MUFG Americas Holdings Corp - FORM 8-K - EX-99.2 - EXHIBIT 99.2

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8-K - 8-K - MUFG Americas Holdings Corp	muah-33115x8k.htm
EX-99.1 - EXHIBIT 99.1 - MUFG Americas Holdings Corp	muah-33115xearningsex991.htm

MUFG Americas Holdings Corporation Exhibit 99.2

FINANCIAL SUPPLEMENT MARCH 31, 2015

MUFG Americas Holdings Corporation and Subsidiaries

Financial Highlights (Unaudited)



																Percent Change to
	As of and for the Three Months Ended															March 31, 2015 from
(Dollars in millions)	March 31, 2015			December 31, 2014 ⁽¹⁾			September 30, 2014 ⁽¹⁾			June 30, 2014 ⁽¹⁾			March 31, 2014 ⁽¹⁾			December 31, 2014		March 31, 2014
Results of operations:
Net interest income	$	683		$	709		$	707		$	763		$	683		(4	)%	—	%
Noninterest income	335			352			388			202			181			(5	)	85
Total revenue	1,018			1,061			1,095			965			864			(4	)	18
Noninterest expense	849			797			765			634			627			7		35
Pre-tax, pre-provision income ⁽²⁾	169			264			330			331			237			(36	)	(29	)
(Reversal of) provision for credit losses	3			(1		)	1			6			—			400		nm
Income before income taxes and including
noncontrolling interests	166			265			329			325			237			(37	)	(30	)
Income tax expense	34			117			87			85			70			(71	)	(51	)
Net income including noncontrolling interests	132			148			242			240			167			(11	)	(21	)
Deduct: Net loss from noncontrolling interests	5			5			5			4			5			—		—
Net income attributable to
MUFG Americas Holdings Corporation (MUAH)	$	137		$	153		$	247		$	244		$	172		(10	)	(20	)

Balance sheet (end of period):
Total assets	$	113,698		$	113,662		$	110,867		$	108,809		$	107,231		—		6
Total securities	22,463			22,015			22,522			22,847			23,192			2		(3	)
Total loans held for investment	76,808			76,804			74,635			72,369			69,933			—		10
Core deposits ⁽³⁾	74,190			76,666			73,608			72,058			70,665			(3	)	5
Total deposits	82,741			86,004			82,356			81,566			81,179			(4	)	2
Long-term debt	8,856			6,972			6,984			6,995			6,545			27		35
MUAH stockholder's equity	15,200			14,922			14,990			14,753			14,403			2		6

Balance sheet (period average):
Total assets	$	113,134		$	112,589		$	109,739		$	107,871		$	106,491		—		6
Total securities	22,172			22,171			22,592			22,865			22,611			—		(2	)
Total loans held for investment	77,305			75,795			73,353			71,104			69,293			2		12
Earning assets	102,645			101,430			98,933			97,405			96,100			1		7
Total deposits	84,088			84,036			82,239			81,221			80,433			—		5
MUAH stockholder's equity	15,069			15,202			14,969			14,657			14,390			(1	)	5

Performance ratios:
Return on average assets ⁽⁴⁾	0.49		%	0.54		%	0.90		%	0.91		%	0.65		%
Return on average MUAH stockholder's equity ⁽⁴⁾	3.65			4.02			6.60			6.66			4.78
Return on average assets excluding the impact of privatization
transaction and merger costs related to acquisitions ^{(4) (5)}	0.53			0.62			0.94			0.95			0.70
Return on average MUAH stockholder's equity excluding the
impact of privatization transaction and merger costs related to
acquisitions ^{(4) (5)}	4.51			5.23			7.87			8.02			6.00
Efficiency ratio ⁽⁶⁾	83.35			75.07			69.86			65.71			72.61
Adjusted efficiency ratio ⁽⁷⁾	74.90			67.24			63.42			60.30			67.95
Net interest margin ^{(4) (8)}	2.70			2.81			2.87			3.15			2.87

Capital ratios:

Regulatory:	U.S. Basel III			U.S. Basel I			U.S. Basel III
Common Equity Tier 1 risk-based capital ratio ^{(9) (10)}	12.68		%	n/a			12.66		%	12.58		%	12.59		%
Tier 1 risk-based capital ratio ^{(9) (10)}	12.68			12.79		%	12.70			12.62			12.62
Total risk-based capital ratio ^{(9) (10)}	14.46			14.74			14.60			14.57			14.75
Tier 1 leverage ratio ^{(9) (10)}	11.30			11.25			11.43			11.35			11.26

Other:
Tangible common equity ratio ⁽¹¹⁾	10.69		%	10.48		%	10.74		%	10.78		%	10.60		%
Tier 1 common capital ratio ^{(9) (10) (12)}	n/a			12.74			n/a			n/a			n/a
Common Equity Tier 1 risk-based capital ratio (U.S. Basel III standardized; transitional) ^{(9) (13)}	n/a			12.85			n/a			n/a			n/a
Common Equity Tier 1 risk-based capital ratio (U.S. Basel III standardized approach; fully phased in) ^{(9) (14)}	12.61			12.56			12.47			12.13			11.98

____________________________________________

Refer to Exhibit 12 for footnote explanations.



