FIFTH THIRD BANCORP - FORM 8-K - EX-99.1

Attached files

file	filename
8-K - 8-K - FIFTH THIRD BANCORP	d231201d8k.htm

Exhibit 99.1

Barclays Capital

Global Financial Services Conference

Kevin T. Kabat

President & Chief Executive Officer

September 13, 2011

Please refer to earnings release dated July 21, 2011 and

10-Q dated August 5, 2011 for further information

Key themes

Well-positioned for success and leadership in new banking landscape

Strong levels of profitability

in 2010 and throughout

2011, broad-based credit

improvements, exceed fully

phased-in Basel III capital

standards today

Completely exited all

crisis-era

government

support programs, one of

the few large banks without

TLGP-guaranteed debt

Continued investments in

business throughout crisis

to maintain and enhance

revenue-generating

capability while controlling

expenses

No significant business at

Fifth Third impaired during

crisis; traditional banking

focus consistent with

direction of financial reform

Environment characterized by low growth

expectations and low interest rates

Potential lower growth and prolonged low-

rate environment

Lower securities reinvestment yields on

portfolio cash flows

Strong deposit flows

Competitive dynamics

Pick up in mortgage refinance activity

Firms facing significant litigation related to:

—

Mortgage securitizations

—

GSE repurchases

—

Private label mortgage repurchases

Concerns about European sovereign debt

and banks / U.S. downgrade

Continued strong loan production

—

Rates on loan originations have remained

relatively stable

Careful management of liability costs

—

Disciplined pricing on deposits

—

Continued evaluation of term liabilities

including CDs and TruPS

Stronger mortgage banking results

Mortgage risks manageable

—

Quarterly mortgage repurchase expense

~$25mm and declining

—

Total mortgage securitizations outstanding

$35mm

and performing well (2003 HELOC)

Total

non-U.S.

sovereign

debt

exposure

$3mm

—

No peripheral* Europe sovereign debt

—

~$200mm

in total exposure to companies in

peripheral* Europe:

$30mm loans to foreign domiciled

$54mm trade finance

$115mm loans to US subs of above

* Greece, Ireland, Italy, Portugal, Spain

Fifth Third is well-positioned to deal with current environmental challenges

Characteristics of current environment

Fifth Third’s response / position

Diverse revenue stream

•

—

Current NII lower than normalized levels due to impact of low rate environment (e.g. low cost

deposits including DDAs providing no explainable NII benefit)

•

Added clarity regarding effect of reform on deposit and interchange fees

—

Service charge impact (i.e. Reg E) already in run-rates

—

Initial $30 million per quarter impact of Durbin amendment expected to be mitigated over time

(~1/3+ 4Q11; ~2/3 1H12; additional mitigation over time)

43% Fee income

NII

Fee income as % of 2Q11 revenue

2Q11 Fee income distribution

Revenue results remain solid, profitability strong despite sluggish economy

57%

Deposit fees

Corporate

banking

Investment

advisors

Other

Mortgage

Card & Processing

14%

19%

25%

Business mix provides higher than average diversity among spread and fee revenues

Core funded balance sheet and pricing discipline

•

Strong, deposit rich core funding mix supports

relatively low cost of funds

–

Low reliance on wholesale funding

•

Run-off of high cost CDs (particularly from 2H08)

will benefit NII in 2H11

–

$8mm benefit expected in 3Q11 with

incremental $15mm in 4Q11

•

Pricing discipline on commercial loans

–

Spreads have narrowed from post-crisis levels

but remain attractive

–

Loan rates have stabilized the past several

months

SOURCE: SNL Financial and company reports. Data as of 2Q11.

