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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 (the "EXCHANGE ACT") for the fiscal year ended
December 31, 2001
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE EXCHANGE ACT
for the transition period from __________ to ____________
Commission file number 1-10000
WACHOVIA CORPORATION
(Exact name of registrant as specified in its charter)
NORTH CAROLINA 56-0898180
(State of incorporation) (I.R.S. Employer Identification No.)
ONE WACHOVIA CENTER
CHARLOTTE, NC 28288-0013
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (704) 374-6565
Securities registered pursuant to Section 12(b) of the Exchange Act:
TITLE OF EACH CLASS NAME OF EXCHANGE ON WHICH REGISTERED
- --------------------------------- ------------------------------------------
Common Stock, $3.33 1/3 par value New York Stock Exchange, Inc. (the "NYSE")
(including attached rights)
Securities registered pursuant to Section 12(g) of the Exchange Act:
TITLE OF EACH CLASS
--------------------------------------
Dividend Equalization Preferred shares
no par value
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Exchange Act during the preceding 12
months (or for such shorter period that the registrant was required to file such
reports), and (2) has been subject to such filing requirements for the past 90
days. Yes [X] No [ ]
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [ ]
APPLICABLE ONLY TO REGISTRANTS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS:
Indicate by check mark whether the registrant has filed all documents and
reports required to be filed by Section 12, 13 or 15(d) of the Exchange Act
subsequent to the distribution of securities under a plan confirmed by a court.
Yes [ ] No [ ]
APPLICABLE ONLY TO CORPORATE REGISTRANTS
As of January 31, 2002, there were 1,362,460,464 shares of the registrant's
common stock outstanding, $3.33 1/3 par value per share, and based on the last
reported sale price of $33.25 per share on the NYSE on such date, the aggregate
market value of the registrant's common stock held by those persons deemed by
the registrant to be non-affiliates was approximately $45 billion.
DOCUMENTS INCORPORATED BY REFERENCE IN FORM 10-K
INCORPORATED DOCUMENTS WHERE INCORPORATED IN FORM 10-K
---------------------- --------------------------------
1. Certain portions of the Corporation's Annual Part I -- Items 1 and 2; Part II -- Items 5, 6, 7, 7A and 8.
Report to Stockholders for the year ended
December 31, 2001 ("Annual Report").
2. Certain portions of the Corporation's Proxy Part III -- Items 10, 11, 12 and 13.
Statement for the Annual Meeting of Stockholders
to be held on April 16, 2002 ("Proxy Statement").
PART I
Wachovia Corporation (formerly named First Union Corporation, "Wachovia") may
from time to time make written or oral forward-looking statements, including
statements contained in Wachovia's filings with the Securities and Exchange
Commission (including this Annual Report on Form 10-K and the Exhibits hereto
and thereto), in its reports to stockholders and in other Wachovia
communications, which Wachovia makes in good faith pursuant to the "safe harbor"
provisions of the Private Securities Litigation Reform Act of 1995.
These forward-looking statements include, among others, statements with respect
to Wachovia's beliefs, plans, objectives, goals, guidelines, expectations,
financial condition, results of operations, future performance and business of
Wachovia, including without limitation, (i) statements relating to the benefits
of the merger between the former Wachovia Corporation ("Legacy Wachovia") and
Wachovia completed on September 1, 2001 (the "Merger"), including future
financial and operating results, cost savings, enhanced revenues, and the
accretion to reported earnings thay may be realized from the Merger, (ii)
statements regarding certain of Wachovia's goals and expectations with respect
to earnings, earnings per share, revenue, expenses, and the growth rate in such
items, as well as other measures of economic performance, including statements
relating to estimates of credit quality trends, and (iii) statements preceded
by, followed by or that include the words "may", "could", "should", "would",
"believe", "anticipate", "estimate", "expect", "intend", "plan", "projects",
"outlook" or similar expressions. These forward-looking statements involve
certain risks and uncertainties that are subject to change based on various
factors (many of which are beyond Wachovia's control). The following factors,
among others, could cause Wachovia's financial performance to differ materially
from that expressed in such forward-looking statements: (1) the risk that the
businesses of Wachovia and Legacy Wachovia in connection with the Merger will
not be integrated successfully or such integration may be more difficult,
time-consuming or costly than expected; (2) expected revenue synergies and cost
savings from the Merger may not be fully realized or realized within the
expected time frame; (3) revenues following the Merger may be lower than
expected; (4) deposit attrition, operating costs, customer loss and business
disruption following the Merger, including, without limitation, difficulties in
maintaining relationships with employees, may be greater than expected; (5) the
strength of the United States economy in general and the strength of the local
economies in which Wachovia conducts operations may be different than expected
resulting in, among other things, a deterioration in credit quality or a reduced
demand for credit, including the resultant effect on Wachovia's loan portfolio
and allowance for loan losses; (6) the effects of, and changes in, trade,
monetary and fiscal policies and laws, including interest rate policies of the
Board of Governors of the Federal Reserve System; (7) inflation, interest rate,
market and monetary fluctuations; (8) adverse conditions in the stock market,
the public debt market and other capital markets (including changes in interest
rate conditions) and the impact of such conditions on Wachovia's capital markets
and capital management activities, including, without limitation, Wachovia's
mergers and acquisition advisory business, equity and debt underwriting
activities, private equity investment activities, derivative securities
activities, investment and wealth management advisory businesses, and brokerage
activities; (9) the timely development of competitive new products and services
by Wachovia and the acceptance of these products and services by new and
existing customers; (10) the willingness of customers to accept third party
products marketed by Wachovia; (11) the willingness of customers to substitute
competitors' products and services for Wachovia's products and services and vice
versa; (12) the impact of changes in financial services laws and regulations
(including laws concerning taxes, banking, securities and insurance); (13)
technological changes; (14) changes in consumer spending and saving habits; (15)
the effect of corporate restructurings, acquisitions and/or dispositions,
including, without limitation, the Merger, and the actual restructuring and
other charges related thereto, and the failure to achieve the expected revenue
growth and/or expense savings from such corporate restructurings, acquisitions
and/or dispositions; (16) the growth and profitability of Wachovia's
non-interest or fee income being less than expected; (17) unanticipated
regulatory or judicial proceedings; (18) the impact of changes in accounting
policies by the Securities and Exchange Commission; (19) adverse changes in
financial performance and/or condition of Wachovia's borrowers which could
impact repayment of such borrowers' outstanding loans; (20) the impact on
Wachovia's businesses, as well as on the risks set forth above, of various
domestic or international military or terrorist activities or conflicts; and
(21) Wachovia's success at managing the risks involved in the foregoing.
