Exhibit 99.1

 

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 Second Quarter Earnings Per Share of $0.19

Earnings per share up 27 percent from first quarter driven by improved credit quality;

Total loans grew $214 million from prior quarter

CHICAGO, July 24, 2012 – PrivateBancorp, Inc. (NASDAQ: PVTB) today reported net income available to common shareholders of $14.1 million, or $0.19 per diluted share, for the second quarter 2012, compared to $5.5 million, or $0.08 per diluted share, for the second quarter 2011, and $10.8 million, or $0.15 per diluted share, for the first quarter 2012. For the six months ended June 30, 2012, the Company had net income available to common shareholders of $24.9 million, or $0.34 per diluted share, compared to $13.0 million, or $0.18 per diluted share, for the six months ended June 30, 2011.

“Continuing to build client relationships and driving overall asset quality improvement led to our highest quarterly profit since the launch of our commercial banking strategy in late 2007,” said Larry D. Richman, President and Chief Executive Officer, PrivateBancorp, Inc. “Persistently low interest rates, along with the competitive commercial banking landscape, have pressured our margins. Overall I am pleased with the steady execution of our strategy and the calling effort of our bankers, which is keeping our pipeline solid.

“I believe our performance over the past year demonstrates the strength of our core commercial business model. Compared to a year ago, total loans have increased more than $760 million, while problem loans have declined almost $470 million. Our consistent and focused business development efforts have helped us add clients and increase product sales, which have led to strong growth in treasury management, capital markets and mortgage. All of this helped drive higher net revenue and improved profits for the quarter as compared to second quarter 2011.”

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Highlights

 

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Net income was $14.1 million, up 30 percent from the first quarter 2012, largely as a result of lower provision for loan losses.

 

•

Net interest income of $105.3 million increased from $104.4 million in the first quarter 2012, as growth in loans offset the impact of net interest margin compression.

 

•

Operating profit of $48.4 million declined $3.9 million from first quarter 2012, primarily as a result of higher net foreclosed property expense.

 

•

Asset quality continued to improve during the quarter with non-performing, special mention and potential problem loans declining 14 percent from March 31, 2012. The provision for loan losses declined to $17.4 million, from $27.6 million in the first quarter of 2012.

 

•

Total loans grew $214.0 million to $9.4 billion at June 30, 2012, driven by growth in commercial and industrial loans from new relationships and existing clients, which now comprise 63 percent of the loan portfolio at quarter end.

Operating Performance

Net revenue was $132.3 million in the second quarter 2012, an increase of 8 percent compared to $122.8 million in the second quarter 2011, and relatively flat as compared to $132.6 million in the first quarter 2012. Operating profit was $48.4 million in the second quarter 2012, compared to $47.1 million in the same period prior year and $52.3 million in the prior quarter. For the second quarter 2012, operating profit declined primarily due to higher net foreclosed property expense, which included $9.2 million of valuation adjustments, with the majority of the adjustments relating to land parcels.

Net interest income was $105.3 million for the second quarter 2012, up 5 percent from $100.5 million for the second quarter 2011 and up 1 percent from $104.4 million for the first quarter 2012. Growth in average loan balances of 5 percent over the past year and the 12 basis point decline in funding costs contributed to a $4.8 million increase in net interest income as compared to the second quarter 2011. In comparison to the first quarter 2012, the 4 percent increase in average loan balances in the second quarter offset the impact of declining yields within the loan and investment portfolios.

Net interest margin was 3.46 percent for the second quarter 2012, up from 3.36 percent in the same period prior year and down from 3.53 percent in the prior quarter. The impact to net interest margin from loan fees this quarter was 4 basis points lower than in the prior quarter. While overall changes in the mix of the loan portfolio over the past year have been favorable to net interest margin, average yields on investments and new loan production are generally trending lower.

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Non-interest income was $26.2 million in the second quarter 2012, compared to $21.6 million in the second quarter 2011, and $27.5 million in the first quarter 2012. The 22 percent growth of non-interest income as compared to the second quarter of 2011 was a result of higher volumes in mortgage banking and treasury management, and increased capital markets revenue. Non-interest income declined compared to the first quarter 2012, from lower capital markets revenue. Second quarter capital markets revenue included a negative credit valuation adjustment of $830,000, whereas the first quarter results included a positive credit value adjustment of $19,000.

Expenses

Non-interest expense was $83.9 million for the second quarter 2012, compared to $75.7 million for the second quarter 2011 and $80.2 million for the first quarter 2012. The increase in non-interest expense was primarily driven by net foreclosed property expense, which was up 59 percent compared to the same period prior year and up 44 percent compared to the prior quarter. Net foreclosed property expense included $9.2 million of valuation adjustments.

The effective tax rate for the quarter was 43.0 percent and continues to be impacted by the non-deductibility of certain compensation expense as well as a reduction in tax benefits of previously awarded stock-based compensation. The Company continues to project an effective tax rate for the full year 2012 ranging from 41 to 42 percent.

Credit Quality

The Company’s asset quality continued to improve during the second quarter 2012. Non-performing assets declined to $319.2 million at June 30, 2012, down 30 percent from $454.4 million at June 30, 2011, and down 11 percent from $356.7 million at March 31, 2012. Non-performing assets to total assets were 2.47 percent at June 30, 2012, compared to 3.75 percent a year ago, and 2.83 percent at March 31, 2012. Non-performing loans were $209.3 million at the end of the second quarter 2012, a 37 percent decline from $330.4 million a year ago, and a 10 percent decline from $233.2 million at the end of the first quarter 2012. Non-performing loan inflows were $57.7 million during the second quarter 2012, down $11.9 million from the prior quarter. Special mention and potential problem loans declined 56 percent from the second quarter 2011, and 17 percent from the first quarter 2012. Based on ongoing workout and disposition activity, the Company expects problem assets will continue to trend lower in the second half of 2012, driving further improvement in asset quality metrics.

During the second quarter, the Company disposed of $50.8 million of problem assets, with an incremental charge of 2 percent based on the carrying value net of specific reserves at the time of disposition.

The reduction of the allowance for loan losses reflects the overall improvement in asset quality, the reduced requirement for specific reserves, lower charge-offs, and an increase of recoveries. At June 30, 2012, the allowance for loan losses was $174.3 million, or 1.85 percent of total loans, compared to

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$206.3 million, or 2.38 percent of total loans, at June 30, 2011, and $183.8 million, or 1.99 percent of total loans at March 31, 2012. As a percentage of non-performing loans the allowance for loan losses was 83 percent at the end of the second quarter 2012, compared to 62 percent a year ago, and 79 percent at the end of the first quarter 2012.

The Company benefited from $6.9 million of recoveries this quarter, compared to an average of $3.1 million over the last four quarters. Charge-offs declined to $33.9 million for the second quarter 2012, from $45.3 million for the same period prior year and $39.7 million for the prior quarter. The second quarter 2012 provision for loan losses was $17.4 million, excluding covered loan provision, down from $31.7 million in the same period prior year and $27.6 million in the prior quarter.

Credit quality results exclude $244.8 million in covered assets as of the end of the second quarter 2012, referring to certain assets acquired through an FDIC-assisted transaction that are subject to a loss-sharing agreement, compared to $346.5 million in the second quarter 2011 and $276.5 million in the first quarter 2012.

Balance Sheet

Total loans were $9.4 billion at June 30, 2012, compared to $9.2 billion at March 31, 2012. The 2 percent growth in total loans this quarter was primarily from new commercial and industrial relationships, while revolver usage has remained flat over the last several quarters. The Company funded $430.3 million in loans to new relationships during the second quarter 2012.

Commercial and industrial loans continued to grow from March 31, 2012, and comprised 63 percent of the total loan portfolio at June 30, 2012. Total assets were $12.9 billion at June 30, 2012, up from $12.6 billion at March 31, 2012.

Total deposits were $10.7 billion at June 30, 2012, up from $10.4 billion at March 31, 2012. Non-interest bearing deposits comprised 27 percent of total deposits at June 30, 2012, compared to 29 percent of total deposits at March 31, 2012. Brokered deposits were $1.5 billion, or 14 percent of total deposits, at June 30, 2012, as compared to $1.0 billion, or 9 percent of total deposits, at March 31, 2012.

The Company’s investment securities portfolio was $2.4 billion at June 30, 2012, compared to $2.3 billion at March 31, 2012. The securities portfolio is primarily comprised of U.S. government agency backed mortgage pools, agency collateralized mortgage obligations, and investment grade municipal bonds.

Capital

As of June 30, 2012, the Company’s total risk-based capital ratio was 14.12 percent, the Tier 1 risk-based capital ratio was 12.25 percent and the leverage ratio was 11.20 percent. Tier 1 common capital ratio was 8.05 percent and tangible common equity ratio was 7.67 percent at the end of the second quarter 2012.

