PRIVATEBANCORP, INC - FORM 8-K - EX-99.1 - FOURTH QUARTER 2011 EARNINGS RELEASE DATED JANUARY 24, 2012

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8-K - FORM 8-K - PRIVATEBANCORP, INC	d286955d8k.htm

Exhibit 99.1

LOGO

For further information:

Media Contact:

Amy Yuhn

312-564-1378

ayuhn@theprivatebank.com

Investor Relations Contact:

Sarah Lewensohn

312-564-3894

slewensohn@theprivatebank.com

For Immediate Release

PrivateBancorp Reports Fourth Quarter and Full Year 2011 Results

•

Full year 2011 diluted earnings per share of $0.43, compared to loss of $0.17 per share in 2010

•

Total loans increased 4 percent from the third quarter

•

Asset quality improves; non-performing loans decrease 15 percent in the fourth quarter

CHICAGO, January 24, 2012 – PrivateBancorp, Inc. (NASDAQ: PVTB) today reported net income available to common shareholders of $7.6 million, or $0.11 per diluted share, for the fourth quarter 2011, compared to $8.5 million, or $0.12 per diluted share, for the fourth quarter 2010. For the 12 months ended December 31, 2011, the Company had net income available to common shareholders of $30.7 million, or $0.43 per diluted share, compared to a net loss of $12.1 million, or $0.17 loss per diluted share, for the prior year.

“We remain focused on executing our relationship-based commercial middle market strategy and our results in 2011 reflect the improvement in overall asset quality as well as the success we’ve had in growing our business,” said Larry D. Richman, President and Chief Executive Officer, PrivateBancorp, Inc. “Over the year, we added important new client relationships, continued to grow our commercial and industrial loans, and increased non-interest income. In 2011, our loan mix improved, the credit characteristics of the portfolio were stronger and non-performing assets declined, which combined to help drive the turnaround and led to $30.7 million in net income for the year. I believe we are positioned to benefit as the economic environment improves.

“We ended the year with a solid fourth quarter, including more than $330 million in net loan growth from new commercial relationships and increased demand from existing clients. Given our healthy pipeline and the opportunities we have to grow client relationships, I am confident that, as we move into 2012, we will continue to leverage the strengths of our team to serve our clients and our communities and continue to build long-term shareholder value.”

Fourth Quarter and Full Year Results

•

Full year 2011 net income available to common shareholders grew to $30.7 million compared to a net loss of $12.1 million for the full year 2010. Net interest margin was 3.48 percent for the fourth quarter 2011, compared to 3.49 percent in the prior quarter.

•

Total loans grew $333.6 million this quarter with the majority of the growth in commercial and industrial loans. Over the course of the year the Company increased commercial and industrial loans to 60 percent of the total loan portfolio at year-end 2011 compared to 54 percent a year ago.

•

Total deposits increased to $10.4 billion at December 31, 2011, with growth in non-interest bearing deposits of 15 percent from the end of the third quarter 2011. While total deposits were relatively flat compared to prior year, non-interest bearing deposits comprised 31 percent of total deposits at December 31, 2011, compared to 21 percent at December 31, 2010.

•

Special mention and potential problem loans continued to decline. At year-end 2011, special mention and potential problem loans were $382.1 million, a decrease of $113.6 million, or 23 percent, from September 30, 2011 and a decrease of $524.4 million, or 58 percent, from the prior year.

•

Non-performing assets declined 8 percent from September 30, 2011 and 15 percent from December 31, 2010, reflecting disposition activity and ongoing workout efforts. Disposition activity for the quarter included $68.1 million in problem loans and $20.3 million in other real estate owned (OREO). Total problem asset dispositions were $387.8 million for the full year 2011.

Operating Performance

Net revenue was $129.0 million in the fourth quarter 2011, compared to $136.1 million in the fourth quarter 2010 and $129.4 million in the third quarter 2011. The fourth quarter 2011 results include net securities gains of $364,000, compared to $9.3 million net securities gains in the fourth quarter 2010 and $4.4 million net securities gains in the third quarter 2011. Excluding net securities gains, net revenue increased 2 percent from the fourth quarter 2010 and 3 percent from the third quarter 2011.

For the full year 2011, net revenue increased to $508.2 million compared to $497.8 million in 2010. Excluding net securities gains of $5.8 million and $12.2 million for years ended 2011 and 2010, respectively, net revenue increased 3 percent. Overall net revenue performance on a year-over-year basis was driven by net interest margin expansion and ongoing cross-sell to new and existing clients.

Net interest margin was 3.48 percent for the fourth quarter 2011, compared to 3.33 percent in the fourth quarter 2010 and 3.49 percent for the third quarter 2011. During the fourth quarter 2011 net interest margin benefited from a number of factors including the continued execution of the Company’s

strategy to improve the loan mix including the replacement of low-yielding commercial real estate loans and non-performing loan balances with better priced commercial and industrial and commercial real estate loans. Net interest margin also benefited from the increase in short-term LIBOR during the quarter. Increased volume of non-interest bearing demand accounts and downward deposit repricing during the quarter favorably impacted the cost of funds, benefiting net interest margin by 5 basis points as compared to the third quarter 2011. Net interest income increased to $103.0 million in the fourth quarter 2011, compared to $100.3 million for the fourth quarter 2010 and $101.1 million in the third quarter 2011. For the full year 2011, net interest income increased 2 percent to $407.1 million, from $401.0 million for full year 2010.

Operating profit was $52.8 million in the fourth quarter 2011, compared to $53.9 million in the fourth quarter 2010 and $54.4 million in the third quarter 2011. Excluding net securities gains, operating profit increased 18 percent from the fourth quarter 2010 and 5 percent from the third quarter 2011. For the full year, operating profit increased to $206.0 million, compared to $198.2 million in 2010. Operating profit, excluding net securities gains, grew 8 percent from the prior year.

Non-interest income was $25.4 million in the fourth quarter 2011, compared to $34.9 million in the fourth quarter 2010 and $27.6 million in the third quarter 2011. Non-interest income decreased 2 percent compared to the fourth quarter 2010 and increased 8 percent compared to the third quarter 2011, excluding net securities gains. For the full year 2011, non-interest income increased to $98.2 million, up from $93.2 million for the year ended December 31, 2010. Excluding net securities gains, non-interest income grew 14 percent from the prior year.

Treasury management income increased 14 percent from the fourth quarter 2010 and 5 percent from the third quarter 2011. Trust and investment income for the fourth quarter was $4.0 million, compared to $4.6 million in the fourth quarter 2010 and $4.5 million in the third quarter 2011. Capital markets revenue was $5.5 million for the fourth quarter 2011, compared to $6.8 million for the fourth quarter 2010 and $5.5 million for the third quarter 2011. Excluding the impact of the credit valuation adjustment, capital markets revenue was $5.2 million in the fourth quarter 2011, compared to $5.0 million in the fourth quarter 2010 and $6.7 million in the third quarter 2011. Capital markets revenue declined compared to the third quarter 2011 due to some large transactions that occurred in the third quarter. Loan and credit related fees grew 19 percent from the fourth quarter 2010 and 4 percent from last quarter due to increased syndications revenue.

Mortgage banking income was $3.0 million in the fourth quarter 2011, compared to $3.5 million in the fourth quarter 2010 and $1.6 million in the third quarter 2011. The fourth quarter 2011 benefited from a full quarter of refinance activity based on the low interest rate environment.

Expenses

Non-interest expense was $76.2 million in the fourth quarter 2011, compared to $82.1 million in the fourth quarter 2010 and $75.0 million in the third quarter 2011. Non-interest expense for the full year 2011 was $302.3 million, relatively flat compared to $299.6 million for the full year 2010 due to continued expense management throughout the year.

Salary and benefit expense was higher in the fourth quarter 2011, compared to the fourth quarter 2010 and the third quarter 2011, due to an increase in commission-based compensation and a higher annual incentive compensation accrual. Insurance expense declined compared to the fourth quarter 2010 and the third quarter 2011 due to the implementation of a change in the FDIC calculation methodology. Overall credit costs remain elevated.

The efficiency ratio was 59.1 percent in the fourth quarter 2011, compared to 60.4 percent in the fourth quarter 2010 and 58.0 percent in the third quarter 2011.

The effective tax rate for the fourth quarter was 46.1 percent and was impacted by the non-deductibility of certain compensation expense as well as reduced tax benefits relating to the impact of current share price valuation on stock-based compensation. Based on the Company’s current projection, the effective tax rate for 2012 should decline from the fourth quarter rate, although the rate will continue to be dependent on a number of factors, including future share prices.

Credit Quality

The 2011 results reflect strong progress in improving the overall asset quality of the portfolio and reducing problem assets. Non-performing assets declined to $385.6 million at December 31, 2011, down from $454.6 million at December 31, 2010, and $421.1 million at September 30, 2011. Non-performing assets to total assets were 3.11 percent at December 31, 2011, compared to 3.65 percent at December 31, 2010, and 3.50 percent at September 30, 2011. Non-performing loans were $259.9 million at year-end 2011, down from $365.9 million a year ago and $304.7 million at the end of last quarter. Non-performing loan inflows were $67.5 million in the fourth quarter 2011.

Special mention and potential problem loans declined further in the fourth quarter 2011, down 23 percent from third quarter 2011. Over the past year, special mention and potential problem loans have declined $524.4 million, or 58 percent, to $382.1 million at December 31, 2011. The Company disposed of $387.8 million problem assets this year, with an aggregate incremental charge of 15 percent based on the carrying value net of specific reserves at the time of disposition. The Company expects continued strengthening of the credit quality of the portfolio as problem loan resolutions continue.

The fourth quarter 2011 provision for loan losses was $29.8 million, excluding covered loan provision, down from $34.5 million in the fourth quarter 2010 and $32.3 million in the third quarter 2011. For the full year 2011, the provision for loan losses was $130.6 million, excluding covered loan provision, down from $192.0 million in the prior year. The allowance for loan losses at December 31, 2011 was $191.6 million, or 2.13% of total loans, compared to $222.8 million, or 2.44% of total loans, at December 31, 2010 and $200.0 million, or 2.31% of total loans at September 30, 2011. The allowance for loan losses as a percentage of non-performing loans was 74 percent at December 31, 2011, compared to 61 percent at December 31, 2010, and 66 percent at September 30, 2011.

Net charge-offs were $38.2 million for the quarter ended December 31, 2011, compared to $35.1 million for the fourth quarter 2010 and $38.6 million for the third quarter 2011. For the year ended December 31, 2011, net charge-offs were $161.8 million, down from $190.9 million in the prior year.

Restructured loans accruing interest were $100.9 million at December 31, 2011, compared to $87.6 million at December 31, 2010 and $106.3 million at September 30, 2011. The Company utilizes loan restructuring in an effort to maximize economic recovery.

Credit quality results exclude $306.8 million in covered assets as of the end of the fourth quarter 2011, referring to certain assets acquired through an FDIC-assisted transaction that are subject to a loss-sharing agreement, compared to $397.2 million in the fourth quarter 2010 and $319.0 million in the third quarter 2011.

