| Filed by Wachovia Corporation pursuant to Rule 425 under the Securities Act of 1933, as amended, and deemed filed pursuant to Rule 14a-12 under the Securities Exchange Act of 1934, as amended | ||
| Subject Company: SouthTrust Corporation | ||
| Commission File No.: 0-3613 | ||
| Date: June 21, 2004 | ||
This filing contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, with respect to each of Wachovia Corporation, SouthTrust Corporation and the combined company following the proposed merger between Wachovia and SouthTrust, as well as the goals, plans, objectives, intentions, expectations, financial condition, results of operations, future performance and business of Wachovia, including, without limitation, (i) statements relating to the benefits of the merger, including future financial and operating results, cost savings, enhanced revenues and the accretion to reported earnings that may be realized from the merger, (ii) statements relating to the benefits of the retail securities brokerage combination transaction between Wachovia and Prudential Financial, Inc. completed on July 1, 2003, including future financial and operating results, cost savings, enhanced revenues and the accretion of reported earnings that may be realized from the brokerage transaction, (iii) statements regarding certain of Wachovia’s and/or SouthTrust’s goals and expectations with respect to earnings, earnings per share, revenue, expenses and the growth rate in such items, as well as other measures of economic performance, including statements relating to estimates of credit quality trends, and (iv) statements preceded by, followed by or that include the words “may”, “could”, “should”, “would”, “believe”, “anticipate”, “estimate”, “expect”, “intend”, “plan”, “projects”, “outlook” or similar expressions. These statements are based upon the current beliefs and expectations of Wachovia’s management and are subject to significant risks and uncertainties. Actual results may differ from those set forth in the forward-looking statements. These forward-looking statements involve certain risks and uncertainties that are subject to change based on various factors (many of which are beyond Wachovia’s control).
The following factors, among others, could cause Wachovia’s or SouthTrust’s financial performance to differ materially from that expressed in such forward-looking statements: (1) the risk that the businesses of Wachovia and SouthTrust in connection with the merger or the businesses of Wachovia and Prudential in the brokerage transaction will not be integrated successfully or such integration may be more difficult, time-consuming or costly than expected; (2) expected revenue synergies and cost savings from the merger or the brokerage transaction may not be fully realized or realized within the expected time frame; (3) revenues following the merger or the brokerage transaction may be lower than expected; (4) deposit attrition, operating costs, customer loss and business disruption
following the merger or the brokerage transaction, including, without limitation, difficulties in maintaining relationships with employees, may be greater than expected; (5) the ability to obtain governmental approvals of the merger on the proposed terms and schedule; (6) the failure of Wachovia’s and SouthTrust’s shareholders to approve the merger; (7) the strength of the United States economy in general and the strength of the local economies in which Wachovia and/or SouthTrust conducts operations may be different than expected resulting in, among other things, a deterioration in credit quality or a reduced demand for credit, including the resultant effect on Wachovia’s and/or SouthTrust’s loan portfolio and allowance for loan losses; (8) the effects of, and changes in, trade, monetary and fiscal policies and laws, including interest rate policies of the Board of Governors of the Federal Reserve System; (9) inflation, interest rate, market and monetary fluctuations; and (10) adverse conditions in the stock market, the public debt market and other capital markets (including changes in interest rate conditions) and the impact of such conditions on Wachovia’s capital markets and capital management activities, including, without limitation, Wachovia’s mergers and acquisition advisory business, equity and debt underwriting activities, private equity investment activities, derivative securities activities, investment and wealth management advisory businesses, and brokerage activities. Additional factors that could cause Wachovia’s and SouthTrust’s results to differ materially from those described in the forward-looking statements can be found in Wachovia’s and SouthTrust’s Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K filed with the SEC. All subsequent written and oral forward-looking statements concerning Wachovia or the proposed merger or other matters and attributable to Wachovia or any person acting on its behalf are expressly qualified in their entirety by the cautionary statements above. Wachovia and SouthTrust do not undertake any obligation to update any forward-looking statement, whether written or oral, relating to the matters discussed in this filing.
The proposed merger will be submitted to Wachovia’s and SouthTrust’s shareholders for their consideration, and Wachovia and SouthTrust will file a registration statement, a joint proxy statement/prospectus and other relevant documents concerning the proposed merger with the SEC. Shareholders are urged to read the registration statement and the joint proxy statement/prospectus regarding the proposed merger when it becomes available and any other relevant documents filed with the SEC, as well as any amendments or supplements to those documents, because they will contain important information. You will be able to obtain a free copy of the joint proxy statement/prospectus, as well as other filings containing information about Wachovia and SouthTrust, at the SEC’s Internet site (http://www.sec.gov). You will also be able to obtain these documents, free of charge, at www.wachovia.com under the tab “Inside Wachovia – Investor Relations” and then under the heading “Financial Reports—SEC Filings”. You may also obtain these documents, free of charge, at www.southtrust.com under the tab “About SouthTrust”, then under “Investor Relations” and then under “SEC Documents”. Copies of the joint proxy statement/prospectus and the SEC filings that will be incorporated by reference in the joint proxy statement/prospectus can also be obtained, without charge, by directing a request to Wachovia Corporation, Investor Relations, One Wachovia Center, 301 South College Street, Charlotte, NC 28288-0206, (704)-374-6782, or to SouthTrust Corporation, P. O. Box 2554, Birmingham, AL 35290, (205)-254-5187.
Wachovia and SouthTrust, and their respective directors and executive officers, may be deemed to be participants in the solicitation of proxies from the shareholders of Wachovia and SouthTrust in connection with the proposed merger. Information about the directors and executive officers of Wachovia and their ownership of Wachovia common stock is set forth in the proxy statement, dated March 15, 2004, for Wachovia’s 2004 annual meeting of shareholders, as filed with the SEC on a Schedule 14A. Information about the directors and executive officers of SouthTrust and their ownership of SouthTrust common stock is set forth in the proxy statement, dated March 8, 2004, for SouthTrust’s 2004 annual meeting of shareholders, as filed with the SEC on a Schedule 14A. Additional information regarding the interests of those participants and other persons who may be deemed participants in the transaction may be obtained by reading the joint proxy statement/prospectus regarding the proposed merger when it becomes available. You may obtain free copies of these documents as described in the preceding paragraph.
THE FOLLOWING IS A JOINT PRESS RELEASE ISSUED BY WACHOVIA AND SOUTHTRUST ON JUNE 21, 2004
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Press Release June 21, 2004
WACHOVIA AND SOUTHTRUST TO MERGE IN STOCK-FOR-STOCK TRANSACTION
Accelerating Momentum in High-Growth Southern U.S.
