##### 



Exhibit 99.1
 
 For Immediate Release
    
    CONTACT:
    
    Charles D. ChristyChief Financial Officer(810) 237-4200Charlie.Christy@cbcf-net.comCONTACT:
    
    Kathleen MillerInvestor Relations(810) 257-2506Kathleen.Miller@cbcf-net.comTRADED:
    
    NASDAQSYMBOL:
    
    CBCF
 April 20, 2006
 CITIZENS BANKING CORPORATION
ANNOUNCES FIRST QUARTER 2006 RESULTS
 FLINT,
MICHIGAN 
  Key Highlights in the Quarter:
 
    
    Net interest margin increased two basis points to 3.97%
compared with the fourth quarter of 2005 and increased one
basis point compared with the first quarter of 2005,
reflecting disciplined product pricing and effective
balance sheet and risk management practices.
 
    
    Nonperforming assets decreased $3.4 million or 8.5% from
the fourth quarter of 2005 to $36.5 million at March 31,
2006 and the nonperforming asset ratio improved to 0.65%,
its lowest level in four years, from 0.71% at December 31,
2005. The decrease reflects reductions in nonperforming
commercial, consumer and mortgage loans and other
repossessed assets acquired, which was partially offset by
an increase in restructured loans.
 
    
    Commercial loan growth in several traditional Michigan and
Wisconsin markets, along with Southeast Michigan, more
than offset declines in other markets. In total, average
commercial loans increased $36.3 million or 1.2% over the
fourth quarter of 2005 and increased by $155.2 million or
4.0% over the first quarter of 2005.
 
    
    During late March 2006, Citizens created the Citizens Bank
Business Finance lending division as part of its strategy
to expand the commercial loan portfolio, augment its
commercial lending product set, and enhance its credit
management capabilities. The Citizens Bank Business
Finance team is managed and staffed by well-seasoned and
highly experienced asset-based lending professionals
located in Southeast Michigan.
 
    
    Trust fees for the first quarter of 2006 were $5.0
million, an increase of 1.1% over the fourth quarter of
2005 and an increase of $0.6 million or 14.3% over the
first quarter of 2005. The increases were attributable to
stronger financial markets, continued execution of the
sales management process and improved pricing discipline,
partially offset by attrition. This marks the fourth
consecutive quarterly increase in trust fees.
 
    
    On March 13, 2006, Citizens announced a strategic alliance
with PHH Mortgage, a leading provider of private label
mortgage services. PHH Mortgage will provide mortgage
loan processing, servicing, secondary marketing
 1




---



##### 



functions, and other mortgage-related loan services. Once fully
implemented, Citizens expects the PHH alliance will
improve cost-effectiveness, expand product capability and
enhance sales execution by increasing opportunities for
origination through multiple channels. The alliance is
expected to be fully implemented by the end of June 2006.
 
    
    Citizens expanded its footprint in Southeast Michigan with
the opening of new branch facilities in Novi, Michigan and
Royal Oak, Michigan. Both offices are staffed with
commercial, consumer, and mortgage personnel.
 
    
    Citizens fully recognized a deferred gain of $2.9 million
on the 2004 sale of its former downtown Royal Oak office,
which was deferred due to leaseback restrictions. The
gain was offset by a $1.5 million contribution to
Citizens charitable foundation; severance related to the
PHH alliance and loan operations consolidation; additional
advertising and consulting; and corporate-wide conferences
and communications related to Citizens new strategic
objectives.
 Balance Sheet
       2




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##### 



Credit Quality
      Net Interest Margin and Net Interest Income
   3




---



##### 



Noninterest Income
        4




---



##### 



Noninterest Expense
         Income Tax Provision
  5




---



##### 



Other News
 Citizens Plans to Consolidate Loan Operations
  Citizens Creates an Asset-Based Lending Group
  Stock Repurchase Program
  Dividend Announcement
 .
 Investor Conference Call
 10:00am EDT on Friday, April 21, 2006.
 http://www.vcall.com/IC/CEPage.asp?ID=103323
 www.citizensonline.com.
 Corporate Profile
  6




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##### 



Safe Harbor Statement
  
 http://www.citizensonline.com
 7




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##### 



Consolidated Balance Sheets (Unaudited)  Citizens Banking Corporation and Subsidiaries
 March 31,
    
    
    December 31,
    
    
    March 31,(in thousands)
    
    2006
    
    
    2005
    
    
    2005AssetsCash and due from banks
    
    $
    152,077
    
    
    $
    194,748
    
    
    $
    145,707Interest-bearing deposits with banks
    
    
    1,503
    
    
    
    380
    
    
    
    1,596Investment Securities:Available-for-sale (amortized cost $1,479,416, $1,501,819 and $1,761,586, respectively)U.S. Treasury and federal agency securities
    
    
    1,087,099
    
    
    
    1,122,306
    
    
    
    1,377,766State and municipal securities
    
    
    378,454
    
    
    
    378,235
    
    
    
    386,515Other securities
    
    
    1,243
    
    
    
    1,456
    
    
    
    963Held-to-maturity:State and municipal securities (fair value of $89,699, $82,364 and $58,622, respectively)
    
    
    90,346
    
    
    
    82,431
    
    
    
    58,942FHLB and Federal Reserve stock
    
    
    55,975
    
    
    
    55,911
    
    
    