Balance Sheet

Commercial and industrial loans were $5.4 billion, an increase of 11 percent compared to prior year and an increase of 6 percent from September 30, 2011. Total loans were $9.0 billion at year-end 2011, compared to $9.1 billion at year-end 2010 and $8.7 billion at September 30, 2011.

Total assets were $12.4 billion at December 31, 2011, compared to $12.5 billion at December 31, 2010, and $12.0 billion at September 30, 2011. Total deposits were $10.4 billion at December 31, 2011, compared to $10.5 billion at December 31, 2010, and $10.1 billion at September 30, 2011. Non-interest bearing deposits grew to $3.2 billion, an increase of 44 percent compared to $2.3 billion a year ago. The increase in non-interest bearing deposit balances can be attributed to several factors including growth from existing and new commercial client relationships, client focused treasury management product offerings, and deposit movements reflecting our clients’ desire to hold greater liquidity in this economic environment.

The Company’s investment securities portfolio was $2.3 billion at December 31, 2011, compared to $1.9 billion at December 31, 2010, and $2.2 billion at September 30, 2011. Net unrealized gains were $73.6 million, compared to $32.0 million at the end of the fourth quarter 2010 and $74.2 million at the end of the third quarter 2011. The change in net unrealized gains compared to the prior year was primarily due to the decrease in interest rates. The securities portfolio is primarily composed of U.S. government agency backed mortgage pools, agency collateralized mortgage obligations, and investment grade municipal bonds.

Capital

As of December 31, 2011, the total risk-based capital ratio was 14.28 percent, the Tier 1 risk-based capital ratio was 12.38 percent, and the leverage ratio was 11.33 percent. Tier 1 common capital ratio was 8.04 percent and tangible common equity ratio was 7.69 percent at the end of the fourth quarter 2011.

Quarterly Conference Call and Webcast Presentation

PrivateBancorp will host a conference call on Tuesday, January 24, 2012, at 10 a.m. CT. The call may be accessed by telephone at (888) 782-9127 (U.S. and Canada) or (706) 634-5643 (International) and entering passcode # 38453385. A live webcast of the call can be accessed on the Company website at www.theprivatebank.com by visiting the Investor Relations tab under the About Us section. A rebroadcast will be available beginning approximately two hours after the call until midnight on January 26, 2012, by calling (855) 859-2056 (U.S. and Canada) or (404) 537-3406 (International) and entering passcode # 38453385.

About PrivateBancorp, Inc.

PrivateBancorp, Inc., through its subsidiaries, delivers customized business and personal financial services to middle-market companies, as well as business owners, executives, entrepreneurs and families in all of the markets and communities we serve. As of December 31, 2011, the Company had 34 offices in 10 states and $12.4 billion in assets. The Company website is www.theprivatebank.com.

Forward-Looking Statements

Statements contained in this press release that are not historical facts may constitute forward-looking statements within the meaning of federal securities laws. Our ability to predict results or the actual effects of future plans, strategies or events is inherently uncertain. Factors which could cause actual results to differ from those reflected in forward-looking statements include, but are not limited to: unforeseen credit quality problems or further deterioration in problem assets that could result in charge-offs greater than we have anticipated in our allowance for loan losses; adverse developments impacting one or more large credits; the extent of further deterioration in real estate values in our market areas, particularly in the Chicago area; difficulties in resolving problem credits or slower than anticipated dispositions of OREO which may result in increased losses or higher credit costs; continued uncertainty regarding U.S. and global economic recovery and economic outlook, and ongoing volatility in market conditions, that may impact credit quality or prolong weakness in demand for loans or other banking products and services; weakness in the commercial and industrial sector; unanticipated withdrawals of significant client deposits; lack of sufficient or cost-effective sources of liquidity or funding; the terms and availability of capital when and to the extent necessary or required to repay TARP or otherwise; loss of key personnel or an inability to recruit and retain appropriate talent; unanticipated changes in interest rates or significant tightening of credit spreads; competitive pricing pressures; uncertainty regarding implications of the Dodd-Frank Act and the rules and regulations to be adopted in connection with implementation of the legislation, including evolving regulatory capital standards; other legislative, regulatory or accounting changes affecting financial services companies and/or the products and services offered by financial services companies; uncertainties related to potential costs associated with pending litigation; or failures or disruptions to our data processing or other information or operational systems.

These factors should be considered in evaluating forward-looking statements and undue reliance should not be placed on our forward-looking statements. Forward-looking statements speak only as of the date they are made, and the Company assumes no obligation to update publicly any of these statements in light of future events unless required under the federal securities laws.

Non-GAAP Measures

This press release contains both financial measures based on accounting principles generally accepted in the United States (GAAP) and non-GAAP based financial measures. The Company believes that these non-GAAP financial measures provide information useful to investors in understanding the underlying operational performance of the Company, its business, and performance trends and facilitates comparisons with the performance of others in the banking industry. If non-GAAP financial measures are used, the comparable GAAP financial measure, as well as the reconcilement to the comparable GAAP financial measure, can be found in this press release. These disclosures should not be viewed as a substitute for operating results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies.

Editor’s Note: Financial highlights attached.

Exhibit 99.1

Consolidated Income Statements

(Amounts in thousands except per share data)


	Three Months Ended				Years Ended
	December 31,				December 31,
	2011		2010		2011		2010
	unaudited		unaudited		unaudited		audited
Interest Income
Loans, including fees	$	102,897	$	105,375	$	413,109	$	434,884
Federal funds sold and other short-term investments		215		366		1,181		1,950
Securities:
Taxable		15,263		15,453		61,417		64,316
Exempt from Federal income taxes		1,273		1,644		5,439		6,775

Total interest income		119,648		122,838		481,146		507,925

Interest Expense
Interest-bearing demand deposits		585		702		2,439		3,148
Savings deposits and money market accounts		4,857		7,437		22,957		34,431
Brokered and time deposits		5,561		7,367		24,676		36,458
Short-term borrowings		152		962		2,011		5,088
Long-term debt		5,511		6,023		21,936		27,843

Total interest expense		16,666		22,491		74,019		106,968

Net interest income		102,982		100,347		407,127		400,957
Provision for loan and covered loan losses		31,611		35,166		132,897		194,541

Net interest income after provision for loan and covered loan losses		71,371		65,181		274,230		206,416

Non-interest Income
Trust and Investments		3,992		4,574		17,826		18,140
Mortgage banking		3,032		3,479		6,703		10,187
Capital markets products		5,471		6,791		19,341		14,286
Treasury management		5,283		4,625		19,923		16,920
Loan and credit-related fees		5,606		4,710		22,207		16,526
Other income, service charges, and fees		1,645		1,377		6,476		5,005
Net securities gains		364		9,309		5,771		12,182

Total non-interest income		25,393		34,865		98,247		93,246

Non-interest Expense
Salaries and employee benefits		40,729		38,577		156,763		149,863
Net occupancy expense		7,394		7,385		29,986		29,935
Technology and related costs		3,142		2,447		11,388		10,224
Marketing		2,250		1,997		8,911		8,501
Professional services		2,126		3,020		9,206		12,931
Outsourced servicing costs		2,077		1,950		8,001		7,807
Net foreclosed property expenses		6,862		7,028		27,782		15,192
Postage, telephone, and delivery		953		1,049		3,716		3,659
Insurance		3,462		8,348		21,287		26,534
Loan and collection expense		3,840		4,029		13,571		14,623
Other expenses		3,395		6,318		11,666		20,329

Total non-interest expense		76,230		82,148		302,277		299,598

Income before income taxes		20,534		17,898		70,200		64
Income tax provision (benefit)		9,468		5,919		25,660		(1,737	)

Net income		11,066		11,979		44,540		1,801
Net income attributable to noncontrolling interests		7		67		170		284

Net income attributable to controlling interests		11,059		11,912		44,370		1,517
Preferred stock dividends and discount accretion		3,430		3,409		13,690		13,607

Net income (loss) available to common stockholders	$	7,629	$	8,503	$	30,680	$	(12,090	)

Per Common Share Data
Basic	$	0.11	$	0.12	$	0.43	$	(0.17	)
Diluted	$	0.11	$	0.12	$	0.43	$	(0.17	)
Common dividends per share	$	0.01	$	0.01	$	0.04	$	0.04
Weighted-average common shares outstanding		70,540		70,098		70,449		70,024
Weighted-average diluted common shares outstanding		70,713		70,135		70,642		70,024

Note 1:

Due to the net loss available to common stockholders reported for the year ended December 31, 2010, all potentially dilutive common stock equivalents were excluded from the diluted net loss per share computation as their inclusion would have been antidilutive.

Note 2:

Certain reclassifications have been made to prior period financial statements to place them on a basis comparable with the current period financial statements.

Quarterly Consolidated Income Statements

Unaudited

(Amounts in thousands except per share data)


	4Q11		3Q11		2Q11		1Q11		4Q10
Interest Income
Loans, including fees	$	102,897	$	102,174	$	102,391	$	105,647	$	105,375
Federal funds sold and other short-term investments		215		231		399		336		366
Securities:
Taxable		15,263		15,196		15,568		15,390		15,453
Exempt from Federal income taxes		1,273		1,293		1,387		1,486		1,644

Total interest income		119,648		118,894		119,745		122,859		122,838

Interest Expense
Interest-bearing demand deposits		585		625		587		642		702
Savings deposits and money market accounts		4,857		5,356		6,082		6,662		7,437
Brokered and time deposits		5,561		5,895		6,528		6,692		7,367
Short-term borrowings		152		466		566		827		962
Long-term debt		5,511		5,463		5,479		5,483		6,023

Total interest expense		16,666		17,805		19,242		20,306		22,491

Net interest income		102,982		101,089		100,503		102,553		100,347
Provision for loan and covered loan losses		31,611		32,615		31,093		37,578		35,166

Net interest income after provision for loan and covered loan losses		71,371		68,474		69,410		64,975		65,181

Non-interest Income
Trust and Investments		3,992		4,452		4,720		4,662		4,574
Mortgage banking		3,032		1,565		704		1,402		3,479
Capital markets products		5,471		5,510		3,871		4,489		6,791
Treasury management		5,283		5,016		4,873		4,751		4,625
Loan and credit-related fees		5,606		5,413		5,290		5,898		4,710
Other income, service charges, and fees		1,645		1,309		1,464		2,058		1,377
Net securities gains		364		4,370		670		367		9,309

Total non-interest income		25,393		27,635		21,592		23,627		34,865

Non-interest Expense
Salaries and employee benefits		40,729		38,841		38,636		38,557		38,577
Net occupancy expense		7,394		7,515		7,545		7,532		7,385
Technology and related costs		3,142		2,856		2,729		2,661		2,447
Marketing		2,250		2,218		2,500		1,943		1,997
Professional services		2,126		2,434		2,312		2,334		3,020
Outsourced servicing costs		2,077		1,918		1,852		2,154		1,950
Net foreclosed property expenses		6,862		7,129		7,485		6,306		7,028
Postage, telephone, and delivery		953		944		931		888		1,049
Insurance		3,462		5,393		5,092		7,340		8,348
Loan and collection expense		3,840		2,931		4,247		2,553		4,029
Other expenses		3,395		2,855		2,335		3,081		6,318

Total non-interest expense		76,230		75,034		75,664		75,349		82,148

Income before income taxes		20,534		21,075		15,338		13,253		17,898
Income tax provision		9,468		7,593		6,320		2,279		5,919

