CITIZENS FINANCIAL GROUP INC/RI - FORM 8-K - EX-99.3

Attached files

file	filename
EX-99.2 - EX-99.2 - CITIZENS FINANCIAL GROUP INC/RI	d272290dex992.htm
EX-99.1 - EX-99.1 - CITIZENS FINANCIAL GROUP INC/RI	d272290dex991.htm
8-K - 8-K - CITIZENS FINANCIAL GROUP INC/RI	d272290d8k.htm

Exhibit 99.3

LOGO

Citizens Financial Group, Inc.

Financial Supplement

Third Quarter 2016


Table of Contents	Page

Consolidated Financial Highlights		3

Consolidated Statements of Operations (unaudited)		5

Consolidated Balance Sheets (unaudited)		6

Loans and Deposits		7

Average Balance Sheets and Annualized Yields		8

Segment Financial Highlights		10

Credit-Related Information:
Credit Exposure		21
Nonperforming Assets		22
Charge-offs, Recoveries and Related Ratios		23
Summary of Changes in the Allowances		25
Allowance Components		26

Capital and Ratios		27

Per-Share Related Information		28
Key Performance Metrics, Non-GAAP Financial Measures and Reconciliations		29
Forward-Looking Statements		37

CONSOLIDATED FINANCIAL HIGHLIGHTS

(dollars in millions, except per share and ratio data)


	QUARTERLY TRENDS																							FOR THE NINE MONTHS ENDED SEP 30,
												3Q16 Change																	2016 Change
	3Q16		2Q16			1Q16		4Q15		3Q15		2Q16						3Q15						2016		2015			2015
												$			%			$			%								$			%
SELECTED OPERATING DATA
Total revenue	$	1,380	$	1,278		$	1,234	$	1,232	$	1,209	$	102			8	%	$	171			14	%	$	3,892	$	3,592		$	300			8	%
Noninterest expense		867		827			811		810		798		40			5			69			9			2,505		2,449			56			2

Profit before provision for credit losses		513		451			423		422		411		62			14			102			25			1,387		1,143			244			21
Provision for credit losses		86		90			91		91		76		(4	)		(4	)		10			13			267		211			56			27
NET INCOME		297		243			223		221		220		54			22			77			35			763		619			144			23
Net income, adjusted¹		278		243			223		221		220		35			14			58			26			744		650			94			14
Net income available to common stockholders		290		243			216		221		213		47			19			77			36			749		612			137			22
Net income available to common stockholders, adjusted¹		271		243			216		221		213		28			12			58			27			730		643			87			14
PER COMMON SHARE DATA
Basic earnings	$	0.56	$	0.46		$	0.41	$	0.42	$	0.40	$	0.10			22	%	$	0.16			40	%	$	1.43	$	1.14		$	0.29			25	%
Diluted earnings		0.56		0.46			0.41		0.42		0.40		0.10			22			0.16			40			1.42		1.13			0.29			26
Basic earnings, adjusted¹		0.52		0.46			0.41		0.42		0.40		0.06			13			0.12			30			1.39		1.20			0.19			16
Diluted earnings, adjusted¹		0.52		0.46			0.41		0.42		0.40		0.06			13			0.12			30			1.39		1.19			0.20			17
Cash dividends declared and paid per common share		0.12		0.12			0.10		0.10		0.10		—			—			0.02			20			0.34		0.30			0.04			13
Book value per common share		38.47		37.76			37.28		36.76		36.68		0.71			2			1.79			5			38.47		36.68			1.79			5
Tangible book value per common share		26.20		25.72			25.21		24.63		24.52		0.48			2			1.68			7			26.20		24.52			1.68			7
COMMON SHARES OUTSTANDING
Average: Basic		519,458,976		528,968,330			528,070,648		527,648,630		530,985,255		(9,509,354	)		(2	%)		(11,526,279	)		(2	%)		525,477,273		538,279,222			(12,801,949	)		(2	%)
Diluted		521,122,466		530,365,203			530,446,188		530,275,673		533,398,158		(9,242,737	)		(2	)		(12,275,692	)		(2	)		527,261,384		540,926,361			(13,664,977	)		(3	)
Common shares at period-end		518,148,345		529,094,976			528,933,727		527,774,428		527,636,510		(10,946,631	)		(2	)		(9,488,165	)		(2	)		518,148,345		527,636,510			(9,488,165	)		(2	)
Closing share price	$	24.71	$	19.98		$	20.95	$	26.19	$	23.86	$	4.73			24		$	0.85			4		$	24.71	$	23.86		$	0.85			4
Market capitalization		12,803		10,571			11,081		13,822		12,589		2,232			21			214			2			12,803		12,589			214			2
SEGMENT NET INCOME
Consumer Banking	$	92	$	90		$	71	$	67	$	68	$	2			2	%	$	24			35	%	$	253	$	195		$	58			30	%
Commercial Banking		162		164			133		152		145		(2	)		(1	)		17			12			459		427			32			7
Other		43		(11	)		19		2		7		54			NM			36			NM			51		(3	)		54			NM

NET INCOME	$	297	$	243		$	223	$	221	$	220	$	54			22	%	$	77			35	%	$	763	$	619		$	144			23	%

¹	These are non-GAAP financial measures. For further information on these measures, refer to pages 29-36.

CONSOLIDATED FINANCIAL HIGHLIGHTS, CONTINUED

(dollars in millions, except ratio and headcount data)


	QUARTERLY TRENDS																											FOR THE NINE MONTHS ENDED SEP 30,
																3Q16 Change																		2016 Change
	3Q16			2Q16			1Q16			4Q15			3Q15			2Q16						3Q15						2016			2015			2015
																$/bps			%			$/bps			%									$/bps			%
FINANCIAL RATIOS
Net interest margin		2.84	%		2.84	%		2.86	%		2.77	%		2.76	%		—	bps					8	bps					2.85	%		2.75	%		10	bps
Return on average common equity		5.82			4.94			4.45			4.51			4.40			88	bps					142	bps					5.08			4.23			85	bps
Return on average common equity, adjusted¹		5.44			4.94			4.45			4.51			4.40			50	bps					104	bps					4.95			4.45			50	bps
Return on average tangible common equity		8.58			7.30			6.61			6.75			6.60			128	bps					198	bps					7.51			6.34			117	bps
Return on average tangible common equity, adjusted¹		8.02			7.30			6.61			6.75			6.60			72	bps					142	bps					7.32			6.67			65	bps
Return on average total assets		0.82			0.69			0.65			0.64			0.65			13	bps					17	bps					0.72			0.62			10	bps
Return on average total assets, adjusted¹		0.77			0.69			0.65			0.64			0.65			8	bps					12	bps					0.70			0.65			5	bps
Return on average total tangible assets		0.86			0.72			0.68			0.67			0.68			14	bps					18	bps					0.75			0.65			10	bps
Return on average total tangible assets, adjusted¹		0.80			0.72			0.68			0.67			0.68			8	bps					12	bps					0.73			0.68			5	bps
Effective income tax rate		30.46			32.61			32.87			33.45			34.12			(215	) bps					(366	) bps					31.87			33.54			(167	) bps
Efficiency ratio		62.88			64.71			65.66			65.76			66.02			(183	) bps					(314	) bps					64.36			68.17			(381	) bps
Efficiency ratio, adjusted¹		63.31			64.71			65.66			65.76			66.02			(140	) bps					(271	) bps					64.54			66.78			(224	) bps
CAPITAL RATIOS - PERIOD END (PRELIMINARY)²
CET1 capital ratio		11.3	%		11.5	%		11.6	%		11.7	%		11.8	%
Tier 1 capital ratio		11.5			11.7			11.9			12.0			12.0
Total capital ratio		14.2			14.9			15.1			15.3			15.4
Tier 1 leverage ratio		10.1			10.3			10.4			10.5			10.4
SELECTED BALANCE SHEET DATA (PERIOD END)
Total assets	$	147,015		$	145,183		$	140,077		$	138,208		$	135,447		$	1,832			1	%	$	11,568			9	%	$	147,015		$	135,447		$	11,568			9	%
Loans and leases:
Commercial		50,389			49,557			47,972			46,214			45,269			832			2			5,120			11			50,389			45,269			5,120			11
Retail		55,078			53,994			53,019			52,828			52,162			1,084			2			2,916			6			55,078			52,162			2,916			6

Total loans and leases		105,467			103,551			100,991			99,042			97,431			1,916			2			8,036			8			105,467			97,431			8,036			8
Deposits	$	108,327		$	106,257		$	102,606		$	102,539		$	101,866		$	2,070			2		$	6,461			6		$	108,327		$	101,866		$	6,461			6
Long-term borrowed funds		11,902			11,810			10,035			9,886			4,153			92			1			7,749			187			11,902			4,153			7,749			187
Total stockholders’ equity		20,181			20,226			19,965			19,646			19,600			(45	)		—			581			3			20,181			19,600			581			3
Loans-to-deposits ratio (period-end balances)³		97.85	%		98.25	%		99.16	%		96.94	%		96.06	%		(40	) bps					179	bps					97.85	%		96.06	%		179	bps
Loans-to-deposits ratio (average balances)³		98.06			99.52			98.66			97.21			96.29			(146	) bps					177	bps					98.74			97.43			131	bps
Full-time equivalent colleagues		17,625			17,828			17,902			17,714			17,817			(203	)		(1	%)		(192	)		(1	%)		17,625			17,817			(192	)		(1	%)

¹	These are non-GAAP financial measures. For further information on these measures, refer to pages 29-36.

²	Basel III transitional rules for institutions applying the standardized approach to calculating risk-weighted assets became effective January 1, 2015. The capital ratios and associated components are prepared using the Basel III standardized transitional approach.

³	Ratios include loans and leases held for sale.

CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited)

(dollars in millions)


	QUARTERLY TRENDS																						FOR THE NINE MONTHS ENDED SEPT 30,
											3Q16 Change																2016 Change
	3Q16		2Q16		1Q16		4Q15		3Q15		2Q16						3Q15						2016		2015		2015
											$			%			$			%							$			%
INTEREST INCOME:
Interest and fees on loans and leases	$	926	$	896	$	868	$	830	$	812	$	30			3	%	$	114			14	%	$	2,690	$	2,381	$	309			13	%
Interest and fees on loans held for sale		4		3		3		2		3		1			33			1			33			10		8		2			25
Interest and fees on other loans held for sale		1		4		1		—		3		(3	)		(75	)		(2	)		(67	)		6		7		(1	)		(14	)
Investment securities		146		141		145		153		154		5			4			(8	)		(5	)		432		468		(36	)		(8	)
Interest-bearing deposits in banks		2		2		2		1		2		—			—			—			—			6		4		2			50

Total interest income		1,079		1,046		1,019		986		974		33			3			105			11			3,144		2,868		276			10

INTEREST EXPENSE:
Deposits		71		63		60		60		65		8			13			6			9			194		177		17			10
Federal funds purchased and securities sold under agreements to repurchase		1		—		1		3		4		1			100			(3	)		(75	)		2		13		(11	)		(85	)
Other short-term borrowed funds		10		12		11		16		17		(2	)		(17	)		(7	)		(41	)		33		51		(18	)		(35	)
Long-term borrowed funds		52		48		43		37		32		4			8			20			63			143		95		48			51

Total interest expense		134		123		115		116		118		11			9			16			14			372		336		36			11

Net interest income		945		923		904		870		856		22			2			89			10			2,772		2,532		240			9

NONINTEREST INCOME:
Service charges and fees		152		150		144		156		145		2			1			7			5			446		419		27			6
Card fees		52		51		50		60		60		1			2			(8	)		(13	)		153		172		(19	)		(11	)
Trust and investment services fees		37		38		37		39		41		(1	)		(3	)		(4	)		(10	)		112		118		(6	)		(5	)
Capital markets fees		34		35		22		15		21		(1	)		(3	)		13			62			91		73		10			12
Foreign exchange and letter of credit fees		23		21		21		23		22		2			10			1			5			65		67		(8	)		(11	)
Mortgage banking fees		33		25		18		20		18		8			32			15			83			76		81		9			13
Bank-owned life insurance income		14		13		13		16		14		1			8			—			—			40		40		—			—
Securities gains, net		—		4		9		10		2		(4	)		(100	)		(2	)		(100	)		13		19		(6	)		(32	)
Other income		90		18		16		23		30		72			NM			60			200			124		71		53			75

Total noninterest income		435		355		330		362		353		80			23			82			23			1,120		1,060		60			6

TOTAL REVENUE		1,380		1,278		1,234		1,232		1,209		102			8			171			14			3,892		3,592		300			8
Provision for credit losses		86		90		91		91		76		(4	)		(4	)		10			13			267		211		56			27
NONINTEREST EXPENSE:
Salaries and employee benefits		432		432		425		402		404		—			—			28			7			1,289		1,234		55			4
Outside services		102		86		91		104		89		16			19			13			15			279		267		12			4
Occupancy		78		76		76		74		75		2			3			3			4			230		245		(15	)		(6	)
Equipment expense		65		64		65		67		62		1			2			3			5			194		190		4			2
Amortization of software		46		41		39		38		35		5			12			11			31			126		108		18			17
Other operating expense		144		128		115		125		133		16			13			11			8			387		405		(18	)		(4	)

Total noninterest expense		867		827		811		810		798		40			5			69			9			2,505		2,449		56			2

Income before income tax expense		427		361		332		331		335		66			18			92			27			1,120		932		188			20
Income tax expense		130		118		109		110		115		12			10			15			13			357		313		44			14

NET INCOME	$	297	$	243	$	223	$	221	$	220	$	54			22	%	$	77			35	%	$	763	$	619	$	144			23	%

Net income, adjusted¹	$	278	$	243	$	223	$	221	$	220	$	35			14	%	$	58			26	%	$	744	$	650	$	94			14	%

Net income available to common stockholders	$	290	$	243	$	216	$	221	$	213	$	47			19	%	$	77			36	%	$	749	$	612	$	137			22	%

Net income available to common stockholders, adjusted¹	$	271	$	243	$	216	$	221	$	213	$	28			12	%	$	58			27	%	$	730	$	643	$	87			14	%

¹	These are non-GAAP financial measures. For further information on these measures, refer to pages 29-36

CONSOLIDATED BALANCE SHEETS (unaudited)

(dollars in millions)


PERIOD END BALANCES	AS OF															SEPT 30, 2016 CHANGE
	Sept 30, 2016			June 30, 2016			Mar 31, 2016			Dec 31, 2015			Sept 30, 2015			June 30, 2016						Sept 30, 2015
																$			%			$			%
ASSETS:
Cash and due from banks	$	915		$	976		$	839		$	1,099		$	1,067		($	61	)		(6	%)	($	152	)		(14	%)
Interest-bearing cash and due from banks		2,000			2,679			1,016			1,986			689			(679	)		(25	)		1,311			190
Interest-bearing deposits in banks		720			727			534			356			363			(7	)		(1	)		357			98
Securities available for sale, at fair value		19,425			18,479			17,964			17,884			18,197			946			5			1,228			7
Securities held to maturity		5,289			4,973			5,129			5,258			5,285			316			6			4			—
Other investment securities, at fair value		113			73			68			70			50			40			55			63			126
Other investment securities, at cost		877			873			896			863			822			4			—			55			7
Loans held for sale, at fair value		526			478			365			325			369			48			10			157			43
Other loans held for sale		—			372			386			40			51			(372	)		(100	)		(51	)		(100	)
Loans and leases		105,467			103,551			100,991			99,042			97,431			1,916			2			8,036			8
Less: Allowance for loan and lease losses		(1,240	)		(1,246	)		(1,224	)		(1,216	)		(1,201	)		6			—			(39	)		3

Net loans and leases		104,227			102,305			99,767			97,826			96,230			1,922			2			7,997			8
Derivative assets		1,102			1,312			1,068			625			838			(210	)		(16	)		264			32
Premises and equipment		540			551			570			595			560			(11	)		(2	)		(20	)		(4	)
Bank-owned life insurance		1,600			1,587			1,576			1,564			1,553			13			1			47			2
Goodwill		6,876			6,876			6,876			6,876			6,876			—			—			—			—
Due from broker		—			132			161			—			—			(132	)		(100	)		—			—
Other assets		2,805			2,790			2,862			2,841			2,497			15			1			308			12