End of period transaction deposits defined as DDA, NOW and Savings/MMDA accounts; Cost of Funds defined as interest incurred on interest-bearing liabilities as a percentage of average noninterest-bearing deposits

and interest-bearing liabilities

Transaction Deposits / Total Deposits

C&I Spread to 1-month LIBOR

Peer average

80%

Cost of Funds

Peer average

0.81%

87%

86%

85%

83%

82%

80%

79%

77%

74%

73%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

ZION

MTB

CMA

FITB

WFC

STI

PNC

USB

KEY

BBT

HBAN

1.31%

1.00%

0.94%

0.80%

0.79%

0.76%

0.74%

0.66%

0.64%

0.34%

0.0%

0.5%

1.0%

1.5%

ZION

BBT

KEY

USB

STI

FITB

HBAN

PNC

MTB

WFC

CMA

0.0%

1.0%

2.0%

3.0%

4.0%

5.0%

6.0%

7.0%

1Q08

2Q08

3Q08

4Q08

1Q09

2Q09

3Q09

4Q09

1Q10

2Q10

3Q10

4Q10

1Q11

2Q11

C&I Yield

1 Month Libor

Spread

Expense discipline

Efficiency ratio*

Peer average: 64%

Sales / support ratio**

Efficient business model:

•

Efficiency ratio better than most peers through

weak economic environment

–

Reflects below-capacity balance sheet and

lower revenue than we expect and can

support longer term

–

Current impact of credit costs on revenue

and expenses

Disciplined expense management

•

Expenses being managed carefully in response

to revenue environment

–

Down 6% versus early 2010

–

Continuous process of expense evaluation

at Fifth Third

Investment for the future:

•

Sales to support ratio has increased through

careful management of back office and front

office staff

Managing expenses for current revenue environment and long-term franchise value

Noninterest expense trend ($mm)

(6%)

Significant purchase accounting

benefit (ex-FITB)

* Source: Company reports. Data as of 2Q11. Efficiency ratio calculated as reported noninterest expense / (net interest income (fully taxable equivalent)+ noninterest income)

** Sales / support ratio calculated as Sales Headcount (full-time equivalent) / Support Headcount (full-time equivalent)

52%

53%

59%

60%

61%

64%

65%

66%

69%

70%

72%

76%

USB

MTB

FITB

PNC

WFC

BBT

HBAN

KEY

CMA

STI

ZION

$956

$935

$979

$987

$918

$901

$500

$700

$900

$1,100

1Q10

2Q10

3Q10

4Q10

1Q11

2Q11

100%

110%

120%

130%

140%

4Q08

4Q09

4Q10

2Q11

$1,000

$800

$600

Strong pre-provision net revenue

PPNR trend

Pre-provision net revenue (PPNR): net interest income plus noninterest income minus noninterest expense. Adjusted PPNR excludes securities gains / losses, other than temporary impairment gains / losses, and other

related one-time items. Refer to appendix for reconciliation and detailed breakout of credit-related adjustments.

Source: SNL Financial and company reports. Data as of 2Q11.

* There

are

limitations

the

usefulness

credit-adjusted

PPNR,

including

the

significant

degree

which

changes

credit

and

fair

value

are

integral,

recurring

components

the

Bancorp’s

core

operations

financial institution. This measure has been included herein to facilitate a greater understanding of the Bancorp’s financial condition.

** NPAs exclude covered assets for BBT, USB, ZION

•

2Q11 PPNR of $619mm up 14% from 1Q11 levels, and up 9% over prior year

–

Reflects improved noninterest income and noninterest expense, partially offset by a decrease in net

interest income

•

Adjusted PPNR of $582mm up 7% sequentially and 5% year-over-year

–

Includes negative adjustments totaling $37mm

–

Results also included $64mm in credit related costs

Adjusted PPNR / Risk-weighted assets

Adjusted PPNR / Nonperforming assets (HFI)

Robust pre-provision profitability = capacity to absorb losses and strong bottom line