    68,020Total investment securities
    
    
    1,613,117
    
    
    
    1,640,339
    
    
    
    1,892,206Mortgage loans held for sale
    
    
    13,399
    
    
    
    16,252
    
    
    
    34,627Portfolio loans:Commercial
    
    
    1,688,970
    
    
    
    1,688,079
    
    
    
    1,626,541Commercial real estate
    
    
    1,418,596
    
    
    
    1,402,128
    
    
    
    1,313,825Residential mortgage loans
    
    
    549,116
    
    
    
    539,824
    
    
    
    495,953Direct consumer
    
    
    1,109,249
    
    
    
    1,142,002
    
    
    
    1,173,234Indirect consumer
    
    
    826,060
    
    
    
    844,086
    
    
    
    820,289Total portfolio loans
    
    
    5,591,991
    
    
    
    5,616,119
    
    
    
    5,429,842Less: Allowance for loan losses
    
    
    (115,423
    )
    
    
    (116,400
    )
    
    
    (120,945
    )Net portfolio loans
    
    
    5,476,568
    
    
    
    5,499,719
    
    
    
    5,308,897Premises and equipment
    
    
    120,719
    
    
    
    121,730
    
    
    
    121,107Goodwill
    
    
    54,527
    
    
    
    54,527
    
    
    
    54,527Other intangible assets
    
    
    10,408
    
    
    
    11,133
    
    
    
    13,307Bank owned life insurance
    
    
    85,142
    
    
    
    84,435
    
    
    
    83,072Other assets
    
    
    135,857
    
    
    
    128,620
    
    
    
    121,690Total assets
    
    $
    7,663,317
    
    
    $
    7,751,883
    
    
    $
    7,776,736LiabilitiesNoninterest-bearing deposits
    
    $
    899,850
    
    
    $
    969,074
    
    
    $
    891,849Interest-bearing demand deposits
    
    
    816,293
    
    
    
    891,313
    
    
    
    1,106,744Savings deposits
    
    
    1,452,638
    
    
    
    1,437,024
    
    
    
    1,578,058Time deposits
    
    
    2,355,206
    
    
    
    2,176,428
    
    
    
    1,712,883Total deposits
    
    
    5,523,987
    
    
    
    5,473,839
    
    
    
    5,289,534Federal funds purchased and securities sold
under agreements to repurchase
    
    
    401,702
    
    
    
    505,879
    
    
    
    853,926Other short-term borrowings
    
    
    852
    
    
    
    23,242
    
    
    
    6,157Other liabilities
    
    
    82,203
    
    
    
    86,351
    
    
    
    79,656Long-term debt
    
    
    1,003,029
    
    
    
    1,006,109
    
    
    
    901,875Total liabilities
    
    
    7,011,773
    
    
    
    7,095,420
    
    
    
    7,131,148Shareholders EquityPreferred stock  no par value
    
    
    
    
    
    
    
    
    
    
    Common stock  no par value
    
    
    80,341
    
    
    
    85,526
    
    
    
    94,966Retained earnings
    
    
    578,980
    
    
    
    570,483
    
    
    
    546,882Accumulated other comprehensive income
    
    
    (7,777
    )
    
    
    454
    
    
    
    3,740Total shareholders equity
    
    
    651,544
    
    
    
    656,463
    
    
    
    645,588Total liabilities and shareholders equity
    
    $
    7,663,317
    
    
    $
    7,751,883
    
    
    $
    7,776,736
 8




---



##### 



Consolidated Statements of Income (Unaudited)  Citizens Banking Corporation and Subsidiaries
 Three Months EndedMarch 31,(in thousands, except per share amounts)
    
    2006
    
    
    2005Interest IncomeInterest and fees on loans
    
    $
    93,451
    
    
    $
    79,272Interest and dividends on investment securities:Taxable
    
    
    13,611
    
    
    
    14,688Tax-exempt
    
    
    5,317
    
    
    
    5,197Money market investments
    
    
    12
    
    
    
    9Total interest income
    
    
    112,391
    
    
    
    99,166Interest ExpenseDeposits
    
    
    30,992
    
    
    
    18,071Short-term borrowings
    
    
    3,736
    
    
    
    4,441Long-term debt
    
    
    10,188
    
    
    
    8,421Total interest expense
    
    
    44,916
    
    
    
    30,933Net Interest Income
    
    
    67,475
    
    
    
    68,233Provision for loan losses
    
    
    3,000
    
    
    
    3,000Net interest income after provision for loan losses
    
    
    64,475
    
    
    
    65,233Noninterest IncomeService charges on deposit accounts
    
    
    8,875
    
    
    
    8,287Trust fees
    
    
    5,042
    
    
    
    4,412Mortgage and other loan income
    
    
    2,010
    
    
    
    2,360Brokerage and investment fees
    
    
    1,515
    
    
    
    1,599ATM network user fees
    
    
    987
    
    
    
    873Bankcard fees
    
    
    1,057
    
    
    
    840Fair value change in CD swap derivatives
    
    
    (207
    )
    
    
    Other
    
    
    6,284
    
    
    
    4,084Total fees and other income
    
    
    25,563
    
    
    
    22,455Investment securities gains (losses)
    
    
    7
    
    
    
    6Total noninterest income
    
    
    25,570
    
    
    
    22,461Noninterest ExpenseSalaries and employee benefits
    
    
    32,256
    
    
    