TOTAL ASSETS	$	147,015		$	145,183		$	140,077		$	138,208		$	135,447		$	1,832			1	%	$	11,568			9	%

LIABILITIES AND STOCKHOLDERS’ EQUITY:
LIABILITIES:
Deposits:
Noninterest-bearing	$	27,292		$	27,108		$	27,186		$	27,649		$	27,373		$	184			1	%	($	81	)		—	%
Interest-bearing		81,035			79,149			75,420			74,890			74,493			1,886			2			6,542			9

Total deposits		108,327			106,257			102,606			102,539			101,866			2,070			2			6,461			6
Federal funds purchased and securities sold under agreements to repurchase		900			717			714			802			1,293			183			26			(393	)		(30	)
Other short-term borrowed funds		2,512			2,770			3,300			2,630			5,861			(258	)		(9	)		(3,349	)		(57	)
Derivative liabilities		840			1,010			832			485			641			(170	)		(17	)		199			31
Deferred taxes, net		994			961			852			730			637			33			3			357			56
Long-term borrowed funds		11,902			11,810			10,035			9,886			4,153			92			1			7,749			187
Due to broker		—			86			276			—			—			(86	)		(100	)		—			—
Other liabilities		1,359			1,346			1,497			1,490			1,396			13			1			(37	)		(3	)

TOTAL LIABILITIES		126,834			124,957			120,112			118,562			115,847			1,877			2			10,987			9
STOCKHOLDERS’ EQUITY:
Preferred stock:
$25.00 par value, 100,000,000 shares authorized		247			247			247			247			247			—			—			—			—
Common stock:
$0.01 par value, 1,000,000,000 shares authorized for each of the periods presented		6			6			6			6			6			—			—			—			—
Additional paid-in capital		18,740			18,735			18,730			18,725			18,718			5			—			22			—
Retained earnings		2,483			2,255			2,076			1,913			1,745			163			7			628			36
Treasury stock, at cost		(1,108	)		(858	)		(858	)		(858	)		(857	)		(250	)		29			(251	)		29
Accumulated other comprehensive loss		(187	)		(159	)		(236	)		(387	)		(259	)		(28	)		18			72			(28	)

TOTAL STOCKHOLDERS’ EQUITY		20,181			20,226			19,965			19,646			19,600			(45	)		—			581			3

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	147,015		$	145,183		$	140,077		$	138,208		$	135,447		$	1,832			1	%	$	11,568			9	%

Memo: Total tangible common equity	$	13,576		$	13,608		$	13,333		$	13,000		$	12,939		($	32	)		—	%	$	637			5	%

LOANS AND DEPOSITS

(dollars in millions)


PERIOD END BALANCES	AS OF										SEPT 30, 2016 CHANGE
	Sept 30, 2016		June 30, 2016		Mar 31, 2016		Dec 31, 2015		Sept 30, 2015		June 30, 2016						Sept 30, 2015
											$			%			$			%
LOANS AND LEASES:
Commercial	$	36,449	$	35,927	$	34,671	$	33,264	$	32,726	$	522			1	%	$	3,723			11	%
Commercial real estate		10,152		9,825		9,406		8,971		8,678		327			3			1,474			17
Leases		3,788		3,805		3,895		3,979		3,865		(17	)		—			(77	)		(2	)

Total commercial		50,389		49,557		47,972		46,214		45,269		832			2			5,120			11

Residential mortgages		14,602		13,855		13,345		13,318		12,792		747			5			1,810			14
Home equity loans		2,027		2,177		2,313		2,557		2,842		(150	)		(7	)		(815	)		(29	)
Home equity lines of credit		14,271		14,418		14,526		14,674		14,707		(147	)		(1	)		(436	)		(3	)
Home equity loans serviced by others¹		796		860		930		986		1,054		(64	)		(7	)		(258	)		(24	)
Home equity lines of credit serviced by others¹		238		273		339		389		441		(35	)		(13	)		(203	)		(46	)
Automobile		14,063		14,075		13,847		13,828		13,876		(12	)		—			187			1
Student		5,997		5,516		5,006		4,359		3,846		481			9			2,151			56
Credit card		1,644		1,613		1,581		1,634		1,628		31			2			16			1
Other retail		1,440		1,207		1,132		1,083		976		233			19			464			48

Total retail		55,078		53,994		53,019		52,828		52,162		1,084			2			2,916			6

Total loans and leases	$	105,467	$	103,551	$	100,991	$	99,042	$	97,431	$	1,916			2	%	$	8,036			8	%

Loans held for sale	$	526	$	478	$	365	$	325	$	369	$	48			10	%	$	157			43	%
Other loans held for sale²		—		372		386		40		51		(372	)		(100	)		(51	)		(100	)

Loans and loans held for sale	$	105,993	$	104,401	$	101,742	$	99,407	$	97,851	$	1,592			2	%	$	8,142			8	%

DEPOSITS:
Demand	$	27,292	$	27,108	$	27,186	$	27,649	$	27,373	$	184			1	%	($	81	)		—	%
Checking with interest		20,573		19,838		18,706		17,921		18,350		735			4			2,223			12
Regular savings		8,797		8,841		8,748		8,218		8,011		(44	)		—			786			10
Money market accounts		38,258		37,503		35,513		36,727		35,539		755			2			2,719			8
Term deposits		13,407		12,967		12,453		12,024		12,593		440			3			814			6

Total deposits	$	108,327	$	106,257	$	102,606	$	102,539	$	101,866	$	2,070			2		$	6,461			6

¹	Our Serviced by Others (“SBO”) portfolio consists of purchased loans and lines of credit that were originally serviced by others. We now service a portion of this portfolio internally.

²	During the third quarter of 2016 we sold a $310 million TDR loan portfolio, which was previously reported in other loans held for sale.

AVERAGE BALANCE SHEETS AND ANNUALIZED YIELDS

(dollars in millions)


AVERAGE BALANCES	QUARTERLY TRENDS																											FOR THE NINE MONTHS ENDED SEPT 30,
																3Q16 Change																		2016 Change
	3Q16			2Q16			1Q16			4Q15			3Q15			2Q16						3Q15						2016			2015			2015
																$			%			$			%									$			%
ASSETS:
Interest-bearing cash and due from banks and deposits in banks	$	2,121		$	1,948		$	1,675		$	1,526		$	1,322		$	173			9	%	$	799			60	%	$	1,915		$	1,820		$	95			5	%

Taxable investment securities		24,961			24,050			23,864			24,129			24,440			911			4			521			2			24,294			24,824			(530	)		(2	)
Non-taxable investment securities		8			9			9			9			9			(1	)		(11	)		(1	)		(11	)		9			10			(1	)		(10	)

Total investment securities		24,969			24,059			23,873			24,138			24,449			910			4			520			2			24,303			24,834			(531	)		(2	)

Investment securities and interest-bearing deposits		27,090			26,007			25,548			25,664			25,771			1,083			4			1,319			5			26,218			26,654			(436	)		(2	)

Commercial		35,986			35,622			34,018			33,080			32,832			364			1			3,154			10			35,212			32,536			2,676			8
Commercial real estate		9,905			9,649			9,108			8,855			8,406			256			3			1,499			18			9,555			8,020			1,535			19
Leases		3,813			3,863			3,917			3,884			3,936			(50	)		(1	)		(123	)		(3	)		3,864			3,909			(45	)		(1	)

Total commercial		49,704			49,134			47,043			45,819			45,174			570			1			4,530			10			48,631			44,465			4,166			9

Residential mortgages		14,155			13,491			13,465			13,030			12,470			664			5			1,685			14			13,705			12,104			1,601			13
Home equity loans		2,088			2,231			2,471			2,751			2,928			(143	)		(6	)		(840	)		(29	)		2,263			3,117			(854	)		(27	)
Home equity lines of credit		14,314			14,477			14,632			14,659			14,813			(163	)		(1	)		(499	)		(3	)		14,474			15,059			(585	)		(4	)
Home equity loans serviced by others¹		837			899			958			1,017			1,086			(62	)		(7	)		(249	)		(23	)		898			1,151			(253	)		(22	)
Home equity lines of credit serviced by others¹		256			299			340			375			425			(43	)		(14	)		(169	)		(40	)		298			479			(181	)		(38	)
Automobile		14,053			13,972			13,792			13,824			13,810			81			1			243			2			13,940			13,412			528			4
Student		5,750			5,407			4,852			4,052			3,530			343			6			2,220			63			5,338			3,064			2,274			74
Credit cards		1,623			1,600			1,601			1,625			1,616			23			1			7			—			1,608			1,620			(12	)		(1	)
Other retail		1,256			1,167			1,108			1,047			939			89			8			317			34			1,177			988			189			19

Total retail		54,332			53,543			53,219			52,380			51,617			789			1			2,715			5			53,701			50,994			2,707			5

Total loans and leases		104,036			102,677			100,262			98,199			96,791			1,359			1			7,245			7			102,332			95,459			6,873			7
Loans held for sale, at fair value		474			368			306			325			327			106			29			147			45			383			293			90			31
Other loans held for sale³		69			440			49			13			128			(371	)		(84	)		(59	)		(46	)		185			122			63			52

Interest-earning assets		131,669			129,492			126,165			124,201			123,017			2,177			2			8,652			7			129,118			122,528			6,590			5
Allowance for loan and lease losses		(1,243	)		(1,219	)		(1,212	)		(1,196	)		(1,197	)		(24	)		(2	)		(46	)		(4	)		(1,225	)		(1,196	)		(29	)		(2	)
Goodwill		6,876			6,876			6,876			6,876			6,876			—			—			—			—			6,876			6,876			—			—
Other noninterest-earning assets		7,097			7,030			6,951			6,417			6,407			67			1			690			11			7,026			6,447			579			9

Total noninterest-earning assets		12,730			12,687			12,615			12,097			12,086			43			—			644			5			12,677			12,127			550			5

TOTAL ASSETS	$	144,399		$	142,179		$	138,780		$	136,298		$	135,103		$	2,220			2	%	$	9,296			7	%	$	141,795		$	134,655		$	7,140			5	%

LIABILITIES AND STOCKHOLDERS’ EQUITY:
LIABILITIES:
Checking with interest	$	19,997		$	19,003		$	17,993		$	17,117		$	16,934		$	994			5	%	$	3,063			18	%	$	19,001		$	16,515		$	2,486			15	%
Money market and savings		46,376			44,949			44,619			44,575			44,572			1,427			3			1,804			4			45,319			43,082			2,237			5
Term deposits		12,806			12,581			12,199			12,201			12,730			225			2			76			1			12,530			12,498			32			—

Total interest-bearing deposits		79,179			76,533			74,811			73,893			74,236			2,646			3			4,943			7			76,850			72,095			4,755			7
Federal funds purchased and securities sold under agreements to repurchase²		910			974			881			1,635			2,880			(64	)		(7	)		(1,970	)		(68	)		922			3,947			(3,025	)		(77	)
Other short-term borrowed funds		2,564			3,743			3,098			4,964			5,062			(1,179	)		(31	)		(2,498	)		(49	)		3,133			6,169			(3,036	)		(49	)
Long-term borrowed funds		10,905			10,321			9,894			6,004			4,059			584			6			6,846			169			10,375			3,964			6,411			162

Total borrowed funds		14,379			15,038			13,873			12,603			12,001			(659	)		(4	)		2,378			20			14,430			14,080			350			2

Total interest-bearing liabilities		93,558			91,571			88,684			86,496			86,237			1,987			2			7,321			8			91,280			86,175			5,105			6
Total demand deposits		27,467			27,448			27,170			27,475			26,754			19			—			713			3			27,362			26,313			1,049			4
Other liabilities		3,317			3,145			3,112			2,721			2,604			172			5			713			27			3,191			2,654			537			20

TOTAL LIABILITIES		124,342			122,164			118,966			116,692			115,595			2,178			2			8,747			8			121,833			115,142			6,691			6

STOCKHOLDERS’ EQUITY		20,057			20,015			19,814			19,606			19,508			42			—			549			3			19,962			19,513			449			2

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	144,399		$	142,179		$	138,780		$	136,298		$	135,103		$	2,220			2	%	$	9,296			7	%	$	141,795		$	134,655		$	7,140			5	%

Memo: Total average tangible common equity	$	13,442		$	13,386		$	13,169		$	12,948		$	12,834		$	56			—	%	$	608			5	%	$	13,332		$	13,332		$	423			3	%

Total deposits (interest-bearing and demand)	$	106,646		$	103,981		$	101,981		$	101,368		$	100,990		$	2,665			3	%	$	5,656			6	%	$	104,212		$	98,408		$	5,804			6	%

¹	Our SBO portfolio consists of purchased loans and lines of credit that were originally serviced by others. We now service a portion of this portfolio internally.

²	Balances are net of certain short-term receivables associated with reverse repurchase agreements; interest expense includes the full cost of the repurchase agreements and certain hedging costs.

During the first half of 2016, certain troubled debt restructured loans were transferred from loans and leases to other loans held for sale. The average balances of troubled debt restructured loans held in other loans held for sale was $63 million and $140 million during the three and nine months ended September 30, 2016, respectively.

AVERAGE BALANCE SHEETS AND ANNUALIZED YIELDS, CONTINUED

(dollars in millions, except rates)


	QUARTERLY TRENDS																									FOR THE NINE MONTHS ENDED SEPT 30,
AVERAGE ANNUALIZED YIELDS & RATES	3Q16					2Q16					1Q16					4Q15					3Q15					2016					2015
	Rate			Income/ Expense		Rate			Income/ Expense		Rate			Income/ Expense		Rate			Income/ Expense		Rate			Income/ Expense		Rate			Income/ Expense		Rate			Income/ Expense
INTEREST-EARNING ASSETS:
Interest-bearing deposits in banks		0.41	%	$	2		0.39	%	$	2		0.42	%	$	2		0.41	%	$	1		0.44	%	$	2		0.40	%	$	6		0.26	%	$	4

Taxable investment securities		2.34			146		2.35			141		2.43			145		2.52			153		2.52			154		2.37			432		2.52			468
Non-taxable investment securities		2.60			—		2.60			—		2.60			—		2.60			—		2.60			—		2.60			—		2.60			—

Total investment securities		2.34			146		2.35			141		2.43			145		2.52			153		2.52			154		2.37			432		2.52			468

Investment securities and interest-bearing deposits					148					143					147					154					156					438					472

Commercial		3.14			290		3.09			278		3.08			264		2.92			247		2.89			243		3.10			832		2.85			704
Commercial real estate		2.82			71		2.74			67		2.69			62		2.49			56		2.50			54		2.75			200		2.54			155
Leases		2.43			23		2.45			24		2.44			24		2.44			23		2.45			24		2.44			71		2.51			74

Total commercial		3.02			384		2.97			369		2.95			350		2.80			326		2.78			321		2.98			1,103		2.77			933

Residential mortgages		3.59			127		3.61			122		3.76			126		3.77			123		3.76			117		3.65			375		3.77			342
Home equity loans		5.75			30		5.64			31		5.51			34		5.30			37		5.32			40		5.63			95		5.41			126
Home equity lines of credit		3.20			115		3.18			115		3.11			113		2.95			109		2.97			111		3.16			343		2.95			332
Home equity loans serviced by others¹		7.24			16		7.11			16		6.94			17		6.94			17		6.93			19		7.09			49		6.94			60
Home equity lines of credit serviced by others¹		2.47			2		2.02			1		2.19			2		2.40			2		2.30			3		2.21			5		2.45			9
Automobile		2.96			104		2.95			103		2.83			97		2.80			98		2.75			95		2.91			304		2.73			274
Student		5.10			73		5.07			69		5.02			60		4.97			51		5.01			45		5.06			202		5.09			116
Credit cards		11.24			46		11.18			44		11.29			45		10.91			45		10.95			44		11.24			135		10.99			133
Other retail		9.39			29		8.94			26		8.66			24		8.08			22		7.72			17		9.01			79		7.64			56

Total retail		3.98			542		3.95			527		3.91			518		3.82			504		3.79			491		3.95			1,587		3.80			1,448

Total loans and leases		3.52			926		3.48			896		3.46			868		3.34			830		3.32			812		3.49			2,690		3.32			2,381
Loans held for sale		3.35			4		3.41			3		3.70			3		3.44			2		3.69			3		3.46			10		3.48			8
Other loans held for sale		6.41			1		4.00			4		6.64			1		5.93			—		6.96			3		4.53			6		7.27			7

Total interest-earning assets		3.25			1,079		3.22			1,046		3.23			1,019		3.15			986		3.13			974		3.23			3,144		3.11			2,868
INTEREST-BEARING LIABILITIES:
Checking with interest		0.20		$	9		0.16		$	8		0.14		$	7		0.11			5		0.12			5		0.17			24		0.11			14
Money market and savings		0.31			37		0.29			32		0.26			29		0.27			30		0.29			33		0.29			98		0.27			87
Term deposits		0.76			25		0.74			23		0.80			24		0.84			25		0.84			27		0.77			72		0.81			76

Total interest-bearing deposits		0.36			71		0.33			63		0.32			60		0.33			60		0.34			65		0.34			194		0.33			177
Federal funds purchased and securities sold under agreements to repurchase²		0.24			1		0.19			—		0.23			1		0.64			3		0.52			4		0.22			2		0.44			13
Other short-term borrowed funds		1.54			10		1.25			12		1.40			11		1.26			16		1.32			17		1.38			33		1.09			51
Long-term borrowed funds		1.89			52		1.87			48		1.75			43		2.44			37		3.16			32		1.84			143		3.21			95

Total borrowed funds		1.72			63		1.60			60		1.58			55		1.74			56		1.75			53		1.63			178		1.50			159

Total interest-bearing liabilities		0.57			134		0.54			123		0.52			115		0.53			116		0.54			118		0.54			372		0.52			336
INTEREST RATE SPREAD		2.68	%				2.68	%				2.71	%				2.62	%				2.59	%				2.69	%				2.59	%
NET INTEREST MARGIN		2.84					2.84					2.86					2.77					2.76					2.85					2.75
Memo Total deposits costs		0.27			71		0.24			63		0.24			60		0.24			60		0.25			65		0.25			194		0.24			177

¹	Our SBO portfolio consists of purchased loans and lines of credit that were originally serviced by others. We now service a portion of this portfolio internally.