Significant purchase

accounting benefit

Peer avg.: 2.3%

Peer avg.: 111%

Significant purchase

accounting benefit

PPNR $567 $760 $583

$545 $619

552

634

581

545

582

2Q10

3Q10

4Q10

1Q11

2Q11

Fee Income Credit Items

Adjusted PPNR

3.5%

3.0%

2.9%

2.6%

2.3%

2.2%

2.1%

1.8%

1.7%

1.2%

USB

WFC

BBT

PNC

FITB

MTB

HBAN

STI

ZION

KEY

CMA

270%

139%

126%

111%

109%

104%

102%

67%

58%

53%

52%

USB

KEY

HBAN

PNC

FITB

MTB

WFC

BBT

CMA

STI

ZION

Noninterest Expense Credit Items

Expect ROAA upside longer-term

Second quarter ROA of 1.22% included

—

Provision expense / average loans

of 58 bps

—

$64mm of credit-related costs in

revenue and expense

Elevated credit costs should decline as

conditions normalize

—

Credit-related costs historically of

~$25mm (pre-credit crisis)

—

1997-2006 Average Provision /

Loans of ~50 bps (45 bps average

net charge-off ratio)

—

2Q11 results and historical average

credit results would produce an

ROAA of approximately 1.4%

Long-term target of 1.3 –

1.5% return on assets

Earning asset growth

Mid-50% efficiency ratio long-term

NIM of 3.5-4.0%

Provision of 40-60 bps

Fees / Revenue ~40%

Mitigation of financial reform

2Q11

Actual

2Q11

Illustrative

PPNR ex-credit costs**

$683

Credit costs

(64)

(25)

PPNR

619

658

Provision***

(113)

(97)

Pre-tax income

506

561

Taxes****

(169)

(168)

Net Income

337

393

ROAA

1.22%

1.42%

Illustrative ROA calculation using

historical NCO and credit-related costs*

* Not a projection

** PPNR before inclusion of credit costs

*** Illustrative provision calculated using 50 bps historical average provision / loan ratio

**** Illustrative taxes assumed effective tax rate of ~30%

Upper end of ROA target range assumes balance sheet growth and normalized rate environment

Strong relative credit trends

NPA ratio vs. peers

Net charge-off ratio vs. peers

Loans 90+ days delinquent % vs. peers

Loans 30-89 days delinquent % vs. peers

(7.5%)*

(HFS transfer)

3.8%

Before credit

actions

5.0%*

3Q11

expect

down

2.3%

Before credit

actions

FITB credit metrics are in line with or better than peers

Peer average includes: BBT, CMA, HBAN, KEY, MTB, PNC, RF, STI, USB, WFC, and ZION

Source: SNL Financial and company filings. All ratios exclude loans held-for-sale and covered assets for peers where appropriate.

* 4Q08 NCOs included $800mm in NCOs related to commercial loans moved to held-for-sale; 3Q10 NCOs included $510mm in NCOs related to loans sold or moved to held-for-sale

Strong credit coverage levels

Source: SNL Financial and company reports. Data as of 2Q11. HFI NPAs and NPLs exclude loans held-for-sale and also exclude covered assets for BBT, USB, and ZION

“Texas Ratio”

(HFI NPAs + Over 90s) / (Reserves + TCE)

Peer average: 23%

Reserves / NPLs

Peer average: 116%

(HFI NPAs + Over 90s –

Reserves) / TCE

Peer average: 4%

Reserves / Loans

Peer average: 2.7%

Reserves and capital levels significant in relation to problem assets

Strong capital position, Basel I and Basel III

Tier 1 common (peers)

Tier 1 common (FITB)

Reserves

12.8%

11.9%

12.6%

11.7%

12.3%

11.8%

11.3%

10.4%

11.3%

7.9%

11.3%

Peers* not in order of graph at left; estimated

Reserves

Tier 1 common (peers)

Tier 1 common (FITB)

12.2%

Bank

FITB

Bank

9.6%

(Tier 1 common + reserves) / RWA

(not

adjusted

for

Basel III)

(Tier 1 common + reserves) / RWA

(adjusted

for

Basel III)

Fifth Third’s capital position already well in excess of established standards, likely standards, and most peers

Source: SNL Financial, company filings, and third-party estimates. Regulatory financial data as of 2Q11.

