
    $
    1,929
    
    
    
    1,915
    
    
    
    1,116
    
    
    
    1,133
    
    
    
    1,127Cash overhead efficiency ratio (b)
    
    
    75.74
    %
    
    
    77.15
    
    
    
    71.33
    
    
    
    73.18
    
    
    
    70.22Average loans, net
    
    $
    2,521
    
    
    
    2,273
    
    
    
    2,106
    
    
    
    1,646
    
    
    
    1,521Average core deposits
    
    $
    42,631
    
    
    
    37,614
    
    
    
    31,071
    
    
    
    30,857
    
    
    
    31,405OTHERNet interest income (b)
    
    $
    -
    
    
    
    -
    
    
    
    -
    
    
    
    1
    
    
    
    -Fee and other income
    
    
    (2
    )
    
    
    (2
    )
    
    
    (2
    )
    
    
    (3
    )
    
    
    (2
    )Intersegment revenue
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    -Total revenue (b)
    
    
    (2
    )
    
    
    (2
    )
    
    
    (2
    )
    
    
    (2
    )
    
    
    (2
    )Provision for credit losses
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    -Noninterest expense
    
    
    (3
    )
    
    
    (4
    )
    
    
    (3
    )
    
    
    (4
    )
    
    
    (5
    )Income taxes
    
    
    -
    
    
    
    1
    
    
    
    -
    
    
    
    1
    
    
    
    1Tax-equivalent adjustment
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    -Segment earnings
    
    $
    1
    
    
    
    1
    
    
    
    1
    
    
    
    1
    
    
    
    2Economic profit
    
    $
    1
    
    
    
    1
    
    
    
    1
    
    
    
    1
    
    
    
    2Risk adjusted return on capital
    
    
    -
    %
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    -Economic capital, average
    
    $
    -
    
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    -Cash overhead efficiency ratio (b)
    
    
    -
    %
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    -Average loans, net
    
    $
    -
    
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    -Average core deposits
    
    $
    -
    
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    -
 (Continued)
 44




---



##### 



Table 5  BUSINESS SEGMENTS
 2008
    
    
    2007First
    
    
    Fourth
    
    
    Third
    
    
    Second
    
    
    First(Dollars in millions)
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    QuarterPARENTNet interest income (a)
    
    $
    (137
    )
    
    
    (217
    )
    
    
    (171
    )
    
    
    (100
    )
    
    
    (17
    )Fee and other income
    
    
    (456
    )
    
    
    (55
    )
    
    
    194
    
    
    
    44
    
    
    
    107Intersegment revenue
    
    
    -
    
    
    
    -
    
    
    
    (2
    )
    
    
    2
    
    
    
    1Total revenue (a)
    
    
    (593
    )
    
    
    (272
    )
    
    
    21
    
    
    
    (54
    )
    
    
    91Provision for credit losses
    
    
    2,060
    
    
    
    1,058
    
    
    
    194
    
    
    
    25
    
    
    
    23Noninterest expense
    
    
    302
    
    
    
    419
    
    
    
    485
    
    
    
    374
    
    
    
    347Minority interest
    
    
    198
    
    
    
    118
    
    
    
    189
    
    
    
    139
    
    
    
    136Income tax benefits
    
    
    (1,041
    )
    
    
    (866
    )
    
    
    (508
    )
    
    
    (339
    )
    
    
    (349
    )Tax-equivalent adjustment
    
    
    20
    
    
    
    13
    
    
    
    13
    
    
    
    17
    
    
    
    16Segment earnings (loss)
    
    $
    (2,132
    )
    
    
    (1,014
    )
    
    
    (352
    )
    
    
    (270
    )
    
    
    (82
    )Economic profit (loss)
    
    $
    (842
    )
    
    
    (338
    )
    
    
    (317
    )
    
    
    (244
    )
    
    
    (61
    )Risk adjusted return on capital
    
    
    (167.55
    )%
    
    
    (51.89
    )
    
    
    (26.84
    )
    
    
    (29.14
    )
    
    
    1.61Economic capital, average
    
    $
    1,888
    
    
    
    2,143
    
    
    
    2,394
    
    
    
    2,434
    
    
    
    2,658Cash overhead efficiency ratio (a)
    
    
    (34.17
    )%
    
    
    (113.51
    )
    
    
    1,841.86
    
    
    
    (489.55
    )
    
    
    250.80Lending commitments
    
    $
    538
    
    
    
    599
    
    
    
    529
    
    
    
    569
    
    
    
    503Average loans, net
    
    
    28,490
    
    
    
    30,748
    
    
    
    28,514
    
    
    
    30,195
    
    
    
    31,699Average core deposits
    
    $
    2,729
    
    
    
    2,483
    
    
    
    3,031
    
    
    
    2,640
    
    
    
    2,047FTE employees
    
    
    24,685
    
    
    
    25,125
    
    
    
    24,012
    
    
    
    23,553
    
    
    
    24,705
  (Continued)
 45




---



##### 



Table 5  BUSINESS SEGMENTS
 Three Months Ended March 31, 2008Net Merger-Corporate
    
    
    
    
    
    
    
    
    
    
    Relatedand
    
    
    
    
    
    
    
    
    
    
    andGeneral
    
    
    Wealth
    
    
    Investment
    
    
    Capital
    
    
    
    
    
    
    Restructuring(Dollars in millions)
    
    Bank
    
    
    Management
    
    
    Bank
    
    
    Management
    
    
    Parent
    
    
    Expenses (b)
    
    
    TotalCONSOLIDATEDNet interest income (a)
    
    $
    3,455
    
    
    
    181
    
    
    
    1,032
    
    
    
    274
    
    
    
    (137
    )
    
    
    (53
    )
    
    
    4,752Fee and other income
    
    
    990
    
    
    
    211
    
    
    
    (159
    )
    
    
    2,191
    
    
    
    (456
    )
    
    
    -
    
    
    
    2,777Intersegment revenue
    
    
    55
    
    
    
    5
    
    
    
    (50
    )
    
    
    (10
    )
    
    
    -
    
    
    
    -
    
    
    
    -Total revenue (a)
    
    
    4,500
    
    
    
    397
    
    
    
    823
    
    
    
    2,455
    
    
    
    (593
    )
    
    
    (53
    )
    
    
    7,529Provision for credit losses
    
    
    569
    
    
    
    5
    
    
    
    197
    
    
    
    -
    
    
    
    2,060
    
    
    
    -
    
    
    
    2,831Noninterest expense
    
    
    2,050
    
    
    
    246
    
    
    
    747
    
    
    
    1,855
    
    
    
    302
    
    
    
    241
    
    
    
    5,441Minority interest
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    198
    
    
    
    (43
    )
    
    
    155Income taxes (benefits)
    
    
    675
    
    
    
    54
    
    
    
    (65
    )
    
    
    218
    
    
    
    (1,041
    )
    
    
    (75
    )
    
    
    (234
    )Tax-equivalent adjustment
    
    
    11
    
    
    
    -
    
    
    
    21
    
    
    
    1
    
    
    
    20
    
    
    
    (53
    )
    
    
    -Net income (loss)
    
    
    1,195
    
    
    
    92
    
    
    
    (77
    )
    
    
    381
    
    
    
    (2,132
    )
    
    
    (123
    )
    
    
    (664
    )Dividends on preferred stock
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    43
    
    
    
    -
    
    
    
    43Net income (loss) available
to common stockholders
    
    $
    1,195
    
    
    
    92
    
    
    
    (77
    )
    
    
    381
    
    
    
    (2,175
    )
    
    
    (123
    )
    
    
    (707
    )Economic profit (loss)
    
    $
    997
    
    
    
    70
    
    
    
    (411
    )
    
    
    322
    
    
    
    (842
    )
    
    
    -
    
    
    
    136Risk adjusted return on capital
    
    
    42.58
    %
    
    
    50.80
    
    
    
    (1.49
    )
    
    
    71.51
    
    
    
    (167.55
    )
    
    
    -
    
    
    
    12.79Economic capital, average
    
    $
    12,695
    
    
    
    705
    
    
    
    13,242
    
    
    
    2,143
    
    
    
    1,888
    
    
    
    -
    
    
    
    30,673Cash overhead efficiency ratio (a)
    
    
    45.55
    %
    
    
    62.08
    
    
    
    90.76
    
    
    
    75.54
    
    
    
    (34.17
    )
    
    
    -
    
    
    
    67.22Lending commitments
    
    $
    132,165
    
    
    
    7,007
    
    
    
    113,521
    
    
    
    1,348
    
    
    
    538
    
    
    
    -
    
    
    
    254,579Average loans, net
    
    
    311,447
    
    
    
    22,413
    
    
    
    101,024
    
    
    
    2,562
    
    
    
    28,490
    
    
    
    -
    
    
    
    465,936Average core deposits
    
    $
    297,680
    
    
    
    17,397
    
    
    
    33,623
    
    
    
    43,084
    
    
    
    2,729
    
    
    
    -
    
    
    
    394,513FTE employees
    
    
    54,847
    
    
    
    4,650
    
    
    
    6,358
    
    
    
    29,838
    
    
    
    24,685
    
    
    
    -
    
    
    
    120,378
 Three Months Ended March 31, 2007Net Merger-Corporate
    
    
    
    
    
    
    
    
    
    
    Relatedand
    
    
    
    
    
    
    
    
    
    
    andGeneral
    
    
    Wealth
    
    
    Investment
    
    
    Capital
    
    
    
    
    
    
    Restructuring(Dollars in millions)
    
    Bank
    
    
    Management
    
    
    Bank
    
    
    Management
    
    
    Parent
    
    
    Expenses (b)
    
    
    TotalCONSOLIDATEDNet interest income (a)
    
    $
    3,398
    
    
    
    181
    
    
    
    716
    
    
    
    259
    
    
    
    (17
    )
    
    
    (37
    )
    
    
    4,500Fee and other income
    
    
    845
    
    
    
    196
    
    
    
    1,109
    
    
    
    1,477
    
    
    
    107
    
    
    
    -
    
    
    
    3,734Intersegment revenue
    
    
    47
    
    
    
    3
    
    
    
    (43
    )
    
    
    (8
    )
    
    
    1
    
    
    
    -
    
    
    
    -Total revenue (a)
    
    
    4,290
    
    
    
    380
    
    
    
    1,782
    
    
    
    1,728
    
    
    
    91
    
    
    
    (37
    )
    
    
    8,234Provision for credit losses
    
    
    147
    
    
    
    1
    
    
    
    6
    
    
    
    -
    
    
    
    23
    
    
    
    -
    
    
    
    177Noninterest expense
    
    
    1,869
    
    
    
    247
    
    
    
    911
    
    
    
    1,237
    
    
    
    347
    
    
    
    10
    
    
    
    4,621Minority interest
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    136
    
    
    
    -
    
    
    
    136Income taxes (benefits)
    
    
    819
    
    
    
    48
    
    
    
    305
    
    
    
    179
    
    
    
    (349
    )
    
    
    (4
    )
    
    
    998Tax-equivalent adjustment
    
    
    11
    
    
    
    -
    
    
    
    10
    
    
    
    -
    
    
    
    16
    
    
    
    (37
    )
    
    
    -Net income (loss)
    
    $
    1,444
    
    
    
    84
    
    
    
    550
    
    
    
    312
    
    
    
    (82
    )
    
    
    (6
    )
    
    
    2,302Economic
profit (loss)
    
    $
    1,123
    
    
    
    63
    
    
    
    286
    
    
    
    275
    
    
    
    (61
    )
    
    
    -
    
    
    
    1,686Risk adjusted return on capital
    
    
    53.73
    %
    
    
    54.31
    
    
    
    24.91
    
    
    
    94.78
    
    
    
    1.61
    
    
    
    -
    
    
    
    40.01Economic capital, average
    
    $
    10,662
    
    
    
    592
    
    
    
    8,329
    
    
    
    1,334
    
    
    
    2,658
    
    
    
    -
    
    
    
    23,575Cash overhead efficiency ratio (a)
    
    
    43.56
    %
    
    
    65.12
    
    
    
    51.10
    
    
    
    71.59
    
    
    
    250.80
    
    
    
    -
    
    
    
    54.33Lending commitments
    
    $
    124,253
    
    
    
    6,686
    
    
    
    110,214
    
    
    
    961
    
    
    
    503
    
    
    
    -
    
    
    
    242,617Average loans, net
    
    
    288,229
    
    
    
    20,394
    
    
    
    73,385
    
    
    
    1,554
    
    
    
    31,699
    
    
    
    -
    
    
    
    415,261Average core deposits
    
    $
    284,046
    
    
    
    17,267
    
    
    
    34,227
    
    
    
    31,683
    
    
    
    2,047
    
    
    
    -
    
    
    
    369,270FTE employees
    
    
    56,722
    
    
    
    4,589
    
    
    
    6,650
    
    
    
    17,703
    
    
    
    24,705
    
    
    
    -
    
    
    
    110,369
   46




---



##### 



Table 6  NET TRADING REVENUE  INVESTMENT BANKING (a)
 2008
    
    
    2007First
    
    
    Fourth
    
    
    Third
    
    
    Second
    
    
    First(In millions)
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    QuarterNet interest income (Tax-equivalent)
    
    $
    80
    
    
    
    51
    
    
    
    34
    
    
    
    43
    
    
    
    42Trading account profits (losses)
    
    
    (246
    )
    
    
    (564
    )
    
    
    (383
    )
    
    
    191
    
    
    
    115Other fee income
    
    
    188
    
    
    
    180
    
    
    
    141
    
    
    
    160
    
    
    
    128Total net trading revenue (Tax-equivalent)
    
    $
    22
    
    
    
    (333
    )
    
    
    (208
    )
    
    
    394
    
    
    
    285
  Table 7  SELECTED RATIOS
 2008
    
    
    2007First
    
    
    Fourth
    
    
    Third
    
    
    Second
    
    
    FirstQuarter
    
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    QuarterPERFORMANCE RATIOS (a)Assets to stockholders equity
    
    
    9.95
    X
    
    
    10.32
    
    
    
    10.44
    
    
    
    10.17
    
    
    
    9.97Return on assets (b)
    
    
    (0.34)
    %
    
    
    0.03
    
    
    
    0.88
    
    
    
    1.33
    
    
    
    1.35Return on common stockholders equity
    
    
    (3.81)
    %
    
    
    0.28
    
    
    
    9.19
    
    
    
    13.54
    
    
    
    13.47Return on total stockholders equity
    
    
    (3.39)
    %
    
    
    0.28
    
    
    
    9.19
    
    
    
    13.54
    
    
    
    13.47DIVIDEND PAYOUT RATIOSCommon shares
    
    
    (177.78)
    %
    
    
    2,133.33
    
    
    
    75.29
    
    
    
    45.90
    
    
    
    46.67
   47




---



##### 



Table 8  TRADING ACCOUNT ASSETS AND LIABILITIES
 2008
    
    
    2007First
    
    
    Fourth
    
    
    Third
    
    
    Second
    
    
    First(In millions)
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    QuarterTRADING ACCOUNT ASSETSU.S. Treasury
    
    $
    1,422
    
    
    
    604
    
    
    
    993
    
    
    
    2,348
    
    
    
    1,164U.S. Government agencies
    
    
    3,045
    
    
    
    2,811
    
    
    
    3,104
    
    
    
    2,865
    
    
    
    2,874State, county and municipal
    
    
    5,195
    
    
    
    3,898
    
    
    
    3,844
    
    
    
    3,551
    
    
    
    2,961Mortgage-backed securities
    
    
    8,488
    
    
    
    2,208
    
    
    
    2,332
    
    
    
    1,807
    
    
    
    2,591Other asset-backed securities
    
    
    8,376
    
    
    
    11,427
    
    
    
    11,704
    
    
    
    12,474
    
    
    
    9,445Corporate bonds and debentures
    
    
    5,143
    
    
    
    5,340
    
    
    
    5,379
    
    
    
    5,386
    
    
    
    4,350Equity securities
    
    
    4,051
    
    
    
    4,411
    
    
    
    3,918
    
    
    
    2,973
    
    
    
    3,298Derivative financial instruments (a)
    
    
    28,379
    
    
    
    19,116
    
    
    
    13,194
    
    
    
    9,707
    
    
    
    7,940Sundry
    
    
    8,493
    
    
    
    6,067
    
    
    
    10,367
    
    
    
    10,429
    
    
    
    9,538Total trading account assets
    
    $
    72,592
    
    
    
    55,882
    
    
    
    54,835
    
    
    
    51,540
    
    
    
    44,161TRADING ACCOUNT LIABILITIESSecurities sold short
    
    
    7,706
    
    
    
    6,287
    
    
    
    7,014
    
    
    
    9,564
    
    
    
    9,391Derivative financial instruments (a)
    
    
    21,181
    
    
    
    15,298
    
    
    
    10,757
    
    
    
    9,755
    
    
    
    7,900Total trading account liabilities
    
    $
    28,887
    
    
    
    21,585
    
    
    
    17,771
    
    
    
    19,319
    
    
    
    17,291
  48




---



##### 



Table 9  LOANS  ON-BALANCE SHEET, AND MANAGED AND SERVICING PORTFOLIOS
 2008
    
    
    2007First
    
    
    Fourth
    
    
    Third
    
    
    Second
    
    
    First(In millions)
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    QuarterON-BALANCE SHEET LOAN PORTFOLIOCOMMERCIALCommercial, financial and agricultural
    