²	Balances are net of certain short-term receivables associated with reverse repurchase agreements; interest expense includes the full cost of the repurchase agreements and certain hedging costs.

SEGMENT FINANCIAL HIGHLIGHTS - CONSOLIDATING

(dollars in millions, except ratios)


	THIRD QUARTER 2016												SECOND QUARTER 2016												CHANGE
																									3Q16 from 2Q16
	Consumer Banking			Commercial Banking			Other¹			Consolidated			Consumer Banking			Commercial Banking			Other¹			Consolidated			$/bps			%
Net interest income	$	621		$	327		($	3	)	$	945		$	602		$	314		$	7		$	923		$	22			2	%
Noninterest income		229			123			83			435			219			122			14			355			80			23

Total revenue		850			450			80			1,380			821			436			21			1,278			102			8
Noninterest expense		650			181			36			867			632			186			9			827			40			5

Profit before provision for credit losses		200			269			44			513			189			250			12			451			62			14
Provision for credit losses		57			19			10			86			49			(1	)		42			90			(4	)		(4	)

Income (loss) before income tax expense (benefit)		143			250			34			427			140			251			(30	)		361			66			18
Income tax expense (benefit)		51			88			(9	)		130			50			87			(19	)		118			12			10

Net income (loss)	$	92		$	162		$	43		$	297		$	90		$	164		($	11	)	$	243		$	54			22	%

Average Balances
Total assets	$	56,689		$	47,902		$	39,808		$	144,399		$	55,660		$	47,388		$	39,131		$	142,179		$	2,220			2	%
Total loans and leases²		55,376			46,611			2,592			104,579			54,353			46,073			3,059			103,485			1,094			1
Deposits		72,141			27,847			6,658			106,646			71,863			25,113			7,005			103,981			2,665			3
Interest-earning assets		55,423			46,666			29,580			131,669			54,400			46,170			28,922			129,492			2,177			2
Key Metrics
Net interest margin		4.46	%		2.79	%		NM			2.84	%		4.45	%		2.74	%		NM			2.84	%		—	bps
Efficiency ratio		76.46			40.21			NM			62.88			76.98			42.88			NM			64.71			(183	) bps
Loans-to-deposits ratio (average balances)		76.76			167.38			NM			98.06			98.06			183.46			NM			99.52			(146	) bps
Return on average total tangible assets		0.64			4.35			NM			0.86			0.86			1.39			NM			0.72			14	bps
Return on average tangible common equity³		7.04			12.50			NM			8.58			8.58			13.04			NM			7.30			128	bps

Includes the financial impact of non-core, liquidating loan portfolios and other non-core assets, our treasury activities, wholesale funding activities, securities portfolio, community development assets and other unallocated assets, liabilities, revenues, provision for credit losses and expenses not attributed to our Consumer Banking or Commercial Banking segments.

²	Includes loans and leases held for sale.

³	Operating segments are allocated capital on a risk-adjusted basis considering economic and regulatory capital requirements.

SEGMENT FINANCIAL HIGHLIGHTS - CONSOLIDATING, (CONTINUED)

(dollars in millions, except ratios)


	THIRD QUARTER 2016												THIRD QUARTER 2015											CHANGE
																								3Q16 from 3Q15
	Consumer Banking			Commercial Banking			Other¹			Consolidated			Consumer Banking			Commercial Banking			Other¹		Consolidated			$/bps			%
Net interest income	$	621		$	327		($	3	)	$	945		$	556		$	299		$	1	$	856		$	89			10	%
Noninterest income		229			123			83			435			235			100			18		353			82			23

Total revenue		850			450			80			1,380			791			399			19		1,209			171			14
Noninterest expense		650			181			36			867			623			175			—		798			69			9

Profit before provision for credit losses		200			269			44			513			168			224			19		411			102			25
Provision for credit losses		57			19			10			86			64			3			9		76			10			13

Income (loss) before income tax expense (benefit)		143			250			34			427			104			221			10		335			92			27
Income tax expense (benefit)		51			88			(9	)		130			36			76			3		115			15			13

Net income (loss)	$	92		$	162		$	43		$	297		$	68		$	145		$	7	$	220		$	77			35	%

Average Balances
Total assets	$	56,689		$	47,902		$	39,808		$	144,399		$	53,206		$	43,113		$	38,784	$	135,103		$	9,296			7	%
Total loans and leases²		55,376			46,611			2,592			104,579			51,886			41,993			3,367		97,246			7,333			8
Deposits		72,141			27,847			6,658			106,646			70,527			24,604			5,859		100,990			5,656			6
Interest-earning assets		55,423			46,666			29,580			131,669			51,928			42,070			29,019		123,017			8,652			7
Key Metrics
Net interest margin		4.46	%		2.79	%		NM			2.84	%		4.25	%		2.81	%		NM		2.76	%		8	bps
Efficiency ratio		76.46			40.21			NM			62.88			78.72			43.75			NM		66.02			(314	) bps
Loans-to-deposits ratio (average balances)		76.76			167.38			NM			98.06			73.57			170.68			NM		96.29			177	bps
Return on average total tangible assets		0.64			4.35			NM			0.86			0.51			1.34			NM		0.68			18	bps
Return on average tangible common equity³		7.04			12.50			NM			8.58			5.67			12.24			NM		6.60			198	bps

²	Includes loans and leases held for sale.

³	Operating segments are allocated capital on a risk-adjusted basis considering economic and regulatory capital requirements.

SEGMENT FINANCIAL HIGHLIGHTS - CONSOLIDATING, (CONTINUED)

(dollars in millions, except ratios)


	NINE MONTHS ENDED SEPT 30, 2016												NINE MONTHS ENDED SEPT 30, 2015												CHANGE
																									2016 from 2015
	Consumer Banking			Commercial Banking			Other¹			Consolidated			Consumer Banking			Commercial Banking			Other¹			Consolidated			$/bps			%
Net interest income	$	1,804		$	941		$	27		$	2,772		$	1,633		$	861		$	38		$	2,532		$	240			9	%
Noninterest income		656			344			120			1,120			684			308			68			1,060			60			6

Total revenue		2,460			1,285			147			3,892			2,317			1,169			106			3,592			300			8
Noninterest expense		1,898			554			53			2,505			1,832			529			88			2,449			56			2

Profit before provision for credit losses		562			731			94			1,387			485			640			18			1,143			244			21
Provision for credit losses		169			27			71			267			187			(11	)		35			211			56			27

Income (loss) before income tax expense (benefit)		393			704			23			1,120			298			651			(17	)		932			188			20
Income tax expense (benefit)		140			245			(28	)		357			103			224			(14	)		313			44			14

Net income (loss)	$	253		$	459		$	51		$	763		$	195		$	427		($	3	)	$	619		$	144			23	%

Average Balances
Total assets	$	55,825		$	46,869		$	39,101		$	141,795		$	52,438		$	42,451		$	39,766		$	134,655		$	7,140			5	%
Total loans and leases²		54,494			45,532			2,874			102,900			51,062			41,240			3,572			95,874			7,026			7
Deposits		71,627			25,938			6,647			104,212			69,347			23,094			5,967			98,408			5,804			6
Interest-earning assets		54,542			45,611			28,965			129,118			51,100			41,323			30,105			122,528			6,590			5
Key Metrics
Net interest margin		4.42	%		2.76	%		NM			2.85	%		4.27	%		2.78	%		NM			2.75	%		10	bps
Efficiency ratio		77.15			43.15			NM			64.36			79.07			45.26			NM			68.17			(381	) bps
Loans-to-deposits ratio (average balances)		76.08			175.54			NM			98.74			73.63			178.58			NM			97.43			131	bps
Return on average total tangible assets		0.60			1.31			NM			0.75			0.50			1.35			NM			0.65			10	bps
Return on average tangible common equity³		6.58			12.27			NM			7.51			5.55			12.35			NM			6.34			117	bps

²	Includes loans and leases held for sale.

³	Operating segments are allocated capital on a risk-adjusted basis considering economic and regulatory capital requirements.

SEGMENT FINANCIAL HIGHLIGHTS - CONSUMER BANKING

(dollars in millions, except ratios)


	QUARTERLY TRENDS																											FOR THE NINE MONTHS ENDED SEPT 30,
CONSUMER BANKING																3Q16 Change																		2016 Change
	3Q16			2Q16			1Q16			4Q15			3Q15			2Q16						3Q15						2016			2015			2015
																$/bps			%			$/bps			%									$/bps			%
Net interest income	$	621		$	602		$	581		$	565		$	556		$	19			3	%	$	65			12	%	$	1,804		$	1,633		$	171			10	%
Noninterest income		229			219			208			226			235			10			5			(6	)		(3	)		656			684			(28	)		(4	)

Total revenue		850			821			789			791			791			29			4			59			7			2,460			2,317			143			6
Noninterest expense		650			632			616			624			623			18			3			27			4			1,898			1,832			66			4

Profit before provision for credit losses		200			189			173			167			168			11			6			32			19			562			485			77			16
Provision for credit losses		57			49			63			65			64			8			16			(7	)		(11	)		169			187			(18	)		(10	)

Income (loss) before income tax expense (benefit)		143			140			110			102			104			3			2			39			38			393			298			95			32
Income tax expense (benefit)		51			50			39			35			36			1			2			15			42			140			103			37			36

Net income (loss)	$	92		$	90		$	71		$	67		$	68		$	2			2	%	$	24			35	%	$	253		$	195		$	58			30	%

Average Balances
Total assets	$	56,689		$	55,660		$	55,116		$	54,065		$	53,206		$	1,029			2	%	$	3,483			7	%	$	55,825		$	52,438		$	3,387			6	%
Total loans and leases¹		55,376			54,353			53,744			52,737			51,886			1,023			2			3,490			7			54,494			51,062			3,432			7
Deposits		72,141			71,863			70,871			70,939			70,527			278			—			1,614			2			71,627			69,347			2,280			3
Interest-earning assets		55,423			54,400			53,793			52,785			51,928			1,023			2			3,495			7			54,542			51,100			3,442			7
Key Metrics
Net interest margin		4.46	%		4.45	%		4.35	%		4.25	%		4.25	%		1	bps					21	bps					4.42	%		4.27	%		15	bps
Efficiency ratio		76.46			76.98			78.08			78.85			78.72			(52	) bps					(226	) bps					77.15			79.07			(192	) bps
Loans-to-deposits ratio (average balances)		76.76			75.63			75.83			74.34			73.57			113	bps					319	bps					76.08			73.63			245	bps
Return on average total tangible assets		0.64			0.65			0.52			0.49			0.51			(1	) bps					13	bps					0.60			0.50			10	bps
Return on average tangible common equity²		7.04			7.09			5.59			5.50			5.67			(5	) bps					137	bps					6.58			5.55			103	bps

¹	Includes loans and leases held for sale.

²	Operating segments are allocated capital on a risk-adjusted basis considering economic and regulatory capital requirements.

SEGMENT FINANCIAL HIGHLIGHTS - COMMERCIAL BANKING

(dollars in millions, except ratios)


	QUARTERLY TRENDS																											FOR THE NINE MONTHS ENDED SEPT 30,
COMMERCIAL BANKING																3Q16 Change																		2016 Change
	3Q16			2Q16			1Q16			4Q15			3Q15			2Q16						3Q15						2016			2015			2015
																$/bps			%			$/bps			%									$/bps			%
Net interest income	$	327		$	314		$	300		$	301		$	299		$	13			4	%	$	28			9	%	$	941		$	861		$	80			9	%
Noninterest income		123			122			99			107			100			1			1			23			23			344			308			36			12

Total revenue		450			436			399			408			399			14			3			51			13			1,285			1,169			116			10
Noninterest expense		181			186			187			180			175			(5	)		(3	)		6			3			554			529			25			5

Profit before provision for credit losses		269			250			212			228			224			19			8			45			20			731			640			91			14
Provision for credit losses		19			(1	)		9			(2	)		3			20			NM			16			NM			27			(11	)		38			NM

Income (loss) before income tax expense (benefit)		250			251			203			230			221			(1	)		—			29			13			704			651			53			8
Income tax expense (benefit)		88			87			70			78			76			1			1			12			16			245			224			21			9

Net income (loss)	$	162		$	164		$	133		$	152		$	145		($	2	)		(1	%)	$	17			12	%	$	459		$	427		$	32			7	%

Average Balances
Total assets	$	47,902		$	47,388		$	45,304		$	43,835		$	43,113		$	514			1	%	$	4,789			11	%	$	46,869		$	42,451		$	4,418			10	%
Total loans and leases¹		46,611			46,073			43,899			42,642			41,993			538			1			4,618			11			45,532			41,240			4,292			10
Deposits		27,847			25,113			24,833			24,600			24,604			2,734			11			3,243			13			25,938			23,094			2,844			12
Interest-earning assets		46,666			46,170			43,987			42,777			42,070			496			1			4,596			11			45,611			41,323			4,288			10
Key Metrics
Net interest margin		2.79	%		2.74	%		2.74	%		2.80	%		2.81	%		5	bps					(2	) bps					2.76	%		2.78	%		(2	) bps
Efficiency ratio		40.21			42.88			46.74			44.02			43.75			(267	) bps					(354	) bps					43.15			45.26			(211	) bps
Loans-to-deposits ratio (average balances)		167.38			183.46			176.78			173.34			170.68			(1,608	) bps					(330	) bps					175.54			178.58			(304	) bps
Return on average total tangible assets		1.35			1.39			1.18			1.37			1.34			(4	) bps					1	bps					1.31			1.35			(4	) bps
Return on average tangible common equity²		12.50			13.04			11.19			12.57			12.24			(54	) bps					26	bps					12.27			12.35			(8	) bps

¹	Includes loans and leases held for sale.

²	Operating segments are allocated capital on a risk-adjusted basis considering economic and regulatory capital requirements.

