8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the
 Securities Exchange Act of 1934

Date of Report (Date of earliest event reported) July 17, 2003

National Commerce Financial Corporation

(Exact name of registrant as specified in its charter)

Tennessee	0-6094	62-0784645
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

One Commerce Square, Memphis, Tennessee 38150

(Address of principal executive offices)

Registrant’s telephone number, including area code (901) 523-3434

N/A

(Former name or former address, if changed since last report)

Item 7. Financial Statements and Exhibits.

The following exhibits are furnished pursuant to Items 9 and 12 (reported herein under the Item 9 caption in accordance with the guidance provided in SEC Release Nos. 33-8216 and 34-47583), is not to be considered “filed” under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and shall not be incorporated by reference into any previous or future filing by the Registrant under the Securities Act of 1933, as amended (the “Securities Act”) or the Exchange Act:

Exhibit No. 99.1 News Release.

Exhibit No. 99.2 Supplemental Financial Tables.

Item 9. Regulation FD Disclosure (Furnished under Items 9 and 12 Pursuant to SEC Release Nos. 33-8216 and 34-47583)

On July 17, 2003, the Registrant issued an earnings release for the quarter ended June 30, 2003, a copy of which is furnished as Exhibit 99.1 to this Current Report.

After filing this Current Report, the Registrant will hold an investor conference call and webcast to discuss financial results for the first quarter ended June 30, 2003. Furnished with this Current Report as Exhibit 99.2 pursuant to Regulation FD and Item 9 of Form 8-K are Supplemental Financial Tables. The contents of these Supplemental Financial Tables will be discussed by the Registrant’s management and otherwise disclosed during the conference call and webcast. All information in the Supplemental Financial Tables is presented as of June 30, 2003 and the Registrant does not assume any obligation to correct or update said information in the future.

All of the foregoing information is furnished by the Registrant pursuant to Items 9 and 12 of Form 8-K in accordance with the guidance provided in SEC Release Nos. 33-8216 and 34-47583 and is not to be considered “filed” under the Exchange Act, and shall not be incorporated by reference into any previous or future filing by the Registrant under the Securities Act or the Exchange Act.

2

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	NATIONAL COMMERCE FINANCIAL CORPORATION                         Registrant
Date:  July 17, 2003	By:	/S/    JOHN M. PRESLEY
		John M. Presley Chief Financial Officer

3

EX-99.1

Exhibit 99.1

One Commerce Square

Memphis, TN 38150

FOR IMMEDIATE RELEASE

Investor Relations Contact:

M.J.A. “Jekka” Pinckney

901.523.3525

Media Contact: Eileen Sarro

919.683.7642

National Commerce Financial Reports Second Quarter Earnings

Atlanta de novo expansion profitable in record 14 months

Second Quarter Highlights

• Diluted EPS of $.35

• Diluted operating EPS of $.40

• Diluted operating cash EPS of $.44

• Revenues increased 26.1 percent annualized versus 1Q03

• Period end loans increased 20.2 percent annualized versus 1Q03

- 17.3 percent annualized excluding mortgage loans held for sale

• Period end non interest bearing deposits increased 45.9 percent annualized versus 1Q03

• Non interest income excluding securities gains increased 56.6 percent annualized versus 1Q03

• Non performing assets improved to .51 percent

• Net charge offs remained low at .28 percent

• Additional steps taken to reduce interest rate risk

• Atlanta de novo expansion reached break even in June

• Quarterly cash dividend increased 17.6 percent

MEMPHIS, Tennessee, (July 17, 2003)—National Commerce Financial Corporation (NYSE: NCF) today announced second quarter 2003 net income of $71.5 million and net income per diluted share of $.35. Net income and net income per diluted share in the second quarter of 2003 were reduced by $9.8 million after-tax, or $.05 per diluted share, from expenses related to the termination of employment contracts and the proposed settlement of a class action lawsuit against its First Mercantile business unit. Excluding these expenses, second quarter operating earnings and operating earnings per diluted share were $81.4 million and $.40, respectively.