    33,351Occupancy
    
    
    5,942
    
    
    
    5,560Professional services
    
    
    4,078
    
    
    
    4,199Equipment
    
    
    3,166
    
    
    
    3,301Data processing services
    
    
    3,739
    
    
    
    3,369Advertising and public relations
    
    
    2,034
    
    
    
    1,746Postage and delivery
    
    
    1,462
    
    
    
    1,590Telephone
    
    
    1,464
    
    
    
    1,441Other loan expenses
    
    
    416
    
    
    
    375Stationery and supplies
    
    
    727
    
    
    
    919Intangible asset amortization
    
    
    725
    
    
    
    725Other
    
    
    5,563
    
    
    
    4,025Total noninterest expense
    
    
    61,572
    
    
    
    60,601Income Before Income Taxes
    
    
    28,473
    
    
    
    27,093Income tax provision
    
    
    7,717
    
    
    
    7,013Net Income
    
    $
    20,756
    
    
    $
    20,080Net Income Per Common Share:Basic
    
    $
    0.49
    
    
    $
    0.46Diluted
    
    
    0.48
    
    
    
    0.46Cash Dividends Declared Per Common Share
    
    
    0.285
    
    
    
    0.285Average Common Shares Outstanding:Basic
    
    
    42,784
    
    
    
    43,224Diluted
    
    
    42,941
    
    
    
    43,646
 9




---



##### 



Selected Quarterly Information  Citizens Banking Corporation and Subsidiaries
 1st Qtr 2006
    
    
    4th Qtr 2005
    
    
    3rd Qtr 2005
    
    
    2nd Qtr 2005
    
    
    1st Qtr 2005Summary of Operations (thousands)Interest income
    
    $
    112,391
    
    
    $
    111,958
    
    
    $
    108,506
    
    
    $
    103,619
    
    
    $
    99,166Interest expense
    
    
    44,916
    
    
    
    42,863
    
    
    
    38,864
    
    
    
    34,840
    
    
    
    30,933Net interest income
    
    
    67,475
    
    
    
    69,095
    
    
    
    69,642
    
    
    
    68,779
    
    
    
    68,233Provision for loan losses (1)
    
    
    3,000
    
    
    
    (7,287
    )
    
    
    4,000
    
    
    
    1,396
    
    
    
    3,000Net interest income after provision for loan losses
    
    
    64,475
    
    
    
    76,382
    
    
    
    65,642
    
    
    
    67,383
    
    
    
    65,233Total fees and other income (2)
    
    
    25,563
    
    
    
    19,930
    
    
    
    23,941
    
    
    
    23,109
    
    
    
    22,455Investment securities gains (losses) (3)
    
    
    7
    
    
    
    (8,970
    )
    
    
    
    
    
    
    37
    
    
    
    6Noninterest expense
    
    
    61,572
    
    
    
    60,901
    
    
    
    60,550
    
    
    
    60,990
    
    
    
    60,601Income tax provision
    
    
    7,717
    
    
    
    7,553
    
    
    
    8,041
    
    
    
    8,974
    
    
    
    7,013Net income
    
    
    20,756
    
    
    
    18,888
    
    
    
    20,992
    
    
    
    20,565
    
    
    
    20,080Taxable equivalent adjustment
    
    
    3,416
    
    
    
    3,432
    
    
    
    3,284
    
    
    
    3,324
    
    
    
    3,353At Period End (millions)Assets
    
    $
    7,663
    
    
    $
    7,752
    
    
    $
    7,851
    
    
    $
    7,826
    
    
    $
    7,777Earning assets
    
    
    7,220
    
    
    
    7,274
    
    
    
    7,397
    
    
    
    7,399
    
    
    
    7,358Portfolio loans
    
    
    5,592
    
    
    
    5,616
    
    
    
    5,569
    
    
    
    5,523
    
    
    
    5,430Deposits
    
    
    5,524
    
    
    
    5,474
    
    
    
    5,226
    
    
    
    5,201
    
    
    
    5,290Shareholders equity
    
    
    652
    
    
    
    656
    
    
    
    655
    
    
    
    662
    
    
    
    646Average Balances (millions)Assets
    
    $
    7,654
    
    
    $
    7,754
    
    
    $
    7,821
    
    
    $
    7,807
    
    
    $
    7,728Earning assets
    
    
    7,204
    
    
    
    7,311
    
    
    
    7,393
    
    
    
    7,386
    
    
    
    7,302Portfolio loans
    
    
    5,561
    
    
    
    5,575
    
    
    
    5,531
    
    
    
    5,472
    
    
    
    5,393Deposits
    
    
    5,513
    
    
    
    5,305
    
    
    
    5,239
    
    
    
    5,254
    
    
    
    5,349Shareholders equity
    
    
    655
    
    
    
    654
    
    
    
    655
    
    
    
    654
    
    
    
    649Shareholders equity / assets
    
    
    8.55
    %
    
    
    8.43
    %
    
    
    8.38
    %
    
    
    8.37
    %
    
    
    8.40
    %Credit Quality Statistics (thousands)Nonaccrual loans
    
    $
    27,689
    
    
    $
    32,140
    
    
    $
    35,527
    
    
    $
    42,191
    
    
    $
    36,593Loans 90 or more days past due and still accruing
    
    
    547
    
    
    