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Quarterly Conference Call and Webcast Presentation

PrivateBancorp will host a conference call on Tuesday, July 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 #93482670. 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 July 26, 2012, by calling (855) 859-2056 (U.S. and Canada) or (404) 537-3406 (International) and entering passcode # 93482670.

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 June 30, 2012, the Company had 34 offices in 9 states and $12.9 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 other real estate owned which may result in increased losses or higher credit-related operating 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; unanticipated withdrawals of significant client deposits; the availability of cost-effective sources of liquidity or funding; the terms and availability of capital to the extent necessary to repay TARP preferred stock or otherwise required; loss of key personnel or an inability to recruit and retain appropriate talent; unanticipated changes in interest rates or significant tightening of credit spreads; increased competitive pricing pressures; uncertainty relating to recently proposed regulatory capital rules that could, depending on the nature of our assets, require us to maintain higher levels of regulatory capital; uncertainty regarding implications of recently adopted or proposed rules and regulations, or those remaining to be proposed in connection with implementation of the Dodd-Frank Act that may negatively affect our revenues or profitability; other legislative, regulatory or accounting changes affecting financial services companies and/or the products

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and services offered by financial services companies; or failures or disruptions to our data processing or other information or operational systems. Forward-looking statements are subject to risks, assumptions and uncertainties and could be significantly affected by many factors, including those set forth in the “Risk Factors” section of our Form 10-K for the year ended December 31, 2011 as well as those set forth in our subsequent periodic and current reports filed with the SEC. 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 we assume no obligation to update any of these statements in public filings 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.

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Consolidated Income Statements

(Amounts in thousands except per share data)

 

		Three Months Ended								Six Months Ended
		June 30,								June 30,
		2012				2011				2012				2011
		unaudited				unaudited				unaudited				unaudited
Interest Income
Loans, including fees		$	105,142			$	102,391			$	208,681			$	208,038
Federal funds sold and other short-term investments			133				399				265				735
Securities:
Taxable			14,854				15,568				30,234				30,958
Exempt from Federal income taxes			1,336				1,387				2,636				2,873
Total interest income			121,465				119,745				241,816				242,604
Interest Expense
Interest-bearing demand deposits			799				587				1,435				1,229
Savings deposits and money market accounts			4,265				6,082				8,867				12,744
Brokered and time deposits			5,394				6,528				10,411				13,220
Short-term borrowings			123				566				265				1,393
Long-term debt			5,538				5,479				11,116				10,962
Total interest expense			16,119				19,242				32,094				39,548
Net interest income			105,346				100,503				209,722				203,056
Provision for loan and covered loan losses			17,038				31,093				44,739				68,671
Net interest income after provision for loan and covered loan losses			88,308				69,410				164,983				134,385
Non-interest Income
Trust and Investments			4,312				4,720				8,531				9,382
Mortgage banking			2,915				704				5,578				2,106
Capital markets products			6,033				3,871				13,382				8,360
Treasury management			5,260				4,453				10,414				8,778
Loan and credit-related fees			6,372				5,290				12,899				11,188
Deposit service charges and fees and other income			1,644				1,884				3,131				4,368
Net securities (losses) gains			(290	)			670				(185	)			1,037
Total non-interest income			26,246				21,592				53,750				45,219
Non-interest Expense
Salaries and employee benefits			42,177				38,636				84,875				77,193
Net occupancy expense			7,653				7,545				15,332				15,077
Technology and related costs			3,273				2,729				6,569				5,390
Marketing			3,058				2,500				5,218				4,443
Professional services			2,247				2,312				4,204				4,646
Outsourced servicing costs			2,093				1,852				3,803				4,006
Net foreclosed property expenses			11,894				7,485				20,129				13,791
Postage, telephone, and delivery			882				931				1,751				1,819
Insurance			4,239				5,092				8,544				12,432
Loan and collection expense			2,918				4,247				6,075				6,800
Other expenses			3,424				2,335				7,587				5,416
Total non-interest expense			83,858				75,664				164,087				151,013
Income before income taxes			30,696				15,338				54,646				28,591
Income tax provision			13,192				6,320				22,887				8,599
Net income			17,504				9,018				31,759				19,992
Net income attributable to noncontrolling interests			—				58				—				130
Net income attributable to controlling interests			17,504				8,960				31,759				19,862
Preferred stock dividends and discount accretion			3,442				3,419				6,878				6,834
Net income available to common stockholders		$	14,062			$	5,541			$	24,881			$	13,028
Per Common Share Data
Basic earnings per share		$	0.19			$	0.08			$	0.35			$	0.18
Diluted earnings per share		$	0.19			$	0.08			$	0.34			$	0.18
Cash dividends declared		$	0.01			$	0.01			$	0.02			$	0.02
Weighted-average common shares outstanding			70,956				70,428				70,868				70,388
Weighted-average diluted common shares outstanding			71,147				70,663				71,041				70,602

 

Note 1:

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

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Quarterly Consolidated Income Statements Unaudited   (Amounts in thousands except per share data)

 

		2Q12				1Q12				4Q11				3Q11				2Q11
Interest Income
Loans, including fees		$	105,142			$	103,539			$	102,897			$	102,174			$	102,391
Federal funds sold and other short-term investments			133				132				215				231				399
Securities:
Taxable			14,854				15,380				15,263				15,196				15,568
Exempt from Federal income taxes			1,336				1,300				1,273				1,293				1,387
Total interest income			121,465				120,351				119,648				118,894				119,745
Interest Expense
Interest-bearing demand deposits			799				636				585				625				587
Savings deposits and money market accounts			4,265				4,602				4,857				5,356				6,082
Brokered and time deposits			5,394				5,017				5,561				5,895				6,528
Short-term borrowings			123				142				152				466				566
Long-term debt			5,538				5,578				5,511				5,463				5,479
Total interest expense			16,119				15,975				16,666				17,805				19,242
Net interest income			105,346				104,376				102,982				101,089				100,503
Provision for loan and covered loan losses			17,038				27,701				31,611				32,615				31,093
Net interest income after provision for loan and covered loan losses			88,308				76,675				71,371				68,474				69,410
Non-interest Income
Trust and Investments			4,312				4,219				3,992				4,452				4,720
Mortgage banking			2,915				2,663				3,032				1,565				704
Capital markets products			6,033				7,349				5,471				5,510				3,871
Treasury management			5,260				5,154				4,813				4,590				4,453
Loan and credit-related fees			6,372				6,527				5,606				5,413				5,290
Deposit service charges and fees and other income			1,644				1,487				2,115				1,735				1,884
Net securities (losses) gains			(290	)			105				364				4,370				670
Total non-interest income			26,246				27,504				25,393				27,635				21,592
Non-interest Expense
Salaries and employee benefits			42,177				42,698				40,729				38,841				38,636
Net occupancy expense			7,653				7,679				7,394				7,515				7,545
Technology and related costs			3,273				3,296				3,142				2,856				2,729
Marketing			3,058				2,160				2,250				2,218				2,500
Professional services			2,247				1,957				2,126				2,434				2,312
Outsourced servicing costs			2,093				1,710				2,077				1,918				1,852
Net foreclosed property expenses			11,894				8,235				6,862				7,129				7,485
Postage, telephone, and delivery			882				869				953				944				931
Insurance			4,239				4,305				3,462				5,393				5,092
Loan and collection expense			2,918				3,157				3,840				2,931				4,247
Other expenses			3,424				4,163				3,395				2,855				2,335
Total non-interest expense			83,858				80,229				76,230				75,034				75,664
Income before income taxes			30,696				23,950				20,534				21,075				15,338
Income tax provision			13,192				9,695				9,468				7,593				6,320
Net income			17,504				14,255				11,066				13,482				9,018
Net income attributable to noncontrolling interests			—				—				7				33				58
Net income attributable to controlling interests			17,504				14,255				11,059				13,449				8,960
Preferred stock dividends and discount accretion			3,442				3,436				3,430				3,426				3,419
Net income available to common stockholders		$	14,062			$	10,819			$	7,629			$	10,023			$	5,541
Per Common Share Data
Basic earnings per share		$	0.19			$	0.15			$	0.11			$	0.14			$	0.08
Diluted earnings per share		$	0.19			$	0.15			$	0.11			$	0.14			$	0.08
Cash dividends declared		$	0.01			$	0.01			$	0.01			$	0.01			$	0.01
Weighted-average common shares outstanding			70,956				70,780				70,540				70,479				70,428
Weighted-average diluted common shares outstanding			71,147				70,932				70,713				70,621				70,663

 

Note 1:

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

 

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Consolidated Balance Sheets   (Dollars in thousands)

 