CHARLOTTE, N.C. AND BIRMINGHAM, ALA. – Wachovia Corporation (NYSE: WB) and SouthTrust Corporation (NASDAQ: SOTR) announced today they have signed a definitive merger agreement that will create an unmatched franchise in their high-growth Southeastern footprint and accelerate Wachovia’s planned expansion into Texas.
With this merger, Wachovia will offer 14 million households and businesses in 15 states and Washington, D.C., its premier selection of financial services and products delivered through multiple distribution channels. The combination creates the number 1 bank in the Southeast, with 18 percent deposit share, and provides immediate scale in the fast-growing Texas market. The earnings contribution generated by its high-performing banking and retail securities businesses would increase to 75 percent of Wachovia’s total earnings, based on March 31, 2004, pro forma earnings. With combined assets of $464 billion and combined market capitalization of $76 billion, the financial holding company is the nation’s fourth largest based on assets.
“This transaction gives us clear leadership in a number of attractive, high-growth states, and extends our reach into new southeastern and southwestern states,” said Ken Thompson, Wachovia’s chairman, president and CEO. “It is also financially attractive for both sets of shareholders. It meets Wachovia’s investment return guidelines, while improving the long-term growth prospects for both companies.
“SouthTrust is one of the nation’s best performing, highest quality regional banks. Wachovia and SouthTrust have proven leadership in sales and customer service, as well as expertise in successful merger integration. Both companies are committed to excellence in customer service. We’re excited about what we can do for our customers, communities, employees and shareholders as we join forces,” Thompson said. “We’ll continue the long tradition Wachovia and SouthTrust have of commitment to community through strengthening neighborhoods and leadership in education. We expect to announce a specific community plan within the next several weeks.”
Wachovia has agreed to exchange 0.89 shares of its common stock for each share of SouthTrust common stock. Based on Wachovia’s closing stock price of $47.00 on June 18, 2004, the transaction would be valued at $14.3 billion and represent an exchange value of $41.83 for each share of SouthTrust common stock. It is expected to be accretive to cash earnings per share within 24 months and to operating earnings per share within 30 months, and is expected to provide an internal rate of return (IRR) of 16 percent. Cash earnings are earnings before merger-related and restructuring expenses, intangible amortization and preferred dividends. Operating earnings are earnings before merger-related and restructuring expenses and preferred dividends.
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The companies expect the transaction to generate $255 million in annual after-tax expense reductions after a 15-month integration period following completion of the merger. These savings equal 3 percent of the companies’ current combined annualized expense base, or 36 percent of SouthTrust expenses. The companies expect one-time costs, including merger-related and restructuring charges and exit cost purchase accounting adjustments, of $431 million after tax over the integration period, and they estimate that less than $1 billion in deposits would be divested as a condition of regulatory approval.
In addition, Wachovia said it expects to repurchase shares of its common stock in the open market before beginning the proxy solicitation in connection with the shareholder vote on the transaction, and after the vote. Following consummation of the merger, Wachovia expects an additional $1.7 billion of excess capital will be available from the combined company, which Wachovia anticipates using to make incremental share repurchases. The timing and nature of these repurchases will depend on market conditions and applicable securities laws.
The complementary strengths of the two companies are expected to generate significant revenue opportunities, although these expectations are not included in the financial assumptions for the transaction.
“This combination offers something rare. Our goal is for all of our stakeholders to benefit from the expanded resources and broad product set of Wachovia – a big company that takes pride in not acting like one,” said Wallace Malone, chairman and CEO of SouthTrust. “We share the same core values and the same passion about serving our customers, improving our communities, providing meaningful work for our employees and building enduring value for shareholders.
“We have watched carefully as Wachovia completed its recent merger while continuing to improve the customer experience and generating strong earnings growth. Our merger integration timeline and focus on retaining customers is modeled on the Wachovia-First Union model, which we believe is the best in the industry,” Malone added. He will serve as Wachovia’s vice chairman following the completion of the merger.
David M. Carroll, Wachovia senior executive vice president, and Frank Schmidt, SouthTrust Bank vice chairman, will co-lead the integration of the two companies. “We’re eager to leverage our successful merger integration experience with the SouthTrust organization,” Carroll said. “We believe our customer retention and revenue growth results can be duplicated and perhaps even exceeded.”
The combined company will have the top retail banking market share in North Carolina, Virginia, Georgia and South Carolina, and the second largest market share in Washington, D.C., Florida, Alabama, Pennsylvania and New Jersey. The new franchise will have 90 percent of its deposits in markets where it holds the No. 1 or 2 deposit market share.
If the two companies were combined today, they would have total deposits of $267 billion. The company’s 14 million households and businesses would be served by 98,000 employees, 3,200 banking branches and 5,300 ATMs.
Mr. Malone and two other members of SouthTrust’s board of directors will join the Wachovia board of directors when the transaction is completed. Wachovia will continue to be headquartered in Charlotte.
“Wachovia’s recent history has been a story of high performance, execution and focus, revenue growth and expense control,” said Thompson. “We believe the SouthTrust transaction
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will enable us to generate even higher growth and continue to deliver the performance our investors expect from Wachovia. Our acquisitions have been priced and integrated with discipline, and we have adhered to our financial performance hurdles.”
The transaction is expected to close in the fourth quarter of 2004 and is subject to normal regulatory approvals and approval by both companies’ shareholders. In connection with the agreement, SouthTrust has granted Wachovia an option to purchase, under certain circumstances, up to 19.5 percent of its outstanding common shares.
***
Wachovia Corporation (NYSE:WB) is one of the largest providers of financial services to retail, brokerage and corporate customers throughout the East Coast and the nation, with assets of $411.0 billion, market capitalization of $61.7 billion and stockholders’ equity of $33.3 billion at March 31, 2004. Its four core businesses, the General Bank, Capital Management, Wealth Management, and the Corporate and Investment Bank, serve 12 million client relationships (including households and businesses), primarily in 11 East Coast states and Washington, D.C. Its full-service retail brokerage firm, Wachovia Securities, LLC, serves clients in 49 states. Global services are provided through 32 international offices. Online banking and brokerage products and services also are available through Wachovia.com.
SouthTrust Corporation (Nasdaq: SOTR) is a $52.7 billion regional bank holding company with headquarters in Birmingham, Ala. SouthTrust operates 712 banking and loan offices and 894 ATMs in Alabama, Florida, Georgia, Mississippi, North Carolina, South Carolina, Tennessee, Texas and Virginia. The company offers a complete line of banking and other related financial services to commercial and retail customers. The company’s web site is www.southtrust.com.