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Operating cash earnings, defined as net income adjusted to exclude core deposit amortization, conversion/merger, employment contract termination, and the First Mercantile litigation expenses, net of tax, was $90.9 million in the second quarter of 2003, up 19.0 percent annualized from $86.8 million in first quarter 2003. Operating cash earnings per diluted share was $.44, up 19.0 percent annualized from $.42 in first quarter 2003. The Company’s operating cash return on average tangible assets and return on average tangible shareholders’ equity were 1.75 percent and 25.90 percent, respectively, in the second quarter of 2003 versus 1.76 percent and 25.33 percent in first quarter 2003.

Earnings Summary

($ in thousands)	2Q03	1Q03	Annualized % Change
Net income	71,507	64,090	46.3	%
First Mercantile litigation	677	12,775
Employment contract termination	9,170
Operating earnings	81,354	76,865	23.4
Amortization of core deposit intangible	9,561	9,933
Operating cash earnings	90,915	86,798	19.0
(thousands)
Average diluted shares outstanding	205,701	206,756
($ in cents)
Net income per diluted share	.35	.31	51.6
Operating earnings per diluted share	.40	.37	32.4
Operating cash earnings per diluted share	.44	.42	19.0

“I am very encouraged by our second quarter results. Loan growth improved sharply over prior quarters. Combined with outstanding deposit growth, non-interest income, asset quality, and a sharp focus on non-interest expenses, we were able to deliver strong operating leverage,” said William R. Reed Jr., president and chief executive officer of NCF. “While historically low rates continue to challenge our industry’s lending margins, I am very optimistic about NCF’s outlook for the remainder of 2003 and into 2004. We have taken several steps to reduce our interest rate risk and each and every employee is extremely focused on generating revenue, controlling costs, and ensuring NCF offers the ultimate customer experience. Nowhere is this more evident than in our Atlanta expansion where we reached profitability in June.”

For the six months ended June 30, 2003, net income and net income per diluted share were $135.6 million and $.66, respectively, compared to $155.8 million and $.75 for the six months ended June 30, 2002. Net income and net income per diluted share for the first six months of 2003 were reduced by $22.6 million after-tax, or $.11 per diluted share, from employment contract terminations and the proposed First Mercantile lawsuit settlement expenses. Net income and net income per diluted share for the six months ended June 30, 2002, were reduced by $3.2 million after-tax, or $.02 per diluted share, from conversion/merger expenses. Operating earnings and operating earnings per diluted share, which exclude these expenses, were $158.2 million and $.77, respectively, in 2003 compared to $159.0 million and $.76 in 2002. Operating cash earnings and operating cash earnings per diluted share were $177.7 million and $.86, respectively, in 2003 compared to $180.7 million and $.87 in 2002.

ATLANTA EXPANSION

The Company’s de novo entry into Atlanta reached profitability in record time during the second quarter. Early profitability was achieved compared to prior de novo expansions due to the city’s introduction to added convenience and service, a more rapid implementation of a broader product set, and the use of

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new marketing techniques with our in-store partner, The Kroger Co. The Company is working closely with Kroger through joint marketing to identify, target, and retain shared customers. These efforts and the Company’s emphasis on deposits in the early phase of de novo expansions have led to significant deposit growth in a very short amount of time. End of period deposits increased to $321.4 million, up 43.1 percent annualized from first quarter 2003. End of period loans increased to $86.9 million, up $55.3 million from first quarter 2003.

To date, the franchise consists of 29 full service banking locations, one private banking team and one commercial lending team. The banking locations are comprised of 28 in-store and one traditional, with two in-store locations generating more than $45 million in deposits. Current plans are for one in-store and five of the 22 traditional branches acquired from Wachovia in 2003 to open by year-end 2003 as well as the ongoing addition of private banking and commercial capabilities. Additional Kroger in-store locations as well the remaining acquired Wachovia branches are planned but have not been determined for 2004.