Net income		11,066		13,482		9,018		10,974		11,979
Net income attributable to noncontrolling interests		7		33		58		72		67

Net income attributable to controlling interests		11,059		13,449		8,960		10,902		11,912
Preferred stock dividends and discount accretion		3,430		3,426		3,419		3,415		3,409

Net income available to common stockholders	$	7,629	$	10,023	$	5,541	$	7,487	$	8,503

Per Common Share Data
Basic	$	0.11	$	0.14	$	0.08	$	0.10	$	0.12
Diluted	$	0.11	$	0.14	$	0.08	$	0.10	$	0.12
Common dividends per share	$	0.01	$	0.01	$	0.01	$	0.01	$	0.01
Weighted-average common shares outstanding		70,540		70,479		70,428		70,347		70,098
Weighted-average diluted common shares outstanding		70,713		70,621		70,663		70,396		70,135

Consolidated Balance Sheets

(Dollars in thousands)


	12/31/11			09/30/11			06/30/11			03/31/11			12/31/10
	unaudited			unaudited			unaudited			unaudited			audited
Assets
Cash and due from banks	$	156,131		$	171,268		$	160,289		$	181,738		$	112,772
Fed funds sold and other short-term investments		205,610			248,559			457,422			621,206			541,316
Loans held for sale		32,049			24,126			13,503			22,611			30,758
Securities available-for-sale, at fair value		1,783,465			1,872,587			2,057,290			1,892,304			1,881,786
Securities held-to-maturity, at amortized cost		490,143			273,200			—			—			—
Non-marketable equity investments		43,604			43,894			20,406			23,490			23,537
Loans—excluding covered assets, net of unearned fees		9,008,561			8,674,955			8,672,642			9,037,067			9,114,357
Allowance for loan losses		(191,594	)		(200,041	)		(206,286	)		(218,237	)		(222,821	)

Loans, net of allowance for loan losses and unearned fees		8,816,967			8,474,914			8,466,356			8,818,830			8,891,536

Covered assets		306,807			318,973			346,452			364,372			397,210
Allowance for covered loan losses		(25,939	)		(16,689	)		(16,904	)		(19,738	)		(15,334	)

Covered assets, net of allowance for covered loan losses		280,868			302,284			329,548			344,634			381,876

Other real estate owned, excluding covered assets		125,729			116,364			123,997			93,770			88,728
Premises, furniture, and equipment, net		38,633			39,069			38,171			39,019			40,975
Accrued interest receivable		35,732			32,686			32,128			33,960			33,854
Investment in bank owned life insurance		50,966			50,565			50,183			49,799			49,408
Goodwill		94,571			94,584			94,596			94,609			94,621
Other intangible assets		15,353			15,715			16,089			16,464			16,840
Capital markets derivative assets		101,676			111,248			93,453			87,273			100,250
Other assets		145,373			148,798			161,946			177,735			177,364

Total assets	$	12,416,870		$	12,019,861		$	12,115,377		$	12,497,442		$	12,465,621

Liabilities
Demand deposits:
Noninterest-bearing	$	3,244,307		$	2,832,481		$	2,527,230		$	2,438,709		$	2,253,661
Interest-bearing		595,238			611,293			531,107			540,215			616,761
Savings deposits and money market accounts		4,378,220			4,392,697			4,497,297			4,831,253			4,821,823
Brokered deposits		815,951			902,002			1,342,422			1,467,196			1,450,827
Time deposits		1,359,138			1,370,190			1,336,212			1,348,603			1,392,357

Total deposits		10,392,854			10,108,663			10,234,268			10,625,976			10,535,429
Short-term borrowings		156,000			59,154			63,311			88,468			118,561
Long-term debt		379,793			379,793			409,793			409,793			414,793
Accrued interest payable		5,567			5,841			5,767			5,529			5,968
Capital markets derivative liabilities		104,140			113,968			95,043			88,351			102,018
Other liabilities		81,764			66,266			46,547			41,193			60,942

Total liabilities		11,120,118			10,733,685			10,854,729			11,259,310			11,237,711

Equity
Preferred stock—Series B		240,403			240,020			239,642			239,270			238,903
Common stock		71,483			71,220			71,155			71,036			70,972
Treasury stock		(21,454	)		(20,680	)		(20,615	)		(20,312	)		(20,054	)
Additional paid-in capital		968,787			965,640			963,156			959,135			954,977
Accumulated deficit		(9,164	)		(16,075	)		(25,388	)		(30,223	)		(36,999	)
Accumulated other comprehensive income, net of tax		46,697			46,051			32,535			19,121			20,078

Total stockholders’ equity		1,296,752			1,286,176			1,260,485			1,238,027			1,227,877

Noncontrolling interests		—			—			163			105			33

Total equity		1,296,752			1,286,176			1,260,648			1,238,132			1,227,910

Total liabilities and equity	$	12,416,870		$	12,019,861		$	12,115,377		$	12,497,442		$	12,465,621

Selected Financial Data

Unaudited

(Amounts in thousands except per share data)


	4Q11			3Q11			2Q11			1Q11			4Q10
Selected Statement of Income Data:
Net interest income	$	102,982		$	101,089		$	100,503		$	102,553		$	100,347
Net revenue ^{(1) (2)}	$	129,045		$	129,404		$	122,811		$	126,970		$	136,088
Operating profit ^{(1) (2)}	$	52,815		$	54,370		$	47,147		$	51,621		$	53,940
Provision for loan and covered loan losses	$	31,611		$	32,615		$	31,093		$	37,578		$	35,166
Income before taxes	$	20,534		$	21,075		$	15,338		$	13,253		$	17,898
Net income available to common stockholders	$	7,629		$	10,023		$	5,541		$	7,487		$	8,503

Per Common Share Data:
Basic earnings per share	$	0.11		$	0.14		$	0.08		$	0.10		$	0.12
Diluted earnings per share	$	0.11		$	0.14		$	0.08		$	0.10		$	0.12
Dividends	$	0.01		$	0.01		$	0.01		$	0.01		$	0.01
Book value (period end) ⁽¹⁾	$	14.72		$	14.57		$	14.22		$	13.98		$	13.87
Tangible book value (period end) ^{(1) (2)}	$	13.19		$	13.04		$	12.68		$	12.43		$	12.30
Market value (close)	$	10.98		$	7.52		$	13.80		$	15.29		$	14.38
Book value multiple		0.75	x		0.52	x		0.97	x		1.09	x		1.04	x

Share Data:
Weighted average common shares outstanding		70,540			70,479			70,428			70,347			70,098
Diluted average common shares outstanding		70,713			70,621			70,663			70,396			70,135
Common shares issued (at period end)		72,514			72,491			72,497			72,096			71,979
Common shares outstanding (at period end)		71,745			71,789			71,808			71,428			71,327

Performance Ratios:
Return on average assets		0.36	%		0.44	%		0.29	%		0.35	%		0.38	%
Return on average common equity		2.86	%		3.80	%		2.18	%		3.03	%		3.31	%
Net interest margin ^{(1) (2)}		3.48	%		3.49	%		3.36	%		3.46	%		3.33	%
Covered asset accretion contribution to net interest margin		0.00	%		0.03	%		0.03	%		0.05	%		0.05	%
Net interest margin, excluding impact of covered asset accretion		3.48	%		3.46	%		3.33	%		3.41	%		3.28	%
Fee revenue as a percent of total revenue ⁽¹⁾		19.55	%		18.71	%		17.23	%		18.49	%		20.30	%
Non-interest income to average assets		0.82	%		0.91	%		0.69	%		0.77	%		1.11	%
Non-interest expense to average assets		2.45	%		2.46	%		2.43	%		2.44	%		2.61	%
Net overhead ratio ⁽¹⁾		1.64	%		1.56	%		1.74	%		1.68	%		1.50	%
Efficiency ratio^{(1) (2)}		59.07	%		57.98	%		61.61	%		59.34	%		60.36	%

Selected Information:
Assets under management and administration ⁽¹⁾	$	4,303,547		$	4,161,614		$	4,395,516		$	4,313,843		$	4,271,602
Credit valuation adjustment on capital markets derivatives⁽¹⁾	$	244		$	(1,207	)	$	(573	)	$	817		$	1,826

Balance Sheet Ratios:
Loans to Deposits (period end)⁽³⁾		86.68	%		85.82	%		84.74	%		85.05	%		86.51	%
Average interest-earning assets to average interest-bearing liabilities		150.70	%		145.30	%		139.77	%		134.88	%		134.76	%

Capital Ratios (period end):
Total risk-based capital ^{(1) (4)}		14.28	%		14.82	%		15.12	%		14.55	%		14.18	%
Tier 1 risk-based capital ^{(1) (4)}		12.38	%		12.89	%		12.95	%		12.41	%		12.06	%
Leverage⁽¹⁾		11.33	%		11.48	%		11.00	%		10.91	%		10.78	%
Tier 1 common capital ^{(1) (2) (4)}		8.04	%		8.34	%		8.34	%		7.97	%		7.69	%
Tangible common equity to tangible assets ^{(1) (2)}		7.69	%		7.86	%		7.58	%		7.17	%		7.10	%
Total equity to total assets		10.44	%		10.70	%		10.41	%		9.91	%		9.85	%

(1)

Refer to Glossary of Terms for definition.

(2)

This is a non-U.S. GAAP measure, refer to Non-U.S. GAAP Measures for a reconciliation from non-U.S. GAAP to U.S. GAAP.

(3)

Excludes covered assets. Refer to Glossary of Terms for definition.

(4)

This has been revised from the third quarter 2011 presentation due to correction of a mathematical computation.

Loan Composition (excluding covered assets⁽¹⁾)

(Dollars in thousands)


	12/31/11		% of Total			09/30/11		% of Total			06/30/11		% of Total			03/31/11		% of Total			12/31/10		% of Total
	unaudited					unaudited					unaudited					unaudited					audited
Commercial and industrial	$	4,264,738		47	%	$	4,024,142		46	%	$	3,946,624		46	%	$	4,030,035		45	%	$	3,967,548		44	%
Commercial—owner-occupied CRE		1,135,023		13	%		1,072,250		12	%		988,540		11	%		990,342		11	%		897,620		10	%

Total commercial		5,399,761		60	%		5,096,392		58	%		4,935,164		57	%		5,020,377		56	%		4,865,168		54	%

Commercial real estate		2,186,340		24	%		2,114,585		24	%		2,238,122		26	%		2,339,098		26	%		2,448,632		26	%
Commercial real estate—multi-family		424,119		5	%		421,045		5	%		397,291		5	%		451,685		5	%		457,246		5	%

Total commercial real estate		2,610,459		29	%		2,535,630		29	%		2,635,413		31	%		2,790,783		31	%		2,905,878		31	%

Construction		287,002		3	%		315,858		4	%		366,061		4	%		464,253		5	%		530,733		6	%
Residential real estate		297,229		3	%		307,705		4	%		301,250		3	%		314,082		3	%		319,146		4	%
Home equity		181,158		2	%		186,914		2	%		190,691		2	%		188,900		2	%		197,179		2	%
Personal		232,952		3	%		232,456		3	%		244,063		3	%		258,672		3	%		296,253		3	%

Total loans	$	9,008,561		100	%	$	8,674,955		100	%	$	8,672,642		100	%	$	9,037,067		100	%	$	9,114,357		100	%

LOGO

(1)

Refer to Glossary of Terms for definition.