	Exhibit 1

MUFG Americas Holdings Corporation and Subsidiaries

Credit Quality (Unaudited)



																Percent Change to
	As of and for the Three Months Ended															March 31, 2015 from
(Dollars in millions)	March 31, 2015			December 31, 2014			September 30, 2014			June 30, 2014			March 31, 2014			December 31, 2014		March 31, 2014

Credit Data:
(Reversal of) provision for loan losses	$	(3	)	$	9		$	(18	)	$	9		$	(16	)	(133	)%	81	%
(Reversal of) provision for losses on unfunded credit commitments	6			(10		)	19			(3		)	16			160		(63	)
Total (reversal of) provision for credit losses	$	3		$	(1	)	$	1		$	6		$	—		400		100

Net loans charged-off (recovered)	$	3		$	(1	)	$	12		$	7		$	(6	)	400		150
Nonperforming assets	390			411			428			547			506			(5	)	(23	)
Criticized loans held for investment ⁽¹⁵⁾	1,327			1,141			1,245			1,450			1,317			16		1

Credit Ratios:
Allowance for loan losses to:
Total loans held for investment	0.69		%	0.70		%	0.71		%	0.77		%	0.80		%
Nonaccrual loans	147.21			143.35			131.28			108.90			119.58
Allowance for credit losses to ⁽¹⁶⁾:
Total loans held for investment	0.90			0.90			0.92			0.97			1.01
Nonaccrual loans	191.20			183.80			171.42			137.13			151.35
Net loans charged-off (recovered) to average total loans held for investment ⁽⁴⁾	0.01			—			0.06			0.04			(0.04		)
Nonperforming assets to total loans held for investment and Other Real Estate Owned (OREO)	0.51			0.53			0.57			0.75			0.72
Nonperforming assets to total assets	0.34			0.36			0.39			0.50			0.47
Nonaccrual loans to total loans held for investment	0.47			0.49			0.54			0.71			0.67

________________________________________

Refer to Exhibit 12 for footnote explanations.



	Exhibit 2

MUFG Americas Holdings Corporation and Subsidiaries

Consolidated Statements of Income (Unaudited)



			For the Three Months Ended
(Dollars in millions)			March 31, 2015		December 31, 2014 ⁽¹⁾			September 30, 2014 ⁽¹⁾		June 30, 2014⁽¹⁾		March 31, 2014 ⁽¹⁾
Interest Income
	Loans		$	678	$	696		$	693	$	749	$	667
	Securities		102		109			113		115		115
	Other		3		3			2		3		5
		Total interest income	783		808			808		867		787

Interest Expense
	Deposits		52		57			58		61		62
	Commercial paper and other short-term borrowings		1		1			1		2		1
	Long-term debt		47		41			42		41		41
		Total interest expense	100		99			101		104		104

Net Interest Income			683		709			707		763		683
	(Reversal of) provision for credit losses		3		(1		)	1		6		—
		Net interest income after (reversal of) provision for credit losses	680		710			706		757		683

Noninterest Income
	Service charges on deposit accounts		49		50			52		50		51
	Trust and investment management fees		28		26			26		26		26
	Trading account activities		8		8			33		14		16
	Securities gains, net		3		2			13		1		2
	Credit facility fees		30		33			30		31		28
	Merchant banking fees		20		35			38		27		24
	Brokerage commissions and fees		13		13			14		13		13
	Card processing fees, net		8		9			8		9		8
	Fees from affiliates ⁽¹⁷⁾		166		168			151		—		—
	Other, net		10		8			23		31		13
		Total noninterest income	335		352			388		202		181

Noninterest Expense
	Salaries and employee benefits		567		527			492		378		388
	Net occupancy and equipment		80		76			74		75		71
	Professional and outside services		77		72			66		63		55
	Intangible asset amortization		10		13			13		13		13
	Regulatory assessments		13		13			13		16		15
	Other		102		96			107		89		85
		Total noninterest expense	849		797			765		634		627

	Income before income taxes and including
	noncontrolling interests		166		265			329		325		237
	Income tax expense		34		117			87		85		70
Net Income including Noncontrolling Interests			132		148			242		240		167
	Deduct: Net loss from noncontrolling interests		5		5			5		4		5
Net Income attributable to MUAH			$	137	$	153		$	247	$	244	$	172

____________________________________________

Refer to Exhibit 12 for footnote explanations.