    $
    119,193
    
    
    
    112,509
    
    
    
    109,269
    
    
    
    102,397
    
    
    
    99,687Real estate  construction and other
    
    
    18,597
    
    
    
    18,543
    
    
    
    18,167
    
    
    
    17,449
    
    
    
    16,965Real estate  mortgage
    
    
    26,370
    
    
    
    23,846
    
    
    
    21,514
    
    
    
    20,448
    
    
    
    20,130Lease financing
    
    
    23,637
    
    
    
    23,913
    
    
    
    23,966
    
    
    
    24,083
    
    
    
    24,053Foreign
    
    
    33,616
    
    
    
    29,540
    
    
    
    26,471
    
    
    
    20,959
    
    
    
    16,240Total commercial
    
    
    221,413
    
    
    
    208,351
    
    
    
    199,387
    
    
    
    185,336
    
    
    
    177,075CONSUMERReal estate secured (a)
    
    
    230,197
    
    
    
    227,719
    
    
    
    225,355
    
    
    
    220,293
    
    
    
    220,682Student loans
    
    
    9,324
    
    
    
    8,149
    
    
    
    7,742
    
    
    
    6,757
    
    
    
    8,479Installment loans
    
    
    27,437
    
    
    
    25,635
    
    
    
    24,763
    
    
    
    25,017
    
    
    
    23,665Total consumer
    
    
    266,958
    
    
    
    261,503
    
    
    
    257,860
    
    
    
    252,067
    
    
    
    252,826Total loans
    
    
    488,371
    
    
    
    469,854
    
    
    
    457,247
    
    
    
    437,403
    
    
    
    429,901Unearned income
    
    
    (7,889
    )
    
    
    (7,900
    )
    
    
    (8,041
    )
    
    
    (8,283
    )
    
    
    (8,238
    )Loans, net (On-balance sheet)
    
    $
    480,482
    
    
    
    461,954
    
    
    
    449,206
    
    
    
    429,120
    
    
    
    421,663MANAGED PORTFOLIO (b)COMMERCIALOn-balance sheet loan portfolio
    
    $
    221,413
    
    
    
    208,351
    
    
    
    199,387
    
    
    
    185,336
    
    
    
    177,075Securitized loans  off-balance sheet
    
    
    120
    
    
    
    131
    
    
    
    142
    
    
    
    170
    
    
    
    181Loans held for sale
    
    
    3,342
    
    
    
    9,414
    
    
    
    13,905
    
    
    
    11,573
    
    
    
    10,467Total commercial
    
    
    224,875
    
    
    
    217,896
    
    
    
    213,434
    
    
    
    197,079
    
    
    
    187,723CONSUMERReal estate securedOn-balance sheet loan portfolio
    
    
    230,197
    
    
    
    227,719
    
    
    
    225,355
    
    
    
    220,293
    
    
    
    220,682Securitized loans  off-balance sheet
    
    
    6,845
    
    
    
    7,230
    
    
    
    7,625
    
    
    
    8,112
    
    
    
    6,595Securitized loans included in securities
    
    
    11,683
    
    
    
    10,755
    
    
    
    5,963
    
    
    
    6,091
    
    
    
    5,629Loans held for sale
    
    
    5,960
    
    
    
    4,816
    
    
    
    3,583
    
    
    
    4,079
    
    
    
    4,089Total real estate secured
    
    
    254,685
    
    
    
    250,520
    
    
    
    242,526
    
    
    
    238,575
    
    
    
    236,995StudentOn-balance sheet loan portfolio
    
    
    9,324
    
    
    
    8,149
    
    
    
    7,742
    
    
    
    6,757
    
    
    
    8,479Securitized loans  off-balance sheet
    
    
    2,586
    
    
    
    2,811
    
    
    
    2,856
    
    
    
    2,905
    
    
    
    3,045Securitized loans included in securities
    
    
    52
    
    
    
    52
    
    
    
    52
    
    
    
    52
    
    
    
    52Loans held for sale
    
    
    -
    
    
    
    -
    
    
    
    1,968
    
    
    
    2,046
    
    
    
    -Total student
    
    
    11,962
    
    
    
    11,012
    
    
    
    12,618
    
    
    
    11,760
    
    
    
    11,576InstallmentOn-balance sheet loan portfolio
    
    
    27,437
    
    
    
    25,635
    
    
    
    24,763
    
    
    
    25,017
    
    
    
    23,665Securitized loans  off-balance sheet
    
    
    1,968
    
    
    
    2,263
    
    
    
    2,572
    
    
    
    3,105
    
    
    
    2,851Securitized loans included in securities
    
    
    39
    
    
    
    47
    
    
    
    55
    
    
    
    116
    
    
    
    126Loans held for sale
    
    
    2,127
    
    
    
    2,542
    
    
    
    1,975
    
    
    
    35
    
    
    
    476Total installment
    
    
    31,571
    
    
    
    30,487
    
    
    
    29,365
    
    
    
    28,273
    
    
    
    27,118Total consumer
    
    
    298,218
    
    
    
    292,019
    
    
    
    284,509
    
    
    
    278,608
    
    
    
    275,689Total managed portfolio
    
    $
    523,093
    
    
    
    509,915
    
    
    
    497,943
    
    
    
    475,687
    
    
    
    463,412SERVICING PORTFOLIO (c)Commercial
    
    $
    354,624
    
    
    
    353,464
    
    
    
    337,721
    
    
    
    298,374
    
    
    
    271,038Consumer
    
    $
    27,415
    
    
    
    27,967
    
    
    
    28,474
    
    
    
    26,789
    
    
    
    25,952
    49




---



##### 



Table 10  LOANS HELD FOR SALE
 
 2008
    
    
    2007First
    
    
    Fourth
    
    
    Third
    
    
    Second
    
    
    First(In millions)
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    QuarterCORE BUSINESS ACTIVITY (a)Core business activity, beginning of period
    
    $
    15,094
    
    
    
    17,646
    
    
    
    15,696
    
    
    
    15,030
    
    
    
    12,566Originations and/or purchases
    
    
    8,144
    
    
    
    8,160
    
    
    
    13,007
    
    
    
    22,671
    
    
    
    17,873Transfer to (from) loans held for sale, net
    
    
    (6,801
    )
    
    
    (1,278
    )
    
    
    2,162
    
    
    
    (71
    )
    
    
    (180
    )Allowance for loan losses related to loans
    
    
    -
    
    
    
    -
    
    
    
    (57
    )
    
    
    -
    
    
    
    -Lower of cost or market value adjustments (b)
    
    
    (364
    )
    
    
    (223
    )
    
    
    (249
    )
    
    
    (91
    )
    
    
    (3
    )Market value adjustments for fair value option loans
    
    
    42
    
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    -Performing loans sold or securitized
    
    
    (7,355
    )
    
    
    (8,992
    )
    
    
    (11,606
    )
    
    
    (20,910
    )
    
    
    (14,745
    )Other, principally payments
    
    
    (354
    )
    
    
    (219
    )
    
    
    (1,307
    )
    
    
    (933
    )
    
    
    (481
    )Core business activity, end of period
    
    
    8,406
    
    
    
    15,094
    
    
    
    17,646
    
    
    
    15,696
    
    
    
    15,030PORTFOLIO MANAGEMENT ACTIVITY (a)Portfolio business activity, beginning of period
    
    
    1,678
    
    
    
    3,785
    
    
    
    2,037
    
    
    
    2
    
    
    
    2Originations and/or purchases
    
    
    83
    
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    -Transfer to loans held for salePerforming loans (c)
    
    
    2,317
    
    
    
    137
    
    
    
    1,831
    
    
    
    2,046
    
    
    
    -Lower of
cost or market value adjustments (b)
    
    
    (31
    )
    
    
    (30
    )
    
    
    (6
    )
    
    
    (10
    )
    
    
    -Performing loans sold or securitized
    
    
    (990
    )
    
    
    (2,078
    )
    
    
    -
    
    
    
    -
    
    
    
    -Other, principally payments
    
    
    (34
    )
    
    
    (136
    )
    
    
    (77
    )
    
    
    (1
    )
    
    
    -Portfolio management activity, end of period
    
    
    3,023
    
    
    
    1,678
    
    
    
    3,785
    
    
    
    2,037
    
    
    
    2Total loans held for sale (d)
    
    $
    11,429
    
    
    
    16,772
    
    
    
    21,431
    
    
    
    17,733
    
    
    
    15,032
     50




---



##### 



Table 11  ALLOWANCE FOR CREDIT LOSSES
 
 2008
    
    
    2007First
    
    
    Fourth
    
    
    Third
    
    
    Second
    
    
    First(In millions)
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    QuarterALLOWANCE FOR CREDIT LOSSES (a)Balance, beginning of period
    
    $
    4,717
    
    
    
    3,691
    
    
    
    3,552
    
    
    
    3,533
    
    
    
    3,514Provision for credit losses
    
    
    2,834
    
    
    
    1,467
    
    
    
    381
    
    
    
    168
    
    
    
    175Provision for credit losses relating to loans
transferred to loans held for sale or sold
    
    
    7
    
    
    
    6
    
    
    
    3
    
    
    
    4
    
    
    
    1Provision for credit losses for unfunded
lending commitments
    
    
    (10
    )
    
    
    24
    
    
    
    24
    
    
    
    7
    
    
    
    1LOAN LOSSESCommercial, financial and agricultural
    
    
    (171
    )
    
    
    (67
    )
    
    
    (41
    )
    
    
    (39
    )
    
    
    (34
    )Commercial real estate  construction and mortgage
    
    
    (81
    )
    
    
    (117
    )
    
    
    (5
    )
    
    
    (4
    )
    
    
    (6
    )Total commercial
    
    
    (252
    )
    
    
    (184
    )
    
    
    (46
    )
    
    
    (43
    )
    
    
    (40
    )Real estate secured
    
    
    (351
    )
    
    
    (156
    )
    
    
    (59
    )
    
    
    (40
    )
    
    
    (33
    )Student loans
    
    
    (3
    )
    
    
    (4
    )
    
    
    (5
    )
    
    
    (2
    )
    
    
    (3
    )Installment and other loans (b)
    
    
    (242
    )
    
    
    (225
    )
    
    
    (168
    )
    
    
    (138
    )
    
    
    (142
    )Total consumer
    
    
    (596
    )
    
    
    (385
    )
    
    
    (232
    )
    
    
    (180
    )
    
    
    (178
    )Total loan losses
    
    
    (848
    )
    
    
    (569
    )
    
    
    (278
    )
    
    
    (223
    )
    
    
    (218
    )LOAN RECOVERIESCommercial, financial and agricultural
    
    
    14
    
    
    
    22
    
    
    
    9
    
    
    
    15
    
    
    
    9Commercial real estate  construction and mortgage
    
    
    1
    
    
    
    -
    
    
    
    3
    
    
    
    -
    
    
    
    3Total commercial
    
    
    15
    
    
    
    22
    
    
    
    12
    
    
    
    15
    
    
    
    12Real estate secured
    
    
    10
    
    
    
    9
    
    
    
    12
    
    
    
    11
    
    
    
    6Student loans
    
    
    1
    
    
    
    2
    
    
    
    3
    
    
    
    -
    
    
    
    1Installment and other loans (b)
    
    
    57
    
    
    
    75
    
    
    
    45
    
    
    
    47
    
    
    
    44Total consumer
    
    
    68
    
    
    
    86
    
    
    
    60
    
    
    
    58
    
    
    
    51Total loan recoveries
    
    
    83
    
    
    
    108
    
    
    
    72
    
    
    
    73
    
    
    
    63Net charge-offs
    
    
    (765
    )
    
    
    (461
    )
    
    
    (206
    )
    
    
    (150
    )
    
    
    (155
    )Allowance relating to loans acquired, transferred
to loans held for sale or sold
    
    
    (16
    )
    
    
    (10
    )
    
    
    (63
    )
    
    
    (10
    )
    
    
    (3
    )Balance, end of period
    
    $
    6,767
    
    
    
    4,717
    
    
    
    3,691
    
    
    
    3,552
    
    
    
    3,533CONSUMER REAL ESTATE SECURED NET CHARGE-OFFSFirst lien
    
    $
    (291
    )
    
    
    (122
    )
    
    
    (32
    )
    
    
    (17
    )
    
    
    (15
    )Second lien
    
    
    (50
    )
    
    
    (25
    )
    
    
    (15
    )
    
    
    (12
    )
    
    
    (12
    )Total consumer real estate secured net charge-offs
    
    $
    (341
    )
    
    
    (147
    )
    
    
    (47
    )
    
    
    (29
    )
    
    
    (27
    )ALLOWANCE FOR CREDIT LOSSESAllocation of the allowance for loan lossesCommercial
    
    $
    2,645
    
    
    
    2,392
    
    
    
    2,054
    
    
    
    1,889
    
    
    
    1,879Consumer
    
    
    3,592
    
    
    
    1,950
    
    
    
    1,246
    
    
    
    1,371
    
    
    
    1,354Unallocated
    
    
    330
    
    
    
    165
    
    
    
    205
    
    
    
    130
    
    
    
    145Total allowance for loan losses
    
    
    6,567
    
    
    
    4,507
    
    
    
    3,505
    
    
    
    3,390
    
    
    
    3,378Reserve for unfunded lending commitments
    
    
    200
    
    
    
    210
    
    
    
    186
    
    
    
    162
    
    
    
    155Total allowance for credit losses
    
    $
    6,767
    
    
    
    4,717
    
    
    
    3,691
    
    
    
    3,552
    
    
    
    3,533
   51




---



##### 



Table 12  ALLOWANCE AND CHARGE-OFF RATIOS
 
 2008
    
    
    2007First
    
    
    Fourth
    
    
    Third
    
    
    Second
    
    
    First(In millions)
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    QuarterALLOWANCE FOR LOAN LOSSESas % of loans, net
    
    
    1.37
    %
    
    
    0.98
    
    
    
    0.78
    
    
    
    0.79
    
    
    
    0.80as % of nonaccrual and restructured loans (a)
    
    
    84
    
    
    
    90
    
    
    
    129
    
    
    
    174
    
    
    
    207as % of nonperforming assets (a)
    
    
    78
    
    
    
    84
    
    
    
    115
    
    
    
    157
    
    
    
    189ALLOWANCE FOR CREDIT LOSSESas % of loans, net
    
    
    1.41
    %
    
    
    1.02
    
    
    
    0.82
    
    
    
    0.83
    
    
    
    0.84NET CHARGE-OFFS AS % OF AVERAGE LOANS, NET (b)Commercial, financial and agricultural
    
    
    0.41
    %
    
    
    0.12
    
    
    
    0.10
    
    
    
    0.07
    
    
    
    0.08Commercial real estate  construction and mortgage
    
    
    0.73
    
    
    
    1.12
    
    
    
    0.02
    
    
    
    0.04
    
    
    
    0.04Total commercial
    
    
    0.48
    
    
    
    0.34
    
    
    
    0.08
    
    
    
    0.07
    
    
    
    0.07Real estate secured
    
    
    0.59
    
    
    
    0.26
    
    
    
    0.08
    
    
    
    0.05
    
    
    
    0.05Student loans
    
    
    0.08
    
    
    
    0.10
    
    
    
    0.14
    
    
    
    0.07
    
    
    
    0.10Installment and other loans (c)
    
    
    2.76
    
    
    
    2.35
    
    
    
    1.99
    
    
    
    1.47
    
    
    
    1.67Total consumer
    
    
    0.79
    
    
    
    0.46
    
    
    
    0.27
    
    
    
    0.19
    
    
    
    0.20Total as % of average loans, net
    
    
    0.66
    %
    
    
    0.41
    
    
    
    0.19
    
    
    
    0.14
    
    
    
    0.15
    52




---



##### 



Table 13  NONPERFORMING ASSETS
 2008
    
    
    2007First
    
    
    Fourth
    
    
    Third
    
    
    Second
    
    
    First(In millions)
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    QuarterNONPERFORMING ASSETSNonaccrual loansCommercialCommercial, financial and agricultural
    
    $
    908
    
    
    
    602
    
    
    
    354
    
    
    
    318
    
    
    
    303Commercial real estate  construction and mortgage
    
    
    1,750
    
    
    
    1,059
    
    
    
    289
    
    
    
    161
    
    
    
    117Total commercial
    
    
    2,658
    
    
    
    1,661
    
    
    
    643
    
    
    
    479
    
    
    
    420ConsumerReal estate securedFirst lien
    
    
    5,015
    
    
    
    3,234
    
    
    
    1,986
    
    
    
    1,380
    
    
    
    1,124Second lien
    
    
    75
    
    
    
    58
    
    
    
    41
    
    
    
    44
    
    
    
    37Installment and other loans (a)
    
    
    40
    
    
    
    42
    
    
    
    45
    
    
    
    42
    
    
    
    51Total consumer
    
    
    5,130
    
    
    
    3,334
    
    
    
    2,072
    
    
    
    1,466
    
    
    
    1,212Total nonaccrual loans
    
    
    7,788
    
    
    
    4,995
    
    
    