Note:

Certain reclassifications have been made to prior period presentation of loan portfolio composition to place them on a basis comparable with current period classification.

Loan Composition (excluding covered assets⁽¹⁾)

(Dollars in thousands)

Unaudited

Commercial Loans Composition by Industry Segment

(Classified pursuant to the North American Industrial Classification System Standard industry descriptions and represents our client’s primary business activity)


	12/31/11					09/30/11					12/31/10
			% of					% of					% of
	Amount		Total			Amount		Total			Amount		Total
Manufacturing	$	1,257,973		23	%	$	1,184,660		23	%	$	1,042,963		21	%
Healthcare and social assistance		1,218,205		23	%		1,127,665		22	%		1,007,610		21	%
Wholesale trade		482,386		9	%		520,626		10	%		482,747		10	%
Finance and insurance		454,830		8	%		373,369		7	%		449,692		9	%
Real estate and rental and leasing		416,961		8	%		364,873		7	%		368,742		8	%
Professional, scientific, and technical services		350,677		6	%		264,146		5	%		298,382		6	%
Administrative, support, waste management and remediation services		321,912		6	%		333,681		7	%		301,735		6	%
Architectural, engineering and construction		197,761		4	%		240,576		5	%		230,062		5	%
All other segments ⁽²⁾		699,056		13	%		686,796		14	%		683,235		14	%

Total commercial	$	5,399,761		100	%	$	5,096,392		100	%	$	4,865,168		100	%

Commercial Real Estate and Construction Loans Portfolio by Collateral Type


	12/31/11								09/30/11								12/31/10
			% of			%					% of			%					% of
	Amount		Total			Nonperforming			Amount		Total			Nonperforming			Amount		Total
Commercial Real Estate Portfolio
Land	$	230,579		9	%		6	%	$	239,778		9	%		9	%	$	311,464		11	%
Residential 1-4 family		105,919		4	%		23	%		116,007		5	%		23	%		139,689		5	%
Multi-family		424,119		16	%		1	%		421,045		17	%		1	%		457,246		16	%
Industrial/warehouse		343,071		13	%		3	%		340,968		13	%		6	%		391,694		13	%
Office		568,302		22	%		4	%		527,404		21	%		2	%		531,193		18	%
Retail		431,200		17	%		8	%		405,307		16	%		10	%		452,119		16	%
Health care		140,942		5	%		—			87,377		3	%		—			114,545		4	%
Mixed use/other		366,327		14	%		7	%		397,744		16	%		11	%		507,927		17	%

Total commercial real estate	$	2,610,459		100	%		5	%	$	2,535,630		100	%		7	%	$	2,905,877		100	%

Construction Portfolio
Land	$	23,422		8	%		2	%	$	51,394		16	%		1	%	$	46,036		9	%
Residential 1-4 family		21,906		8	%		14	%		24,812		8	%		27	%		30,698		6	%
Multi-family		64,892		23	%		—			50,064		16	%		*			77,685		15	%
Industrial/warehouse		15,216		5	%		—			26,488		8	%		*			34,703		7	%
Office		43,403		15	%		1	%		41,253		13	%		1	%		92,369		17	%
Retail		61,469		21	%		20	%		60,035		19	%		26	%		92,268		17	%
Mixed use/other		56,694		20	%		10	%		61,812		20	%		11	%		156,974		29	%

Total construction	$	287,002		100	%		8	%	$	315,858		100	%		9	%	$	530,733		100	%

LOGO

(1)

Refer to Glossary of Terms for definition.

(2)

All other segments consist of numerous smaller balances across a variety of industries.

*—	Less than 1%.

Note:

Certain reclassifications have been made to prior period presentation of loan portfolio composition to place them on a basis comparable with current period classification.

Asset Quality (excluding covered assets⁽¹⁾)

Unaudited

(Dollars in thousands)


	4Q11			3Q11			2Q11			1Q11			4Q10
Credit Quality Key Ratios
Net charge-offs (annualized) to average loans		1.72	%		1.76	%		1.95	%		1.83	%		1.54	%
Nonperforming loans to total loans		2.88	%		3.51	%		3.81	%		3.95	%		4.01	%
Nonperforming loans to total assets		2.09	%		2.54	%		2.73	%		2.86	%		2.94	%
Nonperforming assets to total assets		3.11	%		3.50	%		3.75	%		3.61	%		3.65	%
Allowance for loan losses to:
Total loans		2.13	%		2.31	%		2.38	%		2.41	%		2.44	%
Nonperforming loans		74	%		66	%		62	%		61	%		61	%

Nonperforming assets
Loans past due 90 days and accruing	$	—		$	—		$	—		$	—		$	—
Nonaccrual loans		259,852			304,747			330,448			356,932			365,880
OREO		125,729			116,364			123,997			93,770			88,728

Total nonperforming assets	$	385,581		$	421,111		$	454,445		$	450,702		$	454,608

Restructured loans accruing interest	$	100,909		$	106,330		$	124,614		$	100,895		$	87,576

Special mention loans	$	204,965		$	218,561		$	227,413		$	275,519		$	398,834
Potential problem loans	$	177,095		$	277,125		$	392,019		$	518,144		$	507,590

Nonperforming Loans Rollforward
Beginning balance	$	304,747		$	330,448		$	356,932		$	365,880		$	371,156
Additions:
New nonaccrual loans		67,512			68,298			110,438			95,275			108,526
Reductions:
Return to performing status		(2,072	)		(1,608	)		(2,781	)		(11,059	)		(6,564	)
Paydowns and payoffs, net of advances		(8,950	)		(13,166	)		(8,258	)		(16,301	)		(18,852	)
Net sales		(27,178	)		(20,432	)		(38,129	)		(11,288	)		(10,595	)
Transfer to OREO		(33,695	)		(24,373	)		(49,667	)		(23,655	)		(39,795	)
Charge-offs, net		(40,512	)		(34,420	)		(38,087	)		(41,920	)		(37,996	)

Total reductions		(112,407	)		(93,999	)		(136,922	)		(104,223	)		(113,802	)

Balance at end of period	$	259,852		$	304,747		$	330,448		$	356,932		$	365,880

OREO Rollforward
Beginning balance	$	116,364		$	123,997		$	93,770		$	88,728		$	90,944
New foreclosed property		33,695			24,373			49,667			23,661			40,178
Valuation adjustments		(3,999	)		(1,175	)		(5,483	)		(4,762	)		(1,994	)
Disposals:
Sales proceeds		(18,085	)		(25,921	)		(13,615	)		(12,277	)		(40,076	)
Net loss on sale		(2,246	)		(4,910	)		(342	)		(1,580	)		(324	)

Balance at end of period	$	125,729		$	116,364		$	123,997		$	93,770		$	88,728

Restructured Loans Accruing Interest Rollforward
Beginning balance	$	106,330		$	124,614		$	100,895		$	87,576		$	53,397
Additions:
New restructured loans accruing interest		8,803			8,592			54,663			19,328			45,582
Return to performing status		1,099			1,029			—			—			—
Reductions:
Paydowns and payoffs, net of advances		(3,334	)		(20,545	)		(7,915	)		(1,535	)		1,034
Move to nonperforming loans		(5,735	)		(4,716	)		(9,930	)		(4,474	)		(12,437	)
Net sales		—			(2,260	)		(9,600	)		—			—
Charge-offs, net		—			(44	)		(3,499	)		—			—
Removal of restructured loan status		(6,254	)		(340	)		—			—			—

Balance at end of period	$	100,909		$	106,330		$	124,614		$	100,895		$	87,576

(1)

Refer to Glossary of Terms for definition.

Asset Quality (excluding covered assets⁽¹⁾)

Unaudited

(Dollars in thousands)

Credit Quality Indicators ⁽¹⁾


						Potential					Non-
	Special		% of			Problem		% of			Performing		% of			Total
	Mention		Loan Type			Loans		Loan Type			Loans		Loan Type			Loans
As of December 31, 2011
Transformational ⁽¹⁾
Commercial	$	41,995		0.8	%	$	66,279		1.3	%	$	49,220		1.0	%	$	4,941,935
Commercial real estate		59,031		3.9	%		1,769		0.1	%		49,031		3.3	%		1,497,661
Construction		7,272		3.6	%		9,283		4.6	%		12,489		6.2	%		201,879
Residential real estate		4,490		3.5	%		5,450		4.2	%		2,844		2.2	%		129,161
Home equity		—		—			381		0.7	%		78		0.1	%		54,530
Personal		—		—			866		0.6	%		330		0.2	%		139,643

Total transformational	$	112,788		1.6	%	$	84,028		1.2	%	$	113,992		1.6	%	$	6,964,809

Legacy ⁽¹⁾
Commercial	$	12,331		2.7	%	$	13,049		2.9	%	$	16,738		3.7	%	$	457,826
Commercial real estate		73,884		6.6	%		60,424		5.4	%		84,226		7.6	%		1,112,798
Construction		—		—			—		—			9,390		11.0	%		85,123
Residential real estate		4,854		2.9	%		12,481		7.4	%		11,745		7.0	%		168,068
Home equity		758		0.6	%		6,003		4.7	%		11,525		9.1	%		126,628
Personal		350		0.4	%		1,110		1.2	%		12,236		13.1	%		93,309

Total legacy		92,177		4.5	%		93,067		4.6	%		145,860		7.1	%		2,043,752

Total	$	204,965		2.3	%	$	177,095		2.0	%	$	259,852		2.9	%	$	9,008,561


As of September 30, 2011
Transformational ⁽¹⁾
Commercial	$	44,086		1.0	%	$	102,460		2.2	%	$	45,575		1.0	%	$	4,610,520
Commercial real estate		53,069		4.0	%		38,808		2.9	%		43,606		3.3	%		1,331,001
Construction		10,129		4.8	%		9,283		4.4	%		12,579		6.0	%		210,904
Residential real estate		—		—			8,212		6.7	%		403		0.3	%		121,913
Home equity		—		—			424		1.0	%		—		—			43,965
Personal		3,934		3.1	%		810		0.6	%		346		0.3	%		127,483

Total transformational	$	111,218		1.7	%	$	159,997		2.5	%	$	102,509		1.6	%	$	6,445,786
Legacy ⁽¹⁾
Commercial	$	10,718		2.2	%	$	25,558		5.3	%	$	15,824		3.3	%	$	485,872
Commercial real estate		88,396		7.3	%		70,111		5.8	%		124,472		10.3	%		1,204,629
Construction		—		—			342		0.3	%		17,418		16.6	%		104,954
Residential real estate		5,427		2.9	%		12,163		6.5	%		17,604		9.5	%		185,792
Home equity		1,595		1.1	%		8,145		5.7	%		13,440		9.4	%		142,949
Personal		1,207		1.1	%		809		0.8	%		13,480		12.8	%		104,973

Total legacy		107,343		4.8	%		117,128		5.3	%		202,238		9.1	%		2,229,169

Total	$	218,561		2.5	%	$	277,125		3.2	%	$	304,747		3.5	%	$	8,674,955

(1)

Refer to Glossary of Terms for definition.