Wachovia cautions that the foregoing list of important factors is not exclusive.
Wachovia incorporates by reference those factors included in our previously
filed current reports on Form 8-K. Wachovia does not undertake to update any
forward-looking statement, whether written or oral, that may be made from time
to time by or on behalf of Wachovia.
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ITEM 1. BUSINESS.
GENERAL
Wachovia Corporation (formerly named First Union Corporation, "Wachovia") was
incorporated under the laws of North Carolina in 1967 and is registered as a
financial holding company and a bank holding company under the Bank Holding
Company Act of 1956, as amended. Pursuant to a corporate reorganization in 1968,
a predecessor of First Union National Bank ("FUNB") and First Union Mortgage
Corporation, a mortgage banking firm acquired in 1964, became our subsidiaries.
The merger of Wachovia Corporation ("Legacy Wachovia") and First Union
Corporation ("Legacy First Union") was effective September 1, 2001. Legacy First
Union changed its name to "Wachovia Corporation" on the date of the merger. As
the surviving corporate entity in the merger, information contained in this
Annual Report on Form 10-K, unless indicated otherwise, includes information
about Legacy First Union only. Whenever we use the "Wachovia" name in this
Annual Report on Form 10-K, we mean the new combined company and, before the
merger, Legacy First Union, unless indicated otherwise.
We provide a wide range of commercial and retail banking and trust services
through full-service banking offices in Connecticut, Delaware, Florida, Georgia,
Maryland, New Jersey, New York, North Carolina, Pennsylvania, South Carolina,
Virginia and Washington, D.C. FUNB, based in Charlotte, North Carolina, operates
those offices, except in Delaware, where First Union National Bank of Delaware
operates the offices. In addition, Wachovia Bank, National Association ("WBNA"),
based in Winston-Salem, North Carolina, operates retail banking and trust
services through full-service banking offices in Florida, Georgia, North
Carolina, South Carolina and Virginia. We expect to merge FUNB and WBNA on or
around April 1, 2002, and the name of the surviving bank shall be "Wachovia
Bank, National Association". We also provide various other financial services,
including mortgage banking, credit card, investment banking, investment
advisory, home equity lending, asset-based lending, leasing, insurance,
international and securities brokerage services, through other subsidiaries.
Our principal executive offices are located at One Wachovia Center, 301 South
College Street, Charlotte, North Carolina 28288-0013 (telephone number (704)
374-6565).
Since the 1985 Supreme Court decision upholding regional interstate banking
legislation, we have concentrated our efforts on building a large, diversified
financial services organization, primarily doing business in the eastern region
of the United States. Since November 1985, Legacy First Union has completed over
90 banking-related acquisitions.
With the completion of our merger with Legacy Wachovia, we are focused on
generating improved core earnings growth from our four key businesses, including
Capital Management, the General Bank, Wealth Management and Corporate &
Investment Banking. We are focused on integrating Legacy Wachovia and Legacy
First Union's business operations over a planned three-year integration period.
We will continue to evaluate our operations and organizational structures to
ensure they are closely aligned with our goal of maximizing performance in our
core business lines. When consistent with our overall business strategy, we may
consider the disposition of certain assets, branches, subsidiaries or lines of
business. We routinely explore acquisition opportunities, particularly in areas
that would complement our core business lines, and frequently conduct due
diligence activities in connection with possible acquisitions. As a result,
acquisition discussions and, in some cases, negotiations frequently take place
and future acquisitions involving cash, debt or equity securities can be
expected.
Additional information relating to our businesses and our subsidiaries is
included in the information set forth on pages 20 through 24 and in Note 11 on
pages 91 through 93 in the Annual Report and incorporated herein by reference.
Information relating to Wachovia Corporation only is set forth in Note 17 on
pages 104 through 107 in the Annual Report and incorporated herein by reference.
COMPETITION
Our subsidiaries face substantial competition in their operations from banking
and non-banking institutions, including savings and loan associations, credit
unions, money market funds and other investment vehicles, mutual fund advisory
companies, brokerage firms, insurance companies, leasing companies, credit card
issuers, mortgage banking companies, investment banking companies, finance
companies and other types of financial services providers, including
Internet-only financial service providers.
SUPERVISION AND REGULATION
The following discussion sets forth some of the material elements of the
regulatory framework applicable to financial
3
holding companies and bank holding companies and their subsidiaries and provides
some specific information relevant to us. The regulatory framework is intended
primarily for the protection of depositors and the Federal Deposit Insurance
Funds and not for the protection of security holders. To the extent that the
following information describes statutory and regulatory provisions, it is
qualified in its entirety by reference to the particular statutory and
regulatory provisions. A change in applicable statutes, regulations or
regulatory policy may have a material effect on our business.
GENERAL
As a financial holding company and a bank holding company, Wachovia is subject
to regulation under the Bank Holding Company Act and its examination and
reporting requirements. The earnings of our subsidiaries, and therefore our
earnings, are affected by general economic conditions, management policies and
the legislative and governmental actions of various regulatory authorities,
including the Federal Reserve Board, the Comptroller of the Currency (the
"Comptroller") and the Federal Deposit Insurance Corporation (the "FDIC"). In
addition, there are numerous governmental requirements and regulations which
affect our activities and the activities of our subsidiaries.
PAYMENT OF DIVIDENDS
Wachovia Corporation is a legal entity separate and distinct from its banking
and other subsidiaries. A major portion of our revenues result from amounts paid
as dividends to us by our national bank subsidiaries. The Comptroller's prior
approval is required if the total of all dividends declared by a national bank
in any calendar year will exceed the sum of that bank's net profits for that
year and its retained net profits for the preceding two calendar years, less any
required transfers to surplus. Federal law also prohibits national banks from
paying dividends which would be greater than the bank's undivided profits after
deducting statutory bad debt in excess of the bank's allowance for loan losses.
Under the foregoing dividend restrictions and certain restrictions applicable to
certain of our non-banking subsidiaries, as of December 31, 2001, our
subsidiaries, without obtaining affirmative governmental approvals, could pay
aggregate dividends of $999 million to us during 2002. In 2001, our subsidiaries
paid $1.6 billion in cash dividends to us.