NET INTEREST INCOME

Taxable equivalent net interest income totaled $188.4 million, an annualized increase of 8.7 percent from first quarter 2003. Taxable equivalent net interest income increased $4.0 million, primarily due to strong earning asset growth. Earning asset growth contributed approximately $6.0 million to the rise in taxable equivalent net interest income offset by a 12 basis point decline in the net interest margin. Loan growth improved significantly in the second quarter with double-digit annualized growth rates in average balances in the commercial and consumer categories as well as at First Market Bank (the Company’s 49 percent owned, Richmond, Virginia, based savings bank). End of period loans at First Market Bank increased to $533.8 million, up 24.6 percent annualized from first quarter 2003.

Period End Loans

($ in thousands)	2Q03		1Q03		Annualized % Change
Commercial	$	3,570,337	$	3,403,217	19.6
CRE		3,719,164		3,689,692	3.2
Consumer		4,128,195		3,966,994	16.3
Mortgage1		783,615		625,528	101.1
Other		210,135		211,742	(3.0	)
Total loans1		12,411,446		11,897,173	17.3
First Market Bank		533,840		502,893	24.6

¹ Excludes mortgage loans held for sale

The net interest margin for the second quarter of 2003 was 3.86 percent, down 12 basis points from 3.98 percent in the first quarter of 2003. During the quarter, the earning asset yield declined 27 basis points, compared to a 16 basis point decline in the cost of interest-bearing liabilities. The loan yield was the largest contributor to the decline in the earning asset yield, falling 27 basis points from 6.32 percent to 6.05 percent. Efforts to increase non-interest bearing deposits remain very successful. During the second quarter, end of period non-interest bearing deposits rose $273.5 million or 45.9 percent annualized versus first quarter 2003. End of period deposits at First Market Bank increased to $885.1 million, up 24.7 percent annualized from first quarter 2003.

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Period End Deposits

($ in thousands)	2Q03	1Q03	Annualized % Change
Non interest bearing	2,657,291	2,383,806	45.9
Savings, NOW, and Money Market	5,849,113	5,795,400	3.7
Jumbo and Brokered CDs	2,063,785	1,804,492	57.5
Time deposits	4,876,012	4,942,165	(5.4	)
Total deposits	15,446,201	14,925,863	13.9
First Market Bank	885,053	833,658	24.7

INTEREST RATE RISK

The Company continues to take additional steps to manage its balance sheet to a more neutral to slightly asset-sensitive position. During the second quarter, the Company converted $200 million of floating rate, LIBOR-based loans to a fixed-rate using interest rate swaps. Additionally, in early third quarter, $300 million of fixed rate Federal Home Loan Bank term borrowings with a weighted average interest rate of 3.92 percent were prepaid which will result in a third quarter 2003 charge of $9.8 million. The Company expects that the loss will be offset with gains from sales of branches and investment securities. In combination, these changes will reduce interest rate risk and add approximately $3.0 million of net interest income per quarter, improving the net interest margin. Lastly, due to the extremely low interest rate environment, the Company is considering curtailing and at times refraining from the reinvestment of cash flows from its investment portfolio, instead using proceeds to pay off wholesale funding and reduce its balance sheet which will improve capital ratios.

ASSET QUALITY

Industry-leading asset quality remains a hallmark of the Company. Second quarter asset quality ratio comparisons to the prior quarter are impacted by the reduction of average loan balances attributable to the residential mortgage securitization transaction in first quarter 2003. Net charge-offs were $8.9 million or .28 percent of average loans in the second quarter of 2003, up from $7.7 million or .24 percent of average loans in the first quarter of 2003. The second quarter net charge-off ratio would have been .26 percent had the average loan balances included in the securitization been included in the calculation.

Non-performing assets improved from the first quarter. At June 30, 2003, non-performing assets totaled $66.2 million or .51 percent of end of period loans, foreclosed real estate, and other repossessed assets, down from $67.8 million or .55 percent at March 31, 2003. Non-performing assets at June 30, 2003, included $33.8 million of non-performing loans, $24.0 million of foreclosed real estate, and $8.4 million of other repossessed assets.