Merger Conference Call Information
A conference call and audio webcast to discuss the Wachovia-SouthTrust merger will begin at 9 a.m. Eastern Time (8 a.m. Central Time) today. Slides that accompany the conference call are available on the Internet at Wachovia.com/investor, and investors are encouraged to access these materials in advance of the conference call.
Webcast Instructions: To gain access to the webcast, which will be “listen-only,” go to Wachovia.com/investor and click on the link “Wachovia-SouthTrust Merger Audio Webcast.” In order to listen to the webcast, you will need to download either Real Player or Media Player.
Teleconference Instructions: The telephone number for the conference call is 1-888-357-9787 for U.S. callers or 1-706-679-7342 for international callers. You will be asked to tell the answering coordinator your name and the name of your firm. Mention the conference Access Code: 4851.
Replay: Monday, June 21, at 12:30 p.m. Eastern Time (11:30 a.m. Central Time) through 11 p.m. Eastern Time (10 p.m. Central Time) on July 21. Replay telephone number is 1-706-645-9291; access code 8279509.
Video News Release: B-roll with footage of the two companies can be downlinked from the following coordinates: SBS-6, Transponder 15, 11:00-11:30 a.m. ET (10:00-10:30 a.m. Central Time).
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Forward-Looking Statements
This news release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including, without limitation, (i) statements about the benefits of the merger between Wachovia Corporation and SouthTrust Corporation, including future financial and operating results, cost savings, enhanced revenues, and accretion to reported earnings that may be realized from the merger; (ii) statements with respect to Wachovia’s and SouthTrust’s plans, objectives, expectations and intentions and other statements that are not historical facts; and (iii) other statements identified by words such as “believes”, “expects”, “anticipates”, “estimates”, “intends”, “plans”, “targets” and similar expressions. These statements are based upon the current beliefs and expectations of Wachovia’s and SouthTrust’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 materially from the anticipated results or other expectations expressed in such forward-looking statements: (1) the risk that the businesses of Wachovia and SouthTrust will not be integrated successfully or such integration may be more difficult, time-consuming or costly than expected; (2) expected revenue synergies and cost savings from the merger may not be fully realized or realized within the expected time frame; (3) revenues following the merger may be lower than expected; (4) deposit attrition, operating costs, customer loss and business disruption following the merger, including, without limitation, difficulties in maintaining relationships with employees, may be greater than expected; (5) the ability to obtain governmental approvals of the merger on the proposed terms and schedule; (6) the failure of Wachovia’s and/or SouthTrust’s shareholders to approve the merger; (7) competitive pressures among depository and other financial institutions may increase significantly and have an effect on pricing, spending, third-party relationships and revenues; (8) the strength of the United States economy in general and the strength of the local economies in which the combined company will conduct operations may be different than expected resulting in, among other things, a deterioration in credit quality or a reduced demand for credit, including the resultant effect on the combined company’s loan portfolio and allowance for loan losses; (9) changes in the U.S. and foreign legal and regulatory framework; and (10) adverse conditions in the stock market, the public debt market and other capital markets (including changes in interest rate conditions) and the impact of such conditions on the combined company’s capital markets and asset management activities. Additional factors that could cause Wachovia’s and SouthTrust’s results to differ materially from those described in the forward-looking statements can be found in Wachovia’s and SouthTrust’s Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K filed with the Securities and Exchange Commission. All subsequent written and oral forward-looking statements concerning the proposed transaction or other matters and attributable to Wachovia or SouthTrust or any person acting on their behalf are expressly qualified in their entirety by the cautionary statements referenced above. Wachovia and SouthTrust do not undertake any obligation to update any forward-looking statement to reflect circumstances or events that occur after the date the forward-looking statements are made.
Additional Information
The proposed transaction will be submitted to Wachovia’s and SouthTrust’s shareholders for their consideration, and Wachovia and SouthTrust will file a registration statement, a joint proxy statement/prospectus and other relevant documents concerning the proposed transaction with the SEC. Shareholders are urged to read the registration statement and the joint proxy statement/prospectus regarding the proposed transaction when it becomes
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available and any other relevant documents filed with the SEC, as well as any amendments or supplements to those documents, because they will contain important information. You will be able to obtain a free copy of the joint proxy statement/prospectus, as well as other filings containing information about Wachovia and SouthTrust, at the SEC’s Internet site (http://www.sec.gov). You will also be able to obtain these documents, free of charge, at www.wachovia.com under the tab “Inside Wachovia – Investor Relations” and then under the heading “Financial Reports – SEC Filings”. You may also obtain these documents, free of charge, at www.SouthTrust.com under the tab “About SouthTrust”, then under “Investor Relations” and then under “SEC Documents.” Copies of the joint proxy statement/prospectus and the SEC filings that will be incorporated by reference in the joint proxy statement/prospectus can also be obtained, without charge, by directing a request to Wachovia Corporation, Investor Relations, One Wachovia Center, 301 South College Street, Charlotte, NC 28288-0206, (704)-374-6782, or to SouthTrust Corporation, P. O. Box 2554, Birmingham, AL 35290, (205)-254-5187.
Wachovia and SouthTrust, and their respective directors and executive officers, may be deemed to be participants in the solicitation of proxies from the shareholders of Wachovia and SouthTrust in connection with the merger. Information about the directors and executive officers of Wachovia and their ownership of Wachovia common stock is set forth in the proxy statement, dated March 15, 2004, for Wachovia’s 2004 annual meeting of shareholders, as filed with the SEC on a Schedule 14A. Information about the directors and executive officers of SouthTrust and their ownership of SouthTrust common stock is set forth in the proxy statement, dated March 8, 2004, for SouthTrust’s 2004 annual meeting of shareholders, as filed with the SEC on a Schedule 14A. Additional information regarding the interests of those participants and other persons who may be deemed participants in the transaction may be obtained by reading the joint proxy statement/prospectus regarding the proposed transaction when it becomes available. You may obtain free copies of these documents as described in the preceding paragraph.
***
Investors seeking further information should contact Wachovia Investor Relations: Alice Lehman at 704-374-4139, Ellen Taylor at 704-383-1381, or Jeff Richardson at 704-383-8250; or SouthTrust Investor Relations: Bill Prater at 205-254-5187. Media seeking further information should contact Wachovia Corporate Media Relations: Christy Phillips at 704-383-8178 or Mary Eshet at 704-383-7777; or SouthTrust Corporate Communications: David M. Oliver, 205-254-5523, or dial 254-5130 and ask to speak to a media relations representative.