    385
    
    
    
    92
    
    
    
    2
    
    
    
    11Restructured loans
    
    
    1,844
    
    
    
    
    
    
    
    13
    
    
    
    32
    
    
    
    42Total nonperforming loans
    
    
    30,080
    
    
    
    32,525
    
    
    
    35,632
    
    
    
    42,225
    
    
    
    36,646Other repossessed assets acquired (ORAA)
    
    
    6,397
    
    
    
    7,351
    
    
    
    6,984
    
    
    
    6,817
    
    
    
    7,118Total nonperforming assets
    
    $
    36,477
    
    
    $
    39,876
    
    
    $
    42,616
    
    
    $
    49,042
    
    
    $
    43,764Allowance for loan losses
    
    $
    115,423
    
    
    $
    116,400
    
    
    $
    118,626
    
    
    $
    119,967
    
    
    $
    120,945Allowance for loan losses as a percent of portfolio loans
    
    
    2.06
    %
    
    
    2.07
    %
    
    
    2.13
    %
    
    
    2.17
    %
    
    
    2.23
    %Allowance for loan losses as a percent of nonperforming assets
    
    
    316.43
    
    
    
    291.90
    
    
    
    278.36
    
    
    
    244.62
    
    
    
    276.36Allowance for loan losses as a percent of nonperforming loans
    
    
    383.72
    
    
    
    357.88
    
    
    
    332.92
    
    
    
    284.11
    
    
    
    330.04Nonperforming assets as a percent of portfolio loans plus ORAA
    
    
    0.65
    
    
    
    0.71
    
    
    
    0.76
    
    
    
    0.89
    
    
    
    0.80Nonperforming assets as a percent of total assets
    
    
    0.48
    
    
    
    0.51
    
    
    
    0.54
    
    
    
    0.63
    
    
    
    0.56Net loans charged off as a percent of average portfolio loans (annualized)
    
    
    0.29
    
    
    
    (0.36
    )
    
    
    0.38
    
    
    
    0.17
    
    
    
    0.32Net loans charged off (000)
    
    $
    3,977
    
    
    $
    (5,061
    )
    
    $
    5,341
    
    
    $
    2,374
    
    
    $
    4,239Per Common Share DataNet Income:Basic
    
    $
    0.49
    
    
    $
    0.44
    
    
    $
    0.49
    
    
    $
    0.48
    
    
    $
    0.46Diluted
    
    
    0.48
    
    
    
    0.44
    
    
    
    0.48
    
    
    
    0.47
    
    
    
    0.46Dividends
    
    
    0.285
    
    
    
    0.285
    
    
    
    0.285
    
    
    
    0.285
    
    
    
    0.285Market Value:High
    
    $
    28.66
    
    
    $
    30.22
    
    
    $
    32.15
    
    
    $
    30.98
    
    
    $
    34.81Low
    
    
    25.62
    
    
    
    26.67
    
    
    
    28.20
    
    
    
    26.35
    
    
    
    29.02Close
    
    
    26.85
    
    
    
    27.75
    
    
    
    28.40
    
    
    
    30.22
    
    
    
    29.36Book value
    
    
    15.23
    
    
    
    15.28
    
    
    
    15.21
    
    
    
    15.31
    
    
    
    14.95Shares outstanding, end of period (000)
    
    
    42,770
    
    
    
    42,968
    
    
    
    43,044
    
    
    
    43,261
    
    
    
    43,173Performance Ratios (annualized)Net interest margin (FTE) (4)
    
    
    3.97
    %
    
    
    3.95
    %
    
    
    3.93
    %
    
    
    3.92
    %
    
    
    3.96
    %Return on average assets
    
    
    1.10
    
    
    
    0.97
    
    
    
    1.06
    
    
    
    1.06
    
    
    
    1.05Return on average shareholders equity
    
    
    12.86
    
    
    
    11.46
    
    
    
    12.71
    
    
    
    12.62
    
    
    
    12.54Efficiency ratio (5)
    
    
    63.84
    
    
    
    65.87
    
    
    
    62.51
    
    
    
    64.06
    
    
    
    64.44
 (1)
    
    The provision for loan losses and note loans charged off during the fourth quarter of 2005 reflect an insurance settlement of $9.1 million
accounted for as a
loan loss recovery.(2)
    
    Total fees and other income includes a cumulative charge of $3.6 million on swaps related to brokered certificates during the fourth quarter of 2005.(3)
    
    Investment securities gains (losses) includes a net loss of $9.0 million on the sale of securities as a result of restructuring the investment
portfolio during the
fourth quarter of 2005.(4)
    
    Net interest margin is presented on an annual basis, includes taxable equivalent adjustments to interest income and is based on a tax rate of 35%.(5)
    
    The Efficiency Ratio measures how efficiently a bank spends its revenues. The formula is: Noninterest expense/(Net interest income + Taxable equivalent
adjustment + Total fees and other income).
 10




---



##### 



Financial Summary and Comparison
Citizens Banking Corporation and Subsidiaries
 Three months endedMarch 31,2006
    
    
    2005
    
    
    % ChangeSummary of Operations (thousands)Interest income
    
    $
    112,391
    
    
    $
    99,166
    
    
    
    13.3
    %Interest expense
    
    
    44,916
    
    
    
    30,933
    
    
    
    45.2Net interest income
    
    
    67,475
    
    
    