		06/30/12				03/31/12				12/31/11				09/30/11				06/30/11
		unaudited				unaudited				audited				unaudited				unaudited
Assets
Cash and due from banks		$	141,563			$	166,062			$	156,131			$	171,268			$	160,289
Fed funds sold and other short-term investments			315,378				193,571				205,610				248,559				457,422
Loans held for sale			35,342				29,185				32,049				24,126				13,503
Securities available-for-sale, at fair value			1,625,649				1,705,649				1,783,465				1,872,587				2,057,290
Securities held-to-maturity, at amortized cost			693,277				598,066				490,143				273,200				—
Non-marketable equity investments			47,702				43,882				43,604				43,894				20,406
Loans - excluding covered assets, net of unearned fees			9,436,235				9,222,253				9,008,561				8,674,955				8,672,642
Allowance for loan losses			(174,302	)			(183,844	)			(191,594	)			(200,041	)			(206,286	)
Loans, net of allowance for loan losses and unearned fees			9,261,933				9,038,409				8,816,967				8,474,914				8,466,356
Covered assets			244,782				276,534				306,807				318,973				346,452
Allowance for covered loan losses			(21,733	)			(26,323	)			(25,939	)			(16,689	)			(16,904	)
Covered assets, net of allowance for covered loan losses			223,049				250,211				280,868				302,284				329,548
Other real estate owned, excluding covered assets			109,836				123,498				125,729				116,364				123,997
Premises, furniture, and equipment, net			38,177				37,462				38,633				39,069				38,171
Accrued interest receivable			37,089				36,033				35,732				32,686				32,128
Investment in bank owned life insurance			51,751				51,356				50,966				50,565				50,183
Goodwill			94,546				94,559				94,571				94,584				94,596
Other intangible assets			14,152				14,683				15,353				15,715				16,089
Capital markets derivative assets			102,613				97,805				101,676				111,248				93,453
Other assets			150,119				142,733				145,373				148,798				161,946
Total assets		$	12,942,176			$	12,623,164			$	12,416,870			$	12,019,861			$	12,115,377
Liabilities
Demand deposits:
Noninterest-bearing		$	2,920,182			$	3,054,536			$	3,244,307			$	2,832,481			$	2,527,230
Interest-bearing			785,879				714,522				595,238				611,293				531,107
Savings deposits and money market accounts			4,146,022				4,347,832				4,378,220				4,392,697				4,497,297
Brokered deposits			1,484,435				961,481				815,951				902,002				1,342,422
Time deposits			1,398,012				1,344,341				1,359,138				1,370,190				1,336,212
Total deposits			10,734,530				10,422,712				10,392,854				10,108,663				10,234,268
Short-term borrowings			335,000				355,000				156,000				59,154				63,311
Long-term debt			374,793				379,793				379,793				379,793				409,793
Accrued interest payable			5,855				5,425				5,567				5,841				5,767
Capital markets derivative liabilities			105,773				100,109				104,140				113,968				95,043
Other liabilities			52,071				47,971				81,764				66,266				46,547
Total liabilities			11,608,022				11,311,010				11,120,118				10,733,685				10,854,729
Equity
Preferred stock - Series B			241,185				240,791				240,403				240,020				239,642
Common stock			71,843				71,611				71,483				71,220				71,155
Treasury stock			(22,639	)			(21,749	)			(21,454	)			(20,680	)			(20,615	)
Additional paid-in capital			978,510				973,417				968,787				965,640				963,156
Retained earnings/(accumulated deficit)			14,268				932				(9,164	)			(16,075	)			(25,388	)
Accumulated other comprehensive income, net of tax			50,987				47,152				46,697				46,051				32,535
Total stockholders’ equity			1,334,154				1,312,154				1,296,752				1,286,176				1,260,485
Noncontrolling interests			—				—				—				—				163
Total equity			1,334,154				1,312,154				1,296,752				1,286,176				1,260,648
Total liabilities and equity		$	12,942,176			$	12,623,164			$	12,416,870			$	12,019,861			$	12,115,377

---

Selected Financial Data

Unaudited   (Amounts in thousands except per share data)

 

		2Q12				1Q12				4Q11				3Q11				2Q11
Selected Statement of Income Data:
Net interest income		$	105,346			$	104,376			$	102,982			$	101,089			$	100,503
Net revenue (1) (2)		$	132,291			$	132,560			$	129,046			$	129,404			$	122,811
Operating profit (1) (2)		$	48,433			$	52,331			$	52,816			$	54,370			$	47,147
Provision for loan and covered loan losses		$	17,038			$	27,701			$	31,611			$	32,615			$	31,093
Income before taxes		$	30,696			$	23,950			$	20,534			$	21,075			$	15,338
Net income available to common stockholders		$	14,062			$	10,819			$	7,629			$	10,023			$	5,541
Per Common Share Data:
Basic earnings per share		$	0.19			$	0.15			$	0.11			$	0.14			$	0.08
Diluted earnings per share		$	0.19			$	0.15			$	0.11			$	0.14			$	0.08
Dividends declared		$	0.01			$	0.01			$	0.01			$	0.01			$	0.01
Book value (period end) (1)		$	15.09			$	14.79			$	14.72			$	14.57			$	14.22
Tangible book value (period end) (1) (2)		$	13.59			$	13.29			$	13.19			$	13.04			$	12.68
Market value (close)		$	14.76			$	15.17			$	10.98			$	7.52			$	13.80
Book value multiple			0.98	x			1.03	x			0.75	x			0.52	x			0.97	x
Share Data:
Weighted-average common shares outstanding			70,956				70,780				70,540				70,479				70,428
Diluted-average common shares outstanding			71,147				70,932				70,713				70,621				70,663
Common shares issued (at period end)			73,273				73,205				72,514				72,491				72,497
Common shares outstanding (at period end)			72,424				72,415				71,745				71,789				71,808
Performance Ratios:
Return on average assets			0.55	%			0.46	%			0.36	%			0.44	%			0.29	%
Return on average common equity			5.18	%			4.04	%			2.86	%			3.80	%			2.18	%
Net interest margin (1) (2)			3.46	%			3.53	%			3.48	%			3.49	%			3.36	%
Fee revenue as a percent of total revenue (1)			20.12	%			20.79	%			19.55	%			18.71	%			17.23	%
Non-interest income to average assets			0.83	%			0.89	%			0.82	%			0.91	%			0.69	%
Non-interest expense to average assets			2.64	%			2.59	%			2.45	%			2.46	%			2.43	%
Net overhead ratio (1)			1.81	%			1.70	%			1.64	%			1.56	%			1.74	%
Efficiency ratio (1) (2)			63.39	%			60.52	%			59.07	%			57.98	%			61.61	%
Selected Information:
Assets under management and administration (AUMA) (1)		$	4,738,973			$	4,879,947			$	4,303,547			$	4,161,614			$	4,395,516
Custody assets included in AUMA		$	2,073,777			$	2,060,455			$	1,599,528			$	1,525,001			$	1,623,190
Credit valuation adjustment on capital markets derivatives (1)		$	(830	)		$	19			$	244			$	(1,207	)		$	(573	)
Balance Sheet Ratios:
Loans to deposits (period end) (3)			87.91	%			88.48	%			86.68	%			85.82	%			84.74	%
Average interest-earning assets to average interest-bearing liabilities			146.44	%			149.68	%			150.70	%			145.30	%			139.77	%
Capital Ratios (period end):
Total risk-based capital (1)			14.12	%			14.20	%			14.28	%			14.82	%			15.12	%
Tier 1 risk-based capital (1)			12.25	%			12.31	%			12.38	%			12.89	%			12.95	%
Leverage (1)			11.20	%			11.35	%			11.33	%			11.48	%			11.00	%
Tier 1 common capital (1) (2)			8.05	%			8.04	%			8.04	%			8.34	%			8.34	%
Tangible common equity to tangible assets (1) (2)			7.67	%			7.69	%			7.69	%			7.86	%			7.58	%
Total equity to total assets			10.31	%			10.39	%			10.44	%			10.70	%			10.41	%

 

(1)	Refer to Glossary of Terms for definition.

(2)	This is a non-U.S. GAAP financial measure, refer to Non-U.S. GAAP Financial Measures for a reconciliation from non-U.S. GAAP to U.S. GAAP.

(3)	Excludes covered assets. Refer to Glossary of Terms for definition.