In addition, we and our banking subsidiaries are subject to various general
regulatory policies and requirements relating to the payment of dividends,
including requirements to maintain adequate capital above regulatory minimums.
The appropriate federal regulatory authority is authorized to determine under
certain circumstances relating to the financial condition of a bank or bank
holding company that the payment of dividends would be an unsafe or unsound
practice and to prohibit payment thereof. The appropriate federal regulatory
authorities have indicated that paying dividends that deplete a bank's capital
base to an inadequate level would be an unsound and unsafe banking practice and
that banking organizations should generally pay dividends only out of current
operating earnings.
BORROWINGS
There are also various legal restrictions on the extent to which we and our
non-bank subsidiaries can borrow or otherwise obtain credit from our banking
subsidiaries. In general, these restrictions require that any such extensions of
credit must be secured by designated amounts of specified collateral and are
limited, as to any one of us or those non-bank subsidiaries, to 10% of the
lending bank's capital stock and surplus, and as to us and all non-bank
subsidiaries in the aggregate, to 20% of such lending bank's capital stock and
surplus.
CAPITAL ADEQUACY
Under the risk-based capital requirements for bank holding companies, the
minimum requirement for the ratio of capital to risk-weighted assets (including
certain off-balance-sheet activities, such as standby letters of credit) is 8%.
At least half of the total capital (as defined below) is to be composed of
common stockholders' equity, retained earnings, a limited amount of qualifying
perpetual preferred stock and minority interests in the equity accounts of
consolidated subsidiaries, less goodwill and certain intangibles ("tier 1
capital"). The remainder of total capital may consist of mandatory convertible
debt securities and a limited amount of subordinated debt, qualifying preferred
stock and loan loss allowance ("tier 2 capital", and together with tier 1
capital, "total capital"). At December 31, 2001, our tier 1 capital and total
capital ratios were 7.04% and 11.08%, respectively.
In addition, the Federal Reserve Board has established minimum leverage ratio
guidelines for bank holding companies. These requirements provide for a minimum
leverage ratio of tier 1 capital to adjusted average quarterly assets less
certain amounts ("leverage ratio") equal to 3% for bank holding companies that
meet certain specified
4
criteria, including having the highest regulatory rating. All other bank holding
companies will generally be required to maintain a leverage ratio of at least
4%. Our leverage ratio at December 31, 2001, was 6.19%. The guidelines also
provide that bank holding companies experiencing internal growth or making
acquisitions will be expected to maintain strong capital positions substantially
above the minimum supervisory levels without significant reliance on intangible
assets. Furthermore, the guidelines indicate that the Federal Reserve Board will
continue to consider a "tangible tier 1 leverage ratio" (deducting all
intangibles) in evaluating proposals for expansion or to engage in new activity.
The Federal Reserve Board has not advised us of any specific minimum leverage
ratio or tier 1 leverage ratio applicable to us.
Each of our subsidiary banks is subject to similar capital requirements adopted
by the Comptroller or other applicable regulatory agency. Neither the
Comptroller nor such applicable regulatory agency has advised any of our
subsidiary banks of any specific minimum leverage ratios applicable to it. The
capital ratios of our bank subsidiaries are set forth in Table 17 on page 53 in
the Annual Report and incorporated herein by reference.
SUPPORT OF SUBSIDIARY BANKS
The Federal Deposit Insurance Act, as amended ("FDIA"), among other things,
imposes liability on an institution the deposits of which are insured by the
FDIC, such as our subsidiary banks, for certain potential obligations to the
FDIC incurred in connection with other FDIC-insured institutions under common
control with such institution.
Under the National Bank Act, if the capital stock of a national bank is impaired
by losses or otherwise, the Comptroller is authorized to require payment of the
deficiency by assessment upon the bank's stockholders, pro rata, and to the
extent necessary, if any such assessment is not paid by any stockholder after
three months notice, to sell the stock of such stockholder to make good the
deficiency. Under Federal Reserve Board policy, we are expected to act as a
source of financial strength to each of our subsidiary banks and to commit
resources to support each of those subsidiaries. This support may be required at
times when, absent such Federal Reserve Board policy, we may not find ourselves
able to provide it.
Any capital loans by a bank holding company to any of its subsidiary banks are
subordinate in right of payment to deposits and to certain other indebtedness of
such subsidiary banks. In the event of a bank holding company's bankruptcy, any
commitment by the bank holding company to a federal bank regulatory agency to
maintain the capital of a subsidiary bank will be assumed by the bankruptcy
trustee and entitled to a priority of payment.
PROMPT CORRECTIVE ACTION
The FDIA, among other things, requires the federal banking agencies to take
"prompt corrective action" in respect of depository institutions that do not
meet minimum capital requirements. FDIA establishes five capital tiers: "well
capitalized", "adequately capitalized", "undercapitalized", "significantly
undercapitalized" and "critically undercapitalized". A depository institution's
capital tier will depend upon where its capital levels compare to various
relevant capital measures and certain other factors, as established by
regulation.
Federal regulatory authorities have adopted regulations establishing relevant
capital measures and relevant capital levels applicable to FDIC-insured banks.
The relevant capital measures are the total capital ratio, the tier 1 capital
ratio and the leverage ratio. Under the regulations, an FDIC-insured bank will
be: (i) "well capitalized" if it has a total capital ratio of 10% or greater, a
tier 1 capital ratio of 6% or greater and a leverage ratio of 5% or greater and
is not subject to any order or written directive by any such regulatory
authority to meet and maintain a specific capital level for any capital measure;
(ii) "adequately capitalized" if it has a total capital ratio of 8% or greater,
a tier 1 capital ratio of 4% or greater and a leverage ratio of 4% or greater
(3% in certain circumstances) and is not "well capitalized"; (iii)
"undercapitalized" if it has a total capital ratio of less than 8%, a tier 1
capital ratio of less than 4% or a leverage ratio of less than 4% (3% in certain
circumstances); (iv) "significantly undercapitalized" if it has a total capital
ratio of less than 6%, a tier 1 capital ratio of less than 3% or a leverage
ratio of less than 3%; and (v) "critically undercapitalized" if its tangible
equity is equal to or less than 2% of average quarterly tangible assets. An
institution may be downgraded to, or deemed to be in, a capital category that is
lower than is indicated by its capital ratios if it is determined to be in an
unsafe or unsound condition or if it receives an unsatisfactory examination
rating with respect to certain matters. As of December 31, 2001, all of our
deposit-taking subsidiary banks had capital levels that qualify them as being
"well capitalized" under those regulations.