The allowance for loan losses at June 30, 2003, was $167.3 million or 1.30 percent of end of period total loans, up from $162.8 million or 1.33 percent at March 31, 2003. The decline in the allowance for loan loss ratio was impacted by significant growth in the second quarter in mortgage loans held for sale. The current allowance provides a coverage level of 4.69 times second quarter annualized net charge-offs, 4.94 times non-performing loans, and 2.53 times non-performing assets, each significantly above industry levels.

NON-INTEREST INCOME

Second quarter 2003 non-interest income, excluding investment securities gains, increased 56.6 percent annualized over the first quarter of this year. While capital markets and mortgage banking revenues remain extremely strong, each reported business segment experienced double-digit annualized growth in

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the second quarter. Non-interest income from the Company’s Financial Enterprise businesses rose 84.5 percent annualized over first quarter.

Non-interest income at the Company’s capital markets business increased $5.9 million in second quarter 2003 to $21.0 million from $15.1 million in first quarter 2003. Mortgage banking contributed $17.1 million in non-interest income, up $3.2 million or 92.6 percent annualized over first quarter 2003, on over $1.4 billion of residential mortgage loan originations. At the current run rate, the December 2002 acquisition of Atlanta-based BancMortgage will pay for itself by December 2003.

Non-interest income from First Mercantile and the Company’s retail brokerage unit were up 33.8 percent and 83.2 percent annualized, respectively, over the first quarter of this year. First Market Bank, which is accounted for using the equity method of accounting, continues to be one of the fastest growing financial institutions in the U.S., contributing $1.1 million in non-interest income for the second quarter, up 62.6 percent annualized from first quarter 2003.

EFFICIENCY

The Company and each of its two business segments experienced positive operating leverage in second quarter allowing the banking, Financial Enterprise, and corporate operating cash efficiency ratios (which the Company defines as total non-interest expense, less core deposit amortization, conversion/merger, employment contract terminations, and the First Mercantile litigation expenses, divided by fully-taxable equivalent net interest income and non-interest income) to improve.

Operating Cash Efficiency Ratios

($ in thousands)	2Q03			1Q03			Annualized % Change
Banking revenues	$	254,407		$	244,849		15.6
Banking operating cash expense		116,980			115,279		5.9
Banking operating cash efficiency ratio		45.98	%		47.08	%
Financial Enterprise revenues		59,501			49,972		76.3
Financial Enterprise operating cash expense		40,893			34,731		71.0
Financial Enterprise cash efficiency ratio		68.73	%		69.50	%
NCF revenues		312,798			293,671		26.1
NCF cash operating expense		156,763			148,860		21.2
NCF operating cash efficiency ratio		50.12	%		50.69	%

Supplemental financial tables are available on the Company’s website at www.ncfcorp.com/releases.cfm.

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ABOUT NCF

National Commerce Financial Corporation, headquartered in Memphis, Tennessee, is a sales and marketing organization that delivers select financial and consulting services through a national network of banking and non-banking affiliates. With $23 billion in assets, NCF operates almost 500 branches in 14 of the nation’s fastest growing metropolitan areas throughout the southeast.

NON-GAAP FINANCIAL INFORMATION

This press release contains financial information determined by methods other than in accordance with Generally Accepted Accounting Principles (GAAP). NCF’s management uses these non-GAAP measures in their analysis of the Company’s performance. These measures adjust GAAP performance measures to exclude the effects of unusual litigation related expenses, conversion/merger expenses, and employment contract terminations as well as the amortization of core deposit intangibles. These non-GAAP measures may also exclude other significant gains or losses that are unusual in nature. Since these items and their impact on NCF’s performance are difficult to predict, management believes presentations of financial measures excluding the impact of these items provide useful supplemental information that is essential to a proper understanding of the operating results of NCF’s core businesses. These disclosures should not be viewed as a substitute for operating results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies.