---

Loan Composition (excluding covered assets(1)) (Dollars in thousands)

 

						% of								% of								% of								% of								% of
		06/30/12				Total				03/31/12				Total				12/31/11				Total				09/30/11				Total				06/30/11				Total
		unaudited								unaudited								audited								unaudited								unaudited
Commercial and industrial		$	4,523,780				48	%		$	4,325,558				47	%		$	4,192,842				46	%		$	3,959,153				45	%		$	3,886,555				46	%
Commercial - owner-occupied CRE			1,384,831				15	%			1,175,729				13	%			1,130,932				13	%			1,070,340				12	%			986,602				11	%
Total commercial			5,908,611				63	%			5,501,287				60	%			5,323,774				59	%			5,029,493				57	%			4,873,157				57	%
Commercial real estate			2,124,492				23	%			2,378,640				26	%			2,233,851				25	%			2,156,621				25	%			2,280,961				26	%
Commercial real estate - multi-family			499,250				5	%			493,218				5	%			452,595				5	%			445,908				5	%			416,459				5	%
Total commercial real estate			2,623,742				28	%			2,871,858				31	%			2,686,446				30	%			2,602,529				30	%			2,697,420				31	%
Construction			171,014				2	%			127,837				1	%			287,002				3	%			315,858				4	%			366,061				4	%
Residential real estate			330,254				3	%			308,880				3	%			297,229				3	%			307,705				4	%			301,250				3	%
Home equity			174,131				2	%			175,972				2	%			181,158				2	%			186,914				2	%			190,691				2	%
Personal			228,483				2	%			236,419				3	%			232,952				3	%			232,456				3	%			244,063				3	%
Total loans		$	9,436,235				100	%		$	9,222,253				100	%		$	9,008,561				100	%		$	8,674,955				100	%		$	8,672,642				100	%

 

 

(1)	Refer to Glossary of Terms for definition.

---

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)

 

		06/30/12								03/31/12								12/31/11
						% of								% of								% of
		Amount				Total				Amount				Total				Amount				Total
Manufacturing		$	1,347,763				23	%		$	1,301,681				24	%		$	1,257,973				24	%
Healthcare			1,290,219				22	%			1,343,017				24	%			1,218,205				23	%
Wholesale trade			588,666				10	%			506,840				9	%			482,386				9	%
Finance and insurance			492,367				8	%			493,103				9	%			454,830				8	%
Real estate, rental and leasing			333,393				6	%			269,647				5	%			342,860				6	%
Professional, scientific and technical services			410,156				7	%			348,907				6	%			350,677				7	%
Administrative, support, waste management and remediation services			351,447				6	%			328,370				6	%			321,912				6	%
Architectural, engineering and construction			257,529				4	%			209,998				4	%			195,875				4	%
All other (2)			837,071				14	%			699,724				13	%			699,056				13	%
Total commercial (3)		$	5,908,611				100	%		$	5,501,287				100	%		$	5,323,774				100	%

Commercial Real Estate and Construction Loans Portfolio by Collateral Type

 

		06/30/12																03/31/12																12/31/11
										Amount																Amount
						% of				Non-				% Non-								% of				Non-				% Non-								% of
		Amount				Total				performing				performing  (4)				Amount				Total				performing				performing  (4)				Amount				Total
Commercial Real Estate Portfolio
Land		$	225,810				9	%		$	24,792				11	%		$	238,326				8	%		$	30,016				13	%		$	230,579				9	%
Residential 1-4 family			90,554				3	%			12,139				13	%			119,772				4	%			16,709				14	%			105,919				4	%
Multi-family			499,250				19	%			8,752				2	%			493,218				17	%			5,983				1	%			452,595				17	%
Industrial/warehouse			310,203				12	%			6,886				2	%			370,200				13	%			7,596				2	%			350,282				13	%
Office			568,435				22	%			20,560				4	%			617,871				22	%			20,157				3	%			585,183				22	%
Retail			401,888				15	%			37,730				9	%			489,960				17	%			60,006				12	%			431,200				16	%
Healthcare			209,934				8	%			—				—				144,239				5	%			—				—				144,529				5	%
Mixed use/other			317,668				12	%			8,585				3	%			398,272				14	%			18,788				5	%			386,159				14	%
Total commercial real estate		$	2,623,742				100	%		$	119,444				5	%		$	2,871,858				100	%		$	159,255				6	%		$	2,686,446				100	%
Construction Portfolio
Land		$	53,050				31	%		$	—				—			$	39,735				31	%		$	369				1	%		$	23,422				8	%
Residential 1-4 family			14,785				9	%			—				—				19,033				15	%			1,223				6	%			21,906				8	%
Multi-family			11,950				7	%			—				—				10,793				8	%			—				—				64,892				23	%
Industrial/warehouse			4,870				3	%			—				—				2,861				2	%			—				—				15,216				5	%
Office			39,303				23	%			401				1	%			27,757				22	%			336				1	%			43,403				15	%
Retail			11,736				7	%			—				—				4,687				4	%			—				—				61,469				21	%
Mixed use/other			35,320				20	%			154					*			22,971				18	%			852				4	%			56,694				20	%
Total construction		$	171,014				100	%		$	555					*		$	127,837				100	%		$	2,780				2	%		$	287,002				100	%

 

 

(1)	Refer to Glossary of Terms for definition.

(2)	All other consists of numerous smaller balances across a variety of industries.

(3)	Includes owner-occupied commercial real estate of $1.4 billion, $1.2 billion and $1.1 billion at June 30, 2012, March 31, 2012 and December 31, 2011, respectively.

(4)	Calculated as nonperforming loans in the respective collateral type divided by total loans of the corresponding collateral type presented above.

*	Less than 1%.

---

Asset Quality (excluding covered assets⁽¹⁾)

Unaudited
(Dollars in thousands)

 

		2Q12				1Q12				4Q11				3Q11				2Q11
Credit Quality Key Ratios
Net charge-offs (annualized) to average loans			1.16	%			1.57	%			1.72	%			1.76	%			1.95	%
Nonperforming loans to total loans			2.22	%			2.53	%			2.88	%			3.51	%			3.81	%
Nonperforming loans to total assets			1.62	%			1.85	%			2.09	%			2.54	%			2.73	%
Nonperforming assets to total assets			2.47	%			2.83	%			3.11	%			3.50	%			3.75	%
Allowance for loan losses to:
Total loans			1.85	%			1.99	%			2.13	%			2.31	%			2.38	%
Nonperforming loans			83	%			79	%			74	%			66	%			62	%
Nonperforming assets
Loans past due 90 days and accruing		$	—			$	—			$	—			$	—			$	—
Nonaccrual loans			209,339				233,222				259,852				304,747				330,448
OREO			109,836				123,498				125,729				116,364				123,997
Total nonperforming assets		$	319,175			$	356,720			$	385,581			$	421,111			$	454,445
Restructured loans accruing interest		$	97,690			$	136,521			$	100,909			$	106,330			$	124,614
Special mention loans		$	108,052			$	143,790			$	204,965			$	218,561			$	227,413
Potential problem loans		$	164,077			$	184,029			$	177,095			$	277,125			$	392,019
Nonperforming Loans Rollforward
Beginning balance		$	233,222			$	259,852			$	304,747			$	330,448			$	356,932
Additions:
New nonaccrual loans			57,717				69,581				67,512				68,298				110,438
Reductions:
Return to performing status			(1,953	)			(14,291	)			(2,072	)			(1,608	)			(2,781	)
Paydowns and payoffs, net of advances			(9,961	)			(4,806	)			(8,950	)			(13,166	)			(8,258	)
Net sales			(25,954	)			(27,479	)			(27,178	)			(20,432	)			(38,129	)
Transfer to OREO			(9,968	)			(13,513	)			(33,695	)			(24,373	)			(49,667	)
Charge-offs, net			(33,764	)			(36,122	)			(40,512	)			(34,420	)			(38,087	)
Total reductions			(81,600	)			(96,211	)			(112,407	)			(93,999	)			(136,922	)
Balance at end of period		$	209,339			$	233,222			$	259,852			$	304,747			$	330,448
OREO Rollforward
Beginning balance		$	123,498			$	125,729			$	116,364			$	123,997			$	93,770
New foreclosed properties			9,968				13,513				33,695				24,373				49,667
Valuation adjustments			(9,207	)			(4,522	)			(3,999	)			(1,175	)			(5,483	)
Disposals:
Sales proceeds			(13,517	)			(9,078	)			(18,085	)			(25,921	)			(13,615	)
Net loss on sale			(906	)			(2,144	)			(2,246	)			(4,910	)			(342	)
Balance at end of period		$	109,836			$	123,498			$	125,729			$	116,364			$	123,997
Restructured Loans Accruing Interest Rollforward
Beginning balance		$	136,521			$	100,909			$	106,330			$	124,614			$	100,895
Additions:
New restructured loans accruing interest			1,864				47,673				8,803				8,592				54,663
Return to performing status			157				—				1,099				1,029				—
Reductions:
Paydowns and payoffs, net of advances			(14,593	)			(4,661	)			(3,334	)			(20,545	)			(7,915	)
Move to nonperforming loans			(25,688	)			(6,665	)			(5,735	)			(4,716	)			(9,930	)
Net sales			(170	)			—				—				(2,260	)			(9,600	)
Removal of restructured loan status			(401	)			(735	)			(6,254	)			(340	)			—
Charge-offs, net			—				—				—				(44	)			(3,499	)
Balance at end of period		$	97,690			$	136,521			$	100,909			$	106,330			$	124,614

 

(1)	Refer to Glossary of Terms for definition.