The FDIA generally prohibits an FDIC-insured depository institution from making
any capital distribution (including payment of a dividend) or paying any
management fee to its holding company if the depository institution would
thereafter be "undercapitalized". "Undercapitalized" depository institutions are
subject to growth limitations and are
5
required to submit a capital restoration plan. The federal banking agencies may
not accept a capital plan without determining, among other things, that the plan
is based on realistic assumptions and is likely to succeed in restoring the
depository institution's capital. In addition, for a capital restoration plan to
be acceptable, the depository institution's parent holding company must
guarantee that the institution will comply with such capital restoration plan.
The aggregate liability of the parent holding company is limited to the lesser
of (i) an amount equal to 5% of the depository institution's total assets at the
time it became "undercapitalized", and (ii) the amount which is necessary (or
would have been necessary) to bring the institution into compliance with all
capital standards applicable with respect to such institution as of the time it
fails to comply with the plan. If a depository institution fails to submit an
acceptable plan, it is treated as if it is "significantly undercapitalized".
"Significantly undercapitalized" depository institutions may be subject to a
number of requirements and restrictions, including orders to sell sufficient
voting stock to become "adequately capitalized", requirements to reduce total
assets and cessation of receipt of deposits from correspondent banks.
"Critically undercapitalized" institutions are subject to the appointment of a
receiver or conservator. A bank that is not "well capitalized" is subject to
certain limitations relating to so-called "brokered" deposits.
DEPOSITOR PREFERENCE STATUTE
Under federal law, deposits and certain claims for administrative expenses and
employee compensation against an insured depository institution would be
afforded a priority over other general unsecured claims against such an
institution, including federal funds and letters of credit, in the "liquidation
or other resolution" of such an institution by any receiver.
INTERSTATE BANKING AND BRANCHING LEGISLATION
The Reigle-Neal Interstate Banking and Branching Efficiency Act of 1994 (the
"IBBEA"), authorized interstate acquisitions of banks and bank holding companies
without geographic limitation beginning one year after enactment. In addition,
it authorized, beginning June 1, 1997, a bank to merge with a bank in another
state as long as neither of the states opted out of interstate branching between
the date of enactment of the IBBEA and May 31, 1997. In addition, a bank may
establish and operate a de novo branch in a state in which the bank does not
maintain a branch if that state expressly permits de novo branching. It was
pursuant to authority from IBBEA that we reorganized certain of our subsidiary
banks in 1997 and in February 1998, as a result of which FUNB, based in
Charlotte, North Carolina, operates in 10 states and Washington, D.C. In
addition, on April 1, 2002, we plan to merge FUNB and WBNA pursuant to this
statutory authorization.
FINANCIAL MODERNIZATION ACT OF 1999
The Gramm-Leach-Bliley Financial Modernization Act of 1999 was enacted on
November 12, 1999. The Modernization Act:
- allows bank holding companies meeting management, capital and
CRA standards to engage in a substantially broader range of
nonbanking activities than was permissible prior to enactment,
including insurance underwriting and making merchant banking
investments in commercial and financial companies;
- allows insurers and other financial services companies to
acquire banks;
- removes various restrictions that applied to bank holding
company ownership of securities firms and mutual fund advisory
companies; and
- establishes the overall regulatory structure applicable to
bank holding companies that also engage in insurance and
securities operations.
This part of the Modernization Act became effective on March 11, 2000. The
Federal Reserve Board notified us that, effective March 13, 2000, we are
authorized to operate as a financial holding company and therefore are eligible
to engage in the broader range of activities that are permitted by the
Modernization Act. The Modernization Act will also modify other current
financial laws, including laws related to financial privacy and community
reinvestment. The new financial privacy provisions will generally prohibit
financial institutions, including us, from disclosing nonpublic personal
financial information to nonaffiliated third parties unless customers have the
opportunity to "opt out" of the disclosure.
INTERNATIONAL MONEY LAUNDERING ABATEMENT AND FINANCIAL ANTI-TERRORISM ACT
OF 2001
6
On October 26, 2001, the President signed the USA Patriot Act of 2001 into law.
This act contains the International Money Laundering Abatement and Financial
Anti-Terrorism Act of 2001 (the "IMLAFA"). The IMLAFA contains anti-money
laundering measures affecting insured depository institutions, broker-dealers
and certain other financial institutions. The IMLAFA requires U.S. financial
institutions to adopt new policies and procedures to combat money laundering and
grants the Secretary of the Treasury broad authority to establish regulations
and to impose requirements and restrictions on financial institutions'
operations. As of the date of this filing, we have not determined the impact
that IMLAFA will have on Wachovia's operations but the impact is not expected to
be material. Wachovia will establish policies and procedures to ensure
compliance with the IMLAFA.
ADDITIONAL INFORMATION
Additional information related to certain accounting and regulatory matters is
set forth on pages 35 through 37 in the Annual Report and incorporated herein by
reference.
ITEM 2. PROPERTIES.
As of December 31, 2001, we and our subsidiaries owned 1,654 locations and
leased 3,842 locations in 48 states, Washington, D.C., Puerto Rico and 27
foreign countries from which our business is conducted, including a
multi-building office complex in Charlotte, North Carolina, which serves as our
administrative headquarters. Additional information relating to our lease
commitments is set forth in Note 16 on page 103 in the Annual Report and
incorporated herein by reference.
ITEM 3. LEGAL PROCEEDINGS.
We and certain of our subsidiaries have been named as defendants in various
legal actions arising from their normal business activities in which varying
amounts are claimed. Although the amount of any ultimate liability with respect
to those matters cannot be determined, in management's opinion, based upon the
opinions of counsel, any such liability will not have a material effect on our
and our subsidiaries' consolidated financial position or results of operations.
A number of purported class actions were filed in June through August 1999
against us in the United States District Courts for the Western District of
North Carolina and for the Eastern District of Pennsylvania. These actions named
us and certain of our executive officers as defendants and were purported to be
on behalf of persons who purchased shares of our common stock from August 14,
1998, through May 24, 1999. These actions were consolidated into one case in the
U.S. District Court for the Western District of North Carolina in October 1999.