    68,233
    
    
    
    (1.1
    )Provision for loan losses
    
    
    3,000
    
    
    
    3,000
    
    
    
    0.0Net interest income after provision for loan losses
    
    
    64,475
    
    
    
    65,233
    
    
    
    (1.2
    )Total fees and other income
    
    
    25,563
    
    
    
    22,455
    
    
    
    13.8Investment securities gains (losses)
    
    
    7
    
    
    
    6
    
    
    
    15.0Noninterest expense
    
    
    61,572
    
    
    
    60,601
    
    
    
    1.6Income tax provision
    
    
    7,717
    
    
    
    7,013
    
    
    
    10.0Net income
    
    
    20,756
    
    
    
    20,080
    
    
    
    3.4At Period End (millions)Assets
    
    $
    7,663
    
    
    $
    7,777
    
    
    
    (1.5
    )%Earning assets
    
    
    7,220
    
    
    
    7,358
    
    
    
    (1.9
    )Portfolio loans
    
    
    5,592
    
    
    
    5,430
    
    
    
    3.0Deposits
    
    
    5,524
    
    
    
    5,290
    
    
    
    4.4Shareholders equity
    
    
    652
    
    
    
    646
    
    
    
    0.9Average Balances (millions)Assets
    
    $
    7,654
    
    
    $
    7,728
    
    
    
    (1.0
    )%Earning assets
    
    
    7,204
    
    
    
    7,302
    
    
    
    (1.3
    )Portfolio loans
    
    
    5,561
    
    
    
    5,393
    
    
    
    3.1Deposits
    
    
    5,513
    
    
    
    5,349
    
    
    
    3.1Shareholders equity
    
    
    655
    
    
    
    649
    
    
    
    0.8Shareholders equity / assets
    
    
    8.55
    %
    
    
    8.40
    %
    
    
    1.8Per Common Share DataNet Income:Basic
    
    $
    0.49
    
    
    $
    0.46
    
    
    
    6.5
    %Diluted
    
    
    0.48
    
    
    
    0.46
    
    
    
    4.3Dividends
    
    
    0.285
    
    
    
    0.285
    
    
    
    0.0Market Value:High
    
    $
    28.66
    
    
    $
    34.81
    
    
    
    (17.7
    )Low
    
    
    25.62
    
    
    
    29.02
    
    
    
    (11.7
    )Close
    
    
    26.85
    
    
    
    29.36
    
    
    
    (8.5
    )Book value
    
    
    15.23
    
    
    
    14.95
    
    
    
    1.9Tangible book value
    
    
    13.72
    
    
    
    13.38
    
    
    
    2.5Shares outstanding, end of period (000)
    
    
    42,770
    
    
    
    43,173
    
    
    
    (0.9
    )Performance Ratios (annualized)Net interest margin (FTE) (1)
    
    
    3.97
    %
    
    
    3.96
    %
    
    
    0.3
    %Return on average assets
    
    
    1.10
    
    
    
    1.05
    
    
    
    4.8Return on average shareholders equity
    
    
    12.86
    
    
    
    12.54
    
    
    
    2.6Net loans charged off as a percent of average portfolio loans
    
    
    0.29
    
    
    
    0.32
    
    
    
    (9.4
    )
 
 (1)
    
    Net interest margin is presented on an annual basis and includes taxable equivalent adjustments to interest income of $3.4 million and $3.4
million for the three months ended March 31, 2006 and 2005, respectively, based on a tax rate of 35%. 11




---



##### 



Noninterest Income and Noninterest Expense (Unaudited)
Citizens Banking Corporation and Subsidiaries
 Three Months EndedMar 31
    
    
    Dec 31
    
    
    Sep 30
    
    
    Jun 30
    
    
    Mar 31(in thousands)
    
    2006
    
    
    2005
    
    
    2005
    
    
    2005
    
    
    2005NONINTEREST INCOME:Service charges on deposit accounts
    
    $
    8,875
    
    
    $
    8,957
    
    
    $
    9,343
    
    
    $
    8,822
    
    
    $
    8,287Trust fees
    
    
    5,042
    
    
    
    4,989
    
    
    
    4,541
    
    
    
    4,503
    
    
    
    4,412Mortgage and other loan income
    
    
    2,010
    
    
    
    2,099
    
    
    
    2,450
    
    
    
    2,074
    
    
    
    2,360Brokerage and investment fees
    
    
    1,515
    
    
    
    1,946
    
    
    
    1,974
    
    
    
    2,284
    
    
    
    1,599ATM network user fees
    
    
    987
    
    
    
    1,065
    
    
    
    1,194
    
    
    
    1,223
    
    
    
    873Bankcard fees
    
    
    1,057
    
    
    
    1,027
    
    
    
    976
    
    
    
    961
    
    
    
    840Fair value change in CD swap derivatives
    
    
    (207
    )
    
    
    (3,604
    )
    
    
    
    
    
    
    
    
    
    
    Other income
    
    
    6,284
    
    
    
    3,451
    
    
    
    3,463
    
    
    
    3,242
    
    
    
    4,084Total fees and other income
    
    
    25,563
    
    
    
    19,930
    
    
    
    23,941
    
    
    
    23,109
    
    
    
    22,455Investment securities gains (losses)
    
    
    7
    
    
    
    (8,970
    )
    
    
    