---

Asset Quality (excluding covered assets(1)) Unaudited (Dollars in thousands)

Credit Quality Indicators ⁽¹⁾

 

		Special								Potential								Non-
		Mention				% of				Problem				% of				Performing				% of				Total
		Loans				Loan Type				Loans				Loan Type				Loans				Loan Type				Loans
As of June 30, 2012
Transformational (1)
Commercial		$	50,348				0.9	%		$	54,982				1.0	%		$	45,464				0.8	%		$	5,413,098
Commercial real estate			16,724				1.0	%			21,921				1.3	%			68,843				4.0	%			1,721,408
Construction			5,844				3.5	%			—				—				—				—				164,639
Residential real estate			351				0.2	%			4,653				3.1	%			1,250				0.8	%			149,150
Home equity			—				—				1,656				2.6	%			423				0.7	%			64,266
Personal			—				—				51					*			1,010				0.6	%			158,378
Total transformational		$	73,267				1.0	%		$	83,263				1.1	%		$	116,990				1.5	%		$	7,670,939
Legacy (1)
Commercial		$	5,630				1.1	%		$	7,940				1.6	%		$	14,377				2.9	%		$	495,513
Commercial real estate			26,254				2.9	%			52,943				5.9	%			50,601				5.6	%			902,334
Construction			—				—				—				—				555				8.7	%			6,375
Residential real estate			2,378				1.3	%			14,959				8.3	%			9,778				5.4	%			181,104
Home equity			516				0.5	%			4,200				3.8	%			11,640				10.6	%			109,865
Personal			7					*			772				1.1	%			5,398				7.7	%			70,105
Total legacy			34,785				2.0	%			80,814				4.6	%			92,349				5.2	%			1,765,296
Total		$	108,052				1.1	%		$	164,077				1.7	%		$	209,339				2.2	%		$	9,436,235
As of March 31, 2012
Transformational (1)
Commercial		$	61,382				1.2	%		$	49,229				1.0	%		$	22,765				0.4	%		$	5,065,103
Commercial real estate			26,466				1.5	%			33,251				1.9	%			87,228				4.9	%			1,782,434
Construction			7,272				6.1	%			—				—				—				—				118,394
Residential real estate			4,309				2.9	%			5,983				4.0	%			1,057				0.7	%			149,639
Home equity			—				—				1,659				2.8	%			424				0.7	%			59,946
Personal			—				—				765				0.5	%			311				0.2	%			149,951
Total transformational		$	99,429				1.4	%		$	90,887				1.2	%		$	111,785				1.5	%		$	7,325,467
Legacy (1)
Commercial		$	11,198				2.6	%		$	8,557				2.0	%		$	17,421				4.0	%		$	436,184
Commercial real estate			30,355				2.8	%			62,880				5.8	%			72,027				6.6	%			1,089,424
Construction			—				—				—				—				2,781				29.5	%			9,443
Residential real estate			2,384				1.5	%			15,027				9.4	%			11,012				6.9	%			159,241
Home equity			420				0.4	%			5,613				4.8	%			9,954				8.6	%			116,026
Personal			4					*			1,065				1.2	%			8,242				9.5	%			86,468
Total legacy			44,361				2.3	%			93,142				4.9	%			121,437				6.4	%			1,896,786
Total		$	143,790				1.6	%		$	184,029				2.0	%		$	233,222				2.5	%		$	9,222,253

 

 

(1)	Refer to Glossary of Terms for definition.

*	Less than 0.1%.

---

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 June 30, 2012
Loan balances:
Commercial		$	5,842,805			$	901			$	5,064			$	—			$	59,841			$	5,908,611
Commercial real estate			2,500,441				1,314				2,543				—				119,444				2,623,742
Construction			170,459				—				—				—				555				171,014
Residential real estate			318,864				341				21				—				11,028				330,254
Personal and home equity			381,143				1,983				1,017				—				18,471				402,614
Total loans		$	9,213,712			$	4,539			$	8,645			$	—			$	209,339			$	9,436,235
Aging as a percent of loan balance:
Commercial			98.89	%			0.01	%			0.09	%			—				1.01	%			100.00	%
Commercial real estate			95.30	%			0.05	%			0.10	%			—				4.55	%			100.00	%
Construction			99.68	%			—				—				—				0.32	%			100.00	%
Residential real estate			96.55	%			0.10	%			0.01	%			—				3.34	%			100.00	%
Personal and home equity			94.67	%			0.49	%			0.25	%			—				4.59	%			100.00	%
Total loans			97.64	%			0.05	%			0.09	%			—				2.22	%			100.00	%

 

		2Q12				1Q12				4Q11				3Q11				2Q11
Nonaccrual loans:
Commercial		$	59,841			$	40,186			$	65,958			$	61,399			$	51,634
Commercial real estate			119,444				159,255				133,257				168,078				192,778
Construction			555				2,781				21,879				29,997				37,140
Residential real estate			11,028				12,069				14,589				18,007				18,496
Personal and home equity			18,471				18,931				24,169				27,266				30,400
Total		$	209,339			$	233,222			$	259,852			$	304,747			$	330,448
Nonaccrual loans as a percent of total loan type:
Commercial			1.01	%			0.73	%			1.24	%			1.22	%			1.06	%
Commercial real estate			4.55	%			5.55	%			4.96	%			6.46	%			7.15	%
Construction			0.32	%			2.18	%			7.62	%			9.50	%			10.15	%
Residential real estate			3.34	%			3.91	%			4.91	%			5.85	%			6.14	%
Personal and home equity			4.59	%			4.59	%			5.84	%			6.50	%			6.99	%
Total			2.22	%			2.53	%			2.88	%			3.51	%			3.81	%
Loans past due 60-89 days and still accruing:
Commercial		$	5,064			$	3,963			$	923			$	101			$	3,978
Commercial real estate			2,543				2,081				9,777				8,801				10,292
Construction			—				68				2,381				—				—
Residential real estate			21				1,135				645				2,864				1,000
Personal and home equity			1,017				253				809				1,016				1,288
Total		$	8,645			$	7,500			$	14,535			$	12,782			$	16,558
Loans past due 60-89 days and still accruing as a percent of total loan type:
Commercial			0.09	%			0.07	%			0.02	%				*			0.08	%
Commercial real estate			0.10	%			0.07	%			0.36	%			0.34	%			0.39	%
Construction			—				0.05	%			0.83	%			—				—
Residential real estate			0.01	%			0.37	%			0.22	%			0.93	%			0.33	%
Personal and home equity			0.25	%			0.06	%			0.20	%			0.24	%			0.30	%
Total			0.09	%			0.08	%			0.16	%			0.15	%			0.19	%
Loans past due 30-59 days and still accruing:
Commercial		$	901			$	3,216			$	6,018			$	3,529			$	1,723
Commercial real estate			1,314				6,590				3,523				5,884				3,384
Construction			—				—				—				342				—
Residential real estate			341				4,960				3,800				7				392
Personal and home equity			1,983				1,754				446				776				2,803
Total		$	4,539			$	16,520			$	13,787			$	10,538			$	8,302
Loans past due 30-59 days and still accruing as a percent of total loan type:
Commercial			0.01	%			0.06	%			0.11	%			0.07	%			0.03	%
Commercial real estate			0.05	%			0.23	%			0.13	%			0.23	%			0.13	%
Construction			—				—				—				0.11	%			—
Residential real estate			0.10	%			1.61	%			1.28	%				*			0.13	%
Personal and home equity			0.49	%			0.43	%			0.11	%			0.19	%			0.64	%
Total			0.05	%			0.18	%			0.15	%			0.12	%			0.10	%

 

(1)	Refer to Glossary of Terms for definition.

*	Less than 0.01%.