    2,715
    
    
    
    1,945
    
    
    
    1,632Troubled debt restructurings (b)
    
    
    48
    
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    -Foreclosed properties
    
    
    530
    
    
    
    389
    
    
    
    334
    
    
    
    207
    
    
    
    155Total nonperforming assets
    
    $
    8,366
    
    
    
    5,384
    
    
    
    3,049
    
    
    
    2,152
    
    
    
    1,787as % of loans, net, and foreclosed properties (c)
    
    
    1.74
    %
    
    
    1.16
    
    
    
    0.68
    
    
    
    0.50
    
    
    
    0.42Nonperforming assets included in loans held for saleCommercial
    
    $
    -
    
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    1Consumer
    
    
    5
    
    
    
    62
    
    
    
    50
    
    
    
    37
    
    
    
    23Total nonaccrual loans
    
    
    5
    
    
    
    62
    
    
    
    50
    
    
    
    37
    
    
    
    24Foreclosed properties
    
    
    -
    
    
    
    -
    
    
    
    9
    
    
    
    5
    
    
    
    2Total nonperforming assets included in loans held for sale
    
    
    5
    
    
    
    62
    
    
    
    59
    
    
    
    42
    
    
    
    26Nonperforming assets included in loans and
in loans held for sale
    
    $
    8,371
    
    
    
    5,446
    
    
    
    3,108
    
    
    
    2,194
    
    
    
    1,813as % of loans, net, foreclosed properties and loans
held for sale (d)
    
    
    1.70
    %
    
    
    1.14
    
    
    
    0.66
    
    
    
    0.49
    
    
    
    0.42PAST DUE LOANS 90 DAYS AND OVER,
AND NONACCRUAL LOANS (c)Accruing loans past due 90 days and over
    
    $
    1,047
    
    
    
    708
    
    
    
    590
    
    
    
    562
    
    
    
    555Nonaccrual loans
    
    
    7,788
    
    
    
    4,995
    
    
    
    2,715
    
    
    
    1,945
    
    
    
    1,632Total past due loans 90 days and over, and
nonaccrual loans
    
    $
    8,835
    
    
    
    5,703
    
    
    
    3,305
    
    
    
    2,507
    
    
    
    2,187Commercial as % of loans, net
    
    
    1.31
    %
    
    
    0.89
    
    
    
    0.38
    
    
    
    0.31
    
    
    
    0.28Consumer as % of loans, net
    
    
    2.26
    %
    
    
    1.49
    
    
    
    1.00
    
    
    
    0.78
    
    
    
    0.68
 
 53




---



##### 



Table 14  NONACCRUAL LOAN ACTIVITY (a)
 2008
    
    
    2007First
    
    
    Fourth
    
    
    Third
    
    
    Second
    
    
    First(In millions)
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    QuarterBalance, beginning of period
    
    $
    4,995
    
    
    
    2,715
    
    
    
    1,945
    
    
    
    1,632
    
    
    
    1,234COMMERCIAL NONACCRUAL LOAN ACTIVITYCommercial nonaccrual loans, beginning of period
    
    
    1,661
    
    
    
    643
    
    
    
    479
    
    
    
    420
    
    
    
    319New nonaccrual loans and advances
    
    
    1,421
    
    
    
    1,303
    
    
    
    298
    
    
    
    205
    
    
    
    196Gross charge-offs
    
    
    (252
    )
    
    
    (184
    )
    
    
    (46
    )
    
    
    (43
    )
    
    
    (40
    )Transfers to other real estate owned
    
    
    (26
    )
    
    
    -
    
    
    
    (5
    )
    
    
    (2
    )
    
    
    -Sales
    
    
    (33
    )
    
    
    (26
    )
    
    
    (14
    )
    
    
    (15
    )
    
    
    (1
    )Other, principally payments
    
    
    (113
    )
    
    
    (75
    )
    
    
    (69
    )
    
    
    (86
    )
    
    
    (54
    )Net commercial nonaccrual loan activity
    
    
    997
    
    
    
    1,018
    
    
    
    164
    
    
    
    59
    
    
    
    101Commercial nonaccrual loans, end of period
    
    
    2,658
    
    
    
    1,661
    
    
    
    643
    
    
    
    479
    
    
    
    420CONSUMER NONACCRUAL LOAN ACTIVITYConsumer nonaccrual loans, beginning of period
    
    
    3,334
    
    
    
    2,072
    
    
    
    1,466
    
    
    
    1,212
    
    
    
    915New nonaccrual loans, advances and other, net
    
    
    1,696
    
    
    
    1,262
    
    
    
    606
    
    
    
    257
    
    
    
    297Transfers from loans held for sale
    
    
    100
    
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    -Sales and securitizations
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    (3
    )
    
    
    -Net consumer nonaccrual loan activity
    
    
    1,796
    
    
    
    1,262
    
    
    
    606
    
    
    
    254
    
    
    
    297Consumer nonaccrual loans, end of period
    
    
    5,130
    
    
    
    3,334
    
    
    
    2,072
    
    
    
    1,466
    
    
    
    1,212Balance, end of period
    
    $
    7,788
    
    
    
    4,995
    
    
    
    2,715
    
    
    
    1,945
    
    
    
    1,632
  54




---



##### 



Table 15  GOODWILL AND OTHER INTANGIBLE ASSETS
 2008
    
    
    2007First
    
    
    Fourth
    
    
    Third
    
    
    Second
    
    
    First(In millions)
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    QuarterGoodwill
    
    $
    43,068
    
    
    
    43,122
    
    
    
    38,848
    
    
    
    38,766
    
    
    
    38,838Deposit base
    
    
    573
    
    
    
    619
    
    
    
    670
    
    
    
    727
    
    
    
    796Customer relationships
    
    
    1,375
    
    
    
    1,410
    
    
    
    620
    
    
    
    651
    
    
    
    684Tradename
    
    
    90
    
    
    
    90
    
    
    
    90
    
    
    
    90
    
    
    
    90Total goodwill and other intangible assets
    
    $
    45,106
    
    
    
    45,241
    
    
    
    40,228
    
    
    
    40,234
    
    
    
    40,408
 Three Months Ended March 31, 2008Employee
    
    
    OccupancyTermination
    
    
    and(In millions)
    
    Benefits
    
    
    Equipment
    
    
    Other
    
    
    TotalEXIT COST PURCHASE ACCOUNTING ACCRUAL
ACTIVITYWachovia/A.G. Edwards  October 1, 2007Balance, December 31, 2007
    
    $
    16
    
    
    
    -
    
    
    
    -
    
    
    
    16Purchase accounting adjustments
    
    
    25
    
    
    
    -
    
    
    
    -
    
    
    
    25Cash payments
    
    
    (9
    )
    
    
    -
    
    
    
    -
    
    
    
    (9
    )Balance, March 31, 2008
    
    $
    32
    
    
    
    -
    
    
    
    -
    
    
    
    32EXIT COST PURCHASE ACCOUNTING ACCRUAL
ACTIVITYWachovia/Golden West  October 1, 2006Balance, December 31, 2007
    
    $
    49
    
    
    
    9
    
    
    
    -
    
    
    
    58Purchase accounting adjustments
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    -Cash payments
    
    
    (20
    )
    
    
    -
    
    
    
    -
    
    
    
    (20
    )Balance, March 31, 2008
    
    $
    29
    
    
    
    9
    
    
    
    -
    
    
    
    38EXIT COST PURCHASE ACCOUNTING ACCRUAL
ACTIVITYWachovia/SouthTrust  November 1, 2004Balance, December 31, 2007
    
    $
    37
    
    
    
    -
    
    
    
    -
    
    
    
    37Purchase accounting adjustments
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    -Cash payments
    
    
    (7
    )
    
    
    -
    
    
    
    -
    
    
    
    (7
    )Balance, March 31, 2008
    
    $
    30
    
    
    
    -
    
    
    
    -
    
    
    
    30
 55




---



##### 



Table 16  DEPOSITS
 2008
    
    
    2007First
    
    
    Fourth
    
    
    Third
    
    
    Second
    
    
    First(In millions)
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    QuarterCORE DEPOSITSNoninterest-bearing
    
    $
    60,951
    
    
    
    60,893
    
    
    
    56,825
    
    
    
    62,112
    
    
    
    63,399Savings and NOW accounts
    
    
    87,920
    
    
    
    88,078
    
    
    
    81,037
    
    
    
    82,629
    
    
    
    85,404Money market accounts
    
    
    128,839
    
    
    
    124,651
    
    
    
    114,457
    
    
    
    111,666
    
    
    
    108,607Other consumer time
    
    
    120,852
    
    
    
    123,783
    
    
    
    125,546
    
    
    
    121,781
    
    
    
    119,948Total core deposits
    
    
    398,562
    
    
    
    397,405
    
    
    
    377,865
    
    
    
    378,188
    
    
    
    377,358OTHER DEPOSITSForeign
    
    
    27,399
    
    
    
    27,386
    
    
    
    27,226
    
    
    
    23,324
    
    
    
    20,133Other time
    
    
    19,003
    
    
    
    24,338
    
    
    
    16,846
    
    
    
    8,518
    
    
    
    7,779Total deposits
    
    $
    444,964
    
    
    
    449,129
    
    
    
    421,937
    
    
    
    410,030
    
    
    
    405,270
 Table 17  TIME DEPOSITS IN AMOUNTS OF $100,000 OR MORE
 March 31, 2008(In millions)MATURITY OF3 months or less
    
    $
    32,144Over 3 months through 6 months
    
    
    16,241Over 6 months through 12 months
    
    
    8,541Over 12 months
    
    
    6,660Total time deposits in amounts of $100,000 or more
    
    $
    63,586
 56




---



##### 



Table 18  LONG-TERM DEBT
 2008
    
    
    2007First
    
    
    Fourth
    
    
    Third
    
    
    Second
    
    
    First(In millions)
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    QuarterNOTES AND DEBENTURES ISSUED BYTHE PARENT COMPANYNotesFloating rate, 2.69% to 4.39%, due 2008 to 2017
    
    $
    15,513
    
    
    
    15,514
    
    
    
    15,401
    
    
    
    13,651
    
    
    
    11,151Equity-linked and commodity-linked, due 2008 to 2012
    
    
    814
    
    
    
    792
    
    
    
    1,047
    
    
    
    1,055
    
    
    
    9883.50% to 5.80%, due 2008 to 2020
    
    
    11,508
    
    
    
    9,011
    
    
    
    8,551
    
    
    
    8,193
    
    
    
    6,835Floating rate, EMTN notes, due 2011 to 2014
    
    
    3,955
    
    
    
    3,649
    
    
    
    3,549
    
    
    
    3,370
    
    
    
    3,321Floating rate, Australian notes, due 2012
    
    
    822
    
    
    
    789
    
    
    
    799
    
    
    
    764
    
    
    
    -6.75%, Australian notes, due 2012
    
    
    137
    
    
    
    131
    
    
    
    133
    
    
    
    127
    
    
    
    -4.375%, EMTN notes, due 2016
    
    
    1,181
    
    
    
    1,090
    
    
    
    1,060
    
    
    
    1,006
    
    
    
    992Subordinated notes4.875% to 6.40%, due 2008 to 2035
    
    
    6,491
    
    
    
    6,454
    
    
    
    6,452
    
    
    
    6,449
    
    
    
    6,441Floating rate, due 2015 to 2016
    
    
    1,250
    
    
    
    1,250
    
    
    
    1,250
    
    
    
    1,250
    
    
    
    1,2504.375% to 4.875%, EMTN notes, due 2018 to 2035
    
    
    2,158
    
    
    
    2,099
    
    
    
    2,112
    
    
    
    2,055
    
    
    
    2,0136.605%, due 2025
    
    
    250
    
    
    
    250
    
    
    
    250
    
    
    
    250
    
    
    
    2506.30%, Putable/Callable, due 2028
    
    
    200
    
    
    
    200
    
    
    
    200
    
    
    
    200
    
    
    
    200Floating rate, hybrid trust securities, due 2037 to 2047
    
    
    2,513
    
    
    
    2,513
    
    
    
    1,675
    
    
    
    1,675
    
    
    
    8755.20%, income trust securities, due 2042
    
    
    2,501
    
    
    
    2,501
    
    
    
    2,501
    
    
    
    2,501
    
    
    
    2,501Subordinated debentures6.55% to 7.574%, due 2026 to 2035
    
    
    795
    
    
    
    795
    
    
    
    795
    
    
    
    795
    
    
    
    795Hedge-related basis adjustments
    
    
    1,073
    
    
    
    406
    
    
    
    (139
    )
    
    
    (660
    )
    
    
    (74
    )Total notes and debentures issued by theParent Company
    
    
    51,161
    
    
    
    47,444
    
    
    
    45,636
    
    
    
    42,681
    
    
    
    37,538NOTES ISSUED BY SUBSIDIARIESPrimarily notes issued under global bank note programs,varying rates and terms to 2040
    
    
    29,550
    
    
    
    23,562
    
    
    
    21,226
    
    
    
    21,537
    
    
    
    21,911Floating rate, 2.59% to 3.20%, due 2008 to 2011
    
    
    5,133
    
    
    
    5,133
    
    
    
    7,133
    
    
    
    7,133
    
    
    
    7,7304.125% to 4.75%, due 2009 to 2012
    
    
    1,690
    
    
    
    2,390
    
    
    
    2,389
    
    
    
    2,689
    
    
    
    2,687Floating rate, EMTN notes, due 2009 to 2011
    
    
    4,652
    
    
    
    4,316
    
    
    
    3,907
    
    
    
    3,710
    
    
    
    3,657Subordinated notesBank, 2.971% to 9.625%, due 2008 to 2038
    
    
    12,802
    
    
    
    12,955
    
    
    
    9,532
    
    
    
    9,533
    
    
    
    9,5357.95%
    
    
    -
    
    
    
    -
    
    
    
    100
    
    
    
    100
    
    
    
    100Floating rate, due 2013
    
    
    417
    
    
    
    417
    
    
    
    417
    
    
    
    417
    
    
    
    4176.75%, Australian notes, due 2017
    
    
    182
    
    
    
    175
    
    
    
    176
    
    
    
    169
    
    
    
    -Floating rate, Australian notes, due 2017
    
    
    183
    
    
    
    175
    
    
    
    177
    
    
    
    170
    
    
    
    -5.25%, EMTN notes, due 2023
    
    
    1,475
    
    
    
    1,477
    
    
    
    1,512
    
    
    
    1,488
    
    
    
    1,455Total notes issued by subsidiaries
    
    
    56,084
    
    
    
    50,600
    
    
    
    46,569
    
    
    
    46,946
    
    
    
    47,492OTHER DEBTAuto secured financing, 2.56% to 9.05%, due 2008 to 2015
    
    
    6,147
    
    
    
    6,679
    
    
    
    7,748
    
    
    
    8,994
    
    
    
    8,289Collateralized notes
    
    
    -
    
    
    
    4,300
    
    
    
    4,300
    
    
    
    4,420
    
    
    
    4,420Junior subordinated debentures, floating rate, due 2026 to 2029
    
    
    3,110
    
    
    
    3,098
    
    
    
    3,099
    
    
    
    3,100
    
    
    
    3,097Advances
from the Federal Home Loan Bank, 1.00% to 8.45%, due 2008 to 2031
    
    
    53,209
    
    
    
    41,888
    
    
    
    43,017
    
    
    
    30,542
    
    
    
    34,699Preferred units issued by subsidiaries
    
    
    2,852
    
    
    
    2,852
    
    
    
    2,852
    
    
    
    2,852
    
    
    
    2,852Capitalized leases
    
    
    7
    
    
    
    8
    
    
    
    9
    
    
    
    9
    
    
    
    9Mortgage notes and other debt of subsidiaries, varying rates and terms
    
    
    2,467
    
    
    
    3,870
    
    
    
    5,411
    
    
    
    2,809
    
    
    
    3,916Hedge-related basis adjustments
    
    
    616
    
    
    
    268
    
    
    
    (57
    )
    
    
    (306
    )
    
    
    22Total other debt
    
    
    68,408
    
    
    
    62,963
    
    
    
    66,379
    
    
    
    52,420
    
    
    
    57,304Total long-term debt
    
    $
    175,653
    
    
    
    161,007
    
    
    
    158,584
    
    
    
    142,047
    
    
    
    142,334
 57




---



##### 



Table 19  CHANGES IN STOCKHOLDERS EQUITY
 2008
    
    
    2007First
    
    
    Fourth
    
    
    Third
    
    
    Second
    
    
    First(In millions)
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    QuarterBalance, beginning of period, as reported
    
    $
    76,872
    
    
    
    70,140
    
    
    
    69,266
    
    
    
    69,786
    
    
    
    69,716Cumulative effect of accountingchanges, net of income taxes (a)
    
    
    (24
    )
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    (1,447
    )Balance, beginning of period
    
    
    76,848
    
    
    
    70,140
    
    
    
    69,266
    
    
    
    69,786
    
    
    
    68,269Comprehensive incomeNet income (loss)
    
    
    (664
    )
    
    
    51
    
    
    
    1,618
    
    
    
    2,341
    
    
    
    2,302Unamortized gains and losses under employee benefit plans
    
    
    6
    
    
    
    561
    
    
    