    
    
    
    37
    
    
    
    6TOTAL NONINTEREST INCOME
    
    $
    25,570
    
    
    $
    10,960
    
    
    $
    23,941
    
    
    $
    23,146
    
    
    $
    22,461NONINTEREST EXPENSE:Salaries and employee benefits
    
    $
    32,256
    
    
    $
    32,391
    
    
    $
    34,060
    
    
    $
    32,351
    
    
    $
    33,351Occupancy
    
    
    5,942
    
    
    
    5,631
    
    
    
    5,255
    
    
    
    5,685
    
    
    
    5,560Professional services
    
    
    4,078
    
    
    
    4,837
    
    
    
    4,517
    
    
    
    3,726
    
    
    
    4,199Equipment
    
    
    3,166
    
    
    
    3,263
    
    
    
    3,133
    
    
    
    4,937
    
    
    
    3,301Data processing services
    
    
    3,739
    
    
    
    3,744
    
    
    
    3,188
    
    
    
    3,499
    
    
    
    3,369Advertising and public relations
    
    
    2,034
    
    
    
    2,570
    
    
    
    1,717
    
    
    
    1,820
    
    
    
    1,746Postage and delivery
    
    
    1,462
    
    
    
    1,591
    
    
    
    1,512
    
    
    
    1,520
    
    
    
    1,590Telephone
    
    
    1,464
    
    
    
    1,333
    
    
    
    1,242
    
    
    
    1,465
    
    
    
    1,441Other loan expenses
    
    
    416
    
    
    
    686
    
    
    
    720
    
    
    
    874
    
    
    
    375Stationery and supplies
    
    
    727
    
    
    
    844
    
    
    
    726
    
    
    
    602
    
    
    
    919Intangible asset amortization
    
    
    725
    
    
    
    725
    
    
    
    725
    
    
    
    724
    
    
    
    725Other expense (1)
    
    
    5,563
    
    
    
    3,286
    
    
    
    3,755
    
    
    
    3,787
    
    
    
    4,025TOTAL NONINTEREST EXPENSE
    
    $
    61,572
    
    
    $
    60,901
    
    
    $
    60,550
    
    
    $
    60,990
    
    
    $
    60,601
 
 (1)The quarter ended March 31, 2006 includes the $1.5 million contribution to Citizens charitable foundation. 12




---



##### 



Average Balances, Yields and Rates
 Three Months EndedMarch 31, 2006
    
    
    December 31, 2005
    
    
    March 31, 2005Average
    
    
    Average
    
    
    Average
    
    
    Average
    
    
    Average
    
    
    Average(dollars in thousands)
    
    Balance
    
    
    Rate(1)
    
    
    Balance
    
    
    Rate(1)
    
    
    Balance(2)
    
    
    Rate(1)(2)Earning AssetsMoney market investments
    
    $
    1,684
    
    
    
    2.82
    
    
    
    1,688
    
    
    
    3.09
    
    
    
    1,799
    
    
    
    2.01Investment securities (3):Taxable
    
    
    1,181,397
    
    
    
    4.61
    
    
    
    1,271,730
    
    
    
    4.40
    
    
    
    1,435,683
    
    
    
    4.09Tax-exempt
    
    
    446,657
    
    
    
    7.33
    
    
    
    436,445
    
    
    
    7.52
    
    
    
    420,931
    
    
    
    7.60Mortgage loans held for sale
    
    
    16,471
    
    
    
    5.64
    
    
    
    29,545
    
    
    
    5.48
    
    
    
    31,341
    
    
    
    5.49Portfolio loans (4):Commercial
    
    
    1,646,899
    
    
    
    7.02
    
    
    
    1,636,024
    
    
    
    6.70
    
    
    
    1,615,304
    
    
    
    5.62Commercial real estate
    
    
    1,415,201
    
    
    
    6.88
    
    
    
    1,389,810
    
    
    
    6.62
    
    
    
    1,291,629
    
    
    
    6.08Residential mortgage loans
    
    
    541,390
    
    
    
    5.66
    
    
    
    534,840
    
    
    
    5.64
    
    
    
    497,925
    
    
    
    5.47Direct consumer
    
    
    1,124,379
    
    
    
    7.22
    
    
    
    1,158,271
    
    
    
    6.89
    
    
    
    1,167,894
    
    
    
    6.03Indirect consumer
    
    
    833,436
    
    
    
    6.61
    
    
    
    855,945
    
    
    
    6.62
    
    
    
    820,291
    
    
    
    6.66Total portfolio loans
    
    
    5,561,305
    
    
    
    6.83
    
    
    
    5,574,890
    
    
    
    6.61
    
    
    
    5,393,043
    
    
    
    5.96Total earning assets
    
    
    7,207,514
    
    
    
    6.49
    
    
    
    7,314,298
    
    
    
    6.27
    
    
    
    7,282,797
    
    
    
    5.68Nonearning AssetsCash and due from banks
    
    
    165,909
    
    
    
    
    
    
    
    165,562
    
    
    
    
    
    
    
    158,195Bank premises and equipment
    
    
    121,348
    
    
    
    
    
    
    
    121,197
    
    
    
    
    
    
    
    120,902Investment security fair value adjustment
    
    
    (3,305
    )
    
    
    
    
    
    
    (3,159
    )
    
    
    
    
    