---

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 June 30, 2012
Amount:
Commercial		$	31,535			$	—			$	11,407			$	8,792			$	8,107			$	59,841
Commercial real estate			63,709				6,409				6,984				12,220				30,122				119,444
Construction			—				—				—				—				555				555
Residential real estate			—				—				4,789				—				6,239				11,028
Personal and home equity			—				—				3,848				—				14,623				18,471
Total		$	95,244			$	6,409			$	27,028			$	21,012			$	59,646			$	209,339
Number of borrowers:
Commercial			2				—				3				4				30				39
Commercial real estate			4				1				2				5				48				60
Construction			—				—				—				—				2				2
Residential real estate			—				—				1				—				21				22
Personal and home equity			—				—				1				—				43				44
Total			6				1				7				9				144				167
As of March 31, 2012
Amount:
Commercial		$	—			$	14,164			$	7,737			$	5,751			$	12,534			$	40,186
Commercial real estate			77,770				19,374				11,493				25,689				24,929				159,255
Construction			—				—				—				—				2,781				2,781
Residential real estate			—				—				4,789				—				7,280				12,069
Personal and home equity			—				5,827				—				1,615				11,489				18,931
Total		$	77,770			$	39,365			$	24,019			$	33,055			$	59,013			$	233,222
Number of borrowers:
Commercial			—				2				2				3				35				42
Commercial real estate			5				3				3				12				48				71
Construction			—				—				—				—				6				6
Residential real estate			—				—				1				—				20				21
Personal and home equity			—				1				—				1				31				33
Total			5				6				6				16				140				173

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 June 30, 2012
Amount:
Commercial		$	60,733			$	14,190			$	—			$	2,799			$	4,496			$	82,218
Commercial real estate			—				5,157				—				4,211				3,609				12,977
Construction			—				—				—				—				—				—
Residential real estate			—				—				—				—				874				874
Personal and home equity			—				—				—				—				1,621				1,621
Total		$	60,733			$	19,347			$	—			$	7,010			$	10,600			$	97,690
Number of borrowers:
Commercial			4				2				—				1				10				17
Commercial real estate			—				1				—				2				8				11
Construction			—				—				—				—				—				—
Residential real estate			—				—				—				—				3				3
Personal and home equity			—				—				—				—				2				2
Total			4				3				—				3				23				33
As of March 31, 2012
Amount:
Commercial		$	55,205			$	20,050			$	3,259			$	—			$	4,155			$	82,669
Commercial real estate			20,576				5,178				—				7,217				4,586				37,557
Construction			—				—				—				—				—				—
Residential real estate			—				—				—				—				1,115				1,115
Personal and home equity			12,593				—				—				—				2,587				15,180
Total		$	88,374			$	25,228			$	3,259			$	7,217			$	12,443			$	136,521
Number of borrowers:
Commercial			4				3				1				—				10				18
Commercial real estate			1				1				—				3				9				14
Construction			—				—				—				—				—				—
Residential real estate			—				—				—				—				4				4
Personal and home equity			1				—				—				—				4				5
Total			6				4				1				3				27				41

 

(1)	Refer to Glossary of Terms for definition.

---

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

Unaudited (Dollars in thousands)

OREO Properties by Type

 

		June 30, 2012												March 31, 2012												December 31, 2011
		Number of								% of				Number of								% of				Number of								% of
		Properties				Amount				Total				Properties				Amount				Total				Properties				Amount				Total
Single-family homes			58			$	17,734				16	%			69			$	21,074				17	%			71			$	26,866				21	%
Land parcels			273				43,367				39	%			260				49,706				40	%			262				51,465				41	%
Multi-family			8				2,026				2	%			13				4,665				4	%			14				3,327				3	%
Office/industrial			45				34,912				32	%			47				39,983				32	%			44				37,019				29	%
Retail			23				11,797				11	%			11				8,070				7	%			9				7,052				6	%
Total			407			$	109,836				100	%			400			$	123,498				100	%			400			$	125,729				100	%

OREO Property Type by Location

 

														South				Mid
		Illinois				Georgia				Michigan				Eastern (2)				Western (3)				Other				Total
June 30, 2012
Single-family homes		$	16,431			$	—			$	—			$	—			$	1,062			$	241			$	17,734
Land parcels			24,104				2,996				1,956				8,133				6,178				—				43,367
Multi-family			1,918				—				—				—				108				—				2,026
Office/industrial			18,720				1,058				1,181				3,762				8,140				2,051				34,912
Retail			8,946				2,851				—				—				—				—				11,797
Total		$	70,119			$	6,905			$	3,137			$	11,895			$	15,488			$	2,292			$	109,836
% of Total			64	%			6	%			3	%			11	%			14	%			2	%			100	%
March 31, 2012
Single-family homes		$	18,497			$	—			$	1,718			$	—			$	618			$	241			$	21,074
Land parcels			27,487				3,438				2,137				9,568				7,076				—				49,706
Multi-family			1,335				—				—				460				2,870				—				4,665
Office/industrial			19,670				1,058				1,197				6,411				8,253				3,394				39,983
Retail			4,872				2,262				936				—				—				—				8,070
Total		$	71,861			$	6,758			$	5,988			$	16,439			$	18,817			$	3,635			$	123,498
% of Total			58	%			6	%			5	%			13	%			15	%			3	%			100	%
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	%

 

(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)

 

		2Q12				1Q12				4Q11				3Q11				2Q11
Change in allowance for loan losses:
Balance at beginning of period		$	183,844			$	191,594			$	200,041			$	206,286			$	218,237
Loans charged-off:
Commercial		$	(7,769	)		$	(9,549	)		$	(12,991	)		$	(5,039	)		$	(10,512	)
Commercial real estate			(17,924	)			(25,280	)			(24,083	)			(29,920	)			(25,402	)
Construction			(828	)			(1,245	)			(1,526	)			(1,419	)			(8,275	)
Residential real estate			(1,006	)			(1,084	)			(1,203	)			(234	)			(186	)
Home equity			(4	)			(483	)			(1,340	)			(3,291	)			(508	)
Personal			(6,341	)			(2,085	)			(290	)			(2,083	)			(434	)
Total charge-offs			(33,872	)			(39,726	)			(41,433	)			(41,986	)			(45,317	)
Recoveries on loans previously charged-off:
Commercial		$	634			$	1,679			$	830			$	2,278			$	707
Commercial real estate			4,150				1,882				1,410				969				511
Construction			1,664				41				109				29				56
Residential real estate			2				11				10				9				40
Home equity			314				26				300				12				15
Personal			163				702				544				103				312
Total recoveries			6,927				4,341				3,203				3,400				1,641
Net charge-offs			(26,945	)			(35,385	)			(38,230	)			(38,586	)			(43,676	)
Provisions charged to operating expense			17,403				27,635				29,783				32,341				31,725
Balance at end of period		$	174,302			$	183,844			$	191,594			$	200,041			$	206,286
Allocation of allowance for loan losses:
General allocated reserve:
Commercial		$	47,210			$	45,850			$	46,500			$	45,000			$	46,000
Commercial real estate			53,700				57,750				56,000				60,000				67,000
Construction			2,635				1,900				7,650				10,450				9,600
Residential real estate			5,200				5,400				5,400				5,800				5,400
Home equity			4,200				4,700				2,750				3,500				3,500
Personal			3,260				3,295				3,350				3,100				3,100
Total allocated		$	116,205			$	118,895			$	121,650			$	127,850			$	134,600
Specific reserve			58,097				64,949				69,944				72,191				71,686
Total		$	174,302			$	183,844			$	191,594			$	200,041			$	206,286
Allocation of reserve by a percent of total allowance for loan losses:
General allocated reserve:
Commercial			27	%			25	%			24	%			22	%			22	%
Commercial real estate			31	%			31	%			29	%			30	%			32	%
Construction			2	%			1	%			4	%			5	%			5	%
Residential real estate			3	%			3	%			3	%			3	%			3	%
Home equity			2	%			3	%			1	%			2	%			2	%
Personal			2	%			2	%			2	%			2	%			2	%
Total allocated			67	%			65	%			63	%			64	%			66	%
Specific reserve			33	%			35	%			37	%			36	%			34	%
Total			100	%			100	%			100	%			100	%			100	%
Allowance for loan losses to:
Total loans			1.85	%			1.99	%			2.13	%			2.31	%			2.38	%
Nonperforming loans			83	%			79	%			74	%			66	%			62	%

 

(1)	Refer to Glossary of Terms for definition.

 

---

Deposits (Dollars in thousands)

 

						% of								% of								% of								% of								% of
		06/30/12				Total				03/31/12				Total				12/31/11				Total				09/30/11				Total				06/30/11				Total
		unaudited								unaudited								audited								unaudited								unaudited
Noninterest-bearing deposits		$	2,920,182				27	%		$	3,054,536				29	%		$	3,244,307				31	%		$	2,832,481				28	%		$	2,527,230				25	%
Interest-bearing demand deposits			785,879				7	%			714,522				7	%			595,238				6	%			611,293				6	%			531,107				5	%
Savings deposits			221,816				2	%			225,300				2	%			210,138				2	%			214,610				2	%			202,427				2	%
Money market accounts			3,924,206				37	%			4,122,532				40	%			4,168,082				40	%			4,178,087				41	%			4,294,870				42	%
Brokered deposits:
Traditional			667,454				6	%			191,023				2	%			20,499					*			60,665				1	%			277,628				3	%
Client CDARS (1)			762,231				7	%			695,458				6	%			795,452				8	%			841,337				8	%			956,094				9	%
Non-client CDARS (1)			54,750				1	%			75,000				1	%			—				—				—				—				108,700				1	%
Total brokered deposits			1,484,435				14	%			961,481				9	%			815,951				8	%			902,002				9	%			1,342,422				13	%
Time deposits			1,398,012				13	%			1,344,341				13	%			1,359,138				13	%			1,370,190				14	%			1,336,212				13	%
Total deposits		$	10,734,530				100	%		$	10,422,712				100	%		$	10,392,854				100	%		$	10,108,663				100	%		$	10,234,268				100	%
Client deposits (1)		$	10,012,326				93	%		$	10,156,689				97	%		$	10,372,355				100	%		$	10,047,998				99	%		$	9,847,940				96	%

 

*	Less than 1%.

