L. Phillip Humann Chairman, President and CEO. Goldman Sachs 15th Annual Bank CEO Conference

Transcription

1 L. Phillip Humann Chairman, President and CEO Goldman Sachs 15th Annual Bank CEO Conference December 2004

2 This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of Such statements include, but are not limited to, statements about the benefits of the merger between SunTrust Banks, Inc. ( SunTrust ) and National Commerce Financial Corporation ( NCF ), including future financial and operating results, SunTrust s plans, objectives, expectations and intentions and other statements that are not historical facts. Such statements are based upon the current beliefs and expectations of SunTrust s and NCF s management and are subject to significant risks and uncertainties. Actual results may differ from those set forth in the forward-looking statements. The following factors, among others, could cause actual results to differ from those set forth in the forward-looking statements: the risk that the cost savings and any revenue synergies from the merger may not be fully realized or may take longer to realize than expected; disruption from the merger making it more difficult to maintain relationships with clients, employees or suppliers; increased competition and its effects on pricing, spending, third-party relationships and revenues; and the risk of new and changing regulation in the U.S. and internationally. Additional factors that could cause SunTrust s and NCF s results to differ materially from those described in the forwardlooking statements can be found in the 2003 Annual Reports on Form 10-K of SunTrust and NCF, and in the Quarterly Reports on Form 10-Q and 10-Q/A of SunTrust and NCF filed with the Securities and Exchange Commission and available at the Securities and Exchange Commission s internet site ( The forward-looking statements in this presentation speak only as of the date of the filing, and SunTrust does not assume any obligation to update the forward-looking statements or to update the reasons why actual results could differ from those contained in the forward-looking statements. This presentation could include some non-gaap measures to describe SunTrust s performance. The reconciliation of those measures to GAAP measures can be found in SunTrust s earnings press release, on SunTrust s website in the press release section of the Investor Relations pages and in the appendix of this presentation.

3 Potential High growth geographic footprint Distinctive operating model Sales and revenue focus Investments for the future Performance Revenue and earnings momentum Industry-leading credit quality Strong LOB & sales results -1-

4 Best Footprint in Banking Highest growth markets for Top 20 banks; 61% better than the national average* Top 5 rank in 20 of 25 largest high growth markets in Southeast #3 in market share in Southeast Projected Weighted Average Population Growth* 8.7% SunTrust 5.3% National Average *Top 20 U.S. banks and thrifts by market cap as of July 16, Weighted average based on MSA deposits. Source: SNL Financial Distinctive Operating Model Deliver big bank capabilities with local decisions and responsiveness Decisions close to customer True client management Ability to serve all segments -2-

5 Developing Capabilities Streamlined administrative structure and implemented series of operational initiatives Introduced new geographic structure and operating model Focused on efficiency, ability to deliver common customer experience Strategic Focus 2004 and beyond Placing highest priority on sales and client retention Aligning top talent to key leadership positions Implementing new LOB revenue initiatives -3-

6 RETAIL Potential Introduce enhanced consumer and business banking product sets Doubled net new checking account acquisition rate YTD over 2003 level. Equity product volumes 20% higher than same period in 2003 Focus on high growth business banking segment Positive business banking trends (as of July 31, 2004) Checking balances up 12% over 2003 Loan production up 9% over 2003 Continue to grow branch network over next three years in high-growth markets Denovo growth of 45 net new locations by year end 2004 NCF merger deepens branch share in high opportunity markets, adds over 250 branches in the Performance Carolinas 3Q 2004:3Q 2003 $ Growth* % Growth Deposit Growth $1,866,870 4% Long Term Growth Rate Target: 8 10% Loan Growth 2,898,414 12% Net Income Growth 35,709 11% * Deposit and loan growth based on average balances for the quarter, in thousands -4-

7 COMMERCIAL Potential Enhance Treasury Services technology platform to satisfy customer and competitive demands Introduced product additions and enhancements critical to client cash management needs Purchasing Card payment manager Web-based foreign exchange trading Payroll card Online report delivery Leverage new pricing tools with the relationship profitability component Installed several upgrades to improve pricing position Enhanced model to maximize economic profit Converted all commercial relationships to common profitability management system Established pricing governance process Performance 3Q 2004:3Q 2003 $ Growth* % Growth Deposit Growth $1,517,520 14% Long Term Growth Rate Target: 8 10% Loan Growth 1,081,472 5% Net Income Growth (6,744) (4)% * Deposit and loan growth based on average balances for the quarter, in thousands -5-