* Peers include BAC, BBT, C, CMA, COF, HBAN, JPM, KEY, MTB, PNC, RF, STI, USB, WFC, ZION

Note: Estimates based on current Basel III rules released by the Basel Committee; actual

rules subject to U.S. banking regulation. Assumes unrealized securities gains included in

Tier 1 common. Not adjusted for potential mitigation efforts. Four large peers include

estimated Basel III RWA impact based on BIS proposals.

Capital management philosophy

* Subject to Board of Directors and regulatory approval

** Comprehensive Capital Adequacy Review by Federal Reserve;

proposed future capital actions confidentially submitted

Organic growth opportunities

•

Support growth of core banking franchise

•

Continued loan growth despite sluggish

economy

Return

normal

dividend

policy

•

Strong levels of profitability would support

significantly higher dividend than current level

•

Incorporated

higher

dividends

1Q11

CCAR

submission

Strategic opportunities

•

Prudently expand franchise or increase

density in core markets via disciplined

acquisitions or de novos

•

Attain top 3 market position in 65% of markets

or more longer term

•

Expect future acquisition activity although less

likely in near-term

Repurchases / Redemptions

•

Common shares:

—

Manage excess capital in light of regulatory

environment, other deployment alternatives,

maintenance of buffers over targeted / required

capital levels, and stock price

—

Not included in 1Q11 CCAR** submission

•

Trust preferred shares (TruPS):

—

Potential redemption of certain TruPS included in

1Q11 CCAR

submission

—

Have called $517mm due to regulatory capital

treatment event or on normal call dates

—

Will evaluate remaining TruPS in context of

regulatory developments and desired capital

structure given continued changes in regulations

Strong internal capital generation; current long-term Tier 1 common equity target of ~8%

Strong returns drive capital generation

* 2Q11 annualized

Price as of 9/9/11

Price / Tangible Book Value

Peer average: 113%

Return on Average Tangible Common Equity*

Peer average: 12.2%

Significant purchase

accounting benefit

Return on Average Assets*

Peer average: 1.0%

Price / Earnings*

Peer average: 11.9

Significant purchase

accounting benefit

Well above average profitability and capital generation, well below average valuation

Customer-centric traditional banking model:

well-positioned for changed financial landscape

Fifth Third’s business model is driven by traditional banking activities, consistent with

direction of financial reform

—

Dodd-Frank / Basel III do not require substantial changes to Fifth Third’s business

model or asset mix with attendant execution risk

—

Low level of financial system “interconnectedness”

–

International activity primarily related to trade finance and lending to U.S.

subsidiaries of foreign companies

–

(e.g.)

Fifth

Third

loss

Lehman

bankruptcy

expected

less

than

$2mm

—

Little to no impact from Volcker rule (de minimis market maker in derivatives,

proprietary trading)

–

Daily VaR ~$1mm or less

–

Small private equity portfolio ~$100mm

—

No originations of CDOs, securitizations on behalf of others

—

Didn’t originate or sell subprime mortgages or Option ARMs

—

No mortgage securitizations outstanding (except ~$35mm HELOC from 2003)

Business

profile

positions

Fifth

Third

well

–

today

and

the

future

No significant business at Fifth Third impaired during crisis

Well-positioned for the future

•

Holding company cash currently sufficient for nearly 2 years of obligations; no holding company or Bank debt

maturities until 2013

•

Fifth Third has completely exited all crisis-era government support programs

–

Fifth Third is one of the few large banks that have no TLGP-guaranteed debt to refinance in 2012

Superior capital and liquidity position

•

NCOs below 1.6%; 2.1x reserves / annualized NCOs

•

$1.2B problem assets addressed through loan sales and transfer to HFS in 3Q10

•

Substantial reduction in exposure to CRE since 1Q09; relatively low CRE exposure versus peers

Proactive approach to risk management

•

Traditional commercial banking franchise built on customer-oriented localized operating model

