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(GRAPHIC)




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MBNA precepts MBNA is a company of people committed to: (LINE)
    
    Providing the Customer with the finest products backed by consistently top-quality
service.(LINE)
    
    Delivering these products and services efficiently, thus ensuring fair prices to the
Customer and sound earnings for the stockholder.(LINE)
    
    Treating the Customer as we expect to be treated  putting the Customer first every day 
and meaning it.(LINE)
    
    Being leaders in innovation, quality, efficiency, and Customer satisfaction. Being known
for doing the little things and the big things well.(LINE)
    
    Insisting on an inclusive work environment where every single person is given the
encouragement, support, and opportunity to be successful.(LINE)
    
    Expecting and accepting from ourselves nothing short of the best. Remembering that each
of us, the people of MBNA, makes the unassailable difference.




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Contents    2
    
    Financial highlights3
    
    Letter to stockholders6
    
    Uniquely positioned8
    
    Uniquely qualified10
    
    Uniquely connected12
    
    Uniquely inspired14
    
    Leadership position17
    
    Financials121
    
    MBNA executive committee
      MBNA: A company like no other Its been nearly two decades since MBNAs precepts were introduced in
the summer of 1986. Today, the precepts remain strong and relevant
providing the foundation for a record of consistent performance,
growth, and industry leadership. The precepts have helped make MBNA
successful and distinctive a unique company that continues to set
the standard.
   MBNA annual report
2004          1




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Financial highlights Year ended December 31,
    
    2004
    
    
    2003
    
    
    2002
    
    
    2001
    
    
    2000(dollars in thousands, except per share amounts)Per Common Share Data(a)Earnings
    
    $
    2.08
    
    
    $
    1.82
    
    
    $
    1.37
    
    
    $
    1.31
    
    
    $
    1.05Earnings  assuming dilution
    
    
    2.05
    
    
    
    1.79
    
    
    
    1.34
    
    
    
    1.28
    
    
    
    1.02Dividends(b)
    
    
    .48
    
    
    
    .36
    
    
    
    .27
    
    
    
    .24
    
    
    
    .21Book value

    
    
    10.26
    
    
    
    8.53
    
    
    
    6.96
    
    
    
    5.94
    
    
    
    5.02RatiosReturn on average total assets
    
    
    4.39
    %
    
    
    4.16
    %
    
    
    3.67
    %
    
    
    4.16
    %
    
    
    3.94
    %Return on average stockholders equity
    
    
    21.72
    
    
    
    22.98
    
    
    
    21.29
    
    
    
    24.07
    
    
    
    25.79Stockholders equity to total assets
    
    
    21.59
    
    
    
    18.80
    
    
    
    17.22
    
    
    
    17.16
    
    
    
    17.13Sales and cash advance volume
    
    $
    206,161,349
    
    
    $
    184,293,873
    
    
    $
    160,046,164
    
    
    $
    142,261,636
    
    
    $
    125,683,731Financial Statement DataNet interest income
    
    $
    2,536,801
    
    
    $
    2,350,373
    
    
    $
    2,074,575
    
    
    $
    1,657,340
    
    
    $
    1,395,015Other operating income
    
    
    8,258,386
    
    
    
    7,825,480
    
    
    
    6,752,923
    
    
    
    6,673,316
    
    
    
    4,920,403Net Income(a)
    
    
    2,677,296
    
    
    
    2,338,104
    
    
    
    1,765,954
    
    
    
    1,694,291
    
    
    
    1,312,532Stockholders equity
    
    
    13,323,252
    
    
    
    11,113,040
    
    
    
    9,101,319
    
    
    
    7,798,718
    
    
    
    6,627,278Managed DataTotal managed loans
    
    $
    121,618,175
    
    
    $
    118,493,560
    
    
    $
    107,257,842
    
    
    $
    97,496,051
    
    
    $
    88,790,721
   (a)
    
    For full year 2002, net income excluding the change in the estimated value of accrued
interest and fees in September 2002 would have been $1.93 billion or $1.47 per common share 
assuming dilution.(b)
    
    On January 20, 2005, the Board of Directors declared an increase of 17% in the quarterly
dividend to $.14 per common share. This annual report includes managed data. A reconciliation of the managed data to the most directly
comparable GAAP data is included in the Managements Discussion and Analysis of Financial Condition
and Results of Operations section of the annual report. (BAR CHART)




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Dear Stockholders: For MBNA, 2004 was a year of noteworthy performance.
Thanks to the efforts of the talented and dedicated people of our company, we grew earnings 15% in
a slow industry growth environment, launched several exciting programs, such as our partnership
with American Express, and acquired important new businesses.    In our 14th year as a public company, MBNA
increased net income 15% to $2.7 billion, or $2.05 per
common share. And for the 14th consecutive year, MBNA
increased its quarterly dividend, which rose 17% to
$.14 per common share increasing the annual rate to
$.56 per common share, while also significantly
increasing capital. MBNA is in the business of lending money to qualified
people. We are a diversified consumer and
small-business lending company with operations in the
United States, Canada, the United Kingdom, Ireland,
and Spain. We market our products through more than
5,000 endorsing organizations and financial
institutions. We believe that lending to high-quality
individuals through affinity marketing offers a solid
foundation for continued growth and performance in
almost any market environment. Since 1982, weve delivered consistent, profitable
growth something we believe will continue, though at
a slower pace than in the past. Through the late
1990s, MBNA grew earnings 25% and averaged 20% since
our IPO. However, that pace slowed in 2004 as MBNA
gained scale and as growth in the U.S. credit card
industry declined. In this slower growth environment, MBNA produced
another year of earnings growth through increased
retail spending from our Customers, expanded product
offerings, product diversification, continued
commitment to credit quality, and tighter cost
controls. Loan Growth.Managed loans ended at $121.6 billion in
2004, up $3.1 billion, or 3%. Loan growth was impacted
by sluggishness in revolving consumer credit in the
United States, which
 increased only 4% in 2004. Loan growth was also
affected by our decision to reduce the number of 0%
balance transfer offers to new and existing
Customers. Instead, we of fer Customers significantly
improved rewards-based programs, such as MBNA
WorldPoints, Merrill Lynch rewards, and NFL Extra
Points. These types of accounts typically take longer
to develop balances, but have very good long-term
profitability. Spending on rewards accounts drove
retail sales volume up 17% in 2004 and led to strong
growth in other operating income. Asset Quality.The credit performance of our loan
portfolio improved significantly in 2004 as managed
net credit losses declined 48 basis points to 4.74%,
and managed delinquency declined 26 basis points to
4.13%. We continue to maintain stringent underwriting
standards, and the quality of new Customers added this
year is consistent with the quality of our existing
portfolio. New Endorsements.In 2004, we received new
endorsements from more than 280 organizations,
including Charles Schwab,
GMAC Mortgage Corporation, A.G. Edwards & Sons, and
the Massachusetts Institute of Technology. Diversification.We further diversified our loan
portfolio through key acquisitions, including the
purchase of Premium Credit Limited, the leading
insurance premium financing business in the United
Kingdom, and Sky Financial Solutions, a professional
practice financing business  extending our affinity-based marketing focus into complementary
business areas. We also opened a representative office
in Shanghai, China, as an important step toward
exploring further international expansion.
   (MBNA LOGO) MBNA annual report
2004          3




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MBNA CORPORATION BOARD OF DIRECTORS 
 Randolph D. Lerner, Esq. Bruce L. Hammonds James H. Berick, Esq. Mary M. Boies,
Esq. Benjamin R. Civiletti, Esq. William L. Jews Stuart L. Markowitz, MD William B. Milstead Thomas G. Murdough, Jr. Laura S.
Unger, Esq.
    American Express Partnership.A historic
agreement with American Express enables us to issue
MBNA Rewards American Express-branded credit cards in
the United States. We intend to also issue American
Express-branded credit cards in the United Kingdom,
Canada and Spain. This opens the door to new
opportunities for MBNA. With this step, MBNA offers a
full range of credit card products American Express,
Visa, and MasterCard  to Customers and potential
Customers. Today, hundreds of thousands of Customers
have activated their MBNA Rewards American Express
cards and are taking advantage of the valuable
benefits, backed by MBNAs top-notch Customer
satisfaction. Corporate Governance.We are especially pleased to
note that in 2004 MBNA continued to improve its
corporate governance policies and practices. The Board
of Directors named three new independent directors:
Mary Boies, Thomas Murdough, and Laura Unger. This
increases the total number of directors to 10, of
which eight are independent of management. In
addition, the board continued other governance
initiatives, including additional reductions in
executive compensation. Cost Controls.We announced a one-time restructuring
charge in the first quarter of 2005. This charge is a
result of voluntary early retirement and voluntary
severance programs. The programs will help MBNA
achieve staffing levels, particularly in management
positions, that match future business needs. The
charge will total approximately $300 million to $350
million pre-tax and result in anticipated pre-tax
expense savings of approximately $150 million in 2005
and $200 million in 2006. For stockholders, this is an
important investment in the future.
    Capital Management.MBNAs Board of Directors also
approved a share repurchase program and authorized the
repurchase of up to $2 billion of common stock over
the next two years. Stock repurchases will be done
selectively, based on capital levels, asset growth
levels, investment opportunities, acquisitions, and
share performance. The program reflects the
corporations commitment to returning excess capital
to stockholders while balancing the important
objectives of asset growth and maintaining a strong
balance sheet. In addition, MBNA increased its
dividend an average of more than 20% per year over the
last five years. MBNA Brand.The people of MBNA are committed to moving
the business ahead into new areas of opportunity. For
example, we made significant improvements in the
Customer experience and launched the MBNA brand with
the new tagline, If youre into it, were into it. Our
brand advertising campaign began with a television ad
during Super Bowl XXXIX and will continue in all media
throughout 2005. The primary purpose of the brand
campaign is to strengthen consumer awareness that the
things that matter to consumers  their passions,
interests, and affinities  also matter to MBNA. MBNA truly is a company like no other. This annual
report examines some of the things that make MBNA
unique, and some of the reasons why MBNA is the
recognized leader in affinity marketing. (-s- BRUCE HAMMONDS SIGNATURE) Bruce HammondsPresident and Chief Executive Officer (-s- RANDY LERNER SIGNATURE) Randy LernerChairman (-s- JOHN COCHRAN SIGNATURE) John CochranChief Operating Officer
   4          MBNA annual report 2004




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(PHOTO)




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(GRAPHIC)




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(GRAPHIC) When it comes to affinity marketing, no one else comes close. MBNA Corporation is an international financial services company like no other. We provide lending,
insurance, and deposit account products and services through operations in the United States, Canada,
the United Kingdom, Ireland, and Spain. MBNA makes loans to individuals and to small businesses. We do this through credit cards, consumer
loans, home equity loans, business credit cards, and other business lending products. We deliver our
products primarily through affinity marketing programs. As a result, MBNA has builta record of
consistent growth and performance. Over two decades, MBNA has established affinity and co-branded relationships with more than 5,000
organizations, including professional associations, colleges and universities, sports teams, financial
institutions, and many other groups. MBNAs unique position in the consumer that people care aboutorganizations inspiring pride and passion
among their members. We provide products and services that express loyalty and help organizations
strengthen relationships with their members. MBNA works aggressively to understand people who share common interests and to design the financial
products that meet their needs. We use diversified channels to market these products, including direct
mail, telesales, Internet, event, and point-of-sale marketing, and we market through bank branches,
financial advisors, and more. We back these marketing activities with service that generates a superior Customer experience at every
point of contact. In addition, our Customers have the freedom and flexibility to choose from an
innovative selection of reward programs that reflect their pride, passion, and interests. The result
is an experience that MBNA Customers have come to appreciate and value. MBNA combines the power of affinity relationships, the power of affinity rewards, and the power of the
Customer experience like no other company. Our unique approach to the entire concept of affinity
marketing is making MBNA one of the most recognized, respected, and valuable brands in our industry. Our recently launched brand-awareness campaign captures the spirit of affinity in a simple phrase: If
youre into it, were into it. The campaign helps Customers and potential Customers appreciate that
MBNA knows how to deliver financial products and services to people who share a common interest.




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(GRAPHIC)




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(GRAPHIC) When it comes to finding and keeping the right Customers, no one else comes close. Our approach to doing business is like no other in our industry. We get the right Customers through
affinity marketing and keep them by providing top-quality Customer satisfaction. Affinity marketing enables us to target our marketing effectively to attract the most qualified
applicants. Marketing to the members of our more than 5,000 affinity groups, we choose Customers from
a universe with very strong credit characteristics. This marketing approach, combined with our
sophisticated credit process, is one of the main reasons have historically been well below industry
averages. Unlike others, we dont rely solely on mental lending approach encourages MBNA people to make credit
decisions based on experience and, very often, personal contact with individual applicants. At MBNA,
talented people combine experience, technology, and predictive scoring with something equally
important to our success: common sense. Our unique way of marketing and lending has proven itself time and again. In 2004, quality improved
significantly as the characteristics of new Customers remained consistent with previous years. In
addition, MBNA Customers continue to use their cards more and carry higher loan balances than the
average credit card holder. The people of MBNA are guided in their work by the MBNA precepts (inside front cover). committed to
treating the Customer as we expect to be treatedputting the Customer first every dayand meaning it.
MBNA places a premium on attracting people who share these valuesvalues that build relationships and
strengthen Customer loyalty.




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(GRAPHIC)




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(GRAPHIC) When it comes to building relationships, no one else comes close. The way we build relationships with Customers is like no other in our industry. In 2004, MBNA launched
programs to extend opportunities to market segments with high potential for sustained growth and
development. During 2004, MBNA added more than 280 new affinity partners, including Charles Schwab and A.G. Edwards
&Sons. These endorsements cemented issuer in the brokerage, mutual fund, and insurance marketplace.
The endorsement of GMAC Mortgage Corporation added a unique and successful program that enables
consumers to reduce the length of their mortgages. The Massachusetts Institute of Technology joined
the ranks of leading academic institutions offering MBNA cards, as did the Université de Laval, a
Québec-based institution of higher learning dating back to 1663. Such prominent brand names as Starwood
Hotels & Resorts in Canada, Halfords in the United Kingdom, and Marsans travel agency, among many
others, also decided to endorse MBNA products in 2004. The number of professional organizations that endorse MBNA products reached more than 1,400 in 2004.
Our focus on marketing to professionals has resulted in MBNA products being carried by approximately
three-quarters of all physicians, two-thirds of all dentists, two-thirds of all attorneys, and half of
all engineers in the United States. MBNA products are also endorsed by more than 600 sports-related
organizations including the National Basketball Association, the National Football League, Major
League Baseball, NASCAR, the United States Tennis Association, and the Professional Golfers
Association. We have developed affinity products for virtually anything that anyone is interested
inat any stage of life. For example, if we have the American Student Dental Association card. When you
become licensed and begin your career, we have products endorsed by nearly all the state dental
associations. In addition, MBNA markets credit cards through the endorsements of hundreds of financial institutions
and credit unions. Financial institutions provide MBNA with effective sales channels including more
than 15,000 bank branches worldwide. MBNA also focused on expanding its lending products to the
student and alumni market in 2004 by building on our existing marketing activities with more than 850
colleges and universities, adding nearly 325,000 accounts during the year. And in the first such agreement by any U.S. bank, MBNA began issuing American Express-branded credit
cards in late 2004. The agreement represents our continuing commitment to offering our Customers a
broader array of products, backed by superior service and providing greater value, convenience, and
choice. Today, nearly 1,000 of agreed to the marketing of American Express-branded credit cards to
their membersand the list continues to grow.




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(GRAPHIC)




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(ANNUAL REPORT) When it comes to leveraging relationships, no one else comes close. We build relationships like no other in our industry. In todays competitive lending
environment, leveraging existing relationships to find additional areas of opportunity is
a powerful path to sustained performance. The spirit of innovation that led MBNA to pioneer affinity marketing remains very
much alive. Credit cards are often the basis for larger financial relationships between
MBNA and our Customers. By marketing credit cards to Customers, MBNA gains an
understanding of each Customers needs and circumstances, and this makes it possible to
offer other products, such as consumer loans, deposit accounts, business loans, and home
equity loans. Leveraging our knowledge of affinity groups has enabled us to build a consumer loan
business in the United States of $11.5 billion and a deposit base of more than $30
billion. One example of this is our relationship with the National Education Association
(NEA). Currently, more than a third of all teachers in the United States carry MBNA
credit cards with loan balances totaling $2.7 billion. Additionally, NEA members have
borrowed $675 million using other consumer lending products and have $4.1 billion in
deposits with MBNA. The 2004 acquisition of Sky Financial Solutions gives MBNA a way to offer financing for
equipment, practice start-ups, and working capital to dentists and other professionals.
Similarly, the acquisition of Premium Credit Limited in the United Kingdom enabled MBNA
to finance insurance premiums. Both of these new businesses provide good growth
potential for MBNA and, most important, are a good fit with MBNAs affinity marketing
strategy. The drive to improve the utility of our products led to further enhancements this year
of our most popular rewards programs. MBNAs WorldPoints program was launched in 2002 as
our principal rewards platform for card users, enabling Customers to earn one point for
every dollar spent and to redeem those points for travel, merchandise, or cash.
WorldPoints provides a comprehensive platform to build customized programs as we have
done for Merrill Lynch, Charles Schwab, and several other key endorsements. In 2004, the
portfolio of loans under this program climbed to more than $11 billion. Similar innovations and improvements have been made in a number of other programs with
strong potential growth. The Fidelity 529 program helps Customers save for their
childrens college education. Comparable programs for affinity partners, such as Royal
Caribbean Cruises, where Customers earn points towards their next cruise, have generated
notable Customer response. Such programs help Customers meet personal goals while demonstrating their affinity for
sponsoring organizations. This effort to improve and expand product offerings works for
the good of everyone involved  the affinity cardholder, the affinity organization, and
MBNA.




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MBNA is a leader like no other. Our 2004 results demonstrate that when it comes to affinity marketing, MBNA is a
leader like no other. In an environment that many regarded as difficult and having few
opportunities, we believe MBNA became even stronger. We led by adopting new growth strategies that are profitable and consistent with our
fundamental strengths. These strategies included developing new products responsive to
evolving market needs, forming new endorsing partnerships, and constantly looking for
ways to improve our Customer service. Our leadership in Customer satisfaction is a core strength, and our formula for
leadership remains constant. Have the right people. Give them the tools they need and an
enjoyable work environment. Provide good career opportunities, cutting-edge technology,
and programs to balance the demands of family and work. This commitment earned MBNA more awards and acknowledgments in 2004, both for
performance and as a place to work. FORTUNEmagazine named MBNA to its Hall of Fame as
one of only 22 companies to have been on its list of Best Places to Work For since the
lists inception in 1998. For the 13th consecutive year, Working Mothermagazine named
MBNA one of the best U.S. companies for mothers. The Irish Independentlisted the
company at the top of its roster of the 50 best companies to work for in Ireland.
FORTUNEalso named MBNA one of Americas Most Admired Companies for the second
consecutive year, and BusinessWeeknamed MBNA one of the 50 best-performing members of
the S&P 500. MBNA also leads through direct, active efforts to contribute to the communities where we
live and work. In 2004, our ongoing program of community involvement across all areas
provided not just money, but the time, energy, and experience of MBNA people for the
betterment of the local community. The MBNA Foundation maintained its commitment to improving the quality and availability
of education through grants and scholarships, as well as its support for organizations
involved in human services, promotion of the arts, and environmental preservation and
conservation. In 2004, MBNA, its Foundation, and MBNA people donated more than $60
million to support these and other important community needs. In addition, the people of
MBNA volunteered more than 600,000 hours of their time to charitable and educational
causes during 2004. MBNAs well-recognized focus on improving the well-being of communities does not alone
make the company unique. But no one else combines our community commitment with the
leadership and the power of MBNAs dedicated people. Its a unique formula, and a
defining characteristic of MBNA.
 
   14          MBNA annual report 2004




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Affinity cardsMBNA sells to people who share common interests, focusing on groups with strong ties to their
members, supporters, and Customers. Since entering this business in 1982, MBNAs unique
understanding of affinity marketing has enabled us to build mutually rewarding relationships with
organizations spanning a distinctively broad and diverse group of interests. Today, more than 5,000
organizations in the United States, Canada, the United Kingdom, Ireland, and Spain endorse MBNA
products.(CARDS GRAPHIC)




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Affinity cards (AFFINITY CARDS)




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FINANCIALS


| |     |  |  |                                                                                          
| | --- |  |  | -----------------------------------------------------------------------------------------
| | 18  |  |  | Five-Year Statistical Summary                                                            
|
| | 20  |  |  | Managements Discussion and Analysis of Financial Condition
    and Results of Operations
|
| | 72  |  |  | Managements Report on Internal Control Over Financial
    Reporting                     
|
| | 73  |  |  | Reports of Independent Registered Public Accounting Firm                                 
|
| | 75  |  |  | Consolidated Statements of Financial Condition                                           
|
| | 76  |  |  | Consolidated Statements of Income                                                        
|
| | 77  |  |  | Consolidated Statements of Changes in Stockholders Equity                               
|
| | 78  |  |  | Consolidated Statements of Cash Flows                                                    
|
| | 79  |  |  | Notes to the Consolidated Financial Statements                                           
|
| | 118 |  |  | Quarterly Data                                                                           
|
| | 119 |  |  | Stock Price Range and Dividends                                                          







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FIVE-YEAR STATISTICAL
SUMMARY (dollars in
thousands, except per share amounts)


|                                       |                                      |                           |             |             |             |      |             |             |             |   |             |            |             |   |             |            |            |   |             |            |            | 
|-------------------------------------- | ------------------------------------ | ------------------------- | ----------- | ----------- | ----------- | ---- | ----------- | ----------- | ----------- | - | ----------- | ---------- | ----------- | - | ----------- | ---------- | ---------- | - | ----------- | ---------- | ---------- | 
|Year Ended December 31,                |                                      |                           | 2004        |             |             | 2003 |             |             | 2002        |   |             | 2001       |             |   | 2000        |           
|                                       |                                     
|Income Statement Data for the Year (a) |                                      |                           |             |             |             |      |             |             |             |   |             |            |             |   |             |            |            |   |             |           
|Net interest income                    |                                      | $                         | 2,536,801   |             |             | $    | 2,350,373   |             |             | $ | 2,074,575   |            |             | $ | 1,657,340   |            |            | $ | 1,395,015   |           
|Provision for possible credit losses   |                                      |                           | 1,146,855   |             |             |      | 1,392,701   |             |             |   | 1,340,157   |            |             |   | 1,140,615   |            |            |   | 547,309     |           
|Other operating income                 |                                      |                           | 8,258,386   |             |             |      | 7,825,480   |             |             |   | 6,752,923   |            |             |   | 6,673,316   |            |            |   | 4,920,403   |           
|Other operating expense                |                                      |                           | 5,516,703   |             |             |      | 5,124,147   |             |             |   | 4,701,925   |            |             |   | 4,474,831   |            |            |   | 3,647,702   |           
|Net income                             |                                      |                           | 2,677,296   |             |             |      | 2,338,104   |             |             |   | 1,765,954   |            |             |   | 1,694,291   |            |            |   | 1,312,532   |           
|                                      
|Per Common Share Data for the Year (a) |                                      |                           |             |             |             |      |             |             |             |   |             |            |             |   |             |            |            |   |             |           
|Earnings                               |                                      | $                         | 2.08        |             |             | $    | 1.82        |             |             | $ | 1.37        |            |             | $ | 1.31        |            |            | $ | 1.05        |           
|Earnings assuming dilution            |                                      |                           | 2.05        |             |             |      | 1.79        |             |             |   | 1.34        |            |             |   | 1.28        |            |            |   | 1.02        |           
|Dividends                              |                                      |                           | .48         |             |             |      | .36         |             |             |   | .27         |            |             |   | .24         |            |            |   | .21         |           
|Book value                             |                                      |                           | 10.26       |             |             |      | 8.53        |             |             |   | 6.96        |            |             |   | 5.94        |            |            |   | 5.02        |           
|                                      
|Ratios (a)                             |                                      |                           |             |             |             |      |             |             |             |   |             |            |             |   |             |            |            |   |             |           
|Net interest margin (b) (c)            |                                      |                           | 5.33        | %           |             |      | 5.37        | %           |             |   | 5.54        | %          |             |   | 5.51        | %          |            |   | 5.50        | %         
|Return on average total assets         |                                      |                           | 4.39        |             |             |      | 4.16        |             |             |   | 3.67        |            |             |   | 4.16        |            |            |   | 3.94        |           
|Return on average stockholders equity |                                      |                           | 21.72       |             |             |      | 22.98       |             |             |   | 21.29       |            |             |   | 24.07       |            |            |   | 25.79       |           
|Stockholders equity to total assets   |                                      |                           | 21.59       |             |             |      | 18.80       |             |             |   | 17.22       |            |             |   | 17.16       |            |            |   | 17.13       |           
|Loan receivables (c) (d):              |                                      |                           |             |             |             |      |             |             |             |   |             |            |             |   |             |            |            |   |             |           
|                                       | Delinquency (e)                      |                           |             | 3.29        |             |      |             | 3.84        |             |   |             | 4.36       |             |   |             | 4.67       |            |   |             | 4.03       |           
|                                       | Net credit loss (f)                  |                           |             | 4.26        |             |      |             | 4.84        |             |   |             | 4.57       |             |   |             | 4.20       |            |   |             | 3.38       |           
|                                      
|Sales and Cash Advance Volume          |                                      |                           |             |             |             |      |             |             |             |   |             |            |             |   |             |            |            |   |             |           
|Sales volume:                          |                                      |                           |             |             |             |      |             |             |             |   |             |            |             |   |             |            |            |   |             |           
|                                       | Credit card                          |                           | $           | 128,565,008 |             |      | $           | 110,025,720 |             |   | $           | 93,797,769 |             |   | $           | 82,762,217 |            |   | $           | 75,295,766 |           
|                                       | Other consumer                       |                           |             | 292,168     |             |      |             | 628,816     |             |   |             | 804,960    |             |   |             | 968,410    |            |   |             | 1,114,550  |           
|                                       | Commercial                           |                           |             | 8,350,305   |             |      |             | 6,863,666   |             |   |             | 5,857,371  |             |   |             | 4,675,717  |            |   |             | 2,942,569  |           
|                                       |                                      |                           |             |             |             |      |             |             |             |   |             |            |             |   |            
|                                       |                                      | Total sales volume        |             |             | 137,207,481 |      |             |             | 117,518,202 |   |             |            | 100,460,100 |   |             |            | 88,406,344 |   |             |            | 79,352,885 | 
|Cash advance volume:                   |                                      |                           |             |             |             |      |             |             |             |   |             |            |             |   |             |            |            |   |             |           
|                                       | Credit card                          |                           |             | 54,345,322  |             |      |             | 60,635,839  |             |   |             | 52,899,242 |             |   |             | 46,362,279 |            |   |             | 39,979,492 |           
|                                       | Other consumer                       |                           |             | 10,625,256  |             |      |             | 5,667,969   |             |   |             | 6,306,576  |             |   |             | 7,150,739  |            |   |             | 5,910,863  |           
|                                       | Commercial                           |                           |             | 3,983,290   |             |      |             | 471,863     |             |   |             | 380,246    |             |   |             | 342,274    |            |   |             | 440,491    |           
|                                       |                                      |                           |             |             |             |      |             |             |             |   |             |            |             |   |            
|                                       |                                      | Total cash advance volume |             |             | 68,953,868  |      |             |             | 66,775,671  |   |             |            | 59,586,064  |   |             |            | 53,855,292 |   |             |            | 46,330,846 | 
|                                       |                                      |                           |             |             |             |      |             |             |             |   |             |            |             |   |            
|Sales and cash advance volume          |                                      | $                         | 206,161,349 |             |             | $    | 184,293,873 |             |             | $ | 160,046,164 |            |             | $ | 142,261,636 |            |            | $ | 125,683,731 |           
|                                       |                                      |                           |             |             |             |      |             |             |             |   |             |            |             |   |            
|                                      
|Managed Data (a) (h)                   |                                      |                           |             |             |             |      |             |             |             |   |             |            |             |   |             |            |            |   |             |           
|At year end:                           |                                      |                           |             |             |             |      |             |             |             |   |             |            |             |   |             |            |            |   |             |           
|                                       | Loans held for securitization        |                           | $           | 8,239,487   |             |      | $           | 13,084,105  |             |   | $           | 11,029,627 |             |   | $           | 9,929,948  |            |   | $           | 8,271,933  |           
|                                       | Loan portfolio                       |                           |             | 25,519,363  |             |      |             | 20,539,972  |             |   |             | 17,696,881 |             |   |             | 14,703,616 |            |   |             | 11,682,904 |           
|                                       | Securitized loans                    |                           |             | 87,859,325  |             |      |             | 84,869,483  |             |   |             | 78,531,334 |             |   |             | 72,862,487 |            |   |             | 68,835,884 |           
|                                       |                                      |                           |             |             |             |      |             |             |             |   |             |            |             |   |            
|                                       |                                      | Total managed loans       |             | $           | 121,618,175 |      |             | $           | 118,493,560 |   |             | $          | 107,257,842 |   |             | $          | 97,496,051 |   |             | $          | 88,790,721 | 
|                                       |                                      |                           |             |             |             |      |             |             |             |   |             |            |             |   |            
|Average for the year:                  |                                      |                           |             |             |             |      |             |             |             |   |             |            |             |   |             |            |            |   |             |           
|                                       | Loans held for securitization        |                           | $           | 8,893,754   |             |      | $           | 9,198,810   |             |   | $           | 8,130,207  |             |   | $           | 6,909,840  |            |   | $           | 8,129,333  |           
|                                       | Loan portfolio                       |                           |             | 22,162,033  |             |      |             | 18,985,008  |             |   |             | 17,184,993 |             |   |             | 13,429,548 |            |   |             | 9,588,815  |           
|                                       | Securitized loans                    |                           |             | 87,040,251  |             |      |             | 81,691,156  |             |   |             | 74,718,731 |             |   |             | 70,560,600 |            |   |             | 59,726,838 |           
|                                       |                                      |                           |             |             |             |      |             |             |             |   |             |            |             |   |            
|                                       |                                      | Total managed loans       |             | $           | 118,096,038 |      |             | $           | 109,874,974 |   |             | $          | 100,033,931 |   |             | $          | 90,899,988 |   |             | $          | 77,444,986 | 
|                                       |                                      |                           |             |             |             |      |             |             |             |   |             |            |             |   |            
|For the year:                          |                                      |                           |             |             |             |      |             |             |             |   |             |            |             |   |             |            |            |   |             |           
|                                       | Delinquency (c) (e)                  |                           |             | 4.13        | %           |      |             | 4.39        | %           |   |             | 4.88       | %           |   |             | 5.09       | %          |   |             | 4.49       | %         
|                                       | Net credit loss (c) (f)              |                           |             | 4.74        |             |      |             | 5.22        |             |   |             | 4.99       |             |   |             | 4.74       |            |   |             | 4.39       |           
|                                       | Net interest margin (b) (c)          |                           |             | 7.98        |             |      |             | 8.39        |             |   |             | 8.42       |             |   |             | 8.42       |            |   |             | 7.08       |           
|                                       | Net interest income                  |                           | $           | 10,421,272  |             |      | $           | 10,204,638  |             |   | $           | 9,118,677  |             |   | $           | 8,204,142  |            |   | $           | 5,837,109  |           
|                                       | Provision for possible credit losses |                           |             | 5,422,879   |             |      |             | 5,768,170   |             |   |             | 5,175,540  |             |   |             | 4,592,629  |            |   |             | 3,348,289  |           
|                                       | Other operating income               |                           |             | 4,649,939   |             |      |             | 4,346,684   |             |   |             | 3,544,204  |             |   |             | 3,578,528  |            |   |             | 3,279,289  |           
|                                      



|    |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|--- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) |  | In September 2002, MBNA Corporation implemented the one-time
    industry wide Federal Financial Institutions Examination
    Councils (FFIEC) accounting guidance, and
    changed the estimated value of accrued interest and fees,
    resulting in a decrease to income before income taxes of
    $263.7 million ($167.2 million after taxes) for the
    twelve months ended December 31, 2002. Net income for the
    twelve months ended December 31, 2002 was $1.8 billion
    or $1.34 per common shareassuming dilution. Excluding
    this change in September 2002, earnings per common
    shareassuming dilution for the twelve months ended
    December 31, 2002 would have been $1.47, an increase of 15%
    compared with the twelve months ended December 31, 2001.
    Earnings per common shareassuming dilution for the twelve
    months ended December 31, 2003 increased 34%, compared with
    the twelve months ended December 31, 2002. Excluding this
    change in September 2002, earnings per common
    shareassuming dilution for the twelve months ended
    December 31, 2003 would have increased 22%, compared with
    the twelve months ended December 31, 2002.
|   
|(b) |  | Net interest margin ratios are presented on a fully taxable
    equivalent basis.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   
|(c) |  | In December 2000, MBNA Corporation implemented the FFIEC revised
    policy on the classification of consumer loans. Excluding the
    one-time FFIEC adjustment, loan delinquency and managed loan
    delinquency would have been 4.32% and 4.94%, respectively, at
    December 31, 2000, and loan receivable net credit losses,
    managed net credit losses, net interest margin, and managed net
    interest margin would have been 3.03%, 3.94%, 5.54%, and 7.14%,
    respectively, for the year ended December 31, 2000.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|   
|(d) |  | Loan receivables include loans held for securitization and the
    loan portfolio.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   
|(e) |  | Delinquency represents accruing loans that are 30 days or
    more past due.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     







---



##### 



FIVE-YEAR STATISTICAL SUMMARY 
Continued (dollars in
thousands)


|                                                                                  |                            |   |            |            |  |      |            |            |      |   |            |            |  |   |            |            |  |   |            |            | 
|--------------------------------------------------------------------------------- | -------------------------- | - | ---------- | ---------- |  | ---- | ---------- | ---------- | ---- | - | ---------- | ---------- |  | - | ---------- | ---------- |  | - | ---------- | ---------- | 
|Year Ended December 31,                                                           |                            |   | 2004       |            |  | 2003 |            |            | 2002 |   |            | 2001       |  |   | 2000       |           
|                                                                                  |                           
|Balance Sheet Data at Year End (a)                                                |                            |   |            |            |  |      |            |            |      |   |            |            |  |   |            |            |  |   |            |           
|Investment securities and money market instruments                                |                            | $ | 10,734,425 |            |  | $    | 9,581,715  |            |      | $ | 9,423,620  |            |  | $ | 6,517,052  |            |  | $ | 5,205,395  |           
|Loans held for securitization                                                     |                            |   | 8,239,487  |            |  |      | 13,084,105 |            |      |   | 11,029,627 |            |  |   | 9,929,948  |            |  |   | 8,271,933  |           
|Credit card loans (g)                                                             |                            |   | 12,468,200 |            |  |      | 11,190,382 |            |      |   | 9,045,051  |            |  |   | 7,129,964  |            |  |   | 6,985,664  |           
|Other consumer loans (g)                                                          |                            |   | 9,089,065  |            |  |      | 8,017,730  |            |      |   | 8,061,219  |            |  |   | 6,321,182  |            |  |   | 3,789,213  |           
|Commercial loans (g)                                                              |                            |   | 3,962,098  |            |  |      | 1,331,860  |            |      |   | 590,611    |            |  |   | 1,252,470  |            |  |   | 908,027    |           
|                                                                                  |                            |   |            |            |  |      |            |            |      |   |            |            |  |   |           
|                                                                                  | Total loan portfolio       |   |            | 25,519,363 |  |      |            | 20,539,972 |      |   |            | 17,696,881 |  |   |            | 14,703,616 |  |   |            | 11,682,904 | 
|                                                                                  |                            |   |            |            |  |      |            |            |      |   |            |            |  |   |           
|                                                                                  | Total loan receivables (d) |   |            | 33,758,850 |  |      |            | 33,624,077 |      |   |            | 28,726,508 |  |   |            | 24,633,564 |  |   |            | 19,954,837 | 
|Reserve for possible credit losses                                                |                            |   | (1,136,558 | )          |  |      | (1,216,316 | )          |      |   | (1,111,299 | )          |  |   | (833,423   | )          |  |   | (527,573   | )         
|                                                                                  |                            |   |            |            |  |      |            |            |      |   |            |            |  |   |           
|                                                                                  | Net loan receivables       |   |            | 32,622,292 |  |      |            | 32,407,761 |      |   |            | 27,615,209 |  |   |            | 23,800,141 |  |   |            | 19,427,264 | 
|Total assets                                                                      |                            |   | 61,714,140 |            |  |      | 59,113,355 |            |      |   | 52,856,746 |            |  |   | 45,447,945 |            |  |   | 38,678,096 |           
|Total deposits                                                                    |                            |   | 31,239,504 |            |  |      | 31,836,081 |            |      |   | 30,616,216 |            |  |   | 27,094,745 |            |  |   | 24,343,595 |           
|Long-term debt and bank notes                                                     |                            |   | 11,422,900 |            |  |      | 12,145,628 |            |      |   | 9,538,173  |            |  |   | 6,867,033  |            |  |   | 5,735,635  |           
|Stockholders equity                                                              |                            |   | 13,323,252 |            |  |      | 11,113,040 |            |      |   | 9,101,319  |            |  |   | 7,798,718  |            |  |   | 6,627,278  |           
|                                                                                 
|Average Balance Sheet Data for the Year (a)                                       |                            |   |            |            |  |      |            |            |      |   |            |            |  |   |            |            |  |   |            |           
|Investment securities and money market instruments                                |                            | $ | 12,446,434 |            |  | $    | 11,693,550 |            |      | $ | 8,257,838  |            |  | $ | 6,500,608  |            |  | $ | 5,051,619  |           
|Loans held for securitization                                                     |                            |   | 8,893,754  |            |  |      | 9,198,810  |            |      |   | 8,130,207  |            |  |   | 6,909,840  |            |  |   | 8,129,333  |           
|Credit card loans (g)                                                             |                            |   | 10,325,720 |            |  |      | 10,071,707 |            |      |   | 8,778,664  |            |  |   | 6,936,549  |            |  |   | 6,217,991  |           
|Other consumer loans (g)                                                          |                            |   | 8,581,485  |            |  |      | 8,149,690  |            |      |   | 7,371,626  |            |  |   | 5,433,669  |            |  |   | 2,716,974  |           
|Commercial loans (g)                                                              |                            |   | 3,254,828  |            |  |      | 763,611    |            |      |   | 1,034,703  |            |  |   | 1,059,330  |            |  |   | 653,850    |           
|                                                                                  |                            |   |            |            |  |      |            |            |      |   |            |            |  |   |           
|                                                                                  | Total loan portfolio       |   |            | 22,162,033 |  |      |            | 18,985,008 |      |   |            | 17,184,993 |  |   |            | 13,429,548 |  |   |            | 9,588,815  | 
|                                                                                  |                            |   |            |            |  |      |            |            |      |   |            |            |  |   |           
|                                                                                  | Total loan receivables (d) |   |            | 31,055,787 |  |      |            | 28,183,818 |      |   |            | 25,315,200 |  |   |            | 20,339,388 |  |   |            | 17,718,148 | 
|Reserve for possible credit losses                                                |                            |   | (1,206,631 | )          |  |      | (1,158,510 | )          |      |   | (941,780   | )          |  |   | (656,654   | )          |  |   | (549,033   | )         
|                                                                                  |                            |   |            |            |  |      |            |            |      |   |            |            |  |   |           
|                                                                                  | Net loan receivables       |   |            | 29,849,156 |  |      |            | 27,025,308 |      |   |            | 24,373,420 |  |   |            | 19,682,734 |  |   |            | 17,169,115 | 
|Total assets                                                                      |                            |   | 60,952,688 |            |  |      | 56,232,903 |            |      |   | 48,154,027 |            |  |   | 40,764,316 |            |  |   | 33,299,176 |           
|Total deposits                                                                    |                            |   | 31,893,637 |            |  |      | 31,880,540 |            |      |   | 28,481,487 |            |  |   | 25,147,782 |            |  |   | 20,654,087 |           
|Long-term debt and bank notes                                                     |                            |   | 11,715,410 |            |  |      | 10,557,593 |            |      |   | 8,040,419  |            |  |   | 6,309,446  |            |  |   | 5,699,638  |           
|Stockholders equity                                                              |                            |   | 12,328,216 |            |  |      | 10,172,778 |            |      |   | 8,293,823  |            |  |   | 7,039,986  |            |  |   | 5,088,882  |           
|Weighted average common shares outstanding (000)                                  |                            |   | 1,277,833  |            |  |      | 1,278,166  |            |      |   | 1,277,787  |            |  |   | 1,277,745  |            |  |   | 1,230,827  |           
|Weighted average common shares outstanding and common stock
    equivalents (000) |                            |   | 1,297,178  |            |  |      | 1,295,142  |            |      |   | 1,302,712  |            |  |   | 1,314,230  |            |  |   | 1,269,803  |           
|                                                                                 



|    |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|--- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(f) |  | MBNA Corporations net credit loss ratio is calculated by
    dividing annualized net credit losses, which exclude
    uncollectible accrued interest and fees and fraud losses, for
    the period by average loans, which include estimated collectible
    billed interest and fees for the corresponding period.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   
|(g) |  | MBNA Corporation reclassified certain loan products to
    separately report its commercial loan products. Business card
    products were reclassified from credit card loans to commercial
    loans, and all other commercial loan products were reclassified
    from other consumer loans to commercial loans. For purposes of
    comparability, certain prior period amounts have been
    reclassified.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|   
|(h) |  | MBNA Corporation allocates resources on a managed basis, and
    financial data provided to management reflects MBNA
    Corporations results on a managed basis. Managed data
    assumes MBNA Corporations securitized loan principal
    receivables have not been sold and presents the earnings on
    securitized loan principal receivables in the same fashion as
    MBNA Corporations owned loans. Management, equity and debt
    analysts, rating agencies and others evaluate MBNA
    Corporations operations on a managed basis because the
    loans that are securitized are subject to underwriting standards
    comparable to MBNA Corporations owned loans, and MBNA
    Corporation services the securitized and owned loans, and the
    related accounts, together and in the same manner without regard
    to ownership of the loans. In a securitization, the account
    relationships are not sold to the trust. MBNA Corporation
    continues to own and service the accounts that generate the
    securitized loan principal receivables. The credit performance
    of the entire managed loan portfolio is important to understand
    the quality of originations and the related credit risks
    inherent in the owned portfolio and retained interests in its
    securitization transactions.
|   
|    |  | Table 39 reconciles income statement data for the period to
    managed net interest income, managed provision for possible
    credit losses, and managed other operating income, and the loan
    receivables net credit loss ratio to the managed net credit loss
    ratio, the loan receivables delinquency ratio to the managed
    delinquency ratio, and the net interest margin ratio to the
    managed net interest margin ratio. Managed other operating
    income includes the impact of the gain recognized on securitized
    loan principal receivables in accordance with Statement of
    Financial Accounting Standards No. 140, Accounting
    for Transfers and Servicing of Financial Assets and
    Extinguishments of Liabilities a Replacement of FASB
    Statement No. 125 (Statement
    No. 140).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      







---



##### 



MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS




|     |    |  |  |                                                                           
|---- | -- |  |  | --------------------------------------------------------------------------
|Page |    |  | 
|     | 21 |  |  | Introduction and Overview                                                 
|     | 22 |  |  | Critical Accounting Policies                                              
|     | 25 |  |  | Change in Accounting Estimate for Interest
    and Fees Recognized in 2002
|     | 25 |  |  | Earnings Summary                                                          
|     | 27 |  |  | Net Interest Income                                                       
|     | 31 |  |  | Investment Securities and Money Market Instruments                        
|     | 31 |  |  | Other Interest-Earning Assets                                             
|     | 31 |  |  | Loan Receivables                                                          
|     | 35 |  |  | Premises and Equipment                                                    
|     | 36 |  |  | Accrued Income Receivable                                                 
|     | 36 |  |  | Accounts Receivable from Securitization                                   
|     | 36 |  |  | Intangible Assets and Goodwill                                            
|     | 36 |  |  | Prepaid Expenses and Deferred Charges                                     
|     | 36 |  |  | Interest-Bearing Deposits                                                 
|     | 37 |  |  | Borrowed Funds                                                            
|     | 38 |  |  | Noninterest-Bearing Deposits                                              
|     | 38 |  |  | Accrued Interest Payable                                                  
|     | 38 |  |  | Accrued Expenses and Other Liabilities                                    
|     | 38 |  |  | Accumulated Other Comprehensive Income                                    
|     | 38 |  |  | Total Other Operating Income                                              
|     | 43 |  |  | Total Other Operating Expense                                             
|     | 44 |  |  | Income Taxes                                                              
|     | 44 |  |  | Loan Quality                                                              
|     | 55 |  |  | Capital Adequacy                                                          
|     | 56 |  |  | Dividend Limitations                                                      
|     | 56 |  |  | Off-Balance Sheet Arrangements                                            
|     | 62 |  |  | Liquidity and Rate Sensitivity                                            
|     | 68 |  |  | Cross-Border Outstandings                                                 
|     | 68 |  |  | Regulatory and Other Matters                                              
|     | 70 |  |  | Managed Reconciliation of the Five-Year Statistical Summary               





---



##### 



MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS




INTRODUCTION AND OVERVIEW




EXECUTIVE SUMMARY
  Highlights for 2004:
 
    Loan receivables increased by $134.8 million to
    $33.8 billion, and managed loans increased by
    $3.1 billion to $121.6 billion, as compared to 2003,
    primarily as a result of the acquisitions of Premium Credit
    Limited ($1.6 billion of acquired commercial and other
    consumer loans) and Sky Financial Solutions, Inc.
    ($893.0 million of acquired commercial loans) in the first
    quarter of 2004, as well as the strengthening of foreign
    currencies against the U.S. dollar. Management believes
    that loan growth in 2004 was slower than in previous years
    because the Corporation offered less 0% promotional rate offers
    on U.S. credit card accounts. Also, loan growth was slower
    than in previous years because revolving consumer credit growth
    in the U.S. was slower over the past two to three years.
    Management believes foreign loan growth in 2004 was






---



##### 





slower than in previous years due
    to the increasingly competitive environment in the U.K. and
    Canada. See Loan Receivables for a discussion of the
    income earned on loan receivables, Total Other Operating
    Income Securitization Income for a discussion of the
    income earned on securitized loans, and Off-Balance Sheet
    Arrangements Impact of Off-Balance Sheet Asset
    Securitization Transactions on the Corporations
    Results for a discussion of the income earned on managed
    loans.  
    The net interest margin declined 4 basis points to 5.33%
    and the managed net interest margin declined 41 basis
    points to 7.98% for 2004, as compared to the same period in
    2003. See Net Interest Income Net Interest
    Margin for a discussion of the net interest margin,
    Total Other Operating Income Securitization
    Income for a discussion of the net interest margin earned
    on securitized loans, and Off-Balance Sheet
    Arrangements Impact of Off-Balance Sheet Asset
    Securitization Transactions on the Corporations
    Results for a discussion of managed net interest margin.
    Total other operating income increased by $432.9 million to
    $8.3 billion for 2004, as compared to the same period in
    2003. See Total Other Operating Income for a
    discussion of total other operating income.
    Based on improving asset quality trends, enhanced collection
    strategies, and an improved economy, the provision for possible
    credit losses in 2004 was $245.8 million lower than in
    2003. Net credit losses on loan receivables declined
    58 basis points to 4.26% and net credit losses on managed
    loans declined 48 basis points to 4.74% for 2004, as
    compared to the same period in 2003. Loan losses continue to be
    lower than published industry levels. See Loan
    Quality Net Credit Losses for a discussion of net
    credit losses.
    The Corporation attempts to balance its net interest margin and
    credit losses to achieve a consistent risk-adjusted managed net
    interest margin. The risk-adjusted managed net interest margin
    is the managed net interest margin less the managed net credit
    loss ratio. The risk-adjusted managed net interest margin was
    3.24% and 3.17% for 2004 and 2003, respectively. See
    Off-Balance Sheet Arrangements Impact of Off-Balance
    Sheet Asset Securitization Transactions on the
    Corporations Results for a reconciliation of the
    managed net interest margin ratio to the net interest margin
    ratio, and Loan Quality Net Credit Losses for
    a reconciliation of the managed net credit loss ratio to the
    loan receivables net credit loss ratio.  New Developments:
 
    The Corporation began marketing American Express branded cards
    in the fourth quarter of 2004, providing its Customers the
    ability to take advantage of the valuable benefits of an
    American Express card backed by the Corporations top-notch
    Customer satisfaction.



    The Corporation will incur a one-time restructuring charge
    approximating $300 million to $350 million pre-tax in
    the first quarter of 2005. The restructuring charge will result
    in anticipated pre-tax expense savings of approximately
    $150 million in 2005 and $200 million in 2006. The
    restructuring charge is a result of the initiation of a
    voluntary early retirement program and a voluntary employee
    severance program. During the last several years, the
    Corporation has taken steps to reduce its expenses through
    reduced hiring and other programs. Despite these efforts, the
    Corporation remains staffed, particularly in management
    positions, at a level higher than anticipated business needs
    require. The Corporation believes that the voluntary early
    retirement and severance programs will assist the Corporation in
    achieving staffing levels that meet expected future business
    needs and make the Corporation more efficient. Following the end
    of the voluntary early retirement and severance programs in
    March 2005, the Corporation will undertake a review of its
    operations and look for opportunities to consolidate some of its
    facilities. The Corporation may incur additional expenses for
    the disposition of fixed assets related to this consolidation.
    See Note 34: Subsequent Events for further detail on this
    restructuring charge.
    In January 2005, the Corporations Board of Directors
    approved a share repurchase program and authorized the
    repurchase of up to $2 billion of common stock over the
    next two years. Stock repurchases will be done selectively,
    based on capital levels, asset growth levels, and share
    performance. The program reflects the Corporations
    commitment to return excess capital to stockholders while
    balancing the important objectives of asset growth and
    maintaining a strong balance sheet. This repurchase program will
    be in addition to the Corporations existing share
    repurchase program, which utilizes share repurchases to offset
    the impact of stock-based compensation programs.   CRITICAL ACCOUNTING POLICIES








---



##### 





OFF-BALANCE SHEET ASSET SECURITIZATION




RESERVE FOR POSSIBLE CREDIT LOSSES






---



##### 



INTANGIBLE ASSETS AND GOODWILL


REVENUE RECOGNITION








---



##### 






CHANGE IN ACCOUNTING ESTIMATE FORINTEREST AND FEES
RECOGNIZED IN 2002
   EARNINGS SUMMARY








---



##### 



TABLE 1: SUMMARIZED CONSOLIDATED STATEMENTS OF
INCOME (dollars in
thousands, except per share amounts)


|                                            |                                                                |   |           |           |  |      |           |           |      |   |           |           | 
|------------------------------------------- | -------------------------------------------------------------- | - | --------- | --------- |  | ---- | --------- | --------- | ---- | - | --------- | --------- | 
|Year Ended December 31,                     |                                                                |   | 2004      |           |  | 2003 |           |           | 2002 |  
|                                           
|                                           
|Total interest income                       |                                                                | $ | 4,068,619 |           |  | $    | 3,858,884 |           |      | $ | 3,678,070 |          
|Total interest expense                      |                                                                |   | 1,531,818 |           |  |      | 1,508,511 |           |      |   | 1,603,495 |          
|                                            |                                                                |   |           |           |  |      |           |           |     
|                                            | Net interest income                                            |   |           | 2,536,801 |  |      |           | 2,350,373 |      |   |           | 2,074,575 | 
|Provision for possible credit losses        |                                                                |   | 1,146,855 |           |  |      | 1,392,701 |           |      |   | 1,340,157 |          
|                                            |                                                                |   |           |           |  |      |           |           |     
|                                            | Net interest income after provision for possible credit losses |   |           | 1,389,946 |  |      |           | 957,672   |      |   |           | 734,418   | 
|                                           
|Total other operating income                |                                                                |   | 8,258,386 |           |  |      | 7,825,480 |           |      |   | 6,752,923 |          
|Total other operating expense               |                                                                |   | 5,516,703 |           |  |      | 5,124,147 |           |      |   | 4,701,925 |          
|                                            |                                                                |   |           |           |  |      |           |           |     
|                                            | Income before income taxes                                     |   |           | 4,131,629 |  |      |           | 3,659,005 |      |   |           | 2,785,416 | 
|Applicable income taxes                     |                                                                |   | 1,454,333 |           |  |      | 1,320,901 |           |      |   | 1,019,462 |          
|                                            |                                                                |   |           |           |  |      |           |           |     
|                                            | Net income                                                     |   | $         | 2,677,296 |  |      | $         | 2,338,104 |      |   | $         | 1,765,954 | 
|                                            |                                                                |   |           |           |  |      |           |           |     
|                                           
|Earnings per common share                   |                                                                | $ | 2.08      |           |  | $    | 1.82      |           |      | $ | 1.37      |          
|Earnings per common shareassuming dilution |                                                                |   | 2.05      |           |  |      | 1.79      |           |      |   | 1.34      |          
|Dividends per common share                  |                                                                |   | .48       |           |  |      | .36       |           |      |   | .27       |          
|                                           









TABLE 2: RECONCILIATION OF LOAN RECEIVABLES TO MANAGED
LOANS (dollars in
thousands)


|                        |                               |                     |      |            |             |      |   |            |             |  |   |            |             | 
|----------------------- | ----------------------------- | ------------------- | ---- | ---------- | ----------- | ---- | - | ---------- | ----------- |  | - | ---------- | ----------- | 
|Year Ended December 31, |                               |                     | 2004 |            |             | 2003 |   |            | 2002        | 
|                       
|                       
|At Year End:            |                               |                     |      |            |             |      |   |            |             |  |   |           
|                        | Loans held for securitization |                     | $    | 8,239,487  |             |      | $ | 13,084,105 |             |  | $ | 11,029,627 |            
|                        | Loan portfolio                |                     |      | 25,519,363 |             |      |   | 20,539,972 |             |  |   | 17,696,881 |            
|                        |                               |                     |      |            |             |      |   |            |            
|                        |                               | Loan receivables    |      |            | 33,758,850  |      |   |            | 33,624,077  |  |   |            | 28,726,508  | 
|                        | Securitized loans             |                     |      | 87,859,325 |             |      |   | 84,869,483 |             |  |   | 78,531,334 |            
|                        |                               |                     |      |            |             |      |   |            |            
|                        |                               | Total managed loans |      | $          | 121,618,175 |      |   | $          | 118,493,560 |  |   | $          | 107,257,842 | 
|                        |                               |                     |      |            |             |      |   |            |            
|                       
|Average for the Year:   |                               |                     |      |            |             |      |   |            |             |  |   |           
|                        | Loans held for securitization |                     | $    | 8,893,754  |             |      | $ | 9,198,810  |             |  | $ | 8,130,207  |            
|                        | Loan portfolio                |                     |      | 22,162,033 |             |      |   | 18,985,008 |             |  |   | 17,184,993 |            
|                        |                               |                     |      |            |             |      |   |            |            
|                        |                               | Loan receivables    |      |            | 31,055,787  |      |   |            | 28,183,818  |  |   |            | 25,315,200  | 
|                        | Securitized loans             |                     |      | 87,040,251 |             |      |   | 81,691,156 |             |  |   | 74,718,731 |            
|                        |                               |                     |      |            |             |      |   |            |            
|                        |                               | Total managed loans |      | $          | 118,096,038 |      |   | $          | 109,874,974 |  |   | $          | 100,033,931 | 
|                        |                               |                     |      |            |             |      |   |            |            
|                       







---



##### 






NET INTEREST INCOME


TABLE 3: RECONCILIATION OF THE AS REPORTED RETURN ON AVERAGE
TOTAL ASSETS AND STOCKHOLDERS EQUITY TO THE RETURN ON
AVERAGE TOTAL ASSETS AND STOCKHOLDERS EQUITY EXCLUDING THE
CHANGE IN THE ESTIMATED VALUE OF ACCRUED INTEREST AND FEES IN
2002 (dollars in
thousands)


|                                                                                     |  |                 |            |  |       |  |       |            |  |   |           | 
|------------------------------------------------------------------------------------ |  | --------------- | ---------- |  | ----- |  | ----- | ---------- |  | - | --------- | 
|Year Ended December 31, 2002                                                         |  |                 |            |  |       | 
|                                                                                     | 
|                                                                                     |  | Average Balance |            |  | Ratio |  |       | Net Income | 
|                                                                                     |  |                 |           
|Return on Average Total Assets                                                       |  |                 |            |  |       |  |       |            |  |   |           | 
|As reported                                                                          |  | $               | 48,154,027 |  |       |  | 3.67  | %          |  | $ | 1,765,954 | 
|Impact of the change in the estimated value of accrued interest
    and fees in 2002 |  |                 | 67,182     |  |       |  |       |            |  |   | 167,167   | 
|                                                                                     |  |                 |            |  |       |  |       |            | 
|Excluding the change in the estimated value of accrued interest
    and fees in 2002 |  | $               | 48,221,209 |  |       |  | 4.01  |            |  | $ | 1,933,121 | 
|                                                                                     |  |                 |            |  |       |  |       |            | 
|Return on Average Stockholders Equity                                               |  |                 |            |  |       |  |       |            |  |   |           | 
|As reported                                                                          |  | $               | 8,293,823  |  |       |  | 21.29 |            |  | $ | 1,765,954 | 
|Impact of the change in the estimated value of accrued interest
    and fees in 2002 |  |                 | 42,593     |  |       |  |       |            |  |   | 167,167   | 
|                                                                                     |  |                 |            |  |       |  |       |            | 
|Excluding the change in the estimated value of accrued interest
    and fees in 2002 |  | $               | 8,336,416  |  |       |  | 23.19 |            |  | $ | 1,933,121 | 
|                                                                                     |  |                 |            |  |       |  |       |            | 
|                                                                                    