    16
    
    
    
    31
    
    
    
    -Net unrealized gains (losses) on debt and equity securities
    
    
    (705
    )
    
    
    459
    
    
    
    493
    
    
    
    (1,284
    )
    
    
    101Net unrealized gains (losses) on derivative financial instruments
    
    
    91
    
    
    
    164
    
    
    
    3
    
    
    
    (76
    )
    
    
    65Total comprehensive income
    
    
    (1,272
    )
    
    
    1,235
    
    
    
    2,130
    
    
    
    1,012
    
    
    
    2,468Purchases of common stock
    
    
    (20
    )
    
    
    -
    
    
    
    (190
    )
    
    
    (723
    )
    
    
    (284
    )Preferred shares issued
    
    
    3,497
    
    
    
    2,263
    
    
    
    -
    
    
    
    -
    
    
    
    -Common stock issued forStock options and restricted stock
    
    
    372
    
    
    
    404
    
    
    
    35
    
    
    
    132
    
    
    
    644Acquisitions
    
    
    -
    
    
    
    3,942
    
    
    
    -
    
    
    
    -
    
    
    
    -Deferred compensation, net
    
    
    (116
    )
    
    
    152
    
    
    
    114
    
    
    
    125
    
    
    
    (240
    )Cash dividendsPreferred shares
    
    
    (43
    )
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    -Common shares
    
    
    (1,274
    )
    
    
    (1,264
    )
    
    
    (1,215
    )
    
    
    (1,066
    )
    
    
    (1,071
    )Balance, end of period
    
    $
    77,992
    
    
    
    76,872
    
    
    
    70,140
    
    
    
    69,266
    
    
    
    69,786
  58




---



##### 



Table 20  CAPITAL RATIOS
 2008
    
    
    2007First
    
    
    Fourth
    
    
    Third
    
    
    Second
    
    
    First(In millions)
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    QuarterCONSOLIDATED CAPITAL RATIOS (a)Qualifying capitalTier 1 capital
    
    $
    45,353
    
    
    
    43,528
    
    
    
    41,853
    
    
    
    41,516
    
    
    
    39,790Total capital
    
    
    73,684
    
    
    
    70,003
    
    
    
    63,948
    
    
    
    63,705
    
    
    
    61,803Adjusted risk-weighted assets
    
    
    611,596
    
    
    
    592,065
    
    
    
    589,844
    
    
    
    555,702
    
    
    
    541,628Adjusted leverage ratio assets
    
    $
    734,233
    
    
    
    714,633
    
    
    
    686,373
    
    
    
    666,646
    
    
    
    653,994RatiosTier 1 capital
    
    
    7.42
    %
    
    
    7.35
    
    
    
    7.10
    
    
    
    7.47
    
    
    
    7.35Total capital
    
    
    12.05
    
    
    
    11.82
    
    
    
    10.84
    
    
    
    11.46
    
    
    
    11.41Leverage
    
    
    6.18
    
    
    
    6.09
    
    
    
    6.10
    
    
    
    6.23
    
    
    
    6.08STOCKHOLDERS EQUITY TO ASSETSQuarter-end
    
    
    9.65
    
    
    
    9.82
    
    
    
    9.30
    
    
    
    9.68
    
    
    
    9.93Average
    
    
    10.05
    %
    
    
    9.69
    
    
    
    9.58
    
    
    
    9.84
    
    
    
    10.03BANK CAPITAL RATIOSTier 1 capitalWachovia Bank, National Association
    
    
    7.50
    %
    
    
    7.50
    
    
    
    7.09
    
    
    
    7.34
    
    
    
    7.28Wachovia Bank of Delaware, National Association
    
    
    15.04
    
    
    
    15.60
    
    
    
    17.14
    
    
    
    18.37
    
    
    
    17.82Wachovia Mortgage, FSB (b)
    
    
    11.46
    
    
    
    12.97
    
    
    
    13.44
    
    
    
    16.07
    
    
    
    14.37Wachovia Bank, FSB (c)
    
    
    19.66
    
    
    
    17.07
    
    
    
    15.94
    
    
    
    12.42
    
    
    
    -Total capitalWachovia Bank, National Association
    
    
    11.72
    
    
    
    11.45
    
    
    
    10.57
    
    
    
    10.95
    
    
    
    10.94Wachovia Bank of Delaware, National Association
    
    
    17.07
    
    
    
    17.67
    
    
    
    19.27
    
    
    
    20.29
    
    
    
    19.41Wachovia Mortgage, FSB (b)
    
    
    12.73
    
    
    
    14.06
    
    
    
    13.81
    
    
    
    16.45
    
    
    
    14.77Wachovia Bank, FSB (c)
    
    
    20.91
    
    
    
    17.95
    
    
    
    16.25
    
    
    
    12.83
    
    
    
    -LeverageWachovia Bank, National Association
    
    
    6.39
    
    
    
    6.71
    
    
    
    6.69
    
    
    
    6.72
    
    
    
    6.62Wachovia Bank of Delaware, National Association
    
    
    9.99
    
    
    
    9.82
    
    
    
    15.66
    
    
    
    14.33
    
    
    
    13.42Wachovia Mortgage, FSB (b)
    
    
    6.11
    
    
    
    6.88
    
    
    
    7.17
    
    
    
    8.78
    
    
    
    7.84Wachovia Bank, FSB (c)
    
    
    6.26
    %
    
    
    5.94
    
    
    
    5.50
    
    
    
    5.20
    
    
    
    -
    59




---



##### 



WACHOVIA CORPORATION AND SUBSIDIARIES  NET INTEREST INCOME SUMMARIES
 FIRST QUARTER 2008
    
    
    FOURTH QUARTER 2007Average
    
    
    
    
    
    
    
    
    
    
    AverageInterest
    
    
    Rates
    
    
    
    
    
    
    Interest
    
    
    RatesAverage
    
    
    Income/
    
    
    Earned/
    
    
    Average
    
    
    Income/
    
    
    Earned/(In millions)
    
    Balances
    
    
    Expense
    
    
    Paid
    
    
    Balances
    
    
    Expense
    
    
    PaidASSETSInterest-bearing bank balances
    
    $
    4,253
    
    
    
    51
    
    
    
    4.85
    %
    
    $
    5,083
    
    
    
    64
    
    
    
    5.05
    %Federal funds sold and securities
purchased under resale agreements
    
    
    11,865
    
    
    
    103
    
    
    
    3.49
    
    
    
    12,901
    
    
    
    155
    
    
    
    4.77Trading account assets (a)
    
    
    44,655
    
    
    
    589
    
    
    
    5.28
    
    
    
    37,694
    
    
    
    569
    
    
    
    6.04Securities (a)
    
    
    110,401
    
    
    
    1,545
    
    
    
    5.60
    
    
    
    115,436
    
    
    
    1,625
    
    
    
    5.62Loans (a) (b)CommercialCommercial, financial and agricultural
    
    
    115,377
    
    
    
    1,671
    
    
    
    5.82
    
    
    
    111,500
    
    
    
    1,908
    
    
    
    6.79Real estate  construction and other
    
    
    18,634
    
    
    
    251
    
    
    
    5.42
    
    
    
    18,435
    
    
    
    318
    
    
    
    6.85Real estate  mortgage
    
    
    25,291
    
    
    
    374
    
    
    
    5.95
    
    
    
    22,973
    
    
    
    426
    
    
    
    7.36Lease financing
    
    
    7,167
    
    
    
    140
    
    
    
    7.79
    
    
    
    7,374
    
    
    
    145
    
    
    
    7.82Foreign
    
    
    32,109
    
    
    
    389
    
    
    
    4.86
    
    
    
    27,882
    
    
    
    380
    
    
    
    5.42Total commercial
    
    
    198,578
    
    
    
    2,825
    
    
    
    5.72
    
    
    
    188,164
    
    
    
    3,177
    
    
    
    6.70ConsumerReal estate secured
    
    
    231,392
    
    
    
    3,926
    
    
    
    6.79
    
    
    
    227,893
    
    
    
    4,042
    
    
    
    7.08Student loans
    
    
    9,155
    
    
    
    113
    
    
    
    4.96
    
    
    
    8,073
    
    
    
    126
    
    
    
    6.19Installment loans
    
    
    26,811
    
    
    
    659
    
    
    
    9.88
    
    
    
    25,675
    
    
    
    651
    
    
    
    10.04Total consumer
    
    
    267,358
    
    
    
    4,698
    
    
    
    7.04
    
    
    
    261,641
    
    
    
    4,819
    
    
    
    7.35Total loans
    
    
    465,936
    
    
    
    7,523
    
    
    
    6.48
    
    
    
    449,805
    
    
    
    7,996
    
    
    
    7.08Loans held for sale
    
    
    11,592
    
    
    
    223
    
    
    
    7.71
    
    
    
    18,998
    
    
    
    360
    
    
    
    7.53Other earning assets
    
    
    10,331
    
    
    
    146
    
    
    
    5.69
    
    
    
    10,223
    
    
    
    166
    
    
    
    6.48Total earning assets excluding derivatives
    
    
    659,033
    
    
    
    10,180
    
    
    
    6.19
    
    
    
    650,140
    
    
    
    10,935
    
    
    
    6.70Risk management derivatives (c)
    
    
    -
    
    
    
    52
    
    
    
    0.04
    
    
    
    -
    
    
    
    19
    
    
    
    0.01Total earning assets including derivatives
    
    
    659,033
    
    
    
    10,232
    
    
    
    6.23
    
    
    
    650,140
    
    
    
    10,954
    
    
    
    6.71Cash and due from banks
    
    
    11,645
    
    
    
    
    
    
    
    
    
    
    
    12,028Other assets
    
    
    112,915
    
    
    
    
    
    
    
    
    
    
    
    101,319Total assets
    
    $
    783,593
    
    
    
    
    
    
    
    
    
    
    $
    763,487LIABILITIES AND STOCKHOLDERS EQUITYInterest-bearing depositsSavings and NOW accounts
    
    
    86,452
    
    
    
    236
    
    
    
    1.10
    
    
    
    83,370
    
    
    
    345
    
    
    
    1.64Money market accounts
    
    
    128,074
    
    
    
    747
    
    
    
    2.34
    
    
    
    121,717
    
    
    
    949
    
    
    
    3.09Other consumer time
    
    
    123,655
    
    
    
    1,437
    
    
    
    4.68
    
    
    
    127,061
    
    
    
    1,557
    
    
    
    4.86Foreign
    
    
    26,197
    
    
    
    231
    
    
    
    3.55
    
    
    
    27,354
    
    
    
    306
    
    
    
    4.44Other time
    
    
    22,643
    
    
    
    265
    
    
    
    4.71
    
    
    
    20,169
    
    
    
    263
    
    
    
    5.16Total interest-bearing deposits
    
    
    387,021
    
    
    
    2,916
    
    
    
    3.03
    
    
    
    379,671
    
    
    
    3,420
    
    
    
    3.57Federal funds purchased and securities
sold under repurchase agreements
    
    
    35,956
    
    
    
    308
    
    
    
    3.45
    
    
    
    36,386
    
    
    
    413
    
    
    
    4.50Commercial paper
    
    
    5,509
    
    
    
    38
    
    
    
    2.74
    
    
    
    7,272
    
    
    
    78
    
    
    
    4.27Securities sold short
    
    
    6,919
    
    
    
    62
    
    
    
    3.63
    
    
    
    6,728
    
    
    
    61
    
    
    
    3.62Other short-term borrowings
    
    
    10,154
    
    
    
    45
    
    
    
    1.77
    
    
    
    10,369
    
    
    
    58
    
    
    
    2.24Long-term debt
    
    
    165,540
    
    
    
    1,961
    
    
    
    4.75
    
    
    
    158,704
    
    
    
    2,129
    
    
    
    5.34Total interest-bearing liabilities excluding derivatives
    
    
    611,099
    
    
    
    5,330
    
    
    
    3.51
    
    
    
    599,130
    
    
    
    6,159
    
    
    
    4.08Risk management derivatives (c)
    
    
    -
    
    
    
    97
    
    
    
    0.06
    
    
    
    -
    
    
    
    121
    
    
    
    0.08Total interest-bearing liabilities including derivatives
    
    
    611,099
    
    
    
    5,427
    
    
    
    3.57
    
    
    
    599,130
    
    
    
    6,280
    
    
    
    4.16Noninterest-bearing deposits
    
    
    56,332
    
    
    
    
    
    
    
    
    
    
    
    57,895Other liabilities
    
    
    37,415
    
    
    
    
    
    
    
    
    
    
    
    32,476Stockholders equity
    
    
    78,747
    
    
    
    
    
    
    
    
    
    
    
    73,986Total liabilities and stockholders equity
    
    $
    783,593
    
    
    
    
    
    
    
    
    
    
    $
    763,487Interest income and rate earned  including derivatives
    
    
    
    
    
    $
    10,232
    
    
    
    6.23
    %
    
    
    
    
    
    $
    10,954
    
    
    
    6.71
    %Interest expense and equivalent rate paid  including derivatives
    
    
    
    
    
    
    5,427
    
    
    
    3.31
    
    
    
    
    
    
    
    6,280
    
    
    
    3.83Net interest income and margin  including derivatives
    
    
    
    
    
    $
    4,805
    
    
    
    2.92
    %
    
    
    
    
    
    $
    4,674
    
    
    
    2.88
    %
 
 60




---



##### 



THIRD QUARTER 2007
    
    
    SECOND QUARTER 2007
    
    
    FIRST QUARTER 2007Average
    
    
    
    
    
    
    
    
    
    
    Average
    
    
    
    
    
    
    
    
    
    
    AverageInterest
    
    
    Rates
    
    
    
    
    
    
    Interest
    
    
    Rates
    
    
    
    
    
    
    Interest
    
    
    RatesAverage
    
    
    Income/
    
    
    Earned/
    
    
    Average
    
    
    Income/
    
    
    Earned/
    
    
    Average
    
    
    Income/
    
    
    Earned/Balances
    
    
    Expense
    
    
    Paid
    
    
    Balances
    
    
    Expense
    
    
    Paid
    
    
    Balances
    
    
    Expense
    
    
    Paid$
    6,459
    
    
    
    93
    
    
    
    5.68
    %
    
    $
    3,384
    
    
    
    50
    
    
    
    6.00
    %
    
    $
    1,523
    
    
    
    30
    
    
    
    7.80
    %14,206
    
    
    
    194
    
    
    
    5.42
    
    
    
    12,110
    
    
    
    158
    
    
    
    5.25
    
    
    
    14,124
    
    
    
    177
    
    
    
    5.0738,737
    
    
    
    575
    
    
    
    5.93
    
    
    
    35,165
    
    
    
    519
    
    
    
    5.90
    
    
    
    29,681
    
    
    
    442
    
    
    
    5.97111,424
    
    
    
    1,522
    
    
    
    5.46
    
    
    
    108,433
    
    
    
    1,467
    
    
    
    5.41
    
    
    
    108,071
    
    
    
    1,461
    
    
    
    5.42106,263
    
    
    
    1,927
    
    
    
    7.19
    
    
    
    101,012
    
    
    
    1,805
    
    
    
    7.16
    
    
    
    98,413
    
    
    
    1,736
    
    
    
    7.1617,795
    
    
    
    344
    
    
    
    7.66
    
    
    
    17,334
    
    
    
    329
    
    
    
    7.62
    
    
    
    16,508
    
    
    
    313
    
    
    
    7.6920,883
    
    
    
    406
    
    
    
    7.71
    
    
    
    20,175
    
    
    
    378
    
    
    
    7.53
    
    
    
    20,231
    
    
    
    380
    
    
    
    7.617,523
    
    
    
    146
    
    
    
    7.80
    
    
    
    7,759
    
    
    
    150
    
    
    
    7.74
    
    
    
    7,730
    
    
    
    150
    
    
    
    7.7522,208
    
    
    
    308
    
    
    
    5.53
    
    
    
    19,232
    
    
    
    265
    
    
    
    5.51
    
    
    
    14,406
    
    
    
    196
    
    
    
    5.49174,672
    
    
    
    3,131
    
    
    
    7.12
    
    
    
    165,512
    
    
    
    2,927
    
    
    
    7.09
    
    
    
    157,288
    
    
    
    2,775
    
    
    
    7.15223,356
    
    
    
    4,070
    
    
    
    7.28
    
    
    
    222,096
    
    
    
    4,042
    
    
    
    7.28
    
    
    
    225,909
    
    
    
    4,148
    
    
    
    7.367,299
    
    
    
    122
    
    
    
    6.61
    
    
    
    8,850
    
    
    
    141
    
    
    
    6.42
    
    
    
    8,524
    
    
    
    136
    
    
    
    6.4724,474
    
    
    
    614
    
    
    
    9.96
    
    
    
    24,799
    
    
    
    609
    
    
    
    9.84
    
    
    
    23,540
    
    
    
    566
    
    
    
    9.75255,129
    
    
    
    4,806
    
    
    
    7.52
    
    
    
    255,745
    
    
    
    4,792
    
    
    
    7.50
    
    
    
    257,973
    
    
    
    4,850
    
    
    
    7.55429,801
    
    
    
    7,937
    
    
    
    7.35
    
    
    
    421,257
    
    
    
    7,719
    
    
    