•

Strong market share in key markets with focus on further improving density

•

Fee income ~40% of total revenues

Diversified traditional banking platform

•

PPNR has remained strong throughout the credit cycle

•

PPNR substantially exceeds annual net charge-offs (204% PPNR / NCOs in 2Q11)

•

1.2% ROAA; 14% return on average tangible common equity

Industry leader in earnings power

Cautionary statement

This report contains statements that we believe are “forward-looking statements” within the meaning of Section 27A of the Securities Act

of 1933, as amended, and Rule 175 promulgated thereunder, and Section 21E of the Securities Exchange Act of 1934, as amended, and

Rule 3b-6 promulgated thereunder. These statements relate to our financial condition, results of operations, plans, objectives, future

performance or business. They usually can be identified by the use of forward-looking language such as “will likely result,” “may,” “are

expected to,” “is anticipated,” “estimate,” “forecast,” “projected,” “intends to,” or may include other similar words or phrases such as

“believes,” “plans,” “trend,” “objective,” “continue,” “remain,” or similar expressions, or future or conditional verbs such as “will,” “would,”

“should,” “could,” “might,” “can,” or similar verbs. You should not place undue reliance on these statements, as they are subject to risks

and uncertainties, including but not limited to the risk factors set forth in our most recent Annual Report on Form 10-K. When considering

these forward-looking statements, you should keep in mind these risks and uncertainties, as well as any cautionary statements we may

make. Moreover, you should treat these statements as speaking only as of the date they are made and based only on information then

actually known to us.

There are a number of important factors that could cause future results to differ materially from historical performance and these forward-

looking statements. Factors that might cause such a difference include, but are not limited to: (1) general economic conditions and

weakening in the economy, specifically the real estate market, either nationally or in the states in which Fifth Third, one or more acquired

entities and/or the combined company do business, are less favorable than expected; (2) deteriorating credit quality; (3) political

developments, wars or other hostilities may disrupt or increase volatility in securities markets or other economic conditions; (4) changes in

the interest rate environment reduce interest margins; (5) prepayment speeds, loan origination and sale volumes, charge-offs and loan

loss provisions; (6) Fifth Third’s ability to maintain required capital levels and adequate sources of funding and liquidity; (7) maintaining

capital requirements may limit Fifth Third’s operations and potential growth; (8) changes and trends in capital markets; (9) problems

encountered by larger or similar financial institutions may adversely affect the banking industry and/or Fifth Third; (10) competitive

pressures among depository institutions increase significantly; (11) effects of critical accounting policies and judgments; (12) changes in

accounting policies or procedures as may be required by the Financial Accounting Standards Board (FASB) or other regulatory agencies;

(13) legislative or regulatory changes or actions, or significant litigation, adversely affect Fifth Third, one or more acquired entities and/or

the combined company or the businesses in which Fifth Third, one or more acquired entities and/or the combined company are engaged,

including the recently enacted Dodd-Frank Wall Street Reform and Consumer Protection Act; (14) ability to maintain favorable ratings fro

rating agencies; (15) fluctuation of Fifth Third’s stock price; (16) ability to attract and retain key personnel; (17) ability to receive dividends

from its subsidiaries; (18) potentially dilutive effect of future acquisitions on current shareholders’ ownership of Fifth Third; (19) effects of

accounting or financial results of one or more acquired entities; (20) difficulties in separating Vantiv, LLC, formerly Fifth Third Processing

Solutions from Fifth Third; (21) loss of income from any sale or potential sale of businesses that could have an adverse effect on Fifth

Third’s earnings and future growth; (22) ability to secure confidential information through the use of computer systems and

telecommunications networks; and (23) the impact of reputational risk created by these developments on such matters as business

generation and retention, funding and liquidity.

You should refer to our periodic and current reports filed with the Securities and Exchange Commission, or “SEC,” for further information

on other factors, which could cause actual results to be significantly different from those expressed or implied by these forward-looking

statements.