---



##### 



TABLE 4: STATEMENTS OF AVERAGE BALANCES, YIELDS AND RATES,
INCOME OR EXPENSE


(dollars in thousands, yields and rates on a fully taxable
equivalent basis)


|                                     |                                       |                                                |                                       |                                          |                                                     |            |            |            |      |      |         |         |        |         |            |           |           |            |            |            |      |      |        |         |        |           |           |           |           |            |            |            |      |      |       |         |        |           |           |           | 
|------------------------------------ | ------------------------------------- | ---------------------------------------------- | ------------------------------------- | ---------------------------------------- | --------------------------------------------------- | ---------- | ---------- | ---------- | ---- | ---- | ------- | ------- | ------ | ------- | ---------- | --------- | --------- | ---------- | ---------- | ---------- | ---- | ---- | ------ | ------- | ------ | --------- | --------- | --------- | --------- | ---------- | ---------- | ---------- | ---- | ---- | ----- | ------- | ------ | --------- | --------- | --------- | 
|Year Ended December 31,              |                                       |                                                | 2004                                  |                                          |                                                     | 2003       |            |            | 2002 |     
|                                     |                                      
|                                     |                                       | Average                                        |                                       |                                          | Yield/                                              |            |            | Income or  |      |      | Average |         |        | Yield/  |            |           | Income or |            |            | Average    |      |      | Yield/ |         |        | Income or |          
|                                     |                                       | Balance                                        |                                       |                                          | Rate                                                |            |            | Expense    |      |      | Balance |         |        | Rate    |            |           | Expense   |            |            | Balance    |      |      | Rate   |         |        | Expense   |          
|                                     |                                       |                                                |                                      
|Assets                               |                                       |                                                |                                       |                                          |                                                     |            |            |            |      |      |         |         |        |         |            |           |           |            |            |            |      |      |        |         |        |           |           |           |           |            |            |            |      |      |       |        
|Interest-earning assets:             |                                       |                                                |                                       |                                          |                                                     |            |            |            |      |      |         |         |        |         |            |           |           |            |            |            |      |      |        |         |        |           |           |           |           |            |            |            |      |      |       |        
|                                     | Money market instruments:             |                                                |                                       |                                          |                                                     |            |            |            |      |      |         |         |        |         |            |           |           |            |            |            |      |      |        |         |        |           |           |           |           |            |            |            |      |      |       |         |       
|                                     |                                       | Interest-earning time deposits in other banks: |                                       |                                          |                                                     |            |            |            |      |      |         |         |        |         |            |           |           |            |            |            |      |      |        |         |        |           |           |           |           |            |            |            |      |      |       |         |        |          
|                                     |                                       |                                                | Domestic                              |                                          | $                                                   | 114,294    |            |            |      | .99  | %       |         | $      | 1,135   |            |           | $         | 8,181      |            |            |      | 1.91 | %      |         | $      | 156       |           |           | $         | 1,244      |            |            |      | .96  | %     |         | $      | 12        |          
|                                     |                                       |                                                | Foreign                               |                                          |                                                     | 4,647,115  |            |            |      | 2.19 |         |         |        | 101,762 |            |           |           | 4,629,799  |            |            |      | 1.71 |        |         |        | 79,103    |           |           |           | 2,149,065  |            |            |      | 2.47 |       |         |        | 53,121    |          
|                                     |                                       |                                                |                                       |                                          |                                                     |            |            |            |      |      |         |         |        |         |            |           |           |            |            |            |      |      |        |         |        |           |          
|                                     |                                       |                                                |                                       |                                          | Total interest-earning time deposits in other banks |            |            | 4,761,409  |      |      |         | 2.16    |        |         |            | 102,897   |           |            |            | 4,637,980  |      |      |        | 1.71    |        |           |           | 79,259    |           |            |            | 2,150,309  |      |      |       | 2.47    |        |           |           | 53,133    | 
|                                     |                                       | Federal funds sold                             |                                       |                                          | 2,115,679                                           |            |            |            | 1.33 |      |         |         | 28,112 |         |            |           | 2,957,819 |            |            |            | 1.12 |      |        |         | 33,137 |           |           |           | 2,127,914 |            |            |            | 1.67 |      |       |         | 35,460 |          
|                                     |                                       |                                                |                                       |                                          |                                                     |            |            |            |      |      |         |         |        |         |            |           |           |            |            |            |      |      |        |         |        |           |          
|                                     |                                       |                                                |                                       |                                          | Total money market instruments                      |            |            | 6,877,088  |      |      |         | 1.91    |        |         |            | 131,009   |           |            |            | 7,595,799  |      |      |        | 1.48    |        |           |           | 112,396   |           |            |            | 4,278,223  |      |      |       | 2.07    |        |           |           | 88,593    | 
|                                     | Investment securities (a):            |                                                |                                       |                                          |                                                     |            |            |            |      |      |         |         |        |         |            |           |           |            |            |            |      |      |        |         |        |           |           |           |           |            |            |            |      |      |       |         |       
|                                     |                                       | Domestic:                                      |                                       |                                          |                                                     |            |            |            |      |      |         |         |        |         |            |           |           |            |            |            |      |      |        |         |        |           |           |           |           |            |            |            |      |      |       |         |        |          
|                                     |                                       |                                                | Taxable                               |                                          |                                                     | 4,902,078  |            |            |      | 2.17 |         |         |        | 106,448 |            |           |           | 3,722,062  |            |            |      | 2.67 |        |         |        | 99,223    |           |           |           | 3,688,047  |            |            |      | 3.42 |       |         |        | 126,062   |          
|                                     |                                       |                                                | Tax-exempt (b)                        |                                          |                                                     | 111,439    |            |            |      | 2.29 |         |         |        | 2,548   |            |           |           | 109,403    |            |            |      | 1.99 |        |         |        | 2,176     |           |           |           | 110,054    |            |            |      | 2.69 |       |         |        | 2,965     |          
|                                     |                                       |                                                |                                       |                                          |                                                     |            |            |            |      |      |         |         |        |         |            |           |           |            |            |            |      |      |        |         |        |           |          
|                                     |                                       |                                                |                                       |                                          | Total domestic investment securities                |            |            | 5,013,517  |      |      |         | 2.17    |        |         |            | 108,996   |           |            |            | 3,831,465  |      |      |        | 2.65    |        |           |           | 101,399   |           |            |            | 3,798,101  |      |      |       | 3.40    |        |           |           | 129,027   | 
|                                     |                                       | Foreign                                        |                                       |                                          | 555,829                                             |            |            |            | 3.97 |      |         |         | 22,080 |         |            |           | 266,286   |            |            |            | 4.19 |      |        |         | 11,147 |           |           |           | 181,514   |            |            |            | 4.60 |      |       |         | 8,349  |          
|                                     |                                       |                                                |                                       |                                          |                                                     |            |            |            |      |      |         |         |        |         |            |           |           |            |            |            |      |      |        |         |        |           |          
|                                     |                                       |                                                |                                       |                                          | Total investment securities                         |            |            | 5,569,346  |      |      |         | 2.35    |        |         |            | 131,076   |           |            |            | 4,097,751  |      |      |        | 2.75    |        |           |           | 112,546   |           |            |            | 3,979,615  |      |      |       | 3.45    |        |           |           | 137,376   | 
|                                     | Other interest-earning assets (a) (c) |                                                |                                       | 4,120,645                                |                                                     |            |            | 7.67       |      |      |         | 315,901 |        |         |            | 3,904,013 |           |            |            | 7.82       |      |      |        | 305,468 |        |           |           | 3,869,893 |           |            |            | 9.28       |      |      |       | 359,159 |       
|                                     | Loan receivables:                     |                                                |                                       |                                          |                                                     |            |            |            |      |      |         |         |        |         |            |           |           |            |            |            |      |      |        |         |        |           |           |           |           |            |            |            |      |      |       |         |       
|                                     |                                       | Loans held for securitization:                 |                                       |                                          |                                                     |            |            |            |      |      |         |         |        |         |            |           |           |            |            |            |      |      |        |         |        |           |           |           |           |            |            |            |      |      |       |         |        |          
|                                     |                                       |                                                | Domestic (d):                         |                                          |                                                     |            |            |            |      |      |         |         |        |         |            |           |           |            |            |            |      |      |        |         |        |           |           |           |           |            |            |            |      |      |       |         |        |           |          
|                                     |                                       |                                                |                                       | Credit card                              |                                                     |            | 6,748,927  |            |      |      | 11.94   |         |        |         | 805,822    |           |           |            | 6,856,270  |            |      |      | 12.47  |         |        |           | 854,977   |           |           |            | 5,993,515  |            |      |      | 13.11 |         |        |           | 785,750   |          
|                                     |                                       |                                                |                                       | Other consumer                           |                                                     |            | 38,938     |            |      |      | 5.86    |         |        |         | 2,280      |           |           |            | 52,883     |            |      |      | 5.35   |         |        |           | 2,827     |           |           |            | 438,187    |            |      |      | 15.30 |         |        |           | 67,062    |          
|                                     |                                       |                                                |                                       | Commercial                               |                                                     |            | 898        |            |      |      | 9.13    |         |        |         | 82         |           |           |            | 287,420    |            |      |      | 9.11   |         |        |           | 26,184    |           |           |            | 318,289    |            |      |      | 8.73  |         |        |           | 27,786    |          
|                                     |                                       |                                                |                                       |                                          |                                                     |            |            |            |      |      |         |         |        |         |            |           |           |            |            |            |      |      |        |         |        |           |          
|                                     |                                       |                                                |                                       |                                          | Total domestic loans held for securitization        |            |            | 6,788,763  |      |      |         | 11.90   |        |         |            | 808,184   |           |            |            | 7,196,573  |      |      |        | 12.28   |        |           |           | 883,988   |           |            |            | 6,749,991  |      |      |       | 13.05   |        |           |           | 880,598   | 
|                                     |                                       |                                                | Foreign (d):                          |                                          |                                                     |            |            |            |      |      |         |         |        |         |            |           |           |            |            |            |      |      |        |         |        |           |           |           |           |            |            |            |      |      |       |         |        |           |          
|                                     |                                       |                                                |                                       | Credit card                              |                                                     |            | 2,104,991  |            |      |      | 12.20   |         |        |         | 256,821    |           |           |            | 2,002,237  |            |      |      | 11.44  |         |        |           | 228,989   |           |           |            | 1,380,216  |            |      |      | 12.75 |         |        |           | 175,960   |          
|                                     |                                       |                                                |                                       | Other consumer                           |                                                     |            |           |            |      |      |        |         |        |         |           |           |           |            |           |            |      |      |       |         |        |           |          |           |           |            |           |            |      |      |      |         |        |           |          |          
|                                     |                                       |                                                |                                       | Commercial                               |                                                     |            |           |            |      |      |        |         |        |         |           |           |           |            |           |            |      |      |       |         |        |           |          |           |           |            |           |            |      |      |      |         |        |           |          |          
|                                     |                                       |                                                |                                       |                                          |                                                     |            |            |            |      |      |         |         |        |         |            |           |           |            |            |            |      |      |        |         |        |           |          
|                                     |                                       |                                                |                                       |                                          | Total foreign loans held for securitization         |            |            | 2,104,991  |      |      |         | 12.20   |        |         |            | 256,821   |           |            |            | 2,002,237  |      |      |        | 11.44   |        |           |           | 228,989   |           |            |            | 1,380,216  |      |      |       | 12.75   |        |           |           | 175,960   | 
|                                     |                                       |                                                |                                       |                                          |                                                     |            |            |            |      |      |         |         |        |         |            |           |           |            |            |            |      |      |        |         |        |           |          
|                                     |                                       |                                                |                                       |                                          | Total loans held for securitization                 |            |            | 8,893,754  |      |      |         | 11.97   |        |         |            | 1,065,005 |           |            |            | 9,198,810  |      |      |        | 12.10   |        |           |           | 1,112,977 |           |            |            | 8,130,207  |      |      |       | 13.00   |        |           |           | 1,056,558 | 
|                                     |                                       | Loan portfolio (c):                            |                                       |                                          |                                                     |            |            |            |      |      |         |         |        |         |            |           |           |            |            |            |      |      |        |         |        |           |           |           |           |            |            |            |      |      |       |         |        |          
|                                     |                                       |                                                | Domestic (d):                         |                                          |                                                     |            |            |            |      |      |         |         |        |         |            |           |           |            |            |            |      |      |        |         |        |           |           |           |           |            |            |            |      |      |       |         |        |           |          
|                                     |                                       |                                                |                                       | Credit card                              |                                                     |            | 6,963,880  |            |      |      | 11.02   |         |        |         | 767,487    |           |           |            | 6,777,071  |            |      |      | 10.93  |         |        |           | 740,706   |           |           |            | 6,376,147  |            |      |      | 11.04 |         |        |           | 704,026   |          
|                                     |                                       |                                                |                                       | Other consumer                           |                                                     |            | 5,554,193  |            |      |      | 13.73   |         |        |         | 762,821    |           |           |            | 6,051,906  |            |      |      | 13.96  |         |        |           | 845,040   |           |           |            | 5,753,784  |            |      |      | 13.86 |         |        |           | 797,694   |          
|                                     |                                       |                                                |                                       | Commercial                               |                                                     |            | 2,189,197  |            |      |      | 8.14    |         |        |         | 178,108    |           |           |            | 746,662    |            |      |      | 7.97   |         |        |           | 59,489    |           |           |            | 1,034,703  |            |      |      | 7.66  |         |        |           | 79,231    |          
|                                     |                                       |                                                |                                       |                                          |                                                     |            |            |            |      |      |         |         |        |         |            |           |           |            |            |            |      |      |        |         |        |           |          
|                                     |                                       |                                                |                                       |                                          | Total domestic loan portfolio                       |            |            | 14,707,270 |      |      |         | 11.62   |        |         |            | 1,708,416 |           |            |            | 13,575,639 |      |      |        | 12.12   |        |           |           | 1,645,235 |           |            |            | 13,164,634 |      |      |       | 12.01   |        |           |           | 1,580,951 | 
|                                     |                                       |                                                | Foreign (d):                          |                                          |                                                     |            |            |            |      |      |         |         |        |         |            |           |           |            |            |            |      |      |        |         |        |           |           |           |           |            |            |            |      |      |       |         |        |           |          
|                                     |                                       |                                                |                                       | Credit card                              |                                                     |            | 3,361,840  |            |      |      | 10.40   |         |        |         | 349,616    |           |           |            | 3,294,636  |            |      |      | 11.22  |         |        |           | 369,791   |           |           |            | 2,402,517  |            |      |      | 12.16 |         |        |           | 292,140   |          
|                                     |                                       |                                                |                                       | Other consumer                           |                                                     |            | 3,027,292  |            |      |      | 9.27    |         |        |         | 280,675    |           |           |            | 2,097,784  |            |      |      | 9.54   |         |        |           | 200,152   |           |           |            | 1,617,842  |            |      |      | 10.16 |         |        |           | 164,363   |          
|                                     |                                       |                                                |                                       | Commercial                               |                                                     |            | 1,065,631  |            |      |      | 8.25    |         |        |         | 87,910     |           |           |            | 16,949     |            |      |      | 6.36   |         |        |           | 1,078     |           |           |            |           |            |      |      |      |         |        |           |          |          
|                                     |                                       |                                                |                                       |                                          |                                                     |            |            |            |      |      |         |         |        |         |            |           |           |            |            |            |      |      |        |         |        |           |          
|                                     |                                       |                                                |                                       |                                          | Total foreign loan portfolio                        |            |            | 7,454,763  |      |      |         | 9.63    |        |         |            | 718,201   |           |            |            | 5,409,369  |      |      |        | 10.56   |        |           |           | 571,021   |           |            |            | 4,020,359  |      |      |       | 11.35   |        |           |           | 456,503   | 
|                                     |                                       |                                                |                                       |                                          |                                                     |            |            |            |      |      |         |         |        |         |            |           |           |            |            |            |      |      |        |         |        |           |          
|                                     |                                       |                                                |                                       |                                          | Total loan portfolio                                |            |            | 22,162,033 |      |      |         | 10.95   |        |         |            | 2,426,617 |           |            |            | 18,985,008 |      |      |        | 11.67   |        |           |           | 2,216,256 |           |            |            | 17,184,993 |      |      |       | 11.86   |        |           |           | 2,037,454 | 
|                                     |                                       |                                                |                                       |                                          |                                                     |            |            |            |      |      |         |         |        |         |            |           |           |            |            |            |      |      |        |         |        |           |          
|                                     |                                       |                                                |                                       |                                          | Total loan receivables                              |            |            | 31,055,787 |      |      |         | 11.24   |        |         |            | 3,491,622 |           |            |            | 28,183,818 |      |      |        | 11.81   |        |           |           | 3,329,233 |           |            |            | 25,315,200 |      |      |       | 12.22   |        |           |           | 3,094,012 | 
|                                     |                                       |                                                |                                       |                                          |                                                     |            |            |            |      |      |         |         |        |         |            |           |           |            |            |            |      |      |        |         |        |           |          
|                                     |                                       |                                                |                                       |                                          | Total interest-earning assets                       |            |            | 47,622,866 |      |      |         | 8.55    |        |         |            | 4,069,608 |           |            |            | 43,781,381 |      |      |        | 8.82    |        |           |           | 3,859,643 |           |            |            | 37,442,931 |      |      |       | 9.83    |        |           |           | 3,679,140 | 
|Cash and due from banks              |                                       |                                                | 908,015                               |                                          |                                                     |            |            |            |      |      |         |         |        |         | 781,507    |           |           |            |            |            |      |      |        |         |        |           | 766,003   |           |           |            |            |            |      |      |       |        
|Premises and equipment, net          |                                       |                                                | 2,719,263                             |                                          |                                                     |            |            |            |      |      |         |         |        |         | 2,576,437  |           |           |            |            |            |      |      |        |         |        |           | 2,434,161 |           |           |            |            |            |      |      |       |        
|Other assets (c)                     |                                       |                                                | 10,909,175                            |                                          |                                                     |            |            |            |      |      |         |         |        |         | 10,252,088 |           |           |            |            |            |      |      |        |         |        |           | 8,452,712 |           |           |            |            |            |      |      |       |        
|Reserve for possible credit losses   |                                       |                                                | (1,206,631                            | )                                        |                                                     |            |            |            |      |      |         |         |        |         | (1,158,510 | )         |           |            |            |            |      |      |        |         |        |           | (941,780  | )         |           |            |            |            |      |      |       |        
|                                     |                                       |                                                |                                       |                                          |                                                     |            |            |            |      |      |         |         |        |         |            |           |           |            |            |            |      |      |        |         |        |           |          
|                                     |                                       |                                                |                                       |                                          | Total assets                                        |            | $          | 60,952,688 |      |      |         |         |        |         |            |           |           |            | $          | 56,232,903 |      |      |        |         |        |           |           |           |           |            | $          | 48,154,027 |      |      |       |         |        |           |           |           | 
|                                     |                                       |                                                |                                       |                                          |                                                     |            |            |            |      |      |         |         |        |         |            |           |           |            |            |            |      |      |        |         |        |           |          
|Liabilities and Stockholders Equity |                                       |                                                |                                       |                                          |                                                     |            |            |            |      |      |         |         |        |         |            |           |           |            |            |            |      |      |        |         |        |           |           |           |           |            |            |            |      |      |       |        
|Interest-bearing liabilities:        |                                       |                                                |                                       |                                          |                                                     |            |            |            |      |      |         |         |        |         |            |           |           |            |            |            |      |      |        |         |        |           |           |           |           |            |            |            |      |      |       |        
|                                     | Interest-bearing deposits:            |                                                |                                       |                                          |                                                     |            |            |            |      |      |         |         |        |         |            |           |           |            |            |            |      |      |        |         |        |           |           |           |           |            |            |            |      |      |       |         |       
|                                     |                                       | Domestic:                                      |                                       |                                          |                                                     |            |            |            |      |      |         |         |        |         |            |           |           |            |            |            |      |      |        |         |        |           |           |           |           |            |            |            |      |      |       |         |        |          
|                                     |                                       |                                                | Time deposits                         |                                          | $                                                   | 20,849,344 |            |            |      | 3.98 |         |         |        | 830,174 |            |           | $         | 21,472,666 |            |            |      | 4.39 |        |         |        | 942,296   |           |           | $         | 19,485,060 |            |            |      | 5.28 |       |         |        | 1,027,905 |          
|                                     |                                       |                                                | Money market deposit accounts         |                                          |                                                     | 7,436,962  |            |            |      | 1.62 |         |         |        | 120,783 |            |           |           | 7,844,120  |            |            |      | 1.80 |        |         |        | 141,117   |           |           |           | 7,040,563  |            |            |      | 2.70 |       |         |        | 190,072   |          
|                                     |                                       |                                                | Interest-bearing transaction accounts |                                          |                                                     | 49,826     |            |            |      | .92  |         |         |        | 458     |            |           |           | 50,369     |            |            |      | 1.07 |        |         |        | 538       |           |           |           | 47,157     |            |            |      | 1.71 |       |         |        | 808       |          
|                                     |                                       |                                                | Savings accounts                      |                                          |                                                     | 86,592     |            |            |      | 1.43 |         |         |        | 1,235   |            |           |           | 82,088     |            |            |      | 1.18 |        |         |        | 967       |           |           |           | 74,839     |            |            |      | 1.74 |       |         |        | 1,302     |          
|                                     |                                       |                                                |                                       |                                          |                                                     |            |            |            |      |      |         |         |        |         |            |           |           |            |            |            |      |      |        |         |        |           |          
|                                     |                                       |                                                |                                       | Total domestic interest-bearing deposits |                                                     |            | 28,422,724 |            |      |      | 3.35    |         |        |         | 952,650    |           |           |            | 29,449,243 |            |      |      | 3.68   |         |        |           | 1,084,918 |           |           |            | 26,647,619 |            |      |      | 4.58  |         |        |           | 1,220,087 |          
|                                     |                                       | Foreign:                                       |                                       |                                          |                                                     |            |            |            |      |      |         |         |        |         |            |           |           |            |            |            |      |      |        |         |        |           |           |           |           |            |            |            |      |      |       |         |        |          
|                                     |                                       |                                                | Time deposits                         |                                          |                                                     | 818,149    |            |            |      | 3.57 |         |         |        | 29,177  |            |           |           | 712,239    |            |            |      | 3.21 |        |         |        | 22,888    |           |           |           | 924,325    |            |            |      | 3.83 |       |         |        | 35,440    |          
|                                     |                                       |                                                |                                       |                                          |                                                     |            |            |            |      |      |         |         |        |         |            |           |           |            |            |            |      |      |        |         |        |           |          
|                                     |                                       |                                                |                                       |                                          | Total interest-bearing deposits                     |            |            | 29,240,873 |      |      |         | 3.36    |        |         |            | 981,827   |           |            |            | 30,161,482 |      |      |        | 3.67    |        |           |           | 1,107,806 |           |            |            | 27,571,944 |      |      |       | 4.55    |        |           |           | 1,255,527 | 
|                                     | Borrowed funds:                       |                                                |                                       |                                          |                                                     |            |            |            |      |      |         |         |        |         |            |           |           |            |            |            |      |      |        |         |        |           |           |           |           |            |            |            |      |      |       |         |       
|                                     |                                       | Short-term borrowings:                         |                                       |                                          |                                                     |            |            |            |      |      |         |         |        |         |            |           |           |            |            |            |      |      |        |         |        |           |           |           |           |            |            |            |      |      |       |         |        |          
|                                     |                                       |                                                | Domestic                              |                                          |                                                     | 900,549    |            |            |      | 3.48 |         |         |        | 31,356  |            |           |           | 988,533    |            |            |      | 3.46 |        |         |        | 34,185    |           |           |           | 1,037,403  |            |            |      | 3.57 |       |         |        | 37,051    |          
|                                     |                                       |                                                | Foreign                               |                                          |                                                     | 1,022,515  |            |            |      | 4.46 |         |         |        | 45,554  |            |           |           | 153,421    |            |            |      | 3.22 |        |         |        | 4,947     |           |           |           | 215,718    |            |            |      | 2.75 |       |         |        | 5,927     |          
|                                     |                                       |                                                |                                       |                                          |                                                     |            |            |            |      |      |         |         |        |         |            |           |           |            |            |            |      |      |        |         |        |           |          
|                                     |                                       |                                                |                                       |                                          | Total short-term borrowings                         |            |            | 1,923,064  |      |      |         | 4.00    |        |         |            | 76,910    |           |            |            | 1,141,954  |      |      |        | 3.43    |        |           |           | 39,132    |           |            |            | 1,253,121  |      |      |       | 3.43    |        |           |           | 42,978    | 
|                                     |                                       | Long-term debt and bank notes (e):             |                                       |                                          |                                                     |            |            |            |      |      |         |         |        |         |            |           |           |            |            |            |      |      |        |         |        |           |           |           |           |            |            |            |      |      |       |         |        |          
|                                     |                                       |                                                | Domestic                              |                                          |                                                     | 7,644,963  |            |            |      | 2.93 |         |         |        | 224,068 |            |           |           | 7,291,420  |            |            |      | 2.50 |        |         |        | 182,240   |           |           |           | 5,696,163  |            |            |      | 3.05 |       |         |        | 173,463   |          
|                                     |                                       |                                                | Foreign                               |                                          |                                                     | 4,070,447  |            |            |      | 6.12 |         |         |        | 249,013 |            |           |           | 3,266,173  |            |            |      | 5.49 |        |         |        | 179,333   |           |           |           | 2,344,256  |            |            |      | 5.61 |       |         |        | 131,527   |          
|                                     |                                       |                                                |                                       |                                          |                                                     |            |            |            |      |      |         |         |        |         |            |           |           |            |            |            |      |      |        |         |        |           |          
|                                     |                                       |                                                |                                       |                                          | Total long-term debt and bank notes                 |            |            | 11,715,410 |      |      |         | 4.04    |        |         |            | 473,081   |           |            |            | 10,557,593 |      |      |        | 3.42    |        |           |           | 361,573   |           |            |            | 8,040,419  |      |      |       | 3.79    |        |           |           | 304,990   | 
|                                     |                                       |                                                |                                       |                                          |                                                     |            |            |            |      |      |         |         |        |         |            |           |           |            |            |            |      |      |        |         |        |           |          
|                                     |                                       |                                                |                                       |                                          | Total borrowed funds                                |            |            | 13,638,474 |      |      |         | 4.03    |        |         |            | 549,991   |           |            |            | 11,699,547 |      |      |        | 3.42    |        |           |           | 400,705   |           |            |            | 9,293,540  |      |      |       | 3.74    |        |           |           | 347,968   | 
|                                     |                                       |                                                |                                       |                                          |                                                     |            |            |            |      |      |         |         |        |         |            |           |           |            |            |            |      |      |        |         |        |           |          
|                                     |                                       |                                                |                                       |                                          | Total interest-bearing liabilities                  |            |            | 42,879,347 |      |      |         | 3.57    |        |         |            | 1,531,818 |           |            |            | 41,861,029 |      |      |        | 3.60    |        |           |           | 1,508,511 |           |            |            | 36,865,484 |      |      |       | 4.35    |        |           |           | 1,603,495 | 
|Noninterest-bearing deposits         |                                       |                                                | 2,652,764                             |                                          |                                                     |            |            |            |      |      |         |         |        |         | 1,719,058  |           |           |            |            |            |      |      |        |         |        |           | 909,543   |           |           |            |            |            |      |      |       |        
|Other liabilities                    |                                       |                                                | 3,092,361                             |                                          |                                                     |            |            |            |      |      |         |         |        |         | 2,480,038  |           |           |            |            |            |      |      |        |         |        |           | 2,085,177 |           |           |            |            |            |      |      |       |        
|                                     |                                       |                                                |                                       |                                          |                                                     |            |            |            |      |      |         |         |        |         |            |           |           |            |            |            |      |      |        |         |        |           |          
|                                     |                                       |                                                |                                       |                                          | Total liabilities                                   |            |            | 48,624,472 |      |      |         |         |        |         |            |           |           |            |            | 46,060,125 |      |      |        |         |        |           |           |           |           |            |            | 39,860,204 |      |      |       |         |        |           |           |           | 
|Stockholders equity                 |                                       |                                                | 12,328,216                            |                                          |                                                     |            |            |            |      |      |         |         |        |         | 10,172,778 |           |           |            |            |            |      |      |        |         |        |           | 8,293,823 |           |           |            |            |            |      |      |       |        
|                                     |                                       |                                                |                                       |                                          |                                                     |            |            |            |      |      |         |         |        |         |            |           |           |            |            |            |      |      |        |         |        |           |          
|                                     |                                       |                                                |                                       |                                          | Total liabilities and stockholders equity          |            | $          | 60,952,688 |      |      |         |         |        |         |            |           |           |            | $          | 56,232,903 |      |      |        |         |        |           |           |           |           |            | $          | 48,154,027 |      |      |       |         |        |           |           |           | 
|                                     |                                       |                                                |                                       |                                          |                                                     |            |            |            |      |      |         |         |        |         |            |           |           |            |            |            |      |      |        |         |        |           |          
|                                     |                                       |                                                |                                       |                                          | Net interest income (c)                             |            |            |            |      |      |         |         |        |         | $          | 2,537,790 |           |            |            |            |      |      |        |         |        |           | $         | 2,351,132 |           |            |            |            |      |      |       |         |        |           | $         | 2,075,645 | 
|                                     |                                       |                                                |                                       |                                          |                                                     |            |            |            |      |      |         |         |        |         |            |           |           |            |            |            |      |      |        |         |        |           |          
|                                     |                                       |                                                |                                       |                                          | Net interest margin (c)                             |            |            |            |      |      |         | 5.33    |        |         |            |           |           |            |            |            |      |      |        | 5.37    |        |           |           |           |           |            |            |            |      |      |       | 5.54    |        |           |           |           | 
|                                     |                                       |                                                |                                       |                                          | Interest rate spread (c)                            |            |            |            |      |      |         | 4.98    |        |         |            |           |           |            |            |            |      |      |        | 5.22    |        |           |           |           |           |            |            |            |      |      |       | 5.48    |        |           |           |           | 
|                                    



|    |  |                                                                                                                                                                                                                                                                                                                                                                                                               
|--- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) |  | Average balances for investment securities available-for-sale
    and other interest-earning assets are based on market values or
    estimated market values; if these assets were carried at
    amortized cost, there would not be a material impact on the net
    interest margin.                                                                                                                       
|   
|(b) |  | The fully taxable equivalent adjustment for the years ended
    December 31, 2004, 2003, and 2002 was $989, $759, and
    $1,070, respectively.                                                                                                                                                                                                                                                               
|   
|(c) |  | December 31, 2002 includes the impact of the change in the
    estimated value of accrued interest and fees.                                                                                                                                                                                                                                                                                                  
|   
|(d) |  | The Corporation reclassified certain loan products to separately
    report its commercial loan products. Business card products were
    reclassified from credit card loans to commercial loans, and all
    other commercial loan products were reclassified from other
    consumer loans to commercial loans. For purposes of
    comparability, certain prior period amounts have been
    reclassified.
|   
|(e) |  | Includes the impact of interest rate swap agreements and foreign
    exchange swap agreements used to change a portion of fixed-rate
    funding sources to floating-rate funding sources.                                                                                                                                                                                                                    







---



##### 



TABLE 5: RATE-VOLUME VARIANCE ANALYSIS
(a) (dollars in
thousands, on a fully taxable equivalent basis)


|                                  |                                                |                                       |                |                                                     |                       |         |         |          |         |         |         |        |          |         |          |        |          |         |         |         |          |         |          |        |         |         |          |  
|--------------------------------- | ---------------------------------------------- | ------------------------------------- | -------------- | --------------------------------------------------- | --------------------- | ------- | ------- | -------- | ------- | ------- | ------- | ------ | -------- | ------- | -------- | ------ | -------- | ------- | ------- | ------- | -------- | ------- | -------- | ------ | ------- | ------- | -------- | -
|Year Ended December 31,           |                                                | 2004 Compared to 2003                 |                |                                                     | 2003 Compared to 2002 |        
|                                  |                                               
|                                  |                                                | Volume                                |                |                                                     | Rate                  |         |         | Variance |         |         | Volume  |        |          | Rate    |          |        | Variance |        
|                                  |                                                |                                       |               
|Interest-Earning Assets           |                                                |                                       |                |                                                     |                       |         |         |          |         |         |         |        |          |         |          |        |          |         |         |         |          |         |          |       
|Money market instruments:         |                                                |                                       |                |                                                     |                       |         |         |          |         |         |         |        |          |         |          |        |          |         |         |         |          |         |          |       
|                                  | Interest-earning time deposits in other banks: |                                       |                |                                                     |                       |         |         |          |         |         |         |        |          |         |          |        |          |         |         |         |          |         |          |        |        
|                                  |                                                | Domestic                              |                | $                                                   | 1,088                 |         |         | $        | (109    | )       |         | $      | 979      |         |          | $      | 123      |         |         | $       | 21       |         |          | $      | 144     |        
|                                  |                                                | Foreign                               |                |                                                     | 297                   |         |         |          | 22,362  |         |         |        | 22,659   |         |          |        | 46,381   |         |         |         | (20,399  | )       |          |        | 25,982  |        
|                                  |                                                |                                       |                |                                                     |                       |         |         |          |         |         |         |        |          |         |          |        |          |        
|                                  |                                                |                                       |                | Total interest-earning time deposits in other banks |                       |         | 1,385   |          |         |         | 22,253  |        |          |         | 23,638   |        |          |         | 46,504  |         |          |         | (20,378  | )      |         |         | 26,126   |  
|                                  | Federal funds sold                             |                                       |                | (10,496                                             | )                     |         |         | 5,471    |         |         |         | (5,025 | )        |         |          | 11,367 |          |         |         | (13,690 | )        |         |          | (2,323 | )      
|                                  |                                                |                                       |                |                                                     |                       |         |         |          |         |         |         |        |          |         |          |        |          |        
|                                  |                                                |                                       |                | Total money market instruments                      |                       |         | (9,111  | )        |         |         | 27,724  |        |          |         | 18,613   |        |          |         | 57,871  |         |          |         | (34,068  | )      |         |         | 23,803   |  
|Investment securities:            |                                                |                                       |                |                                                     |                       |         |         |          |         |         |         |        |          |         |          |        |          |         |         |         |          |         |          |       
|                                  | Domestic:                                      |                                       |                |                                                     |                       |         |         |          |         |         |         |        |          |         |          |        |          |         |         |         |          |         |          |        |        
|                                  |                                                | Taxable                               |                |                                                     | 27,777                |         |         |          | (20,552 | )       |         |        | 7,225    |         |          |        | 1,152    |         |         |         | (27,991  | )       |          |        | (26,839 | )      
|                                  |                                                | Tax-exempt                            |                |                                                     | 41                    |         |         |          | 331     |         |         |        | 372      |         |          |        | (17      | )       |         |         | (772     | )       |          |        | (789    | )      
|                                  |                                                |                                       |                |                                                     |                       |         |         |          |         |         |         |        |          |         |          |        |          |        
|                                  |                                                |                                       |                | Total domestic investment securities                |                       |         | 27,818  |          |         |         | (20,221 | )      |          |         | 7,597    |        |          |         | 1,135   |         |          |         | (28,763  | )      |         |         | (27,628  | )
|                                  | Foreign                                        |                                       |                | 11,530                                              |                       |         |         | (597     | )       |         |         | 10,933 |          |         |          | 3,605  |          |         |         | (807    | )        |         |          | 2,798  |        
|                                  |                                                |                                       |                |                                                     |                       |         |         |          |         |         |         |        |          |         |          |        |          |        
|                                  |                                                |                                       |                | Total investment securities                         |                       |         | 39,348  |          |         |         | (20,818 | )      |          |         | 18,530   |        |          |         | 4,740   |         |          |         | (29,570  | )      |         |         | (24,830  | )
|Other interest-earning assets (b) |                                                |                                       | 16,699         |                                                     |                       |         | (6,266  | )        |         |         | 10,433  |        |          |         | 3,140    |        |          |         | (56,831 | )       |          |         | (53,691  | )     
|Loan receivables:                 |                                                |                                       |                |                                                     |                       |         |         |          |         |         |         |        |          |         |          |        |          |         |         |         |          |         |          |       
|                                  | Loans held for securitization:                 |                                       |                |                                                     |                       |         |         |          |         |         |         |        |          |         |          |        |          |         |         |         |          |         |          |        |        
|                                  |                                                | Domestic (c):                         |                |                                                     |                       |         |         |          |         |         |         |        |          |         |          |        |          |         |         |         |          |         |          |        |         |        
|                                  |                                                |                                       | Credit card    |                                                     |                       | (13,233 | )       |          |         | (35,922 | )       |        |          | (49,155 | )        |        |          | 108,984 |         |         |          | (39,757 | )        |        |         | 69,227  |         
|                                  |                                                |                                       | Other consumer |                                                     |                       | (798    | )       |          |         | 251     |         |        |          | (547    | )        |        |          | (36,916 | )       |         |          | (27,319 | )        |        |         | (64,235 | )       
|                                  |                                                |                                       | Commercial     |                                                     |                       | (26,163 | )       |          |         | 61      |         |        |          | (26,102 | )        |        |          | (2,776  | )       |         |          | 1,174   |          |        |         | (1,602  | )       
|                                  |                                                |                                       |                |                                                     |                       |         |         |          |         |         |         |        |          |         |          |        |          |        
|                                  |                                                |                                       |                | Total domestic loans held for securitization        |                       |         | (40,194 | )        |         |         | (35,610 | )      |          |         | (75,804  | )      |          |         | 69,292  |         |          |         | (65,902  | )      |         |         | 3,390    |  
|                                  |                                                | Foreign (c):                          |                |                                                     |                       |         |         |          |         |         |         |        |          |         |          |        |          |         |         |         |          |         |          |        |         |        
|                                  |                                                |                                       | Credit card    |                                                     |                       | 12,093  |         |          |         | 15,739  |         |        |          | 27,832  |          |        |          | 72,656  |         |         |          | (19,627 | )        |        |         | 53,029  |         
|                                  |                                                |                                       | Other consumer |                                                     |                       |        |         |          |         |        |         |        |          |        |          |        |          |        |         |         |          |        |          |        |         |        |         
|                                  |                                                |                                       | Commercial     |                                                     |                       |        |         |          |         |        |         |        |          |        |          |        |          |        |         |         |          |        |          |        |         |        |         
|                                  |                                                |                                       |                |                                                     |                       |         |         |          |         |         |         |        |          |         |          |        |          |        
|                                  |                                                |                                       |                | Total foreign loans held for securitization         |                       |         | 12,093  |          |         |         | 15,739  |        |          |         | 27,832   |        |          |         | 72,656  |         |          |         | (19,627  | )      |         |         | 53,029   |  
|                                  |                                                |                                       |                |                                                     |                       |         |         |          |         |         |         |        |          |         |          |        |          |        
|                                  |                                                |                                       |                | Total loans held for securitization                 |                       |         | (28,101 | )        |         |         | (19,871 | )      |          |         | (47,972  | )      |          |         | 141,948 |         |          |         | (85,529  | )      |         |         | 56,419   |  
|                                  | Loan portfolio (b):                            |                                       |                |                                                     |                       |         |         |          |         |         |         |        |          |         |          |        |          |         |         |         |          |         |          |        |        
|                                  |                                                | Domestic (c):                         |                |                                                     |                       |         |         |          |         |         |         |        |          |         |          |        |          |         |         |         |          |         |          |        |         |        
|                                  |                                                |                                       | Credit card    |                                                     |                       | 20,548  |         |          |         | 6,233   |         |        |          | 26,781  |          |        |          | 43,882  |         |         |          | (7,202  | )        |        |         | 36,680  |         
|                                  |                                                |                                       | Other consumer |                                                     |                       | (68,546 | )       |          |         | (13,673 | )       |        |          | (82,219 | )        |        |          | 41,591  |         |         |          | 5,755   |          |        |         | 47,346  |         
|                                  |                                                |                                       | Commercial     |                                                     |                       | 117,335 |         |          |         | 1,284   |         |        |          | 118,619 |          |        |          | (22,836 | )       |         |          | 3,094   |          |        |         | (19,742 | )       
|                                  |                                                |                                       |                |                                                     |                       |         |         |          |         |         |         |        |          |         |          |        |          |        
|                                  |                                                |                                       |                | Total domestic loan portfolio                       |                       |         | 69,337  |          |         |         | (6,156  | )      |          |         | 63,181   |        |          |         | 62,637  |         |          |         | 1,647    |        |         |         | 64,284   |  
|                                  |                                                | Foreign (c):                          |                |                                                     |                       |         |         |          |         |         |         |        |          |         |          |        |          |         |         |         |          |         |          |        |         |        
|                                  |                                                |                                       | Credit card    |                                                     |                       | 7,423   |         |          |         | (27,598 | )       |        |          | (20,175 | )        |        |          | 101,565 |         |         |          | (23,914 | )        |        |         | 77,651  |         
|                                  |                                                |                                       | Other consumer |                                                     |                       | 86,329  |         |          |         | (5,806  | )       |        |          | 80,523  |          |        |          | 46,297  |         |         |          | (10,508 | )        |        |         | 35,789  |         
|                                  |                                                |                                       | Commercial     |                                                     |                       | 86,417  |         |          |         | 415     |         |        |          | 86,832  |          |        |          | 1,078   |         |         |          |        |          |        |         | 1,078   |         
|                                  |                                                |                                       |                |                                                     |                       |         |         |          |         |         |         |        |          |         |          |        |          |        
|                                  |                                                |                                       |                | Total foreign loan portfolio                        |                       |         | 180,169 |          |         |         | (32,989 | )      |          |         | 147,180  |        |          |         | 148,940 |         |          |         | (34,422  | )      |         |         | 114,518  |  
|                                  |                                                |                                       |                |                                                     |                       |         |         |          |         |         |         |        |          |         |          |        |          |        
|                                  |                                                |                                       |                | Total loan portfolio                                |                       |         | 249,506 |          |         |         | (39,145 | )      |          |         | 210,361  |        |          |         | 211,577 |         |          |         | (32,775  | )      |         |         | 178,802  |  
|                                  |                                                |                                       |                |                                                     |                       |         |         |          |         |         |         |        |          |         |          |        |          |        
|                                  |                                                |                                       |                | Total loan receivables                              |                       |         | 221,405 |          |         |         | (59,016 | )      |          |         | 162,389  |        |          |         | 353,525 |         |          |         | (118,304 | )      |         |         | 235,221  |  
|                                  |                                                |                                       |                |                                                     |                       |         |         |          |         |         |         |        |          |         |          |        |          |        
|                                  |                                                |                                       |                | Total interest income (b)                           |                       |         | 268,341 |          |         |         | (58,376 | )      |          |         | 209,965  |        |          |         | 419,276 |         |          |         | (238,773 | )      |         |         | 180,503  |  
|Interest-Bearing Liabilities      |                                                |                                       |                |                                                     |                       |         |         |          |         |         |         |        |          |         |          |        |          |         |         |         |          |         |          |       
|Interest-bearing deposits:        |                                                |                                       |                |                                                     |                       |         |         |          |         |         |         |        |          |         |          |        |          |         |         |         |          |         |          |       
|                                  | Domestic:                                      |                                       |                |                                                     |                       |         |         |          |         |         |         |        |          |         |          |        |          |         |         |         |          |         |          |        |        
|                                  |                                                | Time deposits                         |                |                                                     | (26,749               | )       |         |          | (85,373 | )       |         |        | (112,122 | )       |          |        | 98,196   |         |         |         | (183,805 | )       |          |        | (85,609 | )      
|                                  |                                                | Money market deposit accounts         |                |                                                     | (7,077                | )       |         |          | (13,257 | )       |         |        | (20,334  | )       |          |        | 19,849   |         |         |         | (68,804  | )       |          |        | (48,955 | )      
|                                  |                                                | Interest-bearing transaction accounts |                |                                                     | (6                    | )       |         |          | (74     | )       |         |        | (80      | )       |          |        | 52       |         |         |         | (322     | )       |          |        | (270    | )      
|                                  |                                                | Savings accounts                      |                |                                                     | 55                    |         |         |          | 213     |         |         |        | 268      |         |          |        | 117      |         |         |         | (452     | )       |          |        | (335    | )      
|                                  |                                                |                                       |                |                                                     |                       |         |         |          |         |         |         |        |          |         |          |        |          |        
|                                  |                                                |                                       |                | Total domestic interest-bearing deposits            |                       |         | (33,777 | )        |         |         | (98,491 | )      |          |         | (132,268 | )      |          |         | 118,214 |         |          |         | (253,383 | )      |         |         | (135,169 | )
|                                  | Foreign:                                       |                                       |                |                                                     |                       |         |         |          |         |         |         |        |          |         |          |        |          |         |         |         |          |         |          |        |        
|                                  |                                                | Time deposits                         |                |                                                     | 3,618                 |         |         |          | 2,671   |         |         |        | 6,289    |         |          |        | (7,360   | )       |         |         | (5,192   | )       |          |        | (12,552 | )      
|                                  |                                                |                                       |                |                                                     |                       |         |         |          |         |         |         |        |          |         |          |        |          |        
|                                  |                                                |                                       |                | Total interest-bearing deposits                     |                       |         | (30,159 | )        |         |         | (95,820 | )      |          |         | (125,979 | )      |          |         | 110,854 |         |          |         | (258,575 | )      |         |         | (147,721 | )
|Borrowed funds:                   |                                                |                                       |                |                                                     |                       |         |         |          |         |         |         |        |          |         |          |        |          |         |         |         |          |         |          |       
|                                  | Short-term borrowings:                         |                                       |                |                                                     |                       |         |         |          |         |         |         |        |          |         |          |        |          |         |         |         |          |         |          |        |        
|                                  |                                                | Domestic                              |                |                                                     | (3,062                | )       |         |          | 233     |         |         |        | (2,829   | )       |          |        | (1,712   | )       |         |         | (1,154   | )       |          |        | (2,866  | )      
|                                  |                                                | Foreign                               |                |                                                     | 38,044                |         |         |          | 2,563   |         |         |        | 40,607   |         |          |        | (1,897   | )       |         |         | 917      |         |          |        | (980    | )      
|                                  |                                                |                                       |                |                                                     |                       |         |         |          |         |         |         |        |          |         |          |        |          |        
|                                  |                                                |                                       |                | Total short-term borrowings                         |                       |         | 34,982  |          |         |         | 2,796   |        |          |         | 37,778   |        |          |         | (3,609  | )       |          |         | (237     | )      |         |         | (3,846   | )
|                                  | Long-term debt and bank notes:                 |                                       |                |                                                     |                       |         |         |          |         |         |         |        |          |         |          |        |          |         |         |         |          |         |          |        |        
|                                  |                                                | Domestic                              |                |                                                     | 9,171                 |         |         |          | 32,657  |         |         |        | 41,828   |         |          |        | 43,270   |         |         |         | (34,493  | )       |          |        | 8,777   |        
|                                  |                                                | Foreign                               |                |                                                     | 47,605                |         |         |          | 22,075  |         |         |        | 69,680   |         |          |        | 50,676   |         |         |         | (2,870   | )       |          |        | 47,806  |        
|                                  |                                                |                                       |                |                                                     |                       |         |         |          |         |         |         |        |          |         |          |        |          |        
|                                  |                                                |                                       |                | Total long-term debt and bank notes                 |                       |         | 56,776  |          |         |         | 54,732  |        |          |         | 111,508  |        |          |         | 93,946  |         |          |         | (37,363  | )      |         |         | 56,583   |  
|                                  |                                                |                                       |                |                                                     |                       |         |         |          |         |         |         |        |          |         |          |        |          |        
|                                  |                                                |                                       |                | Total borrowed funds                                |                       |         | 91,758  |          |         |         | 57,528  |        |          |         | 149,286  |        |          |         | 90,337  |         |          |         | (37,600  | )      |         |         | 52,737   |  
|                                  |                                                |                                       |                |                                                     |                       |         |         |          |         |         |         |        |          |         |          |        |          |        
|                                  |                                                |                                       |                | Total interest expense                              |                       |         | 61,599  |          |         |         | (38,292 | )      |          |         | 23,307   |        |          |         | 201,191 |         |          |         | (296,175 | )      |         |         | (94,984  | )
|                                  |                                                |                                       |                |                                                     |                       |         |         |          |         |         |         |        |          |         |          |        |          |        
|                                  |                                                |                                       |                | Net interest income (b)                             |                       | $       | 206,742 |          |         | $       | (20,084 | )      |          | $       | 186,658  |        |          | $       | 218,085 |         |          | $       | 57,402   |        |         | $       | 275,487  |  
|                                  |                                                |                                       |                |                                                     |                       |         |         |          |         |         |         |        |          |         |          |        |          |        
|                                 



|    |  |                                                                                                                                                                                                                                                                                                                                                                                                               
|--- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) |  | The rate-volume variance for each category has been allocated on
    a consistent basis between rate and volume variances based on
    the percentage of the rate or volume variance to the sum of the
    two absolute variances.                                                                                                                                                                            
|(b) |  | Rate-volume variance amounts include the impact of the change in
    the estimated value of accrued interest and fees in 2002.                                                                                                                                                                                                                                                                                
|(c) |  | The Corporation reclassified certain loan products to separately
    report its commercial loan products. Business card products were
    reclassified from credit card loans to commercial loans, and all
    other commercial loan products were reclassified from other
    consumer loans to commercial loans. For purposes of
    comparability, certain prior period amounts have been
    reclassified.









---



##### 





AVERAGE INTEREST-EARNING ASSETS
   AVERAGE INTEREST-BEARING LIABILITIES


NET INTEREST MARGIN


TABLE 6: SUMMARIZED AVERAGE INTEREST-EARNING ASSETS AND
AVERAGE INTEREST-BEARING 
LIABILITIES (dollars in
thousands, yields and rates on a fully taxable equivalent
basis)


|                                   |  |         |            |      |        |  |      |           |  |   |           |  |  |        |            |  |           |      |      |         |  |   |           |  |  |           |            |  |  |  |      |   |  |   |           | 
|---------------------------------- |  | ------- | ---------- | ---- | ------ |  | ---- | --------- |  | - | --------- |  |  | ------ | ---------- |  | --------- | ---- | ---- | ------- |  | - | --------- |  |  | --------- | ---------- |  |  |  | ---- | - |  | - | --------- | 
|Year Ended December 31,            |  |         |            | 2004 |        |  |      |           |  |   | 2003      |  |  |        |            |  |           | 2002 |      |         | 
|                                   | 
|                                   |  | Average |            |      | Yield/ |  |      | Income or |  |   | Average   |  |  | Yield/ |            |  | Income or |      |      | Average |  |   | Yield/    |  |  | Income or |           
|                                   |  | Balance |            |      | Rate   |  |      | Expense   |  |   | Balance   |  |  | Rate   |            |  | Expense   |      |      | Balance |  |   | Rate      |  |  | Expense   |           
|                                   |  |         |           
|Total interest-earning assets      |  | $       | 47,622,866 |      |        |  | 8.55 | %         |  | $ | 4,069,608 |  |  | $      | 43,781,381 |  |           |      | 8.82 | %       |  | $ | 3,859,643 |  |  | $         | 37,442,931 |  |  |  | 9.83 | % |  | $ | 3,679,140 | 
|Total interest-bearing liabilities |  |         | 42,879,347 |      |        |  | 3.57 |           |  |   | 1,531,818 |  |  |        | 41,861,029 |  |           |      | 3.60 |         |  |   | 1,508,511 |  |  |           | 36,865,484 |  |  |  | 4.35 |   |  |   | 1,603,495 | 
|                                   |  |         |            |      |        |  |      |           |  |   |           |  |  |        |            |  |           |      |      |         |  |   |           |  |  |           |           
|Net interest income                |  |         |            |      |        |  |      |           |  | $ | 2,537,790 |  |  |        |            |  |           |      |      |         |  | $ | 2,351,132 |  |  |           |            |  |  |  |      |   |  | $ | 2,075,645 | 
|                                   |  |         |            |      |        |  |      |           |  |   |           |  |  |        |            |  |           |      |      |         |  |   |           |  |  |           |           
|Net interest margin                |  |         |            |      |        |  | 5.33 |           |  |   |           |  |  |        |            |  |           |      | 5.37 |         |  |   |           |  |  |           |            |  |  |  | 5.54 |   |  |   |           | 
|                                  







---



##### 





INVESTMENT SECURITIES AND MONEY MARKET INSTRUMENTS
  INVESTMENT SECURITIES
   MONEY MARKET INSTRUMENTS


OTHER INTEREST-EARNING ASSETS
    LOAN RECEIVABLES








---



##### 



TABLE 7: LOAN RECEIVABLES DISTRIBUTION
(a) (dollars in
thousands)


|                                  |                |                                              |      |           |            |  |  |      |       |   |   |            |            |  |  |      |       |      |   |           |            |  |      |      |       |   |   |           |            |  |  |      |       |   |   |           |            |  |  |      |       |  
|--------------------------------- | -------------- | -------------------------------------------- | ---- | --------- | ---------- |  |  | ---- | ----- | - | - | ---------- | ---------- |  |  | ---- | ----- | ---- | - | --------- | ---------- |  | ---- | ---- | ----- | - | - | --------- | ---------- |  |  | ---- | ----- | - | - | --------- | ---------- |  |  | ---- | ----- | -
|December 31,                      |                |                                              | 2004 |           |            |  |  | 2003 |       |   |   |            | 2002       |  |  |      |       | 2001 |   |           |            |  | 2000 |      |       |  
|                                 
|Loans Held for Securitization (b) |                |                                              |      |           |            |  |  |      |       |   |   |            |            |  |  |      |       |      |   |           |            |  |      |      |       |   |   |           |            |  |  |      |       |   |   |           |            |  |  |     
|Domestic:                         |                |                                              |      |           |            |  |  |      |       |   |   |            |            |  |  |      |       |      |   |           |            |  |      |      |       |   |   |           |            |  |  |      |       |   |   |           |            |  |  |     
|                                  | Credit card    |                                              | $    | 7,023,182 |            |  |  | 20.8 | %     |   | $ | 10,273,503 |            |  |  | 30.6 | %     |      | $ | 8,703,035 |            |  |      | 30.3 | %     |   | $ | 7,943,295 |            |  |  | 32.2 | %     |   | $ | 6,395,826 |            |  |  | 32.1 | %    
|                                  | Other consumer |                                              |      | 15,960    |            |  |  |     |       |   |   | 11,653     |            |  |  |     |       |      |   | 40,962    |            |  |      | .1   |       |   |   | 1,032,697 |            |  |  | 4.2  |       |   |   | 1,022,756 |            |  |  | 5.1  |      
|                                  | Commercial     |                                              |      | 667       |            |  |  |     |       |   |   | 759        |            |  |  |     |       |      |   | 454,716   |            |  |      | 1.6  |       |   |   | 670       |            |  |  |     |       |   |   | 826       |            |  |  |     |      
|                                  |                |                                              |      |           |            |  |  |      |       |   |   |            |            |  |  |      |       |      |   |           |            |  |      |      |       |   |   |           |            | 
|                                  |                | Total domestic loans held for securitization |      |           | 7,039,809  |  |  |      | 20.8  |   |   |            | 10,285,915 |  |  |      | 30.6  |      |   |           | 9,198,713  |  |      |      | 32.0  |   |   |           | 8,976,662  |  |  |      | 36.4  |   |   |           | 7,419,408  |  |  |      | 37.2  |  
|Foreign:                          |                |                                              |      |           |            |  |  |      |       |   |   |            |            |  |  |      |       |      |   |           |            |  |      |      |       |   |   |           |            |  |  |      |       |   |   |           |            |  |  |     
|                                  | Credit card    |                                              |      | 1,199,678 |            |  |  | 3.6  |       |   |   | 2,798,190  |            |  |  | 8.3  |       |      |   | 1,830,914 |            |  |      | 6.4  |       |   |   | 953,286   |            |  |  | 3.9  |       |   |   | 852,525   |            |  |  | 4.3  |      
|                                  | Other consumer |                                              |      |          |            |  |  |     |       |   |   |           |            |  |  |     |       |      |   |          |            |  |      |     |       |   |   |          |            |  |  |     |       |   |   |          |            |  |  |     |      
|                                  | Commercial     |                                              |      |          |            |  |  |     |       |   |   |           |            |  |  |     |       |      |   |          |            |  |      |     |       |   |   |          |            |  |  |     |       |   |   |          |            |  |  |     |      
|                                  |                |                                              |      |           |            |  |  |      |       |   |   |            |            |  |  |      |       |      |   |           |            |  |      |      |       |   |   |           |            | 
|                                  |                | Total foreign loans held for securitization  |      |           | 1,199,678  |  |  |      | 3.6   |   |   |            | 2,798,190  |  |  |      | 8.3   |      |   |           | 1,830,914  |  |      |      | 6.4   |   |   |           | 953,286    |  |  |      | 3.9   |   |   |           | 852,525    |  |  |      | 4.3   |  
|                                  |                |                                              |      |           |            |  |  |      |       |   |   |            |            |  |  |      |       |      |   |           |            |  |      |      |       |   |   |           |            | 
|                                  |                | Total loans held for securitization          |      |           | 8,239,487  |  |  |      | 24.4  |   |   |            | 13,084,105 |  |  |      | 38.9  |      |   |           | 11,029,627 |  |      |      | 38.4  |   |   |           | 9,929,948  |  |  |      | 40.3  |   |   |           | 8,271,933  |  |  |      | 41.5  |  
|Loan Portfolio                    |                |                                              |      |           |            |  |  |      |       |   |   |            |            |  |  |      |       |      |   |           |            |  |      |      |       |   |   |           |            |  |  |      |       |   |   |           |            |  |  |     
|Domestic:                         |                |                                              |      |           |            |  |  |      |       |   |   |            |            |  |  |      |       |      |   |           |            |  |      |      |       |   |   |           |            |  |  |      |       |   |   |           |            |  |  |     
|                                  | Credit card    |                                              |      | 6,895,187 |            |  |  | 20.4 |       |   |   | 7,223,190  |            |  |  | 21.5 |       |      |   | 5,974,054 |            |  |      | 20.8 |       |   |   | 5,307,860 |            |  |  | 21.5 |       |   |   | 5,799,805 |            |  |  | 29.1 |      
|                                  | Other consumer |                                              |      | 5,822,947 |            |  |  | 17.3 |       |   |   | 5,599,281  |            |  |  | 16.7 |       |      |   | 6,134,204 |            |  |      | 21.3 |       |   |   | 4,973,339 |            |  |  | 20.2 |       |   |   | 2,704,370 |            |  |  | 13.5 |      
|                                  | Commercial     |                                              |      | 2,735,907 |            |  |  | 8.1  |       |   |   | 1,293,718  |            |  |  | 3.8  |       |      |   | 590,609   |            |  |      | 2.1  |       |   |   | 1,252,470 |            |  |  | 5.1  |       |   |   | 908,027   |            |  |  | 4.5  |      
|                                  |                |                                              |      |           |            |  |  |      |       |   |   |            |            |  |  |      |       |      |   |           |            |  |      |      |       |   |   |           |            | 
|                                  |                | Total domestic loan portfolio                |      |           | 15,454,041 |  |  |      | 45.8  |   |   |            | 14,116,189 |  |  |      | 42.0  |      |   |           | 12,698,867 |  |      |      | 44.2  |   |   |           | 11,533,669 |  |  |      | 46.8  |   |   |           | 9,412,202  |  |  |      | 47.1  |  
|Foreign:                          |                |                                              |      |           |            |  |  |      |       |   |   |            |            |  |  |      |       |      |   |           |            |  |      |      |       |   |   |           |            |  |  |      |       |   |   |           |            |  |  |     
|                                  | Credit card    |                                              |      | 5,573,013 |            |  |  | 16.5 |       |   |   | 3,967,192  |            |  |  | 11.8 |       |      |   | 3,070,997 |            |  |      | 10.7 |       |   |   | 1,822,104 |            |  |  | 7.4  |       |   |   | 1,185,859 |            |  |  | 6.0  |      
|                                  | Other consumer |                                              |      | 3,266,118 |            |  |  | 9.7  |       |   |   | 2,418,449  |            |  |  | 7.2  |       |      |   | 1,927,015 |            |  |      | 6.7  |       |   |   | 1,347,843 |            |  |  | 5.5  |       |   |   | 1,084,843 |            |  |  | 5.4  |      
|                                  | Commercial     |                                              |      | 1,226,191 |            |  |  | 3.6  |       |   |   | 38,142     |            |  |  | .1   |       |      |   | 2         |            |  |      |     |       |   |   |          |            |  |  |     |       |   |   |          |            |  |  |     |      
|                                  |                |                                              |      |           |            |  |  |      |       |   |   |            |            |  |  |      |       |      |   |           |            |  |      |      |       |   |   |           |            | 
|                                  |                | Total foreign loan portfolio                 |      |           | 10,065,322 |  |  |      | 29.8  |   |   |            | 6,423,783  |  |  |      | 19.1  |      |   |           | 4,998,014  |  |      |      | 17.4  |   |   |           | 3,169,947  |  |  |      | 12.9  |   |   |           | 2,270,702  |  |  |      | 11.4  |  
|                                  |                |                                              |      |           |            |  |  |      |       |   |   |            |            |  |  |      |       |      |   |           |            |  |      |      |       |   |   |           |            | 
|                                  |                | Total loan portfolio                         |      |           | 25,519,363 |  |  |      | 75.6  |   |   |            | 20,539,972 |  |  |      | 61.1  |      |   |           | 17,696,881 |  |      |      | 61.6  |   |   |           | 14,703,616 |  |  |      | 59.7  |   |   |           | 11,682,904 |  |  |      | 58.5  |  
|                                  |                |                                              |      |           |            |  |  |      |       |   |   |            |            |  |  |      |       |      |   |           |            |  |      |      |       |   |   |           |            | 
|                                  |                | Total loan receivables                       |      | $         | 33,758,850 |  |  |      | 100.0 | % |   | $          | 33,624,077 |  |  |      | 100.0 | %    |   | $         | 28,726,508 |  |      |      | 100.0 | % |   | $         | 24,633,564 |  |  |      | 100.0 | % |   | $         | 19,954,837 |  |  |      | 100.0 | %
|                                  |                |                                              |      |           |            |  |  |      |       |   |   |            |            |  |  |      |       |      |   |           |            |  |      |      |       |   |   |           |            | 
|                                 



|    |  |                                                                                                                                                                                                                                                                                                                                                                                                                         
|--- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) |  | The Corporation reclassified certain loan products to separately
    report its commercial loan products. Business card products were
    reclassified from credit card loans to commercial loans, and all
    other commercial loan products were reclassified from other
    consumer loans to commercial loans. For purposes of
    comparability, certain prior period amounts have been
    reclassified.          
|(b) |  | Loans held for securitization includes loans originated through
    certain endorsing organizations or financial institutions who
    have the contractual right to purchase the loans from the
    Corporation at fair value and the lesser of loan principal
    receivables eligible for securitization or sale or loan
    principal receivables which management intends to securitize or
    sell within one year.






DOMESTIC CREDIT CARD LOAN RECEIVABLES










---



##### 






DOMESTIC OTHER CONSUMER LOAN RECEIVABLES
    DOMESTIC COMMERCIAL LOAN RECEIVABLES










---



##### 



TABLE 8: RECONCILIATION OF AVERAGE LOAN RECEIVABLES TO
AVERAGE MANAGED
LOANS (a) (dollars
in thousands)


|                        |           |                |                                 |   |            |             |         |        |       |       |         |         |           |            |  |   |            |             |  |         |       |       |       |   |           |            |  |   |            |             |  |  |       |       |  |   |           |            | 
|----------------------- | --------- | -------------- | ------------------------------- | - | ---------- | ----------- | ------- | ------ | ----- | ----- | ------- | ------- | --------- | ---------- |  | - | ---------- | ----------- |  | ------- | ----- | ----- | ----- | - | --------- | ---------- |  | - | ---------- | ----------- |  |  | ----- | ----- |  | - | --------- | ---------- | 
|Year Ended December 31, |           |                | 2004                            |   |            | 2003        |         |        | 2002  |      
|                        |          
|                        |           | Average        |                                 |   |            |             | Average |        |       |       |         | Average |           |            | 
|                        |           | Balance        |                                 |   | Yield      |             |         | Income |       |       | Balance |         |           | Yield      |  |   | Income     |             |  | Balance |       |       | Yield |   |           | Income     | 
|                        |           |                |                                
|Loan receivables:       |           |                |                                 |   |            |             |         |        |       |       |         |         |           |            |  |   |            |             |  |         |       |       |       |   |           |            |  |   |            |             |  |  |       |       |  |  
|                        | Domestic: |                |                                 |   |            |             |         |        |       |       |         |         |           |            |  |   |            |             |  |         |       |       |       |   |           |            |  |   |            |             |  |  |       |       |  |   |          
|                        |           | Credit card    |                                 | $ | 13,712,807 |             |         |        | 11.47 | %     |         | $       | 1,573,309 |            |  | $ | 13,633,341 |             |  |         | 11.70 | %     |       | $ | 1,595,683 |            |  | $ | 12,369,662 |             |  |  | 12.04 | %     |  | $ | 1,489,776 |           
|                        |           | Other consumer |                                 |   | 5,593,131  |             |         |        | 13.68 |       |         |         | 765,101   |            |  |   | 6,104,789  |             |  |         | 13.89 |       |       |   | 847,867   |            |  |   | 6,191,971  |             |  |  | 13.97 |       |  |   | 864,756   |           
|                        |           | Commercial     |                                 |   | 2,190,095  |             |         |        | 8.14  |       |         |         | 178,190   |            |  |   | 1,034,082  |             |  |         | 8.28  |       |       |   | 85,673    |            |  |   | 1,352,992  |             |  |  | 7.91  |       |  |   | 107,017   |           
|                        |           |                |                                 |   |            |             |         |        |       |       |         |         |           |            |  |   |            |             |  |         |       |       |       |   |           |            | 
|                        |           |                | Total domestic loan receivables |   |            | 21,496,033  |         |        |       | 11.71 |         |         |           | 2,516,600  |  |   |            | 20,772,212  |  |         |       | 12.18 |       |   |           | 2,529,223  |  |   |            | 19,914,625  |  |  |       | 12.36 |  |   |           | 2,461,549  | 
|                        | Foreign:  |                |                                 |   |            |             |         |        |       |       |         |         |           |            |  |   |            |             |  |         |       |       |       |   |           |            |  |   |            |             |  |  |       |       |  |   |          
|                        |           | Credit card    |                                 |   | 5,466,831  |             |         |        | 11.09 |       |         |         | 606,437   |            |  |   | 5,296,873  |             |  |         | 11.30 |       |       |   | 598,780   |            |  |   | 3,782,733  |             |  |  | 12.37 |       |  |   | 468,100   |           
|                        |           | Other consumer |                                 |   | 3,027,292  |             |         |        | 9.27  |       |         |         | 280,675   |            |  |   | 2,097,784  |             |  |         | 9.54  |       |       |   | 200,152   |            |  |   | 1,617,842  |             |  |  | 10.16 |       |  |   | 164,363   |           
|                        |           | Commercial     |                                 |   | 1,065,631  |             |         |        | 8.25  |       |         |         | 87,910    |            |  |   | 16,949     |             |  |         | 6.36  |       |       |   | 1,078     |            |  |   |           |             |  |  |      |       |  |   |          |           
|                        |           |                |                                 |   |            |             |         |        |       |       |         |         |           |            |  |   |            |             |  |         |       |       |       |   |           |            | 
|                        |           |                | Total foreign loan receivables  |   |            | 9,559,754   |         |        |       | 10.20 |         |         |           | 975,022    |  |   |            | 7,411,606   |  |         |       | 10.79 |       |   |           | 800,010    |  |   |            | 5,400,575   |  |  |       | 11.71 |  |   |           | 632,463    | 
|                        |           |                |                                 |   |            |             |         |        |       |       |         |         |           |            |  |   |            |             |  |         |       |       |       |   |           |            | 
|                        |           |                | Total loan receivables          |   |            | 31,055,787  |         |        |       | 11.24 |         |         |           | 3,491,622  |  |   |            | 28,183,818  |  |         |       | 11.81 |       |   |           | 3,329,233  |  |   |            | 25,315,200  |  |  |       | 12.22 |  |   |           | 3,094,012  | 
|                        |           |                | Total securitized loans         |   |            | 87,040,251  |         |        |       | 11.68 |         |         |           | 10,167,317 |  |   |            | 81,691,156  |  |         |       | 11.98 |       |   |           | 9,786,020  |  |   |            | 74,718,731  |  |  |       | 12.36 |  |   |           | 9,232,653  | 
|                        |           |                |                                 |   |            |             |         |        |       |       |         |         |           |            |  |   |            |             |  |         |       |       |       |   |           |            | 
|                        |           |                | Total managed loans             |   | $          | 118,096,038 |         |        |       | 11.57 |         |         | $         | 13,658,939 |  |   | $          | 109,874,974 |  |         |       | 11.94 |       |   | $         | 13,115,253 |  |   | $          | 100,033,931 |  |  |       | 12.32 |  |   | $         | 12,326,665 | 
|                        |           |                |                                 |   |            |             |         |        |       |       |         |         |           |            |  |   |            |             |  |         |       |       |       |   |           |            | 
|                       



|    |  |                                                                                                                                                                                                                                                                                                                                                                                                               
|--- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) |  | The Corporation reclassified certain loan products to separately
    report its commercial loan products. Business card products were
    reclassified from credit card loans to commercial loans, and all
    other commercial loan products were reclassified from other
    consumer loans to commercial loans. For purposes of
    comparability, certain prior period amounts have been
    reclassified.