SEGMENT FINANCIAL HIGHLIGHTS - OTHER

(dollars in millions)


	QUARTERLY TRENDS																									FOR THE NINE MONTHS ENDED SEPT 30,
OTHER¹														3Q16 Change																		2016 Change
	3Q16			2Q16			1Q16		4Q15			3Q15		2Q16						3Q15						2016			2015			2015
														$			%			$			%									$			%
Net interest income	($	3	)	$	7		$	23	$	4		$	1	($	10	)		(143	%)	($	4	)		NM		$	27		$	38		($	11	)		(29	%)
Noninterest income		83			14			23		29			18		69			NM			65			NM			120			68			52			76

Total revenue		80			21			46		33			19		59			NM			61			NM			147			106			41			39
Noninterest expense		36			9			8		6			—		27			NM			36			100			53			88			(35	)		(40	)

Profit before provision for credit losses		44			12			38		27			19		32			NM			25			132			94			18			76			NM
Provision for credit losses		10			42			19		28			9		(32	)		(76	)		1			11			71			35			36			103

Income (loss) before income tax expense (benefit)		34			(30	)		19		(1	)		10		64			213			24			240			23			(17	)		40			235
Income tax expense (benefit)		(9	)		(19	)		—		(3	)		3		10			53			(12	)		NM			(28	)		(14	)		(14	)		(100	)

Net income (loss)	$	43		($	11	)	$	19	$	2		$	7	$	54			NM		$	36			NM		$	51		($	3	)	$	54			NM

Average Balances
Total assets	$	39,808		$	39,131		$	38,360	$	38,398		$	38,784	$	677			2	%	$	1,024			3	%	$	39,101		$	39,766		($	665	)		(2	%)
Total loans and leases		2,592			3,059			2,974		3,158			3,367		(467	)		(15	)		(775	)		(23	)		2,874			3,572			(698	)		(20	)
Deposits		6,658			7,005			6,277		5,829			5,859		(347	)		(5	)		799			14			6,647			5,967			680			11
Interest-earning assets		29,580			28,922			28,385		28,639			29,019		658			2			561			2			28,965			30,105			(1,140	)		(4	)

SEGMENT FINANCIAL HIGHLIGHTS - CONSOLIDATED

(dollars in millions, except ratios)


	QUARTERLY TRENDS																											FOR THE NINE MONTHS ENDED SEPT 30,
CONSOLIDATED																3Q16 Change																		2016 Change
	3Q16			2Q16			1Q16			4Q15			3Q15			2Q16						3Q15						2016			2015			2015
																$/bps			%			$/bps			%									$/bps			%
Net interest income	$	945		$	923		$	904		$	870		$	856		$	22			2	%	$	89			10	%	$	2,772		$	2,532		$	240			9	%
Noninterest income		435			355			330			362			353			80			23			82			23			1,120			1,060			60			6

Total revenue		1,380			1,278			1,234			1,232			1,209			102			8			171			14			3,892			3,592			300			8
Noninterest expense		867			827			811			810			798			40			5			69			9			2,505			2,449			56			2

Profit before provision for credit losses		513			451			423			422			411			62			14			102			25			1,387			1,143			244			21
Provision for credit losses		86			90			91			91			76			(4	)		(4	)		10			13			267			211			56			27

Income (loss) before income tax expense (benefit)		427			361			332			331			335			66			18			92			27			1,120			932			188			20
Income tax expense (benefit)		130			118			109			110			115			12			10			15			13			357			313			44			14

Net income (loss)	$	297		$	243		$	223		$	221		$	220		$	54			22	%	$	77			35	%	$	763		$	619		$	144			23	%

Average Balances
Total assets	$	144,399		$	142,179		$	138,780		$	136,298		$	135,103		$	2,220			2	%	$	9,296			7	%	$	141,795		$	134,655		$	7,140			5	%
Total loans and leases¹		104,579			103,485			100,617			98,537			97,246			1,094			1			7,333			8			102,900			95,874			7,026			7
Deposits		106,646			103,981			101,981			101,368			100,990			2,665			3			5,656			6			104,212			98,408			5,804			6
Interest-earning assets		131,669			129,492			126,165			124,201			123,017			2,177			2			8,652			7			129,118			122,528			6,590			5
Key Metrics
Net interest margin		2.84	%		2.84	%		2.86	%		2.77	%		2.76	%		—	bps					8	bps					2.85	%		2.75	%		10	bps
Efficiency ratio		62.88			64.71			65.66			65.76			66.02			(183	) bps					(314	) bps					64.36			68.17			(381	) bps
Loans-to-deposits ratio (average balances)		98.06			99.52			98.66			97.21			96.29			(146	) bps					177	bps					98.74			97.43			131	bps
Return on average total tangible assets		0.86			0.72			0.68			0.67			0.68			14	bps					18	bps					0.75			0.65			10	bps
Return on average tangible common equity		8.58			7.30			6.61			6.75			6.60			128	bps					198	bps					7.51			6.34			117	bps

¹	Includes loans and leases held for sale.

SEGMENT FINANCIAL HIGHLIGHTS

(dollars in millions)


	QUARTERLY TRENDS																							FOR THE NINE MONTHS ENDED SEPT 30,
												3Q16 Change																2016 Change
	3Q16			2Q16		1Q16		4Q15		3Q15		2Q16						3Q15						2016		2015		2015
												$			%			$			%							$			%
Net interest income:
Consumer Banking	$	621		$	602	$	581	$	565	$	556	$	19			3	%	$	65			12	%	$	1,804	$	1,633	$	171			10	%
Commercial Banking		327			314		300		301		299		13			4			28			9			941		861		80			9
Other		(3	)		7		23		4		1		(10	)		(143	)		(4	)		NM			27		38		(11	)		(29	)

Net interest income	$	945		$	923	$	904	$	870	$	856	$	22			2	%	$	89			10	%	$	2,772	$	2,532	$	240			9	%

Noninterest income:
Consumer Banking	$	229		$	219	$	208	$	226	$	235	$	10			5	%	($	6	)		(3	%)	$	656	$	684	($	28	)		(4	%)
Commercial Banking		123			122		99		107		100		1			1			23			23			344		308		36			12
Other		83			14		23		29		18		69			NM			65			NM			120		68		52			76

Noninterest income	$	435		$	355	$	330	$	362	$	353	$	80			23	%	$	82			23	%	$	1,120	$	1,060	$	60			6	%

Total revenue:
Consumer Banking	$	850		$	821	$	789	$	791	$	791	$	29			4	%	$	59			7	%	$	2,460	$	2,317	$	143			6	%
Commercial Banking		450			436		399		408		399		14			3			51			13			1,285		1,169		116			10
Other		80			21		46		33		19		59			NM			61			NM			147		106		41			39

Total revenue	$	1,380		$	1,278	$	1,234	$	1,232	$	1,209	$	102			8	%	$	171			14	%	$	3,892	$	3,592	$	300			8	%

Noninterest expense:
Consumer Banking	$	650		$	632	$	616	$	624	$	623	$	18			3	%	$	27			4	%	$	1,898	$	1,832	$	66			4	%
Commercial Banking		181			186		187		180		175		(5	)		(3	)		6			3			554		529		25			5
Other		36			9		8		6		—		27			NM			36			100			53		88		(35	)		(40	)

Noninterest expense	$	867		$	827	$	811	$	810	$	798	$	40			5	%	$	69			9	%	$	2,505	$	2,449	$	56			2	%

Profit before provision for credit losses:
Consumer Banking	$	200		$	189	$	173	$	167	$	168	$	11			6	%	$	32			19	%	$	562	$	485	$	77			16	%
Commercial Banking		269			250		212		228		224		19			8			45			20			731		640		91			14
Other		44			12		38		27		19		32			NM			25			132			94		18		76			NM

Profit before provision for credit losses	$	513		$	451	$	423	$	422	$	411	$	62			14	%	$	102			25	%	$	1,387	$	1,143	$	244			21	%

SEGMENT FINANCIAL HIGHLIGHTS, CONTINUED

(dollars in millions)


	QUARTERLY TRENDS																									FOR THE NINE MONTHS ENDED SEPT 30,
														3Q16 Change																		2016 Change
	3Q16			2Q16			1Q16		4Q15			3Q15		2Q16						3Q15						2016			2015			2015
														$			%			$			%									$			%
Provision for credit losses:
Consumer Banking	$	57		$	49		$	63	$	65		$	64	$	8			16	%	($	7	)		(11	%)	$	169		$	187		($	18	)		(10	%)
Commercial Banking		19			(1	)		9		(2	)		3		20			NM			16			NM			27			(11	)		38			NM
Other		10			42			19		28			9		(32	)		(76	)		1			11			71			35			36			103

Provision for credit losses	$	86		$	90		$	91	$	91		$	76	($	4	)		(4	)%	$	10			13	%	$	267		$	211		$	56			27	%

Income before income tax expense:
Consumer Banking	$	143		$	140		$	110	$	102		$	104	$	3			2	%	$	39			38	%	$	393		$	298		$	95			32	%
Commercial Banking		250			251			203		230			221		(1	)		—			29			13			704			651			53			8
Other		34			(30	)		19		(1	)		10		64			213			24			240			23			(17	)		40			235

Income before income tax expense	$	427		$	361		$	332	$	331		$	335	$	66			18	%	$	92			27	%	$	1,120		$	932		$	188			20	%

Income tax expense:
Consumer Banking	$	51		$	50		$	39	$	35		$	36	$	1			2	%	$	15			42	%	$	140		$	103		$	37			36	%
Commercial Banking		88			87			70		78			76		1			1			12			16			245			224			21			9
Other		(9	)		(19	)		—		(3	)		3		10			53			(12	)		NM			(28	)		(14	)		(14	)		(100	)

Income tax expense	$	130		$	118		$	109	$	110		$	115	$	12			10	%	$	15			13	%	$	357		$	313		$	44			14	%

Net income:
Consumer Banking	$	92		$	90		$	71	$	67		$	68	$	2			2	%	$	24			35	%	$	253		$	195		$	58			30	%
Commercial Banking		162			164			133		152			145		(2	)		(1	)		17			12			459			427			32			7
Other		43			(11	)		19		2			7		54			NM			36			NM			51			(3	)		54			NM

Net income	$	297		$	243		$	223	$	221		$	220	$	54			22	%	$	77			35	%	$	763		$	619		$	144			23	%

SEGMENT FINANCIAL HIGHLIGHTS, CONTINUED

(dollars in millions)


	QUARTERLY TRENDS																						FOR THE NINE MONTHS ENDED SEPT 30,
AVERAGE BALANCES											3Q16 Change																2016 Change
	3Q16		2Q16		1Q16		4Q15		3Q15		2Q16						3Q15						2016		2015		2015
											$			%			$			%							$			%
Total assets:
Consumer Banking	$	56,689	$	55,660	$	55,116	$	54,065	$	53,206	$	1,029			2	%	$	3,483			7	%	$	55,825	$	52,438	$	3,387			6	%
Commercial Banking		47,902		47,388		45,304		43,835		43,113		514			1			4,789			11			46,869		42,451		4,418			10
Other		39,808		39,131		38,360		38,398		38,784		677			2			1,024			3			39,101		39,766		(665	)		(2	)

Total Assets	$	144,399	$	142,179	$	138,780	$	136,298	$	135,103	$	2,220			2	%	$	9,296			7	%	$	141,795	$	134,655	$	7,140			5	%

Loans and leases¹:
Consumer Banking	$	55,376	$	54,353	$	53,744	$	52,737	$	51,886	$	1,023			2	%	$	3,490			7	%	$	54,494	$	51,062	$	3,432			7	%
Commercial Banking		46,611		46,073		43,899		42,642		41,993		538			1			4,618			11			45,532		41,240		4,292			10
Other		2,592		3,059		2,974		3,158		3,367		(467	)		(15	)		(775	)		(23	)		2,874		3,572		(698	)		(20	)

Total loans and leases	$	104,579	$	103,485	$	100,617	$	98,537	$	97,246	$	1,094			1	%	$	7,333			8	%	$	102,900	$	95,874	$	7,026			7	%

Deposits:
Consumer Banking	$	72,141	$	71,863	$	70,871	$	70,939	$	70,527	$	278			—	%	$	1,614			2	%	$	71,627	$	69,347	$	2,280			3	%
Commercial Banking		27,847		25,113		24,833		24,600		24,604		2,734			11			3,243			13			25,938		23,094		2,844			12
Other		6,658		7,005		6,277		5,829		5,859		(347	)		(5	)		799			14			6,647		5,967		680			11

Total deposits	$	106,646	$	103,981	$	101,981	$	101,368	$	100,990	$	2,665			3	%	$	5,656			6	%	$	104,212	$	98,408	$	5,804			6	%

Interest-earning assets:
Consumer Banking	$	55,423	$	54,400	$	53,793	$	52,785	$	51,928	$	1,023			2	%	$	3,495			7	%	$	54,542	$	51,100	$	3,442			7	%
Commercial Banking		46,666		46,170		43,987		42,777		42,070		496			1			4,596			11			45,611		41,323		4,288			10
Other		29,580		28,922		28,385		28,639		29,019		658			2			561			2			28,965		30,105		(1,140	)		(4	)

Total interest-earning assets	$	131,669	$	129,492	$	126,165	$	124,201	$	123,017	$	2,177			2	%	$	8,652			7	%	$	129,118	$	122,528	$	6,590			5	%

¹	Includes loans and leases held for sale.

SEGMENT FINANCIAL HIGHLIGHTS, CONTINUED


	QUARTERLY TRENDS																					FOR THE NINE MONTHS ENDED SEPTEMBER 30,
KEY METRICS																3Q16 Change												2016 Change
	3Q16			2Q16			1Q16			4Q15			3Q15			2Q16			3Q15			2016			2015			2015
																bps			bps									bps
Net Interest Margin (NIM)
Consumer Banking		4.46	%		4.45	%		4.35	%		4.25	%		4.25	%		1			21			4.42	%		4.27	%		15
Commercial Banking		2.79			2.74			2.74			2.80			2.81			5			(2	)		2.76			2.78			(2	)
Other		NM			NM			NM			NM			NM			—			—			NM			NM			—
NIM		2.84			2.84			2.86			2.77			2.76			—			8			2.85			2.75			10
Efficiency Ratio
Consumer Banking		76.46	%		76.98	%		78.08	%		78.85	%		78.72	%		(52	)		(226	)		77.15	%		79.07	%		(192	)
Commercial Banking		40.21			42.88			46.74			44.02			43.75			(267	)		(354	)		43.15			45.26			(211	)
Other		NM			NM			NM			NM			NM			—			—			NM			NM			—
Efficiency Ratio		62.88			64.71			65.66			65.76			66.02			(183	)		(314	)		64.36			68.17			(381	)
Loans-to-Deposits Ratio (average balance) (LDR)¹
Consumer Banking		76.76	%		75.63	%		75.83	%		74.34	%		73.57	%		113			319			76.08	%		73.63	%		245
Commercial Banking		167.38			183.46			176.78			173.34			170.68			(1,608	)		(330	)		175.54			178.58			(304	)
Other		NM			NM			NM			NM			NM			—			—			NM			NM			—
LDR		98.06			99.52			98.66			97.21			96.29			(146	)		177			98.74			97.43			131
Return on Average Tangible Assets (ROTA)
Consumer Banking		0.64	%		0.65	%		0.52	%		0.49	%		0.51	%		(1	)		13			0.60	%		0.50	%		10
Commercial Banking		1.35			1.39			1.18			1.37			1.34			(4	)		1			1.31			1.35			(4	)
Other		NM			NM			NM			NM			NM			—			—			NM			NM			—
ROTA		0.86			0.72			0.68			0.67			0.68			14			18			0.75			0.65			10
Return on Average Tangible Common Equity (ROTCE)²
Consumer Banking		7.04	%		7.09	%		5.59	%		5.50	%		5.67	%		(5	)		137			6.58	%		5.55	%		103
Commercial Banking		12.50			13.04			11.19			12.57			12.24			(54	)		26			12.27			12.35			(8	)
Other		NM			NM			NM			NM			NM			—			—			NM			NM			—
ROTCE		8.58			7.30			6.61			6.75			6.60			128			198			7.51			6.34			117

¹	Includes loans and leases held for sale.

²	Operating segments are allocated capital on a risk-adjusted basis considering economic and regulatory capital requirements.