2011

2012

2013

2014

2015

2016

2017 on

Fifth Third Bancorp

Fifth Third Capital Trust

$4,313

$750

Liquidity levels elevated in 3Q11

As of 2Q11, readily available borrowing capacity at FHLB:

$6.1B; contingent borrowing capacity at the Fed: $20.8B

—

Executed $2.5B in three-month FHLB borrowings in July

as a precaution to supplement liquidity through the

discussion and resolution of the U.S. debt ceiling limit

Holding Company cash at 6/30/11: $1.3B

Cash currently sufficient to satisfy all fixed obligations

for nearly 2 years (debt maturities, common and

preferred dividends, interest and other expenses)

without accessing capital markets; relying on dividends

from subsidiaries; proceeds from asset sales

Expected cash obligations over the next 12 months

—

$0 debt maturities

—

~$221mm common dividends (at $0.06 dividend)

—

~$35mm Series G preferred dividends

—

~$450mm interest and other expenses

Holding company unsecured debt maturities ($mm)

Heavily core funded

$1,250

Strong liquidity profile

S-T

wholesale

$500

2011

2012

2013

2014

2015

2016

2017 on

Demand

21%

Interest

checking

16%

Savings/

MMDA

Foreign office

Consumer

time

Non-core

deposits

S-T

borrowings

Other

liabilities

Equity

11%

L-T debt

Bank unsecured debt maturities ($mm – excl. Brokered CDs)

24%

Mortgage repurchase overview

Demand requests and repurchase losses remain

volatile; near-term repurchase losses are expected to

remain somewhat elevated

Virtually all sold loans and new claims relate to

agencies

—

98% of outstanding balance of loans sold

—

87% of currently outstanding claims

Majority of outstanding balances of the serviced for

others portfolio relates to origination activity in 2009

and later

Private claims and exposure relate to whole loan sales

(no outstanding first mortgage securitizations)

—

Preponderance of private sales prior to 2006

Repurchase Reserves* ($ in millions)

2Q10

3Q10

4Q10

1Q11

2Q11

Beginning balance

$84

$85

$103

$101

$87

Net reserve additions

Repurchase losses

(18)

(29)

(23)

(22)

Ending balance

$85

$103

$101

$87

$80

Outstanding Counterparty Claims ($ in millions)

Outstanding Balance of Sold Loans ($ in millions)

2005 and prior

GSE

GNMA

Private

Total

$8,388

$318

$613

$9,319

2006

1,915

289

2,271

2007

3,119

252

3,470

2008

3,248

774

4,024

2009 and later

28,677

8,264

36,942

Total

$45,348

$9,522

$1,155

$56,025

Includes reps and warranty reserve ($60mm) and reserve for loans sold with recourse ($20mm)

Troubled debt restructurings overview

Successive improvement in vintage performance during

2008 and 2009 as volume of modification increased

Fifth Third’s mortgage portfolio TDRs have redefaulted

at a lower rate than GSE composites

Of $1.8B in consumer TDRs, $1.6B were on accrual

status and $211mm were nonaccruals

—

$1.1B of TDRs are current and have been on the

books 6 or more months; within that, nearly

$920mm of TDRs are current and have been on

the books for more than a year

As current TDRs season, their default propensity

declines significantly

—

We see much lower defaults on current loans after

a vintage approaches 12 months since

modification

TDR performance has improved in newer vintages

Outperforming redefault benchmarks

Source: Fifth Third and OCC/OTS data through 4Q10

Mortgage TDR 60+ redefault trend by vintage*

1Q08 4%

2Q08 7%

3Q08 8%

4Q08 9%

1Q09 12%

2Q09 13%

Months since modification

Mortgage TDR 60+ redefault rate: Fifth Third comparison

(January 1, 2008 through March 2011)*

Fannie Mae

Industry

portfolio loans

Fifth Third

Volume by

vintage

Freddie Mac

3Q09 13%

$1.3B current consumer TDRs (%)

4Q09 8%

$1.1

billion

2008

2009

1Q10 7%

2Q10 5%

* Fifth Third data includes changes made to align with OCC/OTS methodology (i.e. excludes government loans, closed loans and OREO from calculations)