These complaints alleged various violations of federal securities law, including
violations of Section 10(b) of the Exchange Act, and that the defendants made
materially misleading statements and/or material omissions which artificially
inflated prices for our common stock. The complaints alleged that management
failed to disclose integration problems in the CoreStates Financial Corp merger
and misstated the value of our interest in certain mortgage-backed securities of
The Money Store, Inc. ("TMSI") acquired by Legacy First Union on June 30, 1998.
Plaintiffs sought a judgment awarding damages and other relief. On January 10,
2001, the U.S. District Court for the Western District of North Carolina granted
our motion to dismiss the litigation for failure to state a claim upon which
relief could be granted. Although the plaintiffs did not appeal this ruling,
they sought, and received permission to file an amended complaint. In August
2001, plaintiffs filed an amended complaint that abandoned their previous
allegations concerning the CoreStates Financial Corp merger and primarily raised
new allegations of irregularities at TMSI prior to its acquisition by Legacy
First Union. In October 2001, we filed a motion to dismiss this new complaint on
several grounds, including that the complaint is barred by the statute of
limitations. The court has not ruled on our motion to dismiss. We believe the
allegations contained in these actions are without merit and will vigorously
defend them. We believe that the ultimate outcome of this litigation will not
have a material adverse effect on our consolidated financial position.
On July 26, 2000, a jury in the Philadelphia County (PA) Court of Common Pleas
returned a verdict in the case captioned Pioneer Commercial Funding Corporation
v. American Financial Mortgage Corporation, CoreStates Bank, N.A., et al. The
verdict against CoreStates Bank, N.A. ("CoreStates"), a predecessor of First
Union National Bank, included consequential damages of $13.5 million and
punitive damages of $337.5 million. The trial court had earlier directed a
verdict against CoreStates for compensatory damages of $1.7 million. The
plaintiff, who was not a CoreStates customer, alleged that the sum of $1.7
million, which it claims it owned, was improperly setoff by CoreStates. Upon our
motion, the trial court reduced the amount of the punitive damages award to
$40.5 million in December 2000. We believe that numerous reversible errors
occurred at the trial, and that the facts do not support the damages awards. We
appeared before the Pennsylvania Superior Court in November 2001 to argue our
appeal to reverse the trial court's decision and await the appellate court's
decision on our appeal. We will vigorously pursue our pending post-trial motions
and our right of appeal. We believe, after consultation with external counsel,
that the
7
ultimate outcome of this litigation will not have a material adverse effect on
our consolidated financial position.
A number of lawsuits have been filed in 2000 and 2001 against TMSI and certain
other affiliates in various jurisdictions. Substantially all of the plaintiffs
were borrowers of TMSI prior to our acquisition of TMSI in June 1998. The
borrower plaintiffs generally allege violations of federal and/or state law in
connection with TMSI lending activities. The plaintiffs in these lawsuits are
seeking compensatory and punitive damages and other relief. We will vigorously
defend the claims alleged in these cases. We believe that the ultimate outcome
of these cases, individually and in the aggregate, will not result in judgments
that would have a material adverse effect on our consolidated financial
position.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
Not applicable.
PART II
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.
Our common stock is listed on the NYSE. Table 5 on page 44 in the Annual Report
sets forth information relating to the quarterly prices of, and quarterly
dividends paid on, the common stock for the two-year period ended December 31,
2001, and incorporated herein by reference. Prices shown represent the high, low
and quarter-end sale prices of the common stock as reported on the NYSE
Composite Transactions tape for the periods indicated. As of December 31, 2001,
there were 191,231 holders of record of the common stock.
In connection with the merger with Legacy Wachovia, holders of shares of Legacy
Wachovia common stock elected to receive, in addition to 2 shares of Wachovia
common stock, either a one-time $0.48 cash payment or 2 shares of a new class of
Wachovia preferred stock. At December 31, 2001, 96,138,876 Wachovia Dividend
Equalization Preferred shares ("DEPs") were issued in connection with the
merger. The DEPs pay a quarterly dividend per share equal to the difference
between $0.30 and the quarterly dividend paid per share on Wachovia common
stock. The DEPs are not listed on a national securities exchange and have no
voting rights. Wachovia will cease to pay a dividend on the DEPs when Wachovia's
common stock dividend equals at least $1.20 per share in the aggregate for four
consecutive quarters.
Subject to the prior rights of holders of any outstanding shares of our
preferred stock or Class A preferred stock, holders of common stock are entitled
to receive such dividends as may be legally declared by our board of directors
and, in the event of dissolution and liquidation, to receive our net assets
remaining after payment of all liabilities, in proportion to their respective
holdings. Additional information concerning certain limitations on our payment
of dividends is set forth above under "Business -- Supervision and Regulation;
Payment of Dividends" and in Note 17 on page 104 in the Annual Report and
incorporated herein by reference.
Under our Shareholder Protection Rights Agreement, each outstanding common stock
share has a right attached to it. This right remains attached unless a
separation time occurs. At separation time, common shareholders will receive
separate certificates for these rights. Each right entitles its owner to
purchase at separation time one one-hundredth of a share of a participating
series of Class A preferred stock for $105. This series of Class A preferred
stock would have economic and voting terms similar to those of one common stock
share. Separation time would generally occur at the earlier of the following two
dates:
- the tenth business day after any person commences a tender or
exchange offer that entitles that person to 10% or more of our
outstanding common stock, or
- the tenth business day after we publicly announce that a
person has acquired beneficial ownership of 10% or more of our
outstanding common stock.
These rights will not trade separately from the shares of common stock until
separation time occurs, and may be exercised on the business day immediately
after the separation time. The rights will expire at the earliest of:
- the date on which our board of directors elects to exchange
the rights for our common stock or preferred stock as
described below;
- the close of business on December 28, 2010, unless our board
of directors extends that time; or
8
- the date on which the rights are terminated as described
below.
Once we publicly announce that a person has acquired 10% of our outstanding
common stock, we can allow for rights holders to buy our common stock for half
of its market value. For example, we would sell to each rights holder common
stock shares worth $210 for $105 in cash. At the same time, any rights held by
the 10% owner or any of its affiliates, associates or transferees will be void.
In addition, if we are acquired in a merger or other business combination after
a person has become a 10% owner, the rights held by shareholders would become
exercisable to purchase the acquiring company's common stock for half of its
market value.