FOREIGN CREDIT CARD LOAN RECEIVABLES


FOREIGN OTHER CONSUMER LOAN RECEIVABLES
   FOREIGN COMMERCIAL LOAN RECEIVABLES










---



##### 



TABLE 9: RECONCILIATION OF THE AS REPORTED LOAN YIELDS TO
THE LOAN YIELDS EXCLUDING THE CHANGE IN THE ESTIMATED VALUE OF
ACCRUED INTEREST AND FEES IN
2002 (a) (dollars
in thousands)


|                                                                                     |                   |           |                |                                 |       |            |             |        |  |       |       |  |   |           |            | 
|------------------------------------------------------------------------------------ | ----------------- | --------- | -------------- | ------------------------------- | ----- | ---------- | ----------- | ------ |  | ----- | ----- |  | - | --------- | ---------- | 
|Year Ended December 31, 2002                                                         |                  
|                                                                                     |                  
|                                                                                     |                   | Average   |                |                                 |      
|                                                                                     |                   | Balance   |                |                                 | Yield |            |             | Income | 
|                                                                                     |                   |           |               
|As Reported                                                                          |                   |           |                |                                 |       |            |             |        |  |       |       | 
|                                                                                     | Loan receivables: |           |                |                                 |       |            |             |        |  |       |       |  |  
|                                                                                     |                   | Domestic: |                |                                 |       |            |             |        |  |       |       |  |   |          
|                                                                                     |                   |           | Credit card    |                                 | $     | 12,369,662 |             |        |  | 12.04 | %     |  | $ | 1,489,776 |           
|                                                                                     |                   |           | Other consumer |                                 |       | 6,191,971  |             |        |  | 13.97 |       |  |   | 864,756   |           
|                                                                                     |                   |           | Commercial     |                                 |       | 1,352,992  |             |        |  | 7.91  |       |  |   | 107,017   |           
|                                                                                     |                   |           |                |                                 |       |            |             |        | 
|                                                                                     |                   |           |                | Total domestic loan receivables |       |            | 19,914,625  |        |  |       | 12.36 |  |   |           | 2,461,549  | 
|                                                                                     |                   | Foreign:  |                |                                 |       |            |             |        |  |       |       |  |   |          
|                                                                                     |                   |           | Credit card    |                                 |       | 3,782,733  |             |        |  | 12.37 |       |  |   | 468,100   |           
|                                                                                     |                   |           | Other consumer |                                 |       | 1,617,842  |             |        |  | 10.16 |       |  |   | 164,363   |           
|                                                                                     |                   |           | Commercial     |                                 |       |           |             |        |  |      |       |  |   |          |           
|                                                                                     |                   |           |                |                                 |       |            |             |        | 
|                                                                                     |                   |           |                | Total foreign loan receivables  |       |            | 5,400,575   |        |  |       | 11.71 |  |   |           | 632,463    | 
|                                                                                     |                   |           |                |                                 |       |            |             |        | 
|                                                                                     |                   |           |                | Total loan receivables          |       |            | 25,315,200  |        |  |       | 12.22 |  |   |           | 3,094,012  | 
|                                                                                     |                   |           |                | Total securitized loans         |       |            | 74,718,731  |        |  |       | 12.36 |  |   |           | 9,232,653  | 
|                                                                                     |                   |           |                |                                 |       |            |             |        | 
|                                                                                     |                   |           |                | Total managed loans             |       | $          | 100,033,931 |        |  |       | 12.32 |  |   | $         | 12,326,665 | 
|                                                                                     |                   |           |                |                                 |       |            |             |        | 
|Impact of the Change in the Estimated Value of Accrued
    Interest and Fees in 2002 |                   |           |                |                                 |       |            |             |        |  |       |       | 
|                                                                                     | Loan receivables: |           |                |                                 |       |            |             |        |  |       |       |  |  
|                                                                                     |                   | Domestic: |                |                                 |       |            |             |        |  |       |       |  |   |          
|                                                                                     |                   |           | Credit card    |                                 | $     | 11,940     |             |        |  |       |       |  | $ | 35,260    |           
|                                                                                     |                   |           | Other consumer |                                 |       | 8,213      |             |        |  |       |       |  |   | 25,168    |           
|                                                                                     |                   |           | Commercial     |                                 |       | 503        |             |        |  |       |       |  |   | 1,615     |           
|                                                                                     |                   |           |                |                                 |       |            |             |        | 
|                                                                                     |                   |           |                | Total domestic loan receivables |       |            | 20,656      |        |  |       |       |  |   |           | 62,043     | 
|                                                                                     |                   | Foreign:  |                |                                 |       |            |             |        |  |       |       |  |   |          
|                                                                                     |                   |           | Credit card    |                                 |       | 1,374      |             |        |  |       |       |  |   | 4,193     |           
|                                                                                     |                   |           | Other consumer |                                 |       |           |             |        |  |       |       |  |   |          |           
|                                                                                     |                   |           | Commercial     |                                 |       |           |             |        |  |       |       |  |   |          |           
|                                                                                     |                   |           |                |                                 |       |            |             |        | 
|                                                                                     |                   |           |                | Total foreign loan receivables  |       |            | 1,374       |        |  |       |       |  |   |           | 4,193      | 
|                                                                                     |                   |           |                |                                 |       |            |             |        | 
|                                                                                     |                   |           |                | Total loan receivables          |       |            | 22,030      |        |  |       |       |  |   |           | 66,236     | 
|                                                                                     |                   |           |                | Total securitized loans         |       |            | 71,386      |        |  |       |       |  |   |           | 211,425    | 
|                                                                                     |                   |           |                |                                 |       |            |             |        | 
|                                                                                     |                   |           |                | Total managed loans             |       | $          | 93,416      |        |  |       |       |  |   | $         | 277,661    | 
|                                                                                     |                   |           |                |                                 |       |            |             |        | 
|Excluding the Change in the Estimated Value of Accrued
    Interest and Fees in 2002 |                   |           |                |                                 |       |            |             |        |  |       |       | 
|                                                                                     | Loan receivables: |           |                |                                 |       |            |             |        |  |       |       |  |  
|                                                                                     |                   | Domestic: |                |                                 |       |            |             |        |  |       |       |  |   |          
|                                                                                     |                   |           | Credit card    |                                 | $     | 12,381,602 |             |        |  | 12.32 |       |  | $ | 1,525,036 |           
|                                                                                     |                   |           | Other consumer |                                 |       | 6,200,184  |             |        |  | 14.35 |       |  |   | 889,924   |           
|                                                                                     |                   |           | Commercial     |                                 |       | 1,353,495  |             |        |  | 8.03  |       |  |   | 108,632   |           
|                                                                                     |                   |           |                |                                 |       |            |             |        | 
|                                                                                     |                   |           |                | Total domestic loan receivables |       |            | 19,935,281  |        |  |       | 12.66 |  |   |           | 2,523,592  | 
|                                                                                     |                   | Foreign:  |                |                                 |       |            |             |        |  |       |       |  |   |          
|                                                                                     |                   |           | Credit card    |                                 |       | 3,784,107  |             |        |  | 12.48 |       |  |   | 472,293   |           
|                                                                                     |                   |           | Other consumer |                                 |       | 1,617,842  |             |        |  | 10.16 |       |  |   | 164,363   |           
|                                                                                     |                   |           | Commercial     |                                 |       |           |             |        |  |      |       |  |   |          |           
|                                                                                     |                   |           |                |                                 |       |            |             |        | 
|                                                                                     |                   |           |                | Total foreign loan receivables  |       |            | 5,401,949   |        |  |       | 11.79 |  |   |           | 636,656    | 
|                                                                                     |                   |           |                |                                 |       |            |             |        | 
|                                                                                     |                   |           |                | Total loan receivables          |       |            | 25,337,230  |        |  |       | 12.47 |  |   |           | 3,160,248  | 
|                                                                                     |                   |           |                | Total securitized loans         |       |            | 74,790,117  |        |  |       | 12.63 |  |   |           | 9,444,078  | 
|                                                                                     |                   |           |                |                                 |       |            |             |        | 
|                                                                                     |                   |           |                | Total managed loans             |       | $          | 100,127,347 |        |  |       | 12.59 |  |   | $         | 12,604,326 | 
|                                                                                     |                   |           |                |                                 |       |            |             |        | 
|                                                                                    



|    |  |                                                                                                                                                                                                                                                                                                                                                                                                               
|--- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) |  | The Corporation reclassified certain loan products to separately
    report its commercial loan products. Business card products were
    reclassified from credit card loans to commercial loans, and all
    other commercial loan products were reclassified from other
    consumer loans to commercial loans. For purposes of
    comparability, certain prior period amounts have been
    reclassified.



PREMISES AND EQUIPMENT













---



##### 





ACCRUED INCOME RECEIVABLE
  ACCOUNTS RECEIVABLE FROM SECURITIZATION
   TABLE 10: ACCOUNTS RECEIVABLE FROM
SECURITIZATION (dollars
in thousands)
 December 31,
    
    2004
    
    2003Sale of new loan principal receivables (a)
    
    $
    2,767,607
    
    
    $
    2,191,335Accrued interest and fees on securitized loans
    
    
    1,945,331
    
    
    
    1,958,873Interest-only strip receivable
    
    
    1,292,765
    
    
    
    1,338,061Accrued servicing fees
    
    
    900,012
    
    
    
    777,623Cash reserve accounts
    
    
    720,702
    
    
    
    607,467Other subordinated retained interests
    
    
    593,037
    
    
    
    608,550Other
    
    
    224,395
    
    
    
    284,568Total accounts receivable from securitization
    
    $
    8,443,849
    
    
    $
    7,766,477 (a)
    
    Balance comprised of allocated principal collections and
    accumulated investor interest. INTANGIBLE ASSETS AND GOODWILL
  PREPAID EXPENSES AND DEFERRED CHARGES
  INTEREST-BEARING DEPOSITS













---



##### 



BORROWED FUNDS
  SHORT-TERM BORROWINGS
   Domestic Short-Term Borrowings


Foreign Short-Term Borrowings
   LONG-TERM DEBT AND BANK NOTES
    Domestic Long-Term Debt and Bank Notes








---



##### 



Foreign Long-Term Debt and Bank Notes
   NONINTEREST-BEARING DEPOSITS


ACCRUED INTEREST PAYABLE
  ACCRUED EXPENSES AND OTHER LIABILITIES
  ACCUMULATED OTHER COMPREHENSIVE INCOME
   TOTAL OTHER OPERATING INCOME










---



##### 





TABLE 11: COMPONENTS OF TOTAL OTHER OPERATING
INCOME (dollars in
thousands)
 Year Ended December 31,
    
    2004
    
    2003
    
    2002Securitization income:Excess servicing fees (a)
    
    $
    5,191,359
    
    
    $
    4,875,381
    
    
    $
    4,304,428Loan servicing fees (a)
    
    
    1,664,669
    
    
    
    1,535,427
    
    
    
    1,403,132Gain from the sale
    of loan principal receivables for new securitizations (b)
    
    
    90,884
    
    
    
    124,450
    
    
    
    154,556Net revaluation of
    interest-only strip receivable (b)
    
    
    (193,604
    )
    
    
    (11,302
    )
    
    
    (195,764
    )Total securitization income
    
    
    6,753,308
    
    
    
    6,523,956
    
    
    
    5,666,352Interchange
    
    
    442,104
    
    
    
    391,827
    
    
    
    357,410Credit card loan fees (c)
    
    
    515,915
    
    
    
    467,166
    
    
    
    353,105Other consumer loan
    fees (c)
    
    
    170,592
    
    
    
    108,072
    
    
    
    100,429Commercial loan fees (c)
    
    
    69,568
    
    
    
    46,593
    
    
    
    32,750Insurance
    
    
    200,536
    
    
    
    231,941
    
    
    
    181,474Other
    
    
    106,363
    
    
    
    55,925
    
    
    
    61,403Total other operating income
    
    $
    8,258,386
    
    
    $
    7,825,480
    
    
    $
    6,752,923  (a)
    
    Total securitization servicing fees include excess servicing
    fees and loan servicing fees.(b)
    
    The net gain (or loss) from securitization activity includes the
    gain from the sale of loan principal receivables and the net
    revaluation of the interest-only strip receivable.(c)
    
    The Corporation reclassified certain loan products to separately
    report its commercial loan products. Business card products were
    reclassified from credit card loans to commercial loans, and all
    other commercial loan products were reclassified from other
    consumer loans to commercial loans. For purposes of
    comparability, certain prior period amounts have been
    reclassified.  SECURITIZATION INCOME


TOTAL SECURITIZATION SERVICING FEES
   TABLE 12: COMPONENTS OF TOTAL EXCESS SERVICING
FEES (dollars in
thousands)
 Year Ended December 31,
    
    2004
    
    2003
    
    2002Interest income on securitized loans
    
    $
    9,855,669
    
    
    $
    9,484,680
    
    
    $
    8,877,207Interest expense on securitized loans
    
    
    (1,971,198
    )
    
    
    (1,630,415
    )
    
    
    (1,833,105
    )Net interest income on securitized loans
    
    
    7,884,471
    
    
    
    7,854,265
    
    
    
    7,044,102Other fee income on securitized loans
    
    
    3,247,581
    
    
    
    2,932,012
    
    
    
    2,498,841Net credit losses on securitized loans
    
    
    (4,276,024
    )
    
    
    (4,375,469
    )
    
    
    (3,835,383
    )Total securitization servicing fees
    
    
    6,856,028
    
    
    
    6,410,808
    
    
    
    5,707,560Loan servicing fees
    
    
    (1,664,669
    )
    
    
    (1,535,427
    )
    
    
    (1,403,132
    )Total excess servicing fees
    
    $
    5,191,359
    
    
    $
    4,875,381
    
    
    $
    4,304,428 EXCESS SERVICING FEES










---



##### 








LOAN SERVICING FEES
  NET GAIN (OR LOSS) FROM SECURITIZATION ACTIVITY










---



##### 





GAIN FROM THE SALE OF LOAN PRINCIPAL RECEIVABLES
    TABLE 13: GAIN FROM THE SALE OF LOAN PRINCIPAL RECEIVABLES
FOR NEW SECURITIZATIONS
 (dollars in thousands)
 Year Ended December 31,
    
    2004
    
    2003
    
    2002Gain
    
    $
    138,849
    
    
    $
    175,586
    
    
    $
    196,271Securitization transaction costs
    
    
    (47,965
    )
    
    
    (51,136
    )
    
    
    (41,715
    )Net of securitization transaction costs
    
    $
    90,884
    
    
    $
    124,450
    
    
    $
    154,556Credit card and commercial loan principal receivables sold
    
    $
    12,248,389
    
    
    $
    13,636,725
    
    
    $
    15,476,127 NET REVALUATION OF THE INTEREST-ONLY STRIP RECEIVABLE
 Year Ended December 31, 2004


Year Ended December 31, 2003










---



##### 





Year Ended December 31, 2002
    INTERCHANGE


LOAN FEES
  Credit Card Loan Fees
   Other Consumer Loan Fees
  Commercial Loan Fees










---



##### 



INSURANCE
   OTHER
  TOTAL OTHER OPERATING EXPENSE
    SALARIES AND EMPLOYEE BENEFITS


FURNITURE AND EQUIPMENT EXPENSE
  OTHER EXPENSE COMPONENT OF OTHER OPERATING EXPENSE










---



##### 





TABLE 14: OTHER EXPENSE COMPONENT OF TOTAL OTHER OPERATING
EXPENSE (dollars in
thousands)
 Year Ended December 31,
    
    2004
    
    2003
    
    2002Purchased services
    
    $
    656,505
    
    
    $
    582,724
    
    
    $
    544,104Advertising
    
    
    390,572
    
    
    
    421,965
    
    
    
    315,393Collection
    
    
    110,999
    
    
    
    77,482
    
    
    
    54,872Stationery and supplies
    
    
    41,389
    
    
    
    41,833
    
    
    
    48,073Service bureau
    
    
    95,530
    
    
    
    83,171
    
    
    
    75,444Postage and delivery
    
    
    441,303
    
    
    
    459,592
    
    
    
    366,129Telephone usage
    
    
    88,630
    
    
    
    89,448
    
    
    
    86,562Loan receivable fraud losses
    
    
    150,195
    
    
    
    139,193
    
    
    
    160,639Amortization of intangible assets
    
    
    453,837
    
    
    
    410,973
    
    
    
    348,727Other
    
    
    277,397
    
    
    
    207,031
    
    
    
    248,317Total other expense
    
    $
    2,706,357
    
    
    $
    2,513,412
    
    
    $
    2,248,260 Purchased Services
  Advertising
  Collection
  Postage and Delivery
  Amortization of Intangible Assets


Other
  INCOME TAXES
   LOAN QUALITY










---



##### 



CREDIT RISK


DELINQUENCIES










---



##### 



TABLE 15: DELINQUENT
LOANS (a) (b) (c) (dollars
in thousands)


|                                                 |                     |                |                                                       |           |           |           |  |      |      |      |             |           |           |           |  |      |      |      |             |           |           |           |      |      |      |      |            |           |           |           |  |      |      |      |            |           |           |           |  |      |      |      |  
|------------------------------------------------ | ------------------- | -------------- | ----------------------------------------------------- | --------- | --------- | --------- |  | ---- | ---- | ---- | ----------- | --------- | --------- | --------- |  | ---- | ---- | ---- | ----------- | --------- | --------- | --------- | ---- | ---- | ---- | ---- | ---------- | --------- | --------- | --------- |  | ---- | ---- | ---- | ---------- | --------- | --------- | --------- |  | ---- | ---- | ---- | -
|December 31,                                     |                     |                | 2004                                                  |           |           |           |  | 2003 |      |      |             |           | 2002      |           |  |      |      | 2001 |             |           |           |           | 2000 |      |      |     
|                                                
|Loan Receivables                                 |                     |                |                                                       |           |           |           |  |      |      |      |             |           |           |           |  |      |      |      |             |           |           |           |      |      |      |      |            |           |           |           |  |      |      |      |            |           |           |           |  |     
|Loan receivables outstanding                     |                     | $              | 33,758,850                                            |           |           |           |  |      |      | $    | 33,624,077  |           |           |           |  |      |      | $    | 28,726,508  |           |           |           |      |      |      | $    | 24,633,564 |           |           |           |  |      |      | $    | 19,954,837 |           |           |           |  |     
|Loan receivables delinquent:                     |                     |                |                                                       |           |           |           |  |      |      |      |             |           |           |           |  |      |      |      |             |           |           |           |      |      |      |      |            |           |           |           |  |      |      |      |            |           |           |           |  |     
|                                                 | 30 to 59 days       |                | $                                                     | 385,339   |           |           |  | 1.14 | %    |      | $           | 429,266   |           |           |  | 1.28 | %    |      | $           | 439,911   |           |           |      | 1.53 | %    |      | $          | 433,212   |           |           |  | 1.76 | %    |      | $          | 304,928   |           |           |  | 1.53 | %   
|                                                 | 60 to 89 days       |                |                                                       | 245,700   |           |           |  | .73  |      |      |             | 277,928   |           |           |  | .83  |      |      |             | 273,103   |           |           |      | .95  |      |      |            | 242,784   |           |           |  | .99  |      |      |            | 169,462   |           |           |  | .85  |     
|                                                 | 90 or more days (d) |                |                                                       | 480,402   |           |           |  | 1.42 |      |      |             | 582,605   |           |           |  | 1.73 |      |      |             | 538,589   |           |           |      | 1.88 |      |      |            | 474,905   |           |           |  | 1.92 |      |      |            | 329,290   |           |           |  | 1.65 |     
|                                                 |                     |                |                                                       |           |           |           |  |      |      |      |             |           |           |           |  |      |      |      |             |           |           |           |      |      |      |      |            |           |           |          
|                                                 |                     |                | Total loan receivables delinquent                     |           | $         | 1,111,441 |  |      |      | 3.29 | %           |           | $         | 1,289,799 |  |      |      | 3.84 | %           |           | $         | 1,251,603 |      |      |      | 4.36 | %          |           | $         | 1,150,901 |  |      |      | 4.67 | %          |           | $         | 803,680   |  |      |      | 4.03 | %
|                                                 |                     |                |                                                       |           |           |           |  |      |      |      |             |           |           |           |  |      |      |      |             |           |           |           |      |      |      |      |            |           |           |          
|Loan receivables delinquent by geographic area:  |                     |                |                                                       |           |           |           |  |      |      |      |             |           |           |           |  |      |      |      |             |           |           |           |      |      |      |      |            |           |           |           |  |      |      |      |            |           |           |           |  |     
|                                                 | Domestic (e):       |                |                                                       |           |           |           |  |      |      |      |             |           |           |           |  |      |      |      |             |           |           |           |      |      |      |      |            |           |           |           |  |      |      |      |            |           |           |           |  |      |     
|                                                 |                     | Credit card    |                                                       | $         | 582,038   |           |  |      | 4.18 | %    |             | $         | 759,697   |           |  |      | 4.34 | %    |             | $         | 682,966   |           |      |      | 4.65 | %    |            | $         | 634,128   |           |  |      | 4.79 | %    |            | $         | 536,056   |           |  |      | 4.40 | %   
|                                                 |                     | Other consumer |                                                       |           | 273,906   |           |  |      | 4.69 |      |             |           | 333,589   |           |  |      | 5.95 |      |             |           | 389,298   |           |      |      | 6.30 |      |            |           | 364,744   |           |  |      | 6.07 |      |            |           | 171,107   |           |  |      | 4.59 |     
|                                                 |                     | Commercial     |                                                       |           | 44,315    |           |  |      | 1.62 |      |             |           | 21,333    |           |  |      | 1.65 |      |             |           | 42,292    |           |      |      | 4.05 |      |            |           | 44,699    |           |  |      | 3.57 |      |            |           | 28,757    |           |  |      | 3.16 |     
|                                                 |                     |                |                                                       |           |           |           |  |      |      |      |             |           |           |           |  |      |      |      |             |           |           |           |      |      |      |      |            |           |           |          
|                                                 |                     |                | Total domestic                                        |           |           | 900,259   |  |      |      | 4.00 |             |           |           | 1,114,619 |  |      |      | 4.57 |             |           |           | 1,114,556 |      |      |      | 5.09 |            |           |           | 1,043,571 |  |      |      | 5.09 |            |           |           | 735,920   |  |      |      | 4.37 |  
|                                                 | Foreign (e):        |                |                                                       |           |           |           |  |      |      |      |             |           |           |           |  |      |      |      |             |           |           |           |      |      |      |      |            |           |           |           |  |      |      |      |            |           |           |           |  |      |     
|                                                 |                     | Credit card    |                                                       |           | 139,533   |           |  |      | 2.06 |      |             |           | 124,892   |           |  |      | 1.85 |      |             |           | 101,850   |           |      |      | 2.08 |      |            |           | 81,626    |           |  |      | 2.94 |      |            |           | 50,422    |           |  |      | 2.47 |     
|                                                 |                     | Other consumer |                                                       |           | 45,396    |           |  |      | 1.39 |      |             |           | 49,895    |           |  |      | 2.06 |      |             |           | 35,197    |           |      |      | 1.83 |      |            |           | 25,704    |           |  |      | 1.91 |      |            |           | 17,338    |           |  |      | 1.60 |     
|                                                 |                     | Commercial     |                                                       |           | 26,253    |           |  |      | 2.14 |      |             |           | 393       |           |  |      | 1.03 |      |             |           |          |           |      |      |     |      |            |           |          |           |  |      |     |      |            |           |          |           |  |      |     |     
|                                                 |                     |                |                                                       |           |           |           |  |      |      |      |             |           |           |           |  |      |      |      |             |           |           |           |      |      |      |      |            |           |           |          
|                                                 |                     |                | Total foreign                                         |           |           | 211,182   |  |      |      | 1.87 |             |           |           | 175,180   |  |      |      | 1.90 |             |           |           | 137,047   |      |      |      | 2.01 |            |           |           | 107,330   |  |      |      | 2.60 |            |           |           | 67,760    |  |      |      | 2.17 |  
|                                                 |                     |                |                                                       |           |           |           |  |      |      |      |             |           |           |           |  |      |      |      |             |           |           |           |      |      |      |      |            |           |           |          
|                                                 |                     |                | Total loan receivables delinquent by geographic area  |           | $         | 1,111,441 |  |      |      | 3.29 |             |           | $         | 1,289,799 |  |      |      | 3.84 |             |           | $         | 1,251,603 |      |      |      | 4.36 |            |           | $         | 1,150,901 |  |      |      | 4.67 |            |           | $         | 803,680   |  |      |      | 4.03 |  
|                                                 |                     |                |                                                       |           |           |           |  |      |      |      |             |           |           |           |  |      |      |      |             |           |           |           |      |      |      |      |            |           |           |          
|Securitized Loans                                |                     |                |                                                       |           |           |           |  |      |      |      |             |           |           |           |  |      |      |      |             |           |           |           |      |      |      |      |            |           |           |           |  |      |      |      |            |           |           |           |  |     
|Securitized loans outstanding                    |                     | $              | 87,859,325                                            |           |           |           |  |      |      | $    | 84,869,483  |           |           |           |  |      |      | $    | 78,531,334  |           |           |           |      |      |      | $    | 72,862,487 |           |           |           |  |      |      | $    | 68,835,884 |           |           |           |  |     
|Securitized loans delinquent:                    |                     |                |                                                       |           |           |           |  |      |      |      |             |           |           |           |  |      |      |      |             |           |           |           |      |      |      |      |            |           |           |           |  |      |      |      |            |           |           |           |  |     
|                                                 | 30 to 59 days       |                | $                                                     | 1,305,076 |           |           |  | 1.49 | %    |      | $           | 1,235,230 |           |           |  | 1.46 | %    |      | $           | 1,374,779 |           |           |      | 1.75 | %    |      | $          | 1,383,681 |           |           |  | 1.90 | %    |      | $          | 1,187,368 |           |           |  | 1.72 | %   
|                                                 | 60 to 89 days       |                |                                                       | 858,114   |           |           |  | .97  |      |      |             | 818,356   |           |           |  | .96  |      |      |             | 844,811   |           |           |      | 1.08 |      |      |            | 797,077   |           |           |  | 1.09 |      |      |            | 677,300   |           |           |  | .98  |     
|                                                 | 90 or more days (d) |                |                                                       | 1,750,466 |           |           |  | 1.99 |      |      |             | 1,860,265 |           |           |  | 2.19 |      |      |             | 1,758,318 |           |           |      | 2.24 |      |      |            | 1,630,802 |           |           |  | 2.24 |      |      |            | 1,318,190 |           |           |  | 1.92 |     
|                                                 |                     |                |                                                       |           |           |           |  |      |      |      |             |           |           |           |  |      |      |      |             |           |           |           |      |      |      |      |            |           |           |          
|                                                 |                     |                | Total securitized loans delinquent                    |           | $         | 3,913,656 |  |      |      | 4.45 | %           |           | $         | 3,913,851 |  |      |      | 4.61 | %           |           | $         | 3,977,908 |      |      |      | 5.07 | %          |           | $         | 3,811,560 |  |      |      | 5.23 | %          |           | $         | 3,182,858 |  |      |      | 4.62 | %
|                                                 |                     |                |                                                       |           |           |           |  |      |      |      |             |           |           |           |  |      |      |      |             |           |           |           |      |      |      |      |            |           |           |          
|Securitized loans delinquent by geographic area: |                     |                |                                                       |           |           |           |  |      |      |      |             |           |           |           |  |      |      |      |             |           |           |           |      |      |      |      |            |           |           |           |  |      |      |      |            |           |           |           |  |     
|                                                 | Domestic (e):       |                |                                                       |           |           |           |  |      |      |      |             |           |           |           |  |      |      |      |             |           |           |           |      |      |      |      |            |           |           |           |  |      |      |      |            |           |           |           |  |      |     
|                                                 |                     | Credit card    |                                                       | $         | 3,105,216 |           |  |      | 4.69 | %    |             | $         | 3,207,710 |           |  |      | 4.82 | %    |             | $         | 3,226,283 |           |      |      | 5.09 | %    |            | $         | 3,102,237 |           |  |      | 5.13 | %    |            | $         | 2,624,415 |           |  |      | 4.57 | %   
|                                                 |                     | Other consumer |                                                       |           | 315,531   |           |  |      | 5.57 |      |             |           | 351,655   |           |  |      | 6.20 |      |             |           | 401,469   |           |      |      | 7.07 |      |            |           | 444,464   |           |  |      | 7.79 |      |            |           | 372,845   |           |  |      | 6.55 |     
|                                                 |                     | Commercial     |                                                       |           | 37,195    |           |  |      | 3.69 |      |             |           | 36,802    |           |  |      | 3.65 |      |             |           | 22,531    |           |      |      | 4.48 |      |            |           |          |           |  |      |     |      |            |           |          |           |  |      |     |     
|                                                 |                     |                |                                                       |           |           |           |  |      |      |      |             |           |           |           |  |      |      |      |             |           |           |           |      |      |      |      |            |           |           |          
|                                                 |                     |                | Total domestic                                        |           |           | 3,457,942 |  |      |      | 4.74 |             |           |           | 3,596,167 |  |      |      | 4.91 |             |           |           | 3,650,283 |      |      |      | 5.25 |            |           |           | 3,546,701 |  |      |      | 5.36 |            |           |           | 2,997,260 |  |      |      | 4.75 |  
|                                                 | Foreign (e):        |                |                                                       |           |           |           |  |      |      |      |             |           |           |           |  |      |      |      |             |           |           |           |      |      |      |      |            |           |           |           |  |      |      |      |            |           |           |           |  |      |     
|                                                 |                     | Credit card    |                                                       |           | 455,714   |           |  |      | 3.05 |      |             |           | 317,684   |           |  |      | 2.74 |      |             |           | 327,625   |           |      |      | 3.65 |      |            |           | 264,859   |           |  |      | 3.98 |      |            |           | 182,804   |           |  |      | 3.24 |     
|                                                 |                     | Other consumer |                                                       |           |          |           |  |      |     |      |             |           |          |           |  |      |     |      |             |           |          |           |      |      |     |      |            |           |          |           |  |      |     |      |            |           | 2,794     |           |  |      | 4.11 |     
|                                                 |                     | Commercial     |                                                       |           |          |           |  |      |     |      |             |           |          |           |  |      |     |      |             |           |          |           |      |      |     |      |            |           |          |           |  |      |     |      |            |           |          |           |  |      |     |     
|                                                 |                     |                |                                                       |           |           |           |  |      |      |      |             |           |           |           |  |      |      |      |             |           |           |           |      |      |      |      |            |           |           |          
|                                                 |                     |                | Total foreign                                         |           |           | 455,714   |  |      |      | 3.05 |             |           |           | 317,684   |  |      |      | 2.74 |             |           |           | 327,625   |      |      |      | 3.65 |            |           |           | 264,859   |  |      |      | 3.98 |            |           |           | 185,598   |  |      |      | 3.25 |  
|                                                 |                     |                |                                                       |           |           |           |  |      |      |      |             |           |           |           |  |      |      |      |             |           |           |           |      |      |      |      |            |           |           |          
|                                                 |                     |                | Total securitized loans delinquent by geographic area |           | $         | 3,913,656 |  |      |      | 4.45 |             |           | $         | 3,913,851 |  |      |      | 4.61 |             |           | $         | 3,977,908 |      |      |      | 5.07 |            |           | $         | 3,811,560 |  |      |      | 5.23 |            |           | $         | 3,182,858 |  |      |      | 4.62 |  
|                                                 |                     |                |                                                       |           |           |           |  |      |      |      |             |           |           |           |  |      |      |      |             |           |           |           |      |      |      |      |            |           |           |          
|Managed Loans                                    |                     |                |                                                       |           |           |           |  |      |      |      |             |           |           |           |  |      |      |      |             |           |           |           |      |      |      |      |            |           |           |           |  |      |      |      |            |           |           |           |  |     
|Managed loans outstanding                        |                     | $              | 121,618,175                                           |           |           |           |  |      |      | $    | 118,493,560 |           |           |           |  |      |      | $    | 107,257,842 |           |           |           |      |      |      | $    | 97,496,051 |           |           |           |  |      |      | $    | 88,790,721 |           |           |           |  |     
|Managed loans delinquent:                        |                     |                |                                                       |           |           |           |  |      |      |      |             |           |           |           |  |      |      |      |             |           |           |           |      |      |      |      |            |           |           |           |  |      |      |      |            |           |           |           |  |     
|                                                 | 30 to 59 days       |                | $                                                     | 1,690,415 |           |           |  | 1.39 | %    |      | $           | 1,664,496 |           |           |  | 1.40 | %    |      | $           | 1,814,690 |           |           |      | 1.69 | %    |      | $          | 1,816,893 |           |           |  | 1.86 | %    |      | $          | 1,492,296 |           |           |  | 1.68 | %   
|                                                 | 60 to 89 days       |                |                                                       | 1,103,814 |           |           |  | .91  |      |      |             | 1,096,284 |           |           |  | .93  |      |      |             | 1,117,914 |           |           |      | 1.04 |      |      |            | 1,039,861 |           |           |  | 1.07 |      |      |            | 846,762   |           |           |  | .95  |     
|                                                 | 90 or more days (d) |                |                                                       | 2,230,868 |           |           |  | 1.83 |      |      |             | 2,442,870 |           |           |  | 2.06 |      |      |             | 2,296,907 |           |           |      | 2.15 |      |      |            | 2,105,707 |           |           |  | 2.16 |      |      |            | 1,647,480 |           |           |  | 1.86 |     
|                                                 |                     |                |                                                       |           |           |           |  |      |      |      |             |           |           |           |  |      |      |      |             |           |           |           |      |      |      |      |            |           |           |          
|                                                 |                     |                | Total managed loans delinquent                        |           | $         | 5,025,097 |  |      |      | 4.13 | %           |           | $         | 5,203,650 |  |      |      | 4.39 | %           |           | $         | 5,229,511 |      |      |      | 4.88 | %          |           | $         | 4,962,461 |  |      |      | 5.09 | %          |           | $         | 3,986,538 |  |      |      | 4.49 | %
|                                                 |                     |                |                                                       |           |           |           |  |      |      |      |             |           |           |           |  |      |      |      |             |           |           |           |      |      |      |      |            |           |           |          
|Managed loans delinquent by geographic area:     |                     |                |                                                       |           |           |           |  |      |      |      |             |           |           |           |  |      |      |      |             |           |           |           |      |      |      |      |            |           |           |           |  |      |      |      |            |           |           |           |  |     
|                                                 | Domestic (e):       |                |                                                       |           |           |           |  |      |      |      |             |           |           |           |  |      |      |      |             |           |           |           |      |      |      |      |            |           |           |           |  |      |      |      |            |           |           |           |  |      |     
|                                                 |                     | Credit card    |                                                       | $         | 3,687,254 |           |  |      | 4.60 | %    |             | $         | 3,967,407 |           |  |      | 4.72 | %    |             | $         | 3,909,249 |           |      |      | 5.01 | %    |            | $         | 3,736,365 |           |  |      | 5.07 | %    |            | $         | 3,160,471 |           |  |      | 4.54 | %   
|                                                 |                     | Other consumer |                                                       |           | 589,437   |           |  |      | 5.12 |      |             |           | 685,244   |           |  |      | 6.07 |      |             |           | 790,767   |           |      |      | 6.67 |      |            |           | 809,208   |           |  |      | 6.91 |      |            |           | 543,952   |           |  |      | 5.78 |     
|                                                 |                     | Commercial     |                                                       |           | 81,510    |           |  |      | 2.18 |      |             |           | 58,135    |           |  |      | 2.53 |      |             |           | 64,823    |           |      |      | 4.19 |      |            |           | 44,699    |           |  |      | 3.57 |      |            |           | 28,757    |           |  |      | 3.16 |     
|                                                 |                     |                |                                                       |           |           |           |  |      |      |      |             |           |           |           |  |      |      |      |             |           |           |           |      |      |      |      |            |           |           |          
|                                                 |                     |                | Total domestic                                        |           |           | 4,358,201 |  |      |      | 4.57 |             |           |           | 4,710,786 |  |      |      | 4.82 |             |           |           | 4,764,839 |      |      |      | 5.21 |            |           |           | 4,590,272 |  |      |      | 5.29 |            |           |           | 3,733,180 |  |      |      | 4.67 |  
|                                                 | Foreign (e):        |                |                                                       |           |           |           |  |      |      |      |             |           |           |           |  |      |      |      |             |           |           |           |      |      |      |      |            |           |           |           |  |      |      |      |            |           |           |           |  |      |     
|                                                 |                     | Credit card    |                                                       |           | 595,247   |           |  |      | 2.74 |      |             |           | 442,576   |           |  |      | 2.41 |      |             |           | 429,475   |           |      |      | 3.10 |      |            |           | 346,485   |           |  |      | 3.67 |      |            |           | 233,226   |           |  |      | 3.03 |     
|                                                 |                     | Other consumer |                                                       |           | 45,396    |           |  |      | 1.39 |      |             |           | 49,895    |           |  |      | 2.06 |      |             |           | 35,197    |           |      |      | 1.83 |      |            |           | 25,704    |           |  |      | 1.91 |      |            |           | 20,132    |           |  |      | 1.75 |     
|                                                 |                     | Commercial     |                                                       |           | 26,253    |           |  |      | 2.14 |      |             |           | 393       |           |  |      | 1.03 |      |             |           |          |           |      |      |     |      |            |           |          |           |  |      |     |      |            |           |          |           |  |      |     |     
|                                                 |                     |                |                                                       |           |           |           |  |      |      |      |             |           |           |           |  |      |      |      |             |           |           |           |      |      |      |      |            |           |           |          
|                                                 |                     |                | Total foreign                                         |           |           | 666,896   |  |      |      | 2.54 |             |           |           | 492,864   |  |      |      | 2.37 |             |           |           | 464,672   |      |      |      | 2.94 |            |           |           | 372,189   |  |      |      | 3.45 |            |           |           | 253,358   |  |      |      | 2.87 |  
|                                                 |                     |                |                                                       |           |           |           |  |      |      |      |             |           |           |           |  |      |      |      |             |           |           |           |      |      |      |      |            |           |           |          
|                                                 |                     |                | Total managed loans delinquent by geographic area     |           | $         | 5,025,097 |  |      |      | 4.13 |             |           | $         | 5,203,650 |  |      |      | 4.39 |             |           | $         | 5,229,511 |      |      |      | 4.88 |            |           | $         | 4,962,461 |  |      |      | 5.09 |            |           | $         | 3,986,538 |  |      |      | 4.49 |  
|                                                 |                     |                |                                                       |           |           |           |  |      |      |      |             |           |           |           |  |      |      |      |             |           |           |           |      |      |      |      |            |           |           |          
|                                                 |                     |                |                                                       |           |           |           |  |      |      |      |             |           |           |           |  |      |      |      |             |           |           |           |      |      |      |      |            |           |           |          





|    |  |                                                                                                                                                                                                                                                                                                                                                                                                               
|--- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) |  | Amounts exclude nonaccrual loans, which are presented in
    Table 17.                                                                                                                                                                                                                                                                                                                                        
|(b) |  | The Corporation considers these loans and other factors in
    determining an appropriate reserve for possible credit losses
    and the estimate of uncollectible accrued interest and fees.                                                                                                                                                                                                                 
|(c) |  | In September 2002, the Corporation changed the estimated value
    of accrued interest and fees. Excluding the change in the
    estimated value of accrued interest and fees in 2002,
    delinquency on loan receivables and managed loans would have
    been 4.66% and 5.19%, respectively, at December 31, 2002.                                                                                         
|(d) |  | See Table 16 for further detail on accruing loans past due
    90 days or more.                                                                                                                                                                                                                                                                                                                               
|(e) |  | The Corporation reclassified certain loan products to separately
    report its commercial loan products. Business card products were
    reclassified from credit card loans to commercial loans, and all
    other commercial loan products were reclassified from other
    consumer loans to commercial loans. For purposes of
    comparability, certain prior period amounts have been
    reclassified.







---



##### 

















---



##### 



TABLE 16: ACCRUING LOANS PAST DUE 90 DAYS OR
MORE (a) (b) (c) (dollars
in thousands)


|                  |               |                |                |                         |           |           |           |      |           |           |           |   |           |           |           |   |           |           |           |   |           |           |           | 
|----------------- | ------------- | -------------- | -------------- | ----------------------- | --------- | --------- | --------- | ---- | --------- | --------- | --------- | - | --------- | --------- | --------- | - | --------- | --------- | --------- | - | --------- | --------- | --------- | 
|December 31,      |               | 2004           |                |                         | 2003      |           |           | 2002 |           |           | 2001      |   |           | 2000      |          
|                  |              
|Loan Receivables  |               |                |                |                         |           |           |           |      |           |           |           |   |           |           |           |   |           |           |           |  
|                  | Domestic (d): |                |                |                         |           |           |           |      |           |           |           |   |           |           |           |   |           |           |           |   |          
|                  |               | Credit card    |                | $                       | 261,415   |           |           | $    | 358,786   |           |           | $ | 294,971   |           |           | $ | 273,075   |           |           | $ | 227,883   |          
|                  |               | Other consumer |                |                         | 135,389   |           |           |      | 163,701   |           |           |   | 178,879   |           |           |   | 150,021   |           |           |   | 69,915    |          
|                  |               | Commercial     |                |                         | 19,334    |           |           |      | 7,496     |           |           |   | 15,941    |           |           |   | 17,000    |           |           |   | 8,144     |          
|                  |               |                |                |                         |           |           |           |      |           |           |           |   |           |           |          
|                  |               |                | Total domestic |                         |           | 416,138   |           |      |           | 529,983   |           |   |           | 489,791   |           |   |           | 440,096   |           |   |           | 305,942   |          
|                  | Foreign (d):  |                |                |                         |           |           |           |      |           |           |           |   |           |           |           |   |           |           |           |   |          
|                  |               | Credit card    |                |                         | 44,404    |           |           |      | 41,669    |           |           |   | 39,985    |           |           |   | 28,657    |           |           |   | 18,430    |          
|                  |               | Other consumer |                |                         | 9,270     |           |           |      | 10,838    |           |           |   | 8,813     |           |           |   | 6,152     |           |           |   | 4,918     |          
|                  |               | Commercial     |                |                         | 10,590    |           |           |      | 115       |           |           |   |          |           |           |   |          |           |           |   |          |          
|                  |               |                |                |                         |           |           |           |      |           |           |           |   |           |           |          
|                  |               |                | Total foreign  |                         |           | 64,264    |           |      |           | 52,622    |           |   |           | 48,798    |           |   |           | 34,809    |           |   |           | 23,348    |          
|                  |               |                |                |                         |           |           |           |      |           |           |           |   |           |           |          
|                  |               |                |                | Total loan receivables  |           | $         | 480,402   |      |           | $         | 582,605   |   |           | $         | 538,589   |   |           | $         | 474,905   |   |           | $         | 329,290   | 
|                  |               |                |                |                         |           |           |           |      |           |           |           |   |           |           |          
|Securitized Loans |               |                |                |                         |           |           |           |      |           |           |           |   |           |           |           |   |           |           |           |  
|                  | Domestic (d): |                |                |                         |           |           |           |      |           |           |           |   |           |           |           |   |           |           |           |   |          
|                  |               | Credit card    |                | $                       | 1,407,333 |           |           | $    | 1,545,233 |           |           | $ | 1,420,645 |           |           | $ | 1,331,890 |           |           | $ | 1,088,991 |          
|                  |               | Other consumer |                |                         | 157,181   |           |           |      | 174,314   |           |           |   | 186,256   |           |           |   | 184,539   |           |           |   | 156,326   |          
|                  |               | Commercial     |                |                         | 19,680    |           |           |      | 18,486    |           |           |   | 8,877     |           |           |   |          |           |           |   |          |          
|                  |               |                |                |                         |           |           |           |      |           |           |           |   |           |           |          
|                  |               |                | Total domestic |                         |           | 1,584,194 |           |      |           | 1,738,033 |           |   |           | 1,615,778 |           |   |           | 1,516,429 |           |   |           | 1,245,317 |          
|                  | Foreign (d):  |                |                |                         |           |           |           |      |           |           |           |   |           |           |           |   |           |           |           |   |          
|                  |               | Credit card    |                |                         | 166,272   |           |           |      | 122,232   |           |           |   | 142,540   |           |           |   | 114,373   |           |           |   | 71,810    |          
|                  |               | Other consumer |                |                         |          |           |           |      |          |           |           |   |          |           |           |   |          |           |           |   | 1,063     |          
|                  |               | Commercial     |                |                         |          |           |           |      |          |           |           |   |          |           |           |   |          |           |           |   |          |          
|                  |               |                |                |                         |           |           |           |      |           |           |           |   |           |           |          
|                  |               |                | Total foreign  |                         |           | 166,272   |           |      |           | 122,232   |           |   |           | 142,540   |           |   |           | 114,373   |           |   |           | 72,873    |          
|                  |               |                |                |                         |           |           |           |      |           |           |           |   |           |           |          
|                  |               |                |                | Total securitized loans |           | $         | 1,750,466 |      |           | $         | 1,860,265 |   |           | $         | 1,758,318 |   |           | $         | 1,630,802 |   |           | $         | 1,318,190 | 
|                  |               |                |                |                         |           |           |           |      |           |           |           |   |           |           |          
|Managed Loans     |               |                |                |                         |           |           |           |      |           |           |           |   |           |           |           |   |           |           |           |  
|                  | Domestic (d): |                |                |                         |           |           |           |      |           |           |           |   |           |           |           |   |           |           |           |   |          
|                  |               | Credit card    |                | $                       | 1,668,748 |           |           | $    | 1,904,019 |           |           | $ | 1,715,616 |           |           | $ | 1,604,965 |           |           | $ | 1,316,874 |          
|                  |               | Other consumer |                |                         | 292,570   |           |           |      | 338,015   |           |           |   | 365,135   |           |           |   | 334,560   |           |           |   | 226,241   |          
|                  |               | Commercial     |                |                         | 39,014    |           |           |      | 25,982    |           |           |   | 24,818    |           |           |   | 17,000    |           |           |   | 8,144     |          
|                  |               |                |                |                         |           |           |           |      |           |           |           |   |           |           |          
|                  |               |                | Total domestic |                         |           | 2,000,332 |           |      |           | 2,268,016 |           |   |           | 2,105,569 |           |   |           | 1,956,525 |           |   |           | 1,551,259 |          
|                  | Foreign (d):  |                |                |                         |           |           |           |      |           |           |           |   |           |           |           |   |           |           |           |   |          
|                  |               | Credit card    |                |                         | 210,676   |           |           |      | 163,901   |           |           |   | 182,525   |           |           |   | 143,030   |           |           |   | 90,240    |          
|                  |               | Other consumer |                |                         | 9,270     |           |           |      | 10,838    |           |           |   | 8,813     |           |           |   | 6,152     |           |           |   | 5,981     |          
|                  |               | Commercial     |                |                         | 10,590    |           |           |      | 115       |           |           |   |          |           |           |   |          |           |           |   |          |          
|                  |               |                |                |                         |           |           |           |      |           |           |           |   |           |           |          
|                  |               |                | Total foreign  |                         |           | 230,536   |           |      |           | 174,854   |           |   |           | 191,338   |           |   |           | 149,182   |           |   |           | 96,221    |          
|                  |               |                |                |                         |           |           |           |      |           |           |           |   |           |           |          
|                  |               |                |                | Total managed loans     |           | $         | 2,230,868 |      |           | $         | 2,442,870 |   |           | $         | 2,296,907 |   |           | $         | 2,105,707 |   |           | $         | 1,647,480 | 
|                  |               |                |                |                         |           |           |           |      |           |           |           |   |           |           |          
|                 



|    |  |                                                                                                                                                                                                                                                                                                                                                                                                               
|--- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) |  | Amounts exclude nonaccrual loans, which are presented in
    Table 17.                                                                                                                                                                                                                                                                                                                                        
|(b) |  | This Table provides further detail on 90 days or more
    delinquent loans presented in Table 15.                                                                                                                                                                                                                                                                                                             
|(c) |  | The Corporation considers these loans and other factors in
    determining an appropriate reserve for possible credit losses
    and the estimate of uncollectible accrued interest and fees.                                                                                                                                                                                                                 
|(d) |  | The Corporation reclassified certain loan products to separately
    report its commercial loan products. Business card products were
    reclassified from credit card loans to commercial loans, and all
    other commercial loan products were reclassified from other
    consumer loans to commercial loans. For purposes of
    comparability, certain prior period amounts have been
    reclassified.



ACCRUING LOANS PAST DUE 90 DAYS OR MORE
  RENEGOTIATED LOAN PROGRAMS


Nonaccrual Loans








---



##### 



TABLE 17: NONACCRUAL LOANS
(a) (b) (dollars
in thousands)


|                                                                             |                |                |                         |         |         |         |     |         |         |         |      |         |         |         |     |         |         |         |     |         |         |         | 
|---------------------------------------------------------------------------- | -------------- | -------------- | ----------------------- | ------- | ------- | ------- | --- | ------- | ------- | ------- | ---- | ------- | ------- | ------- | --- | ------- | ------- | ------- | --- | ------- | ------- | ------- | 
|December 31,                                                                 |                | 2004           |                         |         | 2003    |         |     | 2002    |         |         | 2001 |         |         | 2000    |    
|                                                                            
|Loan Receivables                                                             |                |                |                         |         |         |         |     |         |         |         |      |         |         |         |     |         |         |         |     |        
|Domestic (c):                                                                |                |                |                         |         |         |         |     |         |         |         |      |         |         |         |     |         |         |         |     |        
|                                                                             | Credit card    |                | $                       | 3,508   |         |         | $   | 11,298  |         |         | $    | 47,548  |         |         | $   | 26,391  |         |         | $   | 19,617  |        
|                                                                             | Other consumer |                |                         | 475     |         |         |     | 1,053   |         |         |      | 2,481   |         |         |     | 2,043   |         |         |     | 2,628   |        
|                                                                             | Commercial     |                |                         | 5,181   |         |         |     | 1,816   |         |         |      | 770     |         |         |     | 1,179   |         |         |     | 1,871   |        
|                                                                             |                |                |                         |         |         |         |     |         |         |         |      |         |         |         |    
|                                                                             |                | Total domestic |                         |         | 9,164   |         |     |         | 14,167  |         |      |         | 50,799  |         |     |         | 29,613  |         |     |         | 24,116  |        
|Foreign (c):                                                                 |                |                |                         |         |         |         |     |         |         |         |      |         |         |         |     |         |         |         |     |        
|                                                                             | Credit card    |                |                         | 108,054 |         |         |     | 80,352  |         |         |      | 6,190   |         |         |     | 6,148   |         |         |     | 14,576  |        
|                                                                             | Other consumer |                |                         | 60,071  |         |         |     | 4,903   |         |         |      | 543     |         |         |     | 11      |         |         |     | 2,470   |        
|                                                                             | Commercial     |                |                         | 254     |         |         |     | 29      |         |         |      |        |         |         |     |        |         |         |     |        |        
|                                                                             |                |                |                         |         |         |         |     |         |         |         |      |         |         |         |    
|                                                                             |                | Total foreign  |                         |         | 168,379 |         |     |         | 85,284  |         |      |         | 6,733   |         |     |         | 6,159   |         |     |         | 17,046  |        
|                                                                             |                |                |                         |         |         |         |     |         |         |         |      |         |         |         |    
|                                                                             |                |                | Total loan receivables  |         | $       | 177,543 |     |         | $       | 99,451  |      |         | $       | 57,532  |     |         | $       | 35,772  |     |         | $       | 41,162  | 
|                                                                             |                |                |                         |         |         |         |     |         |         |         |      |         |         |         |    
|Nonaccrual loan receivables as a percentage of ending loan
    receivables   |                |                | .53                     | %       |         |         | .30 | %       |         |         | .20  | %       |         |         | .15 | %       |         |         | .21 | %      
|                                                                            
|Securitized Loans                                                            |                |                |                         |         |         |         |     |         |         |         |      |         |         |         |     |         |         |         |     |        
|Domestic (c):                                                                |                |                |                         |         |         |         |     |         |         |         |      |         |         |         |     |         |         |         |     |        
|                                                                             | Credit card    |                | $                       | 13,100  |         |         | $   | 45,097  |         |         | $    | 215,171 |         |         | $   | 120,494 |         |         | $   | 99,938  |        
|                                                                             | Other consumer |                |                         | 461     |         |         |     | 1,050   |         |         |      | 2,348   |         |         |     | 2,031   |         |         |     | 4,571   |        
|                                                                             | Commercial     |                |                         | 2,301   |         |         |     | 2,675   |         |         |      | 434     |         |         |     |        |         |         |     |        |        
|                                                                             |                |                |                         |         |         |         |     |         |         |         |      |         |         |         |    
|                                                                             |                | Total domestic |                         |         | 15,862  |         |     |         | 48,822  |         |      |         | 217,953 |         |     |         | 122,525 |         |     |         | 104,509 |        
|Foreign (c):                                                                 |                |                |                         |         |         |         |     |         |         |         |      |         |         |         |     |         |         |         |     |        
|                                                                             | Credit card    |                |                         | 235,005 |         |         |     | 129,140 |         |         |      | 11,798  |         |         |     | 15,528  |         |         |     | 44,716  |        
|                                                                             | Other consumer |                |                         |        |         |         |     |        |         |         |      |        |         |         |     |        |         |         |     | 166     |        
|                                                                             | Commercial     |                |                         |        |         |         |     |        |         |         |      |        |         |         |     |        |         |         |     |        |        
|                                                                             |                |                |                         |         |         |         |     |         |         |         |      |         |         |         |    
|                                                                             |                | Total foreign  |                         |         | 235,005 |         |     |         | 129,140 |         |      |         | 11,798  |         |     |         | 15,528  |         |     |         | 44,882  |        
|                                                                             |                |                |                         |         |         |         |     |         |         |         |      |         |         |         |    
|                                                                             |                |                | Total securitized loans |         | $       | 250,867 |     |         | $       | 177,962 |      |         | $       | 229,751 |     |         | $       | 138,053 |     |         | $       | 149,391 | 
|                                                                             |                |                |                         |         |         |         |     |         |         |         |      |         |         |         |    
|Nonaccrual securitized loans as a percentage of ending
    securitized loans |                |                | .29                     | %       |         |         | .21 | %       |         |         | .29  | %       |         |         | .19 | %       |         |         | .22 | %      
|                                                                            
|Managed Loans                                                                |                |                |                         |         |         |         |     |         |         |         |      |         |         |         |     |         |         |         |     |        
|Domestic (c):                                                                |                |                |                         |         |         |         |     |         |         |         |      |         |         |         |     |         |         |         |     |        
|                                                                             | Credit card    |                | $                       | 16,608  |         |         | $   | 56,395  |         |         | $    | 262,719 |         |         | $   | 146,885 |         |         | $   | 119,555 |        
|                                                                             | Other consumer |                |                         | 936     |         |         |     | 2,103   |         |         |      | 4,829   |         |         |     | 4,074   |         |         |     | 7,199   |        
|                                                                             | Commercial     |                |                         | 7,482   |         |         |     | 4,491   |         |         |      | 1,204   |         |         |     | 1,179   |         |         |     | 1,871   |        
|                                                                             |                |                |                         |         |         |         |     |         |         |         |      |         |         |         |    
|                                                                             |                | Total domestic |                         |         | 25,026  |         |     |         | 62,989  |         |      |         | 268,752 |         |     |         | 152,138 |         |     |         | 128,625 |        
|Foreign (c):                                                                 |                |                |                         |         |         |         |     |         |         |         |      |         |         |         |     |         |         |         |     |        
|                                                                             | Credit card    |                |                         | 343,059 |         |         |     | 209,492 |         |         |      | 17,988  |         |         |     | 21,676  |         |         |     | 59,292  |        
|                                                                             | Other consumer |                |                         | 60,071  |         |         |     | 4,903   |         |         |      | 543     |         |         |     | 11      |         |         |     | 2,636   |        
|                                                                             | Commercial     |                |                         | 254     |         |         |     | 29      |         |         |      |        |         |         |     |        |         |         |     |        |        
|                                                                             |                |                |                         |         |         |         |     |         |         |         |      |         |         |         |    
|                                                                             |                | Total foreign  |                         |         | 403,384 |         |     |         | 214,424 |         |      |         | 18,531  |         |     |         | 21,687  |         |     |         | 61,928  |        
|                                                                             |                |                |                         |         |         |         |     |         |         |         |      |         |         |         |    
|                                                                             |                |                | Total managed loans     |         | $       | 428,410 |     |         | $       | 277,413 |      |         | $       | 287,283 |     |         | $       | 173,825 |     |         | $       | 190,553 | 
|                                                                             |                |                |                         |         |         |         |     |         |         |         |      |         |         |         |    
|Nonaccrual managed loans as a percentage of ending managed loans             |                |                | .35                     | %       |         |         | .23 | %       |         |         | .27  | %       |         |         | .18 | %       |         |         | .21 | %      
|                                                                            



|    |  |                                                                                                                                                                                                                                                                                                                                                                                                               
|--- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) |  | Although nonaccrual loans are charged off consistent with the
    Corporations charge-off policy as described in Loan
    Quality Net Credit Losses, nonaccrual loans are not
    included in the delinquent loans presented in Tables 15 and 16
    and the other restructured loans, which are presented in Table
    18.                                                                               
|(b) |  | The Corporation considers these loans and other factors in
    determining an appropriate reserve for possible credit losses
    and the estimate of uncollectible accrued interest and fees.                                                                                                                                                                                                                 
|(c) |  | The Corporation reclassified certain loan products to separately
    report its commercial loan products. Business card products were
    reclassified from credit card loans to commercial loans, and all
    other commercial loan products were reclassified from other
    consumer loans to commercial loans. For purposes of
    comparability, certain prior period amounts have been
    reclassified.






Other Restructured Loans








---



##### 



TABLE 18: OTHER RESTRUCTURED
LOANS (a) (b) (c) (dollars
in thousands)


|                                                                                     |               |                |                |                         |           |           |           |      |           |           |           |   |           |           |           |   |           |           |           |   |           |           |           | 
|------------------------------------------------------------------------------------ | ------------- | -------------- | -------------- | ----------------------- | --------- | --------- | --------- | ---- | --------- | --------- | --------- | - | --------- | --------- | --------- | - | --------- | --------- | --------- | - | --------- | --------- | --------- | 
|December 31,                                                                         |               | 2004           |                |                         | 2003      |           |           | 2002 |           |           | 2001      |   |           | 2000      |          
|                                                                                     |              
|Loan Receivables                                                                     |               |                |                |                         |           |           |           |      |           |           |           |   |           |           |           |   |           |           |           |  
|                                                                                     | Domestic (d): |                |                |                         |           |           |           |      |           |           |           |   |           |           |           |   |           |           |           |   |          
|                                                                                     |               | Credit card    |                | $                       | 457,216   |           |           | $    | 562,128   |           |           | $ | 604,490   |           |           | $ | 508,952   |           |           | $ | 390,684   |          
|                                                                                     |               | Other consumer |                |                         | 195,728   |           |           |      | 229,175   |           |           |   | 299,789   |           |           |   | 255,152   |           |           |   | 124,237   |          
|                                                                                     |               | Commercial     |                |                         | 10,177    |           |           |      | 3,627     |           |           |   | 7,581     |           |           |   | 6,383     |           |           |   | 11,322    |          
|                                                                                     |               |                |                |                         |           |           |           |      |           |           |           |   |           |           |          
|                                                                                     |               |                | Total domestic |                         |           | 663,121   |           |      |           | 794,930   |           |   |           | 911,860   |           |   |           | 770,487   |           |   |           | 526,243   |          
|                                                                                     | Foreign (d):  |                |                |                         |           |           |           |      |           |           |           |   |           |           |           |   |           |           |           |   |          
|                                                                                     |               | Credit card    |                |                         | 13,234    |           |           |      | 34,653    |           |           |   | 44,910    |           |           |   | 29,917    |           |           |   | 12,300    |          
|                                                                                     |               | Other consumer |                |                         | 5,560     |           |           |      | 36,086    |           |           |   | 23,913    |           |           |   | 15,074    |           |           |   | 6,008     |          
|                                                                                     |               | Commercial     |                |                         |          |           |           |      |          |           |           |   |          |           |           |   |          |           |           |   |          |          
|                                                                                     |               |                |                |                         |           |           |           |      |           |           |           |   |           |           |          
|                                                                                     |               |                | Total foreign  |                         |           | 18,794    |           |      |           | 70,739    |           |   |           | 68,823    |           |   |           | 44,991    |           |   |           | 18,308    |          
|                                                                                     |               |                |                |                         |           |           |           |      |           |           |           |   |           |           |          
|                                                                                     |               |                |                | Total loan receivables  |           | $         | 681,915   |      |           | $         | 865,669   |   |           | $         | 980,683   |   |           | $         | 815,478   |   |           | $         | 544,551   | 
|                                                                                     |               |                |                |                         |           |           |           |      |           |           |           |   |           |           |          
|Other restructured loan receivables as a percentage of ending
    loan receivables   |               |                | 2.02           | %                       |           |           | 2.57      | %    |           |           | 3.41      | % |           |           | 3.31      | % |           |           | 2.73      | %
|Securitized Loans                                                                    |               |                |                |                         |           |           |           |      |           |           |           |   |           |           |           |   |           |           |           |  
|                                                                                     | Domestic (d): |                |                |                         |           |           |           |      |           |           |           |   |           |           |           |   |           |           |           |   |          
|                                                                                     |               | Credit card    |                | $                       | 2,317,629 |           |           | $    | 2,241,096 |           |           | $ | 2,751,539 |           |           | $ | 2,323,764 |           |           | $ | 1,814,810 |          
|                                                                                     |               | Other consumer |                |                         | 208,315   |           |           |      | 243,987   |           |           |   | 290,244   |           |           |   | 253,633   |           |           |   | 200,900   |          
|                                                                                     |               | Commercial     |                |                         | 4,156     |           |           |      | 5,235     |           |           |   | 4,220     |           |           |   |          |           |           |   |          |          
|                                                                                     |               |                |                |                         |           |           |           |      |           |           |           |   |           |           |          
|                                                                                     |               |                | Total domestic |                         |           | 2,530,100 |           |      |           | 2,490,318 |           |   |           | 3,046,003 |           |   |           | 2,577,397 |           |   |           | 2,015,710 |          
|                                                                                     | Foreign (d):  |                |                |                         |           |           |           |      |           |           |           |   |           |           |           |   |           |           |           |   |          
|                                                                                     |               | Credit card    |                |                         | 50,638    |           |           |      | 71,763    |           |           |   | 87,395    |           |           |   | 75,395    |           |           |   | 36,555    |          
|                                                                                     |               | Other consumer |                |                         |          |           |           |      |          |           |           |   |          |           |           |   |          |           |           |   | 404       |          
|                                                                                     |               | Commercial     |                |                         |          |           |           |      |          |           |           |   |          |           |           |   |          |           |           |   |          |          
|                                                                                     |               |                |                |                         |           |           |           |      |           |           |           |   |           |           |          
|                                                                                     |               |                | Total foreign  |                         |           | 50,638    |           |      |           | 71,763    |           |   |           | 87,395    |           |   |           | 75,395    |           |   |           | 36,959    |          
|                                                                                     |               |                |                |                         |           |           |           |      |           |           |           |   |           |           |          
|                                                                                     |               |                |                | Total securitized loans |           | $         | 2,580,738 |      |           | $         | 2,562,081 |   |           | $         | 3,133,398 |   |           | $         | 2,652,792 |   |           | $         | 2,052,669 | 
|                                                                                     |               |                |                |                         |           |           |           |      |           |           |           |   |           |           |          
|Other restructured securitized loans as a percentage of ending
    securitized loans |               |                | 2.94           | %                       |           |           | 3.02      | %    |           |           | 3.99      | % |           |           | 3.64      | % |           |           | 2.98      | %
|Managed Loans                                                                        |               |                |                |                         |           |           |           |      |           |           |           |   |           |           |           |   |           |           |           |  
|                                                                                     | Domestic (d): |                |                |                         |           |           |           |      |           |           |           |   |           |           |           |   |           |           |           |   |          
|                                                                                     |               | Credit card    |                | $                       | 2,774,845 |           |           | $    | 2,803,224 |           |           | $ | 3,356,029 |           |           | $ | 2,832,716 |           |           | $ | 2,205,494 |          
|                                                                                     |               | Other consumer |                |                         | 404,043   |           |           |      | 473,162   |           |           |   | 590,033   |           |           |   | 508,785   |           |           |   | 325,137   |          
|                                                                                     |               | Commercial     |                |                         | 14,333    |           |           |      | 8,862     |           |           |   | 11,801    |           |           |   | 6,383     |           |           |   | 11,322    |          
|                                                                                     |               |                |                |                         |           |           |           |      |           |           |           |   |           |           |          
|                                                                                     |               |                | Total domestic |                         |           | 3,193,221 |           |      |           | 3,285,248 |           |   |           | 3,957,863 |           |   |           | 3,347,884 |           |   |           | 2,541,953 |          
|                                                                                     | Foreign (d):  |                |                |                         |           |           |           |      |           |           |           |   |           |           |           |   |           |           |           |   |          
|                                                                                     |               | Credit card    |                |                         | 63,872    |           |           |      | 106,416   |           |           |   | 132,305   |           |           |   | 105,312   |           |           |   | 48,855    |          
|                                                                                     |               | Other consumer |                |                         | 5,560     |           |           |      | 36,086    |           |           |   | 23,913    |           |           |   | 15,074    |           |           |   | 6,412     |          
|                                                                                     |               | Commercial     |                |                         |          |           |           |      |          |           |           |   |          |           |           |   |          |           |           |   |          |          
|                                                                                     |               |                |                |                         |           |           |           |      |           |           |           |   |           |           |          
|                                                                                     |               |                | Total foreign  |                         |           | 69,432    |           |      |           | 142,502   |           |   |           | 156,218   |           |   |           | 120,386   |           |   |           | 55,267    |          
|                                                                                     |               |                |                |                         |           |           |           |      |           |           |           |   |           |           |          
|                                                                                     |               |                |                | Total managed loans     |           | $         | 3,262,653 |      |           | $         | 3,427,750 |   |           | $         | 4,114,081 |   |           | $         | 3,468,270 |   |           | $         | 2,597,220 | 
|                                                                                     |               |                |                |                         |           |           |           |      |           |           |           |   |           |           |          
|Other restructured managed loans as a percentage of ending
    managed loans         |               |                | 2.68           | %                       |           |           | 2.89      | %    |           |           | 3.84      | % |           |           | 3.56      | % |           |           | 2.93      | %
|                                                                                    



|    |  |                                                                                                                                                                                                                                                                                                                   
|--- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) |  | Other restructured loans presented in this Table exclude
    accruing loans past due 90 days or more and nonaccrual
    loans, which are presented in Tables 16 and 17,
    respectively.                                                                                                                         
|(b) |  | The Corporation considers these loans and other factors in
    determining an appropriate reserve for possible credit losses
    and the estimate of uncollectible accrued interest and fees.                                                                                                                     
|(c) |  | During the fourth quarter of 2004, there was a change in
    managements determination of the definition of other
    restructured loans. Prior period amounts have been reclassified.                                                                                                                           
|(d) |  | The Corporation reclassified certain loan products to separately
    report its commercial loan products. Business card products were
    reclassified from credit card loans to commercial loans, and all
    other commercial loan products were reclassified from other
    consumer loans to commercial loans.