    
    18,974Other nonearning assets
    
    
    278,550
    
    
    
    
    
    
    
    274,197
    
    
    
    
    
    
    
    268,861Allowance for loan losses
    
    
    (116,151
    )
    
    
    
    
    
    
    (118,215
    )
    
    
    
    
    
    
    (121,267
    )Total assets
    
    $
    7,653,865
    
    
    
    
    
    
    $
    7,753,880
    
    
    
    
    
    
    $
    7,728,462Interest-Bearing LiabilitiesDeposits:Interest-bearing demand
    
    $
    857,273
    
    
    
    0.64
    
    
    $
    904,447
    
    
    
    0.64
    
    
    $
    1,153,239
    
    
    
    0.70Savings deposits
    
    
    1,448,866
    
    
    
    2.23
    
    
    
    1,414,788
    
    
    
    1.84
    
    
    
    1,626,232
    
    
    
    1.27Time deposits
    
    
    2,281,926
    
    
    
    3.85
    
    
    
    2,036,321
    
    
    
    3.52
    
    
    
    1,662,673
    
    
    
    2.68Short-term borrowings
    
    
    390,307
    
    
    
    3.88
    
    
    
    740,423
    
    
    
    3.79
    
    
    
    717,971
    
    
    
    2.51Long-term debt
    
    
    1,004,948
    
    
    
    4.10
    
    
    
    957,596
    
    
    
    4.02
    
    
    
    927,497
    
    
    
    3.67Total interest-bearing liabilities
    
    
    5,983,320
    
    
    
    3.04
    
    
    
    6,053,575
    
    
    
    2.81
    
    
    
    6,087,612
    
    
    
    2.06Noninterest-Bearing Liabilities and Shareholders EquityNoninterest-bearing demand
    
    
    924,788
    
    
    
    
    
    
    
    949,795
    
    
    
    
    
    
    
    906,615Other liabilities
    
    
    91,150
    
    
    
    
    
    
    
    96,857
    
    
    
    
    
    
    
    84,766Shareholders equity
    
    
    654,607
    
    
    
    
    
    
    
    653,653
    
    
    
    
    
    
    
    649,469Total liabilities and shareholders equity
    
    $
    7,653,865
    
    
    
    
    
    
    $
    7,753,880
    
    
    
    
    
    
    $
    7,728,462Interest Spread
    
    
    
    
    
    
    3.45
    %
    
    
    
    
    
    
    3.46
    %
    
    
    
    
    
    
    3.62
    %Contribution of noninterest bearing sources of funds
    
    
    
    
    
    
    0.52
    
    
    
    
    
    
    
    0.49
    
    
    
    
    
    
    
    0.34Net Interest Income as a Percent of Earning Assets
    
    
    
    
    
    
    3.97
    %
    
    
    
    
    
    
    3.95
    %
    
    
    
    
    
    
    3.96
    %
 
 (1)
    
    Average rates are presented on an annual basis and include taxable equivalent adjustments to interest income.(2)
    
    Certain amounts have been reclassified to conform with current year presentation.(3)
    
    For presentation in this table, average balances and the corresponding average rates for investment securities are based upon historical cost, adjusted for
amortization of premiums and accretion of discounts.(4)
    
    Nonaccrual loans are included in average balances. 13




---



##### 



Nonperforming Assets
Citizens Banking Corporation and Subsidiaries
 Three Months EndedMar 31
    
    
    Dec 31
    
    
    Sep 30
    
    
    Jun 30
    
    
    Mar 31(in thousands)
    
    2006
    
    
    2005
    
    
    2005
    
    
    2005
    
    
    2005Commercial(1)Commercial
    
    $
    10,594
    
    
    $
    11,880
    
    
    $
    14,457
    
    
    $
    17,903
    
    
    $
    12,991Commercial real estate
    
    
    5,219
    
    
    
    5,068
    
    
    
    5,720
    
    
    
    9,692
    
    
    
    11,004Total commercial
    
    
    15,813
    
    
    
    16,948
    
    
    
    20,177
    
    
    
    27,595
    
    
    
    23,995Consumer:Direct
    
    
    3,911
    
    
    
    4,326
    
    
    
    4,459
    
    
    
    3,726
    
    
    
    3,474Indirect
    
    
    569
    
    
    
    2,454
    
    
    
    962
    
    
    
    1,042
    
    
    
    1,025Residential mortgage
    
    
    7,396
    
    
    
    8,412
    
    
    
    9,929
    
    
    
    9,828
    
    
    
    8,099Loans 90 days or more past due and still accruing
    
    
    547
    
    
    
    385
    
    
    
    92
    
    
    
    2
    
    
    
    11Restructured loans
    
    
    1,844
    
    
    
    
    
    
    
    13
    
    
    
    32
    
    
    
    42Total Nonperforming Loans
    
    
    30,080
    
    
    
    32,525
    
    
    
    35,632
    
    
    
    42,225
    
    
    
    36,646Other Repossessed Assets Acquired
    
    
    6,397
    
    
    
    7,351
    
    
    
    6,984
    
    
    
    6,817
    
    
    
    7,118Total Nonperforming Assets
    
    $
    36,477
    
    
    $
    39,876
    
    
    $
    42,616
    
    
    $
    49,042
    
    
    $
    43,764(1) Changes in commercial nonperforming loans (including restructured loans) for the quarter (in millions):Inflows
    