    7.34
    
    
    
    415,261
    
    
    
    7,625
    
    
    
    7.4020,209
    
    
    
    363
    
    
    
    7.14
    
    
    
    17,644
    
    
    
    285
    
    
    
    6.47
    
    
    
    16,748
    
    
    
    255
    
    
    
    6.167,937
    
    
    
    138
    
    
    
    6.91
    
    
    
    7,985
    
    
    
    144
    
    
    
    7.23
    
    
    
    8,255
    
    
    
    139
    
    
    
    6.82628,773
    
    
    
    10,822
    
    
    
    6.86
    
    
    
    605,978
    
    
    
    10,342
    
    
    
    6.84
    
    
    
    593,663
    
    
    
    10,129
    
    
    
    6.87-
    
    
    
    42
    
    
    
    0.02
    
    
    
    -
    
    
    
    46
    
    
    
    0.03
    
    
    
    -
    
    
    
    48
    
    
    
    0.03628,773
    
    
    
    10,864
    
    
    
    6.88
    
    
    
    605,978
    
    
    
    10,388
    
    
    
    6.87
    
    
    
    593,663
    
    
    
    10,177
    
    
    
    6.9011,134
    
    
    
    
    
    
    
    
    
    
    
    11,533
    
    
    
    
    
    
    
    
    
    
    
    12,26089,097
    
    
    
    
    
    
    
    
    
    
    
    87,262
    
    
    
    
    
    
    
    
    
    
    
    85,106$
    729,004
    
    
    
    
    
    
    
    
    
    
    $
    704,773
    
    
    
    
    
    
    
    
    
    
    $
    691,02981,851
    
    
    
    357
    
    
    
    1.73
    
    
    
    83,977
    
    
    
    367
    
    
    
    1.75
    
    
    
    84,247
    
    
    
    373
    
    
    
    1.80116,404
    
    
    
    980
    
    
    
    3.34
    
    
    
    111,562
    
    
    
    976
    
    
    
    3.51
    
    
    
    107,785
    
    
    
    917
    
    
    
    3.45122,474
    
    
    
    1,507
    
    
    
    4.88
    
    
    
    120,684
    
    
    
    1,455
    
    
    
    4.84
    
    
    
    116,262
    
    
    
    1,369
    
    
    
    4.7723,322
    
    
    
    292
    
    
    
    4.97
    
    
    
    21,871
    
    
    
    270
    
    
    
    4.96
    
    
    
    20,802
    
    
    
    249
    
    
    
    4.8513,776
    
    
    
    187
    
    
    
    5.40
    
    
    
    8,051
    
    
    
    107
    
    
    
    5.30
    
    
    
    9,034
    
    
    
    119
    
    
    
    5.36357,827
    
    
    
    3,323
    
    
    
    3.68
    
    
    
    346,145
    
    
    
    3,175
    
    
    
    3.68
    
    
    
    338,130
    
    
    
    3,027
    
    
    
    3.6344,334
    
    
    
    556
    
    
    
    4.98
    
    
    
    38,031
    
    
    
    473
    
    
    
    4.98
    
    
    
    35,142
    
    
    
    430
    
    
    
    4.975,799
    
    
    
    65
    
    
    
    4.42
    
    
    
    5,143
    
    
    
    60
    
    
    
    4.67
    
    
    
    4,920
    
    
    
    57
    
    
    
    4.727,420
    
    
    
    70
    
    
    
    3.74
    
    
    
    7,158
    
    
    
    67
    
    
    
    3.75
    
    
    
    8,709
    
    
    
    83
    
    
    
    3.867,793
    
    
    
    55
    
    
    
    2.74
    
    
    
    7,688
    
    
    
    52
    
    
    
    2.77
    
    
    
    6,898
    
    
    
    44
    
    
    
    2.54151,226
    
    
    
    2,067
    
    
    
    5.44
    
    
    
    143,504
    
    
    
    1,923
    
    
    
    5.37
    
    
    
    141,979
    
    
    
    1,880
    
    
    
    5.35574,399
    
    
    
    6,136
    
    
    
    4.24
    
    
    
    547,669
    
    
    
    5,750
    
    
    
    4.21
    
    
    
    535,778
    
    
    
    5,521
    
    
    
    4.17-
    
    
    
    144
    
    
    
    0.10
    
    
    
    -
    
    
    
    151
    
    
    
    0.11
    
    
    
    -
    
    
    
    119
    
    
    
    0.09574,399
    
    
    
    6,280
    
    
    
    4.34
    
    
    
    547,669
    
    
    
    5,901
    
    
    
    4.32
    
    
    
    535,778
    
    
    
    5,640
    
    
    
    4.2658,280
    
    
    
    
    
    
    
    
    
    
    
    62,273
    
    
    
    
    
    
    
    
    
    
    
    60,97626,468
    
    
    
    
    
    
    
    
    
    
    
    25,514
    
    
    
    
    
    
    
    
    
    
    
    24,95569,857
    
    
    
    
    
    
    
    
    
    
    
    69,317
    
    
    
    
    
    
    
    
    
    
    
    69,320$
    729,004
    
    
    
    
    
    
    
    
    
    
    $
    704,773
    
    
    
    
    
    
    
    
    
    
    $
    691,029$
    10,864
    
    
    
    6.88
    %
    
    
    
    
    
    $
    10,388
    
    
    
    6.87
    %
    
    
    
    
    
    $
    10,177
    
    
    
    6.90
    %6,280
    
    
    
    3.96
    
    
    
    
    
    
    
    5,901
    
    
    
    3.91
    
    
    
    
    
    
    
    5,640
    
    
    
    3.84$
    4,584
    
    
    
    2.92
    %
    
    
    
    
    
    $
    4,487
    
    
    
    2.96
    %
    
    
    
    
    
    $
    4,537
    
    
    
    3.06
    %
  61




---



##### 



WACHOVIA CORPORATION AND SUBSIDIARIES  CONSOLIDATED BALANCE SHEETS
 2008
    
    
    2007First
    
    
    Fourth
    
    
    Third
    
    
    Second
    
    
    First(In millions, except per share data)
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    QuarterASSETSCash and due from banks
    
    $
    14,703
    
    
    
    15,124
    
    
    
    12,681
    
    
    
    12,065
    
    
    
    12,593Interest-bearing bank balances
    
    
    3,236
    
    
    
    3,057
    
    
    
    4,449
    
    
    
    2,726
    
    
    
    2,591Federal funds sold and securities purchased under
resale agreements
    
    
    10,644
    
    
    
    15,449
    
    
    
    11,995
    
    
    
    11,511
    
    
    
    10,322Total cash and cash equivalents
    
    
    28,583
    
    
    
    33,630
    
    
    
    29,125
    
    
    
    26,302
    
    
    
    25,506Trading account assets
    
    
    72,592
    
    
    
    55,882
    
    
    
    54,835
    
    
    
    51,540
    
    
    
    44,161Securities
    
    
    114,183
    
    
    
    115,037
    
    
    
    111,827
    
    
    
    106,184
    
    
    
    106,841Loans, net of unearned income
    
    
    480,482
    
    
    
    461,954
    
    
    
    449,206
    
    
    
    429,120
    
    
    
    421,663Allowance for loan losses
    
    
    (6,567
    )
    
    
    (4,507
    )
    
    
    (3,505
    )
    
    
    (3,390
    )
    
    
    (3,378
    )Loans, net
    
    
    473,915
    
    
    
    457,447
    
    
    
    445,701
    
    
    
    425,730
    
    
    
    418,285Loans held for sale
    
    
    11,429
    
    
    
    16,772
    
    
    
    21,431
    
    
    
    17,733
    
    
    
    15,032Premises and equipment
    
    
    6,733
    
    
    
    6,605
    
    
    
    6,002
    
    
    
    6,080
    
    
    
    6,058Due from customers on acceptances
    
    
    1,109
    
    
    
    1,418
    
    
    
    1,295
    
    
    
    831
    
    
    
    992Goodwill
    
    
    43,068
    
    
    
    43,122
    
    
    
    38,848
    
    
    
    38,766
    
    
    
    38,838Other intangible assets
    
    
    2,038
    
    
    
    2,119
    
    
    
    1,380
    
    
    
    1,468
    
    
    
    1,570Other assets
    
    
    54,925
    
    
    
    50,864
    
    
    
    43,724
    
    
    
    40,794
    
    
    
    45,386Total assets
    
    $
    808,575
    
    
    
    782,896
    
    
    
    754,168
    
    
    
    715,428
    
    
    
    702,669LIABILITIES AND STOCKHOLDERS EQUITYDepositsNoninterest-bearing deposits
    
    
    60,951
    
    
    
    60,893
    
    
    
    56,825
    
    
    
    62,112
    
    
    
    63,399Interest-bearing deposits
    
    
    384,013
    
    
    
    388,236
    
    
    
    365,112
    
    
    
    347,918
    
    
    
    341,871Total deposits
    
    
    444,964
    
    
    
    449,129
    
    
    
    421,937
    
    
    
    410,030
    
    
    
    405,270Short-term borrowings
    
    
    57,857
    
    
    
    50,393
    
    
    
    62,714
    
    
    
    52,715
    
    
    
    47,144Bank acceptances outstanding
    
    
    1,118
    
    
    
    1,424
    
    
    
    1,303
    
    
    
    840
    
    
    
    1,004Trading account liabilities
    
    
    28,887
    
    
    
    21,585
    
    
    
    17,771
    
    
    
    19,319
    
    
    
    17,291Other liabilities
    
    
    19,036
    
    
    
    19,151
    
    
    
    18,424
    
    
    
    18,080
    
    
    
    16,741Long-term debt
    
    
    175,653
    
    
    
    161,007
    
    
    
    158,584
    
    
    
    142,047
    
    
    
    142,334Total liabilities
    
    
    727,515
    
    
    
    702,689
    
    
    
    680,733
    
    
    
    643,031
    
    
    
    629,784Minority interest in net assets of consolidated subsidiaries
    
    
    3,068
    
    
    
    3,335
    
    
    
    3,295
    
    
    
    3,131
    
    
    
    3,099STOCKHOLDERS EQUITYPreferred stock, Class A, 40 million shares, no par value;
10 million shares, no par value; none issued
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    -Dividend Equalization Preferred shares, no par value,
97 million shares issued and outstanding at March 31, 2008
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    -Non-Cumulative Perpetual Class A Preferred Stock, Series I,
$100,000 liquidation preference per share,
25,010 shares authorized
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    -Non-Cumulative Perpetual Class A Preferred Stock, Series J,
$1,000 liquidation preference per share, 92 million
depositary shares issued and outstanding at March 31, 2008
    
    
    2,300
    
    
    
    2,300
    
    
    
    -
    
    
    
    -
    
    
    
    -Non-Cumulative Perpetual Class A Preferred Stock, Series K,
$1,000 liquidation preference per share, 3.5 million
shares issued and outstanding at March 31, 2008
    
    
    3,500
    
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    -Common stock, $3.33-1/3 par value; authorized 3 billion
shares, outstanding 1.965 billion shares at March 31, 2008
    
    
    6,551
    
    
    
    6,534
    
    
    
    6,283
    
    
    
    6,289
    
    
    
    6,316Paid-in capital
    
    
    56,367
    
    
    
    56,149
    
    
    
    51,938
    
    
    
    51,905
    
    
    
    52,026Retained earnings
    
    
    11,449
    
    
    
    13,456
    
    
    
    14,670
    
    
    
    14,335
    
    
    
    13,378Accumulated other comprehensive income, net
    
    
    (2,175
    )
    
    
    (1,567
    )
    
    
    (2,751
    )
    
    
    (3,263
    )
    
    
    (1,934
    )Total stockholders equity
    
    
    77,992
    
    
    
    76,872
    
    
    
    70,140
    
    
    
    69,266
    
    
    
    69,786Total liabilities and stockholders equity
    
    $
    808,575
    
    
    
    782,896
    
    
    
    754,168
    
    
    
    715,428
    
    
    
    702,669
 62




---



##### 



WACHOVIA CORPORATION AND SUBSIDIARIES  CONSOLIDATED STATEMENTS OF INCOME
 2008
    
    
    2007First
    
    
    Fourth
    
    
    Third
    
    
    Second
    
    
    First(In millions, except per share data)
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    QuarterINTEREST INCOMEInterest and fees on loans
    
    $
    7,577
    
    
    
    7,980
    
    
    
    7,937
    
    
    
    7,723
    
    
    
    7,618Interest and dividends on securities
    
    
    1,496
    
    
    
    1,616
    
    
    
    1,529
    
    
    
    1,474
    
    
    
    1,478Trading account interest
    
    
    571
    
    
    
    557
    
    
    
    566
    
    
    
    506
    
    
    
    433Other interest income
    
    
    535
    
    
    
    757
    
    
    
    799
    
    
    
    647
    
    
    
    611Total interest income
    
    
    10,179
    
    
    
    10,910
    
    
    
    10,831
    
    
    
    10,350
    
    
    
    10,140INTEREST EXPENSEInterest on deposits
    
    
    2,941
    
    
    
    3,433
    
    
    
    3,334
    
    
    
    3,180
    
    
    
    3,014Interest on short-term borrowings
    
    
    523
    
    
    
    673
    
    
    
    801
    
    
    
    706
    
    
    
    669Interest on long-term debt
    
    
    1,963
    
    
    
    2,174
    
    
    
    2,145
    
    
    
    2,015
    
    
    
    1,957Total interest expense
    
    
    5,427
    
    
    
    6,280
    
    
    
    6,280
    
    
    
    5,901
    
    
    
    5,640Net interest income
    
    
    4,752
    
    
    
    4,630
    
    
    
    4,551
    
    
    
    4,449
    
    
    
    4,500Provision for credit losses
    
    
    2,831
    
    
    
    1,497
    
    
    
    408
    
    
    
    179
    
    
    
    177Net interest income after provision for credit losses
    
    
    1,921
    
    
    
    3,133
    
    
    
    4,143
    
    
    
    4,270
    
    
    
    4,323FEE AND OTHER INCOMEService charges
    
    
    676
    
    
    
    716
    
    
    
    689
    
    
    
    667
    
    
    
    614Other banking fees
    
    
    498
    
    
    
    497
    
    
    
    471
    
    
    
    449
    
    
    
    416Commissions
    
    
    914
    
    
    
    970
    
    
    
    600
    
    
    
    649
    
    
    
    659Fiduciary and asset management fees
    
    
    1,439
    
    
    
    1,436
    
    
    
    1,029
    
    
    
    1,015
    
    
    
    953Advisory, underwriting and other investment banking fees
    
    
    261
    
    
    
    249
    
    
    
    393
    
    
    
    454
    
    
    
    407Trading account profits (losses)
    
    
    (308
    )
    
    
    (524
    )
    
    
    (301
    )
    
    
    195
    
    
    
    128Principal investing
    
    
    446
    
    
    
    41
    
    
    
    372
    
    
    
    298
    
    
    
    48Securities gains (losses)
    
    
    (205
    )
    
    
    (320
    )
    
    
    (34
    )
    
    
    23
    
    
    
    53Other income
    
    
    (944
    )
    
    
    (321
    )
    
    
    (286
    )
    
    
    490
    
    
    
    456Total fee and other income
    
    
    2,777
    
    
    
    2,744
    
    
    
    2,933
    
    
    
    4,240
    
    
    
    3,734NONINTEREST EXPENSESalaries and employee benefits
    
    
    3,260
    
    
    
    3,468
    
    
    
    2,628
    
    
    
    3,122
    
    
    
    2,972Occupancy
    
    
    379
    
    
    
    375
    
    
    
    325
    
    
    
    331
    
    
    
    312Equipment
    
    
    323
    
    
    
    334
    
    
    
    283
    
    
    
    309
    
    
    
    307Marketing
    
    
    97
    
    
    
    80
    
    
    
    74
    
    
    
    78
    
    
    
    62Communications and supplies
    
    
    186
    
    
    
    191
    
    
    
    176
    
    
    
    178
    
    
    
    173Professional and consulting fees
    
    
    196
    
    
    
    271
    
    
    
    194
    
    
    
    205
    
    
    
    177Other intangible amortization
    
    
    103
    
    
    
    111
    
    
    
    92
    
    
    
    103
    
    
    
    118Merger-related and restructuring expenses
    
    
    241
    
    
    
    187
    
    
    
    36
    
    
    
    32
    
    
    
    10Sundry expense
    
    
    656
    
    
    
    769
    
    
    
    717
    
    
    
    532
    
    
    
    490Total noninterest expense
    
    
    5,441
    
    
    
    5,786
    
    
    
    4,525
    
    
    
    4,890
    
    
    
    4,621Minority interest in income of consolidated subsidiaries
    
    
    155
    
    
    
    107
    
    
    
    189
    
    
    
    139
    
    
    
    136Income (loss) from continuing operations before income taxes (benefits)
    
    
    (898
    )
    
    
    (16
    )
    
    
    2,362
    
    
    
    3,481
    
    
    
    3,300Income taxes (benefits)
    
    
    (234
    )
    
    
    (209
    )
    
    
    656
    
    
    
    1,140
    
    
    
    998Income (loss) from continuing operations
    
    
    (664
    )
    
    
    193
    
    
    
    1,706
    
    
    