Note:

Certain reclassifications have been made to prior period presentation of loan portfolio composition to place them on a basis comparable with current period classification.

Asset Quality (excluding covered assets⁽¹⁾)

Unaudited

(Dollars in thousands)

Nonaccrual Loans Stratification


	$10.0 Million or More		$5.0 to $9.9 Million		$3.0 to $4.9 Million		$1.5 to $2.9 Million		Under $1.5 Million		Total
As of December 31, 2011
Amount:
Commercial	$	30,226	$	16,820	$	3,448	$	3,434	$	12,030	$	65,958
Commercial real estate		56,969		10,257		15,740		21,549		28,742		133,257
Construction		12,490		—		4,760		1,547		3,082		21,879
Residential real estate		—		—		4,789		2,473		7,327		14,589
Personal and home equity		—		7,108		—		3,795		13,266		24,169

Total	$	99,685	$	34,185	$	28,737	$	32,798	$	64,447	$	259,852

Number of borrowers:
Commercial		2		2		1		2		39		46
Commercial real estate		4		2		4		10		56		76
Construction		1		—		1		1		5		8
Residential real estate		—		—		1		1		19		21
Personal and home equity		—		1		—		2		37		40

Total		7		5		7		16		156		191

As of September 30, 2011
Amount:
Commercial	$	24,511	$	20,883	$	—	$	1,793	$	14,212	$	61,399
Commercial real estate		47,643		34,231		19,031		31,557		35,616		168,078
Construction		12,490		—		7,866		5,183		4,458		29,997
Residential real estate		—		—		7,789		—		10,218		18,007
Personal and home equity		—		7,869		—		2,165		17,232		27,266

Total	$	84,644	$	62,983	$	34,686	$	40,698	$	81,736	$	304,747

Number of borrowers:
Commercial		2		3		—		1		40		46
Commercial real estate		3		6		5		15		64		93
Construction		1		—		2		2		8		13
Residential real estate		—		—		2		—		21		23
Personal and home equity		—		1		—		1		37		39

Total		6		10		9		19		170		214

Restructured Loans Accruing Interest Stratification


	$10.0 Million or More		$5.0 to $9.9 Million		$3.0 to $4.9 Million		$1.5 to $2.9 Million		Under $1.5 Million		Total
As of December 31, 2011
Amount:
Commercial	$	15,279	$	24,264	$	4,331	$	—	$	3,894	$	47,768
Commercial real estate		21,273		5,165		—		4,944		4,767		36,149
Construction		—		—		—		—		—		—
Residential real estate		—		—		—		2,213		1,025		3,238
Personal and home equity		12,691		—		—		—		1,063		13,754

Total	$	49,243	$	29,429	$	4,331	$	7,157	$	10,749	$	100,909

Number of borrowers:
Commercial		1		4		1		—		10		16
Commercial real estate		1		1		—		2		10		14
Construction		—		—		—		—		—		—
Residential real estate		—		—		—		1		2		3
Personal and home equity		1		—		—		—		2		3

Total		3		5		1		3		24		36

As of September 30, 2011
Amount:
Commercial	$	15,540	$	24,650	$	3,563	$	1,692	$	4,708	$	50,153
Commercial real estate		21,415		5,187		—		7,778		6,703		41,083
Construction		—		—		—		—		—		—
Residential real estate		—		—		—		—		1,063		1,063
Personal and home equity		12,788		—		—		—		1,243		14,031

Total	$	49,743	$	29,837	$	3,563	$	9,470	$	13,717	$	106,330

Number of borrowers:
Commercial		1		4		1		1		14		21
Commercial real estate		1		1		—		3		11		16
Construction		—		—		—		—		—		—
Residential real estate		—		—		—		—		2		2
Personal and home equity		1		—		—		—		3		4

Total		3		5		1		4		30		43

(1)

Refer to Glossary of Terms for definition.

Note:

Certain reclassifications have been made to prior period presentation of loan portfolio composition to place them on a basis comparable with current period classification.

Loan Portfolio Aging (excluding covered assets⁽¹⁾)

Unaudited

(Dollars in thousands)


	Current			30-59 Days Past Due			60-89 Days Past Due			90 Days Past Due and Accruing		Nonaccrual			Total Loans
As of December 31, 2011
Loan balances:
Commercial	$	5,326,862		$	6,018		$	923		$	—	$	65,958		$	5,399,761
Commercial real estate		2,463,902			3,523			9,777			—		133,257			2,610,459
Construction		262,742			—			2,381			—		21,879			287,002
Residential real estate		278,195			3,800			645			—		14,589			297,229
Personal and home equity		388,686			446			809			—		24,169			414,110

Total loans	$	8,720,387		$	13,787		$	14,535		$	—	$	259,852		$	9,008,561

Aging as a percent of loan balance:
Commercial		98.65	%		0.11	%		0.02	%		—		1.22	%		100.00	%
Commercial real estate		94.40	%		0.13	%		0.37	%		—		5.10	%		100.00	%
Construction		91.55	%		—			0.83	%		—		7.62	%		100.00	%
Residential real estate		93.59	%		1.28	%		0.22	%		—		4.91	%		100.00	%
Personal and home equity		93.85	%		0.11	%		0.20	%		—		5.84	%		100.00	%

Total loans		96.81	%		0.15	%		0.16	%		—		2.88	%		100.00	%


	4Q11			3Q11			2Q11			1Q11			4Q10
Nonaccrual loans:
Commercial	$	65,958		$	61,399		$	51,634		$	66,529		$	70,241
Commercial real estate		133,257			168,078			192,778			202,836			214,629
Construction		21,879			29,997			37,140			41,643			33,403
Residential real estate		14,589			18,007			18,496			16,869			14,841
Personal and home equity		24,169			27,266			30,400			29,055			32,766

Total	$	259,852		$	304,747		$	330,448		$	356,932		$	365,880

Nonaccrual loans as a percent of total loan type:
Commercial		1.22	%		1.20	%		1.05	%		1.33	%		1.44	%
Commercial real estate		5.10	%		6.63	%		7.31	%		7.27	%		7.39	%
Construction		7.62	%		9.50	%		10.15	%		8.97	%		6.29	%
Residential real estate		4.91	%		5.85	%		6.14	%		5.37	%		4.65	%
Personal and home equity		5.84	%		6.50	%		6.99	%		6.49	%		6.64	%

Total		2.88	%		3.51	%		3.81	%		3.95	%		4.01	%

Loans past due 60-89 days and still accruing:
Commercial	$	923		$	101		$	3,978		$	139		$	759
Commercial real estate		9,777			8,801			10,292			6,782			12,346
Construction		2,381			—			—			—			1,895
Residential real estate		645			2,864			1,000			396			4,098
Personal and home equity		809			1,016			1,288			2,935			4,033

Total	$	14,535		$	12,782		$	16,558		$	10,252		$	23,131

Loans past due 60-89 days and still accruing as a percent of total loan type:
Commercial		0.02	%		*			0.08	%		*			0.02	%
Commercial real estate		0.37	%		0.35	%		0.39	%		0.24	%		0.43	%
Construction		0.83	%		—			—			—			0.36	%
Residential real estate		0.22	%		0.93	%		0.33	%		0.13	%		1.28	%
Personal and home equity		0.20	%		0.24	%		0.30	%		0.66	%		0.82	%

Total		0.16	%		0.15	%		0.19	%		0.11	%		0.25	%

Loans past due 30-59 days and still accruing:
Commercial	$	6,018		$	3,529		$	1,723		$	3,997		$	1,024
Commercial real estate		3,523			5,884			3,384			23,409			10,264
Construction		—			342			—			4,835			—
Residential real estate		3,800			7			392			753			180
Personal and home equity		446			776			2,803			1,921			14,098

Total	$	13,787		$	10,538		$	8,302		$	34,915		$	25,566

Loans past due 30-59 days and still accruing as a percent of total loan type:
Commercial		0.11	%		0.07	%		0.03	%		0.08	%		0.02	%
Commercial real estate		0.13	%		0.23	%		0.13	%		0.84	%		0.35	%
Construction		—			0.11	%		—			1.04	%		—
Residential real estate		1.28	%		*			0.13	%		0.24	%		0.06	%
Personal and home equity		0.11	%		0.19	%		0.64	%		0.43	%		2.86	%

Total		0.15	%		0.12	%		0.10	%		0.39	%		0.28	%

(1)

Refer to Glossary of Terms for definition.

*	Less than 0.1%.

Note:

Certain reclassifications have been made to prior period presentation of loan portfolio composition to place them on a basis comparable with current period classification.

Foreclosed Real Estate (OREO), excluding covered assets⁽¹⁾

Unaudited

(Dollars in thousands)

OREO Properties by Type


	December 31, 2011							September 30, 2011							December 31, 2010
	Number of Properties		Amount		% of Total			Number of Properties		Amount		% of Total			Number of Properties		Amount		% of Total
Single family homes		71	$	26,866		21	%		75	$	22,821		19	%		24	$	21,534		24	%
Land parcels		262		51,465		41	%		243		55,998		48	%		320		34,122		38	%
Multi-family		14		3,327		3	%		11		5,476		5	%		14		6,061		7	%
Office/industrial		44		37,019		29	%		28		24,243		21	%		20		26,511		30	%
Retail		9		7,052		6	%		7		7,826		7	%		1		500		1	%

Total		400	$	125,729		100	%		364	$	116,364		100	%		379	$	88,728		100	%

OREO Property Location


	Illinois			Georgia			Michigan			South Eastern⁽²⁾			Mid Western ⁽³⁾			Other			Total
December 31, 2011
Single family homes	$	23,277		$	385		$	1,718		$	—		$	608		$	878		$	26,866
Land parcels		29,370			2,898			3,171			9,568			6,458			—			51,465
Multi-family		3,327			—			—			—			—			—			3,327
Office/industrial		18,430			1,656			548			3,762			9,228			3,395			37,019
Retail		4,501			1,615			936			—			—			—			7,052

Total	$	78,905		$	6,554		$	6,373		$	13,330		$	16,294		$	4,273		$	125,729

% of Total		63	%		5	%		5	%		11	%		13	%		3	%		100	%
September 30, 2011
Single family homes	$	19,240		$	1,259		$	1,408		$	—		$	914		$	—		$	22,821
Land parcels		35,409			2,951			2,874			9,568			5,196			—			55,998
Multi-family		3,202			—			1,702			—			572			—			5,476
Office/industrial		14,864			1,012			548			3,762			4,057			—			24,243
Retail		5,807			892			1,127			—			—			—			7,826

Total	$	78,522		$	6,114		$	7,659		$	13,330		$	10,739		$	—		$	116,364

% of Total		68	%		5	%		7	%		11	%		9	%		0	%		100	%
December 31, 2010
Single family homes	$	14,943		$	139		$	6,194		$	—		$	258		$	—		$	21,534
Land parcels		10,874			4,772			3,626			10,396			4,454			—			34,122
Multi-family		5,166			—			895			—			—			—			6,061
Office/industrial		13,505			1,104			3,787			4,573			3,542			—			26,511
Retail		500			—			—			—			—			—			500

Total	$	44,988		$	6,015		$	14,502		$	14,969		$	8,254		$	—		$	88,728

% of Total		51	%		7	%		16	%		17	%		9	%		0	%		100	%

(1)

Refer to Glossary of Terms for definition.