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THE FOLLOWING ARE MATERIALS USED IN A PRESENTATION HELD ON JUNE 21, 2004 FOR ANALYSTS REGARDING THE MERGER
Accelerates momentum in high-growth Southern U.S.
Presentation to Investors June 21, 2004
Extends retail and commercial banking leadership in high growth Southeastern markets
Strategic rationale
Creates #1 position in Southeast*, with a 18% deposit share
Provides immediate scale in fast-growing Texas market
Further enhances Wachovia’s pro forma business mix
75% of earnings in traditional banking and retail securities businesses
Retail and middle market commercial loans / total loans increased to 85%
Financially sound
In line with previous acquisition guidance
Accretive to cash EPS within two years
IRR of 16%
Analysis based on very achievable assumptions
Cost saves: 36% of SouthTrust expenses
No revenue synergies assumed
Significant additional excess capital generated
Low risk transaction
Largely in-market, premier franchise with 53 consecutive quarters of increased earnings and strong credit quality
Assumptions validated by recent and highly successful integration of Wachovia/First Union
Clean, straightforward systems environment
*Includes AL, FL, GA, MS, NC, SC, TN, VA; excludes deposits from brokerage/credit card related companies.
Page 1 – #3040 – Accelerates momentum in high-growth Southern U.S.
Transaction summary
Consideration*
$14.3 billion, 100% in stock
Exchange Ratio
0.89 Wachovia shares for each SouthTrust share
Incremental Share Repurchases
$1.7 billion excess capital available at closing
Dividend Policy
Current WB quarterly dividend of $0.40 per share
Estimated Divestitures
Less than $1 billion in deposits
Timing
Expected closing 4th quarter 2004
Approvals
Normal regulatory and shareholder approvals
Board Composition
3 additional directors from SouthTrust including CEO Wallace D. Malone, Jr.
Due Diligence
Completed on both sides
Other
19.5% stock option granted to Wachovia
*Based on Wachovia’s closing stock price on June 18, 2004.
Page 2 – #3040 – Accelerates momentum in high-growth Southern U.S.
SouthTrust: Snapshot of a premier franchise
Summary Statistics
Assets: $52,673 million*
Loans: $35,892 million*
Equity: $4,497 million*
10-year Earnings Per Share CAGR**: 12%
# 1 in Southeast
10-year Revenue Per Share CAGR**: 9%
10-year Average Net Charge-offs**: 0.28%
# 1 among Top 20 U.S. Banks
ATMs: 894
FTEs: 12,500
Retail Households Served: 1,500,000+
Business Customers: 200,000+
Deposit Franchise
Deposits States Branches Amount ($ in millions) Percent of Total Share Rank
Florida 283 $10,949 34.6% 4
Alabama 159 9,339 29.5 2
Georgia 120 5,609 17.7 6
Texas 60 2,119 6.7 20
Virginia 37 1,172 3.7 11
Tennessee 14 911 2.9 10
North Carolina 38 852 2.7 11
South Carolina 19 391 1.2 15
Mississippi 12 321 1.0 16
742 $31,664 100.0%
*As of 3/31/04.
**10-year time frame, ending 12/31/03. EPS CAGR through 2004 using First Call consensus estimates and ranking based on large regional banking peers.
All data does not reflect the subsequent acquisition of FloridaFirst.
Source: SNL Financial as of 6/30/03.
Pro forma for subsequent FloridaFirst acquisition
Page 3 – #3040 – Accelerates momentum in high-growth Southern U.S.
Accelerates momentum in high-growth Southern U.S.
Largely in-market transaction, creating #1 position in highly attractive Southeastern banking market*
52% of SouthTrust branches within 2 miles of a Wachovia branch
Enhances WB’s unique franchise which cannot be replicated
Wachovia
SouthTrust
Source: SNL Financial, data as of 6/30/03.
Pro forma for subsequent FloridaFirst acquisition
Southeast Banking Market*
Rank Institution Branches Deposits ($ in billions) Market Share
1 Wachovia/SouthTrust** 2,302 $158.6 18.3 %
2 Bank of America 1,568 131.9 15.2
- Wachovia 1,637 129.1 14.9
3 SunTrust 1,498 82.8 9.6
4 BB&T 1,179 51.9 6.0
5 Regions Financial 850 34.9 4.0
- SouthTrust 665 29.5 3.4
Source: SNL Financial, data as of 6/30/03 (pro forma for subsequent / pending acquisitions).
*Includes AL, FL, GA, MS, NC, SC, TN, VA; excludes deposits from brokerage/credit card related companies.
**Excludes impact of potential deposit divestitures and/or branch closures.
Page 4 – #3040 – Accelerates momentum in high-growth Southern U.S.
Combination strengthens position in fastest growing MSAs
% of Deposits in MSAs
U.S. Average = 86.3%
96.3% 94.6% 90.6% 87.7% 82.9%
BAC WB / SOTR FITB USB WFC
Projected Deposit Weighted 5 Year Average Population Growth Within MSAs
U.S. Average = 5.3%
7.3% 7.2% 6.8% 4.7% 3.0%
WFC WB / SOTR BAC USB FITB
Source: SNL Financial, deposit data as of 6/30/03.
Approximately 90% of WB / SOTR deposits in states where it will have a #1 or #2 deposit market share
State Deposits ($ in billions) Pro Forma Market Share Rank
North Carolina $41.2 28.0 % #1
Virginia 21.4 21.0 1
Georgia 25.6 20.5 1
South Carolina 8.8 19.7 1
D.C. 3.4 21.9 2
Florida 51.0 19.0 2
Alabama 9.3 15.5 2
Pennsylvania 25.5 12.3 2
New Jersey 20.2 10.3 2
Delaware 1.3 8.6 3
Connecticut 5.3 7.7 4
Maryland 5.4 6.9 6
Tennessee 0.9 1.1 10
New York 6.6 1.1 15
Mississippi 0.3 1.0 16
Texas 2.1 0.8 20
Note: Pro forma excludes impact of potential deposit divestitures. VA excludes Capital One and E-Trade, TX excludes USAA and Countrywide Financial, and DE excludes non-traditional banking operations.
Page 5 – #3040 – Accelerates momentum in high-growth Southern U.S.
Texas “Golden Triangle” presence anchors branch expansion strategy
Second most populous state
5-year projected market deposit growth of $70 billion—$80 billion*
Focus on Houston, Dallas / Ft. Worth, San Antonio / Austin
64 branch network** creates immediate scale, customer base and market share
Accelerates profitability and reduces dilution of Texas expansion strategy by an aggregate $0.06-$0.07 per share over the next 4 years***
Benefit not included in pro forma financials
Expedites branch build of approximately 150-175 new locations over the next 4 years
*Source: Stephens Inc.