	Exhibit 3

MUFG Americas Holdings Corporation and Subsidiaries

Consolidated Balance Sheets (Unaudited)



(Dollars in millions except for per share amount)				March 31, 2015			December 31, 2014 ⁽¹⁾			September 30, 2014 ⁽¹⁾			June 30, 2014 ⁽¹⁾			March 31, 2014 ⁽¹⁾
Assets
Cash and due from banks				$	1,735		$	1,759		$	1,593		$	1,911		$	1,792
Interest bearing deposits in banks				2,787			3,930			2,772			2,353			2,883
Federal funds sold and securities purchased under resale agreements				92			62			154			65			32
		Total cash and cash equivalents		4,614			5,751			4,519			4,329			4,707
Trading account assets				1,233			1,114			883			941			841
Securities available for sale				13,338			13,724			14,064			14,670			15,366
Securities held to maturity:
	Securities held to maturity			9,125			8,291			8,458			8,177			7,826
Loans held for investment				76,808			76,804			74,635			72,369			69,933
	Allowance for loan losses			(530		)	(537		)	(529		)	(559		)	(557		)
		Loans held for investment, net		76,278			76,267			74,106			71,810			69,376
Premises and equipment, net				623			621			617			632			641
Goodwill				3,225			3,225			3,227			3,227			3,227
Other assets				5,262			4,669			4,993			5,023			5,247
			Total assets	$	113,698		$	113,662		$	110,867		$	108,809		$	107,231

Liabilities
Deposits:
	Noninterest bearing			$	29,854		$	30,534		$	28,676		$	27,446		$	26,881
	Interest bearing			52,887			55,470			53,680			54,120			54,298
		Total deposits		82,741			86,004			82,356			81,566			81,179
Commercial paper and other short-term borrowings				3,475			2,704			3,876			2,870			2,660
Long-term debt				8,856			6,972			6,984			6,995			6,545
Trading account liabilities				944			894			596			664			531
Other liabilities				2,266			1,936			1,826			1,717			1,662
			Total liabilities	98,282			98,510			95,638			93,812			92,577

Equity
MUAH stockholder's equity:
	Common stock, par value $1 per share:
		Authorized 300,000,000 shares; 136,330,831 shares issued and outstanding as of March 31, 2015 and December 31, 2014; and 136,330,830 as of September 30, 2014, June 30, 2014, and March 31, 2014 respectively		136			136			136			136			136
	Additional paid-in capital			7,241			7,232			7,223			7,184			7,196
	Retained earnings			8,420			8,283			8,130			7,874			7,630
	Accumulated other comprehensive loss			(597		)	(729		)	(499		)	(441		)	(559		)
			Total MUAH stockholder's equity	15,200			14,922			14,990			14,753			14,403
Noncontrolling interests				216			230			239			244			251
			Total equity	15,416			15,152			15,229			14,997			14,654
			Total liabilities and equity	$	113,698		$	113,662		$	110,867		$	108,809		$	107,231

____________________________________________

Refer to Exhibit 12 for footnote explanations.



	Exhibit 4

MUFG Americas Holdings Corporation and Subsidiaries

Net Interest Income (Unaudited)



	For the Three Months Ended
	March 31, 2015							December 31, 2014
				Interest		Average					Interest		Average
	Average			Income/		Yield/		Average			Income/		Yield/
(Dollars in millions)	Balance			Expense ⁽⁸⁾		Rate ⁽⁴⁾⁽⁸⁾		Balance			Expense ⁽⁸⁾		Rate ⁽⁴⁾⁽⁸⁾
Assets
Loans held for investment: ⁽¹⁸⁾
Commercial and industrial	$	28,394		$	223	3.18	%	$	27,138		$	228	3.33	%
Commercial mortgage	13,903			115		3.31		13,833			117		3.39
Construction	1,853			14		3.03		1,557			12		3.00
Lease financing	776			10		5.11		810			10		4.97
Residential mortgage	28,766			247		3.43		28,738			253		3.52
Home equity and other consumer loans	3,103			32		4.22		3,137			33		4.20
Loans, before purchased credit-impaired loans	76,795			641		3.36		75,213			653		3.46
Purchased credit-impaired loans	510			38		30.49		582			44		30.08
Total loans held for investment	77,305			679		3.54		75,795			697		3.67
Securities	22,172			106		1.92		22,171			113		2.04
Interest bearing deposits in banks	2,776			2		0.25		2,788			2		0.26
Federal funds sold and securities purchased under resale agreements	97			—		—		149			—		0.05
Trading account assets	196			—		0.70		196			—		0.72
Other earning assets	99			1		2.07		331			1		0.68
Total earning assets	102,645			788		3.09		101,430			813		3.20
Allowance for loan losses	(542		)					(533		)
Cash and due from banks	1,631							1,727
Premises and equipment, net	621							614
Other assets ⁽¹⁹⁾	8,779							9,351
Total assets	$	113,134						$	112,589
Liabilities
Interest bearing deposits:
Transaction and money market accounts	$	39,713		30		0.31		$	39,762		33		0.33
Savings	5,550			1		0.06		5,555			1		0.08
Time	8,975			21		0.93		9,133			23		0.97
Total interest bearing deposits	54,238			52		0.39		54,450			57		0.41
Commercial paper and other short-term borrowings ⁽²⁰⁾	2,991			1		0.20		3,257			1		0.19
Long-term debt	8,008			47		2.34		6,983			41		2.36
Total borrowed funds	10,999			48		1.76		10,240			42		1.67
Total interest bearing liabilities	65,237			100		0.62		64,690			99		0.61
Noninterest bearing deposits	29,850							29,586
Other liabilities ⁽²¹⁾	2,750							2,873
Total liabilities	97,837							97,149
Equity
MUAH Stockholder's equity	15,069							15,202
Noncontrolling interests	228							238
Total equity	15,297							15,440
Total liabilities and equity	$	113,134						$	112,589