RE-AGED LOANS








---



##### 





TABLE 19: RE-AGED
AMOUNTS (a) (dollars
in thousands)
 Year Ended December 31,
    
    2004
    
    2003
    
    2002Loan ReceivablesDomestic (b):Credit card
    
    $
    323,631
    
    
    $
    366,589
    
    
    $
    721,586Other consumer
    
    
    162,392
    
    
    
    235,353
    
    
    
    346,481Commercial
    
    
    5,373
    
    
    
    8,103
    
    
    
    15,221Total domestic
    
    
    491,396
    
    
    
    610,045
    
    
    
    1,083,288Foreign (b):Credit card
    
    
    72,332
    
    
    
    74,734
    
    
    
    50,795Other consumer
    
    
    34,416
    
    
    
    30,042
    
    
    
    20,705Commercial
    
    
    105
    
    
    
    
    
    
    
    Total foreign
    
    
    106,853
    
    
    
    104,776
    
    
    
    71,500Total loan receivables
    
    $
    598,249
    
    
    $
    714,821
    
    
    $
    1,154,788Securitized LoansDomestic (b):Credit card
    
    $
    1,597,380
    
    
    $
    1,751,944
    
    
    $
    3,591,453Other consumer
    
    
    163,374
    
    
    
    230,997
    
    
    
    332,735Commercial
    
    
    4,247
    
    
    
    5,752
    
    
    
    542Total domestic
    
    
    1,765,001
    
    
    
    1,988,693
    
    
    
    3,924,730Foreign (b):Credit card
    
    
    182,740
    
    
    
    148,013
    
    
    
    105,863Other consumer
    
    
    
    
    
    
    
    
    
    
    Commercial
    
    
    
    
    
    
    
    
    
    
    Total foreign
    
    
    182,740
    
    
    
    148,013
    
    
    
    105,863Total securitized loans
    
    $
    1,947,741
    
    
    $
    2,136,706
    
    
    $
    4,030,593Managed LoansDomestic (b):Credit card
    
    $
    1,921,011
    
    
    $
    2,118,533
    
    
    $
    4,313,039Other consumer
    
    
    325,766
    
    
    
    466,350
    
    
    
    679,216Commercial
    
    
    9,620
    
    
    
    13,855
    
    
    
    15,763Total domestic
    
    
    2,256,397
    
    
    
    2,598,738
    
    
    
    5,008,018Foreign (b):Credit card
    
    
    255,072
    
    
    
    222,747
    
    
    
    156,658Other consumer
    
    
    34,416
    
    
    
    30,042
    
    
    
    20,705Commercial
    
    
    105
    
    
    
    
    
    
    
    Total foreign
    
    
    289,593
    
    
    
    252,789
    
    
    
    177,363Total managed
    loans
    
    $
    2,545,990
    
    
    $
    2,851,527
    
    
    $
    5,185,381  (a)
    
    Re-aged loans that returned to delinquency status are included
    in the delinquency amounts presented in Tables 15 and 16,
    provided that the loans have not charged off.(b)
    
    The Corporation reclassified certain loan products to separately
    report its commercial loan products. Business card products were
    reclassified from credit card loans to commercial loans, and all
    other commercial loan products were reclassified from other
    consumer loans to commercial loans. For purposes of
    comparability, certain prior period amounts have been
    reclassified.


NET CREDIT LOSSES






---



##### 

















---



##### 



TABLE 20: NET CREDIT LOSS
RATIO (dollars in
thousands)


|                        |               |                |                |                         |               |           |           |            |            |            |             |  |      |               |      |   |            |           |           |            |            |            |               |  |       |            |      |   |           |           |           |   |            |            |             |  |      |      |      | 
|----------------------- | ------------- | -------------- | -------------- | ----------------------- | ------------- | --------- | --------- | ---------- | ---------- | ---------- | ----------- |  | ---- | ------------- | ---- | - | ---------- | --------- | --------- | ---------- | ---------- | ---------- | ------------- |  | ----- | ---------- | ---- | - | --------- | --------- | --------- | - | ---------- | ---------- | ----------- |  | ---- | ---- | ---- | 
|Year Ended December 31, |               | 2004           |                |                         | 2003          |           |           | 2002       |           
|                        |              
|                        |               | Net Credit     |                |                         | Average Loans |           |           | Net Credit |            |            | Net Credit  |  |      | Average Loans |      |   | Net Credit |           |           | Net Credit |            |            | Average Loans |  |       | Net Credit |     
|                        |               | Losses         |                |                         | Outstanding   |           |           | Loss Ratio |            |            | Losses      |  |      | Outstanding   |      |   | Loss Ratio |           |           | Losses     |            |            | Outstanding   |  |       | Loss Ratio |     
|                        |               |                |               
|Loan Receivables        |               |                |                |                         |               |           |           |            |            |            |             |  |      |               |      |   |            |           |           |            |            |            |               |  |       |            |      |   |           |           |           |   |            |            |             | 
|                        | Domestic (a): |                |                |                         |               |           |           |            |            |            |             |  |      |               |      |   |            |           |           |            |            |            |               |  |       |            |      |   |           |           |           |   |            |            |             |  |     
|                        |               | Credit card    |                | $                       | 600,414       |           |           | $          | 13,712,807 |            |             |  | 4.38 | %             |      | $ | 651,670    |           |           | $          | 13,633,341 |            |               |  | 4.78% |            |      | $ | 557,183   |           |           | $ | 12,369,662 |            |             |  | 4.50 | %   
|                        |               | Other consumer |                |                         | 414,644       |           |           |            | 5,593,131  |            |             |  | 7.41 |               |      |   | 475,831    |           |           |            | 6,104,789  |            |               |  | 7.79  |            |      |   | 421,511   |           |           |   | 6,191,971  |            |             |  | 6.81 |     
|                        |               | Commercial     |                |                         | 52,293        |           |           |            | 2,190,095  |            |             |  | 2.39 |               |      |   | 31,551     |           |           |            | 1,034,082  |            |               |  | 3.05  |            |      |   | 41,769    |           |           |   | 1,352,992  |            |             |  | 3.09 |     
|                        |               |                |                |                         |               |           |           |            |            |            |             |  |      |               |      |   |            |           |           |            |            |            |               |  |       |            |     
|                        |               |                | Total domestic |                         |               | 1,067,351 |           |            |            | 21,496,033 |             |  |      | 4.97          |      |   |            | 1,159,052 |           |            |            | 20,772,212 |               |  |       | 5.58       |      |   |           | 1,020,463 |           |   |            | 19,914,625 |             |  |      | 5.12 |     
|                        | Foreign (a):  |                |                |                         |               |           |           |            |            |            |             |  |      |               |      |   |            |           |           |            |            |            |               |  |       |            |      |   |           |           |           |   |            |            |             |  |     
|                        |               | Credit card    |                |                         | 144,394       |           |           |            | 5,466,831  |            |             |  | 2.64 |               |      |   | 135,420    |           |           |            | 5,296,873  |            |               |  | 2.56  |            |      |   | 91,069    |           |           |   | 3,782,733  |            |             |  | 2.41 |     
|                        |               | Other consumer |                |                         | 98,789        |           |           |            | 3,027,292  |            |             |  | 3.26 |               |      |   | 69,090     |           |           |            | 2,097,784  |            |               |  | 3.29  |            |      |   | 44,680    |           |           |   | 1,617,842  |            |             |  | 2.76 |     
|                        |               | Commercial     |                |                         | 13,642        |           |           |            | 1,065,631  |            |             |  | 1.28 |               |      |   | 134        |           |           |            | 16,949     |            |               |  | .79   |            |      |   |          |           |           |   |           |            |             |  |     |     
|                        |               |                |                |                         |               |           |           |            |            |            |             |  |      |               |      |   |            |           |           |            |            |            |               |  |       |            |     
|                        |               |                | Total foreign  |                         |               | 256,825   |           |            |            | 9,559,754  |             |  |      | 2.69          |      |   |            | 204,644   |           |            |            | 7,411,606  |               |  |       | 2.76       |      |   |           | 135,749   |           |   |            | 5,400,575  |             |  |      | 2.51 |     
|                        |               |                |                |                         |               |           |           |            |            |            |             |  |      |               |      |   |            |           |           |            |            |            |               |  |       |            |     
|                        |               |                |                | Total loan receivables  |               | $         | 1,324,176 |            |            | $          | 31,055,787  |  |      |               | 4.26 |   |            | $         | 1,363,696 |            |            | $          | 28,183,818    |  |       |            | 4.84 |   |           | $         | 1,156,212 |   |            | $          | 25,315,200  |  |      |      | 4.57 | 
|                        |               |                |                |                         |               |           |           |            |            |            |             |  |      |               |      |   |            |           |           |            |            |            |               |  |       |            |     
|Securitized Loans       |               |                |                |                         |               |           |           |            |            |            |             |  |      |               |      |   |            |           |           |            |            |            |               |  |       |            |      |   |           |           |           |   |            |            |             | 
|                        | Domestic (a): |                |                |                         |               |           |           |            |            |            |             |  |      |               |      |   |            |           |           |            |            |            |               |  |       |            |      |   |           |           |           |   |            |            |             |  |     
|                        |               | Credit card    |                | $                       | 3,343,368     |           |           | $          | 67,125,271 |            |             |  | 4.98 |               |      | $ | 3,496,344  |           |           | $          | 65,195,206 |            |               |  | 5.36  |            |      | $ | 3,110,560 |           |           | $ | 61,565,829 |            |             |  | 5.05 |     
|                        |               | Other consumer |                |                         | 443,521       |           |           |            | 5,670,127  |            |             |  | 7.82 |               |      |   | 504,555    |           |           |            | 5,682,404  |            |               |  | 8.88  |            |      |   | 474,122   |           |           |   | 5,703,851  |            |             |  | 8.31 |     
|                        |               | Commercial     |                |                         | 52,004        |           |           |            | 1,007,839  |            |             |  | 5.16 |               |      |   | 35,784     |           |           |            | 719,357    |            |               |  | 4.97  |            |      |   | 2,786     |           |           |   | 57,992     |            |             |  | 4.80 |     
|                        |               |                |                |                         |               |           |           |            |            |            |             |  |      |               |      |   |            |           |           |            |            |            |               |  |       |            |     
|                        |               |                | Total domestic |                         |               | 3,838,893 |           |            |            | 73,803,237 |             |  |      | 5.20          |      |   |            | 4,036,683 |           |            |            | 71,596,967 |               |  |       | 5.64       |      |   |           | 3,587,468 |           |   |            | 67,327,672 |             |  |      | 5.33 |     
|                        | Foreign (a):  |                |                |                         |               |           |           |            |            |            |             |  |      |               |      |   |            |           |           |            |            |            |               |  |       |            |      |   |           |           |           |   |            |            |             |  |     
|                        |               | Credit card    |                |                         | 437,131       |           |           |            | 13,237,014 |            |             |  | 3.30 |               |      |   | 338,786    |           |           |            | 10,094,189 |            |               |  | 3.36  |            |      |   | 247,915   |           |           |   | 7,391,059  |            |             |  | 3.35 |     
|                        |               | Other consumer |                |                         |              |           |           |            |           |            |             |  |     |               |      |   |           |           |           |            |           |            |               |  |      |            |      |   |          |           |           |   |           |            |             |  |     |     
|                        |               | Commercial     |                |                         |              |           |           |            |           |            |             |  |     |               |      |   |           |           |           |            |           |            |               |  |      |            |      |   |          |           |           |   |           |            |             |  |     |     
|                        |               |                |                |                         |               |           |           |            |            |            |             |  |      |               |      |   |            |           |           |            |            |            |               |  |       |            |     
|                        |               |                | Total foreign  |                         |               | 437,131   |           |            |            | 13,237,014 |             |  |      | 3.30          |      |   |            | 338,786   |           |            |            | 10,094,189 |               |  |       | 3.36       |      |   |           | 247,915   |           |   |            | 7,391,059  |             |  |      | 3.35 |     
|                        |               |                |                |                         |               |           |           |            |            |            |             |  |      |               |      |   |            |           |           |            |            |            |               |  |       |            |     
|                        |               |                |                | Total securitized loans |               | $         | 4,276,024 |            |            | $          | 87,040,251  |  |      |               | 4.91 |   |            | $         | 4,375,469 |            |            | $          | 81,691,156    |  |       |            | 5.36 |   |           | $         | 3,835,383 |   |            | $          | 74,718,731  |  |      |      | 5.13 | 
|                        |               |                |                |                         |               |           |           |            |            |            |             |  |      |               |      |   |            |           |           |            |            |            |               |  |       |            |     
|Managed Loans           |               |                |                |                         |               |           |           |            |            |            |             |  |      |               |      |   |            |           |           |            |            |            |               |  |       |            |      |   |           |           |           |   |            |            |             | 
|                        | Domestic (a): |                |                |                         |               |           |           |            |            |            |             |  |      |               |      |   |            |           |           |            |            |            |               |  |       |            |      |   |           |           |           |   |            |            |             |  |     
|                        |               | Credit card    |                | $                       | 3,943,782     |           |           | $          | 80,838,078 |            |             |  | 4.88 |               |      | $ | 4,148,014  |           |           | $          | 78,828,547 |            |               |  | 5.26  |            |      | $ | 3,667,743 |           |           | $ | 73,935,491 |            |             |  | 4.96 |     
|                        |               | Other consumer |                |                         | 858,165       |           |           |            | 11,263,258 |            |             |  | 7.62 |               |      |   | 980,386    |           |           |            | 11,787,193 |            |               |  | 8.32  |            |      |   | 895,633   |           |           |   | 11,895,822 |            |             |  | 7.53 |     
|                        |               | Commercial     |                |                         | 104,297       |           |           |            | 3,197,934  |            |             |  | 3.26 |               |      |   | 67,335     |           |           |            | 1,753,439  |            |               |  | 3.84  |            |      |   | 44,555    |           |           |   | 1,410,984  |            |             |  | 3.16 |     
|                        |               |                |                |                         |               |           |           |            |            |            |             |  |      |               |      |   |            |           |           |            |            |            |               |  |       |            |     
|                        |               |                | Total domestic |                         |               | 4,906,244 |           |            |            | 95,299,270 |             |  |      | 5.15          |      |   |            | 5,195,735 |           |            |            | 92,369,179 |               |  |       | 5.62       |      |   |           | 4,607,931 |           |   |            | 87,242,297 |             |  |      | 5.28 |     
|                        | Foreign (a):  |                |                |                         |               |           |           |            |            |            |             |  |      |               |      |   |            |           |           |            |            |            |               |  |       |            |      |   |           |           |           |   |            |            |             |  |     
|                        |               | Credit card    |                |                         | 581,525       |           |           |            | 18,703,845 |            |             |  | 3.11 |               |      |   | 474,206    |           |           |            | 15,391,062 |            |               |  | 3.08  |            |      |   | 338,984   |           |           |   | 11,173,792 |            |             |  | 3.03 |     
|                        |               | Other consumer |                |                         | 98,789        |           |           |            | 3,027,292  |            |             |  | 3.26 |               |      |   | 69,090     |           |           |            | 2,097,784  |            |               |  | 3.29  |            |      |   | 44,680    |           |           |   | 1,617,842  |            |             |  | 2.76 |     
|                        |               | Commercial     |                |                         | 13,642        |           |           |            | 1,065,631  |            |             |  | 1.28 |               |      |   | 134        |           |           |            | 16,949     |            |               |  | .79   |            |      |   |          |           |           |   |           |            |             |  |     |     
|                        |               |                |                |                         |               |           |           |            |            |            |             |  |      |               |      |   |            |           |           |            |            |            |               |  |       |            |     
|                        |               |                | Total foreign  |                         |               | 693,956   |           |            |            | 22,796,768 |             |  |      | 3.04          |      |   |            | 543,430   |           |            |            | 17,505,795 |               |  |       | 3.10       |      |   |           | 383,664   |           |   |            | 12,791,634 |             |  |      | 3.00 |     
|                        |               |                |                |                         |               |           |           |            |            |            |             |  |      |               |      |   |            |           |           |            |            |            |               |  |       |            |     
|                        |               |                |                | Total managed loans     |               | $         | 5,600,200 |            |            | $          | 118,096,038 |  |      |               | 4.74 |   |            | $         | 5,739,165 |            |            | $          | 109,874,974   |  |       |            | 5.22 |   |           | $         | 4,991,595 |   |            | $          | 100,033,931 |  |      |      | 4.99 | 
|                        |               |                |                |                         |               |           |           |            |            |            |             |  |      |               |      |   |            |           |           |            |            |            |               |  |       |            |     
|                       



|    |  |                                                                                                                                                                                                                                                                                                                                                                                                               
|--- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) |  | The Corporation reclassified certain loan products to separately
    report its commercial loan products. Business card products were
    reclassified from credit card loans to commercial loans, and all
    other commercial loan products were reclassified from other
    consumer loans to commercial loans. For purposes of
    comparability, certain prior period amounts have been
    reclassified.



RESERVE AND PROVISION FOR POSSIBLE CREDIT LOSSES











---



##### 



TABLE 21: RESERVE FOR POSSIBLE CREDIT
LOSSES (dollars in
thousands)


|                                                                         |                                       |               |                |                                            |                     |          |            |            |           |          |            |            |           |          |            |            |           |          |            |          |         |          |          |          |  
|------------------------------------------------------------------------ | ------------------------------------- | ------------- | -------------- | ------------------------------------------ | ------------------- | -------- | ---------- | ---------- | --------- | -------- | ---------- | ---------- | --------- | -------- | ---------- | ---------- | --------- | -------- | ---------- | -------- | ------- | -------- | -------- | -------- | -
|December 31,                                                             |                                       | 2004          |                |                                            | 2003                |          |            | 2002       |           |          | 2001       |            |           | 2000     |           
|                                                                         |                                      
|Reserve for possible credit losses, beginning of year                    |                                       | $             | 1,216,316      |                                            |                     | $        | 1,111,299  |            |           | $        | 833,423    |            |           | $        | 527,573    |            |           | $        | 516,261    |         
|                                                                         | Reserves acquired:                    |               |                |                                            |                     |          |            |            |           |          |            |            |           |          |            |            |           |          |            |          |        
|                                                                         |                                       | Domestic      |                |                                            | 53,249              |          |            |            | 58,736    |          |            |            | 66,587    |          |            |            | 11,621    |          |            |          | 64,726  |         
|                                                                         |                                       | Foreign       |                |                                            | 29,822              |          |            |            | 2,380     |          |            |            | 18,291    |          |            |            | 9,127     |          |            |          |        |         
|                                                                         |                                       |               |                |                                            |                     |          |            |            |           |          |            |            |           |          |           
|                                                                         |                                       |               |                | Total reserves acquired                    |                     |          | 83,071     |            |           |          | 61,116     |            |           |          | 84,878     |            |           |          | 20,748     |          |         |          | 64,726   |         
|                                                                         | Provision for possible credit losses: |               |                |                                            |                     |          |            |            |           |          |            |            |           |          |            |            |           |          |            |          |        
|                                                                         |                                       | Domestic      |                |                                            | 890,686             |          |            |            | 1,189,344 |          |            |            | 1,153,486 |          |            |            | 1,028,047 |          |            |          | 477,630 |         
|                                                                         |                                       | Foreign       |                |                                            | 256,169             |          |            |            | 203,357   |          |            |            | 186,671   |          |            |            | 112,568   |          |            |          | 69,679  |         
|                                                                         |                                       |               |                |                                            |                     |          |            |            |           |          |            |            |           |          |           
|                                                                         |                                       |               |                | Total provision for possible credit losses |                     |          | 1,146,855  |            |           |          | 1,392,701  |            |           |          | 1,340,157  |            |           |          | 1,140,615  |          |         |          | 547,309  |         
|                                                                         | Foreign currency translation          |               |                | 14,492                                     |                     |          |            | 14,896     |           |          |            | 9,053      |           |          |            | (499       | )         |          |            | (1,081   | )      
|                                                                         | Credit losses:                        |               |                |                                            |                     |          |            |            |           |          |            |            |           |          |            |            |           |          |            |          |        
|                                                                         |                                       | Domestic (a): |                |                                            |                     |          |            |            |           |          |            |            |           |          |            |            |           |          |            |          |         |         
|                                                                         |                                       |               | Credit card    |                                            |                     | (651,853 | )          |            |           | (699,941 | )          |            |           | (593,249 | )          |            |           | (514,715 | )          |          |         | (421,243 | )       
|                                                                         |                                       |               | Other consumer |                                            |                     | (445,090 | )          |            |           | (507,626 | )          |            |           | (445,580 | )          |            |           | (265,783 | )          |          |         | (138,892 | )       
|                                                                         |                                       |               | Commercial     |                                            |                     | (56,497  | )          |            |           | (34,044  | )          |            |           | (43,714  | )          |            |           | (26,403  | )          |          |         | (13,891  | )       
|                                                                         |                                       |               |                |                                            |                     |          |            |            |           |          |            |            |           |          |           
|                                                                         |                                       |               |                | Total domestic credit losses               |                     |          | (1,153,440 | )          |           |          | (1,241,611 | )          |           |          | (1,082,543 | )          |           |          | (806,901   | )        |         |          | (574,026 | )       
|                                                                         |                                       | Foreign (a):  |                |                                            |                     |          |            |            |           |          |            |            |           |          |            |            |           |          |            |          |         |         
|                                                                         |                                       |               | Credit card    |                                            |                     | (169,727 | )          |            |           | (158,905 | )          |            |           | (106,141 | )          |            |           | (84,405  | )          |          |         | (56,426  | )       
|                                                                         |                                       |               | Other consumer |                                            |                     | (112,343 | )          |            |           | (79,133  | )          |            |           | (50,884  | )          |            |           | (33,167  | )          |          |         | (16,405  | )       
|                                                                         |                                       |               | Commercial     |                                            |                     | (14,038  | )          |            |           | (137     | )          |            |           |         |            |            |           |         |            |          |         |         |         
|                                                                         |                                       |               |                |                                            |                     |          |            |            |           |          |            |            |           |          |           
|                                                                         |                                       |               |                | Total foreign credit losses                |                     |          | (296,108   | )          |           |          | (238,175   | )          |           |          | (157,025   | )          |           |          | (117,572   | )        |         |          | (72,831  | )       
|                                                                         |                                       |               |                |                                            |                     |          |            |            |           |          |            |            |           |          |           
|                                                                         |                                       |               |                |                                            | Total credit losses |          |            | (1,449,548 | )         |          |            | (1,479,786 | )         |          |            | (1,239,568 | )         |          |            | (924,473 | )       |          |          | (646,857 | )
|                                                                         | Recoveries:                           |               |                |                                            |                     |          |            |            |           |          |            |            |           |          |            |            |           |          |            |          |        
|                                                                         |                                       | Domestic (a): |                |                                            |                     |          |            |            |           |          |            |            |           |          |            |            |           |          |            |          |         |         
|                                                                         |                                       |               | Credit card    |                                            |                     | 51,439   |            |            |           | 48,271   |            |            |           | 36,066   |            |            |           | 36,629   |            |          |         | 28,300   |         
|                                                                         |                                       |               | Other consumer |                                            |                     | 30,446   |            |            |           | 31,795   |            |            |           | 24,069   |            |            |           | 11,938   |            |          |         | 8,799    |         
|                                                                         |                                       |               | Commercial     |                                            |                     | 4,204    |            |            |           | 2,493    |            |            |           | 1,945    |            |            |           | 1,545    |            |          |         | 1,079    |         
|                                                                         |                                       |               |                |                                            |                     |          |            |            |           |          |            |            |           |          |           
|                                                                         |                                       |               |                | Total domestic recoveries                  |                     |          | 86,089     |            |           |          | 82,559     |            |           |          | 62,080     |            |           |          | 50,112     |          |         |          | 38,178   |         
|                                                                         |                                       | Foreign (a):  |                |                                            |                     |          |            |            |           |          |            |            |           |          |            |            |           |          |            |          |         |         
|                                                                         |                                       |               | Credit card    |                                            |                     | 25,333   |            |            |           | 23,485   |            |            |           | 15,072   |            |            |           | 14,176   |            |          |         | 6,888    |         
|                                                                         |                                       |               | Other consumer |                                            |                     | 13,554   |            |            |           | 10,043   |            |            |           | 6,204    |            |            |           | 5,171    |            |          |         | 2,149    |         
|                                                                         |                                       |               | Commercial     |                                            |                     | 396      |            |            |           | 3        |            |            |           |         |            |            |           |         |            |          |         |         |         
|                                                                         |                                       |               |                |                                            |                     |          |            |            |           |          |            |            |           |          |           
|                                                                         |                                       |               |                | Total foreign recoveries                   |                     |          | 39,283     |            |           |          | 33,531     |            |           |          | 21,276     |            |           |          | 19,347     |          |         |          | 9,037    |         
|                                                                         |                                       |               |                |                                            |                     |          |            |            |           |          |            |            |           |          |           
|                                                                         |                                       |               |                |                                            | Total recoveries    |          |            | 125,372    |           |          |            | 116,090    |           |          |            | 83,356     |           |          |            | 69,459   |         |          |          | 47,215   |  
|                                                                         |                                       |               |                |                                            |                     |          |            |            |           |          |            |            |           |          |           
|                                                                         | Net credit losses                     |               |                | (1,324,176                                 | )                   |          |            | (1,363,696 | )         |          |            | (1,156,212 | )         |          |            | (855,014   | )         |          |            | (599,642 | )      
|                                                                         |                                       |               |                |                                            |                     |          |            |            |           |          |            |            |           |          |           
|Reserve for possible credit losses, end of year                          |                                       | $             | 1,136,558      |                                            |                     | $        | 1,216,316  |            |           | $        | 1,111,299  |            |           | $        | 833,423    |            |           | $        | 527,573    |         
|                                                                         |                                       |               |                |                                            |                     |          |            |            |           |          |            |            |           |          |           
|Net credit losses as a % of average loan receivables                     |                                       |               | 4.26           | %                                          |                     |          | 4.84       | %          |           |          | 4.57       | %          |           |          | 4.20       | %          |           |          | 3.38       | %       
|Reserve for possible credit losses as a % of ending loan
    receivables |                                       |               | 3.37           |                                            |                     |          | 3.62       |            |           |          | 3.87       |            |           |          | 3.38       |            |           |          | 2.64       |         
|Ending loan receivables                                                  |                                       | $             | 33,758,850     |                                            |                     | $        | 33,624,077 |            |           | $        | 28,726,508 |            |           | $        | 24,633,564 |            |           | $        | 19,954,837 |         
|Average loan receivables                                                 |                                       |               | 31,055,787     |                                            |                     |          | 28,183,818 |            |           |          | 25,315,200 |            |           |          | 20,339,388 |            |           |          | 17,718,148 |         
|                                                                        



|    |  |                                                                                                                                                                                                                                                                                                                                                                                                               
|--- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) |  | The Corporation reclassified certain loan products to separately
    report its commercial loan products. Business card products were
    reclassified from credit card loans to commercial loans, and all
    other commercial loan products were reclassified from other
    consumer loans to commercial loans. For purposes of
    comparability, certain prior period amounts have been
    reclassified.















---



##### 



TABLE 22: ALLOCATION OF THE RESERVE FOR POSSIBLE CREDIT
LOSSES (dollars in
thousands)


|              |                |                                                 |   |         |           |  |      |      |       |   |   |         |           |  |  |      |       |   |   |         |           |      |  |      |       |   |   |         |         |  |  |      |       |   |   |         |         |  |  |      |       |  
|------------- | -------------- | ----------------------------------------------- | - | ------- | --------- |  | ---- | ---- | ----- | - | - | ------- | --------- |  |  | ---- | ----- | - | - | ------- | --------- | ---- |  | ---- | ----- | - | - | ------- | ------- |  |  | ---- | ----- | - | - | ------- | ------- |  |  | ---- | ----- | -
|December 31,  |                | 2004                                            |   |         |           |  | 2003 |      |       |   |   | 2002    |           |  |  |      | 2001  |   |   |         |           | 2000 |  |      |      
|             
|             
|Domestic (a): |                |                                                 |   |         |           |  |      |      |       |   |   |         |           |  |  |      |       |   |   |         |           |      |  |      |       |   |   |         |         |  |  |      |       |   |   |         |         |  |  |     
|              | Credit card    |                                                 | $ | 482,134 |           |  |      | 42.4 | %     |   | $ | 592,578 |           |  |  | 48.7 | %     |   | $ | 496,152 |           |      |  | 44.6 | %     |   | $ | 562,377 |         |  |  | 67.5 | %     |   | $ | 385,339 |         |  |  | 73.0 | %    
|              | Other consumer |                                                 |   | 390,652 |           |  |      | 34.4 |       |   |   | 438,886 |           |  |  | 36.1 |       |   |   | 464,536 |           |      |  | 41.8 |       |   |   | 202,764 |         |  |  | 24.3 |       |   |   | 102,312 |         |  |  | 19.4 |      
|              | Commercial     |                                                 |   | 74,471  |           |  |      | 6.5  |       |   |   | 39,209  |           |  |  | 3.2  |       |   |   | 20,957  |           |      |  | 1.9  |       |   |   | 16,894  |         |  |  | 2.0  |       |   |   | 11,505  |         |  |  | 2.2  |      
|              |                |                                                 |   |         |           |  |      |      |       |   |   |         |           |  |  |      |       |   |   |         |           |      |  |      |       |   |   |         |         | 
|              |                | Domestic reserve for possible credit losses     |   |         | 947,257   |  |      |      | 83.3  |   |   |         | 1,070,673 |  |  |      | 88.0  |   |   |         | 981,645   |      |  |      | 88.3  |   |   |         | 782,035 |  |  |      | 93.8  |   |   |         | 499,156 |  |  |      | 94.6  |  
|Foreign (a):  |                |                                                 |   |         |           |  |      |      |       |   |   |         |           |  |  |      |       |   |   |         |           |      |  |      |       |   |   |         |         |  |  |      |       |   |   |         |         |  |  |     
|              | Credit card    |                                                 |   | 83,826  |           |  |      | 7.4  |       |   |   | 83,428  |           |  |  | 6.9  |       |   |   | 88,992  |           |      |  | 8.0  |       |   |   | 46,961  |         |  |  | 5.7  |       |   |   | 26,397  |         |  |  | 5.0  |      
|              | Other consumer |                                                 |   | 81,990  |           |  |      | 7.2  |       |   |   | 61,808  |           |  |  | 5.1  |       |   |   | 40,662  |           |      |  | 3.7  |       |   |   | 4,427   |         |  |  | .5   |       |   |   | 2,020   |         |  |  | .4   |      
|              | Commercial     |                                                 |   | 23,485  |           |  |      | 2.1  |       |   |   | 407     |           |  |  |     |       |   |   |        |           |      |  |     |       |   |   |        |         |  |  |     |       |   |   |        |         |  |  |     |      
|              |                |                                                 |   |         |           |  |      |      |       |   |   |         |           |  |  |      |       |   |   |         |           |      |  |      |       |   |   |         |         | 
|              |                | Foreign reserve for possible credit losses      |   |         | 189,301   |  |      |      | 16.7  |   |   |         | 145,643   |  |  |      | 12.0  |   |   |         | 129,654   |      |  |      | 11.7  |   |   |         | 51,388  |  |  |      | 6.2   |   |   |         | 28,417  |  |  |      | 5.4   |  
|              |                |                                                 |   |         |           |  |      |      |       |   |   |         |           |  |  |      |       |   |   |         |           |      |  |      |       |   |   |         |         | 
|              |                | Reserve for possible credit losses, end of year |   | $       | 1,136,558 |  |      |      | 100.0 | % |   | $       | 1,216,316 |  |  |      | 100.0 | % |   | $       | 1,111,299 |      |  |      | 100.0 | % |   | $       | 833,423 |  |  |      | 100.0 | % |   | $       | 527,573 |  |  |      | 100.0 | %
|              |                |                                                 |   |         |           |  |      |      |       |   |   |         |           |  |  |      |       |   |   |         |           |      |  |      |       |   |   |         |         | 
|             



|    |  |                                                                                                                                                                                                                                                                                                                                                                                                               
|--- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) |  | The Corporation reclassified certain loan products to separately
    report its commercial loan products. Business card products were
    reclassified from credit card loans to commercial loans, and all
    other commercial loan products were reclassified from other
    consumer loans to commercial loans. For purposes of
    comparability, certain prior period amounts have been
    reclassified.



ESTIMATE OF UNCOLLECTIBLE ACCRUED INTEREST AND FEES




TABLE 23: DIFFERENCE BETWEEN THE AMOUNT OF INTEREST AND FEES
THE CORPORATION WAS CONTRACTUALLY ENTITLED TO AND THE AMOUNTS
RECOGNIZED AS
REVENUE (a) (dollars
in thousands)
 Year Ended December 31,
    
    2004
    
    2003
    
    2002Domestic
    
    $
    907,129
    
    
    $
    1,099,791
    
    
    $
    1,342,362Foreign
    
    
    129,537
    
    
    
    85,326
    
    
    
    68,261Total
    
    $
    1,036,666
    
    
    $
    1,185,117
    
    
    $
    1,410,623  (a)
    
    Includes the valuation of securitized loans. CAPITAL ADEQUACY








---



##### 



DIVIDEND LIMITATIONS
   TABLE 24: SELECTED FINANCIAL RATIOS
 Year Ended December 31,
    
    2004
    
    2003
    
    2002Return on average total assets
    
    
    4.39
    %
    
    
    4.16
    %
    
    
    3.67
    %Return on average stockholders equity
    
    
    21.72
    
    
    
    22.98
    
    
    
    21.29Average stockholders equity to average total assets
    
    
    20.23
    
    
    
    18.09
    
    
    
    17.22Dividend payout ratio
    
    
    23.41
    
    
    
    20.11
    
    
    
    20.15  OFF-BALANCE SHEET ARRANGEMENTS
  OFF-BALANCE SHEET ASSET SECURITIZATION











---



##### 










IMPACT OF OFF-BALANCE SHEET ASSET SECURITIZATION TRANSACTIONS
ON THE CORPORATIONS RESULTS
    TABLE 25: RECONCILIATION OF INCOME STATEMENT DATA FOR THE
PERIOD TO MANAGED NET INTEREST INCOME, MANAGED PROVISION FOR
POSSIBLE CREDIT LOSSES, AND MANAGED OTHER OPERATING
INCOME (dollars in
thousands)
 Year Ended December 31,
    
    2004
    
    2003
    
    2002Net Interest IncomeNet interest income
    
    $
    2,536,801
    
    
    $
    2,350,373
    
    
    $
    2,074,575Securitization adjustments
    
    
    7,884,471
    
    
    
    7,854,265
    
    
    
    7,044,102Managed net interest income
    
    $
    10,421,272
    
    
    $
    10,204,638
    
    
    $
    9,118,677Provision for Possible Credit LossesProvision for possible credit losses
    
    $
    1,146,855
    
    
    $
    1,392,701
    
    
    $
    1,340,157Securitization adjustments
    
    
    4,276,024
    
    
    
    4,375,469
    
    
    
    3,835,383Managed provision for possible credit losses
    
    $
    5,422,879
    
    
    $
    5,768,170
    
    
    $
    5,175,540Other Operating IncomeOther operating income
    
    $
    8,258,386
    
    
    $
    7,825,480
    
    
    $
    6,752,923Securitization adjustments
    
    
    (3,608,447
    )
    
    
    (3,478,796
    )
    
    
    (3,208,719
    )Managed other operating income
    
    $
    4,649,939
    
    
    $
    4,346,684
    
    
    $
    3,544,204








---



##### 



TABLE 26: RECONCILIATION OF AVERAGE INTEREST-EARNING ASSETS
AND AVERAGE INTEREST-BEARING LIABILITIES TO AVERAGE MANAGED
INTEREST-EARNING ASSETS AND AVERAGE MANAGED INTEREST- BEARING
LIABILITIES (dollars in
thousands, yields and rates on a fully taxable equivalent
basis)


|                                     |  |         |             |  |        |      |       |           |      |   |            |  |  |        |             |  |           |  |       |         |  |   |            |  |  |           |             |  |  |  |       |   |  |   |            | 
|------------------------------------ |  | ------- | ----------- |  | ------ | ---- | ----- | --------- | ---- | - | ---------- |  |  | ------ | ----------- |  | --------- |  | ----- | ------- |  | - | ---------- |  |  | --------- | ----------- |  |  |  | ----- | - |  | - | ---------- | 
|Year Ended December 31,              |  |         | 2004        |  |        | 2003 |       |           | 2002 |  
|                                     | 
|                                     |  | Average |             |  | Yield/ |      |       | Income or |      |   | Average    |  |  | Yield/ |             |  | Income or |  |       | Average |  |   | Yield/     |  |  | Income or |            
|                                     |  | Balance |             |  | Rate   |      |       | Expense   |      |   | Balance    |  |  | Rate   |             |  | Expense   |  |       | Balance |  |   | Rate       |  |  | Expense   |            
|                                     |  |         |            
|Assets                              
|Net interest-earning assets          |  | $       | 47,622,866  |  |        |      | 8.55  | %         |      | $ | 4,069,608  |  |  | $      | 43,781,381  |  |           |  | 8.82  | %       |  | $ | 3,859,643  |  |  | $         | 37,442,931  |  |  |  | 9.83  | % |  | $ | 3,679,140  | 
|Securitization adjustments           |  |         | 82,990,500  |  |        |      | 11.88 |           |      |   | 9,855,669  |  |  |        | 77,855,940  |  |           |  | 12.18 |         |  |   | 9,484,680  |  |  |           | 70,910,552  |  |  |  | 12.52 |   |  |   | 8,877,207  | 
|                                     |  |         |             |  |        |      |       |           |      |   |            |  |  |        |             |  |           |  |       |         |  |   |            |  |  |           |            
|Managed interest-earning assets      |  | $       | 130,613,366 |  |        |      | 10.66 |           |      | $ | 13,925,277 |  |  | $      | 121,637,321 |  |           |  | 10.97 |         |  | $ | 13,344,323 |  |  | $         | 108,353,483 |  |  |  | 11.59 |   |  | $ | 12,556,347 | 
|                                     |  |         |             |  |        |      |       |           |      |   |            |  |  |        |             |  |           |  |       |         |  |   |            |  |  |           |            
|                                    
|Liabilities                         
|Net interest-bearing liabilities     |  | $       | 42,879,347  |  |        |      | 3.57  |           |      | $ | 1,531,818  |  |  | $      | 41,861,029  |  |           |  | 3.60  |         |  | $ | 1,508,511  |  |  | $         | 36,865,484  |  |  |  | 4.35  |   |  | $ | 1,603,495  | 
|Securitization adjustments           |  |         | 85,451,912  |  |        |      | 2.31  |           |      |   | 1,971,198  |  |  |        | 80,033,724  |  |           |  | 2.04  |         |  |   | 1,630,415  |  |  |           | 72,908,284  |  |  |  | 2.51  |   |  |   | 1,833,105  | 
|                                     |  |         |             |  |        |      |       |           |      |   |            |  |  |        |             |  |           |  |       |         |  |   |            |  |  |           |            
|Managed interest-bearing liabilities |  | $       | 128,331,259 |  |        |      | 2.73  |           |      | $ | 3,503,016  |  |  | $      | 121,894,753 |  |           |  | 2.58  |         |  | $ | 3,138,926  |  |  | $         | 109,773,768 |  |  |  | 3.13  |   |  | $ | 3,436,600  | 
|                                     |  |         |             |  |        |      |       |           |      |   |            |  |  |        |             |  |           |  |       |         |  |   |            |  |  |           |            
|                                    



Average Managed Interest-Earning Assets




Average Managed Interest-Bearing Liabilities






---



##### 



TABLE 27: RECONCILIATION OF THE NET INTEREST MARGIN RATIO TO
THE MANAGED NET INTEREST MARGIN
RATIO (dollars in
thousands)


|                                                   |       |         |             |             |              |      |          |            |      |         |         |      |   |              |             |             |        |         |   |            |  |  |              |       |   |        |             |             |  |  |   |           |  |  |  |      |  
|-------------------------------------------------- | ----- | ------- | ----------- | ----------- | ------------ | ---- | -------- | ---------- | ---- | ------- | ------- | ---- | - | ------------ | ----------- | ----------- | ------ | ------- | - | ---------- |  |  | ------------ | ----- | - | ------ | ----------- | ----------- |  |  | - | --------- |  |  |  | ---- | -
|Year Ended December 31,                            |       |         | 2004        |             |              | 2003 |          |            | 2002 |        
|                                                   |      
|                                                   |       | Net     |             |             |              |      | Net      |            |      |         |         | Net  |  
|                                                   |       | Average |             |             |              |      | Interest |            |      | Average |         |      |   |              | Interest    |             |        | Average |   |            |  |  | Interest     |      
|                                                   |       | Earning |             |             | Net Interest |      |          | Margin     |      |         | Earning |      |   | Net Interest |             |             | Margin |         |   | Earning    |  |  | Net Interest |       |   | Margin |            
|                                                   |       | Assets  |             |             | Income       |      |          | Ratio      |      |         | Assets  |      |   | Income       |             |             | Ratio  |         |   | Assets     |  |  | Income       |       |   | Ratio  |            
|                                                   |       |         |            
|Net Interest Margin (a)                            |       |         |             |             |              |      |          |            |      |         |         |      |   |              |             |             |        |         |   |            |  |  |              |       |   |        |             |             |  |  |   |           |  |  |  |     
|Investment securities and money market instruments |       | $       | 12,446,434  |             |              |      |          |            |      |         |         |      |   | $            | 11,693,550  |             |        |         |   |            |  |  |              |       |   | $      | 8,257,838   |             |  |  |   |           |  |  |  |     
|Other interest-earning assets                      |       |         | 4,120,645   |             |              |      |          |            |      |         |         |      |   |              | 3,904,013   |             |        |         |   |            |  |  |              |       |   |        | 3,869,893   |             |  |  |   |           |  |  |  |     
|Loan receivables (b)                               |       |         | 31,055,787  |             |              |      |          |            |      |         |         |      |   |              | 28,183,818  |             |        |         |   |            |  |  |              |       |   |        | 25,315,200  |             |  |  |   |           |  |  |  |     
|                                                   |       |         |             |             |              |      |          |            |      |         |         |      |   |              |             |             |        |         |   |            |  |  |              |       |   |        |            
|                                                   | Total |         | $           | 47,622,866  |              |      | $        | 2,537,790  |      |         |         | 5.33 | % |              | $           | 43,781,381  |        |         | $ | 2,351,132  |  |  |              | 5.37  | % |        | $           | 37,442,931  |  |  | $ | 2,075,645 |  |  |  | 5.54 | %
|                                                   |       |         |             |             |              |      |          |            |      |         |         |      |   |              |             |             |        |         |   |            |  |  |              |       |   |        |            
|Securitization Adjustments                         |       |         |             |             |              |      |          |            |      |         |         |      |   |              |             |             |        |         |   |            |  |  |              |       |   |        |             |             |  |  |   |           |  |  |  |     
|Investment securities and money market instruments |       | $       |            |             |              |      |          |            |      |         |         |      |   | $            |            |             |        |         |   |            |  |  |              |       |   | $      |            |             |  |  |   |           |  |  |  |     
|Other interest-earning assets                      |       |         | (4,049,751  | )           |              |      |          |            |      |         |         |      |   |              | (3,835,216  | )           |        |         |   |            |  |  |              |       |   |        | (3,808,179  | )           |  |  |   |           |  |  |  |     
|Securitized loans                                  |       |         | 87,040,251  |             |              |      |          |            |      |         |         |      |   |              | 81,691,156  |             |        |         |   |            |  |  |              |       |   |        | 74,718,731  |             |  |  |   |           |  |  |  |     
|                                                   |       |         |             |             |              |      |          |            |      |         |         |      |   |              |             |             |        |         |   |            |  |  |              |       |   |        |            
|                                                   | Total |         | $           | 82,990,500  |              |      |          | 7,884,471  |      |         |         | 9.50 |   |              | $           | 77,855,940  |        |         |   | 7,854,265  |  |  |              | 10.09 |   |        | $           | 70,910,552  |  |  |   | 7,044,102 |  |  |  | 9.93 |  
|                                                   |       |         |             |             |              |      |          |            |      |         |         |      |   |              |             |             |        |         |   |            |  |  |              |       |   |        |            
|Managed Net Interest Margin (a)                    |       |         |             |             |              |      |          |            |      |         |         |      |   |              |             |             |        |         |   |            |  |  |              |       |   |        |             |             |  |  |   |           |  |  |  |     
|Investment securities and money market instruments |       | $       | 12,446,434  |             |              |      |          |            |      |         |         |      |   | $            | 11,693,550  |             |        |         |   |            |  |  |              |       |   | $      | 8,257,838   |             |  |  |   |           |  |  |  |     
|Other interest-earning assets                      |       |         | 70,894      |             |              |      |          |            |      |         |         |      |   |              | 68,797      |             |        |         |   |            |  |  |              |       |   |        | 61,714      |             |  |  |   |           |  |  |  |     
|Managed loans                                      |       |         | 118,096,038 |             |              |      |          |            |      |         |         |      |   |              | 109,874,974 |             |        |         |   |            |  |  |              |       |   |        | 100,033,931 |             |  |  |   |           |  |  |  |     
|                                                   |       |         |             |             |              |      |          |            |      |         |         |      |   |              |             |             |        |         |   |            |  |  |              |       |   |        |            
|                                                   | Total |         | $           | 130,613,366 |              |      |          | 10,422,261 |      |         |         | 7.98 |   |              | $           | 121,637,321 |        |         |   | 10,205,397 |  |  |              | 8.39  |   |        | $           | 108,353,483 |  |  |   | 9,119,747 |  |  |  | 8.42 |  
|                                                   |       |         |             |             |              |      |          |            |      |         |         |      |   |              |             |             |        |         |   |            |  |  |              |       |   |        |            
|                                                  



|    |  |                                                                                                                                                                                                                                  
|--- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) |  | Net interest margin ratios are presented on a fully taxable
    equivalent basis. The fully taxable equivalent adjustment for
    the years ended December 31, 2004, 2003, and 2002 was $989,
    $759, and $1,070, respectively.
|(b) |  | Loan receivables include loans held for securitization and the
    loan portfolio.                                                                                                                                               















---



##### 



TABLE 28: RECONCILIATION OF THE AS REPORTED NET AND MANAGED
NET INTEREST MARGIN RATIOS TO THE NET AND MANAGED NET INTEREST
MARGIN RATIOS EXCLUDING THE CHANGE IN THE ESTIMATED VALUE OF
ACCRUED INTEREST AND FEES IN
2002 (dollars in
thousands)


|                                                                                     |       |         |             |             |              |  |          |           |  |  |  |       |  
|------------------------------------------------------------------------------------ | ----- | ------- | ----------- | ----------- | ------------ |  | -------- | --------- |  |  |  | ----- | -
|Year Ended December 31, 2002                                                         |       |         |             |             |              |  |         
|                                                                                     |      
|                                                                                     |       | Net     |            
|                                                                                     |       | Average |             |             |              |  | Interest |          
|                                                                                     |       | Earning |             |             | Net Interest |  |          | Margin    | 
|                                                                                     |       | Assets  |             |             | Income       |  |          | Ratio     | 
|                                                                                     |       |         |            
|As Reported                                                                          |       |         |             |             |              |  |          |           |  |  |  |      
|                                                                                    
|Net Interest Margin (a)                                                              |       |         |             |             |              |  |          |           |  |  |  |      
|Investment securities and money market instruments                                   |       | $       | 8,257,838   |             |              |  |          |           |  |  |  |      
|Other interest-earning assets                                                        |       |         | 3,869,893   |             |              |  |          |           |  |  |  |      
|Loan receivables (b)                                                                 |       |         | 25,315,200  |             |              |  |          |           |  |  |  |      
|                                                                                     |       |         |             |             |              |  |          |           | 
|                                                                                     | Total |         | $           | 37,442,931  |              |  | $        | 2,075,645 |  |  |  | 5.54  | %
|                                                                                     |       |         |             |             |              |  |          |           | 
|                                                                                    
|Securitization Adjustments                                                           |       |         |             |             |              |  |          |           |  |  |  |      
|Investment securities and money market instruments                                   |       | $       |            |             |              |  |          |           |  |  |  |      
|Other interest-earning assets                                                        |       |         | (3,808,179  | )           |              |  |          |           |  |  |  |      
|Securitized loans                                                                    |       |         | 74,718,731  |             |              |  |          |           |  |  |  |      
|                                                                                     |       |         |             |             |              |  |          |           | 
|                                                                                     | Total |         | $           | 70,910,552  |              |  |          | 7,044,102 |  |  |  | 9.93  |  
|                                                                                     |       |         |             |             |              |  |          |           | 
|                                                                                    
|Managed Net Interest Margin (a)                                                      |       |         |             |             |              |  |          |           |  |  |  |      
|Investment securities and money market instruments                                   |       | $       | 8,257,838   |             |              |  |          |           |  |  |  |      
|Other interest-earning assets                                                        |       |         | 61,714      |             |              |  |          |           |  |  |  |      
|Managed loans                                                                        |       |         | 100,033,931 |             |              |  |          |           |  |  |  |      
|                                                                                     |       |         |             |             |              |  |          |           | 
|                                                                                     | Total |         | $           | 108,353,483 |              |  |          | 9,119,747 |  |  |  | 8.42  |  
|                                                                                     |       |         |             |             |              |  |          |           | 
|                                                                                    
|Impact of the Change in the Estimated Value of Accrued
    Interest and Fees in 2002 |       |         |             |             |              |  |          |           |  |  |  |      
|                                                                                    
|Net Interest Margin (a)                                                              |       |         |             |             |              |  |          |           |  |  |  |      
|Investment securities and money market instruments                                   |       | $       |            |             |              |  |          |           |  |  |  |      
|Other interest-earning assets                                                        |       |         | 43,831      |             |              |  |          |           |  |  |  |      
|Loan receivables (b)                                                                 |       |         | 22,030      |             |              |  |          |           |  |  |  |      
|                                                                                     |       |         |             |             |              |  |          |           | 
|                                                                                     | Total |         | $           | 65,861      |              |  |          | 66,278    |  |  |  |       |  
|                                                                                     |       |         |             |             |              |  |          |           | 
|                                                                                    
|Securitization Adjustments                                                           |       |         |             |             |              |  |          |           |  |  |  |      
|Investment securities and money market instruments                                   |       | $       |            |             |              |  |          |           |  |  |  |      
|Other interest-earning assets                                                        |       |         | (43,831     | )           |              |  |          |           |  |  |  |      
|Securitized loans                                                                    |       |         | 71,386      |             |              |  |          |           |  |  |  |      
|                                                                                     |       |         |             |             |              |  |          |           | 
|                                                                                     | Total |         | $           | 27,555      |              |  |          | 211,383   |  |  |  |       |  
|                                                                                     |       |         |             |             |              |  |          |           | 
|                                                                                    
|Managed Net Interest Margin (a)                                                      |       |         |             |             |              |  |          |           |  |  |  |      
|Investment securities and money market instruments                                   |       | $       |            |             |              |  |          |           |  |  |  |      
|Other interest-earning assets                                                        |       |         |            |             |              |  |          |           |  |  |  |      
|Managed loans                                                                        |       |         | 93,416      |             |              |  |          |           |  |  |  |      
|                                                                                     |       |         |             |             |              |  |          |           | 
|                                                                                     | Total |         | $           | 93,416      |              |  |          | 277,661   |  |  |  |       |  
|                                                                                     |       |         |             |             |              |  |          |           | 
|                                                                                    
|Excluding the Change in the Estimated Value of Accrued
    Interest and Fees in 2002 |       |         |             |             |              |  |          |           |  |  |  |      
|                                                                                    
|Net Interest Margin (a)                                                              |       |         |             |             |              |  |          |           |  |  |  |      
|Investment securities and money market instruments                                   |       | $       | 8,257,838   |             |              |  |          |           |  |  |  |      
|Other interest-earning assets                                                        |       |         | 3,913,724   |             |              |  |          |           |  |  |  |      
|Loan receivables (b)                                                                 |       |         | 25,337,230  |             |              |  |          |           |  |  |  |      
|                                                                                     |       |         |             |             |              |  |          |           | 
|                                                                                     | Total |         | $           | 37,508,792  |              |  |          | 2,141,923 |  |  |  | 5.71  |  
|                                                                                     |       |         |             |             |              |  |          |           | 
|                                                                                    
|Securitization Adjustments                                                           |       |         |             |             |              |  |          |           |  |  |  |      
|Investment securities and money market instruments                                   |       | $       |            |             |              |  |          |           |  |  |  |      
|Other interest-earning assets                                                        |       |         | (3,852,010  | )           |              |  |          |           |  |  |  |      
|Securitized loans                                                                    |       |         | 74,790,117  |             |              |  |          |           |  |  |  |      
|                                                                                     |       |         |             |             |              |  |          |           | 
|                                                                                     | Total |         | $           | 70,938,107  |              |  |          | 7,255,485 |  |  |  | 10.23 |  
|                                                                                     |       |         |             |             |              |  |          |           | 
|                                                                                    
|Managed Net Interest Margin (a)                                                      |       |         |             |             |              |  |          |           |  |  |  |      
|Investment securities and money market instruments                                   |       | $       | 8,257,838   |             |              |  |          |           |  |  |  |      
|Other interest-earning assets                                                        |       |         | 61,714      |             |              |  |          |           |  |  |  |      
|Managed loans                                                                        |       |         | 100,127,347 |             |              |  |          |           |  |  |  |      
|                                                                                     |       |         |             |             |              |  |          |           | 
|                                                                                     | Total |         | $           | 108,446,899 |              |  |          | 9,397,408 |  |  |  | 8.67  |  
|                                                                                     |       |         |             |             |              |  |          |           | 
|                                                                                    



|    |  |                                                                                                                                                                               
|--- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) |  | Net interest margin ratios are presented on a fully taxable
    equivalent basis. The fully taxable equivalent adjustment for
    the year ended December 31, 2002 was $1,070.
|(b) |  | Loan receivables include loans held for securitization and the
    loan portfolio.                                                                                            







---



##### 



TABLE 29: PERCENTAGE OF MANAGED LOANS SECURITIZED BY LOAN
PRODUCT


|                  |                |                                  |      |      |      |      |  |      |      |  |  |      |      |  |      |      |      |  |  |      |      | 
|----------------- | -------------- | -------------------------------- | ---- | ---- | ---- | ---- |  | ---- | ---- |  |  | ---- | ---- |  | ---- | ---- | ---- |  |  | ---- | ---- | 
|December 31,      |                |                                  | 2004 |      |      | 2003 |  |      | 2002 |  |  | 2001 |      |  | 2000 |     
|                  |               
|Securitized Loans |                |                                  |      |      |      |      |  |      |      |  |  |      |      |  |      |      |      |  |  |     
|Domestic (a):     |                |                                  |      |      |      |      |  |      |      |  |  |      |      |  |      |      |      |  |  |     
|                  | Credit card    |                                  |      | 82.6 | %    |      |  | 79.2 | %    |  |  | 81.2 | %    |  |      | 82.0 | %    |  |  | 82.5 | %   
|                  | Other consumer |                                  |      | 49.2 |      |      |  | 50.3 |      |  |  | 47.9 |      |  |      | 48.7 |      |  |  | 60.4 |     
|                  | Commercial     |                                  |      | 26.9 |      |      |  | 43.8 |      |  |  | 32.5 |      |  |      |     |      |  |  |     |     
|                  |                | Total domestic securitized loans |      |      | 76.4 |      |  |      | 75.0 |  |  |      | 76.1 |  |      |      | 76.3 |  |  |      | 78.9 | 
|Foreign (a):      |                |                                  |      |      |      |      |  |      |      |  |  |      |      |  |      |      |      |  |  |     
|                  | Credit card    |                                  |      | 68.8 |      |      |  | 63.1 |      |  |  | 64.7 |      |  |      | 70.6 |      |  |  | 73.5 |     
|                  | Other consumer |                                  |      |     |      |      |  |     |      |  |  |     |      |  |      |     |      |  |  | 5.9  |     
|                  | Commercial     |                                  |      |     |      |      |  |     |      |  |  |     |      |  |      |     |      |  |  |     |     
|                  |                | Total foreign securitized loans  |      |      | 57.0 |      |  |      | 55.7 |  |  |      | 56.8 |  |      |      | 61.8 |  |  |      | 64.7 | 
|                  |                | Total securitized loans          |      |      | 72.2 |      |  |      | 71.6 |  |  |      | 73.2 |  |      |      | 74.7 |  |  |      | 77.5 | 
|                 



|    |  |                                                                                                                                                                                                                                                                                                                                                                                                               
|--- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) |  | The Corporation reclassified certain loan products to separately
    report its commercial loan products. Business card products were
    reclassified from credit card loans to commercial loans, and all
    other commercial loan products were reclassified from other
    consumer loans to commercial loans. For purposes of
    comparability, certain prior period amounts have been
    reclassified.



OFF-BALANCE SHEET ASSET SECURITIZATION TRANSACTION
ACTIVITY









TABLE 30: SECURITIZED LOANS
DISTRIBUTION (dollars
in thousands)


|                  |                |                                  |      |            |            |  |  |      |       |   |   |            |            |  |  |      |       |      |   |            |            |  |      |      |       |   |   |            |            |  |  |      |       |   |   |            |            |  |  |      |       |  
|----------------- | -------------- | -------------------------------- | ---- | ---------- | ---------- |  |  | ---- | ----- | - | - | ---------- | ---------- |  |  | ---- | ----- | ---- | - | ---------- | ---------- |  | ---- | ---- | ----- | - | - | ---------- | ---------- |  |  | ---- | ----- | - | - | ---------- | ---------- |  |  | ---- | ----- | -
|December 31,      |                |                                  | 2004 |            |            |  |  | 2003 |       |   |   |            | 2002       |  |  |      |       | 2001 |   |            |            |  | 2000 |      |       |  
|                  |               
|Securitized Loans |                |                                  |      |            |            |  |  |      |       |   |   |            |            |  |  |      |       |      |   |            |            |  |      |      |       |   |   |            |            |  |  |      |       |   |   |            |            |  |  |     
|Domestic (a):     |                |                                  |      |            |            |  |  |      |       |   |   |            |            |  |  |      |       |      |   |            |            |  |      |      |       |   |   |            |            |  |  |      |       |   |   |            |            |  |  |     
|                  | Credit card    |                                  | $    | 66,225,646 |            |  |  | 75.4 | %     |   | $ | 66,613,018 |            |  |  | 78.5 | %     |      | $ | 63,383,430 |            |  |      | 80.7 | %     |   | $ | 60,501,860 |            |  |  | 83.1 | %     |   | $ | 57,425,582 |            |  |  | 83.4 | %    
|                  | Other consumer |                                  |      | 5,664,384  |            |  |  | 6.5  |       |   |   | 5,671,832  |            |  |  | 6.7  |       |      |   | 5,677,908  |            |  |      | 7.2  |       |   |   | 5,702,658  |            |  |  | 7.8  |       |   |   | 5,691,769  |            |  |  | 8.3  |      
|                  | Commercial     |                                  |      | 1,007,324  |            |  |  | 1.1  |       |   |   | 1,007,804  |            |  |  | 1.2  |       |      |   | 503,446    |            |  |      | .7   |       |   |   |           |            |  |  |     |       |   |   |           |            |  |  |     |      
|                  |                |                                  |      |            |            |  |  |      |       |   |   |            |            |  |  |      |       |      |   |            |            |  |      |      |       |   |   |            |            | 
|                  |                | Total domestic securitized loans |      |            | 72,897,354 |  |  |      | 83.0  |   |   |            | 73,292,654 |  |  |      | 86.4  |      |   |            | 69,564,784 |  |      |      | 88.6  |   |   |            | 66,204,518 |  |  |      | 90.9  |   |   |            | 63,117,351 |  |  |      | 91.7  |  
|Foreign (a):      |                |                                  |      |            |            |  |  |      |       |   |   |            |            |  |  |      |       |      |   |            |            |  |      |      |       |   |   |            |            |  |  |      |       |   |   |            |            |  |  |     
|                  | Credit card    |                                  |      | 14,961,971 |            |  |  | 17.0 |       |   |   | 11,576,829 |            |  |  | 13.6 |       |      |   | 8,966,550  |            |  |      | 11.4 |       |   |   | 6,657,969  |            |  |  | 9.1  |       |   |   | 5,650,485  |            |  |  | 8.2  |      
|                  | Other consumer |                                  |      |           |            |  |  |     |       |   |   |           |            |  |  |     |       |      |   |           |            |  |      |     |       |   |   |           |            |  |  |     |       |   |   | 68,048     |            |  |  | .1   |      
|                  | Commercial     |                                  |      |           |            |  |  |     |       |   |   |           |            |  |  |     |       |      |   |           |            |  |      |     |       |   |   |           |            |  |  |     |       |   |   |           |            |  |  |     |      
|                  |                |                                  |      |            |            |  |  |      |       |   |   |            |            |  |  |      |       |      |   |            |            |  |      |      |       |   |   |            |            | 
|                  |                | Total foreign securitized loans  |      |            | 14,961,971 |  |  |      | 17.0  |   |   |            | 11,576,829 |  |  |      | 13.6  |      |   |            | 8,966,550  |  |      |      | 11.4  |   |   |            | 6,657,969  |  |  |      | 9.1   |   |   |            | 5,718,533  |  |  |      | 8.3   |  
|                  |                |                                  |      |            |            |  |  |      |       |   |   |            |            |  |  |      |       |      |   |            |            |  |      |      |       |   |   |            |            | 
|                  |                | Total securitized loans          |      | $          | 87,859,325 |  |  |      | 100.0 | % |   | $          | 84,869,483 |  |  |      | 100.0 | %    |   | $          | 78,531,334 |  |      |      | 100.0 | % |   | $          | 72,862,487 |  |  |      | 100.0 | % |   | $          | 68,835,884 |  |  |      | 100.0 | %
|                  |                |                                  |      |            |            |  |  |      |       |   |   |            |            |  |  |      |       |      |   |            |            |  |      |      |       |   |   |            |            | 
|                 



|    |  |                                                                                                                                                                                                                                                                                                                                                                                                               
|--- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) |  | The Corporation reclassified certain loan products to separately
    report its commercial loan products. Business card products were
    reclassified from credit card loans to commercial loans, and all
    other commercial loan products were reclassified from other
    consumer loans to commercial loans. For purposes of
    comparability, certain prior period amounts have been
    reclassified.