**As of 12/31/03.
***From 2005 – 2008.
Page 6 – #3040 – Accelerates momentum in high-growth Southern U.S.
Increases contribution of traditional banking/retail securities businesses
Builds on Wachovia General Bank’s strong track record
13% organic earnings CAGR since 1Q02
Superior customer service/loyalty and sales results
Pro Forma Segment Earnings* Composition
($ in millions)WB 3/31/04* $4,737 Pro Forma** $5,460
General Bank 54% 59%
Capital Management 11% 10%
Wealth Management 3% 3%
Parent 3% 3%
Corp & Invest Bank 29% 25%
*Represents trailing twelve months segment earnings prepared under generally accepted accounting principles; excludes merger-related and restructuring expense which equaled $266 million after tax over this period and a $17 million after-tax expense associated with a change in accounting principle. (Trailing twelve months GAAP net income available to common shareholders was $4,488 million.)
**Based on estimated segmentation of SouthTrust’s earnings as of 3/31/04.
Page 7 – #3040 – Accelerates momentum in high-growth Southern U.S.
General Bank’s proven success provides for additional upside
Customer Satisfaction Scores*
5.59 6.13 6.29 6.37 6.55 6.58
20% Customer Attrition 11%
1Q99 1Q00 1Q01 1Q02 1Q03 1Q04
*Data is from independent studies conducted with customers who transact in our Financial Centers. Scale of 1–7.
Low Cost Core Deposit Growth ($ in billions)
$105 $112 $118 $123 $127
21 %
1Q03 2Q03 3Q03 4Q031Q04
Employing best practices yields new revenue opportunities
Not included in pro forma financials
Productivity Equalization
($ in millions) SouthTrust % of WB Avg. Branch Production Potential Revenue Lift/Year
Consumer loans 22 % $50
Small business loans 53 10
Investment sales fees 37 50
Low cost core deposits 65
Branch production revenue lift $175
Adopting SouthTrust’s commercial real estate sales process
Sales process revenue lift $30
Potential Annual Revenue Upside $205 million
Page 8 – #3040 – Accelerates momentum in high-growth Southern U.S.
Increases contribution of retail and middle market assets
Retail and commercial loans are higher RAROC and lower volatility assets
Average Retail and Commercial Loans* / Total Loans
71.6% 72.4% 73.2% 73.5% 74.8% 77.3% 78.2% 79.8% 80.7% 81.3% 85.0%
4Q01 1Q02 2Q02 3Q02 4Q02 1Q03 2Q03 3Q03 4Q03 1Q04 1Q04**
*Retail and middle market commercial loans; excludes corporate loans.
**Estimated pro forma.
Page 9 – #3040 – Accelerates momentum in high-growth Southern U.S.
Low-risk integration
SouthTrust is a high-quality, high-performing and proven organization
12% CAGR EPS growth over the past 10 years (highest in the Southeast*)
Builds on highly successful Wachovia/First Union integration
Very consistent footprint, customer base and business line overlap
Incorporates key SouthTrust personnel in significant roles, primarily in General Bank and staff areas
Wachovia is integration ready
Wachovia/First Union integration complete
Prudential conversion unaffected
Leverages Wachovia’s systems and excess capacity
Systems environments are clean, straight-forward and compatible
Similar cultures
Customer focused and performance oriented
*Among large regional banking peers.
Page 10 – #3040 – Accelerates momentum in high-growth Southern U.S.
Financial assumptions
Fixed Exchange Ratio
0.89 WB shares for each SouthTrust share, 22% premium to market*
EPS Assumptions/Growth
First Call estimate for 2005,
First Call long-term EPS growth rates
(10% for WB and 11% for SouthTrust) thereafter
Integration Period
15 months after closing in 4Q04
Expense Efficiencies $255 million after-tax
One-time Costs $431 million after-tax ($156 million P&L impact)
Revenue Enhancements
None included in model
Deposit Divestitures
Less than $1 billion
Targeted Capital Ratios
Leverage ratio**: 6.00%
Incremental Share Repurchases
$1.7 billion in excess capital available at closing
*Based on five day average of Wachovia and SouthTrust closing stock prices through June 18, 2004.
**Leverage ratio: Tier 1 Capital / Average Tangible Assets.
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Significant additional excess capital available for repurchases
$1.7 billion additional capital available in addition to ongoing Wachovia repurchases
Maintain Wachovia’s current target leverage ratio of 6%
Sources of additional excess capital
($ in billions)
SouthTrust Excess Capital* $1.2
$13 billion Substitution of SouthTrust Loans for Securities** 0.6
Release of Excess Capital Retained for Cash Acquisitions 0.3
Less: 4Q04 Cash One-times / DBI Deferred Tax Liability (0.4)
Incremental Capital Available for Share Repurchases $1.7
*Combined company leverage ratio of 6% and tangible capital/ tangible asset ratio of 4.7%. SouthTrust’s current TCE/TCA ratio is 7%.
**Reduction in lower-yielding securities in Wachovia’s portfolio purchased with recent growth in FDIC-insured sweep deposits.
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Pro forma earnings
($in millions after-tax) 2005E 2006E 2007E
Wachovia Cash Earnings* $5,676 $6,018 $6,427
SouthTrust Cash Earnings* 856 951 1,053
Expense Efficiencies 160 277 288
Amortization/Accretion of Purchase Acctg. Adjust. (56) (24) 7
Divested Income/Net Funding Impact** 29 9 (5)
Combined Cash Earnings* $6,665 $7,231 $7,770
Existing DBI & Other Intangible Amortization (146) (72) (21)
New DBI Amortization*** (95) (85) (76)
Combined Operating Earnings**** $6,424 $7,074 $7,673
One-time Transaction Expenses***** (93) (47) 0
Combined GAAP Earnings $6,331 $7,027 $7,673
*Illustrates net income applicable to common shareholders before merger-related and restructuring expenses, intangible amortization, and preferred dividends; assumes First Call consensus estimates for 2005 of $4.30 per share for WB and $2.51 per share for SOTR and consensus 5-year operating EPS growth expectations of 10% for WB and 11% for SOTR.
**Primarily higher securities yields; foregone income on securities replaced with loans; and reduced borrowing costs, offset by a net increase in funding costs associated with restructuring costs and with anticipated share repurchases (see footnote on page 14 for repurchase assumptions).
***Assumes DBI created equal to 3% of $28.8 billion core deposit base amortized over 10 years sum-of-years’ digits.
****Illustrates net income applicable to common shareholders before merger-related and restructuring expenses and preferred dividends.