Net interest income/spread (taxable-equivalent basis)				688		2.47	%				714		2.59	%
Impact of noninterest bearing deposits						0.19							0.19
Impact of other noninterest bearing sources						0.04							0.03
Net interest margin						2.70							2.81
Less: taxable-equivalent adjustment				5							5
Net interest income				$	683						$	709

____________________________________________

Refer to Exhibit 12 for footnote explanations.



	Exhibit 5

MUFG Americas Holdings Corporation and Subsidiaries

Net Interest Income (Unaudited)



	For the Three Months Ended
	March 31, 2015							March 31, 2014
				Interest		Average					Interest		Average
	Average			Income/		Yield/		Average			Income/		Yield/
(Dollars in millions)	Balance			Expense ⁽⁸⁾		Rate ⁽⁴⁾⁽⁸⁾		Balance			Expense ⁽⁸⁾		Rate ⁽⁴⁾⁽⁸⁾
Assets
Loans held for investment: ⁽¹⁸⁾
Commercial and industrial	$	28,394		$	223	3.18	%	$	23,969		$	198	3.34	%
Commercial mortgage	13,903			115		3.31		13,230			119		3.61
Construction	1,853			14		3.03		946			8		3.67
Lease financing	776			10		5.11		849			11		5.41
Residential mortgage	28,766			247		3.43		25,990			238		3.66
Home equity and other consumer loans	3,103			32		4.22		3,233			32		3.99
Loans, before purchased credit-impaired loans	76,795			641		3.36		68,217			606		3.58
Purchased credit-impaired loans	510			38		30.49		1,076			61		22.90
Total loans held for investment	77,305			679		3.54		69,293			667		3.88
Securities	22,172			106		1.92		22,611			120		2.12
Interest bearing deposits in banks	2,776			2		0.25		3,565			2		0.25
Federal funds sold and securities purchased under resale agreements	97			—		—		131			—		0.18
Trading account assets	196			—		0.70		267			2		3.08
Other earning assets	99			1		2.07		233			1		1.40
Total earning assets	102,645			788		3.09		96,100			792		3.31
Allowance for loan losses	(542		)					(577		)
Cash and due from banks	1,631							1,499
Premises and equipment, net	621							645
Other assets ⁽¹⁹⁾	8,779							8,824
Total assets	$	113,134						$	106,491
Liabilities
Interest bearing deposits:
Transaction and money market accounts	$	39,713		30		0.31		$	37,519		36		0.38
Savings	5,550			1		0.06		5,572			1		0.11
Time	8,975			21		0.93		11,214			25		0.92
Total interest bearing deposits	54,238			52		0.39		54,305			62		0.47
Commercial paper and other short-term borrowings ⁽²⁰⁾	2,991			1		0.20		2,632			1		0.21
Long-term debt	8,008			47		2.34		6,546			41		2.47
Total borrowed funds	10,999			48		1.76		9,178			42		1.82
Total interest bearing liabilities	65,237			100		0.62		63,483			104		0.66
Noninterest bearing deposits	29,850							26,128
Other liabilities ⁽²¹⁾	2,750							2,237
Total liabilities	97,837							91,848
Equity
MUAH Stockholder's equity	15,069							14,390
Noncontrolling interests	228							253
Total equity	15,297							14,643
Total liabilities and equity	$	113,134						$	106,491

Net interest income/spread (taxable-equivalent basis)				688		2.47	%				688		2.65	%
Impact of noninterest bearing deposits						0.19							0.19
Impact of other noninterest bearing sources						0.04							0.03
Net interest margin						2.70							2.87
Less: taxable-equivalent adjustment				5							5
Net interest income				$	683						$	683

____________________________________________

Refer to Exhibit 12 for footnote explanations.