    2,341
    
    
    
    2,302Discontinued operations, net of income taxes
    
    
    -
    
    
    
    (142
    )
    
    
    (88
    )
    
    
    -
    
    
    
    -Net income (loss)
    
    
    (664
    )
    
    
    51
    
    
    
    1,618
    
    
    
    2,341
    
    
    
    2,302Dividends on preferred stock
    
    
    43
    
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    -Net income (loss) available to common stockholders
    
    $
    (707
    )

    
    
    51
    
    
    
    1,618
    
    
    
    2,341
    
    
    
    2,302PER COMMON SHARE DATA (after preferred stock dividends)Basic earningsIncome (loss) from continuing operations
    
    $
    (0.36
    )
    
    
    0.10
    
    
    
    0.91
    
    
    
    1.24
    
    
    
    1.22Net income (loss) available to common stockholders
    
    
    (0.36
    )
    
    
    0.03
    
    
    
    0.86
    
    
    
    1.24
    
    
    
    1.22Diluted earnings (a)Income (loss) from continuing operations
    
    
    (0.36
    )
    
    
    0.10
    
    
    
    0.90
    
    
    
    1.22
    
    
    
    1.20Net income (loss) available to common stockholders
    
    
    (0.36
    )
    
    
    0.03
    
    
    
    0.85
    
    
    
    1.22
    
    
    
    1.20Cash dividends
    
    $
    0.64
    
    
    
    0.64
    
    
    
    0.64
    
    
    
    0.56
    
    
    
    0.56AVERAGE COMMON SHARESBasic
    
    
    1,963
    
    
    
    1,959
    
    
    
    1,885
    
    
    
    1,891
    
    
    
    1,894Diluted
    
    
    1,977
    
    
    
    1,983
    
    
    
    1,910
    
    
    
    1,919
    
    
    
    1,925
 (a)
    
    Calculated using average basic common shares in the first quarter of 2008. 63




---



##### 



WACHOVIA CORPORATION AND SUBSIDIARIES  CONSOLIDATED FINANCIAL STATEMENTS
 Consolidated Balance Sheets  March 31, 2008 and December 31, 2007 (Unaudited)
    
    
    65Consolidated Statements of Income  Three Months Ended March 31, 2008 and 2007 (Unaudited)
    
    
    66Consolidated Statements of Cash Flows  Three Months Ended March 31, 2008 and 2007 (Unaudited)
    
    
    67Notes to Consolidated Financial Statements (Unaudited)Note 1: Summary of Significant Accounting Policies and Other Matters
    
    
    68Note 2: Securities
    
    
    70Note 3: Variable Interest Entities and Servicing Assets
    
    
    72Note 4: Share-Based Payments
    
    
    74Note 5: Comprehensive Income
    
    
    76Note 6: Business Segments
    
    
    77Note 7: Basic and Diluted Earnings Per Common Share
    
    
    79Note 8: Income Taxes
    
    
    80Note 9: Derivatives
    
    
    81Note 10: Guarantees
    
    
    86Note 11: Fair Value Measurements and Fair Value Option
    
    
    87
 64




---



##### 



WACHOVIA CORPORATION AND SUBSIDIARIES  CONSOLIDATED BALANCE SHEETS (Unaudited)
 March 31,
    
    
    December 31,(In millions, except per share data)
    
    2008
    
    
    2007ASSETSCash and due from banks
    
    $
    14,703
    
    
    
    15,124Interest-bearing bank balances
    
    
    3,236
    
    
    
    3,057Federal funds sold and securities purchased under
resale agreements
    
    
    10,644
    
    
    
    15,449Total cash and cash equivalents
    
    
    28,583
    
    
    
    33,630Trading account assets
    
    
    72,592
    
    
    
    55,882Securities
    
    
    114,183
    
    
    
    115,037Loans, net of unearned income
    
    
    480,482
    
    
    
    461,954Allowance for loan losses
    
    
    (6,567
    )
    
    
    (4,507
    )Loans, net
    
    
    473,915
    
    
    
    457,447Loans held for sale (includes $3,652 at fair value at March 31, 2008)
    
    
    11,429
    
    
    
    16,772Premises and equipment
    
    
    6,733
    
    
    
    6,605Due from customers on acceptances
    
    
    1,109
    
    
    
    1,418Goodwill
    
    
    43,068
    
    
    
    43,122Other intangible assets
    
    
    2,038
    
    
    
    2,119Other assets
    
    
    54,925
    
    
    
    50,864Total assets
    
    $
    808,575
    
    
    
    782,896LIABILITIES AND STOCKHOLDERS EQUITYDepositsNoninterest-bearing deposits
    
    
    60,951
    
    
    
    60,893Interest-bearing deposits
    
    
    384,013
    
    
    
    388,236Total deposits
    
    
    444,964
    
    
    
    449,129Short-term borrowings
    
    
    57,857
    
    
    
    50,393Bank acceptances outstanding
    
    
    1,118
    
    
    
    1,424Trading account liabilities
    
    
    28,887
    
    
    
    21,585Other liabilities
    
    
    19,036
    
    
    
    19,151Long-term debt
    
    
    175,653
    
    
    
    161,007Total liabilities
    
    
    727,515
    
    
    
    702,689Minority interest in net assets of consolidated subsidiaries
    
    
    3,068
    
    
    
    3,335STOCKHOLDERS EQUITYPreferred stock, Class A, 40 million shares, no par value;
10 million shares, no par value; none issued
    
    
    -
    
    
    
    -Dividend Equalization Preferred shares, no par value,
97 million shares issued and outstanding at March 31, 2008
    
    
    -
    
    
    
    -Non-Cumulative Perpetual Class A Preferred Stock, Series I,
$100,000 liquidation preference per share, 25,010 shares authorized
    
    
    -
    
    
    
    -Non-Cumulative Perpetual Class A Preferred Stock, Series J,
$1,000 liquidation preference per share, 92 million
depositary shares issued and outstanding at March 31, 2008
    
    
    2,300
    
    
    
    2,300Non-Cumulative Perpetual Class A Preferred Stock, Series K,
$1,000 liquidation preference per share, 3.5 million
shares issued and outstanding at March 31, 2008
    
    
    3,500
    
    
    
    -Common stock, $3.33-1/3 par value; authorized 3 billion
shares, outstanding 1.965 billion shares at March 31, 2008
    
    
    6,551
    
    
    
    6,534Paid-in capital
    
    
    56,367
    
    
    
    56,149Retained earnings
    
    
    11,449
    
    
    
    13,456Accumulated other comprehensive income, net
    
    
    (2,175
    )
    
    
    (1,567
    )Total stockholders equity
    
    
    77,992
    
    
    
    76,872Total liabilities and stockholders equity
    
    $
    808,575
    
    
    
    782,896
  65




---



##### 



WACHOVIA CORPORATION AND SUBSIDIARIES  CONSOLIDATED STATEMENTS OF INCOME (Unaudited)
 Three Months EndedMarch 31,(In millions, except per share data)
    
    2008
    
    
    2007INTEREST INCOMEInterest and fees on loans
    
    $
    7,577
    
    
    
    7,618Interest and dividends on securities
    
    
    1,496
    
    
    
    1,478Trading account interest
    
    
    571
    
    
    
    433Other interest income
    
    
    535
    
    
    
    611Total interest income
    
    
    10,179
    
    
    
    10,140INTEREST EXPENSEInterest on deposits
    
    
    2,941
    
    
    
    3,014Interest on short-term borrowings
    
    
    523
    
    
    
    669Interest on long-term debt
    
    
    1,963
    
    
    
    1,957Total interest expense
    
    
    5,427
    
    
    
    5,640Net interest income
    
    
    4,752
    
    
    
    4,500Provision for credit losses
    
    
    2,831
    
    
    
    177Net interest income after provision for credit losses
    
    
    1,921
    
    
    
    4,323FEE AND OTHER INCOMEService charges
    
    
    676
    
    
    
    614Other banking fees
    
    
    498
    
    
    
    416Commissions
    
    
    914
    
    
    
    659Fiduciary and asset management fees
    
    
    1,439
    
    
    
    953Advisory, underwriting and other investment banking fees
    
    
    261
    
    
    
    407Trading account profits (losses)
    
    
    (308
    )
    
    
    128Principal investing
    
    
    446
    
    
    
    48Securities gains (losses)
    
    
    (205
    )
    
    
    53Other income
    
    
    (944
    )
    
    
    456Total fee and other income
    
    
    2,777
    
    
    
    3,734NONINTEREST EXPENSESalaries and employee benefits
    
    
    3,260
    
    
    
    2,972Occupancy
    
    
    379
    
    
    
    312Equipment
    
    
    323
    
    
    
    307Marketing
    
    
    97
    
    
    
    62Communications and supplies
    
    
    186
    
    
    
    173Professional and consulting fees
    
    
    196
    
    
    
    177Other intangible amortization
    
    
    103
    
    
    
    118Merger-related and restructuring expenses
    
    
    241
    
    
    
    10Sundry expense
    
    
    656
    
    
    
    490Total noninterest expense
    
    
    5,441
    
    
    
    4,621Minority interest in income of consolidated subsidiaries
    
    
    155
    
    
    
    136Income (loss) before income taxes (benefits)
    
    
    (898
    )
    
    
    3,300Income taxes (benefits)
    
    
    (234
    )
    
    
    998Net income (loss)
    
    
    (664
    )
    
    
    2,302Dividends on preferred stock
    
    
    43
    
    
    
    -Net income (loss) available to common stockholders
    
    $
    (707
    )
    
    
    2,302PER COMMON SHARE DATA (after preferred stock dividends)Basic earningsNet income (loss) available to common stockholders
    
    $
    (0.36
    )
    
    
    1.22Diluted earningsNet income (loss) available to common stockholders
    
    
    (0.36
    )
    
    
    1.20Cash dividends
    
    $
    0.64
    
    
    
    0.56AVERAGE COMMON SHARESBasic
    
    
    1,963
    
    
    
    1,894Diluted
    
    
    1,977
    
    
    
    1,925
  66




---



##### 



WACHOVIA CORPORATION AND SUBSIDIARIES  CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
 Three Months EndedMarch 31,(In millions)
    
    2008
    
    
    2007OPERATING ACTIVITIESNet income (loss)
    
    $
    (664
    )
    
    
    2,302Adjustments to reconcile net income to net cash provided (used) by operating
activitiesAccretion and amortization of securities discounts and premiums, net
    
    
    2
    
    
    
    (5
    )Provision for credit losses
    
    
    2,831
    
    
    
    177Gain on securitization transactions
    
    
    (13
    )
    
    
    (69
    )Gain on sale of mortgage servicing rights
    
    
    -
    
    
    
    (2
    )Securities transactions
    
    
    205
    
    
    
    (53
    )Depreciation and other amortization
    
    
    583
    
    
    
    534Trading account assets, net
    
    
    (9,903
    )
    
    
    580Loss on sales of premises and equipment
    
    
    (5
    )
    
    
    1Valuation losses on bank-owned separate account life insurance
    
    
    314
    
    
    
    -Contribution to qualified pension plan
    
    
    -
    
    
    
    (270
    )Income tax
shortfall (excess income tax benefit) from share-based payment arrangements
    
    
    18
    
    
    
    (8
    )Loans held for sale, net
    
    
    (3,307
    )
    
    
    (2,644
    )Deferred interest on certain loans
    
    
    (438
    )
    
    
    (378
    )Other assets, net
    
    
    (3,626
    )
    
    
    (3,560
    )Trading account liabilities, net
    
    
    7,302
    
    
    
    (937
    )Other liabilities, net
    
    
    (627
    )
    
    
    (3,378
    )Net cash used by operating activities
    
    
    (7,328
    )
    
    
    (7,710
    )INVESTING ACTIVITIESIncrease (decrease) in cash realized fromSales of securities
    
    
    8,209
    
    
    
    2,136Maturities of securities
    
    
    4,529
    
    
    
    4,468Purchases of securities
    
    
    (18,099
    )
    
    
    (4,108
    )Origination of loans, net
    
    
    (12,031
    )
    
    
    (1,535
    )Sales of premises and equipment
    
    
    19
    
    
    
    107Purchases of premises and equipment
    
    
    (396
    )
    
    
    (235
    )Goodwill and other intangible assets
    
    
    32
    
    
    
    (512
    )Purchase of bank-owned separate account life insurance, net
    
    
    (90
    )
    
    
    (397
    )Net cash used by investing activities
    
    
    (17,827
    )
    
    
    (76
    )FINANCING ACTIVITIESIncrease (decrease) in cash realized fromIncrease (decrease) in deposits, net
    
    
    (4,165
    )
    
    
    (2,188
    )Securities sold under repurchase agreements and other short-term borrowings, net
    
    
    7,464
    
    
    
    (2,013
    )Issuances of long-term debt
    
    
    23,719
    
    
    
    12,430Payments of long-term debt
    
    
    (9,073
    )
    
    
    (8,690
    )Issuances of preferred shares
    
    
    3,497
    
    
    
    -Issuances of common stock, net
    
    
    21
    
    
    
    184Purchases of common stock
    
    
    (20
    )
    
    
    (284
    )(Income tax
shortfall) excess income tax benefit from share-based payment arrangements
    
    
    (18
    )
    
    
    8Cash dividends paid
    
    
    (1,317
    )
    
    
    (1,071
    )Net cash provided (used) by financing activities
    
    
    20,108
    
    
    
    (1,624
    )Decrease in cash and cash equivalents
    
    
    (5,047
    )
    
    
    (9,410
    )Cash and cash equivalents, beginning of year
    
    
    33,630
    
    
    
    34,916Cash and cash equivalents, end of period
    
    $
    28,583
    
    
    
    25,506NONCASH ITEMSTransfer to securities from loans resulting from securitizations
    
    $
    -
    
    
    
    499Transfer to securities from loans held for sale resulting from securitizations
    
    
    1,849
    
    
    
    -Transfer to trading account assets from securities
    
    
    6,807
    
    
    
    -Transfer to loans from loans held for sale
    
    
    6,801
    
    
    
    180Cumulative effect of accounting changes, net of income taxes
    
    $
    (24
    )
    
    
    (1,447
    )
  67




---



##### 



WACHOVIA CORPORATION AND SUBSIDIARIES  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
 
 NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND OTHER MATTERS
 GENERAL
    PERSONNEL EXPENSE AND RETIREMENT BENEFITS
   OtherPostretirementQualified Pension
    
    
    Nonqualified Pension
    
    
    BenefitsThree Months Ended
    
    
    Three Months Ended
    
    
    Three Months EndedMarch 31,
    
    
    March 31,
    
    
    March 31,(In millions)
    
    2008
    
    
    2007
    
    
    2008
    
    
    2007
    
    
    2008
    
    
    2007RETIREMENT BENEFIT COSTS (CREDIT)Service cost
    
    $
    43
    
    
    
    46
    
    
    
    -
    
    
    
    1
    
    
    
    1
    
    
    
    1Interest cost
    
    
    64
    
    
    
    66
    
    
    
    5
    
    
    
    5
    
    
    
    11
    
    
    
    11Expected return on plan assets
    
    
    (130
    )
    
    
    (123
    )
    
    
    -
    
    
    
    -
    
    
    
    (1
    )
    
    
    (1
    )Amortization of prior service cost
    
    
    (11
    )
    
    
    (7
    )
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    (2
    )Amortization of actuarial losses
    
    
    19
    
    
    
    30
    
    
    
    1
    
    
    
    2
    
    
    
    -
    
    
    
    -Net retirement benefit costs (credit)
    
    $
    (15
    )
    
    
    12
    
    
    
    6
    
    
    
    8
    
    
    
    11
    
    
    
    9
 DISCONTINUED
OPERATIONS
   68




---



##### 



GOODWILL
    OTHER
INCOME
  PREFERRED STOCK
  NEW ACCOUNTING PRONOUNCEMENTS
   RECLASSIFICATIONS
  SUBSEQUENT EVENT
  OTHER MATTERS
  69




---



##### 



NOTE 2: SECURITIES
 March 31, 2008Average1 Year
    
    
    1-5
    
    
    5-10
    
    
    After 10
    
    
    
    
    
    
    Gross Unrealized
    
    
    Amortized
    
    
    Maturity(In millions)
    
    or Less
    
    
    Years
    
    
    Years
    
    
    Years
    
    
    Total
    
    
    Gains
    
    
    Losses
    
    
    Cost
    
    
    in YearsMARKET VALUEU.S. Treasury
    
    $
    268
    
    
    
    183
    
    
    
    173
    
    
    
    42
    
    
    
    666
    
    
    
    24
    
    
    
    -
    
    
    
    642
    
    
    
    3.47Mortgage-backed securities
    
    
    557
    
    
    
    33,734
    
    
    
    29,934
    
    
    
    27
    
    
    
    64,252
    
    
    
    700
    
    
    
    208
    
    
    
    63,760
    
    
    
    4.78Asset-backedResidual interests
from securitizations
    
    
    41
    
    
    
    133
    
    
    
    180
    
    
    
    118
    
    
    
    472
    
    
    
    130
    
    
    
    22
    
    
    
    364
    
    
    
    3.04Retained bonds
from securitizations
    
    
    1,546
    
    
    
    187
    
    
    
    70
    
    
    