CREDIT-RELATED INFORMATION

(dollars in millions)


	AS OF										SEPT 30, 2016 CHANGE
	Sept 30, 2016		June 30, 2016		Mar 31, 2016		Dec 31, 2015		Sept 30, 2015		June 30, 2016						Sept 30, 2015
											$			%			$			%
CREDIT EXPOSURE:
Commercial	$	36,449	$	35,927	$	34,671	$	33,264	$	32,726	$	522			1	%	$	3,723			11	%
Commercial real estate		10,152		9,825		9,406		8,971		8,678		327			3			1,474			17
Leases		3,788		3,805		3,895		3,979		3,865		(17	)		—			(77	)		(2	)

Total commercial		50,389		49,557		47,972		46,214		45,269		832			2			5,120			11
Residential mortgages		14,602		13,855		13,345		13,318		12,792		747			5			1,810			14
Home equity loans		2,027		2,177		2,313		2,557		2,842		(150	)		(7	)		(815	)		(29	)
Home equity lines of credit		14,271		14,418		14,526		14,674		14,707		(147	)		(1	)		(436	)		(3	)
Home equity loans serviced by others¹		796		860		930		986		1,054		(64	)		(7	)		(258	)		(24	)
Home equity lines of credit serviced by others¹		238		273		339		389		441		(35	)		(13	)		(203	)		(46	)
Automobile		14,063		14,075		13,847		13,828		13,876		(12	)		—			187			1
Student		5,997		5,516		5,006		4,359		3,846		481			9			2,151			56
Credit card		1,644		1,613		1,581		1,634		1,628		31			2			16			1
Other retail		1,440		1,207		1,132		1,083		976		233			19			464			48

Total retail		55,078		53,994		53,019		52,828		52,162		1,084			2			2,916			6

Total loans and leases		105,467		103,551		100,991		99,042		97,431		1,916			2			8,036			8
Derivative receivable - commercial		1,084		1,297		1,057		619		828		(213	)		(16	)		256			31
Derivative receivable - retail		18		15		11		6		10		3			20			8			80

Total derivative receivable		1,102		1,312		1,068		625		838		(210	)		(16	)		264			32

Total credit-related assets		106,569		104,863		102,059		99,667		98,269		1,706			2			8,300			8
Undrawn commitments to extend credit - commercial		32,991		32,018		30,352		30,823		29,751		973			3			3,240			11
Financial standby letters of credit		1,980		1,946		1,921		2,010		2,077		34			2			(97	)		(5	)
Performance letters of credit		40		37		41		42		45		3			8			(5	)		(11	)
Commercial letters of credit		55		70		63		87		63		(15	)		(21	)		(8	)		(13	)
Marketing rights		44		46		47		47		47		(2	)		(4	)		(3	)		(6	)
Risk participation agreements		51		64		53		26		39		(13	)		(20	)		12			31

Total commercial lending-related arrangements		35,161		34,181		32,477		33,035		32,022		980			3			3,139			10
Undrawn commitments to extend credit - retail		27,134		26,604		26,637		25,701		25,755		530			2			1,379			5
Residential mortgage loans sold with recourse		9		9		10		10		11		—			—			(2	)		(18	)

Total retail lending-related arrangements		27,143		26,613		26,647		25,711		25,766		530			2			1,377			5

Total lending-related arrangements		62,304		60,794		59,124		58,746		57,788		1,510			2			4,516			8

Total credit exposure	$	168,873	$	165,657	$	161,183	$	158,413	$	156,057	$	3,216			2	%	$	12,816			8	%

Memo: Total credit exposure by product category
Commercial exposure	$	86,634	$	85,035	$	81,506	$	79,868	$	78,119	$	1,599			2	%	$	8,515			11	%
Retail exposure		82,239		80,622		79,677		78,545		77,938		1,617			2			4,301			6

Total credit exposure	$	168,873	$	165,657	$	161,183	$	158,413	$	156,057	$	3,216			2	%	$	12,816			8	%

¹	Our SBO portfolio consists of purchased loans and lines of credit that were originally serviced by others. We now service a portion of this portfolio internally.

CREDIT-RELATED INFORMATION, CONTINUED

(dollars in millions, except ratios)


	AS OF															SEPT 30, 2016 CHANGE
	Sept 30, 2016			June 30, 2016			Mar 31, 2016			Dec 31, 2015			Sept 30, 2015			June 30, 2016						Sept 30, 2015
																$/bps			%			$/bps			%
NONPERFORMING ASSETS:
Commercial	$	334		$	277		$	284		$	71		$	88		$	57			21	%	$	246			NM
Commercial real estate		62			70			86			77			42			(8	)		(11	)		20			48
Leases		—			—			—			—			—			—			—			—			—

Total commercial		396			347			370			148			130			49			14			266			205
Residential mortgages²		170			174			174			331			324			(4	)		(2	)		(154	)		(48	)
Home equity loans³		105			104			99			135			144			1			1			(39	)		(27	)
Home equity lines of credit³		249			251			261			272			270			(2	)		(1	)		(21	)		(8	)
Home equity loans serviced by others⁴		32			33			37			38			39			(1	)		(3	)		(7	)		(18	)
Home equity lines of credit serviced by others⁴		42			38			38			32			31			4			11			11			35
Automobile		55			43			42			42			38			12			28			17			45
Student		38			37			40			41			39			1			3			(1	)		(3	)
Credit card		16			14			16			16			15			2			14			1			7
Other retail		4			3			2			5			4			1			33			—			—

Total retail		711			697			709			912			904			14			2			(193	)		(21	)

Nonperforming loans and leases¹		1,107			1,044			1,079			1,060			1,034			63			6			73			7

Accruing loans past due 90 days or more not included above	$	24		$	26		$	32		$	—		$	—
Accruing loans past due 90 days or more included above		—			—			—			9			15
Commercial	$	—		$	1		$	1		$	1		$	1		($	1	)		(100	%)	($	1	)		(100	%)
Retail		49			47			47			45			38			2			4			11			29

Other nonperforming assets		49			48			48			46			39			1			2			10			26

Nonperforming assets	$	1,156		$	1,092		$	1,127		$	1,106		$	1,073		$	64			6	%	$	83			8	%

NONPERFORMING ASSETS BY PRODUCT CATEGORY:
Commercial	$	396		$	348		$	371		$	149		$	131		$	48			14	%	$	265			202	%
Retail		760			744			756			957			942			16			2			(182	)		(19	)

Nonperforming assets	$	1,156		$	1,092		$	1,127		$	1,106		$	1,073		$	64			6	%	$	83			8	%

ASSET QUALITY RATIOS
Allowance for loan and lease losses to loans and leases		1.18	%		1.20	%		1.21	%		1.23	%		1.23	%		(2	) bps					(5	) bps
Allowance for loan and lease losses to nonperforming loans and leases¹		112.03			119.27			113.43			114.64			116.12			(724	) bps					(409	) bps
Nonperforming loans and leases to loans and leases¹		1.05			1.01			1.07			1.07			1.06			4	bps					(1	) bps
Nonperforming assets to total assets¹		0.79			0.75			0.80			0.80			0.79			4	bps					—	bps

¹	Nonperforming loans and leases included loans and leases on nonaccrual. Nonperforming loans and leases for periods prior to March 31, 2016 included loans and leases on nonaccrual and loans and leases accruing and 90 days or more past due.

Nonperforming balances at September 30, 2016 excluded $16 million of first lien residential mortgage loans that are 100% guaranteed by the Federal Housing Administration and $32 million of guaranteed residential mortgage loans sold to GNMA for which the Company has the right but not the obligation to repurchase.

³	Restated September 30, 2015 to conform to the current presentation.

⁴	Our SBO portfolio consists of purchased loans and lines of credit that were originally serviced by others. We now service a portion of this portfolio internally.

CREDIT-RELATED INFORMATION, CONTINUED

(dollars in millions)


	QUARTERLY TRENDS																											FOR THE NINE MONTHS ENDED SEPT 30,
CHARGE-OFFS, RECOVERIES AND RELATED RATIOS																3Q16 Change																		2016 Change
	3Q16			2Q16			1Q16			4Q15			3Q15			2Q16						3Q15						2016			2015			2015
																$			%			$			%									$			%
GROSS CHARGE-OFFS:
Commercial	$	20		$	4		$	13		$	3		$	10		$	16			NM		$	10			100	%	$	37		$	27		$	10			37	%
Commercial real estate		10			3			—			1			1			7			233			9			NM			13			5			8			160
Leases		3			—			—			—			—			3			100			3			100			3			—			3			100

Total commercial		33			7			13			4			11			26			NM			22			200			53			32			21			66
Residential mortgages		4			5			6			5			5			(1	)		(20	)		(1	)		(20	)		15			17			(2	)		(12	)
Home equity loans		7			3			3			11			8			4			133			(1	)		(13	)		13			23			(10	)		(43	)
Home equity lines of credit		9			11			13			9			11			(2	)		(18	)		(2	)		(18	)		33			50			(17	)		(34	)
Home equity loans serviced by others¹		9			11			9			9			8			(2	)		(18	)		1			13			29			23			6			26
Home equity lines of credit serviced by others¹		3			4			3			4			3			(1	)		(25	)		—			—			10			10			—			—
Automobile		39			32			39			39			31			7			22			8			26			110			78			32			41
Student		11			14			11			14			12			(3	)		(21	)		(1	)		(8	)		36			37			(1	)		(3	)
Credit card		14			15			14			14			14			(1	)		(7	)		—			—			43			45			(2	)		(4	)
Other retail		16			11			15			15			17			5			45			(1	)		(6	)		42			41			1			2

Total retail		112			106			113			120			109			6			6			3			3			331			324			7			2

Total gross charge-offs	$	145		$	113		$	126		$	124		$	120		$	32			28	%	$	25			21	%	$	384		$	356		$	28			8	%

GROSS RECOVERIES:
Commercial	$	5		$	5		$	3		$	4		$	3		$	—			—	%	$	2			67	%	$	13		$	14		($	1	)		(7	%)
Commercial real estate		9			—			1			3			3			9			100			6			200			10			28			(18	)		(64	)
Leases		—			—			—			—			—			—			—			—			—			—			—			—			—

Total commercial		14			5			4			7			6			9			180			8			133			23			42			(19	)		(45	)
Residential mortgages		2			2			3			4			3			—			—			(1	)		(33	)		7			8			(1	)		(13	)
Home equity loans		10			3			2			4			3			7			233			7			233			15			7			8			114
Home equity lines of credit		7			4			3			4			3			3			75			4			133			14			14			—			—
Home equity loans serviced by others¹		5			6			4			4			5			(1	)		(17	)		—			—			15			13			2			15
Home equity lines of credit serviced by others¹		2			2			1			2			2			—			—			—			—			5			6			(1	)		(17	)
Automobile		15			17			17			15			14			(2	)		(12	)		1			7			49			34			15			44
Student		3			3			3			3			3			—			—			—			—			9			9			—			—
Credit card		2			2			2			2			2			—			—			—			—			6			6			—			—
Other retail		2			4			4			2			4			(2	)		(50	)		(2	)		(50	)		10			10			—			—

Total retail		48			43			39			40			39			5			12			9			23			130			107			23			21

Total gross recoveries	$	62		$	48		$	43		$	47		$	45		$	14			29	%	$	17			38	%	$	153		$	149		$	4			3	%

NET CHARGE-OFFS (RECOVERIES):
Commercial	$	15		($	1	)	$	10		($	1	)	$	7		$	16			NM		$	8			114	%	$	24		$	13		$	11			85	%
Commercial real estate		1			3			(1	)		(2	)		(2	)		(2	)		(67	)		3			150			3			(23	)		26			113
Leases		3			—			—			—			—			3			100			3			100			3			—			3			100

Total commercial		19			2			9			(3	)		5			17			NM			14			NM			30			(10	)		40			NM
Residential mortgages		2			3			3			1			2			(1	)		(33	)		—			—			8			9			(1	)		(11	)
Home equity loans		(3	)		—			1			7			5			(3	)		100			(8	)		(160	)		(2	)		16			(18	)		(113	)
Home equity lines of credit		2			7			10			5			8			(5	)		(71	)		(6	)		(75	)		19			36			(17	)		(47	)
Home equity loans serviced by others¹		4			5			5			5			3			(1	)		(20	)		1			33			14			10			4			40
Home equity lines of credit serviced by others¹		1			2			2			2			1			(1	)		(50	)		—			—			5			4			1			25
Automobile		24			15			22			24			17			9			60			7			41			61			44			17			39
Student		8			11			8			11			9			(3	)		(27	)		(1	)		(11	)		27			28			(1	)		(4	)
Credit card		12			13			12			12			12			(1	)		(8	)		—			—			37			39			(2	)		(5	)
Other retail		14			7			11			13			13			7			100			1			8			32			31			1			3

Total retail		64			63			74			80			70			1			2			(6	)		(9	)		201			217			(16	)		(7	)

Total net charge-offs (recoveries)	$	83		$	65		$	83		$	77		$	75		$	18			28	%	$	8			11	%	$	231		$	207		$	24			12	%

¹	Our SBO portfolio consists of purchased loans and lines of credit that were originally serviced by others. We now service a portion of this portfolio internally.

CREDIT-RELATED INFORMATION, CONTINUED

(dollars in millions, except ratios)


	QUARTERLY TRENDS																											FOR THE NINE MONTHS ENDED SEPT 30,
ANNUALIZED NET CHARGE-OFF																3Q16 Change																		2016 Change
(RECOVERY) RATES:	3Q16			2Q16			1Q16			4Q15			3Q15			2Q16						3Q15						2016			2015			2015
																$/bps			%			$/bps			%									$/bps			%
Commercial		0.16	%		(0.01	%)		0.12	%		(0.01	%)		0.08	%		17	bps					8	bps					0.09	%		0.05	%		4	bps
Commercial real estate		0.05			0.11			(0.01	)		(0.11	)		(0.11	)		(6	) bps					16	bps					0.05			(0.39	)		44	bps
Leases		0.30			—			—			—			—			30	bps					30	bps					0.10			—			10	bps
Total commercial		0.15			0.01			0.08			(0.03	)		0.04			14	bps					11	bps					0.08			(0.03	)		11	bps
Residential mortgages		0.06			0.08			0.09			0.05			0.05			(3	) bps					—	bps					0.07			0.10			(3	) bps
Home equity loans		(0.36	)		0.01			0.06			1.07			0.60			(37	) bps					(96	) bps					(0.09	)		0.66			(75	) bps
Home equity lines of credit		0.07			0.19			0.26			0.12			0.21			(12	) bps					(14	) bps					0.17			0.32			(15	) bps
Home equity loans serviced by others¹		1.88			2.47			2.03			1.81			1.12			(59	) bps					76	bps					2.13			1.11			102	bps
Home equity lines of credit serviced by others¹		1.84			2.35			2.09			1.99			1.23			(51	) bps					61	bps					2.10			1.24			86	bps
Automobile		0.69			0.41			0.65			0.71			0.50			28	bps					19	bps					0.59			0.43			16	bps
Student		0.59			0.83			0.64			1.07			1.07			(24	) bps					(48	) bps					0.68			1.25			(57	) bps
Credit card		2.84			3.19			3.07			2.98			2.96			(35	) bps					12	bps					3.03			3.19			(16	) bps
Other retail		3.74			3.00			4.18			4.38			5.56			74	bps					(182	) bps					3.63			4.40			(77	) bps
Total retail		0.47			0.48			0.55			0.60			0.54			(1	) bps					(7	) bps					0.50			1.57			(7	) bps
Total loans and leases		0.32	%		0.25	%		0.33	%		0.31	%		0.31	%		7	bps					1	bps					0.30	%		0.29	%		1	bps
Memo: Average loans:
Commercial	$	35,986		$	35,622		$	34,018		$	33,080		$	32,832		$	364			1	%	$	3,154			10	%	$	35,212		$	32,536		$	2,676			8	%
Commercial real estate		9,905			9,649			9,108			8,855			8,406			256			3			1,499			18			9,555			8,020			1,535			19
Leases		3,813			3,863			3,917			3,884			3,936			(50	)		(1	)		(123	)		(3	)		3,864			3,909			(45	)		(1	)

Total commercial		49,704			49,134			47,043			45,819			45,174			570			1			4,530			10			48,631			44,465			4,166			9
Residential mortgages		14,155			13,491			13,465			13,030			12,470			664			5			1,685			14			13,705			12,104			1,601			13
Home equity loans		2,088			2,231			2,471			2,751			2,928			(143	)		(6	)		(840	)		(29	)		2,263			3,117			(854	)		(27	)
Home equity lines of credit		14,314			14,477			14,632			14,659			14,813			(163	)		(1	)		(499	)		(3	)		14,474			15,059			(585	)		(4	)
Home equity loans serviced by others¹		837			899			958			1,017			1,086			(62	)		(7	)		(249	)		(23	)		898			1,151			(253	)		(22	)
Home equity lines of credit serviced by others¹		256			299			340			375			425			(43	)		(14	)		(169	)		(40	)		298			479			(181	)		(38	)
Automobile		14,053			13,972			13,792			13,824			13,810			81			1			243			2			13,940			13,412			528			4
Student		5,750			5,407			4,852			4,052			3,530			343			6			2,220			63			5,338			3,064			2,274			74
Credit card		1,623			1,600			1,601			1,625			1,616			23			1			7			—			1,608			1,620			(12	)		(1	)
Other retail		1,256			1,167			1,108			1,047			939			89			8			317			34			1,177			988			189			19

Total retail		54,332			53,543			53,219			52,380			51,617			789			1			2,715			5			53,701			50,994			2,707			5

Total loans and leases	$	104,036		$	102,677		$	100,262		$	98,199		$	96,791		$	1,359			1	%	$	7,245			7	%	$	102,332		$	95,459		$	6,873			7	%

¹	Our SBO portfolio consists of purchased loans and lines of credit that were originally serviced by others. We now service a portion of this portfolio internally.