In the alternative, our board of directors may elect to exchange all of the then
outstanding rights for shares of common stock at an exchange ratio of two common
stock shares for one right. Upon election of this exchange, a right will no
longer be exercisable and will only represent a right to receive two common
stock shares.
If we are required to issue common stock shares upon the exercise of rights, or
in exchange for rights, our board may substitute shares of participating Class A
preferred stock. The substitution will be at a rate of two one one-hundredths of
a share of participating Class A preferred stock for each right exchanged.
The rights may be terminated without any payment to holders before their
exercise date. The rights have no voting rights and are not entitled to
dividends.
The rights will not prevent a takeover of Wachovia. The rights, however, may
cause substantial dilution to a person or group that acquires 10% or more of
common stock unless our board first terminates the rights. Nevertheless, the
rights should not interfere with a transaction that is in Wachovia's and its
shareholders' best interests because the rights can be terminated by the board
before that transaction is completed.
The complete terms of the rights are contained in the Shareholder Protection
Rights Agreement. The foregoing description of the rights and the rights
agreement is qualified in its entirety by reference to the agreement. A copy of
the rights agreement can be obtained upon written request to First Union
National Bank, 1525 West W.T. Harris Blvd., Charlotte, North Carolina
28288-1153.
On November 1, 2001, Wachovia acquired The Rhodes Agency, Inc. In connection
with that acquisition, Wachovia issued an aggregate of 168,536 shares of
Wachovia common stock to the stockholder of Rhodes. The sale of the shares of
common stock by Wachovia were exempt from registration under the Securities Act
of 1933, as amended, pursuant to Section 4(2) thereof because the sale did not
involve a public offering.
Additional information relating to our common stock and the DEPs is set forth in
Note 10 on pages 88 through 90 in the Annual Report and incorporated herein by
reference.
ITEM 6. SELECTED FINANCIAL DATA.
In response to this Item, the information set forth in Table 2 on page 42 in the
Annual Report is incorporated herein by reference.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS.
In response to this Item, the information set forth on pages 16 through 62 in
the Annual Report is incorporated herein by reference.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
In response to this Item, the information set forth on pages 31 through 35, on
pages 45 through 47, on pages 54 through 57 and in Note 16 on pages 102 and 103
in the Annual Report is incorporated herein by reference.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.
In response to this Item, the information set forth in Table 5 on page 44 and on
pages 63 through 107 in the Annual Report is incorporated herein by reference.
9
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE.
Not applicable.
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT.
Our executive officers are generally elected to their offices for one year terms
at the board meeting in April of each year. The terms of any executive officers
elected after that date expire at the same time as the terms of the executive
officers elected on that date. Following the merger between Legacy Wachovia and
Legacy First Union, Wachovia elected certain Legacy Wachovia executives to be
executive officers of Wachovia. The names of each of our executive officers,
their ages, their positions with us, and, if different, their business
experience during the past five years, are as follows:
L. M. Baker, Jr. (59). Chairman, since September 2001. Previously,
Chairman (since 1998), Chief Executive Officer and President, Legacy
Wachovia, prior to September 1, 2001. Also, a director of the
Corporation.
G. Kennedy Thompson (51). Chief Executive Officer, since April 2000,
and President, since December 1999. Previously, Chairman, from March
2001 to September 2001, Vice Chairman, from October 1998 to December
1999, Executive Vice President, from November 1996 to October 1998.
Also, a director of the Corporation.
Robert S. McCoy, Jr. (63). Vice Chairman, since September 2001.
Previously, Vice Chairman and Chief Financial Officer, from April 1999
to September 2001, and Senior Executive Vice President and Chief
Financial Officer, prior to April 1999, Legacy Wachovia.
B. J. Walker (71). Vice Chairman.
David M. Carroll (44). Senior Executive Vice President, since September
2001. Previously, Executive Vice President and Chief E-Commerce
Officer, from May 1999 to September 2001, President and CEO, First
Union-Florida, from January 1998 to May 1999, and President and CEO,
First Union-Georgia, prior to December 1997.
Stephen E. Cummings (46). Senior Executive Vice President and Co-Head,
Corporate & Investment Banking, since February 2002. Previously, Senior
Vice President of First Union Securities, Inc. and Co-Head, Corporate &
Investment Banking, from January 2000 to February 2002, Co-Head,
Investment Banking from January 1999 to December 1999, and Chairman and
CEO, Bowles Hollowell Conner & Co., prior to April 1998.
Jean E. Davis (46). Senior Executive Vice President, since September
2001. Previously, Executive Vice President, Wachovia Operational
Services, from February 1999 to September 2001, Human Resources
Director, from February 1998 to February 1999, and prior to February
1998, Regional Executive-Piedmont Triad Region, Legacy Wachovia.
Malcolm E. Everett, III (55). Senior Executive Vice President, since
September 2001. Previously, President, First Union-Southwest Region,
from January 2001 to September 2001, President, First Union-Mid
Atlantic, from May 1999 to January 2001, Chairman, Chief Executive
Officer and President, First Union-Carolinas, from January 1998 to May
1999, and Chairman and Chief Executive Officer, First Union-North
Carolina, prior to January 1998.
Paul G. George (50). Senior Executive Vice President, since September
2001. Previously, Executive Vice President, Legacy Wachovia, prior to
September 2001.
W. Barnes Hauptfuhrer (47). Senior Executive Vice President and
Co-Head, Corporate & Investment Banking, since February 2002.
Previously, Senior Vice President of First Union Securities, Inc. and
Co-Head, Corporate & Investment Banking, from January 2000 to February
2002, Co-Head, Investment Banking from January 1999 to December 1999,
and Managing Partner and Head of First Union Capital Partners, Inc.,
prior to January 1999.
Benjamin P. Jenkins, III (57). Senior Executive Vice President, since
September 2001. Previously, Vice Chairman, from August 1999 to
September 2001, President, First Union-Florida, from June 1999 to
August 1999, and President, First Union-VA/MD/DC, prior to June 1999.
Robert P. Kelly (48). Senior Executive Vice President and Chief
Financial Officer, since September 2001. Previously, Executive Vice
President and Chief Financial Officer, from November 2000 to September
2001, Vice Chairman-
10
Group Office of Toronto Dominion Bank from February 2000 to July 2000,
Vice Chairman-Retail Banking from 1997 to February 2000, and Vice
Chairman from 1996 to 1997.