(2)

Represents the southeastern states of Arkansas and Florida.

(3)

Represents the midwestern states of Kansas, Missouri, Wisconsin, Indiana and Ohio.

Allowance for Loan Losses (excluding covered assets⁽¹⁾)

Unaudited

(Dollars in thousands)


	4Q11			3Q11			2Q11			1Q11			4Q10
Change in allowance for loan losses:
Balance at beginning of period	$	200,041		$	206,286		$	218,237		$	222,821		$	223,392
Loans charged-off:
Commercial	$	(12,991	)	$	(5,039	)	$	(10,512	)	$	(4,200	)	$	(3,050	)
Commercial real estate		(24,083	)		(29,920	)		(25,402	)		(29,409	)		(21,909	)
Construction		(1,526	)		(1,419	)		(8,275	)		(62	)		(1,709	)
Residential real estate		(1,203	)		(234	)		(186	)		(386	)		(544	)
Home equity		(1,340	)		(3,291	)		(508	)		(1,447	)		(1,234	)
Personal		(290	)		(2,083	)		(434	)		(6,787	)		(8,602	)

Total charge-offs		(41,433	)		(41,986	)		(45,317	)		(42,291	)		(37,048	)

Recoveries on loans previously charged-off:
Commercial	$	830		$	2,278		$	707		$	465		$	1,243
Commercial real estate		1,410			969			511			272			75
Construction		109			29			56			97			274
Residential real estate		10			9			40			2			12
Home equity		300			12			15			10			79
Personal		544			103			312			155			259

Total recoveries		3,203			3,400			1,641			1,001			1,942

Net charge-offs		(38,230	)		(38,586	)		(43,676	)		(41,290	)		(35,106	)
Provisions charged to operating expense		29,783			32,341			31,725			36,706			34,535

Balance at end of period	$	191,594		$	200,041		$	206,286		$	218,237		$	222,821

Allocation of allowance for loan losses:
General allocated reserve:
Commercial	$	46,500		$	45,000		$	46,000		$	50,250		$	52,100
Commercial real estate		56,000			60,000			67,000			75,500			72,850
Construction		7,650			10,450			9,600			12,900			16,000
Residential real estate		5,400			5,800			5,400			4,425			4,275
Home equity		2,750			3,500			3,500			3,425			3,150
Personal		3,350			3,100			3,100			3,325			3,475

Total allocated	$	121,650		$	127,850		$	134,600		$	149,825		$	151,850
Specific reserve		69,944			72,191			71,686			68,412			70,971

Total	$	191,594		$	200,041		$	206,286		$	218,237		$	222,821

Allocation of reserve by a percent of total allowance for loan losses:
General allocated reserve:
Commercial		24	%		22	%		22	%		23	%		23	%
Commercial real estate		29	%		30	%		32	%		35	%		33	%
Construction		4	%		5	%		5	%		6	%		7	%
Residential real estate		3	%		3	%		3	%		2	%		2	%
Home equity		1	%		2	%		2	%		2	%		1	%
Personal		2	%		2	%		2	%		2	%		2	%

Total allocated		63	%		64	%		66	%		70	%		68	%
Specific reserve		37	%		36	%		34	%		30	%		32	%

Total		100	%		100	%		100	%		100	%		100	%

Allowance for loan losses to:
Total loans		2.13	%		2.31	%		2.38	%		2.41	%		2.44	%
Nonperforming loans		74	%		66	%		62	%		61	%		61	%

(1)

Refer to Glossary of Terms for definition.

Deposits

(Dollars in thousands)


	12/31/11		% of Total			09/30/11		% of Total			06/30/11		% of Total			03/31/11		% of Total			12/31/10		% of Total
	unaudited					unaudited					unaudited					unaudited					audited
Noninterest-bearing deposits	$	3,244,307		31	%	$	2,832,481		28	%	$	2,527,230		25	%	$	2,438,709		23	%	$	2,253,661		21	%
Interest-bearing deposits		595,238		6	%		611,293		6	%		531,107		5	%		540,215		5	%		616,761		6	%
Savings deposits		210,138		2	%		214,610		2	%		202,427		2	%		203,550		2	%		190,685		2	%
Money market accounts		4,168,082		40	%		4,178,087		41	%		4,294,870		42	%		4,627,703		44	%		4,631,138		44	%
Brokered deposits:
Traditional		20,499		*			60,665		1	%		277,628		3	%		455,473		4	%		329,107		3	%
Client CDARS⁽¹⁾		795,452		8	%		841,337		8	%		956,094		9	%		888,676		8	%		852,458		8	%
Non-client CDARS⁽¹⁾		—		0	%		—		0	%		108,700		1	%		123,047		1	%		269,262		3	%

Total brokered deposits		815,951		8	%		902,002		9	%		1,342,422		13	%		1,467,196		13	%		1,450,827		14	%
Time deposits		1,359,138		13	%		1,370,190		14	%		1,336,212		13	%		1,348,603		13	%		1,392,357		13	%

Total deposits	$	10,392,854		100	%	$	10,108,663		100	%	$	10,234,268		100	%	$	10,625,976		100	%	$	10,535,429		100	%

Client deposits⁽¹⁾	$	10,372,355		100	%	$	10,047,998		99	%	$	9,847,940		96	%	$	10,047,456		95	%	$	9,937,060		94	%

*	Less than 1%.

LOGO

(1)

Refer to Glossary of Terms for definition.

Net Interest Margin

Unaudited

(Dollars in thousands)


	Three Months Ended December 31,
	2011								2010
	Average Balance			Interest ⁽¹⁾		Yield/ Rate			Average Balance			Interest ⁽¹⁾		Yield/ Rate
Assets:
Fed funds sold and other short-term investments	$	334,758		$	215		0.25	%	$	570,264		$	366		0.25	%
Securities:
Taxable		2,064,044			15,263		2.96	%		1,718,338			15,453		3.60	%
Tax-exempt ⁽²⁾		141,405			1,944		5.49	%		164,241			2,520		6.14	%

Total securities		2,205,449			17,207		3.12	%		1,882,579			17,973		3.82	%

Loans, excluding covered assets:
Commercial		5,320,119			62,775		4.62	%		4,699,681			53,922		4.49	%
Commercial real estate		2,493,296			27,224		4.27	%		2,966,730			31,960		4.22	%
Construction		302,632			2,920		3.78	%		549,967			5,261		3.74	%
Residential		344,002			3,450		4.01	%		366,637			4,239		4.62	%
Personal and home equity		416,873			3,784		3.60	%		495,845			4,482		3.59	%

Total loans, excluding covered assets ⁽³⁾		8,876,922			100,153		4.42	%		9,078,860			99,864		4.31	%

Total interest-earning assets before covered assets⁽²⁾		11,417,129			117,575		4.05	%		11,531,703			118,203		4.03	%
Covered assets ⁽⁴⁾		279,612			2,744		3.85	%		387,146			5,511		5.57	%

Total interest-earning assets⁽²⁾		11,696,741		$	120,319		4.04	%		11,918,849		$	123,714		4.08	%

Cash and due from banks		154,163								143,504
Allowance for loan and covered loan losses		(220,356	)							(240,720	)
Other assets		700,647								692,026

Total assets	$	12,331,195							$	12,513,659

Liabilities and Equity:
Interest-bearing demand deposits	$	599,273		$	585		0.39	%	$	696,877		$	702		0.40	%
Savings deposits		210,577			167		0.32	%		184,704			206		0.44	%
Money market accounts		4,253,934			4,690		0.44	%		4,812,571			7,231		0.60	%
Time deposits		1,369,150			4,054		1.17	%		1,427,904			4,954		1.38	%
Brokered deposits		893,860			1,507		0.67	%		1,165,207			2,413		0.82	%

Total interest-bearing deposits		7,326,794			11,003		0.60	%		8,287,263			15,506		0.74	%
Short-term borrowings		55,206			152		1.08	%		124,716			962		3.02	%
Long-term debt		379,793			5,511		5.76	%		432,264			6,023		5.53	%

Total interest-bearing liabilities		7,761,793			16,666		0.85	%		8,844,243			22,491		1.01	%

Noninterest-bearing demand deposits		3,101,145								2,224,807
Other liabilities		170,546								185,437
Equity		1,297,711								1,259,172

Total liabilities and equity	$	12,331,195							$	12,513,659

Net interest spread ^{(2) (5)}							3.19	%							3.07	%
Effect of non interest-bearing funds							0.29	%							0.26	%

Net interest income/margin ^{(2) (5) (6)}				$	103,653		3.48	%				$	101,223		3.33	%

(1)

Interest income included $6.5 million and $5.1 million in loan fees for the three months ended December 31, 2011 and 2010, respectively.

(2)

Interest income and yields are presented on a tax-equivalent basis, assuming a federal income tax rate of 35%. This is a non-U.S. GAAP measure. Refer to Non-U.S. GAAP Measures for a reconciliation of the effect of the tax-equivalent adjustment.

(3)

Average loans on a nonaccrual basis for the recognition of interest income totaled $291.1 million and $389.1 million for the three months ended December 31, 2011 and 2010, respectively, and are included in loans for purposes of this analysis. Interest foregone on impaired loans was estimated to be approximately $3.2 million and $4.2 million for the three months ended December 31, 2011 and 2010, respectively, and was based on the average loan portfolio yield for the respective period.

(4)

Covered interest-earning assets consist of loans acquired through an FDIC-assisted transaction that are subject to a loss share agreement and the related indemnification asset.

(5)

Refer to Glossary of Terms for definition.

(6)

For the three months ended December 31, 2010, accretion related to covered assets contributed to net interest margin by 5 basis points. There was no benefit to net interest margin for the three months ended December 31, 2011.

Note: Prior period net interest margin computations were modified to conform with the current period presentation.