CREDIT-RELATED INFORMATION, CONTINUED

(dollars in millions)


	QUARTERLY TRENDS																								FOR THE NINE MONTHS ENDED SEPT 30,
													3Q16 Change																	2016 Change
SUMMARY OF CHANGES IN THE COMPONENTS OF	3Q16			2Q16		1Q16		4Q15			3Q15		2Q16						3Q15						2016		2015			2015
THE ALLOWANCE FOR CREDIT LOSSES													$			%			$			%								$			%
Allowance for loan and lease losses - beginning	$	1,246		$	1,224	$	1,216	$	1,201		$	1,201	$	22			2	%	$	45			4	%	$	1,216	$	1,195		$	21			2	%
Charge-offs:
Commercial		33			7		13		4			11		26			NM			22			200			53		32			21			66
Retail		112			106		113		120			109		6			6			3			3			331		324			7			2

Total charge-offs		145			113		126		124			120		32			28			25			21			384		356			28			8
Recoveries:
Commercial		14			5		4		7			6		9			180			8			133			23		42			(19	)		(45	)
Retail		48			43		39		40			39		5			12			9			23			130		107			23			21

Total recoveries		62			48		43		47			45		14			29			17			38			153		149			4			3

Net charge-offs		83			65		83		77			75		18			28			8			11			231		207			24			12
Provision for loan and lease losses:
Commercial		(2	)		45		46		18			15		(47	)		(104	)		(17	)		(113	)		89		21			68			NM
Retail		79			42		45		74			58		37			88			21			36			166		192			(26	)		(14	)

Total provision for loan and lease losses		77			87		91		92			73		(10	)		(11	)		4			5			255		213			42			20
Sale/Other		—			—		—		—			2		—			—			(2	)		(100	)		—		—			—			—

Allowance for loan and lease losses - ending	$	1,240		$	1,246	$	1,224	$	1,216		$	1,201	($	6	)		—	%	$	39			3	%	$	1,240	$	1,201		$	39			3	%

Reserve for unfunded lending commitments - beginning	$	61		$	58	$	58	$	59		$	56	$	3			5	%	$	5			9	%	$	58	$	61		($	3	)		(5	%)
Provision for unfunded lending commitments		9			3		—		(1	)		3		6			200			6			200			12		(2	)		14			NM

Reserve for unfunded lending commitments - ending	$	70		$	61	$	58	$	58		$	59	$	9			15	%	$	11			19	%	$	70	$	59		$	11			19	%

Total allowance for credit losses - ending	$	1,310		$	1,307	$	1,282	$	1,274		$	1,260	$	3			—	%	$	50			4	%	$	1,310	$	1,260		$	50			4	%

CREDIT-RELATED INFORMATION, CONTINUED

(dollars in millions)


	AS OF										SEPT 30, 2016 CHANGE
	Sept 30, 2016		June 30, 2016		Mar 31, 2016		Dec 31, 2015		Sept 30, 2015		June 30, 2016						Sept 30, 2015
ALLOWANCE COMPONENTS											$			%			$			%
ALLOWANCE FOR CREDIT LOSSES
Individually evaluated	$	55	$	52	$	42	$	36	$	23	$	3			6	%	$	32			139	%
Formula-based evaluation		670		685		649		618		611		(15	)		(2	)		59			10

Total commercial		725		737		691		654		634		(12	)		(2	)		91			14
Individually evaluated		78		79		82		101		104		(1	)		(1	)		(26	)		(25	)
Formula-based evaluation		507		491		509		519		522		16			3			(15	)		(3	)

Total retail		585		570		591		620		626		15			3			(41	)		(7	)

Total allowance for credit losses	$	1,310	$	1,307	$	1,282	$	1,274	$	1,260	$	3			—	%	$	50			4	%

CAPITAL AND RATIOS

(dollars in millions, except ratios)


	AS OF																											FOR THE NINE MONTHS ENDED SEPT 30,
																SEPT 30, 2016 CHANGE																2016 Change
	Sept 30, 2016			June 30, 2016			Mar 31, 2016			Dec 31, 2015			Sept 30, 2015			June 30, 2016						Sept 30, 2015						2016		2015		2015
																$			%			$			%							$			%
CAPITAL RATIOS AND COMPONENTS¹ (PRELIMINARY)
CET1 capital	$	13,763		$	13,768		$	13,570		$	13,389		$	13,200		($	5	)		—	%	$	563			4	%
Tier 1 capital		14,010			14,015			13,817			13,636			13,447			(5	)		—			563			4
Total capital		17,290			17,823			17,587			17,505			17,307			(533	)		(3	)		(17	)		—
Risk-weighted assets		121,612			119,492			116,591			114,084			112,277			2,120			2			9,335			8
Adjusted average assets²		138,425			136,301			132,951			130,455			129,334			2,124			2			9,091			7
CET1 capital ratio		11.3	%		11.5	%		11.6	%		11.7	%		11.8	%
Tier 1 capital ratio		11.5			11.7			11.9			12.0			12.0
Total capital ratio		14.2			14.9			15.1			15.3			15.4
Tier 1 leverage ratio		10.1			10.3			10.4			10.5			10.4
Pro forma Basel III fully phased-in common equity tier 1 capital ratio		11.3			11.5			11.6			11.7			11.7
TANGIBLE COMMON EQUITY (period-end):
Common stockholders’ equity	$	19,934		$	19,979		$	19,718		$	19,399		$	19,353		($	45	)		—	%	$	581			3	%	$	19,934	$	19,353	$	581			3	%
Less: Goodwill		6,876			6,876			6,876			6,876			6,876			—			—			—			—			6,876		6,876		—			—
Less: Other intangible assets		1			2			3			3			3			(1	)		(50	)		(2	)		(67	)		1		3		(2	)		(67	)
Add: Deferred tax liabilities³		519			507			494			480			465			12			2			54			12			519		465		54			12

Total tangible common equity	$	13,576		$	13,608		$	13,333		$	13,000		$	12,939		($	32	)		—	%	$	637			5	%	$	13,576	$	12,939	$	637			5	%

TANGIBLE COMMON EQUITY (average):
Common stockholders’ equity	$	19,810		$	19,768		$	19,567		$	19,359		$	19,261		$	42			—	%	$	549			3	%	$	19,715	$	19,352	$	363			2	%
Less: Goodwill		6,876			6,876			6,876			6,876			6,876			—			—			—			—			6,876		6,876		—			—
Less: Other intangible assets		1			2			3			3			4			(1	)		(50	)		(3	)		(75	)		2		5		(3	)		(60	)
Add: Deferred tax liabilities³		509			496			481			468			453			13			3			56			12			495		438		57			13

Total tangible common equity	$	13,442		$	13,386		$	13,169		$	12,948		$	12,834		$	56			—	%	$	608			5	%	$	13,332	$	12,909	$	423			3	%

INTANGIBLE ASSETS (period-end):
Goodwill	$	6,876		$	6,876		$	6,876		$	6,876		$	6,876		$	—			—	%	$	—			—	%	$	6,876	$	6,876	$	—			—	%
Other intangible assets		1			2			3			3			3			(1	)		50			(2	)		(67	)		1		3		(2	)		(67	)

Total intangible assets	$	6,877		$	6,878		$	6,879		$	6,879		$	6,879		($	1	)		—	%	($	2	)		—	%	$	6,877	$	6,879	($	2	)		—	%

¹	Basel III transitional rules for institutions applying the standardized approach to calculating risk-weighted assets became effective January 1, 2015. The capital ratios and associated components are prepared using the Basel III standardized transitional approach.

Adjusted average assets include quarterly average assets, less deductions for disallowed goodwill and other intangibles assets, net of deferred tax liabilities related to tax deductible goodwill, and the accumulated other comprehensive income impact related to the adoption of post-retirement benefit plan guidance under GAAP.

³	Deferred tax liabilities relate to tax-deductible goodwill, which is netted against goodwill when calculating tangible common equity.

PER-SHARE RELATED INFORMATION

(dollars in millions, except per share and ratio data)


	QUARTERLY TRENDS																											FOR THE NINE MONTHS ENDED SEPT 30,
																3Q16 Change																		2016 Change
	3Q16			2Q16			1Q16			4Q15			3Q15			2Q16						3Q15						2016			2015			2015
EARNINGS PER SHARE DATA																$			%			$			%									$			%
Basic earnings per share:
Net income	$	297		$	243		$	223		$	221		$	220		$	54			22	%	$	77			35	%	$	763		$	619		$	144			23	%
Less: Preferred stock dividends		7			—			7			—			7			7			100			—			—			14			7			7			1

Net income available to common stockholders		290			243			216			221			213			47			19	%		77			36	%		749			612			137			22	%

Net income available to common stockholders, adjusted¹	$	271		$	243		$	216		$	221		$	213		$	28			12	%	$	58			27	%	$	730		$	643		$	87			14	%

Total weighted-average basic shares outstanding		519,458,976			528,968,330			528,070,648			527,648,630			530,985,255			(9,509,354	)		(2	)		(11,526,279	)		(2	)		525,477,273			538,279,222			(12,801,949	)		(2	)
Net income per share - basic	$	0.56		$	0.46		$	0.41		$	0.42		$	0.40		$	0.10			22	%	$	0.16			40	%	$	1.43		$	1.14		$	0.29			25	%
Net income per share - basic, adjusted¹	$	0.52		$	0.46		$	0.41		$	0.42		$	0.40		$	0.06			13	%	$	0.12			30	%	$	1.39		$	1.20		$	0.19			16	%
Diluted earnings per share:
Net income applicable to common stockholders	$	290		$	243		$	216		$	221		$	213		$	47			19		$	77			36		$	749		$	612		$	137			22
Add: Restructuring charges and special items, net of income tax expense		—			—			—			—			—			—			—			—			—			—			31			(31	)		(100	)
Add: Notable items, net of income tax expense		(19	)		—			—			—			—			(19	)		100			(19	)		100			(19	)		—			(19	)		100

Net income applicable to common stockholders, adjusted¹	$	271		$	243		$	216		$	221		$	213		$	28			12	%	$	58			27	%	$	730		$	643		$	87			14	%

Total weighted-average basic shares outstanding		519,458,976			528,968,330			528,070,648			527,648,630			530,985,255			(9,509,354	)		(2	)		(11,526,279	)		(2	)		525,477,273			538,279,222			(12,801,949	)		(2	)
Add: Weighted-average dilutive shares		1,663,490			1,396,873			2,375,540			2,627,043			2,412,903			266,617			19			(749,413	)		(31	)		1,784,111			2,647,139			(863,028	)		(33	)

Total weighted-average diluted shares outstanding		521,122,466			530,365,203			530,446,188			530,275,673			533,398,158			(9,242,737	)		(2	)		(12,275,692	)		(2	)		527,261,384			540,926,361			(13,664,977	)		(3	)
Net income per share - diluted	$	0.56		$	0.46		$	0.41		$	0.42		$	0.40		$	0.10			22	%	$	0.16			40	%	$	1.42		$	1.13		$	0.29			26	%
Net income per share - diluted, adjusted¹	$	0.52		$	0.46		$	0.41		$	0.42		$	0.40		$	0.06			13	%	$	0.12			30	%	$	1.39		$	1.19		$	0.20			17	%
COMMON SHARES OUTSTANDING
Common shares—at end of period		518,148,345			529,094,976			528,933,727			527,774,428			527,636,510			(10,946,631	)		(2	%)		(9,488,165	)		(2	%)		518,148,345			527,636,510			(9,488,165	)		(2	%)
Cash dividends declared and paid per common share	$	0.12		$	0.12		$	0.10		$	0.10		$	0.10		$	—			—		$	0.02			20		$	0.34		$	0.30		$	0.04			13
Book value per common share	$	38.47		$	37.76		$	37.28		$	36.76		$	36.68		$	0.71			2		$	1.79			5		$	38.47		$	36.68		$	1.79			5
Tangible book value per common share	$	26.20		$	25.72		$	25.21		$	24.63		$	24.52		$	0.48			2		$	1.68			7		$	26.20		$	24.52		$	1.68			7
Dividend payout ratio		22	%		26	%		24	%		24	%		25	%		(5	)		NM			(3	)		NM			24	%		26	%		(3	)		NM
SHARE PRICE
High	$	25.11		$	24.24		$	25.99		$	27.17		$	28.18		$	0.87			4	%	($	3.07	)		(11	)%	$	25.99		$	28.71		($	2.72	)		(9	)%
Low		18.58			18.34			18.04			22.48			21.14			0.24			1			(2.56	)		(12	)		18.04			21.14			(3.10	)		(15	)
Close		24.71			19.98			20.95			26.19			23.86			4.73			24			0.85			4			24.71			23.86			0.85			4
Market Capitalization		12,803			10,571			11,081			13,822			12,589			2,232			21			214			2			12,803			12,589			214			2

¹These are non-GAAP financial measures. For further information on these measures, refer to pages 29-36.

KEY PERFORMANCE METRICS, NON-GAAP FINANCIAL MEASURES AND RECONCILIATIONS

Adjusted - excluding restructuring charges, special items and/or notable items

(dollars in millions, except per-share data)

Key Performance Metrics:

Our management team uses certain key performance metrics (KPMs) to gauge our performance and progress over time in achieving our strategic and operational goals and also in comparing our performance against our peers. In connection with our path to becoming an independent public company, we established the following financial targets, in addition to others, as KPMs. These KPMs are utilized by our management in measuring our progress against financial goals and as a tool in helping assess performance for compensation purposes. These KPMs can be largely found in our Registration Statements on Form S-1 and our periodic reports which are filed with the Securities and Exchange Commission, and are supplemented from time to time with additional information in connection with our quarterly earnings releases.

Our key performance metrics include:

Return on average tangible common equity (ROTCE);

Return on average total tangible assets (ROTA);

Efficiency ratio;

Operating leverage; and

Common equity tier 1 capital ratio (Basel III fully phased-in basis).

In establishing goals for these KPMs, we determined that they would be measured on a management-reporting basis, or an operating basis, which we refer to externally as Adjusted results. We believe that these Adjusted results, which exclude restructuring charges, special items and/or notable items, as applicable, provide the best representation of our underlying financial progress toward these goals as they exclude items that our management does not consider indicative of our on-going financial performance. We have consistently shown these metrics on this basis to investors since our initial public offering in September of 2014. Adjusted KPMs are considered non-GAAP financial measures.

Non-GAAP Financial Measures:

This document contains non-GAAP financial measures. The table below presents reconciliations of certain non-GAAP measures. These reconciliations exclude restructuring charges, special items and/or notable items, which are included, where applicable, in the financial results presented in accordance with GAAP. Restructuring charges and special items include expenses related to our efforts to improve processes and enhance efficiencies, as well as rebranding, separation from RBS and regulatory expenses. Notable items include certain revenue or expense items that may occur in a reporting period which management does not consider indicative of on-going financial performance.

The non-GAAP measures presented below include reconciliations to the most directly comparable GAAP measures and are: “noninterest income”, “total revenue”, “ noninterest expense”, “pre-provision profit”, “income before income tax expense”, “income tax expense”, “net income”, “net income available to common stockholders”, “other income”, “salaries and employee benefits”, “outside services”, “occupancy”, “equipment expense”, “amortization of software expense”, “other operating expense”, “net income per average common share”, “return on average common equity” and “return on average total assets”.

We believe these non-GAAP measures provide useful information to investors because these are among the measures used by our management team to evaluate our operating performance and make day-to-day operating decisions. In addition, we believe restructuring charges, special items and/or notable items in any period do not reflect the operational performance of the business in that period and, accordingly, it is useful to consider these line items with and without restructuring charges, special items and/or notable items. We believe this presentation also increases comparability of period-to-period results.

Other companies may use similarly titled non-GAAP financial measures that are calculated differently from the way we calculate such measures. Accordingly, our non-GAAP financial measures may not be comparable to similar measures used by other companies. We caution investors not to place undue reliance on such non-GAAP measures, but instead to consider them with the most directly comparable GAAP measure. Non-GAAP financial measures have limitations as analytical tools, and should not be considered in isolation, or as a substitute for our results as reported under GAAP.

