SunTrust Banks, Inc. James M. Wells III President and Chief Operating Officer

Transcription

1 SunTrust Banks, Inc. James M. Wells III President and Chief Operating Officer

2 The following should be read in conjunction with the financial statements, notes and other information contained in the Company s Quarterly Report for the period ended March 31, 2006 on Form 10-Q and the 2005 Annual Report on Form 10-K. This presentation includes non-gaap financial measures to describe SunTrust s performance. The reconciliation of those measures to GAAP measures can be found in the appendix of this presentation, as well as in SunTrust s earnings press releases, which can be found on SunTrust s website in the news section of the investor relations pages. In this presentation, net interest income, net interest margin and the efficiency ratio are presented on a fully taxable-equivalent ( FTE ) basis, and ratios are presented on an annualized basis. The FTE basis adjusts for the tax-favored status of income from certain loans and investments. The Company believes this measure to be the preferred industry measurement of net interest income and provides relevant comparison between taxable and non-taxable amounts. This presentation contains forward-looking statements (within the meaning of the Private Securities Litigation Reform Act of 1995) which involve significant risks and uncertainties, and investors are cautioned against placing undue reliance on management s expectations. The forward-looking statements are intended to be subject to the safe harbor protection provided by Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of Forward-looking statements include statements preceded by, followed by or that include the words intends, believes, expects, anticipates, plans, estimates, goals, strategies, initiatives, opportunities, or similar expressions or future conditional verbs such as will, should, would, and could. Actual results could differ materially from those contained in or implied by such statements for a variety of reasons including, but not limited to: changes in interest rates; changes in general business or economic conditions or the competitive banking environment; changes in credit conditions including customers ability to repay debt obligations; competitive pressures among local, regional, national, and international banks, thrifts credit unions, and other financial institutions; increases in the cost of funds resulting from customers pursuing alternatives to bank deposits or shifting from demand deposits to higher-cost products; significant changes in legislation or regulatory requirements, or the fiscal and monetary policies of the federal government and its agencies; significant changes in securities markets or markets for commercial or residential real estate; the Company s success in managing its costs, including costs associated with the expansion of distribution channels and developing new ones; the potential that the Company may acquire other institutions or may be acquired by other institutions; the potential that the Company may divest certain portions of its business; hurricanes and other natural disasters; litigation; and changes in accounting principles, policies, or guidelines. These factors and others are described in the Company s Annual Report on Form 10-K under the heading Risk Factors, as supplemented by the Company s Quarterly Report on Form 10-Q. The forward-looking statements in this presentation speak only as of the date of this presentation, and SunTrust does not undertake to update any forward-looking statement to reflect circumstances or events that occur after the statement is made. 0 1

3 LOB and Geographic Overview Lines of Business Five Business Lines Retail Wealth and Investment Management Commercial Mortgage Corporate and Investment Banking Geographies Four Groups Central Florida Mid-Atlantic Carolinas 20 Regions with a Local Executive and Dedicated Management Team 50+ Local Banking Markets Drive Strategy, Initiatives, Installation and Profitability Drive Client Acquisition, Expansion, Service, Retention and Profitability 18 18

4 Geographic Structure 4 Groups 20 Regions Mid-Atlantic Carolinas Central Florida 1,332 Traditional branches 345 In-store branches 2,786 ATMs Central Florida Mid-Atlantic Carolinas Atlanta Chattanooga East Tennessee - Knoxville Georgia Savannah/South Georgia Memphis Nashville Central - Orlando South FL - Fort Lauderdale/Miami Southwest FL - Ft Myers/Sarasota/Naples North FL - Jacksonville/Pensacola Tampa Bay Central Virginia - Richmond Maryland - Baltimore Greater Washington Western Virginia - Roanoke Hampton Roads - Norfolk Triangle- Raleigh/Durham, Wilmington Mecklenburg Asheville, Charlotte South Carolina Greenville, Charleston Triad Greensboro, Winston-Salem 19 19