MBNA annual report 2004   61



---



##### 



TABLE 31: ESTIMATED MATURITIES OF INVESTOR
PRINCIPAL (dollars in
thousands)
 One year or less (a)
    
    $
    17,878,768Over one year through two years
    
    
    12,360,476Over two years through three years
    
    
    13,860,541Over three years through four years
    
    
    14,199,669Over four years through five years
    
    
    6,943,194Thereafter
    
    
    21,169,983Total amortization of investor principal
    
    
    86,412,631Estimated collectible billed interest and fees included in
    securitized loans
    
    
    1,446,694Total securitized loans
    
    $
    87,859,325  (a)
    
    The $4.9 billion MBNA Master Note Trust Emerald Program
    (Emerald Notes) and the £500.0 million UK
    Receivables Trust II Series 2004 VFN Program
    (Variable Funding Notes) are comprised of short-term
    commercial paper and are included in the one year or less
    category based on the possibility that maturing Emerald Notes
    and Variable Funding Notes cannot be re-issued. These events
    would cause the transactions to begin amortizing, thus creating
    a liquidity requirement. However, the Corporation expects the
    Emerald Notes and Variable Funding Notes to continue to be
    re-issued during the course of the program through the scheduled
    final maturity dates, which are scheduled to occur in 2006 and
    2009, respectively.  OTHER OFF-BALANCE SHEET ARRANGEMENTS


LIQUIDITY AND RATE SENSITIVITY
  LIQUIDITY MANAGEMENT


TABLE 32: SECURITIZATION TRUST YIELDS IN EXCESS OF MINIMUM
YIELD DATA (dollars in
thousands)


|                                       |  |                    |            |              |           |                                              |    |            |  |  |         |   |  |          |       |   |      |  |      |     |  |  |      |   |  |  |      |  
|-------------------------------------- |  | ------------------ | ---------- | ------------ | --------- | -------------------------------------------- | -- | ---------- |  |  | ------- | - |  | -------- | ----- | - | ---- |  | ---- | --- |  |  | ---- | - |  |  | ---- | -
|                                       |  |                    |            |              |           | For the Three Months Ended December 31, 2004 |   
|                                       | 
|                                       |  | Yield in Excess of |           
|                                       |  | Minimum Yield (a)  |           
|                                       |  |                    |           
|                                       |  |                    |            | Series Range |          
|                                       |  | Number             |            |              | Average   |                                              |    | Average    |  |  |         |   | 
|                                       |  | Investor           |            |              | of Series |                                              |    | Annualized |  |  | Minimum |   |  | Weighted |       |   |      | 
|                                       |  | Principal          |            |              | in Trust  |                                              |    | Yield      |  |  | Yield   |   |  | Average  |       |   | High |  |      | Low | 
|                                       | 
|MBNA Master Credit Card Trust II       |  | $                  | 22,894,657 |              |           |                                              | 31 |            |  |  | 18.44   | % |  |          | 9.91  | % |      |  | 8.53 | %   |  |  | 8.85 | % |  |  | 7.83 | %
|MBNA Credit Card Master Note Trust (b) |  |                    | 40,242,415 |              |           |                                              | 75 |            |  |  | 18.48   |   |  |          | 9.67  |   |      |  | 8.81 |     |  |  | 8.81 |   |  |  | 8.81 |  
|MBNA Master Consumer Loan Trust        |  |                    | 5,560,278  |              |           |                                              | 3  |            |  |  | (c      | ) |  |          | (c    | ) |      |  | (c   | )   |  |  | (c   | ) |  |  | (c   | )
|MBNA Triple A Master Trust             |  |                    | 2,000,000  |              |           |                                              | 2  |            |  |  | 18.29   |   |  |          | 9.50  |   |      |  | 8.79 |     |  |  | 8.83 |   |  |  | 8.78 |  
|Multiple Asset Note Trust              |  |                    | 1,000,000  |              |           |                                              | 2  |            |  |  | 19.43   |   |  |          | 9.94  |   |      |  | 9.49 |     |  |  | 9.51 |   |  |  | 9.48 |  
|UK Receivables Trust                   |  |                    | 2,508,196  |              |           |                                              | 4  |            |  |  | 19.16   |   |  |          | 12.11 |   |      |  | 7.05 |     |  |  | 7.40 |   |  |  | 6.06 |  
|UK Receivables Trust II                |  |                    | 9,174,519  |              |           |                                              | 14 |            |  |  | 18.19   |   |  |          | 11.95 |   |      |  | 6.24 |     |  |  | 6.43 |   |  |  | 6.13 |  
|Gloucester Credit Card Trust           |  |                    | 3,032,566  |              |           |                                              | 10 |            |  |  | 18.97   |   |  |          | 10.05 |   |      |  | 8.92 |     |  |  | 9.44 |   |  |  | 8.42 |  
|                                      



|    |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|--- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) |  | The Yield in Excess of Minimum Yield represents the trusts
    average annualized yield less its average minimum yield.                                                                                                                                                                                                                                                                                                                              
|(b) |  | MBNA Credit Card Master Note Trust issues a series of notes
    called the MBNAseries. Through the MBNAseries, MBNA Credit Card
    Master Note Trust issues specific classes of notes which
    contribute on a prorated basis to the calculation of the average
    yield in excess of minimum yield. This average yield in excess
    of minimum yield impacts the distribution of principal to
    investors of all classes within the MBNAseries.
|(c) |  | The MBNA Master Consumer Loan Trust yield in excess of minimum
    yield does not impact the distribution of principal to
    investors. Distribution to investors for transactions in this
    trust may begin earlier than the scheduled time if the credit
    enhancement amount falls below a predetermined contractual
    level. As a result, its yields are excluded from this Table.                                                         







---



##### 



TABLE 33: ESTIMATED CONTRACTUAL
OBLIGATIONS (a) (b) (dollars
in thousands)


|                                                                                                                  |                                         |                                                        |           |           |           |   |           |           |  |   |              |           |  |       |           |           |  |   |            |            | 
|----------------------------------------------------------------------------------------------------------------- | --------------------------------------- | ------------------------------------------------------ | --------- | --------- | --------- | - | --------- | --------- |  | - | ------------ | --------- |  | ----- | --------- | --------- |  | - | ---------- | ---------- | 
|                                                                                                                  |                                         | Estimated Contractual Obligations at December 31, 2004 |           |           |          
|                                                                                                                  |                                        
|                                                                                                                  |                                         | Within 1 Year                                          |           |           | 1-3 Years |   |           | 3-5 Years |  |   | Over 5 Years |           |  | Total |          
|                                                                                                                  |                                         |                                                        |          
|Long-term debt and bank notes (par) (c)                                                                           |                                         | $                                                      | 1,558,826 |           |           | $ | 2,371,222 |           |  | $ | 2,886,175    |           |  | $     | 4,395,451 |           |  | $ | 11,211,674 |           
|Minimum rental payments under noncancelable operating leases                                                      |                                         |                                                        | 30,457    |           |           |   | 21,998    |           |  |   | 5,615        |           |  |       | 1,680     |           |  |   | 59,750     |           
|Purchase obligations (d)                                                                                          |                                         |                                                        | 343,754   |           |           |   | 342,419   |           |  |   | 173,073      |           |  |       | 65,931    |           |  |   | 925,177    |           
|Other long-term liabilities reflected in the Corporations
    consolidated statements of financial condition (e) |                                         |                                                        | 164,350   |           |           |   | 171,734   |           |  |   | 54,601       |           |  |       | 222       |           |  |   | 390,907    |           
|                                                                                                                  |                                         |                                                        |           |           |           |   |           |           |  |   |              |           |  |       |          
|                                                                                                                  | Total estimated contractual obligations |                                                        | $         | 2,097,387 |           |   | $         | 2,907,373 |  |   | $            | 3,119,464 |  |       | $         | 4,463,284 |  |   | $          | 12,587,508 | 
|                                                                                                                  |                                         |                                                        |           |           |           |   |           |           |  |   |              |           |  |       |          
|                                                                                                                 



|    |  |                                                                                                                                                                                                                                   
|--- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) |  | Note 32: Fair Value of Financial Instruments
    Derivative Financial Instruments provides further detail on the
    Corporations derivative financial instruments. These
    amounts are not included in this Table.           
|(b) |  | Table 34 provides detail on the maturities of deposits. These
    amounts are not included in this Table.                                                                                                                         
|(c) |  | Excludes interest.                                                                                                                                                                                                                
|(d) |  | Includes the royalties to endorsing organizations payable in the
    future subject to certain conditions, commitments for Community
    Reinvestment Act investments that cannot be canceled, and other
    purchase obligations.
|(e) |  | Includes amounts accrued for Customer reward programs and other
    long-term contractual obligations.                                                                                                                            



STOCK REPURCHASES


FUNDING
  Off-Balance Sheet Asset Securitization








---



##### 



Credit Facilities
   Borrowed Funds


Deposits










---



##### 



TABLE 34: MATURITIES OF DEPOSITS
 (dollars in thousands)
 Direct
    
    Other
    
    TotalDecember 31, 2004
    
    Deposits
    
    Deposits (a)
    
    DepositsDomestic:One year or less
    
    $
    17,532,335
    
    
    $
    1,966,962
    
    
    $
    19,499,297Over one year through two years
    
    
    3,373,142
    
    
    
    1,030,174
    
    
    
    4,403,316Over two years through three years
    
    
    2,259,037
    
    
    
    779,225
    
    
    
    3,038,262Over three years through four years
    
    
    946,164
    
    
    
    120,933
    
    
    
    1,067,097Over four years through five years
    
    
    1,658,944
    
    
    
    
    
    
    
    1,658,944Over five years
    
    
    9,485
    
    
    
    
    
    
    
    9,485Total domestic deposits
    
    
    25,779,107
    
    
    
    3,897,294
    
    
    
    29,676,401Foreign:One year or less
    
    
    1,244,762
    
    
    
    160,407
    
    
    
    1,405,169Over one year through two years
    
    
    31,701
    
    
    
    
    
    
    
    31,701Over two years through three years
    
    
    58,288
    
    
    
    
    
    
    
    58,288Over three years through four years
    
    
    15,938
    
    
    
    
    
    
    
    15,938Over four years through five years
    
    
    52,007
    
    
    
    
    
    
    
    52,007Over five years
    
    
    
    
    
    
    
    
    
    
    Total foreign deposits
    
    
    1,402,696
    
    
    
    160,407
    
    
    
    1,563,103Total deposits
    
    $
    27,181,803
    
    
    $
    4,057,701
    
    
    $
    31,239,504  (a)
    
    At December 31, 2004, all other deposits were brokered
    deposits.  Investment Securities and Money Market Instruments





TABLE 35: TIME DEPOSITS OF $100,000 OR
MORE (a) (dollars
in thousands)


|                                       |          |                                             |   |           |           |  |      |      |       |   |   |           |           |  |  |      |       |   |   |           |           |  |  |      |       |  
|-------------------------------------- | -------- | ------------------------------------------- | - | --------- | --------- |  | ---- | ---- | ----- | - | - | --------- | --------- |  |  | ---- | ----- | - | - | --------- | --------- |  |  | ---- | ----- | -
|December 31,                           |          | 2004                                        |   |           |           |  | 2003 |      |       |   |   | 2002      |           |  | 
|                                       |         
|Three months or less:                  |          |                                             |   |           |           |  |      |      |       |   |   |           |           |  |  |      |       |   |   |           |           |  |  |     
|                                       | Domestic |                                             | $ | 646,269   |           |  |      | 12.2 | %     |   | $ | 438,832   |           |  |  | 10.2 | %     |   | $ | 548,380   |           |  |  | 13.8 | %    
|                                       | Foreign  |                                             |   | 864,218   |           |  |      | 16.4 |       |   |   | 852,249   |           |  |  | 19.9 |       |   |   | 611,135   |           |  |  | 15.3 |      
|                                       |          |                                             |   |           |           |  |      |      |       |   |   |           |           |  |  |      |       |  
|                                       |          | Total three months or less                  |   |           | 1,510,487 |  |      |      | 28.6  |   |   |           | 1,291,081 |  |  |      | 30.1  |   |   |           | 1,159,515 |  |  |      | 29.1  |  
|Over three months through six months:  |          |                                             |   |           |           |  |      |      |       |   |   |           |           |  |  |      |       |   |   |           |           |  |  |     
|                                       | Domestic |                                             |   | 562,613   |           |  |      | 10.7 |       |   |   | 360,223   |           |  |  | 8.4  |       |   |   | 479,662   |           |  |  | 12.0 |      
|                                       | Foreign  |                                             |   | 10,409    |           |  |      | .2   |       |   |   | 4,032     |           |  |  | .1   |       |   |   | 22,167    |           |  |  | .6   |      
|                                       |          |                                             |   |           |           |  |      |      |       |   |   |           |           |  |  |      |       |  
|                                       |          | Total over three months through six months  |   |           | 573,022   |  |      |      | 10.9  |   |   |           | 364,255   |  |  |      | 8.5   |   |   |           | 501,829   |  |  |      | 12.6  |  
|Over six months through twelve months: |          |                                             |   |           |           |  |      |      |       |   |   |           |           |  |  |      |       |   |   |           |           |  |  |     
|                                       | Domestic |                                             |   | 983,906   |           |  |      | 18.7 |       |   |   | 722,902   |           |  |  | 16.9 |       |   |   | 654,637   |           |  |  | 16.4 |      
|                                       | Foreign  |                                             |   | 144,332   |           |  |      | 2.8  |       |   |   | 5,626     |           |  |  | .1   |       |   |   | 14,509    |           |  |  | .4   |      
|                                       |          |                                             |   |           |           |  |      |      |       |   |   |           |           |  |  |      |       |  
|                                       |          | Total over six months through twelve months |   |           | 1,128,238 |  |      |      | 21.5  |   |   |           | 728,528   |  |  |      | 17.0  |   |   |           | 669,146   |  |  |      | 16.8  |  
|Over twelve months:                    |          |                                             |   |           |           |  |      |      |       |   |   |           |           |  |  |      |       |   |   |           |           |  |  |     
|                                       | Domestic |                                             |   | 1,989,589 |           |  |      | 37.8 |       |   |   | 1,900,128 |           |  |  | 44.4 |       |   |   | 1,654,141 |           |  |  | 41.5 |      
|                                       | Foreign  |                                             |   | 65,294    |           |  |      | 1.2  |       |   |   |          |           |  |  |     |       |   |   | 250       |           |  |  |     |      
|                                       |          |                                             |   |           |           |  |      |      |       |   |   |           |           |  |  |      |       |  
|                                       |          | Total over twelve months                    |   |           | 2,054,883 |  |      |      | 39.0  |   |   |           | 1,900,128 |  |  |      | 44.4  |   |   |           | 1,654,391 |  |  |      | 41.5  |  
|                                       |          |                                             |   |           |           |  |      |      |       |   |   |           |           |  |  |      |       |  
|                                       |          | Total                                       |   | $         | 5,266,630 |  |      |      | 100.0 | % |   | $         | 4,283,992 |  |  |      | 100.0 | % |   | $         | 3,984,881 |  |  |      | 100.0 | %
|                                       |          |                                             |   |           |           |  |      |      |       |   |   |           |           |  |  |      |       |  
|                                      



|    |  |                                                                                                                                                                                                                            
|--- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) |  | This Table excludes deposits obtained by a third-party
    intermediary in amounts of $100,000 or more which were
    subsequently distributed by intermediaries to individuals in
    denominations of less than $100,000.









---



##### 



TABLE 36: INVESTMENT SECURITIES
MATURITIES (dollars in
thousands)


|                   |                                                                  |                                                         |         |           |           |  |         |           |           |  |          |        |        |       |   |           |         |  |         |           |           |  |         |           |           |  |         |           |           | 
|------------------ | ---------------------------------------------------------------- | ------------------------------------------------------- | ------- | --------- | --------- |  | ------- | --------- | --------- |  | -------- | ------ | ------ | ----- | - | --------- | ------- |  | ------- | --------- | --------- |  | ------- | --------- | --------- |  | ------- | --------- | --------- | 
|                   |                                                                  | Estimated Maturities at December 31, 2004               |         |           |           |  |         |           |          
|                   |                                                                 
|                   |                                                                  | Within                                                  |         |           | 1-5       |  |         | 6-10      |           |  | Over     |        |        |       |   | Amortized |         |  | Market  |          
|                   |                                                                  | 1 Year                                                  |         |           | Years     |  |         | Years     |           |  | 10 Years |        |        | Total |   |           | Cost    |  |         | Value     |          
|                   |                                                                  |                                                         |        
|                   |                                                                  |                                                        
|Available-for-Sale |                                                                  |                                                         |         |           |           |  |         |           |           |  |          |        |        |       |   |           |         |  |         |           |           |  |         |           |           |  |         |          
|Domestic:          |                                                                  |                                                         |         |           |           |  |         |           |           |  |          |        |        |       |   |           |         |  |         |           |           |  |         |           |           |  |         |          
|                   | U.S. Treasury and other U.S. government agencies
    obligations |                                                         | $       | 1,218,242 |           |  | $       | 1,760,817 |           |  | $        |       |        |       | $ |          |         |  | $       | 2,979,059 |           |  | $       | 2,995,431 |           |  | $       | 2,979,059 |          
|                   | State and political subdivisions of the United States            |                                                         |         | 105,615   |           |  |         |          |           |  |          |       |        |       |   |          |         |  |         | 105,615   |           |  |         | 105,615   |           |  |         | 105,615   |          
|                   | Asset-backed and other securities                                |                                                         |         | 569,205   |           |  |         | 1,722,723 |           |  |          | 80,250 |        |       |   | 16        |         |  |         | 2,372,194 |           |  |         | 2,377,082 |           |  |         | 2,372,194 |          
|                   |                                                                  |                                                         |         |           |           |  |         |           |           |  |          |        |        |       |   |           |         |  |         |           |          
|                   |                                                                  | Total domestic investment securities available-for-sale |         |           | 1,893,062 |  |         |           | 3,483,540 |  |          |        | 80,250 |       |   |           | 16      |  |         |           | 5,456,868 |  |         |           | 5,478,128 |  |         |           | 5,456,868 | 
|Foreign            |                                                                  |                                                         | 489,130 |           |           |  | 116,522 |           |           |  |         |        |        |       |  |           |         |  | 605,652 |           |           |  | 605,124 |           |           |  | 605,652 |          
|                   |                                                                  |                                                         |         |           |           |  |         |           |           |  |          |        |        |       |   |           |         |  |         |           |          
|                   |                                                                  | Total investment securities available-for-sale          |         | $         | 2,382,192 |  |         | $         | 3,600,062 |  |          | $      | 80,250 |       |   | $         | 16      |  |         | $         | 6,062,520 |  |         | $         | 6,083,252 |  |         | $         | 6,062,520 | 
|                   |                                                                  |                                                         |         |           |           |  |         |           |           |  |          |        |        |       |   |           |         |  |         |           |          
|Held-to-Maturity   |                                                                  |                                                         |         |           |           |  |         |           |           |  |          |        |        |       |   |           |         |  |         |           |           |  |         |           |           |  |         |          
|Domestic:          |                                                                  |                                                         |         |           |           |  |         |           |           |  |          |        |        |       |   |           |         |  |         |           |           |  |         |           |           |  |         |          
|                   | U.S. Treasury and other U.S. government agencies
    obligations |                                                         | $       |          |           |  | $       |          |           |  | $        |       |        |       | $ | 275,755   |         |  | $       | 275,755   |           |  | $       | 275,755   |           |  | $       | 277,076   |          
|                   | State and political subdivisions of the United States            |                                                         |         |          |           |  |         |          |           |  |          | 649    |        |       |   | 6,006     |         |  |         | 6,655     |           |  |         | 6,655     |           |  |         | 6,820     |          
|                   | Asset-backed and other securities                                |                                                         |         |          |           |  |         |          |           |  |          |       |        |       |   | 15,664    |         |  |         | 15,664    |           |  |         | 15,664    |           |  |         | 15,176    |          
|                   |                                                                  |                                                         |         |           |           |  |         |           |           |  |          |        |        |       |   |           |         |  |         |           |          
|                   |                                                                  | Total domestic investment securities held-to-maturity   |         |           |          |  |         |           |          |  |          |        | 649    |       |   |           | 297,425 |  |         |           | 298,074   |  |         |           | 298,074   |  |         |           | 299,072   | 
|Foreign            |                                                                  |                                                         |        |           |           |  | 1,000   |           |           |  |         |        |        |       |  |           |         |  | 1,000   |           |           |  | 1,000   |           |           |  | 1,000   |          
|                   |                                                                  |                                                         |         |           |           |  |         |           |           |  |          |        |        |       |   |           |         |  |         |           |          
|                   |                                                                  | Total investment securities held-to-maturity            |         | $         |          |  |         | $         | 1,000     |  |          | $      | 649    |       |   | $         | 297,425 |  |         | $         | 299,074   |  |         | $         | 299,074   |  |         | $         | 300,072   | 
|                   |                                                                  |                                                         |         |           |           |  |         |           |           |  |          |        |        |       |   |           |         |  |         |           |          
|                   |                                                                  |                                                         |         |           |           |  |         |           |           |  |          |        |        |       |   |           |         |  |         |           |          



INTEREST RATE SENSITIVITY







TABLE 37: INVESTMENT SECURITIES
YIELDS (yields on a
fully taxable equivalent basis)


|                   |                                                                  |                                                         |      |      |           |  |      |            |      |  |          |      |      |       |   |      |      |  |      |      |      | 
|------------------ | ---------------------------------------------------------------- | ------------------------------------------------------- | ---- | ---- | --------- |  | ---- | ---------- | ---- |  | -------- | ---- | ---- | ----- | - | ---- | ---- |  | ---- | ---- | ---- | 
|                   |                                                                  | Yields at December 31, 2004                             |      |      |          
|                   |                                                                 
|                   |                                                                  | Over                                                    |      |      |          
|                   |                                                                  | Within 1 Year                                           |      |      | 1-5 Years |  |      | 6-10 Years |      |  | 10 Years |      |      | Total |  
|                   |                                                                  |                                                         |     
|                   |                                                                  |                                                        
|Available-for-Sale |                                                                  |                                                         |      |      |           |  |      |            |      |  |          |      |      |       |   |      |      |  |      |     
|Domestic:          |                                                                  |                                                         |      |      |           |  |      |            |      |  |          |      |      |       |   |      |      |  |      |     
|                   | U.S. Treasury and other U.S. government agencies
    obligations |                                                         |      | 1.69 | %         |  |      | 2.82       | %    |  |          |     | %    |       |   |     | %    |  |      | 2.36 | %   
|                   | State and political subdivisions of the United States            |                                                         |      | 3.09 |           |  |      |           |      |  |          |     |      |       |   |     |      |  |      | 3.09 |     
|                   | Asset-backed and other securities                                |                                                         |      | 2.16 |           |  |      | 2.65       |      |  |          | 2.43 |      |       |   | 2.63 |      |  |      | 2.52 |     
|                   |                                                                  | Total domestic investment securities available-for-sale |      |      | 1.91      |  |      |            | 2.74 |  |          |      | 2.43 |       |   |      | 2.63 |  |      |      | 2.44 | 
|Foreign            |                                                                  |                                                         | 2.37 |      |           |  | 2.84 |            |      |  |         |      |      |       |  |      |      |  | 2.46 |     
|                   |                                                                  | Total investment securities available-for-sale          |      |      | 2.00      |  |      |            | 2.74 |  |          |      | 2.43 |       |   |      | 2.63 |  |      |      | 2.45 | 
|Held-to-Maturity   |                                                                  |                                                         |      |      |           |  |      |            |      |  |          |      |      |       |   |      |      |  |      |     
|Domestic:          |                                                                  |                                                         |      |      |           |  |      |            |      |  |          |      |      |       |   |      |      |  |      |     
|                   | U.S. Treasury and other U.S. government agencies
    obligations |                                                         |      |     |           |  |      |           |      |  |          |     |      |       |   | 5.07 |      |  |      | 5.07 |     
|                   | State and political subdivisions of the United States            |                                                         |      |     |           |  |      |           |      |  |          | 6.94 |      |       |   | 7.53 |      |  |      | 7.47 |     
|                   | Asset-backed and other securities                                |                                                         |      |     |           |  |      |           |      |  |          |     |      |       |   | 4.55 |      |  |      | 4.55 |     
|                   |                                                                  | Total domestic investment securities held-to-maturity   |      |      |          |  |      |            |     |  |          |      | 6.94 |       |   |      | 5.09 |  |      |      | 5.10 | 
|Foreign            |                                                                  |                                                         |     |      |           |  | 5.30 |            |      |  |         |      |      |       |  |      |      |  | 5.30 |     
|                   |                                                                  | Total investment securities held-to-maturity            |      |      |          |  |      |            | 5.30 |  |          |      | 6.94 |       |   |      | 5.09 |  |      |      | 5.10 | 
|                  







---



##### 











TABLE 38: INTEREST RATE SENSITIVITY
SCHEDULE (dollars in
thousands)


|                                                                  |                                    |                                       |                                                     |           |            |            |            |               |            |            |            |   |           |           |           |           |            |            | 
|----------------------------------------------------------------- | ---------------------------------- | ------------------------------------- | --------------------------------------------------- | --------- | ---------- | ---------- | ---------- | ------------- | ---------- | ---------- | ---------- | - | --------- | --------- | --------- | --------- | ---------- | ---------- | 
|December 31, 2004                                                 |                                    |                                       | Subject to Repricing                                |           |            |           
|                                                                  |                                   
|                                                                  |                                    | Within 1 Year                         |                                                     |           | 1-5 Years  |            |            | After 5 Years |            |            | Total      |  
|                                                                  |                                    |                                       |                                                    
|Interest-Earning Assets                                           |                                    |                                       |                                                     |           |            |            |            |               |            |            |            |   |           |           |           |          
|Interest-earning time deposits in other banks:                    |                                    |                                       |                                                     |           |            |            |            |               |            |            |            |   |           |           |           |          
|                                                                  | Domestic                           |                                       | $                                                   | 132,796   |            |            | $          |              |            |            | $          |  |           |           | $         | 132,796   |           
|                                                                  | Foreign                            |                                       |                                                     | 2,635,035 |            |            |            |              |            |            |            |  |           |           |           | 2,635,035 |           
|                                                                  |                                    |                                       |                                                     |           |            |            |            |               |            |            |            |  
|                                                                  |                                    |                                       | Total interest-earning time deposits in other banks |           |            | 2,767,831  |            |               |            |           |            |   |           |          |           |           |            | 2,767,831  | 
|Federal funds sold                                                |                                    |                                       | 1,605,000                                           |           |            |            |           |               |            |            |           |   |           |           | 1,605,000 |          
|Investment securities (a):                                        |                                    |                                       |                                                     |           |            |            |            |               |            |            |            |   |           |           |           |          
|                                                                  | Available-for-sale:                |                                       |                                                     |           |            |            |            |               |            |            |            |   |           |           |           |           |           
|                                                                  |                                    | Domestic                              |                                                     |           | 3,024,720  |            |            |               | 2,432,148  |            |            |   |          |           |           |           | 5,456,868  |           
|                                                                  |                                    | Foreign                               |                                                     |           | 543,154    |            |            |               | 62,498     |            |            |   |          |           |           |           | 605,652    |           
|                                                                  |                                    |                                       |                                                     |           |            |            |            |               |            |            |            |  
|                                                                  |                                    |                                       | Total available-for-sale                            |           |            | 3,567,874  |            |               |            | 2,494,646  |            |   |           |          |           |           |            | 6,062,520  | 
|                                                                  | Held-to-maturity:                  |                                       |                                                     |           |            |            |            |               |            |            |            |   |           |           |           |           |           
|                                                                  |                                    | Domestic                              |                                                     |           |           |            |            |               |           |            |            |   | 298,074   |           |           |           | 298,074    |           
|                                                                  |                                    | Foreign                               |                                                     |           |           |            |            |               | 1,000      |            |            |   |          |           |           |           | 1,000      |           
|                                                                  |                                    |                                       |                                                     |           |            |            |            |               |            |            |            |  
|                                                                  |                                    |                                       | Total held-to-maturity                              |           |            |           |            |               |            | 1,000      |            |   |           | 298,074   |           |           |            | 299,074    | 
|Other interest-earning assets                                     |                                    |                                       | 3,958,799                                           |           |            |            |           |               |            |            | 71,447     |   |           |           | 4,030,246 |          
|Loans held for securitization:                                    |                                    |                                       |                                                     |           |            |            |            |               |            |            |            |   |           |           |           |          
|                                                                  | Domestic:                          |                                       |                                                     |           |            |            |            |               |            |            |            |   |           |           |           |           |           
|                                                                  |                                    | Credit card                           |                                                     |           | 7,023,182  |            |            |               |           |            |            |   |          |           |           |           | 7,023,182  |           
|                                                                  |                                    | Other consumer                        |                                                     |           | 15,960     |            |            |               |           |            |            |   |          |           |           |           | 15,960     |           
|                                                                  |                                    | Commercial                            |                                                     |           | 667        |            |            |               |           |            |            |   |          |           |           |           | 667        |           
|                                                                  |                                    |                                       |                                                     |           |            |            |            |               |            |            |            |  
|                                                                  |                                    |                                       | Total domestic loans held for securitization        |           |            | 7,039,809  |            |               |            |           |            |   |           |          |           |           |            | 7,039,809  | 
|                                                                  | Foreign:                           |                                       |                                                     |           |            |            |            |               |            |            |            |   |           |           |           |           |           
|                                                                  |                                    | Credit card                           |                                                     |           | 1,199,678  |            |            |               |           |            |            |   |          |           |           |           | 1,199,678  |           
|                                                                  |                                    | Other consumer                        |                                                     |           |           |            |            |               |           |            |            |   |          |           |           |           |           |           
|                                                                  |                                    | Commercial                            |                                                     |           |           |            |            |               |           |            |            |   |          |           |           |           |           |           
|                                                                  |                                    |                                       |                                                     |           |            |            |            |               |            |            |            |  
|                                                                  |                                    |                                       | Total foreign loans held for securitization         |           |            | 1,199,678  |            |               |            |           |            |   |           |          |           |           |            | 1,199,678  | 
|                                                                  |                                    |                                       |                                                     |           |            |            |            |               |            |            |            |  
|                                                                  |                                    |                                       | Total loans held for securitization                 |           |            | 8,239,487  |            |               |            |           |            |   |           |          |           |           |            | 8,239,487  | 
|Loan portfolio:                                                   |                                    |                                       |                                                     |           |            |            |            |               |            |            |            |   |           |           |           |          
|                                                                  | Domestic:                          |                                       |                                                     |           |            |            |            |               |            |            |            |   |           |           |           |           |           
|                                                                  |                                    | Credit card                           |                                                     |           | 6,216,029  |            |            |               | 679,158    |            |            |   |          |           |           |           | 6,895,187  |           
|                                                                  |                                    | Other consumer                        |                                                     |           | 4,862,281  |            |            |               | 695,354    |            |            |   | 265,312   |           |           |           | 5,822,947  |           
|                                                                  |                                    | Commercial                            |                                                     |           | 1,720,164  |            |            |               | 360,034    |            |            |   | 655,709   |           |           |           | 2,735,907  |           
|                                                                  |                                    |                                       |                                                     |           |            |            |            |               |            |            |            |  
|                                                                  |                                    |                                       | Total domestic loan portfolio                       |           |            | 12,798,474 |            |               |            | 1,734,546  |            |   |           | 921,021   |           |           |            | 15,454,041 | 
|                                                                  | Foreign:                           |                                       |                                                     |           |            |            |            |               |            |            |            |   |           |           |           |           |           
|                                                                  |                                    | Credit card                           |                                                     |           | 3,957,205  |            |            |               | 1,615,808  |            |            |   |          |           |           |           | 5,573,013  |           
|                                                                  |                                    | Other consumer                        |                                                     |           | 1,509,242  |            |            |               | 1,737,641  |            |            |   | 19,235    |           |           |           | 3,266,118  |           
|                                                                  |                                    | Commercial                            |                                                     |           | 1,202,396  |            |            |               | 23,795     |            |            |   |          |           |           |           | 1,226,191  |           
|                                                                  |                                    |                                       |                                                     |           |            |            |            |               |            |            |            |  
|                                                                  |                                    |                                       | Total foreign loan portfolio                        |           |            | 6,668,843  |            |               |            | 3,377,244  |            |   |           | 19,235    |           |           |            | 10,065,322 | 
|                                                                  |                                    |                                       |                                                     |           |            |            |            |               |            |            |            |  
|                                                                  |                                    |                                       | Total loan portfolio                                |           |            | 19,467,317 |            |               |            | 5,111,790  |            |   |           | 940,256   |           |           |            | 25,519,363 | 
|                                                                  |                                    |                                       |                                                     |           |            |            |            |               |            |            |            |  
|                                                                  |                                    |                                       | Total interest-earning assets                       |           |            | 39,606,308 |            |               |            | 7,607,436  |            |   |           | 1,309,777 |           |           |            | 48,523,521 | 
|Interest-Bearing Liabilities                                      |                                    |                                       |                                                     |           |            |            |            |               |            |            |            |   |           |           |           |          
|Interest-bearing deposits:                                        |                                    |                                       |                                                     |           |            |            |            |               |            |            |            |   |           |           |           |          
|                                                                  | Domestic:                          |                                       |                                                     |           |            |            |            |               |            |            |            |   |           |           |           |           |           
|                                                                  |                                    | Time deposits                         |                                                     |           | 10,355,452 |            |            |               | 10,167,619 |            |            |   | 9,485     |           |           |           | 20,532,556 |           
|                                                                  |                                    | Money market deposit accounts         |                                                     |           | 6,582,997  |            |            |               |           |            |            |   |          |           |           |           | 6,582,997  |           
|                                                                  |                                    | Interest-bearing transaction accounts |                                                     |           | 49,781     |            |            |               |           |            |            |   |          |           |           |           | 49,781     |           
|                                                                  |                                    | Savings accounts                      |                                                     |           | 77,305     |            |            |               |           |            |            |   |          |           |           |           | 77,305     |           
|                                                                  |                                    |                                       |                                                     |           |            |            |            |               |            |            |            |  
|                                                                  |                                    |                                       | Total domestic interest-bearing deposits            |           |            | 17,065,535 |            |               |            | 10,167,619 |            |   |           | 9,485     |           |           |            | 27,242,639 | 
|                                                                  | Foreign:                           |                                       |                                                     |           |            |            |            |               |            |            |            |   |           |           |           |           |           
|                                                                  |                                    | Time deposits                         |                                                     |           | 1,098,868  |            |            |               | 157,934    |            |            |   |          |           |           |           | 1,256,802  |           
|                                                                  |                                    |                                       |                                                     |           |            |            |            |               |            |            |            |  
|                                                                  |                                    |                                       | Total interest-bearing deposits                     |           |            | 18,164,403 |            |               |            | 10,325,553 |            |   |           | 9,485     |           |           |            | 28,499,441 | 
|Borrowed funds:                                                   |                                    |                                       |                                                     |           |            |            |            |               |            |            |            |   |           |           |           |          
|                                                                  | Short-term borrowings:             |                                       |                                                     |           |            |            |            |               |            |            |            |   |           |           |           |           |           
|                                                                  |                                    | Domestic                              |                                                     |           | 901,455    |            |            |               |           |            |            |   |          |           |           |           | 901,455    |           
|                                                                  |                                    | Foreign                               |                                                     |           | 1,202,959  |            |            |               |           |            |            |   |          |           |           |           | 1,202,959  |           
|                                                                  |                                    |                                       |                                                     |           |            |            |            |               |            |            |            |  
|                                                                  |                                    |                                       | Total short-term borrowings                         |           |            | 2,104,414  |            |               |            |           |            |   |           |          |           |           |            | 2,104,414  | 
|                                                                  | Long-term debt and bank notes (a): |                                       |                                                     |           |            |            |            |               |            |            |            |   |           |           |           |           |           
|                                                                  |                                    | Domestic                              |                                                     |           | 1,205,054  |            |            |               | 3,771,123  |            |            |   | 2,741,721 |           |           |           | 7,717,898  |           
|                                                                  |                                    | Foreign                               |                                                     |           | 1,272,107  |            |            |               | 1,943,800  |            |            |   | 489,095   |           |           |           | 3,705,002  |           
|                                                                  |                                    |                                       |                                                     |           |            |            |            |               |            |            |            |  
|                                                                  |                                    |                                       | Total long-term debt and bank notes                 |           |            | 2,477,161  |            |               |            | 5,714,923  |            |   |           | 3,230,816 |           |           |            | 11,422,900 | 
|                                                                  |                                    |                                       |                                                     |           |            |            |            |               |            |            |            |  
|                                                                  |                                    |                                       | Total borrowed funds                                |           |            | 4,581,575  |            |               |            | 5,714,923  |            |   |           | 3,230,816 |           |           |            | 13,527,314 | 
|                                                                  |                                    |                                       |                                                     |           |            |            |            |               |            |            |            |  
|                                                                  |                                    |                                       | Total interest-bearing liabilities                  |           |            | 22,745,978 |            |               |            | 16,040,476 |            |   |           | 3,240,301 |           |           |            | 42,026,755 | 
|                                                                  |                                    |                                       |                                                     |           |            |            |            |               |            |            |            |  
|Gap before managed adjustments                                    |                                    |                                       | 16,860,330                                          |           |            |            | (8,433,040 | )             |            |            | (1,930,524 | ) |           |           | 6,496,766 |          
|Managed adjustments (b)                                           |                                    |                                       | (14,030,474                                         | )         |            |            | 13,848,035 |               |            |            | 2,332,864  |   |           |           | 2,150,425 |          
|                                                                  |                                    |                                       |                                                     |           |            |            |            |               |            |            |            |  
|Gap after managed adjustments                                     |                                    | $                                     | 2,829,856                                           |           |            | $          | 5,414,995  |               |            | $          | 402,340    |   |           | $         | 8,647,191 |          
|                                                                  |                                    |                                       |                                                     |           |            |            |            |               |            |            |            |  
|Cumulative gap after managed adjustments                          |                                    | $                                     | 2,829,856                                           |           |            | $          | 8,244,851  |               |            | $          | 8,647,191  |   |           |           |           |          
|                                                                  |                                    |                                       |                                                     |           |            |            |            |               |            |            |            |  
|Cumulative gap after managed adjustments as a % of managed assets |                                    |                                       | 1.91                                                | %         |            |            | 5.57       | %             |            |            | 5.84       | % |           |           |           |          
|                                                                 



|    |  |                                                                                                                          
|--- |  | -------------------------------------------------------------------------------------------------------------------------
|(a) |  | Presented using estimated maturities.                                                                                    
|(b) |  | Managed adjustments reflect the impact interest rates have on
    securitized loans and derivative financial instruments.









---



##### 



The Wall Street Journal


FOREIGN CURRENCY EXCHANGE RATE SENSITIVITY
  CROSS-BORDER OUTSTANDINGS
  REGULATORY AND OTHER MATTERS
 MASTERCARD AND VISA LITIGATION AND COMPETITION










---



##### 



INTERCHANGE IN THE U.K.
     BASEL COMMITTEE


OFFICE OF FAIR TRADE INVESTIGATION OF DEFAULT CHARGES IN THE
U.K.










---



##### 









TABLE 39: MANAGED RECONCILIATION OF THE FIVE-YEAR STATISTICAL
SUMMARY


RECONCILIATION OF INCOME STATEMENT DATA FOR THE PERIOD TO
MANAGED NET INTEREST INCOME, MANAGED PROVISION FOR POSSIBLE
CREDIT LOSSES, AND MANAGED OTHER OPERATING
INCOME (dollars in thousands)


|                                             |  |      |            |   |      |   |            |      |  |   |            |   |  |      |            |   |  |   |            |  
|-------------------------------------------- |  | ---- | ---------- | - | ---- | - | ---------- | ---- |  | - | ---------- | - |  | ---- | ---------- | - |  | - | ---------- | -
|Year Ended December 31,                      |  | 2004 |            |   | 2003 |   |            | 2002 |  |   | 2001       |   |  | 2000 |           
|                                             | 
|Net Interest Income                          |  |      |            |   |      |   |            |      |  |   |            |   |  |      |            |   |  |   |            |  
|Net interest income                          |  | $    | 2,536,801  |   |      | $ | 2,350,373  |      |  | $ | 2,074,575  |   |  | $    | 1,657,340  |   |  | $ | 1,395,015  |  
|Securitization adjustments                   |  |      | 7,884,471  |   |      |   | 7,854,265  |      |  |   | 7,044,102  |   |  |      | 6,546,802  |   |  |   | 4,442,094  |  
|                                             |  |      |            |   |      |   |            |      |  |   |            |   |  |      |           
|Managed net interest income                  |  | $    | 10,421,272 |   |      | $ | 10,204,638 |      |  | $ | 9,118,677  |   |  | $    | 8,204,142  |   |  | $ | 5,837,109  |  
|                                             |  |      |            |   |      |   |            |      |  |   |            |   |  |      |           
|Provision for Possible Credit Losses         |  |      |            |   |      |   |            |      |  |   |            |   |  |      |            |   |  |   |            |  
|Provision for possible credit losses         |  | $    | 1,146,855  |   |      | $ | 1,392,701  |      |  | $ | 1,340,157  |   |  | $    | 1,140,615  |   |  | $ | 547,309    |  
|Securitization adjustments                   |  |      | 4,276,024  |   |      |   | 4,375,469  |      |  |   | 3,835,383  |   |  |      | 3,452,014  |   |  |   | 2,800,980  |  
|                                             |  |      |            |   |      |   |            |      |  |   |            |   |  |      |           
|Managed provision for possible credit losses |  | $    | 5,422,879  |   |      | $ | 5,768,170  |      |  | $ | 5,175,540  |   |  | $    | 4,592,629  |   |  | $ | 3,348,289  |  
|                                             |  |      |            |   |      |   |            |      |  |   |            |   |  |      |           
|Other Operating Income                       |  |      |            |   |      |   |            |      |  |   |            |   |  |      |            |   |  |   |            |  
|Other operating income                       |  | $    | 8,258,386  |   |      | $ | 7,825,480  |      |  | $ | 6,752,923  |   |  | $    | 6,673,316  |   |  | $ | 4,920,403  |  
|Securitization adjustments                   |  |      | (3,608,447 | ) |      |   | (3,478,796 | )    |  |   | (3,208,719 | ) |  |      | (3,094,788 | ) |  |   | (1,641,114 | )
|                                             |  |      |            |   |      |   |            |      |  |   |            |   |  |      |           
|Managed other operating income               |  | $    | 4,649,939  |   |      | $ | 4,346,684  |      |  | $ | 3,544,204  |   |  | $    | 3,578,528  |   |  | $ | 3,279,289  |  
|                                             |  |      |            |   |      |   |            |      |  |   |            |   |  |      |           
|                                            

RECONCILIATION OF THE LOAN RECEIVABLES NET CREDIT LOSS RATIO
TO THE MANAGED


NET CREDIT LOSS
RATIO (dollars in
thousands)


|                        |  |            |           |  |             |      |             |           |      |         |            |   |            |             |           |  |           |         |             |            |            |  |             |   |  |           |           |  |  |   |             |  |  |  |      |  
|----------------------- |  | ---------- | --------- |  | ----------- | ---- | ----------- | --------- | ---- | ------- | ---------- | - | ---------- | ----------- | --------- |  | --------- | ------- | ----------- | ---------- | ---------- |  | ----------- | - |  | --------- | --------- |  |  | - | ----------- |  |  |  | ---- | -
|Year Ended              |  |            |           |  |             |     
|December 31,            |  |            | 2004      |  |             | 2003 |             |           | 2002 |        
|                        | 
|                        |  | Average    |           |  | Net Credit  |      |             |           |      | Average |            |   | Net Credit |             |           |  |           | Average |             |            | Net Credit | 
|                        |  | Net Credit |           |  | Loans       |      |             | Loss      |      |         | Net Credit |   |            | Loans       |           |  | Loss      |         |             | Net Credit |            |  | Loans       |   |  | Loss      |          
|                        |  | Losses (a) |           |  | Outstanding |      |             | Ratio (a) |      |         | Losses (a) |   |            | Outstanding |           |  | Ratio (a) |         |             | Losses (a) |            |  | Outstanding |   |  | Ratio (a) |          
|                        |  |            |          
|Loan receivables (b)    |  | $          | 1,324,176 |  |             | $    | 31,055,787  |           |      |         | 4.26       | % |            | $           | 1,363,696 |  |           | $       | 28,183,818  |            |            |  | 4.84        | % |  | $         | 1,156,212 |  |  | $ | 25,315,200  |  |  |  | 4.57 | %
|Securitized loans       |  |            | 4,276,024 |  |             |      | 87,040,251  |           |      |         | 4.91       |   |            |             | 4,375,469 |  |           |         | 81,691,156  |            |            |  | 5.36        |   |  |           | 3,835,383 |  |  |   | 74,718,731  |  |  |  | 5.13 |  
|                        |  |            |           |  |             |      |             |           |      |         |            |   |            |             |           |  |           |         |             |            |            |  |             |   |  |           |          
|Managed loans           |  | $          | 5,600,200 |  |             | $    | 118,096,038 |           |      |         | 4.74       |   |            | $           | 5,739,165 |  |           | $       | 109,874,974 |            |            |  | 5.22        |   |  | $         | 4,991,595 |  |  | $ | 100,033,931 |  |  |  | 4.99 |  
|                        |  |            |           |  |             |      |             |           |      |         |            |   |            |             |           |  |           |         |             |            |            |  |             |   |  |           |          
|                       
|Year Ended December 31, |  | 2001       |           |  | 2000        |     
|                        | 
|                        |  | Average    |           |  | Net Credit  |      |             |           |      | Average |            |   | Net Credit |            
|                        |  | Net Credit |           |  | Loans       |      |             | Loss      |      |         | Net Credit |   |            | Loans       |           |  | Loss      |        
|                        |  | Losses (a) |           |  | Outstanding |      |             | Ratio (a) |      |         | Losses (a) |   |            | Outstanding |           |  | Ratio (a) |        
|                        |  |            |          
|Loan receivables (b)    |  | $          | 855,014   |  |             | $    | 20,339,388  |           |      |         | 4.20       | % |            | $           | 599,642   |  |           | $       | 17,718,148  |            |            |  | 3.38        | %
|Securitized loans       |  |            | 3,452,014 |  |             |      | 70,560,600  |           |      |         | 4.89       |   |            |             | 2,800,980 |  |           |         | 59,726,838  |            |            |  | 4.69        |  
|                        |  |            |           |  |             |      |             |           |      |         |            |   |            |             |           |  |           |        
|Managed loans           |  | $          | 4,307,028 |  |             | $    | 90,899,988  |           |      |         | 4.74       |   |            | $           | 3,400,622 |  |           | $       | 77,444,986  |            |            |  | 4.39        |  
|                        |  |            |           |  |             |      |             |           |      |         |            |   |            |             |           |  |           |        
|                       

RECONCILIATION OF THE LOAN RECEIVABLES DELINQUENCY RATIO TO
THE MANAGED DELINQUENCY
RATIO (dollars in
thousands)


|                     |  |              |           |  |              |   |             |           |  |            |              |   |  |              |             |  |           |            |             |              |  |  |              |   |  |           |           |  |  |   |             |  |  |  |      |  
|-------------------- |  | ------------ | --------- |  | ------------ | - | ----------- | --------- |  | ---------- | ------------ | - |  | ------------ | ----------- |  | --------- | ---------- | ----------- | ------------ |  |  | ------------ | - |  | --------- | --------- |  |  | - | ----------- |  |  |  | ---- | -
|December 31,         |  | 2004         |           |  | 2003         |   |             | 2002      | 
|                     | 
|                     |  | Delinquent   |           |  |              |   | Delinquency |           |  | Delinquent |              |   |  |              | Delinquency |  |           | Delinquent |             |              |  |  | Delinquency  |  
|                     |  | Balances (c) |           |  | Ending Loans |   |             | Ratio (c) |  |            | Balances (c) |   |  | Ending Loans |             |  | Ratio (c) |            |             | Balances (c) |  |  | Ending Loans |   |  | Ratio (c) |          
|                     |  |              |          
|Loan receivables (b) |  | $            | 1,111,441 |  |              | $ | 33,758,850  |           |  |            | 3.29         | % |  | $            | 1,289,799   |  |           | $          | 33,624,077  |              |  |  | 3.84         | % |  | $         | 1,251,603 |  |  | $ | 28,726,508  |  |  |  | 4.36 | %
|Securitized loans    |  |              | 3,913,656 |  |              |   | 87,859,325  |           |  |            | 4.45         |   |  |              | 3,913,851   |  |           |            | 84,869,483  |              |  |  | 4.61         |   |  |           | 3,977,908 |  |  |   | 78,531,334  |  |  |  | 5.07 |  
|                     |  |              |           |  |              |   |             |           |  |            |              |   |  |              |             |  |           |            |             |              |  |  |              |   |  |           |          
|Managed loans        |  | $            | 5,025,097 |  |              | $ | 121,618,175 |           |  |            | 4.13         |   |  | $            | 5,203,650   |  |           | $          | 118,493,560 |              |  |  | 4.39         |   |  | $         | 5,229,511 |  |  | $ | 107,257,842 |  |  |  | 4.88 |  
|                     |  |              |           |  |              |   |             |           |  |            |              |   |  |              |             |  |           |            |             |              |  |  |              |   |  |           |          
|                    
|December 31,         |  | 2001         |           |  | 2000         |  
|                     | 
|                     |  | Delinquent   |           |  |              |   | Delinquency |           |  | Delinquent |              |   |  |              | Delinquency | 
|                     |  | Balances (c) |           |  | Ending Loans |   |             | Ratio (c) |  |            | Balances (c) |   |  | Ending Loans |             |  | Ratio (c) |           
|                     |  |              |          
|Loan receivables (b) |  | $            | 1,150,901 |  |              | $ | 24,633,564  |           |  |            | 4.67         | % |  | $            | 803,680     |  |           | $          | 19,954,837  |              |  |  | 4.03         | %
|Securitized loans    |  |              | 3,811,560 |  |              |   | 72,862,487  |           |  |            | 5.23         |   |  |              | 3,182,858   |  |           |            | 68,835,884  |              |  |  | 4.62         |  
|                     |  |              |           |  |              |   |             |           |  |            |              |   |  |              |             |  |           |           
|Managed loans        |  | $            | 4,962,461 |  |              | $ | 97,496,051  |           |  |            | 5.09         |   |  | $            | 3,986,538   |  |           | $          | 88,790,721  |              |  |  | 4.49         |  
|                     |  |              |           |  |              |   |             |           |  |            |              |   |  |              |             |  |           |           
|                    







---



##### 



TABLE 39: MANAGED RECONCILIATION OF THE FIVE-YEAR STATISTICAL
SUMMARY  Continued


RECONCILIATION OF THE NET INTEREST MARGIN RATIO TO THE
MANAGED NET INTEREST MARGIN RATIO


(dollars in thousands)


|                                                   |       |         |             |             |              |      |          |            |      |         |         |      |   |              |             |             |        |         |   |            |  |  |              |       |   |        |             |             |  |  |   |           |  |  |  |      |  
|-------------------------------------------------- | ----- | ------- | ----------- | ----------- | ------------ | ---- | -------- | ---------- | ---- | ------- | ------- | ---- | - | ------------ | ----------- | ----------- | ------ | ------- | - | ---------- |  |  | ------------ | ----- | - | ------ | ----------- | ----------- |  |  | - | --------- |  |  |  | ---- | -
|Year Ended December 31,                            |       |         | 2004        |             |              | 2003 |          |            | 2002 |        
|                                                   |      
|                                                   |       | Net     |             |             |              |      | Net      |            |      |         |         | Net  |  
|                                                   |       | Average |             |             |              |      | Interest |            |      | Average |         |      |   |              | Interest    |             |        | Average |   |            |  |  | Interest     |      
|                                                   |       | Earning |             |             | Net Interest |      |          | Margin     |      |         | Earning |      |   | Net Interest |             |             | Margin |         |   | Earning    |  |  | Net Interest |       |   | Margin |            
|                                                   |       | Assets  |             |             | Income       |      |          | Ratio      |      |         | Assets  |      |   | Income       |             |             | Ratio  |         |   | Assets     |  |  | Income       |       |   | Ratio  |            
|                                                   |       |         |            
|Net Interest Margin (d)                            |       |         |             |             |              |      |          |            |      |         |         |      |   |              |             |             |        |         |   |            |  |  |              |       |   |        |             |             |  |  |   |           |  |  |  |     
|Investment securities and money market instruments |       | $       | 12,446,434  |             |              |      |          |            |      |         |         |      |   | $            | 11,693,550  |             |        |         |   |            |  |  |              |       |   | $      | 8,257,838   |             |  |  |   |           |  |  |  |     
|Other interest-earning assets                      |       |         | 4,120,645   |             |              |      |          |            |      |         |         |      |   |              | 3,904,013   |             |        |         |   |            |  |  |              |       |   |        | 3,869,893   |             |  |  |   |           |  |  |  |     
|Loan receivables (b)                               |       |         | 31,055,787  |             |              |      |          |            |      |         |         |      |   |              | 28,183,818  |             |        |         |   |            |  |  |              |       |   |        | 25,315,200  |             |  |  |   |           |  |  |  |     
|                                                   |       |         |             |             |              |      |          |            |      |         |         |      |   |              |             |             |        |         |   |            |  |  |              |       |   |        |            
|                                                   | Total |         | $           | 47,622,866  |              |      | $        | 2,537,790  |      |         |         | 5.33 | % |              | $           | 43,781,381  |        |         | $ | 2,351,132  |  |  |              | 5.37  | % |        | $           | 37,442,931  |  |  | $ | 2,075,645 |  |  |  | 5.54 | %
|                                                   |       |         |             |             |              |      |          |            |      |         |         |      |   |              |             |             |        |         |   |            |  |  |              |       |   |        |            
|Securitization Adjustments                         |       |         |             |             |              |      |          |            |      |         |         |      |   |              |             |             |        |         |   |            |  |  |              |       |   |        |             |             |  |  |   |           |  |  |  |     
|Investment securities and money market instruments |       | $       |            |             |              |      |          |            |      |         |         |      |   | $            |            |             |        |         |   |            |  |  |              |       |   | $      |            |             |  |  |   |           |  |  |  |     
|Other interest-earning assets                      |       |         | (4,049,751  | )           |              |      |          |            |      |         |         |      |   |              | (3,835,216  | )           |        |         |   |            |  |  |              |       |   |        | (3,808,179  | )           |  |  |   |           |  |  |  |     
|Securitized loans                                  |       |         | 87,040,251  |             |              |      |          |            |      |         |         |      |   |              | 81,691,156  |             |        |         |   |            |  |  |              |       |   |        | 74,718,731  |             |  |  |   |           |  |  |  |     
|                                                   |       |         |             |             |              |      |          |            |      |         |         |      |   |              |             |             |        |         |   |            |  |  |              |       |   |        |            
|                                                   | Total |         | $           | 82,990,500  |              |      |          | 7,884,471  |      |         |         | 9.50 |   |              | $           | 77,855,940  |        |         |   | 7,854,265  |  |  |              | 10.09 |   |        | $           | 70,910,552  |  |  |   | 7,044,102 |  |  |  | 9.93 |  
|                                                   |       |         |             |             |              |      |          |            |      |         |         |      |   |              |             |             |        |         |   |            |  |  |              |       |   |        |            
|Managed Net Interest Margin (d)                    |       |         |             |             |              |      |          |            |      |         |         |      |   |              |             |             |        |         |   |            |  |  |              |       |   |        |             |             |  |  |   |           |  |  |  |     
|Investment securities and money market instruments |       | $       | 12,446,434  |             |              |      |          |            |      |         |         |      |   | $            | 11,693,550  |             |        |         |   |            |  |  |              |       |   | $      | 8,257,838   |             |  |  |   |           |  |  |  |     
|Other interest-earning assets                      |       |         | 70,894      |             |              |      |          |            |      |         |         |      |   |              | 68,797      |             |        |         |   |            |  |  |              |       |   |        | 61,714      |             |  |  |   |           |  |  |  |     
|Managed loans                                      |       |         | 118,096,038 |             |              |      |          |            |      |         |         |      |   |              | 109,874,974 |             |        |         |   |            |  |  |              |       |   |        | 100,033,931 |             |  |  |   |           |  |  |  |     
|                                                   |       |         |             |             |              |      |          |            |      |         |         |      |   |              |             |             |        |         |   |            |  |  |              |       |   |        |            
|                                                   | Total |         | $           | 130,613,366 |              |      |          | 10,422,261 |      |         |         | 7.98 |   |              | $           | 121,637,321 |        |         |   | 10,205,397 |  |  |              | 8.39  |   |        | $           | 108,353,483 |  |  |   | 9,119,747 |  |  |  | 8.42 |  
|                                                   |       |         |             |             |              |      |          |            |      |         |         |      |   |              |             |             |        |         |   |            |  |  |              |       |   |        |            
|                                                  

|                                                   |       |         |            |            |              |      |          |           |  |         |         |      |   |              |            |            |        |  |   |           |  |  |  |      |   |  |  |  |  |  |  |  |  |  |  |  | 
|-------------------------------------------------- | ----- | ------- | ---------- | ---------- | ------------ | ---- | -------- | --------- |  | ------- | ------- | ---- | - | ------------ | ---------- | ---------- | ------ |  | - | --------- |  |  |  | ---- | - |  |  |  |  |  |  |  |  |  |  |  | 
|Year Ended December 31,                            |       |         | 2001       |            |              | 2000 |          |           |  |         |         |      |  
|                                                   |       |         |            |            |              |      |         
|                                                   |       | Net     |            |            |              |      | Net      |           |  |         |         |      |   |             
|                                                   |       | Average |            |            |              |      | Interest |           |  | Average |         |      |   |              | Interest   |            |        |  |   |           |  | 
|                                                   |       | Earning |            |            | Net Interest |      |          | Margin    |  |         | Earning |      |   | Net Interest |            |            | Margin |  |   |           |  |  |  |     
|                                                   |       | Assets  |            |            | Income       |      |          | Ratio     |  |         | Assets  |      |   | Income       |            |            | Ratio  |  |   |           |  |  |  |     
|                                                   |       |         |            |            |              |      |          |           | 
|Net Interest Margin (d)                            |       |         |            |            |              |      |          |           |  |         |         |      |   |              |            |            |        |  |   |           |  |  |  |      |   |  |  |  |  |  |  |  |  |  |  | 
|Investment securities and money market instruments |       | $       | 6,500,608  |            |              |      |          |           |  |         |         |      |   | $            | 5,051,619  |            |        |  |   |           |  |  |  |      |   |  |  |  |  |  |  |  |  |  |  | 
|Other interest-earning assets                      |       |         | 3,256,773  |            |              |      |          |           |  |         |         |      |   |              | 2,623,168  |            |        |  |   |           |  |  |  |      |   |  |  |  |  |  |  |  |  |  |  | 
|Loan receivables (b)                               |       |         | 20,339,388 |            |              |      |          |           |  |         |         |      |   |              | 17,718,148 |            |        |  |   |           |  |  |  |      |   |  |  |  |  |  |  |  |  |  |  | 
|                                                   |       |         |            |            |              |      |          |           |  |         |         |      |   |              |            |            |        |  |   |           |  |  |  |      |   |  | 
|                                                   | Total |         | $          | 30,096,769 |              |      | $        | 1,659,023 |  |         |         | 5.51 | % |              | $          | 25,392,935 |        |  | $ | 1,397,382 |  |  |  | 5.50 | % |  |  |  |  |  |  |  |  |  |  |  | 
|                                                   |       |         |            |            |              |      |          |           |  |         |         |      |   |              |            |            |        |  |   |           |  |  |  |      |   |  | 
|Securitization Adjustments                         |       |         |            |            |              |      |          |           |  |         |         |      |   |              |            |            |        |  |   |           |  |  |  |      |   |  |  |  |  |  |  |  |  |  |  | 
|Investment securities and money market instruments |       | $       |           |            |              |      |          |           |  |         |         |      |   | $            |           |            |        |  |   |           |  |  |  |      |   |  |  |  |  |  |  |  |  |  |  | 
|Other interest-earning assets                      |       |         | (3,197,381 | )          |              |      |          |           |  |         |         |      |   |              | (2,592,189 | )          |        |  |   |           |  |  |  |      |   |  |  |  |  |  |  |  |  |  |  | 
|Securitized loans                                  |       |         | 70,560,600 |            |              |      |          |           |  |         |         |      |   |              | 59,726,838 |            |        |  |   |           |  |  |  |      |   |  |  |  |  |  |  |  |  |  |  | 
|                                                   |       |         |            |            |              |      |          |           |  |         |         |      |   |              |            |            |        |  |   |           |  |  |  |      |   |  | 
|                                                   | Total |         | $          | 67,363,219 |              |      |          | 6,546,802 |  |         |         | 9.72 |   |              | $          | 57,134,649 |        |  |   | 4,442,094 |  |  |  | 7.77 |   |  |  |  |  |  |  |  |  |  |  |  | 
|                                                   |       |         |            |            |              |      |          |           |  |         |         |      |   |              |            |            |        |  |   |           |  |  |  |      |   |  | 
|Managed Net Interest Margin (d)                    |       |         |            |            |              |      |          |           |  |         |         |      |   |              |            |            |        |  |   |           |  |  |  |      |   |  |  |  |  |  |  |  |  |  |  | 
|Investment securities and money market instruments |       | $       | 6,500,608  |            |              |      |          |           |  |         |         |      |   | $            | 5,051,619  |            |        |  |   |           |  |  |  |      |   |  |  |  |  |  |  |  |  |  |  | 
|Other interest-earning assets                      |       |         | 59,392     |            |              |      |          |           |  |         |         |      |   |              | 30,979     |            |        |  |   |           |  |  |  |      |   |  |  |  |  |  |  |  |  |  |  | 
|Managed loans                                      |       |         | 90,899,988 |            |              |      |          |           |  |         |         |      |   |              | 77,444,986 |            |        |  |   |           |  |  |  |      |   |  |  |  |  |  |  |  |  |  |  | 
|                                                   |       |         |            |            |              |      |          |           |  |         |         |      |   |              |            |            |        |  |   |           |  |  |  |      |   |  | 
|                                                   | Total |         | $          | 97,459,988 |              |      |          | 8,205,825 |  |         |         | 8.42 |   |              | $          | 82,527,584 |        |  |   | 5,839,476 |  |  |  | 7.08 |   |  |  |  |  |  |  |  |  |  |  |  | 
|                                                   |       |         |            |            |              |      |          |           |  |         |         |      |   |              |            |            |        |  |   |           |  |  |  |      |   |  | 
|                                                  



|    |  |                                                                                                                                                                                                                                                                                                                     
|--- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) |  | MBNA Corporations net credit loss ratio is calculated by
    dividing annualized net credit losses, which exclude
    uncollectible accrued interest and fees and fraud losses, for
    the period by average loans, which include estimated collectible
    billed interest and fees for the corresponding period.
|   
|(b) |  | Loan receivables include loans held for securitization and the
    loan portfolio.                                                                                                                                                                                                                                  
|   
|(c) |  | Delinquency represents accruing loans that are 30 days or
    more past due.                                                                                                                                                                                                                                        
|   
|(d) |  | Net interest margin ratios are presented on a fully taxable
    equivalent basis. The fully taxable equivalent adjustment for
    the twelve months ended December 31, 2004, 2003, 2002,
    2001, and 2000 was $989, $759, $1,070, $1,683, and $2,367,
    respectively.                                           







---



##### 



MANAGEMENTS REPORT ON INTERNAL CONTROL OVER FINANCIAL
REPORTING








| |                                                                                                                                                                                                                                                                                                                                                                                 
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (i) pertain to the maintenance of records that, in
    reasonable detail, accurately and fairly reflect the
    transactions and dispositions of the assets of the Corporation;                                                                                                                                                                                                 
|
| | (ii) provide reasonable assurance that transactions are
    recorded as necessary to permit preparation of financial
    statements in accordance with generally accepted accounting
    principles, and that receipts and expenditures of the
    Corporation are being made only in accordance with
    authorizations of management and directors of the
    Corporation; and
|
| | (iii) provide reasonable assurance regarding prevention or
    timely detection of unauthorized acquisition, use or disposition
    of the Corporations assets that could have a material
    effect on the financial statements.                                                                                                                                              



Internal ControlIntegrated Framework






























---



##### 



REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM




Internal ControlIntegrated Framework














| |                
| | ---------------
| | (ERNST & YOUNG)













---



##### 



REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM










Internal ControlIntegrated
Framework




| |                    
| | -------------------
| | (ERNST & YOUNG LLP)













---



##### 



CONSOLIDATED STATEMENTS OF FINANCIAL
CONDITION (dollars in
thousands, except per share amounts)


|                                                                                                                                                                                             |                                                                                                                  |                                            |            |            |            |      |            |            |            | 
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---------------------------------------------------------------------------------------------------------------- | ------------------------------------------ | ---------- | ---------- | ---------- | ---- | ---------- | ---------- | ---------- | 
|December 31,                                                                                                                                                                                 |                                                                                                                  |                                            | 2004       |            |            | 2003 |           
|                                                                                                                                                                                             |                                                                                                                 
|ASSETS                                                                                                                                                                                      
|Cash and due from banks                                                                                                                                                                      |                                                                                                                  | $                                          | 949,706    |            |            | $    | 660,022    |           
|Interest-earning time deposits in other banks                                                                                                                                                |                                                                                                                  |                                            | 2,767,831  |            |            |      | 3,590,329  |           
|Federal funds sold                                                                                                                                                                           |                                                                                                                  |                                            | 1,605,000  |            |            |      | 1,275,000  |           
|Investment securities:                                                                                                                                                                       |                                                                                                                  |                                            |            |            |            |      |            |           
|                                                                                                                                                                                             | Available-for-sale (amortized cost of $6,083,252 and $4,352,069
    at December 31, 2004 and 2003, respectively) |                                            |            | 6,062,520  |            |      |            | 4,363,087  |           
|                                                                                                                                                                                             | Held-to-maturity (market value of $300,072 and $354,434 at
    December 31, 2004 and 2003, respectively)         |                                            |            | 299,074    |            |      |            | 353,299    |           
|Loans held for securitization                                                                                                                                                                |                                                                                                                  |                                            | 8,239,487  |            |            |      | 13,084,105 |           
|Loan portfolio:                                                                                                                                                                              |                                                                                                                  |                                            |            |            |            |      |            |           
|                                                                                                                                                                                             | Credit card                                                                                                      |                                            |            | 12,468,200 |            |      |            | 11,190,382 |           
|                                                                                                                                                                                             | Other consumer                                                                                                   |                                            |            | 9,089,065  |            |      |            | 8,017,730  |           
|                                                                                                                                                                                             | Commercial                                                                                                       |                                            |            | 3,962,098  |            |      |            | 1,331,860  |           
|                                                                                                                                                                                             |                                                                                                                  |                                            |            |            |            |     
|                                                                                                                                                                                             |                                                                                                                  | Total loan portfolio                       |            |            | 25,519,363 |      |            |            | 20,539,972 | 
|                                                                                                                                                                                             |                                                                                                                  |                                            |            |            |            |     
|                                                                                                                                                                                             |                                                                                                                  | Total loan receivables                     |            |            | 33,758,850 |      |            |            | 33,624,077 | 
|                                                                                                                                                                                             | Reserve for possible credit losses                                                                               |                                            |            | (1,136,558 | )          |      |            | (1,216,316 | )         
|                                                                                                                                                                                             |                                                                                                                  |                                            |            |            |            |     
|                                                                                                                                                                                             |                                                                                                                  | Net loan receivables                       |            |            | 32,622,292 |      |            |            | 32,407,761 | 
|Premises and equipment, net                                                                                                                                                                  |                                                                                                                  |                                            | 2,787,755  |            |            |      | 2,676,597  |           
|Accrued income receivable                                                                                                                                                                    |                                                                                                                  |                                            | 397,063    |            |            |      | 443,755    |           
|Accounts receivable from securitization                                                                                                                                                      |                                                                                                                  |                                            | 8,443,849  |            |            |      | 7,766,477  |           
|Intangible assets and goodwill, net                                                                                                                                                          |                                                                                                                  |                                            | 3,572,667  |            |            |      | 3,188,368  |           
|Prepaid expenses and deferred charges                                                                                                                                                        |                                                                                                                  |                                            | 438,804    |            |            |      | 499,775    |           
|Other assets                                                                                                                                                                                 |                                                                                                                  |                                            | 1,767,579  |            |            |      | 1,888,885  |           
|                                                                                                                                                                                             |                                                                                                                  |                                            |            |            |            |     
|                                                                                                                                                                                             |                                                                                                                  | Total assets                               |            | $          | 61,714,140 |      |            | $          | 59,113,355 | 
|                                                                                                                                                                                             |                                                                                                                  |                                            |            |            |            |     
|                                                                                                                                                                                            
|LIABILITIES                                                                                                                                                                                 
|Deposits:                                                                                                                                                                                    |                                                                                                                  |                                            |            |            |            |      |            |           
|                                                                                                                                                                                             | Time deposits                                                                                                    |                                            | $          | 21,789,358 |            |      | $          | 21,528,882 |           
|                                                                                                                                                                                             | Money market deposit accounts                                                                                    |                                            |            | 6,582,997  |            |      |            | 7,790,726  |           
|                                                                                                                                                                                             | Noninterest-bearing deposits                                                                                     |                                            |            | 2,740,063  |            |      |            | 2,419,209  |           
|                                                                                                                                                                                             | Interest-bearing transaction accounts                                                                            |                                            |            | 49,781     |            |      |            | 47,334     |           
|                                                                                                                                                                                             | Savings accounts                                                                                                 |                                            |            | 77,305     |            |      |            | 49,930     |           
|                                                                                                                                                                                             |                                                                                                                  |                                            |            |            |            |     
|                                                                                                                                                                                             |                                                                                                                  | Total deposits                             |            |            | 31,239,504 |      |            |            | 31,836,081 | 
|Short-term borrowings                                                                                                                                                                        |                                                                                                                  |                                            | 2,104,414  |            |            |      | 1,025,463  |           
|Long-term debt and bank notes                                                                                                                                                                |                                                                                                                  |                                            | 11,422,900 |            |            |      | 12,145,628 |           
|Accrued interest payable                                                                                                                                                                     |                                                                                                                  |                                            | 286,313    |            |            |      | 319,227    |           
|Accrued expenses and other liabilities                                                                                                                                                       |                                                                                                                  |                                            | 3,337,757  |            |            |      | 2,673,916  |           
|                                                                                                                                                                                             |                                                                                                                  |                                            |            |            |            |     
|                                                                                                                                                                                             |                                                                                                                  | Total liabilities                          |            |            | 48,390,888 |      |            |            | 48,000,315 | 
|                                                                                                                                                                                            
|STOCKHOLDERS EQUITY                                                                                                                                                                         |                                                                                                                  |                                            |            |            |            |      |            |           
|Preferred stock ($.01 par value, 20,000,000 shares
    authorized, 8,573,882 shares issued and outstanding at
    December 31, 2004 and 2003)                                                |                                                                                                                  |                                            | 86         |            |            |      | 86         |           
|Common stock ($.01 par value, 1,500,000,000 shares
    authorized, 1,277,671,875 shares at December 31, 2004,
    and 1,277,597,840 shares at December 31, 2003, issued
    and outstanding) |                                                                                                                  |                                            | 12,777     |            |            |      | 12,776     |           
|Additional paid-in capital                                                                                                                                                                   |                                                                                                                  |                                            | 2,026,175  |            |            |      | 2,119,700  |           
|Retained earnings                                                                                                                                                                            |                                                                                                                  |                                            | 10,620,838 |            |            |      | 8,571,174  |           
|Accumulated other comprehensive income                                                                                                                                                       |                                                                                                                  |                                            | 663,376    |            |            |      | 409,304    |           
|                                                                                                                                                                                             |                                                                                                                  |                                            |            |            |            |     
|                                                                                                                                                                                             |                                                                                                                  | Total stockholders equity                 |            |            | 13,323,252 |      |            |            | 11,113,040 | 
|                                                                                                                                                                                             |                                                                                                                  |                                            |            |            |            |     
|                                                                                                                                                                                             |                                                                                                                  | Total liabilities and stockholders equity |            | $          | 61,714,140 |      |            | $          | 59,113,355 | 
|                                                                                                                                                                                             |                                                                                                                  |                                            |            |            |            |     
|                                                                                                                                                                                            