*****One-time expenses associated with prior transactions expected to be immaterial in 2005-2007.
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Pro forma EPS and IRR
2005E 2006E 2007E
Combined Cash Earnings* $6,665 $7,231 $7,770
Combined Operating Earnings** $6,424 $7,074 $7,673
Combined Average Fully Diluted Shares*** 1,548 1,507 1,469
Combined Cash EPS* $4.30 $4.80 $5.29
Wachovia Implied Consensus Cash EPS**** $4.41 $4.79 $5.22
Wachovia Accretion / (Dilution) ($0.11) $0.01 $0.07
Combined Operating EPS** $4.15 $4.69 $5.22
Wachovia Consensus Operating EPS $4.30 $4.73 $5.20
Wachovia Accretion / (Dilution) ($0.15) ($0.04) $0.02
IRR (See Appendix page 24) = 16%
*Illustrates combined net income applicable to common shareholders before merger-related and restructuring expenses, intangible amortization, and preferred dividends.
**Illustrates combined net income applicable to common shareholders before merger-related and restructuring expenses and preferred dividends.
***Assumes average fully diluted share count for WB stand-alone of 1,286 million in 2005, 1,257 million in 2006 and 1,232 million in 2007 and SOTR stand-alone of 340 million (or 303 million WB shares at exchange ratio). Assumes share repurchases using excess capital above a 6% leverage ratio using a WB share price of $47.00 for 2004, with average prices grown at 10% in 2005, 2006 and 2007.
****Based on First Call operating EPS consensus estimates as of June 18, 2004 excluding intangible amortization. See pages 11-13 for other assumptions.
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Expense efficiencies evident
Expect annual expense efficiencies of $255 million after-tax by 2007
Represents 36% of SouthTrust’s expenses
130—150 branch consolidations projected
4,300 planned position reductions
($ in millions) Pre-tax After-tax*
Personnel $ 265 $ 163
Occupancy and Equipment 86 53
Other 63 39
Total $ 414 $ 255
Expect to realize 10% in 2004, 60% in 2005 and 100% in 2006
*Assumes marginal tax rate of 38.5%.
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Efficiencies comparable with Wachovia/First Union
Similar Branch Overlap
Wachovia/First Union 191 Closures*
Wachovia/SouthTrust 130-150 Closures
Similar Expense Efficiencies
Wachovia/First Union Wachovia/SouthTrust
($ in millions pre-tax)
195 325 200 281
1/2 mi 1 mi 1/2 mi 1 mi
$890 38%** $414 36%**
*As of May 31, 2004 and compared to original estimate of 250-300.
**% of operating expenses.
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One-time merger-related costs
Expect total one-time cash costs of $431 million after-tax
($ in millions after-tax) P&L Exit Cost PAAs Total*
Personnel $ 101 $ 175 $ 276
Occupancy and Equipment 32 58 90
Other 23 42 65
Total $ 156 $ 275 $ 431
Estimated recognition of cash costs
$156 million merger-related and restructuring expenses through P&L: 10% in 2004, 60% in 2005 and 30% in 2006
$275 million in exit cost PAAs to goodwill: 10% at closing, 10% in remainder of 2004, 55% in 2005, and 25% in 2006
Fair market value adjustments**
Currently expect additional $232 million after-tax in fair market value PAAs on tangible net assets at closing (adjustments to goodwill)
*Total pre-tax one-time cash charges of $700 million: $253 million pre-tax merger-related/restructuring expenses through P&L, $447 million pre-tax PAAs to goodwill reflecting integration costs relating to SouthTrust operations. Assumes tax rate of 38.5%.
**Additional $377 million pre-tax fair market value PAAs driven by pension adjustment and estimated mark-to-market PAAs to SouthTrust’s financial assets and liabilities and equipment.
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Proven integration capabilities
Delivering on goals stated in WB/FTU Investor Presentation*
Cash EPS Results versus Estimates
$3.67 $3.60 $4.11 $4.10
Announced Actual 2003 Announced First Call Est. 2004E
Position Reductions Stated Goal: 7,000 position reductions
One-Time Charges Stated Goal: $1,515 million
7,000 7,000
Announced Actual
$1,515 $1,315
Announced Expected
*Projected goals at merger announcement on April 16, 2001.
Note: Cash earnings for 2003 exclude merger-related and restructuring expenses, identified intangible amortization. One-time charges increased due to hostile takeover fight costs.
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In summary
Strategic rationale
Creates #1 position in Southeast*, with a 18% deposit share
Provides immediate scale in fast-growing Texas market
Further enhances Wachovia’s pro forma business mix
75% of earnings in traditional banking and retail securities businesses
Retail and middle market commercial loans / total loans increased to 85%
Financially sound
In line with previous acquisition guidance
Accretive to cash EPS within two years
IRR of 16%
Analysis based on very achievable assumptions
Cost saves: 36% of SouthTrust expenses
No revenue synergies assumed
Significant additional excess capital generated
Low risk transaction
Largely in-market, premier franchise with 53 consecutive quarters of increased earnings and strong credit quality
Assumptions validated by recent and highly successful integration of Wachovia/First Union
Clean, straightforward systems environment
*Includes AL, FL, GA, MS, NC, SC, TN, VA; excludes deposits from brokerage/credit card related companies.
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Appendix
Pro forma 4Q04 earnings
Pro forma 4Q04 EPS
Pro forma balance sheet
IRR detail
Integration timeline
Deal comparables
SouthTrust: Superior credit quality vs. peers
Pro forma top 20 MSA market shares
Page 20 – #3040 – Accelerates momentum in high-growth Southern U.S.
Pro forma 4Q04 earnings
($ in millions after-tax) 4Q04E
Wachovia Cash Earnings* $1,377
SouthTrust Cash Earnings* 134
Expense Efficiencies 26
Amortization/Accretion of PAAs (10)
Divested Income/Net Funding Impact** 0
Combined Cash Earnings* $1,527
Existing DBI & Other Intangible Amortization (58)
New DBI Amortization*** (16)
Combined Operating Income**** $1,453
Existing One-time Expenses (65)
One-time Expenses (16)
Combined GAAP Earnings $1,372
*Illustrates net income applicable to common shareholders before merger-related and restructuring expenses, intangible amortization, and preferred dividends; assumes First Call consensus estimates for 4Q04 of $1.00 per share for WB and $0.59 per share for SOTR (two months).
**Primarily higher securities yields; foregone income on securities replaced with loans; and reduced borrowing costs, offset by a net increase in funding costs associated with restructuring costs and with anticipated share repurchases (see footnote on page 14 for repurchase assumptions).