    -
    
    
    
    1,803
    
    
    
    2
    
    
    
    50
    
    
    
    1,851
    
    
    
    1.34Collateralized mortgage
obligations
    
    
    685
    
    
    
    18,147
    
    
    
    1,428
    
    
    
    6
    
    
    
    20,266
    
    
    
    118
    
    
    
    1,343
    
    
    
    21,491
    
    
    
    2.88Commercial mortgage-backed
    
    
    624
    
    
    
    776
    
    
    
    1,240
    
    
    
    26
    
    
    
    2,666
    
    
    
    40
    
    
    
    123
    
    
    
    2,749
    
    
    
    4.40Other
    
    
    1,387
    
    
    
    3,148
    
    
    
    257
    
    
    
    5
    
    
    
    4,797
    
    
    
    161
    
    
    
    685
    
    
    
    5,321
    
    
    
    2.38State, county and municipal
    
    
    62
    
    
    
    615
    
    
    
    635
    
    
    
    2,398
    
    
    
    3,710
    
    
    
    121
    
    
    
    61
    
    
    
    3,650
    
    
    
    13.74Sundry
    
    
    787
    
    
    
    2,057
    
    
    
    5,610
    
    
    
    7,097
    
    
    
    15,551
    
    
    
    122
    
    
    
    1,266
    
    
    
    16,695
    
    
    
    9.26Total market value
    
    $
    5,957
    
    
    
    58,980
    
    
    
    39,527
    
    
    
    9,719
    
    
    
    114,183
    
    
    
    1,418
    
    
    
    3,758
    
    
    
    116,523
    
    
    
    5.10MARKET VALUEDebt securities
    
    $
    5,957
    
    
    
    58,980
    
    
    
    39,527
    
    
    
    7,835
    
    
    
    112,299
    
    
    
    1,309
    
    
    
    3,517
    
    
    
    114,507Equity securities
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    1,884
    
    
    
    1,884
    
    
    
    109
    
    
    
    241
    
    
    
    2,016Total market value
    
    $
    5,957
    
    
    
    58,980
    
    
    
    39,527
    
    
    
    9,719
    
    
    
    114,183
    
    
    
    1,418
    
    
    
    3,758
    
    
    
    116,523AMORTIZED COSTDebt securities
    
    $
    6,066
    
    
    
    60,089
    
    
    
    40,238
    
    
    
    8,114
    
    
    
    114,507Equity securities
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    2,016
    
    
    
    2,016Total amortized cost
    
    $
    6,066
    
    
    
    60,089
    
    
    
    40,238
    
    
    
    10,130
    
    
    
    116,523WEIGHTED AVERAGE YIELDU.S. Treasury
    
    
    1.40
    %
    
    
    2.00
    
    
    
    2.75
    
    
    
    4.95
    
    
    
    2.12Mortgage-backed securities
    
    
    2.66
    
    
    
    5.55
    
    
    
    5.22
    
    
    
    5.20
    
    
    
    5.37Asset-backedResidual interests
from securitizations
    
    
    54.69
    
    
    
    19.13
    
    
    
    27.14
    
    
    
    53.32
    
    
    
    30.78Retained bonds
from securitizations
    
    
    5.04
    
    
    
    6.08
    
    
    
    8.43
    
    
    
    -
    
    
    
    5.33Collateralized mortgage
obligations
    
    
    6.00
    
    
    
    6.14
    
    
    
    6.30
    
    
    
    5.45
    
    
    
    6.15Commercial mortgage-backed
    
    
    7.06
    
    
    
    7.88
    
    
    
    4.98
    
    
    
    11.31
    
    
    
    6.34Other
    
    
    5.66
    
    
    
    5.66
    
    
    
    6.22
    
    
    
    30.43
    
    
    
    5.71State, county and municipal
    
    
    9.55
    
    
    
    7.55
    
    
    
    6.70
    
    
    
    6.41
    
    
    
    6.69Sundry
    
    
    3.37
    
    
    
    5.04
    
    
    
    4.96
    
    
    
    5.23
    
    
    
    5.02Consolidated
    
    
    5.25
    %
    
    
    5.80
    
    
    
    5.31
    
    
    
    5.80
    
    
    
    5.60
 70




---



##### 



Three Months EndedMarch 31,(In millions)
    
    2008
    
    
    2007Debt securities
    
    $Gross gains
    
    
    49
    
    
    
    38Gross losses (a)
    
    
    (379
    )
    
    
    (7
    )Net gains (losses) on sales of debt securities
    
    
    (330
    )
    
    
    31Equity securitiesGross gains
    
    
    235
    
    
    
    22Gross losses (b)
    
    
    (110
    )
    
    
    -Net gains on sales of equity securities
    
    
    125
    
    
    
    22Total securities gains (losses)
    
    $
    (205
    )
    
    
    53
 
 71




---



##### 



NOTE 3: VARIABLE INTEREST ENTITIES AND SERVICING ASSETS
 VARIABLE INTEREST ENTITIES
    
     72




---



##### 



Three Months Ended March 31, 2008Fair Value
    
    
    Amortized CostFixed RateOriginated
    
    
    CommercialResidential
    
    
    Mortgage-(In millions)
    
    Mortgages
    
    
    Backed
    
    
    Other
    
    
    TotalBalance, December 31, 2007
    
    $
    437
    
    
    
    771
    
    
    
    240
    
    
    
    1,448Fair value of servicing assets purchased, assumed or
originated, or retained from securitizations
    
    
    56
    
    
    
    -
    
    
    
    21
    
    
    
    77Servicing sold or otherwise disposed of
    
    
    (1
    )
    
    
    -
    
    
    
    -
    
    
    
    (1
    )Change in fair value due to changes in model inputs
and/or assumptions
    
    
    (29
    )
    
    
    -
    
    
    
    -
    
    
    
    (29
    )Other changes in fair value, primarily from fees earned
    
    
    (23
    )
    
    
    -
    
    
    
    -
    
    
    
    (23
    )Amortization of servicing assets
    
    
    -
    
    
    
    (36
    )
    
    
    (13
    )
    
    
    (49
    )Impairment
    
    
    -
    
    
    
    (2
    )
    
    
    -
    
    
    
    (2
    )Balance, March 31, 2008
    
    $
    440
    
    
    
    733
    
    
    
    248
    
    
    
    1,421FAIR VALUEMarch 31, 2008
    
    $
    440
    
    
    
    907
    
    
    
    278
    
    
    
    1,625December 31, 2007
    
    $
    437
    
    
    
    991
    
    
    
    261
    
    
    
    1,689
 73




---



##### 



NOTE 4: SHARE-BASED PAYMENTS
       74




---



##### 



March 31, 2008Weighted-Average(Options and shares in thousands)
    
    Number
    
    
    Price (a)STOCK OPTIONSOptions outstanding, beginning of period
    
    
    128,971
    
    
    $
    41.09Granted
    
    
    10,604
    
    
    
    35.70Exercised
    
    
    (2,816
    )
    
    
    22.71Expired
    
    
    (2,178
    )
    
    
    42.02Forfeited
    
    
    (193
    )
    
    
    46.13Options outstanding, end of period
    
    
    134,388
    
    
    $
    41.02Options vested and expected to vest, end of period
    
    
    132,146
    
    
    $
    40.95Options exercisable, end of period
    
    
    100,047
    
    
    $
    39.49RESTRICTED STOCKUnvested shares, beginning of period
    
    
    19,914
    
    
    $
    54.18Granted
    
    
    11,144
    
    
    
    33.79Vested
    
    
    (4,273
    )
    
    
    56.27Forfeited
    
    
    (176
    )
    
    
    46.83Unvested shares, end of period
    
    
    26,609
    
    
    $
    45.36
  75




---



##### 



NOTE 5: COMPREHENSIVE INCOME
  Three Months EndedMarch 31,(In millions)
    
    2008
    
    
    2007COMPREHENSIVE INCOMENet income (loss)
    
    $
    (664
    )
    
    
    2,302OTHER COMPREHENSIVE INCOMEUnamortized gains under employee benefit plans
    
    
    6
    
    
    
    -Net unrealized gains (losses) on debt and equity securities
    
    
    (705
    )
    
    
    101Net unrealized gains on derivative financial instruments
    
    
    91
    
    
    
    65Total comprehensive income
    
    $
    (1,272
    )
    
    
    2,468
 76




---



##### 



NOTE 6: BUSINESS SEGMENTS
     Three Months Ended March 31, 2008Corporate
    
    
    
    
    
    
    
    
    
    
    Net Merger-and
    
    
    
    
    
    
    
    
    
    
    Related andGeneral
    
    
    Wealth
    
    
    Investment
    
    
    Capital
    
    
    
    
    
    
    Restructuring(Dollars in millions)
    
    Bank
    
    
    Management
    
    
    Bank
    
    
    Management
    
    
    Parent
    
    
    Expenses (b)
    
    
    ConsolidatedCONSOLIDATEDNet interest income (a)
    
    $
    3,455
    
    
    
    181
    
    
    
    1,032
    
    
    
    274
    
    
    
    (137
    )
    
    
    (53
    )
    
    
    4,752Fee and other income
    
    
    990
    
    
    
    211
    
    
    
    (159
    )
    
    
    2,191
    
    
    
    (456
    )
    
    
    -
    
    
    
    2,777Intersegment revenue
    
    
    55
    
    
    
    5
    
    
    
    (50
    )
    
    
    (10
    )
    
    
    -
    
    
    
    -
    
    
    
    -Total revenue (a)
    
    
    4,500
    
    
    
    397
    
    
    
    823
    
    
    
    2,455
    
    
    
    (593
    )
    
    
    (53
    )
    
    
    7,529Provision for credit losses
    
    
    569
    
    
    
    5
    
    
    
    197
    
    
    
    -
    
    
    
    2,060
    
    
    
    -
    
    
    
    2,831Noninterest expense
    
    
    2,050
    
    
    
    246
    
    
    
    747
    
    
    
    1,855
    
    
    
    302
    
    
    
    241
    
    
    
    5,441Minority interest
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    198
    
    
    
    (43
    )
    
    
    155Income taxes (benefits)
    
    
    675
    
    
    
    54
    
    
    
    (65
    )
    
    
    218
    
    
    
    (1,041
    )
    
    
    (75
    )
    
    
    (234
    )Tax-equivalent adjustment
    
    
    11
    
    
    
    -
    
    
    
    21
    
    
    
    1
    
    
    
    20
    
    
    
    (53
    )
    
    
    -Net income (loss)
    
    
    1,195
    
    
    
    92
    
    
    
    (77
    )
    
    
    381
    
    
    
    (2,132
    )
    
    
    (123
    )
    
    
    (664
    )Dividends on preferred stock
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    43
    
    
    
    -
    
    
    
    43Net income (loss) available tocommon stockholders
    
    $
    1,195
    
    
    
    92
    
    
    
    (77
    )
    
    
    381
    
    
    
    (2,175
    )
    
    
    (123
    )
    
    
    (707
    )Lending commitments
    
    $
    132,165
    
    
    
    7,007
    
    
    
    113,521
    
    
    
    1,348
    
    
    
    538
    
    
    
    -
    
    
    
    254,579Average loans, net
    
    
    311,447
    
    
    
    22,413
    
    
    
    101,024
    
    
    
    2,562
    
    
    
    28,490
    
    
    
    -
    
    
    
    465,936Average core deposits
    
    $
    297,680
    
    
    
    17,397
    
    
    
    33,623
    
    
    
    43,084
    
    
    
    2,729
    
    
    
    -
    
    
    
    394,513
 77




---



##### 



Three Months Ended March 31, 2007Corporate
    
    
    
    
    
    
    
    
    
    
    Net Merger-and
    
    
    
    
    
    
    
    
    
    
    Related andGeneral
    
    
    Wealth
    
    
    Investment
    
    
    Capital
    
    
    
    
    
    
    Restructuring(Dollars in millions)
    
    Bank
    
    
    Management
    
    
    Bank
    
    
    Management
    
    
    Parent
    
    
    Expenses (b)
    
    
    ConsolidatedCONSOLIDATEDNet interest income (a)
    
    $
    3,398
    
    
    
    181
    
    
    
    716
    
    
    
    259
    
    
    
    (17
    )
    
    
    (37
    )
    
    
    4,500Fee and other income
    
    
    845
    
    
    
    196
    
    
    
    1,109
    
    
    
    1,477
    
    
    
    107
    
    
    
    -
    
    
    
    3,734Intersegment revenue
    
    
    47
    
    
    
    3
    
    
    
    (43
    )
    
    
    (8
    )
    
    
    1
    
    
    
    -
    
    
    
    -Total revenue (a)
    
    
    4,290
    
    
    
    380
    
    
    
    1,782
    
    
    
    1,728
    
    
    
    91
    
    
    
    (37
    )
    
    
    8,234Provision for credit losses
    
    
    147
    
    
    
    1
    
    
    
    6
    
    
    
    -
    
    
    
    23
    
    
    
    -
    
    
    
    177Noninterest expense
    
    
    1,869
    
    
    
    247
    
    
    
    911
    
    
    
    1,237
    
    
    
    347
    
    
    
    10
    
    
    
    4,621Minority interest
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    136
    
    
    
    -
    
    
    
    136Income taxes (benefits)
    
    
    819
    
    
    
    48
    
    
    
    305
    
    
    
    179
    
    
    
    (349
    )
    
    
    (4
    )
    
    
    998Tax-equivalent adjustment
    
    
    11
    
    
    
    -
    
    
    
    10
    
    
    
    -
    
    
    
    16
    
    
    
    (37
    )
    
    
    -Net income (loss)
    
    $
    1,444
    
    
    
    84
    
    
    
    550
    
    
    
    312
    
    
    
    (82
    )
    
    
    (6
    )
    
    
    2,302Lending commitments
    
    $
    124,253
    
    
    
    6,686
    
    
    
    110,214
    
    
    
    961
    
    
    
    503
    
    
    
    -
    
    
    
    242,617Average loans, net
    
    
    288,229
    
    
    
    20,394
    
    
    
    73,385
    
    
    
    1,554
    
    
    
    31,699
    
    
    
    -
    
    
    
    415,261Average core deposits
    
    $
    284,046
    
    
    
    17,267
    
    
    
    34,227
    
    
    
    31,683
    
    
    
    2,047
    
    
    
    -
    
    
    
    369,270
   78




---



##### 



NOTE 7: BASIC AND DILUTED EARNINGS PER COMMON SHARE
  Three Months EndedMarch 31,(In millions, except per share data)
    
    2008
    
    
    2007Net income (loss)
    
    $
    (664
    )
    
    
    2,302Dividends on preferred stock
    
    
    43
    
    
    
    -Net income (loss) available to common stockholders
    
    $
    (707
    )
    
    
    2,302Basic earnings (loss) per common share
    
    $
    (0.36
    )
    
    
    1.22Diluted earnings (loss) per common share (a)
    
    $
    (0.36
    )
    
    
    1.20Average
common shares  basic
    
    
    1,963
    
    
    
    1,894Common share equivalents and unvested restricted stock
    
    
    14
    
    
    
    31Average common shares  diluted
    
    
    1,977
    
    
    
    1,925
  79




---



##### 



NOTE 8: INCOME TAXES
   UnrecognizedIncome TaxGross
    
    
    Deferred
    
    
    Benefits, NetFederal,
    
    
    Accrued
    
    
    Unrecognized
    
    
    Federal and
    
    
    of DeferredState and
    
    
    Interest and
    
    
    Income Tax
    
    
    State Income
    
    
    Federal and(In millions)
    
    Foreign Tax
    
    
    Penalties
    
    
    Benefits
    
    
    Tax Benefits
    
    
    State BenefitsBalance at January 1, 2008
    
    $
    2,217
    
    
    
    425
    
    
    
    2,642
    
    
    
    (257
    )
    
    
    2,385Additions for tax positions related to the current year
    
    
    64
    
    
    
    -
    
    
    
    64
    
    
    
    (7
    )
    
    
    57Additions for tax positions related to prior years
    
    
    32
    
    
    
    48
    
    
    
    80
    
    
    
    (17
    )
    
    
    63Reduction for tax positions related to prior years
    
    
    (1
    )
    
    
    -
    
    
    
    (1
    )
    
    
    -
    
    
    
    (1
    )Reductions for tax positions related to acquired entities
in prior years, offset to goodwill
    
    
    -
    
    
    
    (4
    )
    
    
    (4
    )
    
    
    (1
    )
    
    
    (5
    )Balance at March 31, 2008
    
    
    2,312
    
    
    
    469
    
    
    
    2,781
    
    
    
    (282
    )
    
    
    2,499Less: tax attributable to timing items included above
    
    
    (1,534
    )
    
    
    -
    
    
    
    (1,534
    )
    
    
    -
    
    
    
    (1,534
    )Less: UTBs included above that relate to acquired
entities that would impact goodwill if recognized
by December 31, 2008
    
    
    (80
    )
    
    
    (9
    )
    
    
    (89
    )
    
    
    25
    
    
    
    (64
    )Total UTBs that, if recognized, would impact the
effective income tax rate as of March 31, 2008
    
    $
    698
    
    
    
    460
    
    
    
    1,158
    
    
    
    (257
    )
    