---



##### 



CONSOLIDATED STATEMENTS OF
INCOME (dollars in
thousands, except per share amounts)


|                                                               |            |                               |           |         |           |      |           |         |           |   |           |         |           | 
|-------------------------------------------------------------- | ---------- | ----------------------------- | --------- | ------- | --------- | ---- | --------- | ------- | --------- | - | --------- | ------- | --------- | 
|Year Ended December 31,                                        |            |                               | 2004      |         |           | 2003 |           |         | 2002      |  
|                                                               |           
|Interest Income                                                |            |                               |           |         |           |      |           |         |           |   |           |        
|Loan portfolio                                                 |            | $                             | 2,426,617 |         |           | $    | 2,216,256 |         |           | $ | 2,037,454 |        
|Loans held for securitization                                  |            |                               | 1,065,005 |         |           |      | 1,112,977 |         |           |   | 1,056,558 |        
|Investment securities:                                         |            |                               |           |         |           |      |           |         |           |   |           |        
|                                                               | Taxable    |                               |           | 128,528 |           |      |           | 110,370 |           |   |           | 134,411 |          
|                                                               | Tax-exempt |                               |           | 1,559   |           |      |           | 1,417   |           |   |           | 1,895   |          
|Time deposits in other banks                                   |            |                               | 102,897   |         |           |      | 79,259    |         |           |   | 53,133    |        
|Federal funds sold                                             |            |                               | 28,112    |         |           |      | 33,137    |         |           |   | 35,460    |        
|Other interest income                                          |            |                               | 315,901   |         |           |      | 305,468   |         |           |   | 359,159   |        
|                                                               |            |                               |           |         |           |      |           |         |          
|                                                               |            | Total interest income         |           |         | 4,068,619 |      |           |         | 3,858,884 |   |           |         | 3,678,070 | 
|Interest Expense                                               |            |                               |           |         |           |      |           |         |           |   |           |        
|Deposits                                                       |            |                               | 981,827   |         |           |      | 1,107,806 |         |           |   | 1,255,527 |        
|Short-term borrowings                                          |            |                               | 76,910    |         |           |      | 39,132    |         |           |   | 42,978    |        
|Long-term debt and bank notes                                  |            |                               | 473,081   |         |           |      | 361,573   |         |           |   | 304,990   |        
|                                                               |            |                               |           |         |           |      |           |         |          
|                                                               |            | Total interest expense        |           |         | 1,531,818 |      |           |         | 1,508,511 |   |           |         | 1,603,495 | 
|                                                               |            |                               |           |         |           |      |           |         |          
|Net Interest Income                                            |            |                               | 2,536,801 |         |           |      | 2,350,373 |         |           |   | 2,074,575 |        
|Provision for possible credit losses                           |            |                               | 1,146,855 |         |           |      | 1,392,701 |         |           |   | 1,340,157 |        
|                                                               |            |                               |           |         |           |      |           |         |          
|Net interest income after provision for possible credit losses |            |                               | 1,389,946 |         |           |      | 957,672   |         |           |   | 734,418   |        
|Other Operating Income                                         |            |                               |           |         |           |      |           |         |           |   |           |        
|Securitization income                                          |            |                               | 6,753,308 |         |           |      | 6,523,956 |         |           |   | 5,666,352 |        
|Interchange                                                    |            |                               | 442,104   |         |           |      | 391,827   |         |           |   | 357,410   |        
|Credit card loan fees                                          |            |                               | 515,915   |         |           |      | 467,166   |         |           |   | 353,105   |        
|Other consumer loan fees                                       |            |                               | 170,592   |         |           |      | 108,072   |         |           |   | 100,429   |        
|Commercial loan fees                                           |            |                               | 69,568    |         |           |      | 46,593    |         |           |   | 32,750    |        
|Insurance                                                      |            |                               | 200,536   |         |           |      | 231,941   |         |           |   | 181,474   |        
|Other                                                          |            |                               | 106,363   |         |           |      | 55,925    |         |           |   | 61,403    |        
|                                                               |            |                               |           |         |           |      |           |         |          
|                                                               |            | Total other operating income  |           |         | 8,258,386 |      |           |         | 7,825,480 |   |           |         | 6,752,923 | 
|Other Operating Expense                                        |            |                               |           |         |           |      |           |         |           |   |           |        
|Salaries and employee benefits                                 |            |                               | 2,221,201 |         |           |      | 2,083,120 |         |           |   | 1,947,389 |        
|Occupancy expense of premises                                  |            |                               | 184,382   |         |           |      | 176,114   |         |           |   | 171,989   |        
|Furniture and equipment expense                                |            |                               | 404,763   |         |           |      | 351,501   |         |           |   | 334,287   |        
|Other                                                          |            |                               | 2,706,357 |         |           |      | 2,513,412 |         |           |   | 2,248,260 |        
|                                                               |            |                               |           |         |           |      |           |         |          
|                                                               |            | Total other operating expense |           |         | 5,516,703 |      |           |         | 5,124,147 |   |           |         | 4,701,925 | 
|                                                               |            |                               |           |         |           |      |           |         |          
|Income Before Income Taxes                                     |            |                               | 4,131,629 |         |           |      | 3,659,005 |         |           |   | 2,785,416 |        
|Applicable income taxes                                        |            |                               | 1,454,333 |         |           |      | 1,320,901 |         |           |   | 1,019,462 |        
|                                                               |            |                               |           |         |           |      |           |         |          
|Net Income                                                     |            | $                             | 2,677,296 |         |           | $    | 2,338,104 |         |           | $ | 1,765,954 |        
|                                                               |            |                               |           |         |           |      |           |         |          
|Earnings Per Common Share                                      |            | $                             | 2.08      |         |           | $    | 1.82      |         |           | $ | 1.37      |        
|Earnings Per Common ShareAssuming Dilution                    |            |                               | 2.05      |         |           |      | 1.79      |         |           |   | 1.34      |        
|Dividends Per Common Share                                     |            |                               | .48       |         |           |      | .36       |         |           |   | .27       |        
|                                                               |            |                               |           |         |           |      |           |         |          











---



##### 



CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS
EQUITY (dollars in
thousands, except per share amounts)


|                                                |                            |                                                                                                                                            |       |   |        |  |           |           |   |       |        |   |   |         |        |   |          |   |            |               |   |   |               |           |   |   |         |   |         |   |            |           |         |  
|----------------------------------------------- | -------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------ | ----- | - | ------ |  | --------- | --------- | - | ----- | ------ | - | - | ------- | ------ | - | -------- | - | ---------- | ------------- | - | - | ------------- | --------- | - | - | ------- | - | ------- | - | ---------- | --------- | ------- | -
|                                                |                            | Outstanding Shares                                                                                                                         |       |   |        |  |           |           |   |       |        |   |   |         |       
|                                                |                           
|                                                |                            | Accumulated                                                                                                                                |       |   |       
|                                                |                            | Additional                                                                                                                                 |       |   |        |  | Other     |           |   | Total |       
|                                                |                            | Preferred                                                                                                                                  |       |   | Common |  |           | Preferred |   |       | Common |   |   | Paid-in |        |   | Retained |   |            | Comprehensive |   |   | Stockholders |          
|                                                |                            | (000)                                                                                                                                      |       |   | (000)  |  |           | Stock     |   |       | Stock  |   |   | Capital |        |   | Earnings |   |            | Income        |   |   | Equity        |          
|                                                |                            |                                                                                                                                            |      
|Balance, December 31, 2001                      |                            |                                                                                                                                            | 8,574 |   |        |  | 1,277,672 |           |   | $     | 86     |   |   | $       | 12,777 |   |          | $ | 2,529,563  |               |   | $ | 5,304,725     |           |   | $ | (48,433 | ) |         | $ | 7,798,718  |          
|Comprehensive income:                           |                            |                                                                                                                                            |       |   |        |  |           |           |   |       |        |   |   |         |        |   |          |   |            |               |   |   |               |           |   |   |         |   |         |   |            |          
|                                                | Net income                 |                                                                                                                                            |       |  |        |  |           |          |   |       |        |  |   |         |        |  |          |   |            |              |   |   |               | 1,765,954 |   |   |         |  |         |   |            | 1,765,954 |        
|                                                |                            | Foreign currency translation (accumulated amount of $64,817 at
    December 31, 2002)                                                      |       |   |       |  |           |           |  |       |        |   |  |         |        |   |         |   |            |               |  |   |               |           |  |   |         |   | 140,757 |   |            |           | 140,757 |  
|                                                |                            | Net unrealized losses on investment securities
    available-for-sale, net of tax (accumulated gain of $24,185 at
    December 31, 2002)   |       |   |       |  |           |           |  |       |        |   |  |         |        |   |         |   |            |               |  |   |               |           |  |   |         |   | (3,322  | ) |            |           | (3,322  | )
|                                                |                            | Minimum benefit plan liability adjustment, net of tax
    (accumulated amount of ($4,276) at December 31, 2002)                            |       |   |       |  |           |           |  |       |        |   |  |         |        |   |         |   |            |               |  |   |               |           |  |   |         |   | (4,276  | ) |            |           | (4,276  | )
|                                                |                            |                                                                                                                                            |       |   |        |  |           |           |   |       |        |   |   |         |        |   |          |   |            |               |   |   |               |          
|                                                | Other comprehensive income |                                                                                                                                            |       |  |        |  |           |          |   |       |        |  |   |         |        |  |          |   |            |              |   |   |               |          |   |   |         |  |         |   |            | 133,159   |        
|                                                |                            |                                                                                                                                            |       |   |        |  |           |           |   |       |        |   |   |         |        |   |          |   |            |               |   |   |               |          
|Comprehensive income                            |                            |                                                                                                                                            |      |   |        |  |          |           |   |       |       |   |   |         |       |   |          |   |           |               |   |   |              |           |   |   |        |   |         |   | 1,899,113  |          
|Cash dividends:                                 |                            |                                                                                                                                            |       |   |        |  |           |           |   |       |        |   |   |         |        |   |          |   |            |               |   |   |               |           |   |   |         |   |         |   |            |          
|                                                | Common $.27 per share     |                                                                                                                                            |       |  |        |  |           |          |   |       |        |  |   |         |        |  |          |   |            |              |   |   |               | (349,339  | ) |   |         |  |         |   |            | (349,339  | )      
|                                                | Preferred                  |                                                                                                                                            |       |  |        |  |           |          |   |       |        |  |   |         |        |  |          |   |            |              |   |   |               | (14,178   | ) |   |         |  |         |   |            | (14,178   | )      
|Exercise of stock options and other awards      |                            |                                                                                                                                            |      |   |        |  | 25,521    |           |   |       |       |   |   |         | 255    |   |          |   | 138,167    |               |   |   |              |           |   |   |        |   |         |   | 138,422    |          
|Stock-based compensation tax benefit            |                            |                                                                                                                                            |      |   |        |  |          |           |   |       |       |   |   |         |       |   |          |   | 149,914    |               |   |   |              |           |   |   |        |   |         |   | 149,914    |          
|Amortization of deferred compensation expense   |                            |                                                                                                                                            |      |   |        |  |          |           |   |       |       |   |   |         |       |   |          |   | 94,172     |               |   |   |              |           |   |   |        |   |         |   | 94,172     |          
|Acquisition and retirement of common stock      |                            |                                                                                                                                            |      |   |        |  | (25,521   | )         |   |       |       |   |   |         | (255   | ) |          |   | (615,248   | )             |   |   |              |           |   |   |        |   |         |   | (615,503   | )        
|                                                |                            |                                                                                                                                            |       |   |        |  |           |           |   |       |        |   |   |         |        |   |          |   |            |               |   |   |               |          
|Balance, December 31, 2002                      |                            |                                                                                                                                            | 8,574 |   |        |  | 1,277,672 |           |   |       | 86     |   |   |         | 12,777 |   |          |   | 2,296,568  |               |   |   | 6,707,162     |           |   |   | 84,726  |   |         |   | 9,101,319  |          
|Comprehensive income:                           |                            |                                                                                                                                            |       |   |        |  |           |           |   |       |        |   |   |         |        |   |          |   |            |               |   |   |               |           |   |   |         |   |         |   |            |          
|                                                | Net income                 |                                                                                                                                            |       |  |        |  |           |          |   |       |        |  |   |         |        |  |          |   |            |              |   |   |               | 2,338,104 |   |   |         |  |         |   |            | 2,338,104 |        
|                                                |                            | Foreign currency translation (accumulated amount of $417,617 at
    December 31, 2003)                                                     |       |   |       |  |           |           |  |       |        |   |  |         |        |   |         |   |            |               |  |   |               |           |  |   |         |   | 352,800 |   |            |           | 352,800 |  
|                                                |                            | Net unrealized losses on investment securities
    available-for-sale, net of tax (accumulated gain of $6,901 at
    December 31, 2003)    |       |   |       |  |           |           |  |       |        |   |  |         |        |   |         |   |            |               |  |   |               |           |  |   |         |   | (17,284 | ) |            |           | (17,284 | )
|                                                |                            | Minimum benefit plan liability adjustment, net of tax
    (accumulated amount of ($15,214) at December 31, 2003)                           |       |   |       |  |           |           |  |       |        |   |  |         |        |   |         |   |            |               |  |   |               |           |  |   |         |   | (10,938 | ) |            |           | (10,938 | )
|                                                |                            |                                                                                                                                            |       |   |        |  |           |           |   |       |        |   |   |         |        |   |          |   |            |               |   |   |               |          
|                                                | Other comprehensive income |                                                                                                                                            |       |  |        |  |           |          |   |       |        |  |   |         |        |  |          |   |            |              |   |   |               |          |   |   |         |  |         |   |            | 324,578   |        
|                                                |                            |                                                                                                                                            |       |   |        |  |           |           |   |       |        |   |   |         |        |   |          |   |            |               |   |   |               |          
|Comprehensive income                            |                            |                                                                                                                                            |      |   |        |  |          |           |   |       |       |   |   |         |       |   |          |   |           |               |   |   |              |           |   |   |        |   |         |   | 2,662,682  |          
|Cash dividends:                                 |                            |                                                                                                                                            |       |   |        |  |           |           |   |       |        |   |   |         |        |   |          |   |            |               |   |   |               |           |   |   |         |   |         |   |            |          
|                                                | Common$.36 per share      |                                                                                                                                            |       |  |        |  |           |          |   |       |        |  |   |         |        |  |          |   |            |              |   |   |               | (460,028  | ) |   |         |  |         |   |            | (460,028  | )      
|                                                | Preferred                  |                                                                                                                                            |       |  |        |  |           |          |   |       |        |  |   |         |        |  |          |   |            |              |   |   |               | (14,064   | ) |   |         |  |         |   |            | (14,064   | )      
|Exercise of stock options and other awards      |                            |                                                                                                                                            |      |   |        |  | 29,152    |           |   |       |       |   |   |         | 291    |   |          |   | 275,502    |               |   |   |              |           |   |   |        |   |         |   | 275,793    |          
|Stock-based compensation tax benefit            |                            |                                                                                                                                            |      |   |        |  |          |           |   |       |       |   |   |         |       |   |          |   | 77,915     |               |   |   |              |           |   |   |        |   |         |   | 77,915     |          
|Issuance of common stock, net of issuance costs |                            |                                                                                                                                            |      |   |        |  | 50,000    |           |   |       |       |   |   |         | 500    |   |          |   | 1,081,686  |               |   |   |              |           |   |   |        |   |         |   | 1,082,186  |          
|Amortization of deferred compensation expense   |                            |                                                                                                                                            |      |   |        |  |          |           |   |       |       |   |   |         |       |   |          |   | 88,061     |               |   |   |              |           |   |   |        |   |         |   | 88,061     |          
|Acquisition and retirement of common stock      |                            |                                                                                                                                            |      |   |        |  | (79,226   | )         |   |       |       |   |   |         | (792   | ) |          |   | (1,700,032 | )             |   |   |              |           |   |   |        |   |         |   | (1,700,824 | )        
|                                                |                            |                                                                                                                                            |       |   |        |  |           |           |   |       |        |   |   |         |        |   |          |   |            |               |   |   |               |          
|Balance, December 31, 2003                      |                            |                                                                                                                                            | 8,574 |   |        |  | 1,277,598 |           |   |       | 86     |   |   |         | 12,776 |   |          |   | 2,119,700  |               |   |   | 8,571,174     |           |   |   | 409,304 |   |         |   | 11,113,040 |          
|Comprehensive income:                           |                            |                                                                                                                                            |       |   |        |  |           |           |   |       |        |   |   |         |        |   |          |   |            |               |   |   |               |           |   |   |         |   |         |   |            |          
|                                                | Net income                 |                                                                                                                                            |       |  |        |  |           |          |   |       |        |  |   |         |        |  |          |   |            |              |   |   |               | 2,677,296 |   |   |         |  |         |   |            | 2,677,296 |        
|                                                |                            | Foreign currency translation (accumulated amount of $680,636 at
    December 31, 2004)                                                     |       |   |       |  |           |           |  |       |        |   |  |         |        |   |         |   |            |               |  |   |               |           |  |   |         |   | 263,019 |   |            |           | 263,019 |  
|                                                |                            | Net unrealized losses on investment securities
    available-for-sale, net of tax (accumulated loss of ($13,561) at
    December 31, 2004) |       |   |       |  |           |           |  |       |        |   |  |         |        |   |         |   |            |               |  |   |               |           |  |   |         |   | (20,462 | ) |            |           | (20,462 | )
|                                                |                            | Minimum benefit plan liability adjustment, net of tax
    (accumulated amount of ($3,699) at December 31, 2004)                            |       |   |       |  |           |           |  |       |        |   |  |         |        |   |         |   |            |               |  |   |               |           |  |   |         |   | 11,515  |   |            |           | 11,515  |  
|                                                |                            |                                                                                                                                            |       |   |        |  |           |           |   |       |        |   |   |         |        |   |          |   |            |               |   |   |               |          
|                                                | Other comprehensive income |                                                                                                                                            |       |  |        |  |           |          |   |       |        |  |   |         |        |  |          |   |            |              |   |   |               |          |   |   |         |  |         |   |            | 254,072   |        
|                                                |                            |                                                                                                                                            |       |   |        |  |           |           |   |       |        |   |   |         |        |   |          |   |            |               |   |   |               |          
|Comprehensive income                            |                            |                                                                                                                                            |      |   |        |  |          |           |   |       |       |   |   |         |       |   |          |   |           |               |   |   |              |           |   |   |        |   |         |   | 2,931,368  |          
|Cash dividends:                                 |                            |                                                                                                                                            |       |   |        |  |           |           |   |       |        |   |   |         |        |   |          |   |            |               |   |   |               |           |   |   |         |   |         |   |            |          
|                                                | Common $.48 per share     |                                                                                                                                            |       |  |        |  |           |          |   |       |        |  |   |         |        |  |          |   |            |              |   |   |               | (613,568  | ) |   |         |  |         |   |            | (613,568  | )      
|                                                | Preferred                  |                                                                                                                                            |       |  |        |  |           |          |   |       |        |  |   |         |        |  |          |   |            |              |   |   |               | (14,064   | ) |   |         |  |         |   |            | (14,064   | )      
|Exercise of stock options and other awards      |                            |                                                                                                                                            |      |   |        |  | 16,805    |           |   |       |       |   |   |         | 168    |   |          |   | 192,105    |               |   |   |              |           |   |   |        |   |         |   | 192,273    |          
|Stock-based compensation tax benefit            |                            |                                                                                                                                            |      |   |        |  |          |           |   |       |       |   |   |         |       |   |          |   | 58,966     |               |   |   |              |           |   |   |        |   |         |   | 58,966     |          
|Amortization of deferred compensation expense   |                            |                                                                                                                                            |      |   |        |  |          |           |   |       |       |   |   |         |       |   |          |   | 87,630     |               |   |   |              |           |   |   |        |   |         |   | 87,630     |          
|Acquisition and retirement of common stock      |                            |                                                                                                                                            |      |   |        |  | (16,731   | )         |   |       |       |   |   |         | (167   | ) |          |   | (432,226   | )             |   |   |              |           |   |   |        |   |         |   | (432,393   | )        
|                                                |                            |                                                                                                                                            |       |   |        |  |           |           |   |       |        |   |   |         |        |   |          |   |            |               |   |   |               |          
|Balance, December 31, 2004                      |                            |                                                                                                                                            | 8,574 |   |        |  | 1,277,672 |           |   | $     | 86     |   |   | $       | 12,777 |   |          | $ | 2,026,175  |               |   | $ | 10,620,838    |           |   | $ | 663,376 |   |         | $ | 13,323,252 |          
|                                                |                            |                                                                                                                                            |       |   |        |  |           |           |   |       |        |   |   |         |        |   |          |   |            |               |   |   |               |          
|                                               









---



##### 



CONSOLIDATED STATEMENTS OF CASH
FLOWS (dollars in
thousands)


|                                                                                                                                                            |                                                                |                                                     |             |           |            |   |            |           |            |   |             |           |            |  
|----------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------- | --------------------------------------------------- | ----------- | --------- | ---------- | - | ---------- | --------- | ---------- | - | ----------- | --------- | ---------- | -
|Year Ended December 31,                                                                                                                                     |                                                                | 2004                                                |             |           | 2003       |   |            | 2002     
|                                                                                                                                                            |                                                               
|Operating Activities                                                                                                                                        |                                                                |                                                     |             |           |            |   |            |           |            |   |             |          
|Net income                                                                                                                                                  |                                                                | $                                                   | 2,677,296   |           |            | $ | 2,338,104  |           |            | $ | 1,765,954   |          
|Adjustments to reconcile net income to net cash provided by
    operating activities:                                                                       |                                                                |                                                     |             |           |            |   |            |           |            |   |             |          
|                                                                                                                                                            | Provision for possible credit losses                           |                                                     |             | 1,146,855 |            |   |            | 1,392,701 |            |   |             | 1,340,157 |           
|                                                                                                                                                            | Depreciation, amortization, and accretion                      |                                                     |             | 952,652   |            |   |            | 861,459   |            |   |             | 779,638   |           
|                                                                                                                                                            | Provision (benefit) for deferred income taxes                  |                                                     |             | 110,548   |            |   |            | (1,980    | )          |   |             | (151,707  | )         
|                                                                                                                                                            | Decrease (increase) in accrued income receivable               |                                                     |             | 61,873    |            |   |            | (57,524   | )          |   |             | 5,282     |           
|                                                                                                                                                            | (Increase) decrease in accounts receivable from securitization |                                                     |             | (599,867  | )          |   |            | (698,229  | )          |   |             | 602,160   |           
|                                                                                                                                                            | (Decrease) increase in accrued interest payable                |                                                     |             | (44,258   | )          |   |            | 23,700    |            |   |             | 53,861    |           
|                                                                                                                                                            | Decrease in other operating activities                         |                                                     |             | 328,281   |            |   |            | 4,756     |            |   |             | 386,697   |           
|                                                                                                                                                            |                                                                |                                                     |             |           |            |   |            |           |           
|                                                                                                                                                            |                                                                | Net cash provided by operating activities           |             |           | 4,633,380  |   |            |           | 3,862,987  |   |             |           | 4,782,042  |  
|Investing Activities                                                                                                                                        |                                                                |                                                     |             |           |            |   |            |           |            |   |             |          
|Net decrease (increase) in money market instruments                                                                                                         |                                                                |                                                     | 625,186     |           |            |   | 622,732    |           |            |   | (2,271,289  | )        
|Proceeds from maturities of investment securities
    available-for-sale                                                                                    |                                                                |                                                     | 1,606,131   |           |            |   | 1,802,968  |           |            |   | 1,054,876   |          
|Proceeds from sale of investment securities available-for-sale                                                                                              |                                                                |                                                     | 1,273       |           |            |   |           |           |            |   | 13,126      |          
|Purchases of investment securities available-for-sale                                                                                                       |                                                                |                                                     | (3,307,893  | )         |            |   | (2,520,608 | )         |            |   | (1,606,729  | )        
|Proceeds from maturities of investment securities
    held-to-maturity                                                                                      |                                                                |                                                     | 85,309      |           |            |   | 89,741     |           |            |   | 45,752      |          
|Purchases of investment securities held-to-maturity                                                                                                         |                                                                |                                                     | (30,801     | )         |            |   | (23,016    | )         |            |   | (81,596     | )        
|Proceeds from securitization of loans                                                                                                                       |                                                                |                                                     | 12,206,950  |           |            |   | 13,598,329 |           |            |   | 15,373,055  |          
|Acquisitions of businesses                                                                                                                                  |                                                                |                                                     | (355,688    | )         |            |   |           |           |            |   |            |          
|Loan portfolio acquisitions                                                                                                                                 |                                                                |                                                     | (2,566,540  | )         |            |   | (2,232,049 | )         |            |   | (4,479,966  | )        
|Increase in loans due to principal payments to investors in the
    Corporations securitization transactions                                               |                                                                |                                                     | (10,220,823 | )         |            |   | (8,542,510 | )         |            |   | (10,195,864 | )        
|Net loan repayments (originations)                                                                                                                          |                                                                |                                                     | 1,547,705   |           |            |   | (8,427,255 | )         |            |   | (6,294,442  | )        
|Net purchases of premises and equipment                                                                                                                     |                                                                |                                                     | (527,429    | )         |            |   | (414,833   | )         |            |   | (551,208    | )        
|                                                                                                                                                            |                                                                |                                                     |             |           |            |   |            |           |           
|                                                                                                                                                            |                                                                | Net cash used in investing activities               |             |           | (936,620   | ) |            |           | (6,046,501 | ) |             |           | (8,994,285 | )
|Financing Activities                                                                                                                                        |                                                                |                                                     |             |           |            |   |            |           |            |   |             |          
|Net (decrease) increase in money market deposit accounts,
    noninterest-bearing deposits, interest-bearing transaction
    accounts, and savings accounts |                                                                |                                                     | (876,879    | )         |            |   | 1,739,818  |           |            |   | 1,214,202   |          
|Net increase (decrease) in time deposits                                                                                                                    |                                                                |                                                     | 159,343     |           |            |   | (629,721   | )         |            |   | 2,161,613   |          
|Net decrease in short-term borrowings, excluding short-term
    borrowings assumed in acquisitions                                                          |                                                                |                                                     | (199,887    | )         |            |   | (264,713   | )         |            |   | (524,606    | )        
|Proceeds from issuance of long-term debt and bank notes                                                                                                     |                                                                |                                                     | 506,529     |           |            |   | 3,320,585  |           |            |   | 3,749,413   |          
|Maturity of long-term debt and bank notes                                                                                                                   |                                                                |                                                     | (2,158,583  | )         |            |   | (1,270,574 | )         |            |   | (1,803,816  | )        
|Proceeds from exercise of stock options and other awards                                                                                                    |                                                                |                                                     | 192,273     |           |            |   | 275,793    |           |            |   | 138,422     |          
|Acquisition and retirement of common stock                                                                                                                  |                                                                |                                                     | (432,393    | )         |            |   | (1,700,824 | )         |            |   | (615,503    | )        
|Proceeds from issuance of common stock                                                                                                                      |                                                                |                                                     |            |           |            |   | 1,082,186  |           |            |   |            |          
|Dividends paid                                                                                                                                              |                                                                |                                                     | (601,734    | )         |            |   | (435,800   | )         |            |   | (350,740    | )        
|                                                                                                                                                            |                                                                |                                                     |             |           |            |   |            |           |           
|                                                                                                                                                            |                                                                | Net cash (used in) provided by financing activities |             |           | (3,411,331 | ) |            |           | 2,116,750  |   |             |           | 3,968,985  |  
|Effect of exchange rate changes on cash and cash equivalents                                                                                                |                                                                |                                                     | 4,255       |           |            |   | 4,814      |           |            |   | 3,112       |          
|                                                                                                                                                            |                                                                |                                                     |             |           |            |   |            |           |           
|Increase (Decrease) in Cash and Cash Equivalents                                                                                                            |                                                                |                                                     | 289,684     |           |            |   | (61,950    | )         |            |   | (240,146    | )        
|Cash and cash equivalents at beginning of year                                                                                                              |                                                                |                                                     | 660,022     |           |            |   | 721,972    |           |            |   | 962,118     |          
|                                                                                                                                                            |                                                                |                                                     |             |           |            |   |            |           |           
|Cash and cash equivalents at end of year                                                                                                                    |                                                                | $                                                   | 949,706     |           |            | $ | 660,022    |           |            | $ | 721,972     |          
|                                                                                                                                                            |                                                                |                                                     |             |           |            |   |            |           |           
|Supplemental Disclosure                                                                                                                                     |                                                                |                                                     |             |           |            |   |            |           |            |   |             |          
|Interest expense paid                                                                                                                                       |                                                                | $                                                   | 1,537,322   |           |            | $ | 1,524,959  |           |            | $ | 1,589,080   |          
|                                                                                                                                                            |                                                                |                                                     |             |           |            |   |            |           |           
|Income taxes paid                                                                                                                                           |                                                                | $                                                   | 1,237,121   |           |            | $ | 1,002,682  |           |            | $ | 1,020,878   |          
|                                                                                                                                                            |                                                                |                                                     |             |           |            |   |            |           |           
|                                                                                                                                                           









---



##### 



NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS




NOTE 1: BUSINESS AND BASIS OF PRESENTATION
     NOTE 2: PRINCIPLES OF CONSOLIDATION




NOTE 3: SIGNIFICANT ACCOUNTING POLICIES
 INVESTMENT SECURITIES
  ASSET SECURITIZATION








---



##### 



LOAN RECEIVABLES
  LOANS HELD FOR SECURITIZATION
  RESERVE FOR POSSIBLE CREDIT LOSSES


DELINQUENT LOANS
  NONACCRUAL LOANS








---



##### 



LOAN RECEIVABLE FRAUD LOSSES
  PREMISES AND EQUIPMENT
    INTANGIBLE ASSETS AND GOODWILL











---



##### 



CLASSIFICATION OF MAJOR INTANGIBLE ASSETS AND
GOODWILL (dollars in
thousands)


|                              |                                      |          |           |           |              |      |           |           |  |   |           |           |  |              |           |           |          |   |           |           |  |   |           |           | 
|----------------------------- | ------------------------------------ | -------- | --------- | --------- | ------------ | ---- | --------- | --------- |  | - | --------- | --------- |  | ------------ | --------- | --------- | -------- | - | --------- | --------- |  | - | --------- | --------- | 
|December 31,                  |                                      |          | 2004      |           |              | 2003 |          
|                              |                                     
|                              |                                      | Gross    |           |           |              |      | Gross     |           |  |  
|                              |                                      | Carrying |           |           | Accumulated  |      |           | Net Book  |  |   | Carrying  |           |  | Accumulated  |           |           | Net Book |  
|                              |                                      | Value    |           |           | Amortization |      |           | Value     |  |   | Value     |           |  | Amortization |           |           | Value    |  
|                              |                                      |          |          
|PCCRs                         |                                      | $        | 5,139,430 |           |              | $    | 1,999,962 |           |  | $ | 3,139,468 |           |  | $            | 4,668,263 |           |          | $ | 1,580,848 |           |  | $ | 3,087,415 |          
|Other purchased relationships |                                      |          | 314,691   |           |              |      | 109,111   |           |  |   | 205,580   |           |  |              | 126,129   |           |          |   | 71,269    |           |  |   | 54,860    |          
|Goodwill                      |                                      |          | 185,220   |           |              |      |          |           |  |   | 185,220   |           |  |              |          |           |          |   |          |           |  |   |          |          
|Benefit plan intangible asset |                                      |          | 42,399    |           |              |      |          |           |  |   | 42,399    |           |  |              | 46,093    |           |          |   |          |           |  |   | 46,093    |          
|                              |                                      |          |           |           |              |      |           |           |  |   |           |           |  |              |           |           |          |  
|                              | Total intangible assets and goodwill |          | $         | 5,681,740 |              |      | $         | 2,109,073 |  |   | $         | 3,572,667 |  |              | $         | 4,840,485 |          |   | $         | 1,652,117 |  |   | $         | 3,188,368 | 
|                              |                                      |          |           |           |              |      |           |           |  |   |           |           |  |              |           |           |          |  
|                             



EXPECTED INTANGIBLE ASSET AMORTIZATION
 (dollars in thousands)
 2005
    
    $
    436,5192006
    
    
    407,3422007
    
    
    368,0762008
    
    
    334,8312009
    
    
    302,502 PREPAID EXPENSES AND DEFERRED CHARGES


COMPREHENSIVE INCOME
  INCOME TAXES
  STOCK-BASED EMPLOYEE COMPENSATION








---



##### 



PRO FORMA NET INCOME AND EARNINGS PER COMMON
SHARE (dollars in
thousands, except per share amounts)


|                                             |                                                                                                                                               |  |   |           |   |  |      |           |   |  |   |           |  
|-------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------------------------- |  | - | --------- | - |  | ---- | --------- | - |  | - | --------- | -
|Year Ended December 31,                      | 2004                                                                                                                                          |  |   | 2003      |   |  | 2002 |          
|                                            
|                                            
|Net Income                                   |                                                                                                                                               |  |   |           |   |  |      |           |   |  |   |          
|                                             | As reported                                                                                                                                   |  | $ | 2,677,296 |   |  | $    | 2,338,104 |   |  | $ | 1,765,954 |  
|                                             | Add: Stock-based employee compensation expense included in
    reported net income, net of related tax effects                                |  |   | 56,784    |   |  |      | 56,271    |   |  |   | 59,705    |  
|                                             | Deduct: Total stock-based employee compensation expense
    determined under fair value method for all awards, net of
    related tax effects |  |   | (110,894  | ) |  |      | (129,446  | ) |  |   | (143,718  | )
|                                             |                                                                                                                                               |  |   |           |   |  |      |           |  
|                                             | Pro forma                                                                                                                                     |  | $ | 2,623,186 |   |  | $    | 2,264,929 |   |  | $ | 1,681,941 |  
|                                             |                                                                                                                                               |  |   |           |   |  |      |           |  
|Earnings Per Common Share                    |                                                                                                                                               |  |   |           |   |  |      |           |   |  |   |          
|                                             | As reported                                                                                                                                   |  | $ | 2.08      |   |  | $    | 1.82      |   |  | $ | 1.37      |  
|                                             | Pro forma                                                                                                                                     |  |   | 2.04      |   |  |      | 1.76      |   |  |   | 1.31      |  
|Earnings Per Common Share Assuming Dilution |                                                                                                                                               |  |   |           |   |  |      |           |   |  |   |          
|                                             | As reported                                                                                                                                   |  |   | 2.05      |   |  |      | 1.79      |   |  |   | 1.34      |  
|                                             | Pro forma                                                                                                                                     |  |   | 2.01      |   |  |      | 1.74      |   |  |   | 1.28      |  
|                                            



pro forma
 WEIGHTED AVERAGE ASSUMPTIONS USED IN THE BLACK-SCHOLES
OPTION PRICING MODEL
 Year Ended December 31,
    
    2004
    
    2003
    
    2002Dividend yield
    
    
    1.37
    %
    
    
    1.11
    %
    
    
    1.10
    %Expected volatility
    
    
    32.48
    
    
    
    35.98
    
    
    
    34.21Risk-free interest rate
    
    
    3.51
    
    
    
    3.20
    
    
    
    4.50Weighted average expected life
    
    
    5.0  years
    
    
    
    5.4  years
    
    
    
    5.4  years   FOREIGN CURRENCY TRANSLATION


DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES








---



##### 





REVENUE RECOGNITION




INTERCHANGE
   INSURANCE
  ROYALTIES TO ENDORSING ORGANIZATIONS








---



##### 



STATEMENTS OF CASH FLOWS
  NOTE 4: NEW ACCOUNTING PRONOUNCEMENTS











---



##### 



NOTE 5: ACQUISITIONS
 PREMIUM CREDIT LIMITED
   SKY FINANCIAL SOLUTIONS, INC.


NOTE 6: CASH AND CASH EQUIVALENTS
  NOTE 7: INTEREST-EARNING TIME DEPOSITS IN OTHER BANKS
  NOTE 8: INVESTMENT SECURITIES








---



##### 









UNREALIZED LOSSES ON INVESTMENT
SECURITIES (dollars in
thousands)


|                                          |           |                                                                  |                                                         |         |                   |           |  |       |         |         |            |         |         |         |  |      |            |        |   |         |           |           |  |      |         |         |  
|----------------------------------------- | --------- | ---------------------------------------------------------------- | ------------------------------------------------------- | ------- | ----------------- | --------- |  | ----- | ------- | ------- | ---------- | ------- | ------- | ------- |  | ---- | ---------- | ------ | - | ------- | --------- | --------- |  | ---- | ------- | ------- | -
|                                          |           | Less than 12 months                                              |                                                         |         | 12 months or more |           |  | Total |        
|                                          |          
|                                          |           | Fair                                                             |                                                         |         | Unrealized        |           |  | Fair  |         |         | Unrealized |         |         | Fair    |  |      | Unrealized |       
|                                          |           | Value                                                            |                                                         |         | Losses            |           |  | Value |         |         | Losses     |         |         | Value   |  |      | Losses     |       
|                                          |           |                                                                  |                                                        
|December 31, 2004                         |           |                                                                  |                                                         |         |                   |           |  |       |         |         |            |         |         |         |  |      |            |        |   |         |           |           |  |     
|Investment securities available-for-sale: |           |                                                                  |                                                         |         |                   |           |  |       |         |         |            |         |         |         |  |      |            |        |   |         |           |           |  |     
|                                          | Domestic: |                                                                  |                                                         |         |                   |           |  |       |         |         |            |         |         |         |  |      |            |        |   |         |           |           |  |      |        
|                                          |           | U.S. Treasury and other U.S. government agencies
    obligations |                                                         | $       | 2,656,680         |           |  | $     | (17,937 | )       |            | $       |        |         |  | $    |           |        |   | $       | 2,656,680 |           |  | $    | (17,937 | )      
|                                          |           | State and political subdivisions of the United States            |                                                         |         |                  |           |  |       |        |         |            |         |        |         |  |      |           |        |   |         |          |           |  |      |        |        
|                                          |           | Asset-backed and other securities                                |                                                         |         | 1,121,933         |           |  |       | (7,548  | )       |            |         | 15,242  |         |  |      | (13        | )      |   |         | 1,137,175 |           |  |      | (7,561  | )      
|                                          |           |                                                                  |                                                         |         |                   |           |  |       |         |         |            |         |         |         |  |      |            |       
|                                          |           |                                                                  | Total domestic investment securities available-for-sale |         |                   | 3,778,613 |  |       |         | (25,485 | )          |         |         | 15,242  |  |      |            | (13    | ) |         |           | 3,793,855 |  |      |         | (25,498 | )
|                                          | Foreign   |                                                                  |                                                         | 62,500  |                   |           |  | (3    | )       |         |            | 186,175 |         |         |  | (331 | )          |        |   | 248,675 |           |           |  | (334 | )      
|                                          |           |                                                                  |                                                         |         |                   |           |  |       |         |         |            |         |         |         |  |      |            |       
|                                          |           |                                                                  | Total investment securities available-for-sale          |         | $                 | 3,841,113 |  |       | $       | (25,488 | )          |         | $       | 201,417 |  |      | $          | (344   | ) |         | $         | 4,042,530 |  |      | $       | (25,832 | )
|                                          |           |                                                                  |                                                         |         |                   |           |  |       |         |         |            |         |         |         |  |      |            |       
|Investment securities held-to-maturity:   |           |                                                                  |                                                         |         |                   |           |  |       |         |         |            |         |         |         |  |      |            |        |   |         |           |           |  |     
|                                          | Domestic: |                                                                  |                                                         |         |                   |           |  |       |         |         |            |         |         |         |  |      |            |        |   |         |           |           |  |      |        
|                                          |           | U.S. Treasury and other U.S. government agencies
    obligations |                                                         | $       | 20,323            |           |  | $     | (829    | )       |            | $       | 70,685  |         |  | $    | (1,846     | )      |   | $       | 91,008    |           |  | $    | (2,675  | )      
|                                          |           | State and political subdivisions of the United States            |                                                         |         |                  |           |  |       |        |         |            |         |        |         |  |      |           |        |   |         |          |           |  |      |        |        
|                                          |           | Asset-backed and other securities                                |                                                         |         | 10,514            |           |  |       | (388    | )       |            |         | 3,974   |         |  |      | (135       | )      |   |         | 14,488    |           |  |      | (523    | )      
|                                          |           |                                                                  |                                                         |         |                   |           |  |       |         |         |            |         |         |         |  |      |            |       
|                                          |           |                                                                  | Total domestic investment securities held-to-maturity   |         |                   | 30,837    |  |       |         | (1,217  | )          |         |         | 74,659  |  |      |            | (1,981 | ) |         |           | 105,496   |  |      |         | (3,198  | )
|                                          | Foreign   |                                                                  |                                                         |        |                   |           |  |      |         |         |            |        |         |         |  |     |            |        |   |        |           |           |  |     |        
|                                          |           |                                                                  |                                                         |         |                   |           |  |       |         |         |            |         |         |         |  |      |            |       
|                                          |           |                                                                  | Total investment securities held-to-maturity            |         | $                 | 30,837    |  |       | $       | (1,217  | )          |         | $       | 74,659  |  |      | $          | (1,981 | ) |         | $         | 105,496   |  |      | $       | (3,198  | )
|                                          |           |                                                                  |                                                         |         |                   |           |  |       |         |         |            |         |         |         |  |      |            |       
|December 31, 2003                         |           |                                                                  |                                                         |         |                   |           |  |       |         |         |            |         |         |         |  |      |            |        |   |         |           |           |  |     
|Investment securities available-for-sale: |           |                                                                  |                                                         |         |                   |           |  |       |         |         |            |         |         |         |  |      |            |        |   |         |           |           |  |     
|                                          | Domestic: |                                                                  |                                                         |         |                   |           |  |       |         |         |            |         |         |         |  |      |            |        |   |         |           |           |  |      |        
|                                          |           | U.S. Treasury and other U.S. government agencies
    obligations |                                                         | $       | 199,633           |           |  | $     | (266    | )       |            | $       |        |         |  | $    |           |        |   | $       | 199,633   |           |  | $    | (266    | )      
|                                          |           | State and political subdivisions of the United States            |                                                         |         |                  |           |  |       |        |         |            |         |        |         |  |      |           |        |   |         |          |           |  |      |        |        
|                                          |           | Asset-backed and other securities                                |                                                         |         | 113,669           |           |  |       | (44     | )       |            |         | 112,152 |         |  |      | (112       | )      |   |         | 225,821   |           |  |      | (156    | )      
|                                          |           |                                                                  |                                                         |         |                   |           |  |       |         |         |            |         |         |         |  |      |            |       
|                                          |           |                                                                  | Total domestic investment securities available-for-sale |         |                   | 313,302   |  |       |         | (310    | )          |         |         | 112,152 |  |      |            | (112   | ) |         |           | 425,454   |  |      |         | (422    | )
|                                          | Foreign   |                                                                  |                                                         | 427,753 |                   |           |  | (287  | )       |         |            |        |         |         |  |     |            |        |   | 427,753 |           |           |  | (287 | )      
|                                          |           |                                                                  |                                                         |         |                   |           |  |       |         |         |            |         |         |         |  |      |            |       
|                                          |           |                                                                  | Total investment securities available-for-sale          |         | $                 | 741,055   |  |       | $       | (597    | )          |         | $       | 112,152 |  |      | $          | (112   | ) |         | $         | 853,207   |  |      | $       | (709    | )
|                                          |           |                                                                  |                                                         |         |                   |           |  |       |         |         |            |         |         |         |  |      |            |       
|Investment securities held-to-maturity:   |           |                                                                  |                                                         |         |                   |           |  |       |         |         |            |         |         |         |  |      |            |        |   |         |           |           |  |     
|                                          | Domestic: |                                                                  |                                                         |         |                   |           |  |       |         |         |            |         |         |         |  |      |            |        |   |         |           |           |  |      |        
|                                          |           | U.S. Treasury and other U.S. government agencies
    obligations |                                                         | $       | 202,031           |           |  | $     | (3,773  | )       |            | $       |        |         |  | $    |           |        |   | $       | 202,031   |           |  | $    | (3,773  | )      
|                                          |           | State and political subdivisions of the United States            |                                                         |         |                  |           |  |       |        |         |            |         |        |         |  |      |           |        |   |         |          |           |  |      |        |        
|                                          |           | Asset-backed and other securities                                |                                                         |         | 8,079             |           |  |       | (211    | )       |            |         |        |         |  |      |           |        |   |         | 8,079     |           |  |      | (211    | )      
|                                          |           |                                                                  |                                                         |         |                   |           |  |       |         |         |            |         |         |         |  |      |            |       
|                                          |           |                                                                  | Total domestic investment securities held-to-maturity   |         |                   | 210,110   |  |       |         | (3,984  | )          |         |         |        |  |      |            |       |   |         |           | 210,110   |  |      |         | (3,984  | )
|                                          | Foreign   |                                                                  |                                                         |        |                   |           |  |      |         |         |            |        |         |         |  |     |            |        |   |        |           |           |  |     |        
|                                          |           |                                                                  |                                                         |         |                   |           |  |       |         |         |            |         |         |         |  |      |            |       
|                                          |           |                                                                  | Total investment securities held-to-maturity            |         | $                 | 210,110   |  |       | $       | (3,984  | )          |         | $       |        |  |      | $          |       |   |         | $         | 210,110   |  |      | $       | (3,984  | )
|                                          |           |                                                                  |                                                         |         |                   |           |  |       |         |         |            |         |         |         |  |      |            |       
|                                         







---



##### 



ESTIMATED MATURITIES OF INVESTMENT
SECURITIES (dollars in
thousands)


|                                         |           |                                        |                                                         |   |           |           |  |   |           |           | 
|---------------------------------------- | --------- | -------------------------------------- | ------------------------------------------------------- | - | --------- | --------- |  | - | --------- | --------- | 
|                                         |           | Amortized                              |                                                         |   | Market    |          
|December 31,
      2004                  |           |                                        | Cost                                                    |   |           | Value     | 
|                                         |          
|Investment Securities Available-for-Sale |           |                                        |                                                         |   |           |           |  |  
|                                         | Domestic: |                                        |                                                         |   |           |           |  |   |          
|                                         |           | Due within one year                    |                                                         | $ | 1,900,409 |           |  | $ | 1,893,062 |          
|                                         |           | Due after one year through five years  |                                                         |   | 3,497,297 |           |  |   | 3,483,540 |          
|                                         |           | Due after five years through ten years |                                                         |   | 80,406    |           |  |   | 80,250    |          
|                                         |           | Due after ten years                    |                                                         |   | 16        |           |  |   | 16        |          
|                                         |           |                                        |                                                         |   |           |          
|                                         |           |                                        | Total domestic investment securities available-for-sale |   |           | 5,478,128 |  |   |           | 5,456,868 | 
|                                         | Foreign:  |                                        |                                                         |   |           |           |  |   |          
|                                         |           | Due within one year                    |                                                         |   | 489,041   |           |  |   | 489,130   |          
|                                         |           | Due after one year through five years  |                                                         |   | 116,083   |           |  |   | 116,522   |          
|                                         |           |                                        |                                                         |   |           |          
|                                         |           |                                        | Total foreign investment securities available-for-sale  |   |           | 605,124   |  |   |           | 605,652   | 
|                                         |           |                                        |                                                         |   |           |          
|                                         |           |                                        | Total investment securities available-for-sale          |   | $         | 6,083,252 |  |   | $         | 6,062,520 | 
|                                         |           |                                        |                                                         |   |           |          
|Investment Securities Held-to-Maturity   |           |                                        |                                                         |   |           |           |  |  
|                                         | Domestic: |                                        |                                                         |   |           |           |  |   |          
|                                         |           | Due within one year                    |                                                         | $ |          |           |  | $ |          |          
|                                         |           | Due after one year through five years  |                                                         |   |          |           |  |   |          |          
|                                         |           | Due after five years through ten years |                                                         |   | 649       |           |  |   | 649       |          
|                                         |           | Due after ten years                    |                                                         |   | 297,425   |           |  |   | 298,423   |          
|                                         |           |                                        |                                                         |   |           |          
|                                         |           |                                        | Total domestic investment securities held-to-maturity   |   |           | 298,074   |  |   |           | 299,072   | 
|                                         | Foreign:  |                                        |                                                         |   |           |           |  |   |          
|                                         |           | Due within one year                    |                                                         |   |          |           |  |   |          |          
|                                         |           | Due after one year through five years  |                                                         |   | 1,000     |           |  |   | 1,000     |          
|                                         |           |                                        |                                                         |   |           |          
|                                         |           |                                        | Total foreign investment securities held-to-maturity    |   |           | 1,000     |  |   |           | 1,000     | 
|                                         |           |                                        |                                                         |   |           |          
|                                         |           |                                        | Total investment securities held-to-maturity            |   | $         | 299,074   |  |   | $         | 300,072   | 
|                                         |           |                                        |                                                         |   |           |          
|                                        







---



##### 



SUMMARY OF INVESTMENT
SECURITIES (dollars in
thousands)


|                                          |           |                                                                  |                                                         |         |            |           |       |            |        |        |        |      |         |         |   |         |           |           | 
|----------------------------------------- | --------- | ---------------------------------------------------------------- | ------------------------------------------------------- | ------- | ---------- | --------- | ----- | ---------- | ------ | ------ | ------ | ---- | ------- | ------- | - | ------- | --------- | --------- | 
|                                          |           |                                                                  |                                                         | Gross   |            |           | Gross |            |        |       
|                                          |           | Amortized                                                        |                                                         |         | Unrealized |           |       | Unrealized |        |        | Market |     
|                                          |           | Cost                                                             |                                                         |         | Gains      |           |       | Losses     |        |        | Value  |     
|                                          |           |                                                                  |                                                         |         |            |           |       |            |       
|December 31, 2004                         |           |                                                                  |                                                         |         |            |           |       |            |        |        |        |      |         |         |   |        
|Investment securities available-for-sale: |           |                                                                  |                                                         |         |            |           |       |            |        |        |        |      |         |         |   |        
|                                          | Domestic: |                                                                  |                                                         |         |            |           |       |            |        |        |        |      |         |         |   |         |          
|                                          |           | U.S. Treasury and other U.S. government agencies
    obligations |                                                         | $       | 2,995,431  |           |       | $          | 1,565  |        |        | $    | (17,937 | )       |   | $       | 2,979,059 |          
|                                          |           | State and political subdivisions of the United States            |                                                         |         | 105,615    |           |       |            |       |        |        |      |        |         |   |         | 105,615   |          
|                                          |           | Asset-backed and other securities                                |                                                         |         | 2,377,082  |           |       |            | 2,673  |        |        |      | (7,561  | )       |   |         | 2,372,194 |          
|                                          |           |                                                                  |                                                         |         |            |           |       |            |        |        |        |     
|                                          |           |                                                                  | Total domestic investment securities available-for-sale |         |            | 5,478,128 |       |            |        | 4,238  |        |      |         | (25,498 | ) |         |           | 5,456,868 | 
|                                          | Foreign   |                                                                  |                                                         | 605,124 |            |           |       | 862        |        |        |        | (334 | )       |         |   | 605,652 |          
|                                          |           |                                                                  |                                                         |         |            |           |       |            |        |        |        |     
|                                          |           |                                                                  | Total investment securities available-for-sale          |         | $          | 6,083,252 |       |            | $      | 5,100  |        |      | $       | (25,832 | ) |         | $         | 6,062,520 | 
|                                          |           |                                                                  |                                                         |         |            |           |       |            |        |        |        |     
|Investment securities held-to-maturity:   |           |                                                                  |                                                         |         |            |           |       |            |        |        |        |      |         |         |   |        
|                                          | Domestic: |                                                                  |                                                         |         |            |           |       |            |        |        |        |      |         |         |   |         |          
|                                          |           | U.S. Treasury and other U.S. government agencies
    obligations |                                                         | $       | 275,755    |           |       | $          | 3,996  |        |        | $    | (2,675  | )       |   | $       | 277,076   |          
|                                          |           | State and political subdivisions of the United States            |                                                         |         | 6,655      |           |       |            | 165    |        |        |      |        |         |   |         | 6,820     |          
|                                          |           | Asset-backed and other securities                                |                                                         |         | 15,664     |           |       |            | 35     |        |        |      | (523    | )       |   |         | 15,176    |          
|                                          |           |                                                                  |                                                         |         |            |           |       |            |        |        |        |     
|                                          |           |                                                                  | Total domestic investment securities held-to-maturity   |         |            | 298,074   |       |            |        | 4,196  |        |      |         | (3,198  | ) |         |           | 299,072   | 
|                                          | Foreign   |                                                                  |                                                         | 1,000   |            |           |       |           |        |        |        |     |         |         |   | 1,000   |          
|                                          |           |                                                                  |                                                         |         |            |           |       |            |        |        |        |     
|                                          |           |                                                                  | Total investment securities held-to-maturity            |         | $          | 299,074   |       |            | $      | 4,196  |        |      | $       | (3,198  | ) |         | $         | 300,072   | 
|                                          |           |                                                                  |                                                         |         |            |           |       |            |        |        |        |     
|December 31, 2003                         |           |                                                                  |                                                         |         |            |           |       |            |        |        |        |      |         |         |   |        
|Investment securities available-for-sale: |           |                                                                  |                                                         |         |            |           |       |            |        |        |        |      |         |         |   |        
|                                          | Domestic: |                                                                  |                                                         |         |            |           |       |            |        |        |        |      |         |         |   |         |          
|                                          |           | U.S. Treasury and other U.S. government agencies
    obligations |                                                         | $       | 2,024,520  |           |       | $          | 7,362  |        |        | $    | (266    | )       |   | $       | 2,031,616 |          
|                                          |           | State and political subdivisions of the United States            |                                                         |         | 102,685    |           |       |            |       |        |        |      |        |         |   |         | 102,685   |          
|                                          |           | Asset-backed and other securities                                |                                                         |         | 1,796,824  |           |       |            | 4,365  |        |        |      | (156    | )       |   |         | 1,801,033 |          
|                                          |           |                                                                  |                                                         |         |            |           |       |            |        |        |        |     
|                                          |           |                                                                  | Total domestic investment securities available-for-sale |         |            | 3,924,029 |       |            |        | 11,727 |        |      |         | (422    | ) |         |           | 3,935,334 | 
|                                          | Foreign   |                                                                  |                                                         | 428,040 |            |           |       |           |        |        |        | (287 | )       |         |   | 427,753 |          
|                                          |           |                                                                  |                                                         |         |            |           |       |            |        |        |        |     
|                                          |           |                                                                  | Total investment securities available-for-sale          |         | $          | 4,352,069 |       |            | $      | 11,727 |        |      | $       | (709    | ) |         | $         | 4,363,087 | 
|                                          |           |                                                                  |                                                         |         |            |           |       |            |        |        |        |     
|Investment securities held-to-maturity:   |           |                                                                  |                                                         |         |            |           |       |            |        |        |        |      |         |         |   |        
|                                          | Domestic: |                                                                  |                                                         |         |            |           |       |            |        |        |        |      |         |         |   |         |          
|                                          |           | U.S. Treasury and other U.S. government agencies
    obligations |                                                         | $       | 335,445    |           |       | $          | 4,910  |        |        | $    | (3,773  | )       |   | $       | 336,582   |          
|                                          |           | State and political subdivisions of the United States            |                                                         |         | 7,615      |           |       |            | 171    |        |        |      |        |         |   |         | 7,786     |          
|                                          |           | Asset-backed and other securities                                |                                                         |         | 9,239      |           |       |            | 38     |        |        |      | (211    | )       |   |         | 9,066     |          
|                                          |           |                                                                  |                                                         |         |            |           |       |            |        |        |        |     
|                                          |           |                                                                  | Total domestic investment securities held-to-maturity   |         |            | 352,299   |       |            |        | 5,119  |        |      |         | (3,984  | ) |         |           | 353,434   | 
|                                          | Foreign   |                                                                  |                                                         | 1,000   |            |           |       |           |        |        |        |     |         |         |   | 1,000   |          
|                                          |           |                                                                  |                                                         |         |            |           |       |            |        |        |        |     
|                                          |           |                                                                  | Total investment securities held-to-maturity            |         | $          | 353,299   |       |            | $      | 5,119  |        |      | $       | (3,984  | ) |         | $         | 354,434   | 
|                                          |           |                                                                  |                                                         |         |            |           |       |            |        |        |        |     
|December 31, 2002                         |           |                                                                  |                                                         |         |            |           |       |            |        |        |        |      |         |         |   |        
|Investment securities available-for-sale: |           |                                                                  |                                                         |         |            |           |       |            |        |        |        |      |         |         |   |        
|                                          | Domestic: |                                                                  |                                                         |         |            |           |       |            |        |        |        |      |         |         |   |         |          
|                                          |           | U.S. Treasury and other U.S. government agencies
    obligations |                                                         | $       | 1,908,384  |           |       | $          | 26,850 |        |        | $    |        |         |   | $       | 1,935,234 |          
|                                          |           | State and political subdivisions of the United States            |                                                         |         | 101,370    |           |       |            |       |        |        |      |        |         |   |         | 101,370   |          
|                                          |           | Asset-backed and other securities                                |                                                         |         | 1,391,465  |           |       |            | 10,607 |        |        |      | (544    | )       |   |         | 1,401,528 |          
|                                          |           |                                                                  |                                                         |         |            |           |       |            |        |        |        |     
|                                          |           |                                                                  | Total domestic investment securities available-for-sale |         |            | 3,401,219 |       |            |        | 37,457 |        |      |         | (544    | ) |         |           | 3,438,132 | 
|                                          | Foreign   |                                                                  |                                                         | 216,286 |            |           |       | 1,390      |        |        |        |     |         |         |   | 217,676 |          
|                                          |           |                                                                  |                                                         |         |            |           |       |            |        |        |        |     
|                                          |           |                                                                  | Total investment securities available-for-sale          |         | $          | 3,617,505 |       |            | $      | 38,847 |        |      | $       | (544    | ) |         | $         | 3,655,808 | 
|                                          |           |                                                                  |                                                         |         |            |           |       |            |        |        |        |     
|Investment securities held-to-maturity:   |           |                                                                  |                                                         |         |            |           |       |            |        |        |        |      |         |         |   |        
|                                          | Domestic: |                                                                  |                                                         |         |            |           |       |            |        |        |        |      |         |         |   |         |          
|                                          |           | U.S. Treasury and other U.S. government agencies
    obligations |                                                         | $       | 400,724    |           |       | $          | 9,061  |        |        | $    | (504    | )       |   | $       | 409,281   |          
|                                          |           | State and political subdivisions of the United States            |                                                         |         | 7,289      |           |       |            | 189    |        |        |      |        |         |   |         | 7,478     |          
|                                          |           | Asset-backed and other securities                                |                                                         |         | 9,747      |           |       |            | 78     |        |        |      | (125    | )       |   |         | 9,700     |          
|                                          |           |                                                                  |                                                         |         |            |           |       |            |        |        |        |     
|                                          |           |                                                                  | Total domestic investment securities held-to-maturity   |         |            | 417,760   |       |            |        | 9,328  |        |      |         | (629    | ) |         |           | 426,459   | 
|                                          | Foreign   |                                                                  |                                                         | 2,000   |            |           |       | 13         |        |        |        |     |         |         |   | 2,013   |          
|                                          |           |                                                                  |                                                         |         |            |           |       |            |        |        |        |     
|                                          |           |                                                                  | Total investment securities held-to-maturity            |         | $          | 419,760   |       |            | $      | 9,341  |        |      | $       | (629    | ) |         | $         | 428,472   | 
|                                          |           |                                                                  |                                                         |         |            |           |       |            |        |        |        |     
|                                          |           |                                                                  |                                                         |         |            |           |       |            |        |        |        |     
|                                          |          



NOTE 9: OFF-BALANCE SHEET ASSET SECURITIZATION













---



##### 





ACCOUNTS RECEIVABLE FROM SECURITIZATION
 (dollars in thousands)
 December 31,
    2004
    
    2003Sale of new loan principal receivables (a)
    
    $
    2,767,607
    
    
    $
    2,191,335Accrued interest and fees on securitized loans
    
    
    1,945,331
    
    
    
    1,958,873Interest-only strip receivable
    
    
    1,292,765
    
    
    
    1,338,061Accrued servicing fees
    
    
    900,012
    
    
    
    777,623Cash reserve accounts
    
    
    720,702
    
    
    
    607,467Other subordinated retained interests
    
    
    593,037
    
    
    
    608,550Other
    
    
    224,395
    
    
    
    284,568Total accounts receivable from securitization
    
    $
    8,443,849
    
    
    $
    7,766,477  (a)
    
    Balance comprised of allocated principal collections and
    accumulated investor interest.