8 TRANSLATING POTENTIAL INTO PERFOMANCE CORPORATE AND INVESTMENT BANKING Potential Further develop equity and debt capital market products to sustain competitive market positions Leveraging CIB product skills across LOBs Equity Linked CDs (SLICs) sold to PCS client base CMBS partnership with Commercial Real Estate Risk management partnership on Credit Default Swaps and Secondary Loan Trading Focus on upper middle and large corporate markets with low risk profile Expanding Corporate Banking client penetration faster than any other bank Completed 90% of annual client plans in Q1, focusing on cross-sell goals and retention Performance 3Q 2004:3Q 2003 $ Growth* % Growth Deposit Growth $271,786 9% Long Term Growth Rate Target: 9 11% Loan Growth (3,487,340) (21)% Net Income Growth 42,418 43% * Deposit and loan growth based on average balances for the quarter, in thousands -6-

9 PRIVATE CLIENT SERVICES Potential Buy, build, or partner to offer a complete product set to satisfy market demands Retail Investment Income up 20% over last year Opened new AMA office in Charlotte, Miami, Atlanta and Memphis; Increased AMA AUM to $8.465 billion, up 150% Completed acquisition of Seix Investment Advisors ($17 Billion in new assets) Developed and implemented new Flexible Architecture process for institutional clients. Develop comprehensive package of insurance products and services Implemented a comprehensive program targeted at wealthy and affluent clients Launched an entire array of insurance services including: Term, UL, VUL, Survivorship, Wealth Transfer products; Long-term care products; Disability products; and Annuities Insurance sales up 244% over last year Performance 3Q 2004:3Q 2003 $ Growth* % Growth Deposit Growth $542,210 36% Long Term Growth Rate Target: 12 14% Loan Growth 225,508 11% Net Income Growth 11,036 25% * Deposit and loan growth based on average balances for the quarter, in thousands -7-

10 MORTGAGE Potential Expand Retail, Broker, and Correspondent channels while enhancing Consumer Direct 113 net new retail loan offices (155% of YTD goal) 425 net new broker and correspondent relationships (177% of YTD goal) $2.1B bank referred production (162% of YTD goal) Launch out of footprint sales of mortgage and home equity Significantly ramped up out of footprint sales force Successful with the home equity product in the markets it has been rolled out in within the Retail channels; major roll-out expected by year end. Performance 3Q 2004:3Q 2003 $ Growth* % Growth Deposit Growth $(851,932) (39)% Long Term Growth Rate Target: 8 10% Loan Growth 5,309,521 40% Net Income Growth (11,012) (15)% * Deposit and loan growth based on average balances for the quarter, in thousands -8-

11 RECAP Business Line Long Term Growth Rate Target Retail 8-10% Commercial Corporate and Investment Banking 8-10% 9-11% Private Client Services 12-14% Mortgage 8-10% SunTrust 8-10% -9-

12 APPENDIX

13 APPENDIX (Dollars in thousands) Average Deposits 3Q Q 2003 $ Change 3Q 04 vs 3Q 03 % Change 3Q 04 vs 3Q 03 Retail $55,069,808 $53,202,938 $1,866,870 4% Commercial 12,299,813 10,782,293 1,517,520 14% Corporate and Investment Banking 3,240,545 2,968, ,786 9% Private Client Services 2,068,724 1,526, ,210 36% Mortgage 1,358,824 2,210,756 (851,932) (39)% Average Loans Retail $ 26,820,343 $23,921,929 2,898,414 12% Commercial 22,677,373 21,595,901 1,081,472 5% Corporate and Investment Banking 13,072,723 16,560,063 (3,487,340) (21)% Private Client Services 2,342,973 2,117, ,508 11% Mortgage 18,699,549 13,390,028 5,309,521 40%

14 APPENDIX (Dollars in thousands) Three Months Ended September 30, 2004 Net Interest Income (FTE) Retail $470,937 Commercial $180,168 Corp. and Investment Banking $66,241 Mortgage $121,022 Private Client Services $14,707 Provision for loan losses 29,143 11,531 8, Net interest income after provision for loan losses 441, ,637 57, ,374 14,254 Noninterest Income 207,196 80, ,646 28, ,722 Noninterest Expense 287,566 95,815 76,188 85, ,760 Net Income 361, , ,132 63,843 55,216

15 APPENDIX (Dollars in thousands) Three Months Ended September 30, 2003 Retail Commercial Corp. and Investment Banking Mortgage Private Client Services Net Interest Income (FTE) $444,280 $165,451 $74,678 $168,002 $13,602 Provision for loan losses 41,917 4,653 31, Net interest income after provision for loan losses 402, ,798 43, ,279 12,928 Noninterest Income 193,693 83, ,244 (11,917) 167,050 Noninterest Expense 270,341 84,120 80,006 80, ,798 Net Income 325, ,829 97,714 74,855 44,180