***Assumes DBI created equal to 3% of $28.8 billion core deposit base amortized over 10 years sum-of-years’ digits.
****Illustrates net income applicable to common shareholders before merger-related and restructuring expenses and preferred dividends.
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Pro forma 4Q04 EPS
4Q04E
Combined Cash Earnings* $1,527
Combined Operating Earnings** $1,453
Combined Average Fully Diluted Shares*** 1,497
Combined Cash EPS $1.02
Wachovia Implied Consensus Cash EPS**** $1.04
Wachovia Accretion / (Dilution) ($0.02)
Combined Operating EPS $0.97
Wachovia Consensus Operating EPS $1.00
Wachovia Accretion / (Dilution) ($0.03)
*Illustrates combined net income applicable to common shareholders before merger-related and restructuring expenses, intangible amortization, and preferred dividends.
**Illustrates combined net income applicable to common shareholders before merger-related and restructuring expenses and preferred dividends.
***Assumes 4Q04 average fully diluted share count for WB stand-alone of 1,319 million and SOTR stand-alone of 340 million (or 303 million WB shares at exchange ratio; two months’ impact). Assumes share repurchases using excess capital above a 6% leverage ratio using a WB share price of $47.00.
****Based on First Call operating EPS consensus estimate as of June 18, 2004 excluding intangible amortization.
See pages 11, 12 and 21 for other assumptions.
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Pro forma balance sheet
($ in millions) Wachovia* SouthTrust* Purchase Acctg Adjustments** Post Close Actions Pro Forma
Cash $40,290 $1,491 - $100 $41,881
Securities & Short Term Investments 141,096 11,720 (311) (13,637) 138,868
Total Loans 167,303 37,004 (596) (540) 203,171
Allowance for Loan Losses (2,487) (506) - - (2,993)
Net Loans 164,816 36,499 (596) (540) 200,178
Other Assets 64,789 3,737 10,399 - 78,925
Total Assets $410,991 $53,446 $9,492 ($14,077) $459,852
Total Deposits $232,338 $36,054 ($645) ($850) $266,897
Borrowed Funds 101,698 11,860 (85) (11,627) 101,846
Other Liabilities 37,984 956 548 - 39,488
Trust Preferred & Minority Interest 5,634 - - - 5,634
Common Equity 33,337 4,576 9,674 (1,600) 45,987
Total Liabilities and Capital $410,991 $53,446 $9,492 ($14,077) $459,852
Leverage Ratio*** 6.33% 6.79% (0.06%) (0.24%) 6.09%
*As of March 31, 2004. SouthTrust is pro forma for subsequent acquisition of FloridaFirst.
**Illustrates purchase accounting adjustments to estimated balance sheet at closing. $311 million adjustment reflects estimated change in market value of SouthTrust’s securities portfolio since 3/31/04 (not a purchase accounting adjustment).
***Assumes combined blended average of approximately 6.39% before adjustments.
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IRR detail
IRR to WB at 0.89 Exchange Ratio
($ in millions) 11/1/04 2004 2005 2006 2007 IRR
Aggregate Offer Value ($14,250)
Net Extracted Excess Capital* 1,152
After-Tax Cash One-Times (43) (39) (233) (116)
Capital to Fund SouthTrust Asset Growth** (27) (171) (182) (194)
Expense Efficiencies 26 160 277 288
SouthTrust Cash Income*** 100 131 838 933 1,035
Net Funding Benefits**** 9 47 40 36
Terminal Value of 2008 Income (12x) 17,748
Incremental Cash Flow ($13,041) $100 $641 $952 $18,913 16 %
*SouthTrust’s capital in excess of target ratio of 4.7%, less fair market value adjustments to SouthTrust’s net tangible assets.
**Assumes asset growth of 7%.
***Assumes First Call consensus estimates at consensus growth rates, net of divested income (assumed at $18 million per year before reinvestment of premium). Assumes $100 million in after-tax gains from sale of card portfolio and deposit divestitures.
****Net benefit from substitution of loans for securities and replacement of high cost funding, offset by sale of excess securities and charge for use of SouthTrust’s excess capital. High cost funding benefit not included in terminal value (finite life assumed).
See financial assumptions in main body of presentation.
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Integration timeline
Disciplined, deliberate and methodical process as in Wachovia Bank and Prudential integrations
Co-Heads: David Carroll (Wachovia); Frank Schmidt (SouthTrust)
2-3Q 2004 4Q 2004 1Q 2005 2Q 2005 3Q 2005 4Q 2005 1Q 2006
Transaction Announcement
Joint integration team formed
Detailed planning
Closing
Select infrastructure linkages and conversions
Systems testing begins
Product alignment
G/L, Payroll & Benefits, A/P, and Purchasing conversions complete
1st deposit conversion
Loan conversions complete conversion
2nd deposit conversion
Regional conversions
Rebranding
Integration complete
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Deal comparables
Buyer/Target Announce Date Deal Value ($ billion) Price /Forward EPS NTM* w/Synergies Consensus 5 Year Forward Growth Rate NTM* PEG w/o Synergies w/Synergies Price/Tangible Book
SunTrust / National Commerce 2004 $6.8 17.5 x 14.7 x 11 % 1.56 x 1.31 x 4.39 x
Bank of America / FleetBoston Financial 2003 49.7 16.9 12.2 9 1.88 1.35 3.68
BB&T Corp / First Virginia Banks 2003 3.4 17.4 12.8 7 2.48 1.83 3.19
Fifth Third / Old Kent Financial 2000 4.9 14.3 11.3 10 1.43 1.13 3.38
FleetBoston Financial / Summit Bancorp 2000 7.0 12.5 9.5 9 1.39 1.05 2.91
AmSouth / First American 1999 6.3 18.9 15.0 10 1.89 1.49 4.00
Firstar Corp / Mercantile Bancorp 1999 10.7 21.0 17.3 8 2.63 2.15 4.65
Average 16.9 x 13.3 x 9 % 1.89 x 1.48 x 3.74 x
Wachovia / SouthTrust $14.3 17.6 x 13.4 x 11 % 1.60 x 1.22 x 3.76 x
Wachovia / SouthTrust Adj. for Excess Capital $13.1 16.8 x 12.6 x 11 % 1.53 x 1.15 x
All bank acquisitions, excluding mergers of equals, over the last 5 years with a deal value greater than $3 billion.
PEG = Price / forward EPS ratio divided by growth rate.
Wachovia stock price as of 6/18/04
*Next twelve months.