	Exhibit 6

MUFG Americas Holdings Corporation and Subsidiaries

Loans and Nonperforming Assets (Unaudited)



(Dollars in millions)					March 31, 2015		December 31, 2014		September 30, 2014		June 30, 2014		March 31, 2014

Loans held for investment (period end)
	Loans held for investment:
		Commercial and industrial			$	27,979	$	27,623	$	26,429	$	25,162	$	23,654
		Commercial mortgage			13,923		14,016		13,766		13,549		13,568
		Construction			1,996		1,746		1,436		1,248		1,019
		Lease financing			776		800		811		829		845
			Total commercial portfolio		44,674		44,185		42,442		40,788		39,086

		Residential mortgage			28,558		28,977		28,425		27,619		26,602
		Home equity and other consumer loans			3,081		3,117		3,141		3,178		3,194
			Total consumer portfolio		31,639		32,094		31,566		30,797		29,796
				Loans held for investment, before purchased credit-impaired loans	76,313		76,279		74,008		71,585		68,882
		Purchased credit-impaired loans			495		525		627		784		1,051

				Total loans held for investment	$	76,808	$	76,804	$	74,635	$	72,369	$	69,933

Nonperforming Assets (period end)
	Nonaccrual loans:
		Commercial and industrial			$	52	$	55	$	71	$	161	$	89
		Commercial mortgage			40		40		34		47		46
			Total commercial portfolio		92		95		105		208		135

		Residential mortgage			221		231		239		243		266
		Home equity and other consumer loans			39		40		46		46		49
			Total consumer portfolio		260		271		285		289		315

				Nonaccrual loans, before purchased credit-impaired loans	352		366		390		497		450
		Purchased credit-impaired loans			9		9		13		17		16
				Total nonaccrual loans	361		375		403		514		466

	OREO				29		36		25		33		40

				Total nonperforming assets	$	390	$	411	$	428	$	547	$	506

	Loans 90 days or more past due and still accruing ⁽²²⁾				$	4	$	3	$	4	$	11	$	4

__________________________________________

Refer to Exhibit 12 for footnote explanations.



	Exhibit 7

MUFG Americas Holdings Corporation and Subsidiaries

Allowance for Credit Losses (Unaudited)



	As of and for the Three Months Ended
(Dollars in millions)	March 31, 2015			December 31, 2014			September 30, 2014			June 30, 2014			March 31, 2014

Analysis of Allowance for Credit Losses
Balance, beginning of period	$	537		$	529		$	559		$	557		$	568
(Reversal of) provision for loan losses	(3		)	9			(18		)	9			(16		)
Other	(1		)	(2		)	—			—			(1		)
Loans charged-off:
Commercial and industrial	(1		)	(8		)	(15		)	(6		)	(5		)
Commercial mortgage	(3		)	(1		)	—			(2		)	(1		)
Total commercial portfolio	(4		)	(9		)	(15		)	(8		)	(6		)
Residential mortgage	(1		)	—			—			(2		)	(1		)
Home equity and other consumer loans	(2		)	(2		)	(2		)	(2		)	(2		)
Total consumer portfolio	(3		)	(2		)	(2		)	(4		)	(3		)
Purchased credit-impaired loans	—			—			(1		)	—			—
Total loans charged-off	(7		)	(11		)	(18		)	(12		)	(9		)
Recoveries of loans previously charged-off:
Commercial and industrial	4			10			3			3			11
Commercial mortgage	—			—			2			1			—
Construction	—			—			—			—			3
Total commercial portfolio	4			10			5			4			14
Home equity and other consumer loans	—			2			—			1			1
Total consumer portfolio	—			2			—			1			1
Purchased credit-impaired loans	—			—			1			—			—
Total recoveries of loans previously charged-off	4			12			6			5			15
Net loans recovered (charged-off)	(3		)	1			(12		)	(7		)	6

Ending balance of allowance for loan losses	530			537			529			559			557
Allowance for losses on unfunded credit commitments	158			152			162			145			148
Total allowance for credit losses	$	688		$	689		$	691		$	704		$	705



	Exhibit 8

MUFG Americas Holdings Corporation and Subsidiaries

Securities (Unaudited)



Securities Available for Sale

			March 31, 2015				December 31, 2014				Fair Value			Fair Value
			Amortized		Fair		Amortized		Fair		Change from			% Change from
(Dollars in millions)			Cost		Value		Cost		Value		December 31, 2014			December 31, 2014
Asset Liability Management securities:
U.S. Treasury			$	147	$	149	$	—	$	—	$	149		100	%
Residential mortgage-backed securities:
	U.S. government agency and government-sponsored agencies		7,249		7,228		7,649		7,560		(332		)	(4	)
	Privately issued		155		156		166		168		(12		)	(7	)
Privately issued - commercial mortgage-backed securities			1,573		1,604		1,689		1,691		(87		)	(5	)
Collateralized loan obligations			2,503		2,487		2,527		2,494		(7		)	—
Asset-backed and other			8		9		8		9		—			—
		Asset Liability Management securities	11,635		11,633		12,039		11,922		(289		)	(2	)
Other debt securities:
Direct bank purchase bonds			1,626		1,647		1,719		1,741		(94		)	(5	)
Other			50		49		53		52		(3		)	(6	)
Equity securities			8		9		8		9		—			—
		Total securities available for sale	$	13,319	$	13,338	$	13,819	$	13,724	$	(386	)	(3	)%