2010

NPL rollforward

Significant improvement in NPL inflows over past two years

Consumer NPL inflows restated to conform with call report guidelines

NPL HFI Rollforward

Commercial

2Q09

3Q09

4Q09

1Q10

2Q10

3Q10

4Q10

1Q11

2Q11

Beginning NPL Amount

1,937

2,110

2,430

2,392

2,172

1,980

1,261

1,214

1,211

New nonaccrual loans

544

832

602

405

310

290

224

299

309

Paydowns, payoffs, sales and net other activity

(190)

(246)

(332)

(425)

(402)

(630)

(168)

(199)

(177)

Charge-offs

(181)

(266)

(308)

(200)

(100)

(379)

(103)

(90)

Ending Commercial NPL

2,110

2,430

2,392

2,172

1,980

1,261

1,214

1,211

1,253

Consumer

2Q09

3Q09

4Q09

1Q10

2Q10

3Q10

4Q10

1Q11

2Q11

Beginning NPL Amount

459

477

517

555

561

550

323

466

434

New nonaccrual loans

157

166

193

170

238

182

283

153

140

Net other activity

(139)

(126)

(155)

(164)

(249)

(409)

(140)

(185)

(188)

Ending Consumer NPL

477

517

555

561

550

323

466

434

386

Total NPL

2,587

2,947

2,733

2,530

1,584

1,680

1,645

1,639

Total new nonaccrual loans -

HFI

701

998

795

575

548

472

507

452

449

Non-performing loans

Non-performing loans ($mm)

$2.5B

$1.6B

Non-performing loans improving with lower

severity mix; benefit of sales/transfers

$1.6B

Fifth Third’s non-performing loan inflows (relative to loans) have been

proportionally lower than peers

FITB NPL inflows (relative to loans) vs. peers

FITB

Source: SNL Financial and company filings. Peers include: BAC, BBT, C, CMA, HBAN, JPM, KEY, MTB, PNC, RF, STI, USB, and WFC

New HFI non-performing loan flows ($mm)

NPL inflows down significantly

$1.7B

* 3Q10 inflows into NPLs HFS were $217mm, reflecting performing loans moved to held-for-sale in 3Q10 that were deemed impaired as a result of the decision to sell these loans

See slide 20 for more information

Consumer NPL inflows restated to conform with call report guidelines

$1.6B

FITB

ex-HFS

Regulation G Non-GAAP reconciliation

$ in millions

(unaudited)

June

March

December

September

June

2011

2010

Pre-tax Pre-provision Net Revenue:

Income before income taxes (a)

506

377

417

303

242

Provision expense (b)

113

168

166

457

325

Pre-tax, pre-provision net revenue (PPNR) (a) + (b)

619

545

583

760

567

Annualized PPNR (c)

2,483

2,210

2,313

3,015

2,274

Adjustments remove (benefit) / detriment

Securities (gains) / losses

(6)

(8)

(21)

(4)

(8)

Gain on BOLI settlement

(127)

Valuation of 2009 Visa total return swap

Vantiv, LLC warrants & puts

(29)

(3)

(10)

Other litigation reserve expense

Extinguishment (gains) / losses

(6)

(3)

Adjusted PPNR

582

545

581

634

552

Annualized Adjusted PPNR (d)

2,328

2,180

2,324

2,536

2,208

Credit-related items in noninterest income

Gain / (loss) on sale of loans

(1)

Commercial loans HFS FV adjustment

(9)

(16)

(35)

(9)

(7)

Gain / (loss) on sale of OREO properties

(26)

(2)

(19)

(29)

(13)

Mortgage repurchase costs

(0)

(2)

(1)

(2)

(1)

Total credit-related revenue impact

Credit-related items in noninterest expense

Mortgage repurchase expense

Provision for unfunded commitments

(14)

(16)

(4)

(23)

(6)

Derivative valuation adjustments

(0)

(1)

OREO expense

Attached files

Stock widget

Investing forum