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SouthTrust: Superior credit quality vs. peers
#1 of Top 20 Banks over 10 years*
Net Charge-off Ratio vs. Top 20 Banks
0.27% 0.29% 0.45% 0.52% 0.46% 0.42% 0.49% 0.90% 0.90% 0.72% 0.54% Median
0.19% 0.22% 0.28% 0.25% 0.24% 0.29% 0.29% 0.35% 0.34% 0.36% 0.31% SouthTrust
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 1Q04
Median SouthTrust
*10-year average among Top 20 Banks.
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Pro forma top 20 MSA market shares
($ in millions)
Top 20 MSAs Total Branches Total Deposits Rank Market Share
Charlotte-Gastonia-Rock Hill 91 $25,010 #2 37.3%
Atlanta 241 20,937 1 28.2
Philadelphia 236 20,204 1 23.7
Washington 146 13,775 1 13.2
Newark 87 7,672 1 18.3
Miami 77 7,650 2 13.7
Tampa-St.Petersburg-Clearwater 153 7,555 2 21.0
West Palm Beach-Boca Raton 105 6,510 1 23.8
New York 53 6,312 10 1.6
Fort Lauderdale 96 5,786 2 20.7
Jacksonville 80 5,592 1 33.9
Richmond-Petersburg 94 5,431 2 19.5
Greensboro-Winston-Salem-High Point 62 5,118 2 23.4
New Haven-Bridgeport-Stamford-Danbury 72 4,913 3 13.7
Birmingham 42 4,646 1 24.9
Raleigh-Durham-Chapel Hill 61 4,176 1 27.1
Norfolk-Virginia Beach-Newport News 95 3,560 1 25.2
Orlando 76 3,346 3 14.9
Monmouth-Ocean 65 3,310 2 14.4
Middlesex-Somerset-Hunterdon 41 3,120 4 8.5
Source: SNL Financial – deposit data as of 6/30/2003.
Pro forma excludes deposit divestitures.
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Cautionary statement
This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including, without limitation, (i) statements about the benefits of the merger between Wachovia Corporation and SouthTrust Corporation, including future financial and operating results, cost savings, enhanced revenues, and accretion to reported earnings that may be realized from the merger; (ii) statements with respect to Wachovia’s and SouthTrust’s plans, objectives, expectations and intentions and other statements that are not historical facts; and (iii) other statements identified by words such as “believes”, “expects”, “anticipates”, “estimates”, “intends”, “plans”, “targets” and similar expressions. These statements are based upon the current beliefs and expectations of Wachovia’s and SouthTrust’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 materially from the anticipated results or other expectations expressed in such forward-looking statements: (1) the risk that the businesses of Wachovia and SouthTrust will not be integrated successfully or such integration may be more difficult, time-consuming or costly than expected; (2) expected revenue synergies and cost savings from the merger may not be fully realized or realized within the expected time frame; (3) revenues following the merger may be lower than expected; (4) deposit attrition, operating costs, customer loss and business disruption following the merger, including, without limitation, difficulties in maintaining relationships with employees, may be greater than expected; (5) the ability to obtain governmental approvals of the merger on the proposed terms and schedule and without greater divestitures than anticipated; (6) the failure of Wachovia’s and/or SouthTrust’s shareholders to approve the merger; (7) enforcement actions by governmental agencies that are not currently anticipated; (8) competitive pressures among depository and other financial institutions may increase significantly and have an effect on pricing, spending, third-party relationships and revenues; (9) the strength of the United States economy in general and the strength of the local economies in which the combined company will conduct operations may be different than expected resulting in, among other things, a deterioration in credit quality or a reduced demand for credit, including the resultant effect on the combined company’s loan portfolio and allowance for loan losses; (10) changes in the U.S. and foreign legal and regulatory framework; and (11) adverse conditions in the stock market, the public debt market and other capital markets (including changes in interest rate conditions) and the impact of such conditions on the combined company’s capital markets and asset management activities. Additional factors that could cause Wachovia’s and SouthTrust’s results to differ materially from those described in the forward-looking statements can be found in Wachovia’s and SouthTrust’s Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K filed with the Securities and Exchange Commission. All subsequent
written and oral forward-looking statements concerning the proposed transaction or other matters and attributable to Wachovia or SouthTrust or any person acting on their behalf are expressly qualified in their entirety by the cautionary statements referenced above. Wachovia and SouthTrust do not undertake any obligation to update any forward-looking statement to reflect circumstances or events that occur after the date the forward-looking statements are made.
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Additional information
The proposed transaction will be submitted to Wachovia’s and SouthTrust’s shareholders for their consideration, and Wachovia and SouthTrust will file a registration statement, a joint proxy statement/prospectus and other relevant documents concerning the proposed transaction with the SEC. Shareholders are urged to read the registration statement and the joint proxy statement/prospectus regarding the proposed transaction when it becomes available and any other relevant documents filed with the SEC, as well as any amendments or supplements to those documents, because they will contain important information. You will be able to obtain a free copy of the joint proxy statement/prospectus, as well as other filings containing information about Wachovia and SouthTrust, at the SEC’s Internet site (http://www.sec.gov). You will also be able to obtain these documents, free of charge, at www.wachovia.com under the tab “Inside Wachovia – Investor Relations” and then under the heading “Financial
Reports—SEC Filings”. You may also obtain these documents, free of charge, at www.southtrust.com under the tab “About SouthTrust”, then under “Investor Relations” and then under “SEC Documents”. Copies of the joint proxy statement/prospectus and the SEC filings that will be incorporated by reference in the joint proxy statement/prospectus can also be obtained, without charge, by directing a request to Wachovia Corporation, Investor Relations, One Wachovia Center, 301 South College Street, Charlotte, NC 28288-0206, (704)-374-6782, or to SouthTrust Corporation, P. O. Box 2554, Birmingham, AL 35290, (205)-254-5187.
Wachovia and SouthTrust, and their respective directors and executive officers, may be deemed to be participants in the solicitation of proxies from the shareholders of Wachovia and SouthTrust in connection with the merger. Information about the directors and executive officers of Wachovia and their ownership of Wachovia common stock is set forth in the proxy statement, dated March 15, 2004, for Wachovia’s 2004 annual meeting of shareholders, as filed with the SEC on a Schedule 14A. Information about the directors and executive officers of SouthTrust and their ownership of SouthTrust common stock is set forth in the proxy statement, dated March 8, 2004, for SouthTrust’s 2004 annual meeting of shareholders, as filed with the SEC on a Schedule 14A. Additional information regarding the interests of those participants and other persons who may be deemed participants in the transaction may be obtained by reading the joint proxy statement/prospectus regarding the proposed transaction when it becomes available. You may obtain free copies of these documents as described above.
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