5 Central Group Overview 523 branches, 818 ATMs $37.9 billion in deposits; 19.0% deposit market share in GA; #1 rank in state; 10.1% deposit market share in TN; #3 in state 1 Nashville East Tennessee Client relationships: 1.2 million personal, 155,000 business clients Household penetration: 25% 2 14% of Business Banking market considers SunTrust the lead bank SunTrust has a relationship with 21% of the market (tied for #1 in Central) 3 Memphis Chattanooga Atlanta Georgia 23% of Commercial Banking market considers SunTrust the lead bank SunTrust has a relationship with 36% of the market (#1 in Central) 4 1 Source: As of June 2005, FDIC, state numbers are based on political boundaries. 2 Source: Claritas and MCIF, March Source: Independent third party research, Source: Independent third party research,

6 Florida Group Overview 498 branches, 941 ATMs $34.3 billion in deposits; 10.0% deposit market share in FL; #3 rank in state 1 Client Relationships: 1.4 million personal, 196,500 business clients Household penetration: 19% 2 10% of Business Banking market considers SunTrust the lead bank SunTrust has a relationship with 16% of the market (#3 in Florida) 3 17% of Commercial Banking market considers SunTrust the lead bank SunTrust has a relationship with 23% of the market (#3 in Florida) 4 North Florida Tampa Bay Southwest Florida Central Florida South Florida 1 Source: As of June 2005, FDIC, state numbers are based on political boundaries. 2 Source: Claritas and MCIF, March Source: Independent third party research, Source: Independent third party research,

7 Mid-Atlantic Group Overview 413 Branches, 752 ATMs $23.6 billion in deposits; 9.2% deposit market share; #4 in footprint 1 Client relationships: 1.6 million personal, 128,500 business clients Western Virginia GWR Maryland Household penetration: 30% 2 12% of Business Banking market considers SunTrust the lead bank SunTrust has a relationship with 18% of the market (#4 in Mid-Atlantic) 3 18% of Commercial Banking market considers SunTrust the lead bank SunTrust has a relationship with 24% of the market (#3 in Mid-Atlantic) 4 Central Virginia Hampton Roads 1 Source: As of June 2005, FDIC, state numbers are based on political boundaries. 2 Source: Claritas and MCIF, March Source: Independent third party research, Source: Independent third party research,

8 Carolinas Group Overview 243 branches, 275 ATMs $9.2 billion in deposits; 4.2% deposit market share in NC; #5 rank in state; 2.8% deposit market share in SC; #8 in state 1 Mecklenburg Triad Client relationships: 506,000 personal, 83,500 business clients Triangle Household penetration: 16% 2 9% of Business Banking market considers SunTrust the lead bank SunTrust has a relationship with 15% of the market (#4 in Carolinas) 3 4% of Commercial Banking market considers SunTrust the lead bank SunTrust has a relationship with 8% of the market (#6 in Carolinas) 4 South Carolina 1 Source: As of June 2005, FDIC, state numbers are based on political boundaries. 2 Source: Claritas and MCIF, March Source: Independent third party research, Source: Independent third party research,

9 Retail Contribution (1Q 2006) Revenue $850.7 million Net Income $190.5 million 41% 36% Loans $31.2 billion Deposits $67.2 billion 27% 56% Retail Other LOBs 24 24

10 Retail s Lines of Business Work Well Together Branch Banking Business Banking Consumer Lending New Consumer Deposit Sales Production (in millions) New Business Deposit Sales Production (in millions) Home Equity Sales Production (in millions) $5,000 $4,000 $3,000 35% $1,600 $1,400 $1,200 $1,000 47% $3,000 $2,500 $2,000 36% $2,000 $1,000 $0 1Q Q 2006 $800 $600 $400 $200 $0 1Q Q 2006 $1,500 $1,000 $500 $0 1Q Q

11 Retail Landscape SunTrust serves more than 4 million personal households and 500,000 small businesses SunTrust has the 3 rd largest branch network in the Southeast 1,677 full service banking offices 1,332 traditional branches 345 in-store locations 2,786 ATMs SunTrust ranks #3 in deposit market share in the Southeast In 2005, the SunTrust footprint includes 19 million (17%) out of the 111 million U.S. Households SunTrust provides services to 23% of the 19 million households in the footprint Note: As of 03/31/2006 SunTrust MCIF