Securities Held to Maturity

			March 31, 2015				December 31, 2014				Carrying Amount			Carrying Amount
			Carrying		Fair		Carrying		Fair		Change from			% Change from
(Dollars in millions)			Amount ⁽²³⁾		Value		Amount ⁽²³⁾		Value		December 31, 2014			December 31, 2014
U.S. Treasury			$	487	$	497	$	486	$	489	$	1		—	%
U.S. government-sponsored agencies			497		498		125		125		372			298
U.S. government agency and government-
	sponsored agencies - residential mortgage-backed securities		6,421		6,545		5,942		6,013		479			8
U.S. government agency and government-
	sponsored agencies - commercial mortgage-backed securities		1,720		1,793		1,738		1,785		(18		)	(1	)
		Total securities held to maturity	$	9,125	$	9,333	$	8,291	$	8,412	$	834		10	%

___________________________________________

Refer to Exhibit 12 for footnote explanations.



	Exhibit 9

MUFG Americas Holdings Corporation and Subsidiaries

Reconciliation of Non-GAAP Measures (Unaudited)

The following table presents a reconciliation between certain Generally Accepted Accounting Principles (GAAP) amounts and specific non-GAAP measures as used to compute selected non-GAAP financial ratios.



		As of and for the Three Months Ended
(Dollars in millions)		March 31, 2015			December 31, 2014 ⁽¹⁾			September 30, 2014 ⁽¹⁾			June 30, 2014 ⁽¹⁾			March 31, 2014 ⁽¹⁾
Net income attributable to MUAH		$	137		$	153		$	247		$	244		$	172
Net adjustments for merger costs related to acquisitions, net of tax		6			12			13			15			11
Net adjustments for privatization transaction, net of tax		3			6			(8		)	(9		)	1
Net income attributable to MUAH, excluding impact of
	privatization transaction and merger costs related to acquisitions	$	146		$	171		$	252		$	250		$	184

Average total assets		$	113,134		$	112,589		$	109,739		$	107,871		$	106,491
Less: Net adjustments related to privatization transaction		2,235			2,244			2,255			2,260			2,272
Average total assets, excluding impact of privatization transaction		$	110,899		$	110,345		$	107,484		$	105,611		$	104,219
Return on average assets ⁽⁴⁾		0.49		%	0.54		%	0.90		%	0.91		%	0.65		%
Return on average assets, excluding impact of privatization
	transaction and merger costs related to acquisitions^{(4) (5)}	0.53			0.62			0.94			0.95			0.70

Average MUAH stockholder's equity		$	15,069		$	15,202		$	14,969		$	14,657		$	14,390
Less: Adjustments for merger costs related to acquisitions		(167		)	(157		)	(147		)	(132		)	(118		)
Less: Net adjustments for privatization transaction		2,276			2,279			2,290			2,297			2,302
Average MUAH stockholder's equity, excluding impact of privatization
	transaction and merger costs related to acquisitions	$	12,960		$	13,080		$	12,826		$	12,492		$	12,206
Return on average MUAH stockholder's equity ⁽⁴⁾		3.65		%	4.02		%	6.60		%	6.66		%	4.78		%
Return on average MUAH stockholder's equity, excluding impact of
	privatization transaction and merger costs related to acquisitions^{(4) (5)}	4.51			5.23			7.87			8.02			6.00

Noninterest expense		$	849		$	797		$	765		$	634		$	627
Less: Staff costs associated with fees from affiliates - support services		112			105			88			—			—
Less: Foreclosed asset expense and other credit costs		1			(2		)	(1		)	1			—
Less: Productivity initiative costs		28			2			6			4			1
Less: Low income housing credit (LIHC) investment amortization expense		2			4			4			2			3
Less: Expenses of the LIHC consolidated VIEs		9			8			8			8			8
Less: Merger and business integration costs		9			20			22			25			17
Less: Net adjustments related to privatization transaction		8			10			11			10			10
Less: Intangible asset amortization		3			3			3			3			3
	Noninterest expense, as adjusted (a)	$	677		$	647		$	624		$	581		$	585

Total revenue		$	1,018		$	1,061		$	1,095		$	965		$	864
Add: Net interest income taxable-equivalent adjustment		5			5			6			5			5
Less: Fees from affiliates - support services		121			112			94			—			—
Less: Productivity initiative gains		1			(1		)	—			—			—
Less: Accretion related to privatization-related fair value adjustments		1			(1		)	4			9			6
Less: Other credit costs		(4		)	(6		)	17			(2		)	2
	Total revenue, as adjusted (b)	$	904		$	962		$	986		$	963		$	861
Adjusted efficiency ratio (a)/(b) ⁽⁷⁾		74.90		%	67.24		%	63.42		%	60.30		%	67.95		%

____________________________________________

Refer to Exhibit 12 for footnote explanations.