 

 

(1)	Refer to Glossary of Terms for definition.

---

Net Interest Margin Unaudited   (Dollars in thousands)

 

		Three Months Ended June 30,
		2012												2011
		Average Balance				Interest (1)				Yield/ Rate				Average Balance				Interest (1)				Yield/ Rate
Assets:
Federal funds sold and other short-term investments		$	210,756			$	133				0.25	%		$	631,725			$	399				0.25	%
Securities:
Taxable			2,126,446				14,854				2.79	%			1,826,537				15,568				3.41	%
Tax-exempt (2)			171,426				2,035				4.75	%			139,620				2,103				6.02	%
Total securities			2,297,872				16,889				2.94	%			1,966,157				17,671				3.59	%
Loans, excluding covered assets:
Commercial			5,704,843				65,535				4.54	%			5,098,199				58,667				4.55	%
Commercial real estate			2,778,787				28,586				4.07	%			2,719,370				28,348				4.12	%
Construction			152,891				1,536				3.97	%			413,049				3,640				3.49	%
Residential			347,922				3,630				4.17	%			314,362				3,424				4.36	%
Personal and home equity			417,427				3,666				3.53	%			441,100				4,023				3.66	%
Total loans, excluding covered assets (3)			9,401,870				102,953				4.34	%			8,986,080				98,102				4.32	%
Total interest-earning assets before covered assets (2)			11,910,498				119,975				3.99	%			11,583,962				116,172				3.98	%
Covered assets (4)			237,781				2,189				3.66	%			332,076				4,289				5.12	%
Total interest-earning assets (2)			12,148,279			$	122,164				3.99	%			11,916,038			$	120,461				4.01	%
Cash and due from banks			148,174												156,678
Allowance for loan and covered loan losses			(218,798	)											(245,608	)
Other assets			702,533												672,575
Total assets		$	12,780,188											$	12,499,683
Liabilities and Equity:
Interest-bearing demand deposits		$	795,833			$	799				0.40	%		$	553,328			$	587				0.42	%
Savings deposits			225,335				161				0.29	%			204,794				209				0.41	%
Money market accounts			3,920,627				4,104				0.42	%			4,560,816				5,873				0.52	%
Time deposits			1,341,312				3,862				1.16	%			1,333,194				4,289				1.29	%
Brokered deposits			1,382,207				1,532				0.45	%			1,393,661				2,239				0.64	%
Total interest-bearing deposits			7,665,314				10,458				0.55	%			8,045,793				13,197				0.66	%
Short-term borrowings			250,774				123				0.19	%			70,045				566				3.20	%
Long-term debt			379,463				5,538				5.82	%			409,793				5,479				5.33	%
Total interest-bearing liabilities			8,295,551				16,119				0.78	%			8,525,631				19,242				0.90	%
Noninterest-bearing demand deposits			2,995,802												2,556,527
Other liabilities			156,656												158,773
Equity			1,332,179												1,258,752
Total liabilities and equity		$	12,780,188											$	12,499,683
Net interest spread (2) (5)											3.21	%											3.11	%
Effect of noninterest-bearing funds											0.25	%											0.25	%
Net interest income/margin (2) (5)						$	106,045				3.46	%						$	101,219				3.36	%

 

(1)	Interest income included $6.3 million and $5.5 million in loan fees for the three months ended June 30, 2012 and 2011, 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 financial measure. Refer to Non-U.S. GAAP Financial 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 $222.1 million and $357.2 million for the three months ended June 30, 2012 and 2011, respectively, and are included in loans for purposes of this analysis. Interest foregone on impaired loans was estimated to be approximately $2.3 million and $3.7 million for the three months ended June 30, 2012 and 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.

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Net Interest Margin Unaudited   (Dollars in thousands)

 

		Three Months Ended June 30,												Three Months Ended March 31,
		2012												2012
		Average Balance				Interest (1)				Yield/ Rate				Average Balance				Interest (1)				Yield/ Rate
Assets:
Federal funds sold and other short-term investments		$	210,756			$	133				0.25	%		$	211,343			$	132				0.25	%
Securities:
Taxable			2,126,446				14,854				2.79	%			2,097,422				15,380				2.93	%
Tax-exempt (2)			171,426				2,035				4.75	%			152,412				1,980				5.20	%
Total securities			2,297,872				16,889				2.94	%			2,249,834				17,360				3.09	%
Loans, excluding covered assets:
Commercial			5,704,843				65,535				4.54	%			5,443,925				63,910				4.64	%
Commercial real estate			2,778,787				28,586				4.07	%			2,598,139				27,715				4.22	%
Construction			152,891				1,536				3.97	%			279,343				2,611				3.70	%
Residential			347,922				3,630				4.17	%			338,144				3,619				4.28	%
Personal and home equity			417,427				3,666				3.53	%			411,152				3,732				3.65	%
Total loans, excluding covered assets (3)			9,401,870				102,953				4.34	%			9,070,703				101,587				4.44	%
Total interest-earning assets before covered assets (2)			11,910,498				119,975				3.99	%			11,531,880				119,079				4.10	%
Covered assets (4)			237,781				2,189				3.66	%			264,619				1,952				2.93	%
Total interest-earning assets (2)			12,148,279			$	122,164				3.99	%			11,796,499			$	121,031				4.07	%
Cash and due from banks			148,174												141,317
Allowance for loan and covered loan losses			(218,798	)											(224,071	)
Other assets			702,533												731,771
Total assets		$	12,780,188											$	12,445,516
Liabilities and Equity:
Interest-bearing demand deposits		$	795,833			$	799				0.40	%		$	654,791			$	636				0.39	%
Savings deposits			225,335				161				0.29	%			218,145				156				0.29	%
Money market accounts			3,920,627				4,104				0.42	%			4,199,855				4,446				0.43	%
Time deposits			1,341,312				3,862				1.16	%			1,352,361				3,933				1.17	%
Brokered deposits			1,382,207				1,532				0.45	%			811,069				1,084				0.54	%
Total interest-bearing deposits			7,665,314				10,458				0.55	%			7,236,221				10,255				0.57	%
Short-term borrowings			250,774				123				0.19	%			265,205				142				0.21	%
Long-term debt			379,463				5,538				5.82	%			379,793				5,578				5.85	%
Total interest-bearing liabilities			8,295,551				16,119				0.78	%			7,881,219				15,975				0.81	%
Noninterest-bearing demand deposits			2,995,802												3,054,679
Other liabilities			156,656												194,262
Equity			1,332,179												1,315,356
Total liabilities and equity		$	12,780,188											$	12,445,516
Net interest spread (2) (5)											3.21	%											3.26	%
Effect of noninterest-bearing funds											0.25	%											0.27	%
Net interest income/margin (2) (5)						$	106,045				3.46	%						$	105,056				3.53	%

 

(1)	Interest income included $6.3 million and $7.2 million in loan fees for the three months ended June 30, 2012 and March 31, 2012, 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 financial measure. Refer to Non-U.S. GAAP Financial 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 $222.1 million and $256.8 million for the three months ended June 30, 2012 and March 31, 2012, respectively, and are included in loans for purposes of this analysis. Interest foregone on impaired loans was estimated to be approximately $2.3 million and $2.8 million for the three months ended June 30, 2012 and March 31, 2012, 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.