Stanhope A. Kelly (44). Senior Executive Vice President, since
September 2001. Previously, Senior Executive Vice President, from
January 2000 to September 2001, and Senior Vice President, prior to
January 2000, Legacy Wachovia.
Donald A. McMullen, Jr. (53). Senior Executive Vice President, since
September 2001. Previously, Vice Chairman, from August 1999 to
September 2001, and Executive Vice President prior to August 1999.
Mark C. Treanor (55). Senior Executive Vice President, Secretary and
General Counsel, since September 2001. Previously, Executive Vice
President, Secretary and General Counsel, from August 1999 to September
2001, Senior Vice President and Senior Deputy General Counsel, August
1998 to August 1999, and senior partner, Treanor, Pope & Hughes, prior
to August 1998.
Donald K. Truslow (43). Senior Executive Vice President, since
September 2001. Previously, Senior Executive Vice President and Chief
Risk Officer, from August 2000 to September 2001, and Comptroller and
Treasurer, prior to August 2000, Legacy Wachovia.
In addition to the foregoing, the information set forth in the Proxy Statement
under the heading "General Information and Nominees", and under the subheading
"Section 16(a) Beneficial Ownership Reporting Compliance" under the heading
"Other Matters Relating to Executive Officers and Directors" is incorporated
herein by reference.
ITEM 11. EXECUTIVE COMPENSATION.
In response to this Item, the information set forth in the Proxy Statement under
the heading "Executive Compensation", excluding the information under the
subheadings "Compensation Committee Report on Executive Compensation" and
"Performance Graph", is incorporated herein by reference.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.
In response to this Item, the information set forth in the Proxy Statement
relating to the ownership of common stock and DEPs by our directors, executive
officers and principal stockholders under the headings "Security Ownership of
Management" and "Security Ownership of Certain Beneficial Owners" is
incorporated herein by reference.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
In response to this Item, the information set forth in the Proxy Statement under
the heading "Other Matters Relating to Executive Officers and Directors" is
incorporated herein by reference.
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K.
(a) Our consolidated financial statements, including the notes thereto and
independent auditors' report thereon, are set forth on pages 63 through 107 of
the Annual Report, and are incorporated herein by reference. All financial
statement schedules are omitted since the required information is either not
applicable, is immaterial or is included in our consolidated financial
statements and notes thereto. A list of the exhibits to this Form 10-K is set
forth on the Exhibit Index immediately preceding such exhibits and is
incorporated herein by reference.
(b) During the quarter ended December 31, 2001, we filed the following Current
Reports on Form 8-K with the SEC: October 23, 2001. In addition, we filed the
following Current Report on Form 8-K with the SEC in the first quarter of 2002:
January 23, 2002.
11
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, the registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.
WACHOVIA CORPORATION
Date: March 14, 2002
BY: /s/ DAVID M. JULIAN
--------------------------------------
DAVID M. JULIAN
SENIOR VICE PRESIDENT
Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below by the following persons on behalf of the registrant and
in the capacities indicated and on the date indicated.
SIGNATURE CAPACITY
--------- --------
LESLIE M. BAKER, JR.* Chairman and Director
---------------------
LESLIE M. BAKER, JR.
G. KENNEDY THOMPSON* President, Chief Executive Officer and Director
--------------------
G. KENNEDY THOMPSON
ROBERT P. KELLY* Senior Executive Vice President and Chief
---------------- Financial Officer
ROBERT P. KELLY
DAVID M. JULIAN* Senior Vice President and Corporate Controller
---------------- (Principal Accounting Officer)
DAVID M. JULIAN
F. DUANE ACKERMAN* Director
------------------
F. DUANE ACKERMAN
JOHN D. BAKER, II* Director
------------------
JOHN D. BAKER, II
JAMES S. BALLOUN* Director
-----------------
JAMES S. BALLOUN
ROBERT J. BROWN* Director
----------------
ROBERT J. BROWN
Director
--------------------
PETER C. BROWNING
JOHN T. CASTEEN, III* Director
--------------------
JOHN T. CASTEEN, III
WILLIAM H. GOODWIN, JR.* Director
------------------------
WILLIAM H. GOODWIN, JR.
ROBERT A. INGRAM* Director
-----------------
ROBERT A. INGRAM
Director
------------------------
RADFORD D. LOVETT
MACKEY J. MCDONALD* Director
-------------------
MACKEY J. MCDONALD
12
SIGNATURE CAPACITY
--------- --------
JOSEPH NEUBAUER* Director
- -------------------
JOSEPH NEUBAUER
LLOYD U. NOLAND, III* Director
- --------------------
LLOYD U. NOLAND, III
RUTH G. SHAW* Director
- -------------
RUTH G. SHAW
LANTY L. SMITH* Director
- ---------------
LANTY L. SMITH
JOHN C. WHITAKER, JR.* Director
- ----------------------
JOHN C. WHITAKER, JR.
DONA DAVIS YOUNG* Director
- -----------------
DONA DAVIS YOUNG
*By Mark C. Treanor, Attorney-in-Fact
/s/ MARK C. TREANOR
-------------------
MARK C. TREANOR
Date: March 14, 2002
13
EXHIBIT INDEX
EXHIBIT NO. DESCRIPTION LOCATION
- ----------- ----------- --------
(2) Agreement and Plan of Merger, dated as of April 15, 2001 Incorporated by reference to Exhibit 2.1 to
and amended and restated, between Legacy First Union Legacy First Union's Registration Statement
and Legacy Wachovia. No. 333-59616.
(3)(a) Restated Articles of Incorporation of Wachovia. Incorporated by reference to Exhibit (3)(a)
to Wachovia's 2001 Third Quarter
Report on Form 10-Q.
(3)(b) Bylaws of Wachovia, as amended. Incorporated by reference to Exhibit (3)(b)
to Wachovia's 2001 Third Quarter Report
on Form 10-Q.
(4)(a) Instruments defining the rights of the holders of the *
Corporation's long-term debt.
(4)(b) Wachovia's Shareholder Protection Rights Agreement. Incorporated by reference to Exhibit (4)
to Legacy First Union's Current Report on
Form 8-K dated December 20, 2000.
(10)(a) Wachovia's Deferred Compensation Plan for Incorporated by reference to Exhibit
Officers. (10)(b) to Legacy First Union's 1988 Annual
Report on Form 10-K.