    
    901
     BB&T
Corporation v. United States of America
 80




---



##### 



NOTE 9: DERIVATIVES
         81




---



##### 



March 31, 2008AverageNotional
    
    
    Gross Unrealized
    
    
    
    
    
    
    Maturity in(In millions)
    
    Hedged items or Transactions
    
    Amount
    
    
    Gains
    
    
    Losses (b)
    
    
    Equity (c)
    
    
    Years (d)ASSET HEDGES (a)Cash flow hedgesInterest rate swaps-receive fixed
    
    First forecasted interest receipts oncommercial loansPay 1 month LIBOR swaps
    
    1 month LIBOR risk
    
    $
    3,037
    
    
    
    187
    
    
    
    -
    
    
    
    116
    
    
    
    2.84Pay 3 month LIBOR swaps
    
    1 month LIBOR risk
    
    
    11,510
    
    
    
    773
    
    
    
    -
    
    
    
    479
    
    
    
    3.86Purchased interest rate floors-
    
    First forecasted interest receipts on 13 month LIBOR
    
    month LIBOR commercial loans
    
    
    21,250
    
    
    
    59
    
    
    
    -
    
    
    
    36
    
    
    
    2.06Call options on Eurodollar futures
    
    First forecasted interest payments on 1month LIBOR commercial loans
    
    
    56,500
    
    
    
    25
    
    
    
    -
    
    
    
    8
    
    
    
    0.25Fair value hedgesInterest rate swaps-pay fixed/
    
    Individual fixed rate debt securitiesreceive LIBOR
    
    classified as available for sale
    
    
    949
    
    
    
    -
    
    
    
    (47
    )
    
    
    -
    
    
    
    12.55Foreign currency forwards
    
    Currency risk associated with foreigncurrency denominated securitiesclassified as available for sale
    
    
    9,591
    
    
    
    -
    
    
    
    (1
    )
    
    
    -
    
    
    
    0.02Total asset hedges
    
    
    
    $
    102,837
    
    
    
    1,044
    
    
    
    (48
    )
    
    
    639
    
    
    
    1.20LIABILITY HEDGES (a)Cash flow hedgesInterest rate swaps-pay fixed
    
    First forecasted interest payments onlong-term debtReceive 1 month LIBOR swaps
    
    1 month LIBOR risk
    
    
    2,197
    
    
    
    2
    
    
    
    (281
    )
    
    
    (173
    )
    
    
    9.88Receive 3 month LIBOR swaps
    
    1 month LIBOR risk
    
    
    6,531
    
    
    
    -
    
    
    
    (342
    )
    
    
    (212
    )
    
    
    2.99Receive 3 month LIBOR swaps
    
    3 month LIBOR risk
    
    
    8,000
    
    
    
    -
    
    
    
    (115
    )
    
    
    (71
    )
    
    
    1.99Receive 6 month LIBOR swaps
    
    6 month LIBOR risk
    
    
    7
    
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    5.22Eurodollar futures
    
    1 day LIBOR risk associated with theproceeds from first forecasted issuanceof repurchase agreements that are partof a rollover strategy
    
    
    15,000
    
    
    
    -
    
    
    
    (25
    )
    
    
    (15
    )
    
    
    0.25Eurodollar futures
    
    First forecasted interest payments
on 3month LIBOR ling-term debt
    
    
    139,000
    
    
    
    -
    
    
    
    (115
    )
    
    
    (71
    )
    
    
    0.25Fair value hedgesInterest rate swaps-receive fixed/
    
    Individual fixed rate long-term debtpay floating (e)
    
    issuances
    
    
    33,607
    
    
    
    1,739
    
    
    
    (128
    )
    
    
    -
    
    
    
    10.04Foreign currency forwards
    
    Currency risk associated with foreignCurrency denominated repurchaseagreements and long-term debt
    
    
    12,951
    
    
    
    2
    
    
    
    (2
    )
    
    
    -
    
    
    
    0.09Currency swaps
    
    Currency risk associated with individualforeign currency denominated
long-termdebt
    
    
    1,004
    
    
    
    100
    
    
    
    -
    
    
    
    -
    
    
    
    5.06Total liability hedges
    
    
    
    
    218,297
    
    
    
    1,843
    
    
    
    (1,008
    )
    
    
    (542
    )
    
    
    2.01Total
    
    
    
    $
    321,134
    
    
    
    2,887
    
    
    
    (1,056
    )
    
    
    97
    
    
    
    -
 82




---



##### 



83




---



##### 



March 31, 20081 Year
    
    
    1-2
    
    
    2-5
    
    
    5-10
    
    
    After 10(In millions)
    
    or Less
    
    
    Years
    
    
    Years
    
    
    Years
    
    
    Years
    
    
    TotalCASH FLOW ASSET HEDGESNotional amount  swapsreceive fixed
    
    $
    102
    
    
    
    695
    
    
    
    13,010
    
    
    
    740
    
    
    
    -
    
    
    
    14,547Notional amount  other
    
    $
    56,500
    
    
    
    -
    
    
    
    21,250
    
    
    
    -
    
    
    
    -
    
    
    
    77,750Weighted average receive rate (a)
    
    
    5.27
    %
    
    
    5.23
    
    
    
    5.11
    
    
    
    4.71
    
    
    
    -
    
    
    
    5.10Weighted average pay rate (a)
    
    
    2.82
    %
    
    
    2.97
    
    
    
    3.08
    
    
    
    3.26
    
    
    
    -
    
    
    
    3.08Unrealized gain (loss)
    
    $
    30
    
    
    
    25
    
    
    
    943
    
    
    
    46
    
    
    
    -
    
    
    
    1,044FAIR VALUE ASSET HEDGESNotional amount  swapspay fixed
    
    $
    -
    
    
    
    -
    
    
    
    198
    
    
    
    198
    
    
    
    553
    
    
    
    949Notional amount  other
    
    $
    9,591
    
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    9,591Weighted average receive rate (a)
    
    
    -
    %
    
    
    -
    
    
    
    1.98
    
    
    
    2.05
    
    
    
    2.04
    
    
    
    2.03Weighted average pay rate (a)
    
    
    -
    %
    
    
    -
    
    
    
    3.36
    
    
    
    3.42
    
    
    
    3.92
    
    
    
    3.70Unrealized gain (loss)
    
    $
    (1
    )
    
    
    -
    
    
    
    (10
    )
    
    
    (11
    )
    
    
    (26
    )
    
    
    (48
    )CASH FLOW LIABILITY HEDGESNotional amount  swapspay fixed
    
    $
    43
    
    
    
    13,414
    
    
    
    510
    
    
    
    1,281
    
    
    
    1,487
    
    
    
    16,735Notional amount  other
    
    $
    154,000
    
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    154,000Weighted average receive rate (a)
    
    
    2.71
    %
    
    
    3.10
    
    
    
    2.85
    
    
    
    2.63
    
    
    
    2.78
    
    
    
    2.96Weighted average pay rate (a)
    
    
    5.52
    %
    
    
    5.28
    
    
    
    5.42
    
    
    
    6.10
    
    
    
    5.82
    
    
    
    5.50Unrealized gain (loss)
    
    $
    (141
    )
    
    
    (325
    )
    
    
    (44
    )
    
    
    (170
    )
    
    
    (196
    )
    
    
    (876
    )FAIR VALUE LIABILITY HEDGESNotional amount  swapsreceive fixed
    
    $
    5,375
    
    
    
    1,550
    
    
    
    4,387
    
    
    
    13,138
    
    
    
    9,157
    
    
    
    33,607Notional amount  other
    
    $
    12,951
    
    
    
    -
    
    
    
    822
    
    
    
    182
    
    
    
    -
    
    
    
    13,955Weighted average receive rate (a)
    
    
    4.34
    %
    
    
    4.94
    
    
    
    5.47
    
    
    
    4.80
    
    
    
    5.17
    
    
    
    4.92Weighted average pay rate (a)
    
    
    3.44
    %
    
    
    2.66
    
    
    
    3.62
    
    
    
    3.63
    
    
    
    4.06
    
    
    
    3.67Unrealized gain (loss)
    
    $
    71
    
    
    
    65
    
    
    
    371
    
    
    
    890
    
    
    
    314
    
    
    
    1,711
  84




---



##### 



March 31, 2008Asset
    
    
    Liability(In millions)
    
    Hedges
    
    
    Hedges
    
    
    TotalBalance, December 31, 2007
    
    $
    50,047
    
    
    
    152,993
    
    
    
    203,040Additions (a)
    
    
    95,070
    
    
    
    219,011
    
    
    
    314,081Maturities and amortizations (a)
    
    
    (4,820
    )
    
    
    (87,830
    )
    
    
    (92,650
    )Terminations
    
    
    (37,208
    )
    
    
    (62,800
    )
    
    
    (100,008
    )Redesignations and transfers to trading account assets
    
    
    (252
    )
    
    
    (3,077
    )
    
    
    (3,329
    )Balance, March 31, 2008
    
    $
    102,837
    
    
    
    218,297
    
    
    
    321,134
  85




---



##### 



NOTE 10: GUARANTEES
 March 31, 2008
    
    
    December 31, 2007Maximum
    
    
    
    
    
    
    MaximumCarrying
    
    
    Risk of
    
    
    Carrying
    
    
    Risk of(In millions)
    
    Amount
    
    
    Loss
    
    
    Amount
    
    
    LossSecurities and other lending indemnifications
    
    $
    -
    
    
    
    53,132
    
    
    
    -
    
    
    
    59,238Standby letters of credit
    
    
    114
    
    
    
    28,958
    
    
    
    124
    
    
    
    29,295Liquidity agreements
    
    
    159
    
    
    
    34,775
    
    
    
    14
    
    
    
    36,926Loans sold with recourse
    
    
    33
    
    
    
    6,399
    
    
    
    44
    
    
    
    6,710Residual value guarantees
    
    
    -
    
    
    
    936
    
    
    
    -
    
    
    
    1,123Written put options
    
    
    1,964
    
    
    
    17,013
    
    
    
    1,221
    
    
    
    15,273Contingent consideration
    
    
    -
    
    
    
    96
    
    
    
    -
    
    
    
    101Total guarantees
    
    $
    2,270
    
    
    
    141,309
    
    
    
    1,403
    
    
    
    148,666
 86




---



##### 



NOTE 11: FAIR VALUE MEASUREMENTS AND FAIR VALUE OPTION
 FAIR VALUE MEASUREMENTS
    Level 1
 Level 2
 Level 3
  DETERMINATION OF FAIR VALUE
    Derivatives
  87




---



##### 



Securities and Trading Activities
    Principal Investments
   88




---



##### 



Mortgage Servicing Rights
  Loans and Loans Held For Sale
  ITEMS
MEASURED AT FAIR VALUE ON A RECURRING BASIS
  March 31, 2008(In millions)
    
    Level 1
    
    
    Level 2
    
    
    Level 3
    
    
    Netting (b)
    
    
    TotalASSETSCash trading instruments
    
    $
    4,707
    
    
    
    32,681
    
    
    
    6,825
    
    
    
    -
    
    
    
    44,213Derivatives
    
    
    260
    
    
    
    121,011
    
    
    
    11,179
    
    
    
    (104,071
    )
    
    
    28,379Total trading account assets
    
    
    4,967
    
    
    
    153,692
    
    
    
    18,004
    
    
    
    (104,071
    )
    
    
    72,592Securities
    
    
    1,394
    
    
    
    103,751
    
    
    
    9,038
    
    
    
    -
    
    
    
    114,183Loans
    
    
    -
    
    
    
    -
    
    
    
    3
    
    
    
    -
    
    
    
    3Loans held for sale
    
    
    -
    
    
    
    3,546
    
    
    
    106
    
    
    
    -
    
    
    
    3,652Other assets (a)
    
    
    547
    
    
    
    4,072
    
    
    
    3,325
    
    
    
    (4,311
    )
    
    
    3,633Total assets at fair value
    
    $
    6,908
    
    
    
    265,061
    
    
    
    30,476
    
    
    
    (108,382
    )
    
    
    194,063LIABILITIESCash trading instruments
    
    
    4,973
    
    
    
    2,678
    
    
    
    55
    
    
    
    -
    
    
    
    7,706Derivatives
    
    
    679
    
    
    
    116,653
    
    
    
    12,153
    
    
    
    (108,304
    )
    
    
    21,181Total trading account liabilities
    
    
    5,652
    
    
    
    119,331
    
    
    
    12,208
    
    
    
    (108,304
    )
    
    
    28,887Other liabilities (a)
    
    
    140
    
    
    
    1,172
    
    
    
    61
    
    
    
    (4,311
    )
    
    
    (2,938
    )Total liabilities at fair value
    
    $
    5,792
    
    
    
    120,503
    
    
    
    12,269
    
    
    
    (112,615
    )
    
    
    25,949
   LEVEL
3 ITEMS MEASURED AT FAIR VALUE ON A RECURRING BASIS
   89




---



##### 



Three Months Ended March 31, 2008Change inunrealized gainsIncluded in
    
    
    Purchases,
    
    
    
    
    
    
    
    
    
    
    (losses) relatingother
    
    
    issuances and
    
    
    Transfers in
    
    
    
    
    
    
    to instrumentsBeginning
    
    
    Included in
    
    
    comprehensive
    
    
    settlements,
    
    
    and/or out
    
    
    Ending
    
    
    still held at the(In millions)
    
    balance
    
    
    earnings
    
    
    income
    
    
    net
    
    
    of Level 3
    
    
    balance
    
    
    reporting dateASSETSCash trading instruments
    
    $
    6,494
    
    
    
    (397
    )
    
    
    -
    
    
    
    341
    
    
    
    387
    
    
    
    6,825
    
    
    
    (399
    )Securities
    
    
    9,575
    
    
    
    (544
    )
    
    
    (290
    )
    
    
    2,558
    
    
    
    (2,261
    )
    
    
    9,038
    
    
    
    (58
    )Loans
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    3
    
    
    
    3
    
    
    
    -Loans held for sale
    
    
    106
    
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    106
    
    
    
    -Other assets
    
    $
    2,737
    
    
    
    642
    
    
    
    -
    
    
    
    (54
    )
    
    
    -
    
    
    
    3,325
    
    
    
    546LIABILITIESCash trading instruments
    
    $
    29
    
    
    
    3
    
    
    
    -
    
    
    
    (1
    )
    
    
    24
    
    
    
    55
    
    
    
    2Derivatives, net (a)
    
    
    605
    
    
    
    (94
    )
    
    
    -
    
    
    
    438
    
    
    
    25
    
    
    
    974
    
    
    
    178Other liabilities
    
    $
    32
    
    
    
    29
    
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    61
    
    
    
    (25
    )
   Three Months Ended March 31, 2008TradingNet
    
    
    Account
    
    
    
    
    
    
    SecuritiesInterest
    
    
    Profits
    
    
    Principal
    
    
    Gains
    
    
    Other(In millions)
    
    Income
    
    
    (Losses)
    
    
    Investing
    
    
    (Losses)
    
    
    IncomeTotal gains (losses)
    
    $
    3
    
    
    
    (330
    )
    
    
    506
    
    
    
    (543
    )
    
    
    127Change in unrealized gains (losses)
relating to
assets still held at March 31, 2008
    
    $
    -
    
    
    
    (241
    )
    
    
    407
    
    
    
    (58
    )
    
    
    136
 ITEMS
MEASURED AT FAIR VALUE ON A NONRECURRING BASIS
   90




---



##### 



Fair Value MeasurementsTotalgains(In millions)
    
    Level 1
    
    
    Level 2
    
    
    Level 3
    
    
    Total
    
    
    (losses)ASSETSLoans
    
    $
    -
    
    
    
    1,416
    
    
    
    1,258
    
    
    
    2,674
    
    
    
    (530
    )Loans held for sale
    
    
    -
    
    
    
    2,084
    
    
    
    748
    
    
    
    2,832
    
    
    
    (375
    )Other assets
    
    
    -
    
    
    
    242
    
    
    
    110
    
    
    
    352
    
    
    
    (117
    )LIABILITIESOther liabilities
    
    $
    -
    
    
    
    -
    
    
    
    -
    
    
    
    -
    
    
    
    -
 FAIR VALUE OPTION
   As of
    
    
    
    
    
    
    As ofJanuary 1,
    
    
    
    
    
    
    January 1,2008, prior to
    
    
    Transition
    
    
    2008, afteradoption of
    
    
    adjustment
    
    
    adoption of(In millions)
    
    SFAS 159
    
    
    gain (loss)
    
    
    SFAS 159Trading account assets
    
    $
    6,807
    
    
    
    (60
    )
    
    
    6,747Loans held for sale
    
    
    16
    
    
    
    -
    
    
    
    16Pretax cumulative effect of adoption of fair value option
    
    
    
    
    
    
    (60
    )Income taxes
    
    
    
    
    
    
    22Cumulative effect of adoption of fair value option
    
    
    
    
    
    $
    (38
    )
     91




---



##### 



Three Months Ended March 31, 2008Trading
    
    
    Other(In millions)
    
    Profits
    
    
    Income
    
    
    TotalTrading account assets (a)
    
    $
    52
    
    
    
    -
    
    
    
    52Loans held for sale
    
    $
    -
    
    
    
    42
    
    
    
    42
      92