---



##### 



SUPPLEMENTAL CREDIT LOSS
INFORMATION (dollars in
thousands)


|                             |                        |                |                         |            |             |             |   |            |            |            |        |          |          |          |   |           |            |            |  
|---------------------------- | ---------------------- | -------------- | ----------------------- | ---------- | ----------- | ----------- | - | ---------- | ---------- | ---------- | ------ | -------- | -------- | -------- | - | --------- | ---------- | ---------- | -
|                             |                        | Average        |                         |            | Credit      |             |   |            |            | Net Credit |       
|                             |                        | Balance        |                         |            | Losses      |             |   | Recoveries |            |            | Losses |         
|                             |                        |                |                         |            |             |             |   |            |           
|Year Ended December 31, 2004 |                        |                |                         |            |             |             |   |            |            |            |        |          |          |          |   |          
|                             | Managed loans:         |                |                         |            |             |             |   |            |            |            |        |          |          |          |   |           |           
|                             |                        | Credit card    |                         | $          | 99,541,923  |             |   | $          | 4,926,583  |            |        | $        | (401,276 | )        |   | $         | 4,525,307  |           
|                             |                        | Other consumer |                         |            | 14,290,550  |             |   |            | 1,033,565  |            |        |          | (76,611  | )        |   |           | 956,954    |           
|                             |                        | Commercial     |                         |            | 4,263,565   |             |   |            | 124,023    |            |        |          | (6,084   | )        |   |           | 117,939    |           
|                             |                        |                |                         |            |             |             |   |            |            |            |        |         
|                             |                        |                | Total managed loans     |            |             | 118,096,038 |   |            |            | 6,084,171  |        |          |          | (483,971 | ) |           |            | 5,600,200  |  
|                             | Securitized loans:     |                |                         |            |             |             |   |            |            |            |        |          |          |          |   |           |           
|                             |                        | Credit card    |                         |            | (80,362,285 | )           |   |            | (4,105,003 | )          |        |          | 324,504  |          |   |           | (3,780,499 | )         
|                             |                        | Other consumer |                         |            | (5,670,127  | )           |   |            | (476,132   | )          |        |          | 32,611   |          |   |           | (443,521   | )         
|                             |                        | Commercial     |                         |            | (1,007,839  | )           |   |            | (53,488    | )          |        |          | 1,484    |          |   |           | (52,004    | )         
|                             |                        |                |                         |            |             |             |   |            |            |            |        |         
|                             |                        |                | Total securitized loans |            |             | (87,040,251 | ) |            |            | (4,634,623 | )      |          |          | 358,599  |   |           |            | (4,276,024 | )
|                             |                        |                |                         |            |             |             |   |            |            |            |        |         
|                             | Loan receivables       |                | $                       | 31,055,787 |             |             | $ | 1,449,548  |            |            | $      | (125,372 | )        |          | $ | 1,324,176 |           
|                             |                        |                |                         |            |             |             |   |            |            |            |        |         
|Year Ended December 31, 2003 |                        |                |                         |            |             |             |   |            |            |            |        |          |          |          |   |          
|                             | Managed loans (a):     |                |                         |            |             |             |   |            |            |            |        |          |          |          |   |           |           
|                             |                        | Credit card    |                         | $          | 94,219,609  |             |   | $          | 4,979,817  |            |        | $        | (357,597 | )        |   | $         | 4,622,220  |           
|                             |                        | Other consumer |                         |            | 13,884,977  |             |   |            | 1,122,013  |            |        |          | (72,537  | )        |   |           | 1,049,476  |           
|                             |                        | Commercial     |                         |            | 1,770,388   |             |   |            | 70,952     |            |        |          | (3,483   | )        |   |           | 67,469     |           
|                             |                        |                |                         |            |             |             |   |            |            |            |        |         
|                             |                        |                | Total managed loans     |            |             | 109,874,974 |   |            |            | 6,172,782  |        |          |          | (433,617 | ) |           |            | 5,739,165  |  
|                             | Securitized loans (a): |                |                         |            |             |             |   |            |            |            |        |          |          |          |   |           |           
|                             |                        | Credit card    |                         |            | (75,289,395 | )           |   |            | (4,120,971 | )          |        |          | 285,841  |          |   |           | (3,835,130 | )         
|                             |                        | Other consumer |                         |            | (5,682,404  | )           |   |            | (535,254   | )          |        |          | 30,699   |          |   |           | (504,555   | )         
|                             |                        | Commercial     |                         |            | (719,357    | )           |   |            | (36,771    | )          |        |          | 987      |          |   |           | (35,784    | )         
|                             |                        |                |                         |            |             |             |   |            |            |            |        |         
|                             |                        |                | Total securitized loans |            |             | (81,691,156 | ) |            |            | (4,692,996 | )      |          |          | 317,527  |   |           |            | (4,375,469 | )
|                             |                        |                |                         |            |             |             |   |            |            |            |        |         
|                             | Loan receivables       |                | $                       | 28,183,818 |             |             | $ | 1,479,786  |            |            | $      | (116,090 | )        |          | $ | 1,363,696 |           
|                             |                        |                |                         |            |             |             |   |            |            |            |        |         
|Year Ended December 31, 2002 |                        |                |                         |            |             |             |   |            |            |            |        |          |          |          |   |          
|                             | Managed loans (a):     |                |                         |            |             |             |   |            |            |            |        |          |          |          |   |           |           
|                             |                        | Credit card    |                         | $          | 85,109,283  |             |   | $          | 4,286,281  |            |        | $        | (279,554 | )        |   | $         | 4,006,727  |           
|                             |                        | Other consumer |                         |            | 13,513,664  |             |   |            | 993,551    |            |        |          | (53,238  | )        |   |           | 940,313    |           
|                             |                        | Commercial     |                         |            | 1,410,984   |             |   |            | 46,547     |            |        |          | (1,992   | )        |   |           | 44,555     |           
|                             |                        |                |                         |            |             |             |   |            |            |            |        |         
|                             |                        |                | Total managed loans     |            |             | 100,033,931 |   |            |            | 5,326,379  |        |          |          | (334,784 | ) |           |            | 4,991,595  |  
|                             | Securitized loans (a): |                |                         |            |             |             |   |            |            |            |        |          |          |          |   |           |           
|                             |                        | Credit card    |                         |            | (68,956,888 | )           |   |            | (3,586,891 | )          |        |          | 228,416  |          |   |           | (3,358,475 | )         
|                             |                        | Other consumer |                         |            | (5,703,851  | )           |   |            | (497,087   | )          |        |          | 22,965   |          |   |           | (474,122   | )         
|                             |                        | Commercial     |                         |            | (57,992     | )           |   |            | (2,833     | )          |        |          | 47       |          |   |           | (2,786     | )         
|                             |                        |                |                         |            |             |             |   |            |            |            |        |         
|                             |                        |                | Total securitized loans |            |             | (74,718,731 | ) |            |            | (4,086,811 | )      |          |          | 251,428  |   |           |            | (3,835,383 | )
|                             |                        |                |                         |            |             |             |   |            |            |            |        |         
|                             | Loan receivables       |                | $                       | 25,315,200 |             |             | $ | 1,239,568  |            |            | $      | (83,356  | )        |          | $ | 1,156,212 |           
|                             |                        |                |                         |            |             |             |   |            |            |            |        |         
|                             |                       
|                             |                        |                |                         |            |             |             |   |            |            |            |        |         



|    |  |                                                                                                                                                                                                                                                                                                                                                                                                               
|--- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) |  | The Corporation reclassified certain loan products to separately
    report its commercial loan products. Business card products were
    reclassified from credit card loans to commercial loans, and all
    other commercial loan products were reclassified from other
    consumer loans to commercial loans. For purposes of
    comparability, certain prior period amounts have been
    reclassified.

















---



##### 



SUPPLEMENTAL LOAN DELINQUENCY
INFORMATION (a) (dollars
in thousands)


|                      |                |                         |            |             |             |   |           |             |            |   |            |             |             |   |           |            |            |  
|--------------------- | -------------- | ----------------------- | ---------- | ----------- | ----------- | - | --------- | ----------- | ---------- | - | ---------- | ----------- | ----------- | - | --------- | ---------- | ---------- | -
|December 31,          |                | 2004                    |            |             | 2003        |  
|                      |               
|                      |                | Loans                   |            |             | Loans       |   |           | Loans       |            |   | Loans      |            
|                      |                | Outstanding             |            |             | Delinquent  |   |           | Outstanding |            |   | Delinquent |            
|                      |                |                         |           
|Managed Loans (b)     |                |                         |            |             |             |   |           |             |            |   |            |             |             |   |           |           
|                      | Credit card    |                         | $          | 101,878,677 |             |   | $         | 4,282,501   |            |   | $          | 102,451,922 |             |   | $         | 4,409,983  |           
|                      | Other consumer |                         |            | 14,769,409  |             |   |           | 634,833     |            |   |            | 13,701,215  |             |   |           | 735,139    |           
|                      | Commercial     |                         |            | 4,970,089   |             |   |           | 107,763     |            |   |            | 2,340,423   |             |   |           | 58,528     |           
|                      |                |                         |            |             |             |   |           |             |            |   |            |            
|                      |                | Total managed loans     |            |             | 121,618,175 |   |           |             | 5,025,097  |   |            |             | 118,493,560 |   |           |            | 5,203,650  |  
|Securitized Loans (b) |                |                         |            |             |             |   |           |             |            |   |            |             |             |   |           |           
|                      | Credit card    |                         |            | (81,187,617 | )           |   |           | (3,560,930  | )          |   |            | (78,189,847 | )           |   |           | (3,525,394 | )         
|                      | Other consumer |                         |            | (5,664,384  | )           |   |           | (315,531    | )          |   |            | (5,671,832  | )           |   |           | (351,655   | )         
|                      | Commercial     |                         |            | (1,007,324  | )           |   |           | (37,195     | )          |   |            | (1,007,804  | )           |   |           | (36,802    | )         
|                      |                |                         |            |             |             |   |           |             |            |   |            |            
|                      |                | Total securitized loans |            |             | (87,859,325 | ) |           |             | (3,913,656 | ) |            |             | (84,869,483 | ) |           |            | (3,913,851 | )
|                      |                |                         |            |             |             |   |           |             |            |   |            |            
|Loan receivables      |                | $                       | 33,758,850 |             |             | $ | 1,111,441 |             |            | $ | 33,624,077 |             |             | $ | 1,289,799 |           
|                      |                |                         |            |             |             |   |           |             |            |   |            |            
|                     



|    |  |                                                                                                                                                                                                                                                                                                                                                                                                               
|--- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) |  | Delinquent loans are accruing loans which are 30 days or
    more past due.                                                                                                                                                                                                                                                                                                                                   
|   
|(b) |  | The Corporation reclassified certain loan products to separately
    report its commercial loan products. Business card products were
    reclassified from credit card loans to commercial loans, and all
    other commercial loan products were reclassified from other
    consumer loans to commercial loans. For purposes of
    comparability, certain prior period amounts have been
    reclassified.









SECURITIZATION KEY ASSUMPTIONS AND
SENSITIVITIES (a) (dollars
in thousands)


|                                                |                                            |        |           |         |          |      |         |            |      |        |          |       |       |          |           |         |                |        |        |          |       |   |          |       |  |                |           |         |  |   |        |        |  |   |       |       | 
|----------------------------------------------- | ------------------------------------------ | ------ | --------- | ------- | -------- | ---- | ------- | ---------- | ---- | ------ | -------- | ----- | ----- | -------- | --------- | ------- | -------------- | ------ | ------ | -------- | ----- | - | -------- | ----- |  | -------------- | --------- | ------- |  | - | ------ | ------ |  | - | ----- | ----- | 
|Year Ended                                      |                                            |        |           |         |          |     
|December 31,                                    |                                            |        | 2004      |         |          | 2003 |         |            | 2002 |       
|                                                |                                           
|                                                |                                            | Credit |           |         | Other    |      |         |            |      | Credit |          |       | Other |          |           |         |                | Credit |        |          | Other |   |          |      
|                                                |                                            | Card   |           |         | Consumer |      |         | Commercial |      |        | Card (d) |       |       | Consumer |           |         | Commercial (d) |        |        | Card (d) |       |   | Consumer |       |  | Commercial (d) |          
|                                                |                                            |        |          
|Interest-only strip receivable                  |                                            | $      | 1,133,320 |         |          | $    | 155,863 |            |      | $      | 3,582    |       |       | $        | 1,246,656 |         |                | $      | 84,043 |          |       | $ | 7,362    |       |  | $              | 1,088,950 |         |  | $ | 38,518 |        |  | $ | 2,497 |      
|Weighted average life (in years)                |                                            |        | .31       |         |          |      | .90     |            |      |        | .17      |       |       |          | .33       |         |                |        | .89    |          |       |   | .17      |       |  |                | .34       |         |  |   | .87    |        |  |   | .16   |      
|Loan payment rate (weighted average rate)       |                                            |        | 15.66     | %       |          |      | 4.84    | %          |      |        | 32.43    | %     |       |          | 14.49     | %       |                |        | 4.92   | %        |       |   | 32.55    | %     |  |                | 14.27     | %       |  |   | 5.05   | %      |  |   | 37.88 | %    
|                                                | Impact on fair value of 20% adverse change |        | $         | 159,061 |          |      | $       | 23,551     |      |        | $        | 383   |       |          | $         | 175,404 |                |        | $      | 12,785   |       |   | $        | 780   |  |                | $         | 156,595 |  |   | $      | 5,835  |  |   | $     | 302   | 
|                                                | Impact on fair value of 40% adverse change |        |           | 273,059 |          |      |         | 40,624     |      |        |          | 720   |       |          |           | 305,720 |                |        |        | 21,980   |       |   |          | 1,478 |  |                |           | 267,495 |  |   |        | 10,081 |  |   |       | 524   | 
|Gross credit losses (b) (weighted average rate) |                                            |        | 4.88      | %       |          |      | 8.25    | %          |      |        | 5.13     | %     |       |          | 5.24      | %       |                |        | 9.64   | %        |       |   | 5.06     | %     |  |                | 5.43      | %       |  |   | 9.83   | %      |  |   | 4.19  | %    
|                                                | Impact on fair value of 20% adverse change |        | $         | 227,384 |          |      | $       | 71,908     |      |        | $        | 1,732 |       |          | $         | 250,815 |                |        | $      | 83,294   |       |   | $        | 1,704 |  |                | $         | 243,789 |  |   | $      | 38,518 |  |   | $     | 643   | 
|                                                | Impact on fair value of 40% adverse change |        |           | 454,767 |          |      |         | 143,817    |      |        |          | 3,463 |       |          |           | 501,630 |                |        |        | 84,043   |       |   |          | 3,409 |  |                |           | 487,579 |  |   |        | 38,518 |  |   |       | 1,286 | 
|Excess spread (c) (weighted average rate)       |                                            |        | 4.85      | %       |          |      | 3.58    | %          |      |        | 2.12     | %     |       |          | 5.20      | %       |                |        | 1.95   | %        |       |   | 4.37     | %     |  |                | 4.85      | %       |  |   | .91    | %      |  |   | 3.25  | %    
|                                                | Impact on fair value of 20% adverse change |        | $         | 226,664 |          |      | $       | 31,173     |      |        | $        | 716   |       |          | $         | 249,331 |                |        | $      | 16,809   |       |   | $        | 1,472 |  |                | $         | 217,790 |  |   | $      | 7,704  |  |   | $     | 499   | 
|                                                | Impact on fair value of 40% adverse change |        |           | 453,328 |          |      |         | 62,345     |      |        |          | 1,433 |       |          |           | 498,662 |                |        |        | 33,617   |       |   |          | 2,945 |  |                |           | 435,580 |  |   |        | 15,407 |  |   |       | 999   | 
|Discount rate (weighted average rate)           |                                            |        | 10.00     | %       |          |      | 10.00   | %          |      |        | 10.00    | %     |       |          | 9.00      | %       |                |        | 9.00   | %        |       |   | 9.00     | %     |  |                | 9.00      | %       |  |   | 9.00   | %      |  |   | 9.00  | %    
|                                                | Impact on fair value of 20% adverse change |        | $         | 5,264   |          |      | $       | 1,877      |      |        | $        | 10    |       |          | $         | 5,476   |                |        | $      | 902      |       |   | $        | 19    |  |                | $         | 4,864   |  |   | $      | 404    |  |   | $     | 6     | 
|                                                | Impact on fair value of 40% adverse change |        |           | 10,487  |          |      |         | 3,719      |      |        |          | 20    |       |          |           | 10,913  |                |        |        | 1,789    |       |   |          | 37    |  |                |           | 9,692   |  |   |        | 801    |  |   |       | 12    | 
|                                               



|    |  |                                                                                                                                                                                                                                                                                                                                                                                                               
|--- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) |  | The sensitivities do not reflect actions management might take
    to offset the impact of possible adverse changes if they were to
    occur.                                                                                                                                                                                                                                                                
|   
|(b) |  | Gross credit losses exclude the impact of recoveries; however,
    recoveries are included in the determination of the excess
    spread.                                                                                                                                                                                                                                                                     
|   
|(c) |  | Excess spread includes projections of interest income, certain
    fees, and charged-off loan recoveries, less gross credit losses,
    contractual servicing fees, and the interest rate paid to
    investors.                                                                                                                                                                                              
|   
|(d) |  | The Corporation reclassified certain loan products to separately
    report its commercial loan products. Business card products were
    reclassified from credit card loans to commercial loans, and all
    other commercial loan products were reclassified from other
    consumer loans to commercial loans. For purposes of
    comparability, certain prior period amounts have been
    reclassified.







---



##### 



SECURITIZATION CASH
FLOWS (dollars in
millions)


|                                                           |  |        |         |  |          |   |       |            |  |        |          |  |       |          |         |  |                |        |       |          |       |   |          |  |  |                |         |  |  |   |       |  |  |   |     | 
|---------------------------------------------------------- |  | ------ | ------- |  | -------- | - | ----- | ---------- |  | ------ | -------- |  | ----- | -------- | ------- |  | -------------- | ------ | ----- | -------- | ----- | - | -------- |  |  | -------------- | ------- |  |  | - | ----- |  |  | - | --- | 
|Year Ended December 31,                                    |  | 2004   |         |  | 2003     |   |       | 2002       | 
|                                                           | 
|                                                           |  | Credit |         |  | Other    |   |       |            |  | Credit |          |  | Other |          |         |  |                | Credit |       |          | Other |   |          | 
|                                                           |  | Card   |         |  | Consumer |   |       | Commercial |  |        | Card (a) |  |       | Consumer |         |  | Commercial (a) |        |       | Card (a) |       |   | Consumer |  |  | Commercial (a) |        
|                                                           |  |        |        
|Proceeds from new securitizations                          |  | $      | 12,207  |  |          | $ |      |            |  | $      |         |  |       | $        | 13,098  |  |                | $      |      |          |       | $ | 500      |  |  | $              | 14,873  |  |  | $ |      |  |  | $ | 500 | 
|Collections reinvested in revolving-period securitizations |  |        | 136,345 |  |          |   | 3,447 |            |  |        | 3,821    |  |       |          | 119,033 |  |                |        | 3,389 |          |       |   | 2,553    |  |  |                | 103,693 |  |  |   | 3,385 |  |  |   | 207 | 
|Contractual servicing fees received                        |  |        | 1,583   |  |          |   | 56    |            |  |        | 20       |  |       |          | 1,453   |  |                |        | 56    |          |       |   | 14       |  |  |                | 1,339   |  |  |   | 56    |  |  |   |    | 
|Cash flows received on retained interests                  |  |        | 6,339   |  |          |   | 260   |            |  |        | 96       |  |       |          | 5,842   |  |                |        | 242   |          |       |   | 60       |  |  |                | 5,518   |  |  |   | 260   |  |  |   |    | 
|                                                          



|    |  |                                                                                                                                                                                                                                                                                                                                                                                                               
|--- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) |  | The Corporation reclassified certain loan products to separately
    report its commercial loan products. Business card products were
    reclassified from credit card loans to commercial loans, and all
    other commercial loan products were reclassified from other
    consumer loans to commercial loans. For purposes of
    comparability, certain prior period amounts have been
    reclassified.



NOTE 10: GEOGRAPHICAL DIVERSIFICATION OF LOANS





GEOGRAPHIC DISTRIBUTION OF LOAN
RECEIVABLES, SECURITIZED LOANS, AND MANAGED
LOANS (dollars in thousands)


|                               |              |                  |            |           |                   |  |      |               |       |   |            |            |            |  |      |      |       |   |            |            |             |  |      |      |       |  
|------------------------------ | ------------ | ---------------- | ---------- | --------- | ----------------- |  | ---- | ------------- | ----- | - | ---------- | ---------- | ---------- |  | ---- | ---- | ----- | - | ---------- | ---------- | ----------- |  | ---- | ---- | ----- | -
|                               |              | Loan Receivables |            |           | Securitized Loans |  |      | Managed Loans |      
|                              
|December 31, 2004              |              |                  |            |           |                   |  |      |               |       |   |            |            |            |  |      |      |       |   |            |            |             |  |      |     
|United States:                 |              |                  |            |           |                   |  |      |               |       |   |            |            |            |  |      |      |       |   |            |            |             |  |      |     
|                               | Northern     |                  | $          | 2,726,677 |                   |  |      | 8.1           | %     |   | $          | 9,427,715  |            |  |      | 10.7 | %     |   | $          | 12,154,392 |             |  |      | 10.0 | %    
|                               | Mid-Atlantic |                  |            | 3,615,560 |                   |  |      | 10.7          |       |   |            | 12,179,123 |            |  |      | 13.9 |       |   |            | 15,794,683 |             |  |      | 13.0 |      
|                               | Southern     |                  |            | 4,550,301 |                   |  |      | 13.5          |       |   |            | 15,064,219 |            |  |      | 17.2 |       |   |            | 19,614,520 |             |  |      | 16.1 |      
|                               | Central      |                  |            | 3,887,569 |                   |  |      | 11.5          |       |   |            | 12,856,763 |            |  |      | 14.6 |       |   |            | 16,744,332 |             |  |      | 13.8 |      
|                               | Western      |                  |            | 4,119,511 |                   |  |      | 12.2          |       |   |            | 12,480,635 |            |  |      | 14.2 |       |   |            | 16,600,146 |             |  |      | 13.6 |      
|                               | Southwestern |                  |            | 3,391,974 |                   |  |      | 10.0          |       |   |            | 10,223,394 |            |  |      | 11.6 |       |   |            | 13,615,368 |             |  |      | 11.2 |      
|United Kingdom/ Ireland/ Spain |              |                  | 10,595,429 |           |                   |  | 31.4 |               |       |   | 11,863,419 |            |            |  | 13.5 |      |       |   | 22,458,848 |            |             |  | 18.5 |     
|Canada                         |              |                  | 669,571    |           |                   |  | 2.0  |               |       |   | 3,098,552  |            |            |  | 3.5  |      |       |   | 3,768,123  |            |             |  | 3.1  |     
|Other                          |              |                  | 202,258    |           |                   |  | .6   |               |       |   | 665,505    |            |            |  | .8   |      |       |   | 867,763    |            |             |  | .7   |     
|                               |              |                  |            |           |                   |  |      |               |       |   |            |            |            |  |      |      |       |  
|                               |              | Total            |            | $         | 33,758,850        |  |      |               | 100.0 | % |            | $          | 87,859,325 |  |      |      | 100.0 | % |            | $          | 121,618,175 |  |      |      | 100.0 | %
|                               |              |                  |            |           |                   |  |      |               |       |   |            |            |            |  |      |      |       |  
|December 31, 2003              |              |                  |            |           |                   |  |      |               |       |   |            |            |            |  |      |      |       |   |            |            |             |  |      |     
|United States:                 |              |                  |            |           |                   |  |      |               |       |   |            |            |            |  |      |      |       |   |            |            |             |  |      |     
|                               | Northern     |                  | $          | 2,978,085 |                   |  |      | 8.9           | %     |   | $          | 9,421,779  |            |  |      | 11.1 | %     |   | $          | 12,399,864 |             |  |      | 10.4 | %    
|                               | Mid-Atlantic |                  |            | 3,982,186 |                   |  |      | 11.8          |       |   |            | 12,471,359 |            |  |      | 14.7 |       |   |            | 16,453,545 |             |  |      | 13.9 |      
|                               | Southern     |                  |            | 4,907,262 |                   |  |      | 14.6          |       |   |            | 15,200,016 |            |  |      | 17.9 |       |   |            | 20,107,278 |             |  |      | 17.0 |      
|                               | Central      |                  |            | 4,158,939 |                   |  |      | 12.4          |       |   |            | 12,773,701 |            |  |      | 15.0 |       |   |            | 16,932,640 |             |  |      | 14.3 |      
|                               | Western      |                  |            | 4,282,156 |                   |  |      | 12.7          |       |   |            | 13,037,909 |            |  |      | 15.4 |       |   |            | 17,320,065 |             |  |      | 14.6 |      
|                               | Southwestern |                  |            | 3,503,874 |                   |  |      | 10.4          |       |   |            | 10,239,353 |            |  |      | 12.1 |       |   |            | 13,743,227 |             |  |      | 11.6 |      
|United Kingdom/ Ireland/ Spain |              |                  | 8,421,986  |           |                   |  | 25.0 |               |       |   | 8,738,274  |            |            |  | 10.3 |      |       |   | 17,160,260 |            |             |  | 14.5 |     
|Canada                         |              |                  | 799,987    |           |                   |  | 2.4  |               |       |   | 2,838,555  |            |            |  | 3.3  |      |       |   | 3,638,542  |            |             |  | 3.1  |     
|Other                          |              |                  | 589,602    |           |                   |  | 1.8  |               |       |   | 148,537    |            |            |  | .2   |      |       |   | 738,139    |            |             |  | .6   |     
|                               |              |                  |            |           |                   |  |      |               |       |   |            |            |            |  |      |      |       |  
|                               |              | Total            |            | $         | 33,624,077        |  |      |               | 100.0 | % |            | $          | 84,869,483 |  |      |      | 100.0 | % |            | $          | 118,493,560 |  |      |      | 100.0 | %
|                               |              |                  |            |           |                   |  |      |               |       |   |            |            |            |  |      |      |       |  
|                              









---



##### 





NOTE 11: RESERVE FOR POSSIBLE CREDIT LOSSES
  CHANGES IN THE RESERVE FOR POSSIBLE CREDIT
LOSSES (dollars in
thousands)
 December 31,
    2004
    
    2003
    
    2002Reserve for possible credit losses, beginning of year
    
    $
    1,216,316
    
    
    $
    1,111,299
    
    
    $
    833,423Reserves acquired
    
    
    83,071
    
    
    
    61,116
    
    
    
    84,878Provision for possible credit losses
    
    
    1,146,855
    
    
    
    1,392,701
    
    
    
    1,340,157Foreign currency translation
    
    
    14,492
    
    
    
    14,896
    
    
    
    9,053Credit losses
    
    
    (1,449,548
    )
    
    
    (1,479,786
    )
    
    
    (1,239,568
    )Recoveries
    
    
    125,372
    
    
    
    116,090
    
    
    
    83,356Net credit losses
    
    
    (1,324,176
    )
    
    
    (1,363,696
    )
    
    
    (1,156,212
    )Reserve for possible credit losses, end of year
    
    $
    1,136,558
    
    
    $
    1,216,316
    
    
    $
    1,111,299  NOTE 12: ACCRUING LOANS
PAST DUE 90 DAYS OR MORE (dollars in
thousands)
 December 31,
    2004
    
    2003Loan ReceivablesDomestic (a):Credit card
    
    $
    261,415
    
    
    $
    358,786Other consumer
    
    
    135,389
    
    
    
    163,701Commercial
    
    
    19,334
    
    
    
    7,496Total domestic
    
    
    416,138
    
    
    
    529,983Foreign (a):Credit card
    
    
    44,404
    
    
    
    41,669Other consumer
    
    
    9,270
    
    
    
    10,838Commercial
    
    
    10,590
    
    
    
    115Total foreign
    
    
    64,264
    
    
    
    52,622Total loan receivables
    
    $
    480,402
    
    
    $
    582,605 (a)
    
    The Corporation reclassified certain loan products to separately
    report its commercial loan products. Business card products were
    reclassified from credit card loans to commercial loans, and all
    other commercial loan products were reclassified from other
    consumer loans to commercial loans. For purposes of
    comparability, certain prior period amounts have been
    reclassified.




NOTE 13: NONACCRUAL
LOANS (dollars in thousands)
 December 31,
    2004
    
    2003Loan ReceivablesDomestic (a):Credit card
    
    $
    3,508
    
    
    $
    11,298Other consumer
    
    
    475
    
    
    
    1,053Commercial
    
    
    5,181
    
    
    
    1,816Total domestic
    
    
    9,164
    
    
    
    14,167Foreign (a):Credit card
    
    
    108,054
    
    
    
    80,352Other consumer
    
    
    60,071
    
    
    
    4,903Commercial
    
    
    254
    
    
    
    29Total foreign
    
    
    168,379
    
    
    
    85,284Total loan receivables
    
    $
    177,543
    
    
    $
    99,451Nonaccrual loan receivables as a percentage of ending loan
    receivables
    
    
    .53
    %
    
    
    .30
    % (a)
    
    The Corporation reclassified certain loan products to separately
    report its commercial loan products. Business card products were
    reclassified from credit card loans to commercial loans, and all
    other commercial loan products were reclassified from other
    consumer loans to commercial loans. For purposes of
    comparability, certain prior period amounts have been
    reclassified. NOTE 14: OTHER
RESTRUCTURED LOANS (a) (dollars in
thousands)
 December 31,
    2004
    
    2003Loan ReceivablesDomestic (b):Credit card
    
    $
    457,216
    
    
    $
    562,128Other consumer
    
    
    195,728
    
    
    
    229,175Commercial
    
    
    10,177
    
    
    
    3,627Total domestic
    
    
    663,121
    
    
    
    794,930Foreign (b):Credit card
    
    
    13,234
    
    
    
    34,653Other consumer
    
    
    5,560
    
    
    
    36,086Commercial
    
    
    
    
    
    
    Total foreign
    
    
    18,794
    
    
    
    70,739Total loan receivables
    
    $
    681,915
    
    
    $
    865,669Other restructured loan receivables as a percentage of ending
    loan receivables
    
    
    2.02
    %
    
    
    2.57
    % (a)
    
    During the fourth quarter of 2004, the Corporation changed its
    definition of other restructured loans to include all loans that
    have received a reduced rate or had been given other concessions
    in terms as a result of credit risk and are monitored by the
    Corporation on an ongoing basis. The Corporation previously
    excluded accounts that had been restructured more than one year
    ago, were performing according to the revised terms of the
    agreement, and were considered to have a market rate of
    interest. Prior period amounts have been reclassified for
    purposes of comparability.(b)
    
    The Corporation reclassified certain loan products to separately
    report its commercial loan products. Business card products were
    reclassified from credit card loans to commercial loans, and all
    other commercial loan products were reclassified from other
    consumer loans to commercial loans.








---



##### 



NOTE 15: PREMISES AND EQUIPMENT
  SUMMARY OF PREMISES AND EQUIPMENT
 (dollars in thousands)
 December 31,
    2004
    
    2003Land
    
    $
    244,800
    
    
    $
    207,479Buildings and improvements
    
    
    2,298,925
    
    
    
    2,159,226Furniture and equipment
    
    
    1,295,879
    
    
    
    1,285,063Software
    
    
    915,887
    
    
    
    733,279Total
    
    
    4,755,491
    
    
    
    4,385,047Accumulated depreciation
    
    
    (1,597,713
    )
    
    
    (1,436,507
    )Accumulated amortization on software
    
    
    (370,023
    )
    
    
    (271,943
    )Premises and equipment, net
    
    $
    2,787,755
    
    
    $
    2,676,597  NOTE 16:
    LEASE COMMITMENTS  FUTURE MINIMUM RENTAL PAYMENTS UNDER
 NONCANCELABLE OPERATING
LEASES (dollars in thousands)
 2005
    
    $
    30,4572006
    
    
    16,1522007
    
    
    5,8462008
    
    
    3,7352009
    
    
    1,880Thereafter
    
    
    1,680Total minimum lease payments
    
    $
    59,750  NOTE 17:
    DEPOSITS


MATURITIES OF
DEPOSITS (dollars in
thousands)
 Direct
    
    Other
    
    TotalDecember 31,
      2004
    Deposits
    
    Deposits (a)
    
    DepositsDomestic:One year or less
    
    $
    17,532,335
    
    
    $
    1,966,962
    
    
    $
    19,499,297Over one year through two years
    
    
    3,373,142
    
    
    
    1,030,174
    
    
    
    4,403,316Over two years through three years
    
    
    2,259,037
    
    
    
    779,225
    
    
    
    3,038,262Over three years through four years
    
    
    946,164
    
    
    
    120,933
    
    
    
    1,067,097Over four years through five years
    
    
    1,658,944
    
    
    
    
    
    
    
    1,658,944Over five years
    
    
    9,485
    
    
    
    
    
    
    
    9,485Total domestic deposits
    
    
    25,779,107
    
    
    
    3,897,294
    
    
    
    29,676,401Foreign:One year or less
    
    
    1,244,762
    
    
    
    160,407
    
    
    
    1,405,169Over one year through two years
    
    
    31,701
    
    
    
    
    
    
    
    31,701Over two years through three years
    
    
    58,288
    
    
    
    
    
    
    
    58,288Over three years through four years
    
    
    15,938
    
    
    
    
    
    
    
    15,938Over four years through five years
    
    
    52,007
    
    
    
    
    
    
    
    52,007Over five years
    
    
    
    
    
    
    
    
    
    
    Total foreign deposits
    
    
    1,402,696
    
    
    
    160,407
    
    
    
    1,563,103Total deposits
    
    $
    27,181,803
    
    
    $
    4,057,701
    
    
    $
    31,239,504  (a)
    
    At December 31, 2004, all other deposits were brokered
    deposits. NOTE 18: SHORT-TERM BORROWINGS








---



##### 





SUMMARY OF SHORT-TERM BORROWINGS
 (dollars in thousands)
 Year Ended December 31,
    2004
    
    2003
    
    2002Federal Funds Purchased and Securities Sold Under Repurchase
    AgreementsBalance at year end
    
    $
    
    
    
    $
    
    
    
    $
    Weighted average interest rate at year end
    
    
    
    %
    
    
    
    %
    
    
    
    %Average balance outstanding during the year
    
    $
    328
    
    
    $
    
    
    
    $
    1,502Maximum amount outstanding at any month end
    
    
    
    
    
    
    
    
    
    
    Weighted average interest rate during the year
    
    
    1.01
    %
    
    
    
    %
    
    
    1.80
    %Other Short-Term BorrowingsBalance at year end
    
    $
    2,104,414
    
    
    $
    1,025,463
    
    
    $
    1,250,103Weighted average interest rate at year end
    
    
    4.13
    %
    
    
    3.75
    %
    
    
    3.31
    %Average balance outstanding during the year
    
    $
    1,922,736
    
    
    $
    1,141,954
    
    
    $
    1,251,619Maximum amount outstanding at any month end
    
    
    2,270,226
    
    
    
    1,246,872
    
    
    
    1,340,653Weighted average interest rate during the year
    
    
    4.00
    %
    
    
    3.43
    %
    
    
    3.43
    %




NOTE 19: LONG-TERM DEBT AND BANK NOTES
     6.875% SENIOR NOTES
  SENIOR MEDIUM-TERM NOTES


SUMMARY OF LONG-TERM DEBT AND BANK
NOTES (dollars in thousands)


|                                                                                                                                                                                               |                               |      |           |            |      |   |           |            | 
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------------------- | ---- | --------- | ---------- | ---- | - | --------- | ---------- | 
|December 31,                                                                                                                                                                                   |                               | 2004 |           |            | 2003 |  
|                                                                                                                                                                                               |                              
|Parent Company                                                                                                                                                                                 |                               |      |           |            |      |   |           |           
|6.875% Senior Notes, maturing in 2005                                                                                                                                                          |                               | $    | 99,944    |            |      | $ | 99,856    |           
|Fixed-Rate Senior Medium-Term Notes, with a weighted average
    interest rate of 6.05% and 6.06%, respectively, maturing in
    varying amounts from 2007 through 2015                        |                               |      | 2,276,065 |            |      |   | 2,324,231 |           
|Floating-Rate Senior Medium-Term Notes, matured in varying
    amounts in 2004                                                                                                                 |                               |      |          |            |      |   | 94,968    |           
|Junior Subordinated Deferrable Interest Debentures,
    series A, with an interest rate of 8.278% maturing in 2026                                                                             |                               |      | 281,379   |            |      |   | 287,576   |           
|Junior Subordinated Deferrable Interest Debentures,
    series B, with an interest rate equal to 80 basis
    points above the three-month London Interbank Offered Rate,
    maturing in 2027 |                               |      | 286,222   |            |      |   | 286,112   |           
|Junior Subordinated Deferrable Interest Debentures,
    series C, with an interest rate of 8.25% maturing in 2027                                                                              |                               |      | 36,225    |            |      |   | 35,764    |           
|Junior Subordinated Deferrable Interest Debentures,
    series D, with an interest rate of 8.125% maturing in 2032                                                                             |                               |      | 318,110   |            |      |   | 320,362   |           
|Junior Subordinated Deferrable Interest Debentures,
    series E, with an interest rate of 8.10% maturing in 2033                                                                              |                               |      | 205,167   |            |      |   | 204,810   |           
|                                                                                                                                                                                               |                               |      |           |            |      |  
|                                                                                                                                                                                               | Total parent company          |      |           | 3,503,112  |      |   |           | 3,653,679  | 
|                                                                                                                                                                                              
|Subsidiaries                                                                                                                                                                                   |                               |      |           |            |      |   |           |           
|Fixed-Rate Bank Notes, with a weighted average interest rate of
    6.17% and 6.65%, respectively, maturing in varying amounts from
    2005 through 2009                                      |                               |      | 2,258,717 |            |      |   | 2,078,640 |           
|Floating-Rate Bank Notes, maturing in varying amounts in 2005                                                                                                                                  |                               |      | 34,992    |            |      |   | 154,928   |           
|Fixed-Rate Medium-Term Deposit Notes, with a weighted average
    interest rate of 5.32% and 5.29%, respectively, maturing in
    varying amounts from 2005 through 2008                       |                               |      | 559,307   |            |      |   | 612,466   |           
|Floating-Rate Medium-Term Deposit Notes, maturing in varying
    amounts from 2005 through 2006                                                                                                |                               |      | 117,298   |            |      |   | 217,068   |           
|Fixed-Rate Euro Medium-Term Notes, with a weighted average
    interest rate of 5.63% and 5.58%, respectively, maturing in
    varying amounts from 2007 through 2010                          |                               |      | 1,898,530 |            |      |   | 3,022,266 |           
|Floating-Rate Euro Medium-Term Notes, maturing in varying
    amounts from 2005 through 2008                                                                                                   |                               |      | 1,105,217 |            |      |   | 1,099,537 |           
|Floating-Rate Loan Notes, maturing in 2011                                                                                                                                                     |                               |      | 24,650    |            |      |   |          |           
|Fixed-Rate Asset-Backed Notes, with a weighted average interest
    rate of 5.27%, maturing in varying amounts from 2011 through
    2018 (a)                                                  |                               |      | 511,267   |            |      |   |          |           
|Floating-Rate Asset-Backed Notes, maturing in 2012 (a)                                                                                                                                         |                               |      | 110,727   |            |      |   |          |           
|6.75% Subordinated Notes, maturing in 2008                                                                                                                                                     |                               |      | 265,946   |            |      |   | 274,479   |           
|6.625% Subordinated Notes, maturing in 2012                                                                                                                                                    |                               |      | 531,641   |            |      |   | 533,739   |           
|7.125% Subordinated Notes, maturing in 2012                                                                                                                                                    |                               |      | 501,496   |            |      |   | 498,826   |           
|                                                                                                                                                                                               |                               |      |           |            |      |  
|                                                                                                                                                                                               | Long-term debt and bank notes |      | $         | 11,422,900 |      |   | $         | 12,145,628 | 
|                                                                                                                                                                                               |                               |      |           |            |      |  
|                                                                                                                                                                                              



|    |                                                                 
|--- | ----------------------------------------------------------------
|(a) | Asset-backed notes are included at their contractual maturities.







---



##### 



JUNIOR SUBORDINATED DEFERRABLE INTEREST DEBENTURES


BANK NOTES
  MEDIUM-TERM DEPOSIT NOTES
  EURO MEDIUM-TERM NOTES
  
 








---



##### 



LOAN NOTES
     ASSET-BACKED NOTES
    6.75% SUBORDINATED NOTES


6.625% SUBORDINATED NOTES
  7.125% SUBORDINATED NOTES
  MINIMUM ANNUAL MATURITIES OF LONG-TERM DEBT AND BANK
NOTES (a) (dollars
in thousands)
 MBNA Corporation(Par Value)
    
    Parent Company
    
    and Subsidiaries2005
    
    $
    100,000
    
    
    $
    1,558,8262006
    
    
    
    
    
    
    826,0952007
    
    
    700,000
    
    
    
    1,545,1272008
    
    
    250,000
    
    
    
    1,705,1252009
    
    
    
    
    
    
    1,181,050  (a)
    
    Asset-backed notes are included at their estimated maturity
    dates. NOTE 20: STOCKHOLDERS EQUITY
 PREFERRED STOCK
 1 2








---



##### 



PREFERRED STOCK DIVIDEND SUMMARY


|                 |  |                    |  |                  |  |          |      |   |                 |   |        |          |  |  |                 |   |  |   |        | 
|---------------- |  | ------------------ |  | ---------------- |  | -------- | ---- | - | --------------- | - | ------ | -------- |  |  | --------------- | - |  | - | ------ | 
|                 |  |                    |  |                  |  | Series A |      |   | Series B        |  
|                 | 
|                 |  | To Stockholders of |  |                  |  | Dividend |      |   | Dividend per    |   |        | Dividend |  |  | Dividend per    |  
|Declaration Date |  | Record as of       |  | Payment Date     |  | Rate     |      |   | Preferred Share |   |        | Rate     |  |  | Preferred Share |  
|                 | 
|January 20, 2005 |  | March 31, 2005     |  | April 15, 2005   |  |          | 7.50 | % |                 | $ | .46875 |          |  |  | 5.50            | % |  | $ | .34380 | 
|October 21, 2004 |  | December 31, 2004  |  | January 15, 2005 |  |          | 7.50 |   |                 |   | .46875 |          |  |  | 5.50            |   |  |   | .34380 | 
|July 22, 2004    |  | September 30, 2004 |  | October 15, 2004 |  |          | 7.50 |   |                 |   | .46875 |          |  |  | 5.50            |   |  |   | .34380 | 
|April 22, 2004   |  | June 30, 2004      |  | July 15, 2004    |  |          | 7.50 |   |                 |   | .46875 |          |  |  | 5.50            |   |  |   | .34380 | 
|January 22, 2004 |  | March 31, 2004     |  | April 15, 2004   |  |          | 7.50 |   |                 |   | .46875 |          |  |  | 5.50            |   |  |   | .34380 | 
|October 16, 2003 |  | December 31, 2003  |  | January 15, 2004 |  |          | 7.50 |   |                 |   | .46875 |          |  |  | 5.50            |   |  |   | .34380 | 
|July 24, 2003    |  | September 30, 2003 |  | October 15, 2003 |  |          | 7.50 |   |                 |   | .46875 |          |  |  | 5.50            |   |  |   | .34380 | 
|April 23, 2003   |  | June 30, 2003      |  | July 15, 2003    |  |          | 7.50 |   |                 |   | .46875 |          |  |  | 5.50            |   |  |   | .34380 | 
|January 23, 2003 |  | March 31, 2003     |  | April 15, 2003   |  |          | 7.50 |   |                 |   | .46875 |          |  |  | 5.50            |   |  |   | .34380 | 
|October 17, 2002 |  | December 31, 2002  |  | January 15, 2003 |  |          | 7.50 |   |                 |   | .46875 |          |  |  | 5.50            |   |  |   | .34380 | 
|July 11, 2002    |  | September 30, 2002 |  | October 15, 2002 |  |          | 7.50 |   |                 |   | .46875 |          |  |  | 5.56            |   |  |   | .34740 | 
|April 11, 2002   |  | June 28, 2002      |  | July 15, 2002    |  |          | 7.50 |   |                 |   | .46875 |          |  |  | 5.90            |   |  |   | .36850 | 
|January 10, 2002 |  | March 29, 2002     |  | April 15, 2002   |  |          | 7.50 |   |                 |   | .46875 |          |  |  | 5.50            |   |  |   | .34380 | 
|                



COMMON STOCK


NOTE 21: COMPREHENSIVE INCOME


COMMON STOCK DIVIDEND SUMMARY


|                 |  |                    |  |                 |  |              |     | 
|---------------- |  | ------------------ |  | --------------- |  | ------------ | --- | 
|                 | 
|                 |  | To Stockholders of |  |                 |  | Dividend per |    
|Declaration Date |  | Record as of       |  | Payment Date    |  | Common Share |    
|                 | 
|January 20, 2005 |  | March 15, 2005     |  | April 1, 2005   |  | $            | .14 | 
|October 21, 2004 |  | December 15, 2004  |  | January 1, 2005 |  |              | .12 | 
|July 22, 2004    |  | September 15, 2004 |  | October 1, 2004 |  |              | .12 | 
|April 22, 2004   |  | June 14, 2004      |  | July 1, 2004    |  |              | .12 | 
|January 22, 2004 |  | March 15, 2004     |  | April 1, 2004   |  |              | .12 | 
|October 16, 2003 |  | December 15, 2003  |  | January 1, 2004 |  |              | .10 | 
|July 24, 2003    |  | September 15, 2003 |  | October 1, 2003 |  |              | .10 | 
|April 23, 2003   |  | June 13, 2003      |  | July 1, 2003    |  |              | .08 | 
|January 23, 2003 |  | March 15, 2003     |  | April 1, 2003   |  |              | .08 | 
|October 17, 2002 |  | December 13, 2002  |  | January 1, 2003 |  |              | .07 | 
|July 16, 2002    |  | September 16, 2002 |  | October 1, 2002 |  |              | .07 | 
|April 11, 2002   |  | June 14, 2002      |  | July 1, 2002    |  |              | .07 | 
|January 10, 2002 |  | March 15, 2002     |  | April 1, 2002   |  |              | .07 | 
|                









---



##### 



OTHER COMPREHENSIVE INCOME
COMPONENTS (dollars in
thousands)


|                                                                                  |                            |      |         |         |      |   |         |         |  |   |         |         | 
|--------------------------------------------------------------------------------- | -------------------------- | ---- | ------- | ------- | ---- | - | ------- | ------- |  | - | ------- | ------- | 
|Year Ended December 31,                                                           |                            | 2004 |         |         | 2003 |   |         | 2002    | 
|                                                                                  |                           
|Foreign currency translation                                                      |                            | $    | 263,019 |         |      | $ | 352,800 |         |  | $ | 140,757 |        
|Net unrealized losses on investment securities
    available-for-sale, net of tax |                            |      | (20,462 | )       |      |   | (17,284 | )       |  |   | (3,322  | )      
|Minimum benefit plan liability adjustment, net of tax                             |                            |      | 11,515  |         |      |   | (10,938 | )       |  |   | (4,276  | )      
|                                                                                  |                            |      |         |         |      |   |         |         | 
|                                                                                  | Other comprehensive income |      | $       | 254,072 |      |   | $       | 324,578 |  |   | $       | 133,159 | 
|                                                                                  |                            |      |         |         |      |   |         |         | 
|                                                                                 



NOTE 22: EARNINGS PER COMMON SHARE


NOTE 23: INCOME TAXES
  RECONCILIATION OF FEDERAL STATUTORY INCOME
TAXES (dollars in
thousands)
 Year Ended December 31,
    
    2004
    
    2003
    
    2002Income before income taxes
    
    $
    4,131,629
    
    
    $
    3,659,005
    
    
    $
    2,785,416Statutory tax rate
    
    
    35
    %
    
    
    35
    %
    
    
    35
    %Income tax at statutory tax rate
    
    
    1,446,070
    
    
    
    1,280,652
    
    
    
    974,896State taxes, net of federal benefit
    
    
    40,195
    
    
    
    31,321
    
    
    
    23,951Tax credits
    
    
    (49,240
    )
    
    
    (41,105
    )
    
    
    (31,801
    )Other
    
    
    17,308
    
    
    
    50,033
    
    
    
    52,416Total income taxes
    
    $
    1,454,333
    
    
    $
    1,320,901
    
    
    $
    1,019,462


COMPUTATION OF EARNINGS PER COMMON
SHARE (dollars in
thousands, except per share amounts)


|                                                                                  |  |      |           |  |      |   |           |      |  |   |           | 
|--------------------------------------------------------------------------------- |  | ---- | --------- |  | ---- | - | --------- | ---- |  | - | --------- | 
|Year Ended December 31,                                                           |  | 2004 |           |  | 2003 |   |           | 2002 | 
|                                                                                  | 
|Earnings per Common Share                                                         |  |      |           |  |      |   |           |      |  |   |           | 
|Net income                                                                        |  | $    | 2,677,296 |  |      | $ | 2,338,104 |      |  | $ | 1,765,954 | 
|Less: preferred stock dividend requirements                                       |  |      | 14,064    |  |      |   | 14,064    |      |  |   | 14,178    | 
|                                                                                  |  |      |           |  |      |   |           |      | 
|Net income applicable to common stock                                             |  | $    | 2,663,232 |  |      | $ | 2,324,040 |      |  | $ | 1,751,776 | 
|                                                                                  |  |      |           |  |      |   |           |      | 
|Weighted average common shares outstanding (000)                                  |  |      | 1,277,833 |  |      |   | 1,278,166 |      |  |   | 1,277,787 | 
|                                                                                  |  |      |           |  |      |   |           |      | 
|Earnings per common share                                                         |  | $    | 2.08      |  |      | $ | 1.82      |      |  | $ | 1.37      | 
|                                                                                  |  |      |           |  |      |   |           |      | 
|Earnings per Common Share Assuming Dilution                                      |  |      |           |  |      |   |           |      |  |   |           | 
|Net income                                                                        |  | $    | 2,677,296 |  |      | $ | 2,338,104 |      |  | $ | 1,765,954 | 
|Less: preferred stock dividend requirements                                       |  |      | 14,064    |  |      |   | 14,064    |      |  |   | 14,178    | 
|                                                                                  |  |      |           |  |      |   |           |      | 
|Net income applicable to common stock                                             |  | $    | 2,663,232 |  |      | $ | 2,324,040 |      |  | $ | 1,751,776 | 
|                                                                                  |  |      |           |  |      |   |           |      | 
|Weighted average common shares outstanding (000)                                  |  |      | 1,277,833 |  |      |   | 1,278,166 |      |  |   | 1,277,787 | 
|Net effect of dilutive stock options (000)                                        |  |      | 19,345    |  |      |   | 16,976    |      |  |   | 24,925    | 
|                                                                                  |  |      |           |  |      |   |           |      | 
|Weighted average common shares outstanding and common stock
    equivalents (000) |  |      | 1,297,178 |  |      |   | 1,295,142 |      |  |   | 1,302,712 | 
|                                                                                  |  |      |           |  |      |   |           |      | 
|Earnings per common shareassuming dilution                                       |  | $    | 2.05      |  |      | $ | 1.79      |      |  | $ | 1.34      | 
|                                                                                  |  |      |           |  |      |   |           |      | 
|                                                                                 







---



##### 



COMPONENTS OF INCOME TAX EXPENSE
 (dollars in thousands)
 Year Ended December 31,
    2004
    
    2003
    
    2002Current Income TaxesU.S. federal
    
    $
    1,126,392
    
    
    $
    1,095,826
    
    
    $
    1,017,511U.S. state and
    local
    
    
    60,175
    
    
    
    48,186
    
    
    
    36,848Foreign
    
    
    157,218
    
    
    
    178,869
    
    
    
    116,810Total current income taxes
    
    
    1,343,785
    
    
    
    1,322,881
    
    
    
    1,171,169Deferred Income TaxesU.S. federal, state, and local
    
    
    100,521
    
    
    
    (669
    )
    
    
    (143,601
    )Foreign
    
    
    10,027
    
    
    
    (1,311
    )
    
    
    (8,106
    )Total deferred income taxes
    
    
    110,548
    
    
    
    (1,980
    )
    
    
    (151,707
    )Total income taxes
    
    $
    1,454,333
    
    
    $
    1,320,901
    
    
    $
    1,019,462


SUMMARY OF DEFERRED
TAXES (dollars in
thousands)
 December 31,
    2004
    
    2003Deferred Tax AssetsReserve for possible credit losses and the estimate of
    uncollectible accrued interest and fees
    
    $
    197,506
    
    
    $
    292,235Customer incentive programs
    
    
    120,289
    
    
    
    90,357Intangible assets
    
    
    267,641
    
    
    
    226,754Foreign tax loss carryforwards and tax credits
    
    
    8,279
    
    
    
    4,142Other deferred tax assets
    
    
    352,199
    
    
    
    341,654Total deferred tax assets
    
    
    945,914
    
    
    
    955,142Valuation allowance
    
    
    (8,279
    )
    
    
    (4,142
    )Total deferred tax assets less valuation allowance
    
    
    937,635
    
    
    
    951,000Deferred Tax LiabilitiesSecuritizations and related items
    
    
    (372,537
    )
    
    
    (380,350
    )Software
    
    
    (157,476
    )
    
    
    (118,368
    )Deferred fee income
    
    
    (127,088
    )
    
    
    (50,162
    )Other deferred tax liabilities
    
    
    (95,394
    )
    
    
    (79,090
    )Total deferred tax liabilities
    
    
    (752,495
    )
    
    
    (627,970
    )Net deferred tax assets
    
    $
    185,140
    
    
    $
    323,030 NOTE 24: EMPLOYEE BENEFITS
  PENSION PLAN








---



##### 



BENEFIT PLAN FINANCIAL
INFORMATION (dollars in
thousands)


|                                                                               |                                               |              |          |         |      |   |          |        |   |   |          |         |   |      |          |        |      |   |          |         |   |   |          |        |  
|------------------------------------------------------------------------------ | --------------------------------------------- | ------------ | -------- | ------- | ---- | - | -------- | ------ | - | - | -------- | ------- | - | ---- | -------- | ------ | ---- | - | -------- | ------- | - | - | -------- | ------ | -
|                                                                               |                                               | Pension Plan |          |         | SERP |   |          | Total  |  
|                                                                               |                                              
|Year Ended December 31,                                                        |                                               | 2004         |          |         | 2003 |   |          | 2004   |   |   | 2003     |         |   | 2004 |          |        | 2003 |  
|                                                                               |                                               |              |         
|Change in Benefit Obligation                                                   |                                               |              |          |         |      |   |          |        |   |   |          |         |   |      |          |        |      |   |          |         |   |   |          |       
|Net benefit obligation, beginning of year                                      |                                               | $            | 517,846  |         |      | $ | 397,182  |        |   | $ | 227,595  |         |   | $    | 176,580  |        |      | $ | 745,441  |         |   | $ | 573,762  |       
|                                                                               | Service cost-benefits earned during the year  |              |          | 60,225  |      |   |          | 49,775 |   |   |          | 14,674  |   |      |          | 15,090 |      |   |          | 74,899  |   |   |          | 64,865 |  
|                                                                               | Interest cost on projected benefit obligation |              |          | 34,511  |      |   |          | 28,899 |   |   |          | 13,732  |   |      |          | 12,964 |      |   |          | 48,243  |   |   |          | 41,863 |  
|                                                                               | Actuarial (gain) loss                         |              |          | (13,427 | )    |   |          | 45,551 |   |   |          | (15,108 | ) |      |          | 17,483 |      |   |          | (28,535 | ) |   |          | 63,034 |  
|                                                                               | Plan amendments                               |              |          |        |      |   |          |       |   |   |          | (160    | ) |      |          | 7,218  |      |   |          | (160    | ) |   |          | 7,218  |  
|                                                                               | Gross benefits paid                           |              |          | (3,880  | )    |   |          | (3,561 | ) |   |          | (3,184  | ) |      |          | (1,740 | )    |   |          | (7,064  | ) |   |          | (5,301 | )
|                                                                               | Special termination benefits                  |              |          |        |      |   |          |       |   |   |          | 2,210   |   |      |          |       |      |   |          | 2,210   |   |   |          |       |  
|                                                                               |                                               |              |          |         |      |   |          |        |   |   |          |         |   |      |          |        |      |  
|Net benefit obligation, end of year                                            |                                               | $            | 595,275  |         |      | $ | 517,846  |        |   | $ | 239,759  |         |   | $    | 227,595  |        |      | $ | 835,034  |         |   | $ | 745,441  |       
|                                                                               |                                               |              |          |         |      |   |          |        |   |   |          |         |   |      |          |        |      |  
|Change in Plan Assets                                                          |                                               |              |          |         |      |   |          |        |   |   |          |         |   |      |          |        |      |   |          |         |   |   |          |       
|Fair value of plan assets, beginning of year                                   |                                               | $            | 378,407  |         |      | $ | 263,336  |        |   | $ |         |         |   | $    |         |        |      | $ | 378,407  |         |   | $ | 263,336  |       
|                                                                               | Actual return on plan assets                  |              |          | 37,859  |      |   |          | 49,632 |   |   |          |        |   |      |          |       |      |   |          | 37,859  |   |   |          | 49,632 |  
|                                                                               | Employer contributions                        |              |          | 68,959  |      |   |          | 69,000 |   |   |          | 3,184   |   |      |          | 1,740  |      |   |          | 72,143  |   |   |          | 70,740 |  
|                                                                               | Gross benefits paid                           |              |          | (3,880  | )    |   |          | (3,561 | ) |   |          | (3,184  | ) |      |          | (1,740 | )    |   |          | (7,064  | ) |   |          | (5,301 | )
|                                                                               |                                               |              |          |         |      |   |          |        |   |   |          |         |   |      |          |        |      |  
|Fair value of plan assets, end of year                                         |                                               | $            | 481,345  |         |      | $ | 378,407  |        |   | $ |         |         |   | $    |         |        |      | $ | 481,345  |         |   | $ | 378,407  |       
|                                                                               |                                               |              |          |         |      |   |          |        |   |   |          |         |   |      |          |        |      |  
|Funded status                                                                  |                                               | $            | (113,930 | )       |      | $ | (139,439 | )      |   | $ | (239,759 | )       |   | $    | (227,595 | )      |      | $ | (353,689 | )       |   | $ | (367,034 | )     
|Unrecognized net actuarial loss                                                |                                               |              | 171,098  |         |      |   | 196,528  |        |   |   | 26,705   |         |   |      | 43,224   |        |      |   | 197,803  |         |   |   | 239,752  |       
|Unrecognized prior service cost                                                |                                               |              | 11,315   |         |      |   | 12,400   |        |   |   | 41,120   |         |   |      | 44,399   |        |      |   | 52,435   |         |   |   | 56,799   |       
|Unrecognized net transition obligation                                         |                                               |              |         |         |      |   |         |        |   |   | 1,279    |         |   |      | 1,694    |        |      |   | 1,279    |         |   |   | 1,694    |       
|Fourth quarter contributions                                                   |                                               |              |         |         |      |   |         |        |   |   | 1,205    |         |   |      |         |        |      |   | 1,205    |         |   |   |         |       
|                                                                               |                                               |              |          |         |      |   |          |        |   |   |          |         |   |      |          |        |      |  
|Net amount recognized                                                          |                                               | $            | 68,483   |         |      | $ | 69,489   |        |   | $ | (169,450 | )       |   | $    | (138,278 | )      |      | $ | (100,967 | )       |   | $ | (68,789  | )     
|                                                                               |                                               |              |          |         |      |   |          |        |   |   |          |         |   |      |          |        |      |  
|Amounts Recognized in the Consolidated Statements of
    Financial Condition   |                                               |              |          |         |      |   |          |        |   |   |          |         |   |      |          |        |      |   |          |         |   |   |          |       
|Prepaid benefit cost                                                           |                                               | $            | 68,483   |         |      | $ | 69,489   |        |   | $ |         |         |   | $    |         |        |      | $ | 68,483   |         |   | $ | 69,489   |       
|Accrued benefit cost                                                           |                                               |              |         |         |      |   |         |        |   |   | (169,450 | )       |   |      | (138,278 | )      |      |   | (169,450 | )       |   |   | (138,278 | )     
|Additional minimum liability                                                   |                                               |              |         |         |      |   |         |        |   |   | (48,134  | )       |   |      | (69,681  | )      |      |   | (48,134  | )       |   |   | (69,681  | )     
|Intangible asset                                                               |                                               |              |         |         |      |   |         |        |   |   | 42,399   |         |   |      | 46,093   |        |      |   | 42,399   |         |   |   | 46,093   |       
|Accumulated other comprehensive income                                         |                                               |              |         |         |      |   |         |        |   |   | 5,735    |         |   |      | 23,588   |        |      |   | 5,735    |         |   |   | 23,588   |       
|                                                                               |                                               |              |          |         |      |   |          |        |   |   |          |         |   |      |          |        |      |  
|Net amount recognized                                                          |                                               | $            | 68,483   |         |      | $ | 69,489   |        |   | $ | (169,450 | )       |   | $    | (138,278 | )      |      | $ | (100,967 | )       |   | $ | (68,789  | )     
|                                                                               |                                               |              |          |         |      |   |          |        |   |   |          |         |   |      |          |        |      |  
|Significant Assumptions used to Determine Benefit
    Obligations, End of Year |                                               |              |          |         |      |   |          |        |   |   |          |         |   |      |          |        |      |   |          |         |   |   |          |       
|Discount rate                                                                  |                                               |              | 6.25     | %       |      |   | 6.00     | %      |   |   | 6.25     | %       |   |      | 6.00     | %      |      |   |          |         |   |   |          |       
|Rate of compensation increase                                                  |                                               |              | 5.00     |         |      |   | 5.00     |        |   |   | 5.00     |         |   |      | 5.00     |        |      |   |          |         |   |   |          |       
|Expected rate of return on plan assets                                         |                                               |              | 8.75     |         |      |   | 9.00     |        |   |   |          |         |   |      |          |        |      |   |          |         |   |   |          |       
|                                                                              



SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
   BENEFIT PLAN FINANCIAL INFORMATION











---



##### 



COMPONENTS OF NET PERIODIC BENEFIT
COST (dollars in thousands)


|                                                        |                               |                               |         |        |        |      |         |        |        |   |         |       |        |   |        |       |        |      |        |       |        |   |        |       |        |   |         |        |         |   |         |        |        |   |         |       |        | 
|------------------------------------------------------- | ----------------------------- | ----------------------------- | ------- | ------ | ------ | ---- | ------- | ------ | ------ | - | ------- | ----- | ------ | - | ------ | ----- | ------ | ---- | ------ | ----- | ------ | - | ------ | ----- | ------ | - | ------- | ------ | ------- | - | ------- | ------ | ------ | - | ------- | ----- | ------ | 
|                                                        |                               | Pension Plan                  |         |        | SERP   |      |         | Total  |       
|                                                        |                              
|Year Ended December 31,                                 |                               |                               | 2004    |        |        | 2003 |         |        | 2002   |   |         | 2004  |        |   | 2003   |       |        | 2002 |        |       | 2004   |   |        | 2003  |        |   | 2002    |       
|                                                        |                               |                               |        
|Service cost-benefits earned during the year            |                               | $                             | 60,225  |        |        | $    | 49,775  |        |        | $ | 37,813  |       |        | $ | 14,674 |       |        | $    | 15,090 |       |        | $ | 13,115 |       |        | $ | 74,899  |        |         | $ | 64,865  |        |        | $ | 50,928  |      
|Interest cost on projected benefit obligation           |                               |                               | 34,511  |        |        |      | 28,899  |        |        |   | 23,349  |       |        |   | 13,732 |       |        |      | 12,964 |       |        |   | 11,299 |       |        |   | 48,243  |        |         |   | 41,863  |        |        |   | 34,648  |      
|Expected return on plan assets                          |                               |                               | (37,702 | )      |        |      | (26,050 | )      |        |   | (25,579 | )     |        |   |       |       |        |      |       |       |        |   |       |       |        |   | (37,702 | )      |         |   | (26,050 | )      |        |   | (25,579 | )    
|Net amortization and deferral:                          |                               |                               |         |        |        |      |         |        |        |   |         |       |        |   |        |       |        |      |        |       |        |   |        |       |        |   |         |        |         |   |         |        |        |   |         |      
|                                                        | Prior service cost            |                               |         | 1,085  |        |      |         | 1,085  |        |   |         | 730   |        |   |        | 3,119 |        |      |        | 3,136 |        |   |        | 2,598 |        |   |         | 4,204  |         |   |         | 4,221  |        |   |         | 3,328 |       
|                                                        | Actuarial loss                |                               |         | 11,846 |        |      |         | 10,593 |        |   |         | 2,910 |        |   |        | 700   |        |      |        | 146   |        |   |        |      |        |   |         | 12,546 |         |   |         | 10,739 |        |   |         | 2,910 |       
|                                                        | Transition (asset) obligation |                               |         |       |        |      |         |       |        |   |         | (69   | )      |   |        | 415   |        |      |        | 415   |        |   |        | 415   |        |   |         | 415    |         |   |         | 415    |        |   |         | 346   |       
|                                                        |                               |                               |         |        |        |      |         |        |        |   |         |       |        |   |        |       |        |      |        |       |        |   |        |       |        |   |        
|                                                        |                               | Net amortization and deferral |         |        | 12,931 |      |         |        | 11,678 |   |         |       | 3,571  |   |        |       | 4,234  |      |        |       | 3,697  |   |        |       | 3,013  |   |         |        | 17,165  |   |         |        | 15,375 |   |         |       | 6,584  | 
|                                                        |                               |                               |         |        |        |      |         |        |        |   |         |       |        |   |        |       |        |      |        |       |        |   |        |       |        |   |        
|                                                        |                               | Net periodic benefit cost     |         | $      | 69,965 |      |         | $      | 64,302 |   |         | $     | 39,154 |   |        | $     | 32,640 |      |        | $     | 31,751 |   |        | $     | 27,427 |   |         | $      | 102,605 |   |         | $      | 96,053 |   |         | $     | 66,581 | 
|                                                        |                               |                               |         |        |        |      |         |        |        |   |         |       |        |   |        |       |        |      |        |       |        |   |        |       |        |   |        
|                                                       
|Assumptions Used to Determine Net Periodic Benefit Cost |                               |                               |         |        |        |      |         |        |        |   |         |       |        |   |        |       |        |      |        |       |        |   |        |       |        |   |         |        |         |   |         |        |        |   |         |      
|Discount rate                                           |                               |                               | 6.00    | %      |        |      | 6.75    | %      |        |   | 7.50    | %     |        |   | 6.00   | %     |        |      | 6.75   | %     |        |   | 7.50   | %     |        |   |         |        |         |   |         |        |        |   |         |      
|Rate of compensation increase                           |                               |                               | 5.00    |        |        |      | 5.50    |        |        |   | 6.00    |       |        |   | 5.00   |       |        |      | 5.50   |       |        |   | 6.00   |       |        |   |         |        |         |   |         |        |        |   |         |      
|Expected return on plan assets                          |                               |                               | 9.00    |        |        |      | 9.00    |        |        |   | 9.50    |       |        |   |        |       |        |      |        |       |        |   |        |       |        |   |         |        |         |   |         |        |        |   |         |      
|                                                       



COMPONENTS OF NET PERIODIC BENEFIT COST
  PLAN ASSETS
  Percentageof PlanTarget
    
    Assets atAllocation For
    
    Year EndYear Ended December 31,
    
    2005
    
    2004
    
    2003Asset CategoryEquity securities
    
    
    70
    %
    
    
    73
    %
    
    
    71
    %Tactical asset allocation
    
    
    
    
    
    
    10
    
    
    
    10Debt securities
    
    
    25
    
    
    