KEY PERFORMANCE METRICS, NON-GAAP FINANCIAL MEASURES AND RECONCILIATIONS (CONTINUED)

Adjusted - excluding restructuring charges, special items and/or notable items

(dollars in millions, except per-share data)


		QUARTERLY TRENDS																							FOR THE NINE MONTHS ENDED SEPT 30,
													3Q16 Change																		2016 Change
		3Q16			2Q16		1Q16		4Q15		3Q15		2Q16						3Q15						2016			2015			2015
													$			%			$			%									$			%
Noninterest income, adjusted:
Noninterest income (GAAP)		$	435		$	355	$	330	$	362	$	353	$	80			23	%	$	82			23	%	$	1,120		$	1,060		$	60			6	%
Less: Special items			—			—		—		—		—		—			—			—			—			—			—			—			—
Less: Notable items			67			—		—		—		—		67			100			67			100			67			—			67			100

Noninterest income, adjusted (non-GAAP)		$	368		$	355	$	330	$	362	$	353	$	13			4	%	$	15			4	%	$	1,053		$	1,060		($	7	)		(1	%)

Total revenue, adjusted:
Total revenue (GAAP)	A	$	1,380		$	1,278	$	1,234	$	1,232	$	1,209	$	102			8	%	$	171			14	%	$	3,892		$	3,592		$	300			8	%
Less: Special items			—			—		—		—		—		—			—			—			—			—			—			—			—
Less: Notable items			67			—		—		—		—		67			100			67			100			67			—			67			100

Total revenue, adjusted (non-GAAP)	B	$	1,313		$	1,278	$	1,234	$	1,232	$	1,209	$	35			3	%	$	104			9	%	$	3,825		$	3,592		$	233			6	%

Noninterest expense, adjusted:
Noninterest expense (GAAP)	C	$	867		$	827	$	811	$	810	$	798	$	40			5	%	$	69			9	%	$	2,505		$	2,449		$	56			2	%
Less: Restructuring charges and special items			—			—		—		—		—		—			—			—			—			—			50			(50	)		(100	)
Less: Notable items			36			—		—		—		—		36			100			36			100			36			—			36			100

Noninterest expense, adjusted (non-GAAP)	D	$	831		$	827	$	811	$	810	$	798	$	4			—	%	$	33			4	%	$	2,469		$	2,399		$	70			3	%

Pre-provision profit, adjusted:
Total revenue, adjusted (non-GAAP)		$	1,313		$	1,278	$	1,234	$	1,232	$	1,209	$	35			3	%	$	104			9	%	$	3,825		$	3,592		$	233			6	%
Less: Noninterest expense, adjusted (non-GAAP)			831			827		811		810		798		4			—			33			4			2,469			2,399			70			3

Pre-provision profit, adjusted (non-GAAP)		$	482		$	451	$	423	$	422	$	411	$	31			7	%	$	71			17	%	$	1,356		$	1,193		$	163			14	%

Income before income tax expense, adjusted:
Income before income tax expense (GAAP)		$	427		$	361	$	332	$	331	$	335	$	66			18	%	$	92			27	%	$	1,120		$	932		$	188			20	%
Less: Income before income tax expense (benefit) related to restructuring charges and special items			—			—		—		—		—		—			—			—			—			—			(50	)		50			100
Less: Income before income tax expense (benefit) related to notable items			31			—		—		—		—		31			100			31			100			31			—			31			100

Income before income tax expense, adjusted (non-GAAP)		$	396		$	361	$	332	$	331	$	335	$	35			10	%	$	61			18	%	$	1,089		$	982		$	107			11	%

Income tax expense, adjusted:
Income tax expense (GAAP)		$	130		$	118	$	109	$	110	$	115	$	12			10	%	$	15			13	%	$	357		$	313		$	44			14	%
Less: Income tax expense (benefit) related to restructuring charges and special items			—			—		—		—		—		—			—			—			—			—			(19	)		19			100
Less: Income tax expense (benefit) related to notable items			12			—		—		—		—		12			100			12			100			12			—			12			100

Income tax expense, adjusted (non-GAAP)		$	118		$	118	$	109	$	110	$	115	$	—			—	%	$	3			3	%	$	345		$	332		$	13			4	%

Net income, adjusted:
Net income (GAAP)	E	$	297		$	243	$	223	$	221	$	220	$	54			22	%	$	77			35	%	$	763		$	619		$	144			23	%
Add: Restructuring charges and special items, net of income tax expense (benefit)			—			—		—		—		—		—			—			—			—			—			31			(31	)		(100	)
Add: Notable items, net of income tax expense (benefit)			(19	)		—		—		—		—		(19	)		100			(19	)		100			(19	)		—			(19	)		100

Net income, adjusted (non-GAAP)	F	$	278		$	243	$	223	$	221	$	220	$	35			14	%	$	58			26	%	$	744		$	650		$	94			14	%

Net income available to common stockholders, adjusted:
Net income available to common stockholders (GAAP)	G	$	290		$	243	$	216	$	221	$	213	$	47			19	%	$	77			36	%	$	749		$	612		$	137			22	%
Add: Restructuring charges and special items, net of income tax expense (benefit)			—			—		—		—		—		—			—			—			—			—			31			(31	)		(100	)
Add: Notable items, net of income tax expense (benefit)			(19	)		—		—		—		—		(19	)		100			(19	)		100			(19	)		—			(19	)		100

Net income available to common stockholders, adjusted (non-GAAP)	H	$	271		$	243	$	216	$	221	$	213	$	28			12	%	$	58			27	%	$	730		$	643		$	87			14	%

KEY PERFORMANCE METRICS, NON-GAAP FINANCIAL MEASURES AND RECONCILIATIONS (CONTINUED)

Adjusted - excluding restructuring charges, special items and/or notable items

(dollars in millions, except per-share data)


		QUARTERLY TRENDS																											FOR THE NINE MONTHS ENDED SEPT 30,
																	3Q16 Change																		2016 Change
		3Q16			2Q16			1Q16			4Q15			3Q15			2Q16						3Q15						2016			2015			2015
																	$/bps			%			$/bps			%									$/bps			%
Operating leverage:
Total revenue (GAAP)	A	$	1,380		$	1,278		$	1,234		$	1,232		$	1,209		$	102			7.98	%	$	171			14.14	%	$	3,892		$	3,592		$	300			8.35	%
Less: Noninterest expense (GAAP)	C		867			827			811			810			798			40			4.84			69			8.65			2,505			2,449			56			2.29

Operating leverage																					3.14	%					5.49	%											6.06	%

Operating leverage, adjusted:
Total revenue, adjusted (non-GAAP)	B	$	1,313		$	1,278		$	1,234		$	1,232		$	1,209		$	35			2.74	%	$	104			8.60	%	$	3,825		$	3,592		$	233			6.49	%
Less: Noninterest expense, adjusted (non-GAAP)	D		831			827			811			810			798			4			0.48			33			4.14			2,469			2,399			70			2.92

Operating leverage, adjusted (non-GAAP)																					2.26	%					4.46	%											3.57	%

Return on average common equity and return on average common equity, adjusted:
Average common equity (GAAP)	I	$	19,810		$	19,768		$	19,567		$	19,359		$	19,261		$	42			—	%	$	549			3	%	$	19,715		$	19,352		$	363			2	%
Return on average common equity	G/I		5.82	%		4.94	%		4.45	%		4.51	%		4.40	%		88	bps					142	bps					5.08	%		4.23	%		85	bps
Return on average common equity, adjusted (non-GAAP)	H/I		5.44			4.94			4.45			4.51			4.40			50	bps					104	bps					4.95			4.45			50	bps
Return on average tangible common equity and return on average tangible common equity, adjusted:
Average common equity (GAAP)	I	$	19,810		$	19,768		$	19,567		$	19,359		$	19,261		$	42			—	%	$	549			3	%	$	19,715		$	19,352		$	363			2	%
Less: Average goodwill (GAAP)			6,876			6,876			6,876			6,876			6,876			—			—			—			—			6,876			6,876			—			—
Less: Average other intangibles (GAAP)			1			2			3			3			4			(1	)		(50	)		(3	)		(75	)		2			5			(3	)		(60	)
Add: Average deferred tax liabilities related to goodwill (GAAP)			509			496			481			468			453			13			3			56			12			495			438			57			13

Average tangible common equity	J	$	13,442		$	13,386		$	13,169		$	12,948		$	12,834		$	56			—	%	$	608			5	%	$	13,332		$	12,909		$	423			3	%

Return on average tangible common equity	G/J		8.58	%		7.30	%		6.61	%		6.75	%		6.60	%		128	bps					198	bps					7.51	%		6.34	%		117	bps
Return on average tangible common equity, adjusted (non-GAAP)	H/J		8.02			7.30			6.61			6.75			6.60			72	bps					142	bps					7.32			6.67			65	bps
Return on average total assets and return on average total assets, adjusted:
Average total assets (GAAP)	K	$	144,399		$	142,179		$	138,780		$	136,298		$	135,103		$	2,220			2	%	$	9,296			7	%	$	141,795		$	134,655		$	7,140			5	%
Return on average total assets	E/K		0.82	%		0.69	%		0.65	%		0.64	%		0.65	%		13	bps					17	bps					0.72	%		0.62	%		10	bps
Return on average total assets, adjusted (non-GAAP)	F/K		0.77			0.69			0.65			0.64			0.65			8	bps					12	bps					0.70			0.65			5	bps
Return on average total tangible assets and return on average total tangible assets, adjusted:
Average total assets (GAAP)	K	$	144,399		$	142,179		$	138,780		$	136,298		$	135,103		$	2,220			2	%	$	9,296			7	%	$	141,795		$	134,655		$	7,140			5	%
Less: Average goodwill (GAAP)			6,876			6,876			6,876			6,876			6,876			—			—			—			—			6,876			6,876			—			—
Less: Average other intangibles (GAAP)			1			2			3			3			4			(1	)		(50	)		(3	)		(75	)		2			5			(3	)		(60	)
Add: Average deferred tax liabilities related to goodwill (GAAP)			509			496			481			468			453			13			3			56			12			495			438			57			13

Average tangible assets	L	$	138,031		$	135,797		$	132,382		$	129,887		$	128,676		$	2,234			2	%	$	9,355			7	%	$	135,412		$	128,212		$	7,200			6	%

Return on average total tangible assets	E/L		0.86	%		0.72	%		0.68	%		0.67	%		0.68	%		14	bps					18	bps					0.75	%		0.65	%		10	bps
Return on average total tangible assets, adjusted (non-GAAP)	F/L		0.80			0.72			0.68			0.67			0.68			8	bps					12	bps					0.73			0.68			5	bps

KEY PERFORMANCE METRICS, NON-GAAP FINANCIAL MEASURES AND RECONCILIATIONS (CONTINUED)

Adjusted - excluding restructuring charges, special items and/or notable items

(dollars in millions, except per-share data)


		QUARTERLY TRENDS																											FOR THE NINE MONTHS ENDED SEPT 30,
																	3Q16 Change																		2016 Change
		3Q16			2Q16			1Q16			4Q15			3Q15			2Q16						3Q15						2016			2015			2015
																	$/bps			%			$/bps			%									$/bps			%
Efficiency ratio and efficiency ratio, adjusted:
Efficiency ratio	C/A		62.88	%		64.71	%		65.66	%		65.76	%		66.02	%		(183	) bps					(314	) bps					64.36	%		68.17	%		(381	) bps
Efficiency ratio, adjusted (non-GAAP)	D/B		63.31			64.71			65.66			65.76			66.02			(140	) bps					(271	) bps					64.54			66.78			(224	) bps
Tangible book value per common share:
Common shares - at end of period (GAAP)	M		518,148,345			529,094,976			528,933,727			527,774,428			527,636,510			(10,946,631	)		(2	%)		(9,488,165	)		(2	%)		518,148,345			527,636,510			(9,488,165	)		(2	%)
Common stockholders’ equity (GAAP)		$	19,934		$	19,979		$	19,718		$	19,399		$	19,353		($	45	)		—		$	581			3		$	19,934		$	19,353		$	581			3
Less: Goodwill (GAAP)			6,876			6,876			6,876			6,876			6,876			—			—			—			—			6,876			6,876			—			—
Less: Other intangible assets (GAAP)			1			2			3			3			3			(1	)		(50	)		(2	)		(67	)		1			3			(2	)		(67	)
Add: Deferred tax liabilities related to goodwill (GAAP)			519			507			494			480			465			12			2			54			12			519			465			54			12

Tangible common equity	N	$	13,576		$	13,608		$	13,333		$	13,000		$	12,939		($	32	)		—	%	$	637			5	%	$	13,576		$	12,939		$	637			5	%

Tangible book value per common share	N/M	$	26.20		$	25.72		$	25.21		$	24.63		$	24.52		$	0.48			2	%	$	1.68			7	%	$	26.20		$	24.52		$	1.68			7	%
Net income per average common share - basic and diluted, adjusted:
Average common shares outstanding - basic (GAAP)	O		519,458,976			528,968,330			528,070,648			527,648,630			530,985,255			(9,509,354	)		(2	%)		(11,526,279	)		(2	%)		525,477,273			538,279,222			(12,801,949	)		(2	%)
Average common shares outstanding - diluted (GAAP)	P		521,122,466			530,365,203			530,446,188			530,275,673			533,398,158			(9,242,737	)		(2	)		(12,275,692	)		(2	)		527,261,384			540,926,361			(13,664,977	)		(3	)
Net income available to common stockholders (GAAP)	G	$	290		$	243		$	216		$	221		$	213		$	47			19		$	77			36		$	749		$	612		$	137			22
Net income per average common share - basic (GAAP)	G/O		0.56			0.46			0.41			0.42			0.40			0.10			22			0.16			40			1.43			1.14			0.29			25
Net income per average common share - diluted (GAAP)	G/P		0.56			0.46			0.41			0.42			0.40			0.10			22			0.16			40			1.42			1.13			0.29			26
Net income available to common stockholders, adjusted (non-GAAP)	H		271			243			216			221			213			28			12			58			27			730			643			87			14
Net income per average common share - basic, adjusted (non-GAAP)	H/O		0.52			0.46			0.41			0.42			0.40			0.06			13			0.12			30			1.39			1.20			0.19			16
Net income per average common share - diluted, adjusted (non-GAAP)	H/P		0.52			0.46			0.41			0.42			0.40			0.06			13			0.12			30			1.39			1.19			0.20			17
Pro forma Basel III fully phased-in common equity tier 1 capital ratio¹:
Common equity tier 1 (regulatory)		$	13,763		$	13,768		$	13,570		$	13,389		$	13,200
Less: Change in DTA and other threshold deductions (GAAP)			—			1			1			2			2

Pro forma Basel III fully phased-in common equity tier 1	Q	$	13,763		$	13,767		$	13,569		$	13,387		$	13,198

Risk-weighted assets (regulatory general risk weight approach)		$	121,612		$	119,492		$	116,591		$	114,084		$	112,277
Add: Net change in credit and other risk-weighted assets (regulatory)			228			228			232			244			243

Pro forma Basel III standardized approach risk-weighted assets	R	$	121,840		$	119,720		$	116,823		$	114,328		$	112,520

Pro forma Basel III fully phased-in common equity tier 1 capital ratio¹	Q/R		11.3	%		11.5	%		11.6	%		11.7	%		11.7	%

¹	Basel III ratios assume certain definitions impacting qualifying Basel III capital, which otherwise will phase in through 2019, are fully phased-in. Ratios also reflect the required US Standardized methodology for calculating RWAs, effective January 1, 2015.