	Exhibit 10

MUFG Americas Holdings Corporation and Subsidiaries

Reconciliation of Non-GAAP Measures (Unaudited)



		As of and for the Three Months Ended
(Dollars in millions)		March 31, 2015			December 31, 2014 ⁽¹⁾			September 30, 2014 ⁽¹⁾			June 30, 2014 ⁽¹⁾			March 31, 2014 ⁽¹⁾
Total MUAH stockholder's equity		$	15,200		$	14,922		$	14,990		$	14,753		$	14,403
Less: Goodwill		3,225			3,225			3,227			3,227			3,227
Less: Intangible assets, except mortgage servicing rights (MSRs)		222			233			249			262			275
Less: Deferred tax liabilities related to goodwill and intangible assets		(40		)	(99		)	(20		)	(99		)	(102		)
	Tangible common equity (c)	$	11,793		$	11,563		$	11,534		$	11,363		$	11,003
Total assets		$	113,698		$	113,662		$	110,867		$	108,809		$	107,231
Less: Goodwill		3,225			3,225			3,227			3,227			3,227
Less: Intangible assets, except MSRs		222			233			249			262			275
Less: Deferred tax liabilities related to goodwill and intangible assets		(40		)	(99		)	(20		)	(99		)	(102		)
	Tangible assets (d)	$	110,291		$	110,303		$	107,411		$	105,419		$	103,831
Tangible common equity ratio (c)/(d) ⁽¹¹⁾		10.69		%	10.48		%	10.74		%	10.78		%	10.60		%

Tier 1 capital, determined in accordance with U.S. Basel I regulatory requirements		n/a			$	12,367		n/a			n/a			n/a
Less: Junior subordinated debt payable to trusts		n/a			51			n/a			n/a			n/a
	U.S. Basel I Tier 1 common capital (e)	n/a			$	12,316		n/a			n/a			n/a
Common Equity Tier 1 capital under U.S. Basel III (standardized transitional) (f)		$	12,480		$	12,450		$	12,300		$	11,964		$	11,750
Other ⁽⁹⁾		(81		)	(117		)	(121		)	(130		)	(138		)
	Common Equity Tier 1 capital estimated under U.S. Basel III (standardized approach; fully phased-in) (g)	$	12,399		$	12,333		$	12,179		$	11,834		$	11,612
Risk-weighted assets, determined in accordance with U.S. Basel I regulatory requirements (h)		n/a			$	96,663		n/a			n/a			n/a
Add: Adjustments		n/a			205			n/a			n/a			n/a
Risk-weighted assets, estimated under U.S. Basel III (standardized transitional) (i)		$	98,398		96,868			$	96,239		$	94,556		$	92,476
Add: Adjustments		(74		)	1,301			1,441			2,963			4,427
	Total risk-weighted assets, estimated under U.S. Basel III (standardized approach; fully phased in) (j)	$	98,324		$	98,169		$	97,680		$	97,519		$	96,903
Tier 1 common capital ratio (e)/(h) ^{(9) (10) (12)}		n/a			12.74		%	n/a			n/a			n/a
Common Equity Tier 1 risk-based capital ratio (U.S. Basel III standardized; transitional) (f)/(i) ^{(9) (13)}		n/a			12.85			n/a			n/a			n/a
Common Equity Tier 1 risk-based capital ratio (U.S. Basel III standardized approach; fully phased in) (g)/(j) ^{(9) (14)}		12.61		%	12.56			12.47		%	12.13		%	11.98		%

____________________________________________

Refer to Exhibit 12 for footnote explanations.



	Exhibit 11

MUFG Americas Holdings Corporation and Subsidiaries

Footnotes


(1)	Prior period amounts have been revised to reflect the January 1, 2015 adoption of Accounting Standards Update 2014-01 related to investments in qualified affordable housing projects.


(2)	Pre-tax, pre-provision income is total revenue less noninterest expense. Management believes that this is a useful financial measure because it enables investors and others to assess the Company's ability to generate capital to cover loan losses through a credit cycle.


(3)	Core deposits exclude brokered deposits, foreign time deposits and domestic time deposits greater than $250,000.


(4)	Annualized.


(5)	These ratios exclude the impact of the privatization transaction and merger costs related to acquisitions. Management believes that these ratios provide useful supplemental information regarding the Company's business results. Please refer to Exhibit 10 for reconciliations between certain GAAP amounts and these non-GAAP measures.


(6)	The efficiency ratio is total noninterest expense as a percentage of total revenue (net interest income and noninterest income).