(10)(b) Wachovia's Deferred Compensation Plan for Incorporated by reference to Exhibit (10)(c) to
Non-Employee Directors, as amended. Legacy First Union's 2000 Annual
Report on Form 10-K.
(10)(c) Wachovia's Contract Executive Deferred Incorporated by reference to Exhibit
Compensation Plan. (10)(d) to Legacy First Union's 1997 Annual
Report on Form 10-K.
(10)(d) Wachovia's Supplemental Executive Long-Term Incorporated by reference to Exhibit
Disability Plan. (10)(d) to Legacy First Union's 1988 Annual
Report on Form 10-K.
(10)(e) Wachovia's 1988 Master Stock Compensation Incorporated by reference to Exhibit (28)
Plan. to Legacy First Union's Registration
Statement No. 33-47447.
(10)(f) Wachovia's 1992 Master Stock Compensation Incorporated by reference to Exhibit (28)
Plan. to Legacy First Union's Registration
Statement No. 33-47447.
(10)(g) Special Retirement Agreement between Wachovia and Incorporated by reference to Exhibit (10)
Edward E. Crutchfield. to Legacy First Union's 2000 Third Quarter
Report on Form 10-Q.
(10)(h) Wachovia's Elective Deferral Plan. Incorporated by reference to Exhibit (4)
to Legacy First Union's Registration
Statement No. 33-60913.
(10)(i) Wachovia's 1996 Master Stock Compensation Incorporated by reference to Exhibit (10)
Plan. to Legacy First Union's 1996 First Quarter
Report on Form 10-Q.
(10)(j) Wachovia's 1998 Stock Incentive Plan, as amended. Filed herewith.
(10)(k) Employment Agreement between Wachovia Incorporated by reference to Exhibit (10)(q)
and G. Kennedy Thompson. to Legacy First Union's 1999 Annual Report on
Form 10-K.
(10)(l) Amendment No. 1 to Employment Agreement between Filed herewith.
Wachovia and G. Kennedy Thompson.
(10)(m) Form of Employment Agreement between Wachovia Filed herewith.
and Benjamin P. Jenkins, III, Donald A. McMullen, Jr.,
and Stephen E. Cummings, and certain other
Executive Officers of Wachovia.
14
EXHIBIT NO. DESCRIPTION LOCATION
- ----------- ----------- --------
(10)(n) Wachovia's Senior Management Incentive Plan. Incorporated by reference to Exhibit (10)(t)
to Legacy First Union's 2000 Annual Report on
Form 10-K.
(10)(o) Employment Agreement between Wachovia and Incorporated by reference to Exhibit 10.1 to Legacy
L. M. Baker, Jr. First Union's Registration Statement
No. 333-59616.
(10)(p) Employment Agreement between Wachovia and Incorporated by reference to Exhibit 10.4 to Legacy
Robert S. McCoy, Jr. Wachovia's 2000 Third Quarter Report on
Form 10-Q.
(10)(q) Senior Executive Retirement Agreement between Wachovia Incorporated by reference to Exhibit 10.10 to Legacy
and L. M. Baker, Jr. Wachovia's 1999 Annual Report on Form 10-K.
(10)(r) Senior Executive Retirement Agreement between Wachovia Incorporated by reference to Exhibit 10.11 to Legacy
and Robert S. McCoy, Jr. Wachovia's 2000 Third Quarter Report on
Form 10-Q.
(10)(s) Form of Senior Executive Retirement Agreement between Incorporated by reference to Exhibit 10.15 to Legacy
Wachovia and certain Executive Officers of Wachovia. Wachovia's 1999 Annual Report on Form 10-K.
(10)(t) Wachovia's Senior Management Incentive Plan, Incorporated by reference to Exhibit 10.4 to Legacy
as amended. Wachovia's 1999 Second Quarter Report on Form 10-Q.
(10)(u) Wachovia's Amended and Restated Executive Deferred Incorporated by reference to Exhibit 10.2 to Legacy
Compensation Plan. Wachovia's 2000 First Quarter Report on Form 10-Q.
(10)(v) Wachovia's 2001 Stock Incentive Plan. Filed herewith.
(10)(w) Wachovia's Stock Plan, as amended and restated. Incorporated by reference to Exhibit 10.23 to Legacy
Wachovia's 2000 Third Quarter Report on Form 10-Q.
(10)(x) Wachovia's Executive Long-Term Disability Income Plan. Incorporated by reference to Exhibit 10.34 to Legacy
Wachovia's 1997 Annual Report on Form 10-K.
(10)(y) Split Dollar Life Insurance Agreement between Wachovia Incorporated by reference to Exhibit 10.35 to Legacy
and L. M. Baker, Jr. Wachovia's 2000 Third Quarter Report on Form 10-Q.
(10)(z) Split Dollar Life Insurance Agreement between Wachovia Incorporated by reference to Exhibit 10.36 to Legacy
and Robert S. McCoy, Jr. Wachovia's 2000 Third Quarter Report on Form 10-Q.
(10)(aa) Form of Callable Split Dollar Insurance Agreement between Incorporated by reference to Exhibit 10.39 to Legacy
Wachovia and certain Executive Officers of Wachovia. Wachovia's 2000 Third Quarter Report on Form 10-Q.
(10)(bb) Form of Non-Callable Split Dollar Insurance Agreement Incorporated by reference to Exhibit 10.40 to Legacy
between Wachovia and certain Executive Officers of Wachovia's 2000 Third Quarter Report on Form 10-Q.
Wachovia.
(12)(a) Computations of Consolidated Ratios of Earnings to Filed herewith.
Fixed Charges.
(12)(b) Computations of Consolidated Ratios of Earnings to Filed herewith.
Fixed Charges and Preferred Stock Dividends.
(13) The Corporation's 2001 Annual Report to Filed herewith.
Stockholders.**
(21) List of the Corporation's subsidiaries. Filed herewith.
(23) Consent of KPMG LLP. Filed herewith.
(24) Power of Attorney. Filed herewith.
* We agree to furnish to the SEC upon request, copies of the instruments,
including indentures, defining the rights of the holders of our
long-term debt and of our subsidiaries' long-term debt.
** Except for those portions of the Annual Report which are expressly
incorporated by reference in this Form 10-K, the Annual Report is
furnished for the information of the Securities and Exchange Commission
only and is not to be deemed "filed" as part of such Form 10-K.
15