Net Interest Margin

Unaudited

(Dollars in thousands)


	Three Months Ended December 31, 2011								Three Months Ended September 30, 2011
	Average Balance			Interest ⁽¹⁾		Yield/ Rate			Average Balance			Interest ⁽¹⁾		Yield/ Rate
Assets:
Fed funds sold and other short-term investments	$	334,758		$	215		0.25	%	$	373,705		$	231		0.24	%
Securities:
Taxable		2,064,044			15,263		2.96	%		1,935,653			15,196		3.14	%
Tax-exempt ⁽²⁾		141,405			1,944		5.49	%		132,716			1,973		5.95	%

Total securities		2,205,449			17,207		3.12	%		2,068,369			17,169		3.32	%

Loans, excluding covered assets:
Commercial		5,320,119			62,775		4.62	%		5,079,470			60,936		4.69	%
Commercial real estate		2,493,296			27,224		4.27	%		2,511,749			26,590		4.14	%
Construction		302,632			2,920		3.78	%		361,764			3,492		3.78	%
Residential		344,002			3,450		4.01	%		315,244			3,411		4.33	%
Personal and home equity		416,873			3,784		3.60	%		429,632			3,879		3.58	%

Total loans, excluding covered assets ⁽³⁾		8,876,922			100,153		4.42	%		8,697,859			98,308		4.43	%

Total interest-earning assets before covered assets⁽²⁾		11,417,129			117,575		4.05	%		11,139,933			115,708		4.08	%
Covered assets ⁽⁴⁾		279,612			2,744		3.85	%		306,390			3,866		4.95	%

Total interest-earning assets⁽²⁾		11,696,741		$	120,319		4.04	%		11,446,323		$	119,574		4.11	%

Cash and due from banks		154,163								153,020
Allowance for loan and covered loan losses		(220,356	)							(232,501	)
Other assets		700,647								718,891

Total assets	$	12,331,195							$	12,085,733


Liabilities and Equity:
Interest-bearing demand deposits	$	599,273		$	585		0.39	%	$	597,741		$	625		0.42	%
Savings deposits		210,577			167		0.32	%		210,191			210		0.40	%
Money market accounts		4,253,934			4,690		0.44	%		4,183,937			5,146		0.49	%
Time deposits		1,369,150			4,054		1.17	%		1,335,757			4,087		1.21	%
Brokered deposits		893,860			1,507		0.67	%		1,083,815			1,808		0.66	%

Total interest-bearing deposits		7,326,794			11,003		0.60	%		7,411,441			11,876		0.64	%
Short-term borrowings		55,206			152		1.08	%		60,283			466		3.02	%
Long-term debt		379,793			5,511		5.76	%		405,880			5,463		5.34	%

Total interest-bearing liabilities		7,761,793			16,666		0.85	%		7,877,604			17,805		0.90	%

Noninterest-bearing demand deposits		3,101,145								2,747,760
Other liabilities		170,546								174,937
Equity		1,297,711								1,285,432

Total liabilities and equity	$	12,331,195							$	12,085,733

Net interest spread ^(2) (5)							3.19	%							3.21	%
Effect of non interest-bearing funds							0.29	%							0.28	%

Net interest income/margin ^{(2) (5) (6)}				$	103,653		3.48	%				$	101,769		3.49	%

(1)

Interest income included $6.5 million and $6.4 million in loan fees for the three months ended December 31, 2011 and September 30, 2011, respectively.

(2)

(3)

Average loans on a nonaccrual basis for the recognition of interest income totaled $291.1 million and $329.7 million for the three months ended December 31, 2011 and September 30, 2011, respectively, and are included in loans for purposes of this analysis. Interest foregone on impaired loans was estimated to be approximately $3.2 million and $3.5 million for the three months ended December 31, 2011 and September 30, 2011, respectively, and was based on the average loan portfolio yield for the respective period.

(4)

Covered interest-earning assets consist of loans acquired through an FDIC-assisted transaction that are subject to a loss share agreement and the related indemnification asset.

(5)

Refer to Glossary of Terms for definition.

(6)

For the three months ended September 30, 2011, accretion related to covered assets contributed to net interest margin by 3 basis points. There was no benefit to net interest margin for the three months ended December 31, 2011.

Net Interest Margin

Unaudited

(Dollars in thousands)


	Years Ended December 31,
	2011								2010
	Average Balance			Interest ⁽¹⁾		Yield/ Rate			Average Balance			Interest ⁽¹⁾		Yield/ Rate
Assets:
Fed funds sold and other short-term investments	$	463,742		$	1,181		0.25	%	$	733,841		$	1,950		0.27	%
Securities:
Taxable		1,891,173			61,417		3.25	%		1,654,885			64,316		3.89	%
Tax-exempt ⁽²⁾		140,707			8,296		5.90	%		165,535			10,352		6.25	%

Total securities		2,031,880			69,713		3.43	%		1,820,420			74,668		4.10	%

Loans, excluding covered assets:
Commercial		5,130,839			240,123		4.68	%		4,442,350			206,013		4.64	%
Commercial real estate		2,640,297			112,091		4.25	%		3,080,086			133,903		4.35	%
Construction		397,771			14,937		3.76	%		620,937			22,047		3.55	%
Residential		325,606			14,070		4.32	%		349,494			16,546		4.73	%
Personal and home equity		438,266			15,751		3.59	%		508,274			19,163		3.77	%

Total loans, excluding covered assets ⁽³⁾		8,932,779			396,972		4.44	%		9,001,141			397,672		4.42	%

Total interest-earning assets before covered assets⁽²⁾		11,428,401			467,866		4.09	%		11,555,402			474,290		4.10	%
Covered assets ⁽⁴⁾		317,631			16,137		5.08	%		422,962			37,212		8.80	%

Total interest-earning assets⁽²⁾		11,746,032		$	484,003		4.12	%		11,978,364		$	511,502		4.27	%

Cash and due from banks		158,655								152,346
Allowance for loan and covered loan losses		(237,038	)							(244,484	)
Other assets		685,475								669,219

Total assets	$	12,353,124							$	12,555,445

Liabilities and Equity:
Interest-bearing demand deposits	$	587,453		$	2,439		0.42	%	$	699,598		$	3,148		0.45	%
Savings deposits		205,814			786		0.38	%		170,268			948		0.56	%
Money market accounts		4,413,971			22,171		0.50	%		4,690,019			33,483		0.71	%
Time deposits		1,354,246			16,947		1.25	%		1,499,713			22,387		1.49	%
Brokered deposits		1,210,424			7,729		0.64	%		1,341,254			14,071		1.05	%

Total interest-bearing deposits		7,771,908			50,072		0.64	%		8,400,852			74,037		0.88	%
Short-term borrowings		74,918			2,011		2.68	%		180,439			5,088		2.82	%
Long-term debt		401,779			21,936		5.46	%		476,400			27,843		5.84	%

Total interest-bearing liabilities		8,248,605			74,019		0.90	%		9,057,691			106,968		1.18	%

Noninterest-bearing demand deposits		2,669,924								2,083,874
Other liabilities		163,756								166,742
Equity		1,270,839								1,247,138

Total liabilities and equity	$	12,353,124							$	12,555,445

Net interest spread ^{(2) (5)}							3.22	%							3.09	%
Effect of non interest-bearing funds							0.27	%							0.29	%

Net interest income/margin ^{(2) (5) (6)}				$	409,984		3.49	%				$	404,534		3.38	%

(1)

Interest income included $24.4 million and $21.3 million in loan fees for the years ended December 31, 2011 and 2010, respectively.

(2)

(3)

Average loans on a nonaccrual basis for the recognition of interest income totaled $340.7 million and $400.1 million for the years ended December 31, 2011 and 2010, respectively, and are included in loans for purposes of this analysis. Interest foregone on impaired loans was estimated to be approximately $14.4 million and $17.2 million for the years ended December 31, 2011 and 2010, respectively, and was based on the average loan portfolio yield for the respective period.

(4)

Covered interest-earning assets consist of loans acquired through an FDIC-assisted transaction that are subject to a loss share agreement and the related indemnification asset.

(5)

Refer to Glossary of Terms for definition.

(6)

For the years ended December 31, 2011 and 2010, accretion related to covered assets contributed to net interest margin by 2 and 15 basis points, respectively.

Non-U.S. GAAP Measures

Unaudited

(Amounts in thousands except per share data)

This press release contains both financial measures based on accounting principles generally accepted in the United States (U.S. GAAP) and non-U.S. GAAP based financial measures. These non-U.S. GAAP measures include net interest income, net interest margin, net revenue, operating profit and efficiency ratio all on a fully taxable-equivalent basis; tier 1 common equity to risk-weighted assets, tangible equity to tangible assets, tangible equity to risk-weighted assets, tangible common equity to tangible assets, and tangible book value. We believe that presenting these non-U.S. GAAP financial measures will provide information useful to investors in understanding our underlying operational performance, our business, and performance trends and facilitates comparisons with the performance of others in the banking industry.

We use net interest income on a taxable-equivalent basis in calculating various performance measures by increasing the interest income earned on tax-exempt assets to make it fully equivalent to interest income earned on taxable investments assuming a 35% tax rate. Management believes this measure to be the preferred industry measurement of net interest income as it enhances comparability to net interest income arising from taxable and tax-exempt sources, and accordingly believes that providing this measure may be useful for peer comparison purposes.

We also consider various measures when evaluating capital utilization and adequacy, including tier 1 common equity to risk-weighted assets, tangible equity to tangible assets, tangible equity to risk-weighted assets, tangible common equity to tangible assets, and tangible book value. These calculations are intended to complement the capital ratios defined by banking regulators for both absolute and comparative purposes. Certain of these measures exclude from capital the ending balances of goodwill and other intangibles and/or preferred capital components. Because U.S. GAAP does not include capital ratio measures, we believe there are no comparable U.S. GAAP financial measures to these ratios. We believe these non-U.S. GAAP measures are relevant because they reflect the level of capital available to withstand unexpected market conditions. Additionally, presentation of these measures allows readers to compare certain aspects of our capitalization to other companies. However, because there are no standardized definitions for these ratios, our calculations may not be comparable with other companies, and the usefulness of these measures to investors may be limited.

Non-U.S. GAAP financial measures have inherent limitations, are not required to be uniformly applied, and are not audited. Although these non-U.S. GAAP financial measures are frequently used by stakeholders in the evaluation of a company, they have limitations as analytical tools, and should not be considered in isolation or as a substitute for analyses of results as reported under U.S. GAAP. As a result, we encourage readers to consider our Consolidated Financial Statements in their entirety and not to rely on any single financial measure. The following table reconciles Non-U.S. GAAP financial measures to U.S. GAAP:


	Quarters Ended
	4Q11			3Q11			2Q11			1Q11			4Q10
Taxable-equivalent interest income
U.S. GAAP net interest income	$	102,982		$	101,089		$	100,503		$	102,553		$	100,347
Taxable-equivalent adjustment		671			680			716			790			876

Taxable-equivalent net interest income (a)	$	103,653		$	101,769		$	101,219		$	103,343		$	101,223

Average Earning Assets (b)	$	11,696,741		$	11,446,323		$	11,916,038		$	11,930,751		$	11,918,849

Net Interest Margin ((a) annualized) / (b)		3.48	%		3.49	%		3.36	%		3.46	%		3.33	%

Net Revenue
Taxable-equivalent net interest income (a)	$	103,653		$	101,769		$	101,219		$	103,343		$	101,223
U.S. GAAP non-interest income		25,393			27,635			21,592			23,627			34,865

Net revenue	$	129,046		$	129,404		$	122,811		$	126,970		$	136,088

Operating Profit
U.S. GAAP income before income taxes	$	20,534		$	21,075		$	15,338		$	13,253		$	17,898
Provision for loan and covered loan losses		31,611			32,615			31,093			37,578			35,166
Taxable-equivalent adjustment		671			680			716			790			876

Operating profit	$	52,816		$	54,370		$	47,147		$	51,621		$	53,940

Efficiency Ratio
U.S. GAAP non-interest expense (c)	$	76,230		$	75,034		$	75,664		$	75,349		$	82,148
Taxable-equivalent net interest income (a)	$	103,653		$	101,769		$	101,219		$	103,343		$	101,223
U.S. GAAP non-interest income		25,393			27,635			21,592			23,627			34,865

Net revenue (d)	$	129,046		$	129,404		$	122,811		$	126,970		$	136,088

Efficiency ratio (c) / (d)		59.07	%		57.98	%		61.61	%		59.34	%		60.36	%

Non-U.S. GAAP Measures (continued)