(7)

The adjusted efficiency ratio, a non-GAAP financial measure, is adjusted noninterest expense (noninterest expense excluding staff costs associated with fees from affiliates - support services, foreclosed asset expense and other credit costs, certain costs related to productivity initiatives, low income housing credit (LIHC) investment amortization expense, expenses of the LIHC consolidated variable interest entities, merger and business integration costs, privatization-related expenses, and intangible asset amortization) as a percentage of adjusted total revenue (net interest income (taxable-equivalent basis) and noninterest income), excluding the impact of fees from affiliates - support services, gains from productivity initiatives related to the sale of certain business units and premises, accretion related to privatization-related fair value adjustments, and other credit costs. Management discloses the adjusted efficiency ratio as a measure of the efficiency of our operations, focusing on those costs most relevant to our business activities. Please refer to Exhibit 10 for reconciliations between certain GAAP amounts and these non-GAAP measures.


(8)	Yields, interest income and net interest margin are presented on a taxable-equivalent basis using the federal statutory tax rate of 35%.


(9)	Preliminary as of March 31, 2015.


(10)	The capital ratios as of December 31, 2014 are calculated under U.S. Basel I rules. The capital ratios displayed as of March 31, 2015, September 30, 2014, June 30, 2014, and March 31, 2014 are calculated in accordance with the transition guidelines set forth in the U.S. federal banking agencies' revised capital framework for implementing the final U.S. Basel III regulatory capital rules.

(11)

The tangible common equity ratio, a non-GAAP financial measure, is calculated as tangible common equity divided by tangible assets. The methodology for determining tangible common equity may differ among companies. The tangible common equity ratio facilitates the understanding of the Company's capital structure and is used to assess and compare the quality and composition of the Company's capital structure to other financial institutions. Please refer to Exhibit 11 for a reconciliation between certain GAAP amounts and these non-GAAP measures.

(12)

The Tier 1 common capital ratio is the ratio of Tier 1 capital, less qualifying trust preferred securities, to risk-weighted assets. The Tier 1 common capital ratio, a non-GAAP financial measure, facilitates the understanding of the Company's capital structure and may be used to assess and compare the quality and composition of the Company's capital structure to other financial institutions. Please refer to Exhibit 11 for a reconciliation between certain GAAP amounts and these non-GAAP measures.

(13)

In December 2014, the Federal Reserve Board approved the Company's request to opt-out of the advanced approaches methodology under U.S. Basel III regulatory capital rules. Common Equity Tier 1 risk-based capital is calculated in accordance with the transition guidelines set forth in the U.S. federal banking agencies' revised capital framework for implementing the final U.S. Basel III regulatory capital rules. Management reviews this ratio, which excludes accumulated other comprehensive loss, along with other measures of capital as part of its financial analyses.

(14)

Common Equity Tier 1 risk-based capital (standardized, fully phased-in basis) is a non-GAAP financial measure that is used by investors, analysts and bank regulatory agencies to assess the capital position of financial services companies as if the transition provisions of the U.S. Basel III rules were fully phased in for the periods in which the ratio is disclosed. Management reviews this ratio, which excludes accumulated other comprehensive loss, along with other measures of capital as part of its financial analyses and has included this non-GAAP information, and the corresponding reconciliation from Common Equity Tier 1 capital under U.S. Basel III (standardized transitional) because of current interest in such information by market participants. Please refer to Exhibit 11 for a reconciliation between certain GAAP amounts and these non-GAAP measures.


(15)	Criticized loans held for investment reflects loans in the commercial portfolio segment that are monitored for credit quality based on internal ratings. Amounts exclude small business loans, which are monitored by business credit score and delinquency status.


(16)	The allowance for credit losses ratios include the allowances for loan losses and losses on unfunded credit commitments against end of period total loans held for investment or total nonaccrual loans, as appropriate.


(17)	Fees from affiliates represent income resulting from the July 1, 2014 business integration initiative.


(18)	Average balances on loans held for investment include all nonperforming loans. The amortized portion of net loan origination fees (costs) is included in interest income on loans, representing an adjustment to the yield.


(19)	Includes noninterest bearing trading assets.


(20)	Includes interest bearing trading liabilities.


(21)	Includes noninterest bearing trading liabilities.

(22)

Excludes loans totaling $52 million, $65 million, $103 million, $123 million, and $124 million that are 90 days or more past due and still accruing at March 31, 2015, December 31, 2014, September 30, 2014, June 30, 2014, and March 31, 2014, respectively, which consist of loans accounted for within loan pools in accordance with the accounting standards for purchased credit-impaired loans. The past due status of individual loans within the pools is not a meaningful indicator of credit quality, as potential credit losses are measured at the loan pool level.


(23)	Carrying amount reflects amortized cost except for balances transferred from available for sale to held to maturity securities. Those balances reflect amortized cost plus any unrealized gains or losses at the date of transfer.

nm = not meaningful

n/a = not applicable



	Exhibit 12

MUFG Americas Holdings Corp - FORM 8-K - EX-99.2 - EXHIBIT 99.2 - April 27, 2015

Attached files

MUFG Americas Holdings Corp Reports