12 Deposit Market Share SunTrust has a top 5 deposit market share in 19 out of 20 of our Regions, and top 3 in 15 Regions Our future strategies are designed to capture high deposit growth in opportunistic locations Rank in SunTrust Region Deposits 1 Atlanta 1 Chattanooga 1 Nashville 1 Triangle 2 Central Florida 3 East Tennessee 3 Georgia 3 Greater Washington 3 Memphis 3 North Florida 3 South Florida 3 Southwest Florida 3 Tampa 3 Triad 3 Western Virginia 3 Central Virginia 4 Hampton Roads 4 Mecklenburg 5 South Carolina 5 Maryland 7 1 Source: June 2005 SNL and FDIC Deposit Data, please note the FDIC data includes headquarter deposits in certain regions

13 Wealth and Investment Management Contribution (1Q 2006) Revenue $331.2 million Net Income $45.7 million 16% 9% Loans $8.1 billion 7% Deposits $9.2 billion 8% W&IM Other LOBs 28 28

14 Wealth and Investment Management Overview Wealth and Investment Management Private Wealth Management Institutional Investment Management Private Wealth Management SunTrust Investment Svcs Personal Asset Management Corporate Trust Retirement Services Sports & Entertainment International Wealth Management Endowment & Foundation Medical & Legal 29 29

15 Private Wealth Management Capabilities Credit Jumbo Mortgage Home Equity Line Lines of Credit Letters of Credit Swing Loans Risk Management Collars Prepaid Forwards Covered Calls Personal Insurance Life Insurance Products Wealth Transfer Long-Term Care Investment Management Portfolio Management for Equity Fixed Income Alternative Investments and Multi- Managers Stock Option Alternatives Client Trust and Estate Administration Revocable and Irrevocable Trusts Estate Planning Estate Settlement Custodial Services Delaware Trust Company Offshore Trusts Real Estate and Special Asset Personal and Commercial Real Estate Property Timber Management Closely-Held Business Valuations 1031 Exchanges Online Banking Portfolio View Online Statements Custom File Delivery Online Investing Financial Planning Estate Tax Minimization Income Tax Strategies Probate Avoidance 30 30

16 Creating Solutions Tailored for Institutions Fixed Income Liquidity & Short-Term Fixed Tax-Free Fixed High-Grade Taxable Fixed High-Yield Fixed Floating-Rate Bank Loans Equity Management Value Equity: Large, Mid and Small Cap Growth Equity: Large, Mid and Small Cap International Equity Aggressive Growth Equity: Large Cap and SMID STI Classic Funds Over $35B in AUM as of 4/30/06 6th largest bank-sponsored fund complex as of 12/31/05 Comprised of 61 funds Independent board of trustees Institutions Strategic Allocation Solutions Open Architecture Investments Client Needs Assessment Investment Policy Development Manager Due Diligence Portfolio Construction Reporting & Account Servicing Endowment & Foundation Planned Giving Grant Tracking and Grant Administration Custody & Master Custody Customized Investment Management choices for charitable assets and trusts Corporate Trust Bond Indenture Trustee Escrow Services 1031 Exchange Agent Retirement Services Defined Benefit (DB) Plans Defined Contribution (DC) Plans Rollover Solutions Advice/Managed Account Custody Services 31 31

17 Commercial Contribution (1Q 2006) Revenue $300.7 million Net Income $106.8 million 15% 20% Loans $31.5 billion Deposits $13.7 billion 27% 11% Commercial Other LOBs 32 32

18 Commercial Line of Business Overview Core Commercial Diversified Commercial Banking ($5MM-$50MM) Middle Market Banking ($50MM-$250MM) Auto Dealer Financing Institutional & Government Banking Community Banking Commercial Real Estate Real Estate Finance Group National Homebuilders REITs Commercial Mortgage Finance Group Affordable Housing/CDC Treasury Management Services Treasury Management Sales (Corporate Banking, Commercial Banking, and Business & Professionals) Commercial Card Sales Treasury Management Client Services Trustee Management Group Premium Assignment Corporation Commercial Insurance Premium Finance Branch offices in Atlanta, Chicago, Houston, Newark, Los Angeles, Miami and Tampa 33 33

19 Mortgage Contribution (1Q 2006) Revenue $268.8 million Net Income $79.7 million 13% 15% Loans $28.9 billion Deposits $1.4 billion 25% 1% Mortgage Other LOBs 34 34