Unaudited

(Amounts in thousands except per share data)


	Years Ended December 31,
	2011			2010
Taxable-equivalent interest income
U.S. GAAP net interest income	$	407,127		$	400,957
Taxable-equivalent adjustment		2,857			3,577

Taxable-equivalent net interest income (a)	$	409,984		$	404,534

Average Earning Assets (b)	$	11,746,032		$	11,978,364
Net Interest Margin ((a) annualized) / (b)		3.49	%		3.38	%
Net Revenue
Taxable-equivalent net interest income (a)	$	409,984		$	404,534
U.S. GAAP non-interest income		98,247			93,246

Net revenue	$	508,231		$	497,780

Operating Profit
U.S. GAAP income before income taxes	$	70,200		$	64
Provision for loan and covered loan losses		132,897			194,541
Taxable-equivalent adjustment		2,857			3,577

Operating profit	$	205,954		$	198,182

Efficiency Ratio
U.S. GAAP non-interest expense (c)	$	302,277		$	299,598
Taxable-equivalent net interest income (a)	$	409,984		$	404,534
U.S. GAAP non-interest income		98,247			93,246

Net revenue (d)	$	508,231		$	497,780

Efficiency ratio (c) / (d)		59.48	%		60.19	%


	Quarters Ended
	4Q11			3Q11			2Q11			1Q11			4Q10
Tier 1 Common Capital
U.S. GAAP total equity	$	1,296,752		$	1,286,176		$	1,260,648		$	1,238,132		$	1,227,910
Trust preferred securities		244,793			244,793			244,793			244,793			244,793
Less: accumulated other comprehensive income, net of tax		46,697			46,051			32,535			19,121			20,078
Less: disallowed deferred tax assets		—			—			—			—			5,377
Less: goodwill		94,571			94,584			94,596			94,609			94,621
Less: other intangibles		15,353			15,715			16,089			16,464			16,840

Tier 1 risk-based capital		1,384,924			1,374,619			1,362,221			1,352,731			1,335,787
Less: preferred stock		240,403			240,020			239,642			239,270			238,903
Less: trust preferred securities		244,793			244,793			244,793			244,793			244,793
Less: noncontrolling interests		—			—			163			105			33

Tier 1 common capital (e)	$	899,728		$	889,806		$	877,623		$	868,563		$	852,058

Tangible Common Equity
U.S. GAAP total equity	$	1,296,752		$	1,286,176		$	1,260,648		$	1,238,132		$	1,227,910
Less: goodwill		94,571			94,584			94,596			94,609			94,621
Less: other intangibles		15,353			15,715			16,089			16,464			16,840

Tangible equity (f)		1,186,828			1,175,877			1,149,963			1,127,059			1,116,449
Less: preferred stock		240,403			240,020			239,642			239,270			238,903

Tangible common equity (g)	$	946,425		$	935,857		$	910,321		$	887,789		$	877,546

Tangible Assets
U.S. GAAP total assets	$	12,416,870		$	12,019,861		$	12,115,377		$	12,497,442		$	12,465,621
Less: goodwill		94,571			94,584			94,596			94,609			94,621
Less: other intangibles		15,353			15,715			16,089			16,464			16,840

Tangible assets (h)	$	12,306,946		$	11,909,562		$	12,004,692		$	12,386,369		$	12,354,160

Risk-weighted Assets (i)⁽¹⁾	$	11,191,298		$	10,665,256		$	10,518,850		$	10,903,625		$	11,080,051

Period-end Shares Outstanding (j)		71,745			71,789			71,808			71,428			71,327

Ratios:
Tier 1 common equity to risk-weighted assets (e) / (i)⁽¹⁾		8.04	%		8.34	%		8.34	%		7.97	%		7.69	%
Tangible equity to tangible assets (f) / (h)		9.64	%		9.87	%		9.58	%		9.10	%		9.04	%
Tangible equity to risk-weighted assets (f) / (i) ⁽¹⁾		10.60	%		11.03	%		10.93	%		10.34	%		10.08	%
Tangible common equity to tangible assets (g) / (h)		7.69	%		7.86	%		7.58	%		7.17	%		7.10	%
Tangible book value (g) / (j)	$	13.19		$	13.04		$	12.68		$	12.43		$	12.30

(1)

This has been revised from the third quarter 2011 presentation due to correction of a mathematical computation.

Glossary of Terms

Assets under management and administration (“AUMA”)—Assets held in trust where we serve as trustee or in accounts where we make investment decisions on behalf of clients. AUMA also includes non-managed assets we hold in custody for clients or for which we receive fees for advisory or brokerage services. We do not include these assets on our Consolidated Balance Sheets.

Book value—Total common equity divided by outstanding shares of common stock at end of period.

CDARS^® deposit program—is a deposit services arrangement that effectively achieves FDIC deposit insurance for jumbo deposit relationships. These deposits are classified as brokered deposits for regulatory reporting purposes; however, we classify these deposits as client CDARS^® due to the source being our client relationships and are, therefore, not traditional ‘brokered’ deposits. We also participate in a non-client CDARS^® program that is more like a traditional brokered deposit program in that our relationship is not with the underlying depositor.

Client deposits—Total deposits less brokered deposits plus client CDARS^TM.

Common equity—Total equity less preferred stock.

Covered assets—Assets acquired through an FDIC-assisted transaction that are subject to a loss share agreement and are presented separately on the Consolidated Balance Sheets.

Credit quality indicators—The Company has adopted an internal risk rating policy in which each loan is rated for credit quality with a numerical rating of 1 through 8. Loans rated 5 and better (1-5 ratings, inclusive) are credits that exhibit acceptable financial performance, cash flow, and leverage. If any risk exists, we attempt to mitigate by structure, collateral, monitoring, or other meaningful controls. Credits rated 6 are considered special mention as these credits demonstrate potential weakness and that if left unresolved, may result in deterioration in the Company’s credit position and/or the repayment prospects for the credit. Borrowers rated special mention may exhibit adverse operating trends, high leverage, tight liquidity or other credit concerns. Potential problem loans have a risk rating of 7 and are considered inadequately protected by the current net worth and paying capacity of the obligor, the collateral pledged, or guarantors. These loans generally have a well defined weakness or weaknesses that may jeopardize liquidation of the debt and are characterized by the distinct possibility that the Company will sustain some loss if the deficiencies are not resolved. Nonperforming loans include nonaccrual loans risk rated 7 or 8 and have all the weaknesses inherent in a 7-rated potential problem loan with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions and values, highly questionable and improbable. Special mention, potential problem and nonperforming loans are reviewed at minimum on a quarterly basis, while all other rated credits are reviewed as the situation warrants.

Credit valuation adjustment (“CVA”)—An adjustment may need to be incorporated into the valuation of derivative instruments for nonperformance risk to include the counterparty’s credit risk and the Company’s own credit risk. This adjustment is referred to as the CVA. The CVA represents the credit component of fair value with regard to both client-based trades and the related matched trades with interbank dealer counterparties.

Efficiency ratio—Total non-interest expense divided by the sum of net interest income on a tax equivalent basis and non-interest income. This is a non-U.S. GAAP financial measure.

Fee revenue as percent of total revenue ratio—Total non-interest income less net securities gains (losses) divided by the sum of net interest income and non-interest income less net securities gains (losses).

U.S. GAAP—Accounting principles generally accepted in the United States of America.

Net interest margin—Expressed as a percentage, net interest margin is a ratio computed as annualized taxable-equivalent net interest income divided by average interest-earning assets. The annualization of net interest income for the quarterly yield takes into consideration the interest payment convention at the product level. This is a non-U.S. GAAP financial measure.

Net interest spread—The difference between the average yield earned on interest-earning assets on a taxable-equivalent basis and the average rate paid for interest-bearing liabilities.

Net overhead ratio—Total non-interest expense less non-interest income divided by average total assets.

Net revenue—The sum of taxable equivalent net interest income and non-interest income. This is a non-U.S. GAAP financial measure.

Non-U.S. GAAP—Certain financial measures within this document that are not formally defined by U.S. GAAP or codified in the federal banking regulations. A reconciliation of these non-U.S. GAAP measures may be found on the previous two pages.

Operating profit—The sum of U.S. GAAP income before income taxes, provision for loan and covered loan losses and taxable-equivalent adjustment. This is a non-U.S. GAAP financial measure.

Risk-weighted assets—Computed by the assignment of specific risk-weights (as defined by the Board of Governors of the Federal Reserve System) to assets and off-balance sheet instruments.

Tangible book value—Total common equity less goodwill and other intangibles divided by outstanding shares of common stock at end of period. This is a non-U.S. GAAP financial measure.

Tangible common equity to tangible assets ratio—Tangible common equity divided by tangible assets, where tangible common equity equals total equity less preferred stock, goodwill and other intangible assets and tangible assets equals total assets less goodwill and other intangible assets. This is a non-U.S. GAAP financial measure.

Glossary of Terms (continued)

Taxable-equivalent interest income—The interest income earned on certain assets is completely or partially exempt from Federal income tax. As such, these tax-exempt instruments typically yield lower returns than taxable investments. To provide more meaningful comparisons of yields and margins for all interest-earning assets, we use interest income on a taxable-equivalent basis in calculating average yields and net interest margins by increasing the interest income earned on tax-exempt assets to make it fully equivalent to interest income earned on other taxable investments. This adjustment is not permitted under U.S. GAAP on the Consolidated Income Statement.

Tier 1 common capital—Tier 1 risk-based capital, less preferred equity, less trust preferred capital securities, and less noncontrolling interests.

Tier 1 common capital ratio—Tier 1 common capital divided by period-end risk-weighted assets. This is a non-U.S. GAAP financial measure.

Tier 1 risk-based capital—Total equity, plus trust preferred capital securities, plus certain noncontrolling interests that are held by others; less goodwill and certain other intangible assets, less equity investments in nonfinancial companies, less ineligible servicing assets, less disallowed deferred tax assets and less net unrealized holding gains (losses) on available for sale equity securities, available for sale debt securities, and cash flow hedge derivatives.

Tier 1 risk-based capital ratio—Tier 1 risk-based capital divided by period-end risk-weighted assets.

Leverage ratio—Tier 1 risk-based capital divided by adjusted average total assets.

Total risk-based capital—Tier 1 risk-based capital plus qualifying subordinated debt, other noncontrolling interest not qualified as Tier 1, eligible gains on available-for-sale equity securities and the allowance for loan and lease losses, subject to certain limitations.

Total risk-based capital ratio—Total risk-based capital divided by period-end risk-weighted assets.

Transformational and legacy portfolios—We aggregate loans by originating line of business for reserve purposes because of observable similarities in the performance experience of loans underwritten by the business units. Loans originated by the business units that existed prior to the strategic changes in 2007 are considered “legacy” loans. Loans originated by a business unit that was established in connection with or following the business transformation plan are considered “transformational” loans. Renewals or restructurings of legacy loans may continue to be evaluated as legacy loans depending on the structure or defining characteristics of the new transaction. The Company has implemented a line of business model that has reorganized the legacy business units so that after 2009, all new loan originations are considered transformational.

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