KEY PERFORMANCE METRICS, NON-GAAP FINANCIAL MEASURES AND RECONCILIATIONS (CONTINUED)

Adjusted - excluding restructuring charges, special items and/or notable items

(dollars in millions, except per-share data)


	QUARTERLY TRENDS																							FOR THE NINE MONTHS ENDED SEPT 30,
												3Q16 Change																2016 Change
	3Q16		2Q16		1Q16		4Q15			3Q15		2Q16						3Q15						2016		2015		2015
												$			%			$			%							$			%
Other income, adjusted
Other income (GAAP)	$	90	$	18	$	16	$	23		$	30	$	72			NM		$	60			200	%	$	124	$	71	$	53			75	%
Less: Special items		—		—		—		—			—		—			—			—			—			—		—		—			—
Less: Notable items		67		—		—		—			—		67			100			67			100			67		—		67			100

Other income, adjusted (non-GAAP)	$	23	$	18	$	16	$	23		$	30	$	5			28	%	($	7	)		(23	%)	$	57	$	71	($	14	)		(20	%)

Salaries and employee benefits, adjusted:
Salaries and employee benefits (GAAP)	$	432	$	432	$	425	$	402		$	404	$	—			—	%	$	28			7	%	$	1,289	$	1,234	$	55			4	%
Less: Restructuring charges and special items		—		—		—		(2	)		—		—			—			—			—			—		5		(5	)		(100	)
Less: Notable items		11		—		—		—			—		11			100			11			100			11		—		11			100

Salaries and employee benefits, adjusted (non-GAAP)	$	421	$	432	$	425	$	404		$	404	($	11	)		(3	%)	$	17			4	%	$	1,278	$	1,229	$	49			4	%

Outside services, adjusted:
Outside services (GAAP)	$	102	$	86	$	91	$	104		$	89	$	16			19	%	$	13			15	%	$	279	$	267	$	12			4	%
Less: Restructuring charges and special items		—		—		—		2			—		—			—			—			—			—		24		(24	)		(100	)
Less: Notable items		8		—		—		—			—		8			100			8			100			8		—		8			100

Outside services, adjusted (non-GAAP)	$	94	$	86	$	91	$	102		$	89	$	8			9	%	$	5			6	%	$	271	$	243	$	28			12	%

Occupancy, adjusted:
Occupancy (GAAP)	$	78	$	76	$	76	$	74		$	75	$	2			3	%	$	3			4	%	$	230	$	245	($	15	)		(6	%)
Less: Restructuring charges and special items		—		—		—		—			—		—			—			—			—			—		17		(17	)		(100	)
Less: Notable items		—		—		—		—			—		—			—			—			—			—		—		—			—

Occupancy, adjusted (non-GAAP)	$	78	$	76	$	76	$	74		$	75	$	2			3	%	$	3			4	%	$	230	$	228	$	2			1	%

Equipment expense, adjusted:
Equipment expense (GAAP)	$	65	$	64	$	65	$	67		$	62	$	1			2	%	$	3			5	%	$	194	$	190	$	4			2	%
Less: Restructuring charges and special items		—		—		—		—			—		—			—			—			—			—		1		(1	)		(100	)
Less: Notable items		—		—		—		—			—		—			—			—			—			—		—		—			—

Equipment expense, adjusted (non-GAAP)	$	65	$	64	$	65	$	67		$	62	$	1			2	%	$	3			5	%	$	194	$	189	$	5			3	%

Amortization of software, adjusted:
Amortization of software (GAAP)	$	46	$	41	$	39	$	38		$	35	$	5			12	%	$	11			31	%	$	126	$	108	$	18			17	%
Less: Restructuring charges and special items		—		—		—		—			—		—			—			—			—			—		—		—			—
Less: Notable items		3		—		—		—			—		3			100			3			100			3		—		3			100

Amortization of software, adjusted (non-GAAP)	$	43	$	41	$	39	$	38		$	35	$	2			5	%	$	8			23	%	$	123	$	108	$	15			14	%

Other operating expense, adjusted:
Other operating expense (GAAP)	$	144	$	128	$	115	$	125		$	133	$	16			13	%	$	11			8	%	$	387	$	405	($	18	)		(4	%)
Less: Restructuring charges and special items		—		—		—		—			—		—			—			—			—			—		3		(3	)		(100	)
Less: Notable items		14		—		—		—			—		14			100			14			100			14		—		14			100

Other operating expense, adjusted (non-GAAP)	$	130	$	128	$	115	$	125		$	133	$	2			2	%	($	3	)		(2	%)	$	373	$	402	($	29	)		(7	%)

Restructuring charges, special expense items and notable expense items include:
Restructuring charges	$	—	$	—	$	—	$	—		$	—	$	—			—	%	$	—			—	%	$	—	$	26	($	26	)		(100	)%
Special items		—		—		—		—			—		—			—			—			—			—		24		(24	)		(100	)
Notable items		36		—		—		—			—		36			100			36			100			36		—		36			100

Restructuring charges, special expense items and notable expense items	$	36	$	—	$	—	$	—		$	—	$	36			100	%	$	36			100	%	$	36	$	50	($	14	)		(28	%)

KEY PERFORMANCE METRICS, NON-GAAP FINANCIAL MEASURES AND RECONCILIATIONS - SEGMENTS

(dollars in millions)


		THREE MONTHS ENDED SEPT 30,												THREE MONTHS ENDED JUNE 30,												THREE MONTHS ENDED MAR 31,
		2016												2016												2016
		Consumer Banking			Commercial Banking			Other			Consolidated			Consumer Banking			Commercial Banking			Other			Consolidated			Consumer Banking			Commercial Banking			Other		Consolidated
Net income available to common stockholders:
Net income (GAAP)	A	$	92		$	162		$	43		$	297		$	90		$	164		($	11	)	$	243		$	71		$	133		$	19	$	223
Less: Preferred stock dividends			—			—			7			7			—			—			—			—			—			—			7		7

Net income available to common stockholders	B	$	92		$	162		$	36		$	290		$	90		$	164		($	11	)	$	243		$	71		$	133		$	12	$	216

Return on average tangible common equity:
Average common equity (GAAP)		$	5,190		$	5,172		$	9,448		$	19,810		$	5,110		$	5,040		$	9,618		$	19,768		$	5,089		$	4,790		$	9,688	$	19,567
Less: Average goodwill (GAAP)			—			—			6,876			6,876			—			—			6,876			6,876			—			—			6,876		6,876
Average other intangibles (GAAP)			—			—			1			1			—			—			2			2			—			—			3		3
Add: Average deferred tax liabilities related to goodwill (GAAP)			—			—			509			509			—			—			496			496			—			—			481		481

Average tangible common equity	C	$	5,190		$	5,172		$	3,080		$	13,442		$	5,110		$	5,040		$	3,236		$	13,386		$	5,089		$	4,790		$	3,290	$	13,169

Return on average tangible common equity	B/C		7.04	%		12.50	%		NM			8.58	%		7.09	%		13.04	%		NM			7.30	%		5.59	%		11.19	%		NM		6.61	%
Return on average total tangible assets:
Average total assets (GAAP)		$	56,689		$	47,902		$	39,808		$	144,399		$	55,660		$	47,388		$	39,131		$	142,179		$	55,116		$	45,304		$	38,360	$	138,780
Less: Average goodwill (GAAP)			—			—			6,876			6,876			—			—			6,876			6,876			—			—			6,876		6,876
Average other intangibles (GAAP)			—			—			1			1			—			—			2			2			—			—			3		3
Add: Average deferred tax liabilities related to goodwill (GAAP)			—			—			509			509			—			—			496			496			—			—			481		481

Average tangible assets	D	$	56,689		$	47,902		$	33,440		$	138,031		$	55,660		$	47,388		$	32,749		$	135,797		$	55,116		$	45,304		$	31,962	$	132,382

Return on average total tangible assets	A/D		0.64	%		1.35	%		NM			0.86	%		0.65	%		1.39	%		NM			0.72	%		0.52	%		1.18	%		NM		0.68	%
Efficiency ratio:
Noninterest expense (GAAP)	E	$	650		$	181		$	36		$	867		$	632		$	186		$	9		$	827		$	616		$	187		$	8	$	811
Net interest income (GAAP)			621			327			(3	)		945			602			314			7			923			581			300			23		904
Noninterest income (GAAP)			229			123			83			435			219			122			14			355			208			99			23		330

Total revenue (GAAP)	F	$	850		$	450		$	80		$	1,380		$	821		$	436		$	21		$	1,278		$	789		$	399		$	46	$	1,234

Efficiency ratio	E/F		76.46	%		40.21	%		NM			62.88	%		76.98	%		42.88	%		NM			64.71	%		78.08	%		46.74	%		NM		65.66	%

KEY PERFORMANCE METRICS, NON-GAAP FINANCIAL MEASURES AND RECONCILIATIONS - SEGMENTS (CONTINUED)

(dollars in millions)


		THREE MONTHS ENDED DEC 31,											THREE MONTHS ENDED SEPT 30,
		2015											2015
		Consumer Banking			Commercial Banking			Other		Consolidated			Consumer Banking			Commercial Banking			Other		Consolidated
Net income available to common stockholders:
Net income (loss) (GAAP)	A	$	67		$	152		$	2	$	221		$	68		$	145		$	7	$	220
Less: Preferred stock dividends			—			—			—		—			—			—			7		7

Net income available to common stockholders	B	$	67		$	152		$	2	$	221		$	68		$	145		$	—	$	213

Return on average tangible common equity:
Average common equity (GAAP)		$	4,831		$	4,787		$	9,741	$	19,359		$	4,791		$	4,722		$	9,748	$	19,261
Less: Average goodwill (GAAP)			—			—			6,876		6,876			—			—			6,876		6,876
Average other intangibles (GAAP)			—			—			3		3			—			—			4		4
Add: Average deferred tax liabilities related to goodwill (GAAP)			—			—			468		468			—			—			453		453

Average tangible common equity	C	$	4,831		$	4,787		$	3,330	$	12,948		$	4,791		$	4,722		$	3,321	$	12,834

Return on average tangible common equity	B/C		5.50	%		12.57	%		NM		6.75	%		5.67	%		12.24	%		NM		6.60	%
Return on average total tangible assets:
Average total assets (GAAP)		$	54,065		$	43,835		$	38,398	$	136,298		$	53,206		$	43,113		$	38,784	$	135,103
Less: Average goodwill (GAAP)			—			—			6,876		6,876			—			—			6,876		6,876
Average other intangibles (GAAP)			—			—			3		3			—			—			4		4
Add: Average deferred tax liabilities related to goodwill (GAAP)			—			—			468		468			—			—			453		453

Average tangible assets	D	$	54,065		$	43,835		$	31,987	$	129,887		$	53,206		$	43,113		$	32,357	$	128,676

Return on average total tangible assets	A/D		0.49	%		1.37	%		NM		0.67	%		0.51	%		1.34	%		NM		0.68	%
Efficiency ratio:
Noninterest expense (GAAP)	E	$	624		$	180		$	6	$	810		$	623		$	175		$	—	$	798
Net interest income (GAAP)			565			301			4		870			556			299			1		856
Noninterest income (GAAP)			226			107			29		362			235			100			18		353

Total revenue (GAAP)	F	$	791		$	408		$	33	$	1,232		$	791		$	399		$	19	$	1,209

Efficiency ratio	E/F		78.85	%		44.02	%		NM		65.76	%		78.72	%		43.75	%		NM		66.02	%

KEY PERFORMANCE METRICS, NON-GAAP FINANCIAL MEASURES AND RECONCILIATIONS - SEGMENTS (CONTINUED)

(dollars in millions)


		FOR THE NINE MONTHS ENDED SEPT 30,
		2016											2015
		Consumer Banking			Commercial Banking			Other		Consolidated			Consumer Banking			Commercial Banking			Other			Consolidated
Net income available to common stockholders:
Net income (loss) (GAAP)	A	$	253		$	459		$	51	$	763		$	195		$	427		($	3	)	$	619
Less: Preferred stock dividends			—			—			14		14			—			—			7			7

Net income available to common stockholders	B	$	253		$	459		$	37	$	749		$	195		$	427		($	10	)	$	612

Return on average tangible common equity:
Average common equity (GAAP)		$	5,130		$	5,001		$	9,584	$	19,715		$	4,708		$	4,625		$	10,019		$	19,352
Less: Average goodwill (GAAP)			—			—			6,876		6,876			—			—			6,876			6,876
Average other intangibles (GAAP)			—			—			2		2			—			—			5			5
Add: Average deferred tax liabilities related to goodwill (GAAP)			—			—			495		495			—			—			438			438

Average tangible common equity	C	$	5,130		$	5,001		$	3,201	$	13,332		$	4,708		$	4,625		$	3,576		$	12,909

Return on average tangible common equity	B/C		6.58	%		12.27	%		NM		7.51	%		5.55	%		12.35	%		NM			6.34	%
Return on average total tangible assets:
Average total assets (GAAP)		$	55,825		$	46,869		$	39,101	$	141,795		$	52,438		$	42,451		$	39,766		$	134,655
Less: Average goodwill (GAAP)			—			—			6,876		6,876			—			—			6,876			6,876
Average other intangibles (GAAP)			—			—			2		2			—			—			5			5
Add: Average deferred tax liabilities related to goodwill (GAAP)			—			—			495		495			—			—			438			438

Average tangible assets	D	$	55,825		$	46,869		$	32,718	$	135,412		$	52,438		$	42,451		$	33,323		$	128,212

Return on average total tangible assets	A/D		0.60	%		1.31	%		NM		0.75	%		0.50	%		1.35	%		NM			0.65	%
Efficiency ratio:
Noninterest expense (GAAP)	E	$	1,898		$	554		$	53	$	2,505		$	1,832		$	529		$	88		$	2,449
Net interest income (GAAP)			1,804			941			27		2,772			1,633			861			38			2,532
Noninterest income (GAAP)			656			344			120		1,120			684			308			68			1,060

Total revenue (GAAP)	F	$	2,460		$	1,285		$	147	$	3,892		$	2,317		$	1,169		$	106		$	3,592

Efficiency ratio	E/F		77.15	%		43.15	%		NM		64.36	%		79.07	%		45.26	%		NM			68.17	%

FORWARD-LOOKING STATEMENTS

This document contains forward-looking statements within the Private Securities Litigation Reform Act of 1995. Statements regarding potential future share repurchases and future dividends are forward-looking statements. Also, any statement that does not describe historical or current facts is a forward-looking statement. These statements often include the words “believes,” “expects,” “anticipates,” “estimates,” “intends,” “plans,” “goals,” “targets,” “initiatives,” “potentially,” “probably,” “projects,” “outlook” or similar expressions or future conditional verbs such as “may,” “will,” “should,” “would,” and “could.”

Forward-looking statements are based upon the current beliefs and expectations of management, and on information currently available to management. Our statements speak as of the date hereof, and we do not assume any obligation to update these statements or to update the reasons why actual results could differ from those contained in such statements in light of new information or future events. We caution you, therefore, against relying on any of these forward-looking statements. They are neither statements of historical fact nor guarantees or assurances of future performance. While there is no assurance that any list of risks and uncertainties or risk factors is complete, important factors that could cause actual results to differ materially from those in the forward-looking statements include the following, without limitation:

•

negative economic conditions that adversely affect the general economy, housing prices, the job market, consumer confidence and spending habits which may affect, among other things, the level of nonperforming assets, charge-offs and provision expense;

•

the rate of growth in the economy and employment levels, as well as general business and economic conditions;

•

our ability to implement our strategic plan, including the cost savings and efficiency components, and achieve our indicative performance targets;

•

our ability to remedy regulatory deficiencies and meet supervisory requirements and expectations;

•

liabilities and business restrictions resulting from litigation and regulatory investigations;

•

our capital and liquidity requirements (including under regulatory capital standards, such as the Basel III capital standards) and our ability to generate capital internally or raise capital on favorable terms;

•

the effect of the current low interest rate environment or changes in interest rates on our net interest income, net interest margin and our mortgage originations, mortgage servicing rights and mortgages held for sale;

•

changes in interest rates and market liquidity, as well as the magnitude of such changes, which may reduce interest margins, impact funding sources and affect the ability to originate and distribute financial products in the primary and secondary markets;

•

the effect of changes in the level of checking or savings account deposits on our funding costs and net interest margin;

•

financial services reform and other current, pending or future legislation or regulation that could have a negative effect on our revenue and businesses, including the Dodd-Frank Act and other legislation and regulation relating to bank products and services;

•

a failure in or breach of our operational or security systems or infrastructure, or those of our third party vendors or other service providers, including as a result of cyber attacks; and

•

management’s ability to identify and manage these and other risks.

In addition to the above factors, we also caution that the amount and timing of any future common stock dividends or share repurchases will depend on our financial condition, earnings, cash needs, regulatory constraints, capital requirements (including requirements of our subsidiaries), and any other factors that our Board of Directors deems relevant in making such a determination. Therefore, there can be no assurance that we will pay any dividends to holders of our common stock, or as to the amount of any such dividends.

More information about factors that could cause actual results to differ materially from those described in the forward-looking statements can be found under “Risk Factors” in Part I, Item 1A in our Annual Report on Form 10-K filed with the United States Securities and Exchange Commission on February 26, 2016.

CITIZENS FINANCIAL GROUP INC/RI - FORM 8-K - EX-99.3 - October 21, 2016

Attached files

CITIZENS FINANCIAL GROUP INC/RI Reports