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Net Interest Margin Unaudited   (Dollars in thousands)

 

		Six Months Ended June 30,
		2012												2011
		Average Balance				Interest (1)				Yield/ Rate				Average Balance				Interest (1)				Yield/ Rate
Assets:
Fed funds sold and other short-term investments		$	211,050			$	265				0.25	%		$	574,998			$	735				0.25	%
Securities:
Taxable			2,111,934				30,234				2.86	%			1,780,697				30,958				3.48	%
Tax-exempt (2)			161,919				4,015				4.96	%			144,413				4,380				6.07	%
Total securities			2,273,853				34,249				3.01	%			1,925,110				35,338				3.67	%
Loans, excluding covered assets:
Commercial			5,573,826				129,444				4.59	%			5,060,294				116,412				4.58	%
Commercial real estate			2,688,545				56,301				4.14	%			2,780,249				58,277				4.17	%
Construction			228,601				4,147				3.59	%			464,498				8,525				3.65	%
Residential			333,940				7,249				4.34	%			321,562				7,209				4.48	%
Personal and home equity			412,269				7,398				3.61	%			453,866				8,089				3.59	%
Total loans, excluding covered assets (3)			9,237,181				204,539				4.38	%			9,080,469				198,512				4.35	%
Total interest-earning assets before covered assets (2)			11,722,084				239,053				4.04	%			11,580,577				234,585				4.03	%
Covered assets (4)			251,200				4,142				3.28	%			342,668				9,526				5.54	%
Total interest-earning assets (2)			11,973,284			$	243,195				4.03	%			11,923,245			$	244,111				4.08	%
Cash and due from banks			144,741												163,802
Allowance for loan and covered loan losses			(221,434	)											(247,825	)
Other assets			705,779												663,580
Total assets		$	12,602,370											$	12,502,802
Liabilities and Equity:
Interest-bearing demand deposits		$	725,312			$	1,435				0.40	%		$	576,216			$	1,229				0.43	%
Savings deposits			221,740				317				0.29	%			201,168				408				0.41	%
Money market accounts			4,060,241				8,550				0.42	%			4,612,237				12,336				0.54	%
Time deposits			1,346,836				7,795				1.16	%			1,356,068				8,807				1.31	%
Brokered deposits			1,096,638				2,616				0.48	%			1,435,683				4,413				0.62	%
Total interest-bearing deposits			7,450,767				20,713				0.56	%			8,181,372				27,193				0.67	%
Short-term borrowings			257,990				265				0.20	%			92,377				1,393				3.00	%
Long-term debt			379,628				11,116				5.81	%			410,870				10,962				5.32	%
Total interest-bearing liabilities			8,088,385				32,094				0.79	%			8,684,619				39,548				0.91	%
Noninterest-bearing demand deposits			3,025,241												2,411,118
Other liabilities			164,977												157,315
Equity			1,323,767												1,249,750
Total liabilities and equity		$	12,602,370											$	12,502,802
Net interest spread (2) (5)											3.24	%											3.17	%
Effect of non interest-bearing funds											0.25	%											0.24	%
Net interest income/margin (2) (5)						$	211,101				3.49	%						$	204,563				3.41	%

 

(1)	Interest income included $13.6 million and $11.5 million in loan fees for the six months ended June 30, 2012 and 2011, 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 $240.3 million and $368.7 million for the six months ended June 30, 2012 and 2011, respectively, and are included in loans for purposes of this analysis. Interest foregone on impaired loans was estimated to be approximately $5.1 million and $7.7 million for the six months ended June 30, 2012 and 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.

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Non-U.S. GAAP Financial Measures Unaudited   (Amounts in thousands)

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. All of these measures exclude from capital the ending balances of goodwill and other intangibles while certain of these ratios exclude 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 financial measures are relevant because they provide information that is helpful in assessing 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
		2Q12				1Q12				4Q11				3Q11				2Q11
Taxable-equivalent interest income
U.S. GAAP net interest income		$	105,346			$	104,376			$	102,982			$	101,089			$	100,503
Taxable-equivalent adjustment			699				680				671				680				716
Taxable-equivalent net interest income (a)		$	106,045			$	105,056			$	103,653			$	101,769			$	101,219
Average Earning Assets (b)		$	12,148,279			$	11,796,499			$	11,696,741			$	11,446,323			$	11,916,038
Net Interest Margin ((a) annualized) / (b)			3.46	%			3.53	%			3.48	%			3.49	%			3.36	%
Net Revenue
Taxable-equivalent net interest income (a)		$	106,045			$	105,056			$	103,653			$	101,769			$	101,219
U.S. GAAP non-interest income			26,246				27,504				25,393				27,635				21,592
Net revenue		$	132,291			$	132,560			$	129,046			$	129,404			$	122,811
Operating Profit
U.S. GAAP income before income taxes		$	30,696			$	23,950			$	20,534			$	21,075			$	15,338
Provision for loan and covered loan losses			17,038				27,701				31,611				32,615				31,093
Taxable-equivalent adjustment			699				680				671				680				716
Operating profit		$	48,433			$	52,331			$	52,816			$	54,370			$	47,147
Efficiency Ratio
U.S. GAAP non-interest expense (c)		$	83,858			$	80,229			$	76,230			$	75,034			$	75,664
Taxable-equivalent net interest income (a)		$	106,045			$	105,056			$	103,653			$	101,769			$	101,219
U.S. GAAP non-interest income			26,246				27,504				25,393				27,635				21,592
Net revenue (d)		$	132,291			$	132,560			$	129,046			$	129,404			$	122,811
Efficiency ratio (c) / (d)			63.39	%			60.52	%			59.07	%			57.98	%			61.61	%

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Non-U.S. GAAP Financial Measures (continued) Unaudited (Amounts in thousands, except per share data)

 

		Six Months Ended June 30,
		2012				2011
Taxable-equivalent interest income
U.S. GAAP net interest income		$	209,722			$	203,056
Taxable-equivalent adjustment			1,379				1,507
Taxable-equivalent net interest income (a)		$	211,101			$	204,563
Average Earning Assets (b)		$	11,973,284			$	11,923,245
Net Interest Margin ((a) annualized) / (b)			3.49	%			3.41	%
Net Revenue
Taxable-equivalent net interest income (a)		$	211,101			$	204,563
U.S. GAAP non-interest income			53,750				45,219
Net revenue		$	264,851			$	249,782
Operating Profit
U.S. GAAP income before income taxes		$	54,646			$	28,591
Provision for loan and covered loan losses			44,739				68,671
Taxable-equivalent adjustment			1,379				1,507
Operating profit		$	100,764			$	98,769
Efficiency Ratio
U.S. GAAP non-interest expense (c)		$	164,087			$	151,013
Taxable-equivalent net interest income (a)		$	211,101			$	204,563
U.S. GAAP non-interest income			53,750				45,219
Net revenue (d)		$	264,851			$	249,782
Efficiency ratio (c) / (d)			61.95	%			60.46	%

 

		Quarters Ended
		2Q12				1Q12				4Q11				3Q11				2Q11
Tier 1 Common Capital
U.S. GAAP total equity		$	1,334,154			$	1,312,154			$	1,296,752			$	1,286,176			$	1,260,648
Trust preferred securities			244,793				244,793				244,793				244,793				244,793
Less: accumulated other comprehensive income, net of tax			50,987				47,152				46,697				46,051				32,535
Less: goodwill			94,546				94,559				94,571				94,584				94,596
Less: other intangibles			14,152				14,683				15,353				15,715				16,089
Tier 1 risk-based capital			1,419,262				1,400,553				1,384,924				1,374,619				1,362,221
Less: preferred stock			241,185				240,791				240,403				240,020				239,642
Less: trust preferred securities			244,793				244,793				244,793				244,793				244,793
Less: noncontrolling interests			—				—				—				—				163
Tier 1 common capital (e)		$	933,284			$	914,969			$	899,728			$	889,806			$	877,623
Tangible Common Equity
U.S. GAAP total equity		$	1,334,154			$	1,312,154			$	1,296,752			$	1,286,176			$	1,260,648
Less: goodwill			94,546				94,559				94,571				94,584				94,596
Less: other intangibles			14,152				14,683				15,353				15,715				16,089
Tangible equity (f)			1,225,456				1,202,912				1,186,828				1,175,877				1,149,963
Less: preferred stock			241,185				240,791				240,403				240,020				239,642
Tangible common equity (g)		$	984,271			$	962,121			$	946,425			$	935,857			$	910,321
Tangible Assets
U.S. GAAP total assets		$	12,942,176			$	12,623,164			$	12,416,870			$	12,019,861			$	12,115,377
Less: goodwill			94,546				94,559				94,571				94,584				94,596
Less: other intangibles			14,152				14,683				15,353				15,715				16,089
Tangible assets (h)		$	12,833,478			$	12,513,922			$	12,306,946			$	11,909,562			$	12,004,692
Risk-weighted Assets (i) (1)		$	11,588,371			$	11,374,212			$	11,191,298			$	10,665,256			$	10,518,850
Period-end Common Shares Outstanding (j)			72,424				72,415				71,745				71,789				71,808
Ratios:
Tier 1 common equity to risk-weighted assets (e) / (i) (1)			8.05	%			8.04	%			8.04	%			8.34	%			8.34	%
Tangible equity to tangible assets (f) / (h)			9.55	%			9.61	%			9.64	%			9.87	%			9.58	%
Tangible equity to risk-weighted assets (f) / (i) (1)			10.57	%			10.58	%			10.60	%			11.03	%			10.93	%
Tangible common equity to tangible assets (g) / (h)			7.67	%			7.69	%			7.69	%			7.86	%			7.58	%
Tangible book value (g) / (j)		$	13.59			$	13.29			$	13.19			$	13.04			$	12.68

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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^®.

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 financial measures may be found on the previous 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.

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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.