    17
    
    
    
    19Real estate
    
    
    5
    
    
    
    
    
    
    
    Total
    
    
    100
    %
    
    
    100
    %
    
    
    100
    %




EMPLOYEE BENEFIT PLAN INFORMATION
 (dollars in thousands)
 December 31,
    
    2004
    
    2003Pension PlanProjected benefit obligation
    
    $
    595,275
    
    
    $
    517,846Accumulated benefit obligation
    
    
    342,630
    
    
    
    279,696Fair value of plan assets
    
    
    481,345
    
    
    
    378,407SERPProjected benefit obligation
    
    
    239,759
    
    
    
    227,595Accumulated benefit obligation
    
    
    218,789
    
    
    
    207,959Fair value of plan assets
    
    
    
    
    
    
     EXPECTED CASH FLOWS
  EXPECTED CASH
FLOWS (dollars in
thousands)
 PensionPlan
    
    SERP
    
    TotalExpected Employer Contributions2005 to plan trust
    
    $
    75,000
    
    
    $
    
    
    
    $
    75,0002005 to plan participants
    
    
    
    
    
    
    8,716
    
    
    
    8,716Expected Benefit Payments2005
    
    
    3,358
    
    
    
    8,716
    
    
    
    12,0742006
    
    
    4,372
    
    
    
    10,286
    
    
    
    14,6582007
    
    
    5,709
    
    
    
    11,363
    
    
    
    17,0722008
    
    
    7,499
    
    
    
    12,775
    
    
    
    20,2742009
    
    
    9,788
    
    
    
    14,917
    
    
    
    24,7052010 through 2014
    
    
    104,842
    
    
    
    106,410
    
    
    
    211,252 401(k) PLUS SAVINGS PLAN








---



##### 





OTHER PLANS
  
 POSTRETIREMENT AND POSTEMPLOYMENT BENEFITS
   ASSUMED HEALTH CARE COST TREND RATES
 December 31,
    
    2004
    
    2003Health care cost trend rate assumed for next year
    
    
    9.00
    %
    
    
    11.00
    %Rate to which the cost trend is assumed to decline (the ultimate
    trend rate)
    
    
    5.00
    
    
    
    5.00Year that the rate reaches the ultimate trend rate
    
    
    2013
    
    
    
    2013




HEALTHCARE
EFFECT (dollars in
thousands)
 1-Percentage
    
    1-PercentagePoint Increase
    
    Point DecreaseEffect on postretirement benefit obligation
    
    $
    5,009
    
    
    $
    (4,462
    )Effect on total of service cost and interest cost
    
    
    538
    
    
    
    (477
    )   NOTE 25: STOCK-BASED EMPLOYEE COMPENSATION








---



##### 






SUMMARY OF STOCK OPTION PLANS ACTIVITY
 (shares in thousands)
 WeightedNumber
    
    Averageof Shares
    
    Exercise Price2004Options outstanding, beginning of year
    
    
    99,197
    
    
    $
    17.66Granted
    
    
    50
    
    
    
    24.71Exercised
    
    
    (13,822
    )
    
    
    13.91Canceled
    
    
    (608
    )
    
    
    20.66Options outstanding, end of
    year
    
    
    84,817
    
    
    
    18.25Options exercisable, end of
    year
    
    
    69,458
    
    
    
    17.41Weighted average fair value of options granted during the year
    
    $
    7.412003Options outstanding, beginning of year
    
    
    110,728
    
    
    $
    16.05Granted
    
    
    12,514
    
    
    
    20.54Exercised
    
    
    (23,708
    )
    
    
    11.63Canceled
    
    
    (337
    )
    
    
    19.78Options outstanding, end of
    year
    
    
    99,197
    
    
    
    17.66Options exercisable, end of
    year
    
    
    71,526
    
    
    
    16.17Weighted average fair value of options granted during the year
    
    $
    7.022002Options outstanding, beginning of year
    
    
    113,026
    
    
    $
    12.66Granted
    
    
    20,675
    
    
    
    23.88Exercised
    
    
    (22,521
    )
    
    
    6.15Canceled
    
    
    (452
    )
    
    
    19.90Options outstanding, end of
    year
    
    
    110,728
    
    
    
    16.05Options exercisable, end of
    year
    
    
    80,748
    
    
    
    14.11Weighted average fair value of options granted during the year
    
    $
    8.37


SUMMARY OF STOCK OPTIONS
OUTSTANDING (shares in
thousands)


|                         |                      |                  |                     |  |           |                     |  |                  |                |    |        |           |       |                  |                |  |        |  |  |   |       | 
|------------------------ | -------------------- | ---------------- | ------------------- |  | --------- | ------------------- |  | ---------------- | -------------- | -- | ------ | --------- | ----- | ---------------- | -------------- |  | ------ |  |  | - | ----- | 
|December 31, 2004        |                      |                  | Options Outstanding |  |           | Options Exercisable | 
|                         |                     
|                         |                      | Weighted Average |                     |  |          
|                         |                      | Number           |                     |  | Remaining |                     |  | Weighted Average |                |    | Number |           |       | Weighted Average |               
|Range of Exercise Prices |                      |                  | of Shares           |  |           | Contractual Life    |  |                  | Exercise Price |    |        | of Shares |       |                  | Exercise Price | 
|                         |                     
|                         | $  1.00  to  $  4.99 |                  |                     |  | 1,523     |                     |  |                  | .86 yea        | rs |        | $         | 4.88  |                  |                |  | 1,523  |  |  | $ | 4.88  | 
|                         | 5.00  to     9.99    |                  |                     |  | 9,577     |                     |  |                  | 2.10           |    |        |           | 8.04  |                  |                |  | 9,577  |  |  |   | 8.04  | 
|                         | 10.00  to    14.99   |                  |                     |  | 16,345    |                     |  |                  | 4.25           |    |        |           | 14.24 |                  |                |  | 16,345 |  |  |   | 14.24 | 
|                         | 15.00  to    19.99   |                  |                     |  | 9,472     |                     |  |                  | 4.41           |    |        |           | 17.74 |                  |                |  | 9,417  |  |  |   | 17.74 | 
|                         | 20.00  to    24.99   |                  |                     |  | 47,890    |                     |  |                  | 7.08           |    |        |           | 22.19 |                  |                |  | 32,586 |  |  |   | 22.24 | 
|                         | 25.00  to    30.00   |                  |                     |  | 10        |                     |  |                  | 9.42           |    |        |           | 25.36 |                  |                |  | 10     |  |  |   | 25.36 | 
|                         |                      |                  |                     |  |           |                     |  |                  |                |    |        |           |       |                  |                | 
|                         | 1.00  to    30.00    |                  |                     |  | 84,817    |                     |  |                  |                |    |        |           |       |                  |                |  | 69,458 |  |  |   |       | 
|                         |                      |                  |                     |  |           |                     |  |                  |                |    |        |           |       |                  |                | 
|                        







---



##### 





NOTE 26: OTHER OPERATING EXPENSE
 OTHER EXPENSE COMPONENT OF TOTAL OTHER OPERATING
EXPENSE (dollars in
thousands)
 Year Ended December 31,
    
    2004
    
    2003
    
    2002Purchased services
    
    $
    656,505
    
    
    $
    582,724
    
    
    $
    544,104Advertising
    
    
    390,572
    
    
    
    421,965
    
    
    
    315,393Collection
    
    
    110,999
    
    
    
    77,482
    
    
    
    54,872Stationery and supplies
    
    
    41,389
    
    
    
    41,833
    
    
    
    48,073Service bureau
    
    
    95,530
    
    
    
    83,171
    
    
    
    75,444Postage and delivery
    
    
    441,303
    
    
    
    459,592
    
    
    
    366,129Telephone usage
    
    
    88,630
    
    
    
    89,448
    
    
    
    86,562Loan receivable fraud losses
    
    
    150,195
    
    
    
    139,193
    
    
    
    160,639Amortization of intangible assets
    
    
    453,837
    
    
    
    410,973
    
    
    
    348,727Other
    
    
    277,397
    
    
    
    207,031
    
    
    
    248,317Total other expense
    
    $
    2,706,357
    
    
    $
    2,513,412
    
    
    $
    2,248,260 NOTE 27: DIVIDEND LIMITATIONS











---



##### 



NOTE 28: CAPITAL ADEQUACY


CAPITAL
ADEQUACY (dollars in
thousands)


|                                          |                               |        |   |             |                   |  |                         |                        |   |  |       |           |  |        |  |      |       |  |   |           |   |  |  |       |  
|----------------------------------------- | ----------------------------- | ------ | - | ----------- | ----------------- |  | ----------------------- | ---------------------- | - |  | ----- | --------- |  | ------ |  | ---- | ----- |  | - | --------- | - |  |  | ----- | -
|                                          |                               |        |   |             |                   |  |                         | To Be Well-Capitalized |  
|                                          |                               |        |   | For Capital |                   |  | Under Prompt Corrective |                       
|                                          |                               | Actual |   |             | Adequacy Purposes |  |                         | Action Provisions      |  
|                                          |                              
|                                          |                               | Amount |   |             | Ratio             |  |                         | Amount                 |   |  | Ratio |           |  | Amount |  |      | Ratio | 
|                                          |                               |        |  
|December 31, 2004                         |                               |        |   |             |                   |  |                         |                        |   |  |       |           |  |        |  |      |       |  |   |           |   |  |  |      
|Tier 1 Capital (to Risk-Weighted Assets): |                               |        |   |             |                   |  |                         |                        |   |  |       |           |  |        |  |      |       |  |   |           |   |  |  |      
|                                          | MBNA Corporation              |        | $ | 13,967,552  |                   |  |                         | 21.82                  | % |  | $     | 2,559,949 |  |        |  | 4.00 | %     |  |   | (a        | ) |  |  |       |  
|                                          | MBNA America Bank, N.A.       |        |   | 12,643,465  |                   |  |                         | 21.51                  |   |  |       | 2,351,544 |  |        |  | 4.00 |       |  | $ | 3,527,316 |   |  |  | 6.00  | %
|                                          | MBNA America (Delaware), N.A. |        |   | 575,650     |                   |  |                         | 15.79                  |   |  |       | 145,781   |  |        |  | 4.00 |       |  |   | 218,671   |   |  |  | 6.00  |  
|Total Capital (to Risk-Weighted Assets):  |                               |        |   |             |                   |  |                         |                        |   |  |       |           |  |        |  |      |       |  |   |           |   |  |  |      
|                                          | MBNA Corporation              |        |   | 16,248,639  |                   |  |                         | 25.39                  |   |  |       | 5,119,899 |  |        |  | 8.00 |       |  |   | (a        | ) |  |  |       |  
|                                          | MBNA America Bank, N.A.       |        |   | 14,849,178  |                   |  |                         | 25.26                  |   |  |       | 4,703,088 |  |        |  | 8.00 |       |  |   | 5,878,860 |   |  |  | 10.00 |  
|                                          | MBNA America (Delaware), N.A. |        |   | 622,707     |                   |  |                         | 17.09                  |   |  |       | 291,562   |  |        |  | 8.00 |       |  |   | 364,452   |   |  |  | 10.00 |  
|Tier 1 Capital (to Average Assets):       |                               |        |   |             |                   |  |                         |                        |   |  |       |           |  |        |  |      |       |  |   |           |   |  |  |      
|                                          | MBNA Corporation              |        |   | 13,967,552  |                   |  |                         | 22.80                  |   |  |       | 2,450,883 |  |        |  | 4.00 |       |  |   | (a        | ) |  |  |       |  
|                                          | MBNA America Bank, N.A.       |        |   | 12,643,465  |                   |  |                         | 21.87                  |   |  |       | 2,312,592 |  |        |  | 4.00 |       |  |   | 2,890,740 |   |  |  | 5.00  |  
|                                          | MBNA America (Delaware), N.A. |        |   | 575,650     |                   |  |                         | 16.12                  |   |  |       | 142,833   |  |        |  | 4.00 |       |  |   | 178,541   |   |  |  | 5.00  |  
|December 31, 2003                         |                               |        |   |             |                   |  |                         |                        |   |  |       |           |  |        |  |      |       |  |   |           |   |  |  |      
|Tier 1 Capital (to Risk-Weighted Assets): |                               |        |   |             |                   |  |                         |                        |   |  |       |           |  |        |  |      |       |  |   |           |   |  |  |      
|                                          | MBNA Corporation              |        | $ | 11,998,873  |                   |  |                         | 18.47                  | % |  | $     | 2,598,126 |  |        |  | 4.00 | %     |  |   | (a        | ) |  |  |       |  
|                                          | MBNA America Bank, N.A.       |        |   | 10,286,026  |                   |  |                         | 16.38                  |   |  |       | 2,512,467 |  |        |  | 4.00 |       |  | $ | 3,768,700 |   |  |  | 6.00  | %
|                                          | MBNA America (Delaware), N.A. |        |   | 526,630     |                   |  |                         | 28.38                  |   |  |       | 74,214    |  |        |  | 4.00 |       |  |   | 111,321   |   |  |  | 6.00  |  
|Total Capital (to Risk-Weighted Assets):  |                               |        |   |             |                   |  |                         |                        |   |  |       |           |  |        |  |      |       |  |   |           |   |  |  |      
|                                          | MBNA Corporation              |        |   | 14,409,042  |                   |  |                         | 22.18                  |   |  |       | 5,196,252 |  |        |  | 8.00 |       |  |   | (a        | ) |  |  |       |  
|                                          | MBNA America Bank, N.A.       |        |   | 12,644,844  |                   |  |                         | 20.13                  |   |  |       | 5,024,933 |  |        |  | 8.00 |       |  |   | 6,281,167 |   |  |  | 10.00 |  
|                                          | MBNA America (Delaware), N.A. |        |   | 551,920     |                   |  |                         | 29.75                  |   |  |       | 148,428   |  |        |  | 8.00 |       |  |   | 185,535   |   |  |  | 10.00 |  
|Tier 1 Capital (to Average Assets):       |                               |        |   |             |                   |  |                         |                        |   |  |       |           |  |        |  |      |       |  |   |           |   |  |  |      
|                                          | MBNA Corporation              |        |   | 11,998,873  |                   |  |                         | 20.52                  |   |  |       | 2,338,976 |  |        |  | 4.00 |       |  |   | (a        | ) |  |  |       |  
|                                          | MBNA America Bank, N.A.       |        |   | 10,286,026  |                   |  |                         | 18.52                  |   |  |       | 2,221,105 |  |        |  | 4.00 |       |  |   | 2,776,382 |   |  |  | 5.00  |  
|                                          | MBNA America (Delaware), N.A. |        |   | 526,630     |                   |  |                         | 32.47                  |   |  |       | 64,870    |  |        |  | 4.00 |       |  |   | 81,088    |   |  |  | 5.00  |  
|                                         



|    |  |                                           
|--- |  | ------------------------------------------
|(a) |  | Not applicable for bank holding companies.








NOTE 29: COMMITMENTS AND CONTINGENCIES






---



##### 

















---



##### 



NOTE 30: FOREIGN ACTIVITIES
 SELECTED FOREIGN FINANCIAL DATA
 (dollars in thousands)
 Year Ended December 31,
    2004
    
    2003
    
    2002United Kingdom/ Ireland/ SpainTotal assets
    
    $
    15,534,772
    
    
    $
    11,958,296
    
    
    $
    9,194,940Total income
    
    
    2,055,737
    
    
    
    1,671,370
    
    
    
    1,298,322Income before income taxes
    
    
    177,453
    
    
    
    262,401
    
    
    
    199,986Net income
    
    
    136,652
    
    
    
    198,076
    
    
    
    148,497CanadaTotal assets
    
    
    1,449,344
    
    
    
    1,506,838
    
    
    
    1,064,344Total income
    
    
    406,095
    
    
    
    398,420
    
    
    
    281,327Income before income taxes
    
    
    147,728
    
    
    
    143,782
    
    
    
    93,962Net income
    
    
    80,089
    
    
    
    87,897
    
    
    
    79,123Other ForeignTotal assets
    
    
    1,101,336
    
    
    
    2,377,345
    
    
    
    2,426,402Total income
    
    
    45,612
    
    
    
    40,068
    
    
    
    22,029Loss before income taxes
    
    
    (42,369
    )
    
    
    (53,776
    )
    
    
    (13,973
    )Net loss
    
    
    (27,328
    )
    
    
    (34,686
    )
    
    
    (8,873
    )Total ForeignTotal assets
    
    
    18,085,452
    
    
    
    15,842,479
    
    
    
    12,685,686Total income
    
    
    2,507,444
    
    
    
    2,109,858
    
    
    
    1,601,678Income before income taxes
    
    
    282,812
    
    
    
    352,407
    
    
    
    279,975Net income
    
    
    189,413
    
    
    
    251,287
    
    
    
    218,747DomesticTotal assets
    
    
    43,628,688
    
    
    
    43,270,876
    
    
    
    40,171,060Total income
    
    
    9,819,561
    
    
    
    9,574,506
    
    
    
    8,829,315Income before income taxes
    
    
    3,848,817
    
    
    
    3,306,598
    
    
    
    2,505,441Net income
    
    
    2,487,883
    
    
    
    2,086,817
    
    
    
    1,547,207MBNA CorporationTotal assets
    
    
    61,714,140
    
    
    
    59,113,355
    
    
    
    52,856,746Total income
    
    
    12,327,005
    
    
    
    11,684,364
    
    
    
    10,430,993Income before income taxes
    
    
    4,131,629
    
    
    
    3,659,005
    
    
    
    2,785,416Net income
    
    
    2,677,296
    
    
    
    2,338,104
    
    
    
    1,765,954


FOREIGN LOAN RECEIVABLES DISTRIBUTION (a)
 (dollars in thousands)
 December 31,
    
    2004
    
    2003Loans Held for SecuritizationCredit card
    
    $
    1,199,678
    
    
    $
    2,798,190Other consumer
    
    
    -
    
    
    
    Commercial
    
    
    -
    
    
    
    Total loans held for securitization
    
    
    1,199,678
    
    
    
    2,798,190Loan PortfolioCredit card
    
    
    5,573,013
    
    
    
    3,967,192Other consumer
    
    
    3,266,118
    
    
    
    2,418,449Commercial
    
    
    1,226,191
    
    
    
    38,142Total loan portfolio
    
    
    10,065,322
    
    
    
    6,423,783Total loan receivables
    
    $
    11,265,000
    
    
    $
    9,221,973 (a)
    
    The Corporation reclassified certain loan products to separately
    report its commercial loan products. Business card products were
    reclassified from credit card loans to commercial loans, and all
    other commercial loan products were reclassified from other
    consumer loans to commercial loans. For purposes of
    comparability, certain prior period amounts have been
    reclassified. NOTE 31: RELATED PARTY TRANSACTIONS
   NOTE 32: FAIR VALUE OF FINANCIAL INSTRUMENTS








---



##### 



CARRYING VALUES AND ESTIMATED FAIR VALUES OF THE
CORPORATIONS FINANCIAL
ASSETS (dollars in
thousands)


|                                                            |                    |          |            |           |            |   |            |           |  |   |            |           |  |   |            |           | 
|----------------------------------------------------------- | ------------------ | -------- | ---------- | --------- | ---------- | - | ---------- | --------- |  | - | ---------- | --------- |  | - | ---------- | --------- | 
|December 31,                                                |                    | 2004     |            |           | 2003       |  
|                                                            |                   
|                                                            |                    | Carrying |            |           | Estimated  |   |            | Carrying  |  |   | Estimated  |          
|                                                            |                    | Value    |            |           | Fair Value |   |            | Value     |  |   | Fair Value |          
|                                                            |                    |          |           
|Financial Assets                                            |                    |          |            |           |            |   |            |           |  |   |            |           |  |   |            |          
|Cash and due from banks                                     |                    | $        | 949,706    |           |            | $ | 949,706    |           |  | $ | 660,022    |           |  | $ | 660,022    |          
|Money market instruments                                    |                    |          | 4,372,831  |           |            |   | 4,372,831  |           |  |   | 4,865,329  |           |  |   | 4,865,329  |          
|Investment securities:                                      |                    |          |            |           |            |   |            |           |  |   |            |           |  |   |            |          
|                                                            | Available-for-sale |          |            | 6,062,520 |            |   |            | 6,062,520 |  |   |            | 4,363,087 |  |   |            | 4,363,087 | 
|                                                            | Held-to-maturity   |          |            | 299,074   |            |   |            | 300,072   |  |   |            | 353,299   |  |   |            | 354,434   | 
|Loan receivables, net of reserve for possible credit losses |                    |          | 32,622,292 |           |            |   | 32,622,292 |           |  |   | 32,407,761 |           |  |   | 32,407,761 |          
|Accrued income receivable                                   |                    |          | 397,063    |           |            |   | 397,063    |           |  |   | 443,755    |           |  |   | 443,755    |          
|Accounts receivable from securitization                     |                    |          | 8,443,849  |           |            |   | 8,443,849  |           |  |   | 7,766,477  |           |  |   | 7,766,477  |          
|                                                           



FINANCIAL ASSETS




FINANCIAL LIABILITIES






---



##### 



CARRYING VALUES AND ESTIMATED FAIR VALUES OF THE
CORPORATIONS FINANCIAL LIABILITIES


(dollars in thousands)


|                              |  |          |            |  |            |   |            |          |  |   |            |  |  |   |            | 
|----------------------------- |  | -------- | ---------- |  | ---------- | - | ---------- | -------- |  | - | ---------- |  |  | - | ---------- | 
|December 31,                  |  | 2004     |            |  | 2003       |  
|                              | 
|                              |  | Carrying |            |  | Estimated  |   |            | Carrying |  |   | Estimated  | 
|                              |  | Value    |            |  | Fair Value |   |            | Value    |  |   | Fair Value | 
|                              |  |          |           
|Financial Liabilities         |  |          |            |  |            |   |            |          |  |   |            |  |  |   |            | 
|Deposits                      |  | $        | 31,239,504 |  |            | $ | 31,498,015 |          |  | $ | 31,836,081 |  |  | $ | 32,549,248 | 
|Short-term borrowings         |  |          | 2,104,414  |  |            |   | 2,113,602  |          |  |   | 1,025,463  |  |  |   | 1,053,277  | 
|Long-term debt and bank notes |  |          | 11,422,900 |  |            |   | 12,075,342 |          |  |   | 12,145,628 |  |  |   | 13,150,079 | 
|Accrued interest payable      |  |          | 286,313    |  |            |   | 286,313    |          |  |   | 319,227    |  |  |   | 319,227    | 
|                             



DERIVATIVE FINANCIAL INSTRUMENTS











---



##### 













SIGNIFICANT CLASSES OF DERIVATIVE FINANCIAL
INSTRUMENTS (dollars in
thousands)


|                                                     |                         |          |           |                  |                  |  |          |              |  |           |          |   |  |            |     |  |  |  |   |          |          |  
|---------------------------------------------------- | ----------------------- | -------- | --------- | ---------------- | ---------------- |  | -------- | ------------ |  | --------- | -------- | - |  | ---------- | --- |  |  |  | - | -------- | -------- | -
|                                                     |                         |          |           | Weighted Average |                  |  |         
|                                                     |                        
|                                                     |                         | Notional |           |                  |                  |  | Maturity |              |  | Estimated |         
|                                                     |                         | Amount   |           |                  | Receive Rate (a) |  |          | Pay Rate (b) |  |           | in Years |   |  | Fair Value |    
|                                                     |                         |          |          
|December 31, 2004                                    |                         |          |           |                  |                  |  |          |              |  |           |          |   |  |            |     |  |  |  |   |         
|Interest rate swap agreements                        |                         | $        | 8,874,349 |                  |                  |  | 5.32     | %            |  |           | 2.86     | % |  |            | 6.3 |  |  |  |   |         
|                                                     | Gross unrealized gains  |          |           |                  |                  |  |          |              |  |           |          |   |  |            |     |  |  |  | $ | 267,497  |         
|                                                     | Gross unrealized losses |          |           |                  |                  |  |          |              |  |           |          |   |  |            |     |  |  |  |   | (23,608  | )       
|                                                     |                         |          |           |                  |                  |  |          |              |  |           |          |   |  |            |    
|                                                     |                         | Total    |           |                  |                  |  |          |              |  |           |          |   |  |            |     |  |  |  |   | $        | 243,889  |  
|                                                     |                         |          |           |                  |                  |  |          |              |  |           |          |   |  |            |    
|Foreign exchange swap agreements                     |                         |          | 3,843,597 |                  |                  |  | 3.13     |              |  |           | 5.90     |   |  |            | 1.9 |  |  |  |   |         
|                                                     | Gross unrealized gains  |          |           |                  |                  |  |          |              |  |           |          |   |  |            |     |  |  |  | $ | 83,475   |         
|                                                     | Gross unrealized losses |          |           |                  |                  |  |          |              |  |           |          |   |  |            |     |  |  |  |   | (364,944 | )       
|                                                     |                         |          |           |                  |                  |  |          |              |  |           |          |   |  |            |    
|                                                     |                         | Total    |           |                  |                  |  |          |              |  |           |          |   |  |            |     |  |  |  |   | $        | (281,469 | )
|                                                     |                         |          |           |                  |                  |  |          |              |  |           |          |   |  |            |    
|Forward exchange contracts pounds sterling          |                         |          | 1,745,402 |                  |                  |  | 1.84     |              |  |           | 1.93     |   |  |            | .1  |  |  |  |   |         
|                                                     | Gross unrealized gains  |          |           |                  |                  |  |          |              |  |           |          |   |  |            |     |  |  |  | $ |         |         
|                                                     | Gross unrealized losses |          |           |                  |                  |  |          |              |  |           |          |   |  |            |     |  |  |  |   | (77,370  | )       
|                                                     |                         |          |           |                  |                  |  |          |              |  |           |          |   |  |            |    
|                                                     |                         | Total    |           |                  |                  |  |          |              |  |           |          |   |  |            |     |  |  |  |   | $        | (77,370  | )
|                                                     |                         |          |           |                  |                  |  |          |              |  |           |          |   |  |            |    
|Forward exchange contracts euros                    |                         |          |          |                  |                  |  |         |              |  |           |         |   |  |            |    |  |  |  |   |         
|                                                     | Gross unrealized gains  |          |           |                  |                  |  |          |              |  |           |          |   |  |            |     |  |  |  | $ |         |         
|                                                     | Gross unrealized losses |          |           |                  |                  |  |          |              |  |           |          |   |  |            |     |  |  |  |   |         |         
|                                                     |                         |          |           |                  |                  |  |          |              |  |           |          |   |  |            |    
|                                                     |                         | Total    |           |                  |                  |  |          |              |  |           |          |   |  |            |     |  |  |  |   | $        |         |  
|                                                     |                         |          |           |                  |                  |  |          |              |  |           |          |   |  |            |    
|Forward exchange contracts U.S. dollars (c)         |                         |          | 1,755,984 |                  |                  |  | .53      |              |  |           | .52      |   |  |            | .1  |  |  |  |   |         
|Forward exchange contracts
    U.S. dollars (d) (e) |                         |          | 405,273   |                  |                  |  | .75      |              |  |           | .73      |   |  |            |    |  |  |  |   |         
|                                                     | Gross unrealized gains  |          |           |                  |                  |  |          |              |  |           |          |   |  |            |     |  |  |  | $ | 42       |         
|                                                     | Gross unrealized losses |          |           |                  |                  |  |          |              |  |           |          |   |  |            |     |  |  |  |   | (44,742  | )       
|                                                     |                         |          |           |                  |                  |  |          |              |  |           |          |   |  |            |    
|                                                     |                         | Total    |           |                  |                  |  |          |              |  |           |          |   |  |            |     |  |  |  |   | $        | (44,700  | )
|                                                     |                         |          |           |                  |                  |  |          |              |  |           |          |   |  |            |    
|December 31, 2003                                    |                         |          |           |                  |                  |  |          |              |  |           |          |   |  |            |     |  |  |  |   |         
|Interest rate swap agreements                        |                         | $        | 9,055,033 |                  |                  |  | 5.43     | %            |  |           | 2.03     | % |  |            | 6.8 |  |  |  |   |         
|                                                     | Gross unrealized gains  |          |           |                  |                  |  |          |              |  |           |          |   |  |            |     |  |  |  | $ | 361,554  |         
|                                                     | Gross unrealized losses |          |           |                  |                  |  |          |              |  |           |          |   |  |            |     |  |  |  |   | (32,735  | )       
|                                                     |                         |          |           |                  |                  |  |          |              |  |           |          |   |  |            |    
|                                                     |                         | Total    |           |                  |                  |  |          |              |  |           |          |   |  |            |     |  |  |  |   | $        | 328,819  |  
|                                                     |                         |          |           |                  |                  |  |          |              |  |           |          |   |  |            |    
|Foreign exchange swap agreements                     |                         |          | 4,696,241 |                  |                  |  | 4.03     |              |  |           | 5.10     |   |  |            | 2.2 |  |  |  |   |         
|                                                     | Gross unrealized gains  |          |           |                  |                  |  |          |              |  |           |          |   |  |            |     |  |  |  | $ | 209,712  |         
|                                                     | Gross unrealized losses |          |           |                  |                  |  |          |              |  |           |          |   |  |            |     |  |  |  |   | (257,242 | )       
|                                                     |                         |          |           |                  |                  |  |          |              |  |           |          |   |  |            |    
|                                                     |                         | Total    |           |                  |                  |  |          |              |  |           |          |   |  |            |     |  |  |  |   | $        | (47,530  | )
|                                                     |                         |          |           |                  |                  |  |          |              |  |           |          |   |  |            |    
|Forward exchange contracts pounds sterling          |                         |          | 1,557,372 |                  |                  |  | 1.68     |              |  |           | 1.79     |   |  |            | .1  |  |  |  |   |         
|                                                     | Gross unrealized gains  |          |           |                  |                  |  |          |              |  |           |          |   |  |            |     |  |  |  | $ |         |         
|                                                     | Gross unrealized losses |          |           |                  |                  |  |          |              |  |           |          |   |  |            |     |  |  |  |   | (94,016  | )       
|                                                     |                         |          |           |                  |                  |  |          |              |  |           |          |   |  |            |    
|                                                     |                         | Total    |           |                  |                  |  |          |              |  |           |          |   |  |            |     |  |  |  |   | $        | (94,016  | )
|                                                     |                         |          |           |                  |                  |  |          |              |  |           |          |   |  |            |    
|Forward exchange contracts euros                    |                         |          | 101,034   |                  |                  |  | 1.17     |              |  |           | 1.26     |   |  |            | .1  |  |  |  |   |         
|                                                     | Gross unrealized gains  |          |           |                  |                  |  |          |              |  |           |          |   |  |            |     |  |  |  | $ |         |         
|                                                     | Gross unrealized losses |          |           |                  |                  |  |          |              |  |           |          |   |  |            |     |  |  |  |   | (7,661   | )       
|                                                     |                         |          |           |                  |                  |  |          |              |  |           |          |   |  |            |    
|                                                     |                         | Total    |           |                  |                  |  |          |              |  |           |          |   |  |            |     |  |  |  |   | $        | (7,661   | )
|                                                     |                         |          |           |                  |                  |  |          |              |  |           |          |   |  |            |    
|Forward exchange contracts U.S. dollars (c)         |                         |          | 420,376   |                  |                  |  | .57      |              |  |           | .56      |   |  |            | .1  |  |  |  |   |         
|Forward exchange contracts U.S. dollars (d)         |                         |          |          |                  |                  |  |         |              |  |           |         |   |  |            |    |  |  |  |   |         
|                                                     | Gross unrealized gains  |          |           |                  |                  |  |          |              |  |           |          |   |  |            |     |  |  |  | $ |         |         
|                                                     | Gross unrealized losses |          |           |                  |                  |  |          |              |  |           |          |   |  |            |     |  |  |  |   | (6,353   | )       
|                                                     |                         |          |           |                  |                  |  |          |              |  |           |          |   |  |            |    
|                                                     |                         | Total    |           |                  |                  |  |          |              |  |           |          |   |  |            |     |  |  |  |   | $        | (6,353   | )
|                                                     |                         |          |           |                  |                  |  |          |              |  |           |          |   |  |            |    
|                                                    



|    |  |                                                                                                                                                                                                                 
|--- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) |  | Weighted average receive rate represents the rate contracted at
    the time the derivative financial instruments were entered into.                                                                            
|(b) |  | Weighted average pay rate for the forward exchange contracts
    represents the spot rate for the currency the forward exchange
    contract was denominated in at December 31, 2004 and 2003,
    respectively.
|(c) |  | Pounds sterling exchanged for U.S. dollars.                                                                                                                                                                     
|(d) |  | Euros exchanged for U.S. dollars.                                                                                                                                                                               
|(e) |  | Forward exchange contracts due to mature in less than
    1 month.                                                                                                                                              







---



##### 



EXPECTED MATURITIES OF DERIVATIVE FINANCIAL
INSTRUMENTS (dollars in thousands)


|                                 |                      |  |               |           |   |           |   |           |            |  |   |               |  |  |       |           |  |  |   |           |  
|-------------------------------- | -------------------- |  | ------------- | --------- | - | --------- | - | --------- | ---------- |  | - | ------------- |  |  | ----- | --------- |  |  | - | --------- | -
|December 31, 2004                |                      |  | Within 1 Year |           |   | 1-5 Years |   |           | 6-10 Years |  |   | Over 10 Years |  |  | Total |          
|                                 |                     
|Interest Rate Swap Agreements    |                      |  |               |           |   |           |   |           |            |  |   |               |  |  |       |           |  |  |   |          
|                                 | Notional amount      |  | $             | 637,005   |   |           | $ | 4,624,517 |            |  | $ | 2,526,524     |  |  | $     | 1,086,303 |  |  | $ | 8,874,349 |  
|                                 | Estimated fair value |  |               | 16,989    |   |           |   | 110,889   |            |  |   | 101,328       |  |  |       | 14,683    |  |  |   | 243,889   |  
|Foreign Exchange Swap Agreements |                      |  |               |           |   |           |   |           |            |  |   |               |  |  |       |           |  |  |   |          
|                                 | Notional amount      |  |               | 1,481,498 |   |           |   | 2,362,099 |            |  |   |              |  |  |       |          |  |  |   | 3,843,597 |  
|                                 | Estimated fair value |  |               | (43,795   | ) |           |   | (237,674  | )          |  |   |              |  |  |       |          |  |  |   | (281,469  | )
|Forward Exchange Contracts       |                      |  |               |           |   |           |   |           |            |  |   |               |  |  |       |           |  |  |   |          
|                                 | Notional amount      |  |               | 3,906,659 |   |           |   |          |            |  |   |              |  |  |       |          |  |  |   | 3,906,659 |  
|                                 | Estimated fair value |  |               | (122,070  | ) |           |   |          |            |  |   |              |  |  |       |          |  |  |   | (122,070  | )
|                                











SUMMARY OF ACTIVITY OF DERIVATIVE FINANCIAL INSTRUMENTS
(NOTIONAL AMOUNTS) (a)


(dollars in thousands)


|                           |  |                 |           |   |                  |   |             |                  |  |   |            |   |  |   |             |  
|-------------------------- |  | --------------- | --------- | - | ---------------- | - | ----------- | ---------------- |  | - | ---------- | - |  | - | ----------- | -
|                           |  | Interest Rate   |           |   | Forward Exchange |   |             | Foreign Exchange |  |   |           
|                           |  | Swap Agreements |           |   | Contracts        |   |             | Swap Agreements  |  |   | Total      |  
|                          
|                           |  |                 |           |   |                  |   |             |                  |  |   |            |   |  |   |             |  
|Balance, December 31, 2001 |  | $               | 2,883,373 |   |                  | $ | 1,443,123   |                  |  | $ | 1,852,129  |   |  | $ | 6,178,625   |  
|Additions                  |  |                 | 3,933,176 |   |                  |   | 12,619,569  |                  |  |   | 1,266,104  |   |  |   | 17,818,849  |  
|Maturities                 |  |                 | (272,606  | ) |                  |   | (10,796,372 | )                |  |   | (120,834   | ) |  |   | (11,189,812 | )
|                           |  |                 |           |   |                  |   |             |                  |  |   |            |  
|Balance, December 31, 2002 |  |                 | 6,543,943 |   |                  |   | 3,266,320   |                  |  |   | 2,997,399  |   |  |   | 12,807,662  |  
|Additions                  |  |                 | 2,674,016 |   |                  |   | 16,560,962  |                  |  |   | 2,106,430  |   |  |   | 21,341,408  |  
|Maturities                 |  |                 | (162,926  | ) |                  |   | (17,748,500 | )                |  |   | (407,588   | ) |  |   | (18,319,014 | )
|                           |  |                 |           |   |                  |   |             |                  |  |   |            |  
|Balance, December 31, 2003 |  |                 | 9,055,033 |   |                  |   | 2,078,782   |                  |  |   | 4,696,241  |   |  |   | 15,830,056  |  
|Additions                  |  |                 | 797,801   |   |                  |   | 17,418,284  |                  |  |   | 1,146,630  |   |  |   | 19,362,715  |  
|Maturities                 |  |                 | (978,485  | ) |                  |   | (15,590,407 | )                |  |   | (1,999,274 | ) |  |   | (18,568,166 | )
|                           |  |                 |           |   |                  |   |             |                  |  |   |            |  
|Balance, December 31, 2004 |  | $               | 8,874,349 |   |                  | $ | 3,906,659   |                  |  | $ | 3,843,597  |   |  | $ | 16,624,605  |  
|                           |  |                 |           |   |                  |   |             |                  |  |   |            |  
|                          

|    |  |                                                                                                
|--- |  | -----------------------------------------------------------------------------------------------
|(a) |  | Additions include adjustments for foreign exchange
    rate fluctuations throughout the year.







---



##### 





NOTE 33: PARENT COMPANY FINANCIAL INFORMATION





CONDENSED STATEMENTS OF FINANCIAL
CONDITION (dollars in thousands)


|                                                                                         |          |                                            |            |            |            |      |            |            |            | 
|---------------------------------------------------------------------------------------- | -------- | ------------------------------------------ | ---------- | ---------- | ---------- | ---- | ---------- | ---------- | ---------- | 
|December 31,                                                                             |          |                                            | 2004       |            |            | 2003 |           
|                                                                                         |         
|Assets                                                                                  
|Cash and due from bank subsidiary                                                        |          | $                                          | 6,551      |            |            | $    | 4,997      |           
|Interest-earning time deposits due from bank subsidiary                                  |          |                                            | 1,316,696  |            |            |      | 1,487,196  |           
|Notes receivable from non-bank subsidiaries                                              |          |                                            | 1,551,256  |            |            |      | 1,513,745  |           
|Investment in subsidiaries:                                                              |          |                                            |            |            |            |      |            |           
|                                                                                         | Bank     |                                            |            | 13,607,568 |            |      |            | 11,250,446 |           
|                                                                                         | Non-bank |                                            |            | 285,941    |            |      |            | 267,169    |           
|Premises and equipment, net                                                              |          |                                            | 93         |            |            |      | 167,530    |           
|Accrued income receivable                                                                |          |                                            | 75,867     |            |            |      | 84,644     |           
|Investment in variable interest entities                                                 |          |                                            | 32,906     |            |            |      | 32,902     |           
|Other assets                                                                             |          |                                            | 363,970    |            |            |      | 379,982    |           
|                                                                                         |          |                                            |            |            |            |     
|                                                                                         |          | Total assets                               |            | $          | 17,240,848 |      |            | $          | 15,188,611 | 
|                                                                                         |          |                                            |            |            |            |     
|                                                                                        
|Liabilities and Stockholders Equity                                                    
|Long-term debt                                                                           |          | $                                          | 2,376,009  |            |            | $    | 2,519,055  |           
|Junior subordinated deferrable interest debentures due to
    variable interest entities |          |                                            | 1,127,103  |            |            |      | 1,134,624  |           
|Accrued interest payable                                                                 |          |                                            | 48,305     |            |            |      | 49,083     |           
|Dividends payable                                                                        |          |                                            | 156,602    |            |            |      | 130,704    |           
|Accrued expenses and other liabilities                                                   |          |                                            | 209,577    |            |            |      | 242,105    |           
|                                                                                         |          |                                            |            |            |            |     
|                                                                                         |          | Total liabilities                          |            |            | 3,917,596  |      |            |            | 4,075,571  | 
|Stockholders equity                                                                     |          |                                            | 13,323,252 |            |            |      | 11,113,040 |           
|                                                                                         |          |                                            |            |            |            |     
|                                                                                         |          | Total liabilities and stockholders equity |            | $          | 17,240,848 |      |            | $          | 15,188,611 | 
|                                                                                         |          |                                            |            |            |            |     
|                                                                                        







---



##### 



CONDENSED STATEMENTS OF
INCOME (dollars in
thousands)


|                                                                                      |          |                         |           |           |         |      |           |           |         |   |           |           |         | 
|------------------------------------------------------------------------------------- | -------- | ----------------------- | --------- | --------- | ------- | ---- | --------- | --------- | ------- | - | --------- | --------- | ------- | 
|Year Ended December 31,                                                               |          |                         | 2004      |           |         | 2003 |           |           | 2002    |  
|                                                                                      |         
|Operating Income                                                                      |          |                         |           |           |         |      |           |           |         |   |           |          
|Interest income                                                                       |          | $                       | 131,308   |           |         | $    | 124,117   |           |         | $ | 122,165   |          
|Dividends from bank subsidiaries                                                      |          |                         | 600,000   |           |         |      | 450,147   |           |         |   | 352,000   |          
|Dividends from variable interest entities and non-bank
    subsidiaries               |          |                         | 2,186     |           |         |      | 1,633     |           |         |   | 1,410     |          
|Management fees from subsidiaries                                                     |          |                         | 88,999    |           |         |      | 150,087   |           |         |   | 166,160   |          
|Other                                                                                 |          |                         | 5,387     |           |         |      | 7,427     |           |         |   | 3,820     |          
|                                                                                      |          |                         |           |           |         |      |           |           |        
|                                                                                      |          | Total operating income  |           |           | 827,880 |      |           |           | 733,411 |   |           |           | 645,555 | 
|Operating Expense                                                                     |          |                         |           |           |         |      |           |           |         |   |           |          
|Interest expense                                                                      |          |                         | 112,395   |           |         |      | 104,546   |           |         |   | 93,321    |          
|Salaries and employee benefits                                                        |          |                         | 97,329    |           |         |      | 115,595   |           |         |   | 99,479    |          
|Other                                                                                 |          |                         | 15,847    |           |         |      | 30,179    |           |         |   | 59,388    |          
|                                                                                      |          |                         |           |           |         |      |           |           |        
|                                                                                      |          | Total operating expense |           |           | 225,571 |      |           |           | 250,320 |   |           |           | 252,188 | 
|                                                                                      |          |                         |           |           |         |      |           |           |        
|Income before income taxes and equity in undistributed net
    income of subsidiaries |          |                         | 602,309   |           |         |      | 483,091   |           |         |   | 393,367   |          
|Applicable (benefit) income taxes                                                     |          |                         | (6,046    | )         |         |      | 5,175     |           |         |   | 22,284    |          
|Equity in undistributed net income of subsidiaries:                                   |          |                         |           |           |         |      |           |           |         |   |           |          
|                                                                                      | Bank     |                         |           | 2,054,144 |         |      |           | 1,846,944 |         |   |           | 1,390,837 |        
|                                                                                      | Non-bank |                         |           | 14,797    |         |      |           | 13,244    |         |   |           | 4,034     |        
|                                                                                      |          |                         |           |           |         |      |           |           |        
|Net Income                                                                            |          | $                       | 2,677,296 |           |         | $    | 2,338,104 |           |         | $ | 1,765,954 |          
|                                                                                      |          |                         |           |           |         |      |           |           |        
|                                                                                     







---



##### 



CONDENSED STATEMENTS OF CASH
FLOWS (dollars in
thousands)


|                                                                                                               |                                                   |                                                     |           |            |          |      |            |            |          |   |           |            |          |  
|-------------------------------------------------------------------------------------------------------------- | ------------------------------------------------- | --------------------------------------------------- | --------- | ---------- | -------- | ---- | ---------- | ---------- | -------- | - | --------- | ---------- | -------- | -
|Year Ended December 31,                                                                                        |                                                   |                                                     | 2004      |            |          | 2003 |            |            | 2002     |  
|                                                                                                               |                                                  
|Operating Activities                                                                                           |                                                   |                                                     |           |            |          |      |            |            |          |   |           |           
|Net Income                                                                                                     |                                                   | $                                                   | 2,677,296 |            |          | $    | 2,338,104  |            |          | $ | 1,765,954 |           
|Adjustments to reconcile net income to net cash provided by
    operating activities:                          |                                                   |                                                     |           |            |          |      |            |            |          |   |           |           
|                                                                                                               | Equity in undistributed earnings of subsidiaries  |                                                     |           | (2,068,941 | )        |      |            | (1,860,188 | )        |   |           | (1,394,871 | )       
|                                                                                                               | Deferred income tax benefit                       |                                                     |           | (5,157     | )        |      |            | (13,719    | )        |   |           | (8,560     | )       
|                                                                                                               | Depreciation and amortization                     |                                                     |           | 90,488     |          |      |            | 104,444    |          |   |           | 110,883    |         
|                                                                                                               | (Increase) decrease in other operating activities |                                                     |           | (11,847    | )        |      |            | 15,894     |          |   |           | (22,683    | )       
|                                                                                                               |                                                   |                                                     |           |            |          |      |            |            |         
|                                                                                                               |                                                   | Net cash provided by operating activities           |           |            | 681,839  |      |            |            | 584,535  |   |           |            | 450,723  |  
|Investing Activities                                                                                           |                                                   |                                                     |           |            |          |      |            |            |          |   |           |           
|Net decrease (increase) in interest-earning time deposits due
    from bank subsidiary                         |                                                   |                                                     | 170,500   |            |          |      | (389,400   | )          |          |   | (618,000  | )         
|Net issuance of notes receivable from non-bank subsidiaries                                                    |                                                   |                                                     | (37,511   | )          |          |      | (23,583    | )          |          |   | (3,275    | )         
|Net sales (purchases) of premises and equipment                                                                |                                                   |                                                     | 161,288   |            |          |      | 20,605     |            |          |   | (60,888   | )         
|Net investment in subsidiaries                                                                                 |                                                   |                                                     | (3,975    | )          |          |      | (17,925    | )          |          |   | (162,214  | )         
|Proceeds from sale of investment securities available-for-sale                                                 |                                                   |                                                     | 1,267     |            |          |      |           |            |          |   | 13,126    |           
|                                                                                                               |                                                   |                                                     |           |            |          |      |            |            |         
|                                                                                                               |                                                   | Net cash provided by (used in) investing activities |           |            | 291,569  |      |            |            | (410,303 | ) |           |            | (831,251 | )
|Financing Activities                                                                                           |                                                   |                                                     |           |            |          |      |            |            |          |   |           |           
|Proceeds from issuance of long-term debt                                                                       |                                                   |                                                     |          |            |          |      | 1,039,191  |            |          |   | 1,188,959 |           
|Maturity of long-term debt                                                                                     |                                                   |                                                     | (130,000  | )          |          |      | (434,000   | )          |          |   | (495,000  | )         
|Proceeds from issuance of junior subordinated deferrable
    interest debentures to variable interest entities |                                                   |                                                     |          |            |          |      |           |            |          |   | 515,464   |           
|Proceeds from issuance of common stock                                                                         |                                                   |                                                     |          |            |          |      | 1,082,186  |            |          |   |          |           
|Proceeds from exercise of stock options and other awards                                                       |                                                   |                                                     | 192,273   |            |          |      | 275,793    |            |          |   | 138,422   |           
|Acquisition and retirement of common stock                                                                     |                                                   |                                                     | (432,393  | )          |          |      | (1,700,824 | )          |          |   | (615,503  | )         
|Dividends paid                                                                                                 |                                                   |                                                     | (601,734  | )          |          |      | (435,800   | )          |          |   | (350,740  | )         
|                                                                                                               |                                                   |                                                     |           |            |          |      |            |            |         
|                                                                                                               |                                                   | Net cash (used in) provided by financing activities |           |            | (971,854 | )    |            |            | (173,454 | ) |           |            | 381,602  |  
|                                                                                                               |                                                   |                                                     |           |            |          |      |            |            |         
|Increase in Cash and Cash Equivalents                                                                          |                                                   |                                                     | 1,554     |            |          |      | 778        |            |          |   | 1,074     |           
|Cash and cash equivalents at beginning of year                                                                 |                                                   |                                                     | 4,997     |            |          |      | 4,219      |            |          |   | 3,145     |           
|                                                                                                               |                                                   |                                                     |           |            |          |      |            |            |         
|Cash and cash equivalents at end of year                                                                       |                                                   | $                                                   | 6,551     |            |          | $    | 4,997      |            |          | $ | 4,219     |           
|                                                                                                               |                                                   |                                                     |           |            |          |      |            |            |         
|Supplemental Disclosures                                                                                       |                                                   |                                                     |           |            |          |      |            |            |          |   |           |           
|Interest expense paid                                                                                          |                                                   | $                                                   | 104,136   |            |          | $    | 102,866    |            |          | $ | 79,425    |           
|                                                                                                               |                                                   |                                                     |           |            |          |      |            |            |         
|Income taxes paid                                                                                              |                                                   | $                                                   |          |            |          | $    |           |            |          | $ |          |           
|                                                                                                               |                                                   |                                                     |           |            |          |      |            |            |         
|                                                                                                              







---



##### 





NOTE 34: SUBSEQUENT EVENTS (UNAUDITED)













---



##### 



QUARTERLY DATA
(UNAUDITED) (dollars in thousands, except per share
amounts)


|                                                                                  |  |           |           |  |          |   |           |               |  |   |              |  |  |   |           | 
|--------------------------------------------------------------------------------- |  | --------- | --------- |  | -------- | - | --------- | ------------- |  | - | ------------ |  |  | - | --------- | 
|Three Months Ended,                                                               |  | March 31, |           |  | June 30, |   |           | September 30, |  |   | December 31, | 
|                                                                                  | 
|2004                                                                              |  |           |           |  |          |   |           |               |  |   |              |  |  |   |           | 
|Interest income                                                                   |  | $         | 1,033,105 |  |          | $ | 967,589   |               |  | $ | 1,002,193    |  |  | $ | 1,065,732 | 
|Interest expense                                                                  |  |           | 365,300   |  |          |   | 373,344   |               |  |   | 390,532      |  |  |   | 402,642   | 
|Net interest income                                                               |  |           | 667,805   |  |          |   | 594,245   |               |  |   | 611,661      |  |  |   | 663,090   | 
|Provision for possible credit losses                                              |  |           | 365,161   |  |          |   | 251,557   |               |  |   | 273,387      |  |  |   | 256,750   | 
|Other operating income                                                            |  |           | 1,942,532 |  |          |   | 1,999,620 |               |  |   | 2,159,590    |  |  |   | 2,156,644 | 
|Other operating expense                                                           |  |           | 1,441,918 |  |          |   | 1,371,866 |               |  |   | 1,348,678    |  |  |   | 1,354,241 | 
|Income before income taxes                                                        |  |           | 803,258   |  |          |   | 970,442   |               |  |   | 1,149,186    |  |  |   | 1,208,743 | 
|Net income                                                                        |  |           | 519,708   |  |          |   | 660,335   |               |  |   | 728,309      |  |  |   | 768,944   | 
|Net income applicable to common stock                                             |  |           | 516,192   |  |          |   | 656,819   |               |  |   | 724,793      |  |  |   | 765,428   | 
|Earnings per common share                                                         |  |           | .40       |  |          |   | .51       |               |  |   | .57          |  |  |   | .60       | 
|Earnings per common shareassuming dilution                                       |  |           | .40       |  |          |   | .51       |               |  |   | .56          |  |  |   | .59       | 
|Weighted average common shares outstanding (000)                                  |  |           | 1,277,953 |  |          |   | 1,277,726 |               |  |   | 1,277,665    |  |  |   | 1,277,987 | 
|Weighted average common shares outstanding and common
    stock equivalents (000) |  |           | 1,301,071 |  |          |   | 1,297,054 |               |  |   | 1,294,107    |  |  |   | 1,296,521 | 
|2003                                                                              |  |           |           |  |          |   |           |               |  |   |              |  |  |   |           | 
|Interest income                                                                   |  | $         | 944,027   |  |          | $ | 959,915   |               |  | $ | 969,529      |  |  | $ | 985,413   | 
|Interest expense                                                                  |  |           | 388,431   |  |          |   | 380,747   |               |  |   | 369,617      |  |  |   | 369,716   | 
|Net interest income                                                               |  |           | 555,596   |  |          |   | 579,168   |               |  |   | 599,912      |  |  |   | 615,697   | 
|Provision for possible credit losses                                              |  |           | 378,877   |  |          |   | 345,603   |               |  |   | 334,064      |  |  |   | 334,157   | 
|Other operating income                                                            |  |           | 1,788,009 |  |          |   | 1,851,804 |               |  |   | 2,032,469    |  |  |   | 2,153,198 | 
|Other operating expense                                                           |  |           | 1,287,875 |  |          |   | 1,235,068 |               |  |   | 1,267,389    |  |  |   | 1,333,815 | 
|Income before income taxes                                                        |  |           | 676,853   |  |          |   | 850,301   |               |  |   | 1,030,928    |  |  |   | 1,100,923 | 
|Net income                                                                        |  |           | 432,509   |  |          |   | 543,342   |               |  |   | 658,763      |  |  |   | 703,490   | 
|Net income applicable to common stock                                             |  |           | 428,993   |  |          |   | 539,826   |               |  |   | 655,247      |  |  |   | 699,974   | 
|Earnings per common share                                                         |  |           | .34       |  |          |   | .42       |               |  |   | .51          |  |  |   | .55       | 
|Earnings per common shareassuming dilution                                       |  |           | .33       |  |          |   | .42       |               |  |   | .51          |  |  |   | .54       | 
|Weighted average common shares outstanding (000)                                  |  |           | 1,278,980 |  |          |   | 1,278,144 |               |  |   | 1,277,810    |  |  |   | 1,277,748 | 
|Weighted average common shares outstanding and common
    stock equivalents (000) |  |           | 1,292,647 |  |          |   | 1,294,246 |               |  |   | 1,296,312    |  |  |   | 1,297,300 | 
|                                                                                 







---



##### 



PREFERRED STOCK PRICE RANGE AND DIVIDENDS (UNAUDITED)


|         |                |      |   |       |     |  |   |              |  |  |                 |       |  |  |  |         | 
|-------- | -------------- | ---- | - | ----- | --- |  | - | ------------ |  |  | --------------- | ----- |  |  |  | ------- | 
|         |                |      |   |       |     |  |   | Dividends    | 
|         |                |      |   |       |     |  |   | Declared per | 
|         |                | High |   |       | Low |  |   | Close        |  |  | Preferred Share |      
|         |               
|Series A |                |      |   |       |     |  |   |              |  |  |                 |       |  |  |  |        
|         | 2004           |      |   |       |     |  |   |              |  |  |                 |       |  |  |  |         | 
|         | Fourth quarter |      | $ | 26.65 |     |  | $ | 25.65        |  |  | $               | 26.05 |  |  |  | $.46875 | 
|         | Third quarter  |      |   | 25.95 |     |  |   | 25.32        |  |  |                 | 25.65 |  |  |  | .46875  | 
|         | Second quarter |      |   | 26.20 |     |  |   | 24.05        |  |  |                 | 25.38 |  |  |  | .46875  | 
|         | First quarter  |      |   | 26.95 |     |  |   | 25.73        |  |  |                 | 26.50 |  |  |  | .46875  | 
|         | 2003           |      |   |       |     |  |   |              |  |  |                 |       |  |  |  |         | 
|         | Fourth quarter |      |   | 26.60 |     |  |   | 25.25        |  |  |                 | 25.85 |  |  |  | .46875  | 
|         | Third quarter  |      |   | 26.35 |     |  |   | 25.25        |  |  |                 | 25.35 |  |  |  | .46875  | 
|         | Second quarter |      |   | 26.35 |     |  |   | 25.25        |  |  |                 | 26.00 |  |  |  | .46875  | 
|         | First quarter  |      |   | 25.45 |     |  |   | 24.60        |  |  |                 | 25.20 |  |  |  | .46875  | 
|Series B |                |      |   |       |     |  |   |              |  |  |                 |       |  |  |  |        
|         | 2004           |      |   |       |     |  |   |              |  |  |                 |       |  |  |  |         | 
|         | Fourth quarter |      | $ | 26.32 |     |  | $ | 25.72        |  |  | $               | 25.87 |  |  |  | $.34380 | 
|         | Third quarter  |      |   | 26.33 |     |  |   | 25.50        |  |  |                 | 26.12 |  |  |  | .34380  | 
|         | Second quarter |      |   | 26.22 |     |  |   | 25.05        |  |  |                 | 25.30 |  |  |  | .34380  | 
|         | First quarter  |      |   | 26.45 |     |  |   | 25.17        |  |  |                 | 26.20 |  |  |  | .34380  | 
|         | 2003           |      |   |       |     |  |   |              |  |  |                 |       |  |  |  |         | 
|         | Fourth quarter |      |   | 26.36 |     |  |   | 25.00        |  |  |                 | 25.70 |  |  |  | .34380  | 
|         | Third quarter  |      |   | 25.75 |     |  |   | 24.55        |  |  |                 | 25.10 |  |  |  | .34380  | 
|         | Second quarter |      |   | 25.45 |     |  |   | 23.20        |  |  |                 | 24.90 |  |  |  | .34380  | 
|         | First quarter  |      |   | 25.20 |     |  |   | 22.95        |  |  |                 | 23.25 |  |  |  | .34380  | 
|        



1 2













---



##### 



COMMON STOCK PRICE RANGE AND DIVIDENDS (UNAUDITED)


|               |  |      |       |  |     |   |       |              |  |   |              |  |  |  |       | 
|-------------- |  | ---- | ----- |  | --- | - | ----- | ------------ |  | - | ------------ |  |  |  | ----- | 
|               |  |      |       |  |     |   |       | Dividends    | 
|               |  |      |       |  |     |   |       | Declared per | 
|               |  | High |       |  | Low |   |       | Close        |  |   | Common Share | 
|               | 
|2004           |  |      |       |  |     |   |       |              |  |   |              |  |  |  |       | 
|Fourth quarter |  | $    | 28.33 |  |     | $ | 24.00 |              |  | $ | 28.19        |  |  |  | $ .12 | 
|Third quarter  |  |      | 26.13 |  |     |   | 22.92 |              |  |   | 25.20        |  |  |  | .12   | 
|Second quarter |  |      | 28.04 |  |     |   | 23.42 |              |  |   | 25.79        |  |  |  | .12   | 
|First quarter  |  |      | 28.78 |  |     |   | 24.62 |              |  |   | 27.63        |  |  |  | .12   | 
|2003           |  |      |       |  |     |   |       |              |  |   |              |  |  |  |       | 
|Fourth quarter |  | $    | 25.45 |  |     | $ | 23.50 |              |  | $ | 24.85        |  |  |  | $ .10 | 
|Third quarter  |  |      | 24.91 |  |     |   | 20.72 |              |  |   | 22.80        |  |  |  | .10   | 
|Second quarter |  |      | 22.26 |  |     |   | 15.23 |              |  |   | 20.84        |  |  |  | .08   | 
|First quarter  |  |      | 20.75 |  |     |   | 12.15 |              |  |   | 15.05        |  |  |  | .08   | 
|              















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MBNA executive committee
 Gregg Bacchieri
    
    Group Executive, U.S. Business OperationsAnn L. Balthis
    
    Group Executive, Core Affinity GroupsKenneth F. Boehl
    
    Group Executive, Corporate InitiativesJohn R. Cochran
    
    Chief Operating OfficerDouglas R. Denton
    
    Vice Chairman, TechnologyJoseph DePaulo
    
    Group Executive, Branded CardShane G. Flynn
    
    Group Executive, EuropeLouis J. Freeh
    
    Vice Chairman, Law and Government AffairsBruce L. Hammonds
    
    President and Chief Executive OfficerJohn J. Hewes
    
    Group Executive, Consumer Finance and Business LendingCharles C. Krulak
    
    Vice Chairman, Personnel and New Business AcquisitionJanine D. Marrone
    
    Group Executive, Affinity MaximizationTerri C. Murphy
    
    Group Executive, Personnel and CompensationMichael G. Rhodes
    
    Group Executive, U.S. Credit Card Business DevelopmentJohn W. Scheflen
    
    Vice Chairman, Governance and Risk ManagementMichelle D. Shepherd
    
    Group Executive, Major Affinity GroupsRichard K. Struthers
    
    Vice Chairman, International and Consumer LendingDavid G. Turner
    
    Group Executive, Research and DevelopmentKenneth A. Vecchione
    
    Vice Chairman and Chief Financial OfficerLance L. Weaver
    
    Vice Chairman, U.S. Credit CardThomas D. Wren
    
    Group Executive, Treasury
 MBNA annual report
2004          121




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MBNA office locations  
 
 International Headquarters  MBNA Corporation
Wilmington, DE 19884
(800) 441-7048
    MBNA Offices United States 75 Enterprise, Suite 200
Aliso Viejo, CA 92656 1075 Silver Lake Blvd.
Dover, DE 19904 210 Town Park Dr.
Kennesaw, GA 30144 11333 McCormick Rd.
Hunt Valley, MD 21031 1 Hatley Rd.
Belfast, ME 04915 5 Industrial Pkwy.
Brunswick, ME 04011 274 Front St.
Farmington, ME 04938 50 Pleasant St.
Fort Kent, ME 04743 16 Godfrey Dr.
Orono, ME 04473 901 Washington Ave.
Portland, ME 04103 18 Green Hill Dr.
Presque Isle, ME 04769
 12 Water St.
Rockland, ME 04841 100 Main St., Suite 303
Dover, NH 03820 320 University Ave.
Newark, NJ 07102 9 W. 57th St.
New York, NY 10019 388 S. Main St.
Akron, OH 44311 25875 Science Park Dr.
Beachwood, OH 44122 2740 Airport Dr.
Columbus, OH 43219 2568 Park Centre Blvd.
State College, PA 16801 16001 N. Dallas Pkwy.
Addison, TX 75001 Canada 1600 James Naismith Dr.
Gloucester, Ontario
K1B 5N8 1000 de la Gauchetière, Suite 4300
Montréal, Québec
H3B 4W5
 Ireland Dublin Road
Carrick-on-Shannon
Co Leitrim United Kingdom Chester Business Park
Wrexham Rd.
Chester, Cheshire
CH4 9FB 86 Jermyn St.
London SW1Y 6JD 60 East St.
Epsom, Surrey
KT17 1HB Spain C/Jose Echegaray 6
28230 Las Rozas China
(Representative Office) Suite 2006, 20th Floor, Jin Mao Tower
88 Century Rd.
Pudong, Shanghai 200121
     122          MBNA annual report 2004




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Subsidiaries of MBNA Corporation 
 MBNA America Bank, N.A. The principal subsidiary of MBNA Corporation, MBNA America is the largest independent credit card
lender in the world. It also provides retail deposit, consumer loan, and insurance products. MBNA
America markets its products through thousands of membership organizations and financial
institutions and is the recognized industry leader in affinity marketing. MBNA America (Delaware), N.A. The Corporation is also the parent of MBNA America (Delaware), N.A., a national bank that offers
mortgage loans, aircraft loans, business card products, and other commercial loans. Subsidiaries of MBNA America Bank, N.A. 
 MBNA Europe Bank Limited MBNA issues credit cards in the United Kingdom, the Republic of Ireland, and Spain. MBNA Europe is
headquartered in Chester, England, with business development offices in London, England;
Carrick-on-Shannon, Ireland; and Las Rozas, Spain. MBNA Canada Bank MBNA issues credit cards in Canada. MBNA Canada is headquartered in Gloucester, Ontario, with a
business development office in Montréal, Québec. MBNA Marketing Systems, Inc. MBNA has state-of-the-art telephone sales facilities to support account acquisition and maintains
offices in California, Delaware, Georgia, Maine, Maryland, New Hampshire, New Jersey, New York,
Ohio, Pennsylvania, and Texas. In addition to credit cards, MBNA Marketing Systems cross-sells
consumer loan, deposit, and insurance products. MBNA Technology, Inc. MBNA Technology, Inc., headquartered in Addison, Texas, provides information technology support and
services to MBNA America Bank, N.A., and its affiliates. MBNA.com 
 Through a single Web address  www.MBNA.com  Customers can access their existing account
information, apply for new credit card or consumer loan accounts, shop for products and services,
redeem MBNA rewards program points, plan and finance travel, and open certificates of deposit or
money market accounts. Independent Registered
    
    Corporate RegistrarsPublic Accounting Firm
    
    and Transfer AgentsErnst & Young LLP
    
    National City Bank (common stock) (800) 622-6757The Bank of New York (preferred stock) (212) 815-4302
 Principal Financial Contacts 
 For further information about MBNA Corporation or its subsidiaries, please contact: Brian Dalphon
    
    Edward H. Murphy, Director, Investor RelationsMBNA Corporation
    
    MBNA CorporationWilmington, DE 19884-0146
    
    Wilmington, DE 19884-0131(800) 362-6255 or (302) 432-1251
    
    (800)362-6255 or (302) 432-0202
 Internet address: www.MBNA.com Common Stock 
 Listed on New York Stock
Exchange Stock Symbol KRB The Corporation filed on May 12, 2004, the certification of the Chief Executive Officer required
under Section 303A.12(a) of the New York Stock Exchanges Listed Company Manual.




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