20 Mortgage LOB Retail Geographic Locations 176 Mortgage Offices 1,540 Loan Officers 23 locations outside of the Company s footprint Opened 63 new Mortgage Retail offices since 12/31/04 43 locations in Central Group 57 locations in Mid-Atlantic Group 16 locations in Carolinas Group 37 locations in Florida Group Source: STM Branch Listing, March,

21 Mortgage LOB Wholesale Geographic Locations Seattle, WA Portland, OR Portsmouth, NH San Ramon, CA Denver, CO Chicago, IL Cleveland, OH Kansas City, KS Richmond, VA Laguna Hills, CA Phoenix, AZ Tucson, AZ Dallas, TX Nashville, TN Atlanta, GA Charlotte, NC Houston, TX Tampa, FL Orlando, FL Maitland, FL 20 Regional Operations Centers 169 Account Executives Opened 4 new Wholesale offices since 12/31/04 Source: STM Branch Listing, March,

22 Mortgage LOB Correspondent Geographic Locations Vancouver, WA Omaha, NE Palmyra, WI Canton, MI Chicago, IL Holley, NY Northborough, MA Boston, MA Westhampton,NJ Santa Cruz, CA Las Vegas, NV Carlsbad, CA Centennial, CO Tulsa, OK Franklin, TN National Operations Center Richmond, VA Mooresville, NC Charlotte, NC Plano, TX Dora, AL Grand Prairie, TX Houston, TX Jacksonville, FL Mirimar, FL 24 Account Executives / Sales Offices Operations in Richmond Headquarters Opened 2 new Correspondent offices since 12/31/04 Source: STM Branch Listing, March,

23 SunTrust Mortgage Portfolio Total Loan Portfolio: $28.9 Billion Primarily invests in Prime and Alt-A Hybrid ARMs and Second Mortgages No negative-amortizing mortgages No Option ARMs No sub-prime mortgages 82% 4% 4% 8% 2% Selectively transfer credit risk to other investors Prime Hybrid ARMS Construction Perm Fixed Rate Alt A Hybrid ARMS 2nd Mortgages Note: Average for 1Q

24 Corporate and Investment Banking Contribution (1Q 2006) Revenue $225.4 million Net Income $64.2 million 11% 12% Loans $16.1 billion Deposits $3.7 billion 14% 3% CIB Other LOBs 39 39

25 Corporate and Investment Banking Overview Capital Markets Investment Banking: provides loan syndication, public and private debt underwriting, structured real estate services, asset securitization/principal investing; public and private equity underwriting, and mergers and acquisition advisory services Sales & Trading: provides debt and equity trading/distribution and equity securities research Derivatives: provides risk management solutions for customers using interest rate and equity derivatives and foreign exchange Merchant Banking: private equity and mezzanine investing Clients: include Large Corporate, Financial Services, Commercial, Wealth & Investment Management, Retail, Institutional Investors and SunTrust Credit Products Provides credit and lending services for our Large Corporate clients (revenue > $250 Million) and Financial Institutions of all sizes Leasing Provides equipment leasing needs to businesses of all sizes. Clients also include U.S. federal, state and local municipalities and not-for-profit organizations Treasury Management Provides cash management, bankcard and trade solutions to Large Corporate and Financial Institution clients 40 40

26 Common Themes Across LOBs Enhancing the client experience through improved service and specialized products Optimizing distribution capabilities and further integrating client access and delivery across LOBs Effectively leveraging our best-in-class sales force to foster full relationship management and improve retention Improving efficiency through streamlined processes and operations Expanding capability and products to capture opportunity in emerging markets and high opportunity segments Retaining key salespeople, adding resources in markets with highest opportunities and strengthening performance management practices Superior execution by the geography and specialty teams in our high opportunity footprint Improving loan spreads through focus on risk-adjusted pricing discipline Building capabilities and products to capture Retirement opportunity across the business lines 41 41

27 Long-Term Growth Initiatives Long-Term Annual Growth Rate Goals Excluding Capital Management Opportunities Business Line Retail Wealth and Investment Management Commercial Mortgage Corporate and Investment Banking SunTrust Long-Term Annual Growth Rate Goal % 12-14% 8-10% 10-12% 9-11% 9-11% 1 Actual results could differ. Please see slide 1 for a list of important factors that could cause actual results to differ