    $
    9.8
    
    
    $
    10.6
    
    
    $
    9.9
    
    
    $
    21.1
    
    
    $
    11.2Outflows
    
    
    (9.1
    )
    
    
    (13.8
    )
    
    
    (17.3
    )
    
    
    (17.5
    )
    
    
    (15.4
    )Net change
    
    $
    0.7
    
    
    $
    (3.2
    )
    
    $
    (7.4
    )
    
    $
    3.6
    
    
    $
    (4.2
    )
 Summary of Loan Loss Experience
Citizens Banking Corporation and Subsidiaries
 Three Months EndedMar 31
    
    
    Dec 31
    
    
    Sep 30
    
    
    Jun 30
    
    
    Mar 31(in thousands)
    
    2006
    
    
    2005
    
    
    2005
    
    
    2005
    
    
    2005Allowance for loan losses  beginning of period
    
    $
    116,400
    
    
    $
    118,626
    
    
    $
    119,967
    
    
    $
    120,945
    
    
    $
    122,184Provision for loan losses
    
    
    3,000
    
    
    
    (7,287
    )
    
    
    4,000
    
    
    
    1,396
    
    
    
    3,000Charge-offs:Commercial
    
    
    921
    
    
    
    2,068
    
    
    
    1,912
    
    
    
    2,722
    
    
    
    2,463Commercial real estate
    
    
    616
    
    
    
    912
    
    
    
    1,965
    
    
    
    200
    
    
    
    678Total commercial
    
    
    1,537
    
    
    
    2,980
    
    
    
    3,877
    
    
    
    2,922
    
    
    
    3,141Residential mortgage
    
    
    198
    
    
    
    519
    
    
    
    182
    
    
    
    127
    
    
    
    324Direct consumer
    
    
    1,669
    
    
    
    1,382
    
    
    
    1,257
    
    
    
    1,227
    
    
    
    1,424Indirect consumer
    
    
    2,829
    
    
    
    3,075
    
    
    
    2,640
    
    
    
    1,534
    
    
    
    2,236Total charge-offs
    
    
    6,233
    
    
    
    7,956
    
    
    
    7,956
    
    
    
    5,810
    
    
    
    7,125Recoveries:Commercial
    
    
    1,175
    
    
    
    11,914
    
    
    
    1,334
    
    
    
    2,117
    
    
    
    1,162Commercial real estate
    
    
    79
    
    
    
    28
    
    
    
    232
    
    
    
    227
    
    
    
    707Total commercial
    
    
    1,254
    
    
    
    11,942
    
    
    
    1,566
    
    
    
    2,344
    
    
    
    1,869Residential mortgage
    
    
    55
    
    
    
    37
    
    
    
    32
    
    
    
    
    
    
    
    Direct consumer
    
    
    285
    
    
    
    329
    
    
    
    370
    
    
    
    377
    
    
    
    343Indirect consumer
    
    
    662
    
    
    
    709
    
    
    
    647
    
    
    
    715
    
    
    
    674Total recoveries
    
    
    2,256
    
    
    
    13,017
    
    
    
    2,615
    
    
    
    3,436
    
    
    
    2,886Net charge-offs
    
    
    3,977
    
    
    
    (5,061
    )
    
    
    5,341
    
    
    
    2,374
    
    
    
    4,239Allowance for loan losses  end of period
    
    $
    115,423
    
    
    $
    116,400
    
    
    $
    118,626
    
    
    $
    119,967
    
    
    $
    120,945Reserve for loan commitments  end of period
    
    $
    2,684
    
    
    $
    3,023
    
    
    $
    3,023
    
    
    $
    2,868
    
    
    $
    2,596
 Three Months Ended March 31, 2006Commercial
    
    
    Residential
    
    
    Direct
    
    
    Indirect(in thousands)
    
    Commercial
    
    
    real estate
    
    
    mortgage
    
    
    consumer
    
    
    consumer
    
    
    TotalCharge-offs:Michigan
    
    $
    620
    
    
    $
    509
    
    
    $
    158
    
    
    $
    1,374
    
    
    $
    2,829
    
    
    $
    5,490Wisconsin
    
    
    301
    
    
    
    107
    
    
    
    39
    
    
    
    259
    
    
    
    
    
    
    
    706Iowa
    
    
    
    
    
    
    
    
    
    
    1
    
    
    
    36
    
    
    
    
    
    
    
    37Total charge-offs
    
    
    921
    
    
    
    616
    
    
    
    198
    
    
    
    1,669
    
    
    
    2,829
    
    
    
    6,233Recoveries:Michigan
    
    
    346
    
    
    
    30
    
    
    
    43
    
    
    
    239
    
    
    
    662
    
    
    
    1,320Wisconsin
    
    
    825
    
    
    
    49
    
    
    
    8
    
    
    
    40
    
    
    
    
    
    
    
    922Iowa
    
    
    4
    
    
    
    
    
    
    
    4
    
    
    
    6
    
    
    
    
    
    
    
    14Total recoveries
    
    
    1,175
    
    
    
    79
    
    
    
    55
    
    
    
    285
    
    
    
    662
    
    
    
    2,256Net charge-offs
    
    $
    (254
    )
    
    $
    537
    
    
    $
    143
    
    
    $
    1,384
    
    
    $
    2,167
    
    
    $
    3,977
 14