FORWARD-LOOKING STATEMENTS

These statements constitute forward-looking statements (within the meaning of the Private Securities Litigation Reform Act of 1995), which involve significant risks and uncertainties. A variety of factors could cause actual results and experience to differ materially from the anticipated results or other expectations expressed in such forward-looking statements. NCF does not assume any obligation to update these forward-looking statements or to update the reasons why actual results could differ from those projected in the forward-looking statements. Factors that might cause such a difference include, but are not limited to competition from both financial and non-financial institutions; changes in interest rates, deposit flows, loan demand and real estate values; changes in legislation or regulation; changes in accounting principles, policies or guidelines; the timing and occurrence (or non-occurrence) of transactions and events that may be subject to circumstances beyond the control of NCF; and other economic, competitive, governmental, regulatory and technological factors affecting NCF specifically or the banking industry or economy generally.

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NATIONAL COMMERCE FINANCIAL CORPORATION

Current Quarter Financial Highlights

(In Thousands Except Share and Per Share Data)

	Three Months Ended				% Change Fav/(Unfav)		Three Months Ended			% Change Fav/(Unfav)
	6/30/2003			3/31/2003			6/30/2003		6/30/2002
Earnings and Earnings Per Share
Revenues (TE)	$	312,798		293,671	6.5		312,798		285,892	9.4
Net income	$	71,507		64,090	11.6		71,507		80,868	(11.6	)
First Mercantile litigation, net of tax		677		12,775	(94.7	)	677		—	—
Employment contract terminations, net of tax		9,170		—	—		9,170		—	—
Operating earnings		81,354		76,865	5.8		81,354		80,868	.6
Amortization of core deposit, net of tax		9,561		9,933	(3.7	)	9,561		11,052	(13.5	)
Operating cash earnings	$	90,915		86,798	4.7		90,915		91,920	(1.1	)
Average basic shares outstanding		204,628,675		205,270,721			204,628,675		206,368,053
Average diluted shares outstanding		205,700,819		206,755,698			205,700,819		208,978,097
Basic EPS	$	.35		.31	12.9		.35		.39	(10.3	)
Diluted EPS		.35		.31	12.9		.35		.39	(10.3	)
Basic EPS—Operating		.40		.37	8.1		.40		.39	2.6
Diluted EPS—Operating		.40		.37	8.1		.40		.39	2.6
Basic EPS—Operating Cash		.44		.42	4.8		.44		.45	(2.2	)
Diluted EPS—Operating Cash		.44		.42	4.8		.44		.44	—
Key Performance Ratios
Net interest margin		3.86	%	3.98			3.86		4.33
Efficiency ratio		61.39		64.45			61.39		54.25
Operating cash efficiency ratio		50.12		50.69			50.12		46.47
Banking operating cash efficiency ratio		45.98		47.08			45.98		42.74
Return on average assets		1.29		1.22			1.29		1.60
Return on average equity		10.61		9.64			10.61		12.82
Cash return on average tangible assets		1.75		1.76			1.75		1.95
Cash return on average tangible equity		25.90		25.33			25.90		31.28
Asset Quality Ratios
Loan loss allowance to total loans		1.30	%	1.33			1.30		1.30
Net loans charged-off (annualized) to average loans		.28		.24			.28		.24
Nonperforming assets to loans plus foreclosed real
estate and other repossessed assets		.51		.55			.51		.53
Loan loss allowance to net charge-offs (annualized)		4.69	x	5.23			4.69		5.53
Loan loss allowance to nonperforming loans		4.94		4.96			4.94		5.30
Selected Average Balances
Assets	$	22,173,395		21,292,442	4.1		22,173,395		20,233,304	9.6
Loans		12,614,546		12,789,028	(1.4	)	12,614,546		12,335,537	2.3
Core deposits		13,056,980		12,734,843	2.5		13,056,980		12,405,823	5.2
Stockholders’ equity		2,702,937		2,695,846	.3		2,702,937		2,529,919	6.8
Selected Period End Balances
Assets	$	22,679,991		21,721,985	4.4		22,679,991		20,812,168	9.0
Loans		12,909,893		12,288,866	5.1		12,909,893		12,470,030	3.5
Core deposits		13,382,416		13,121,371	2.0		13,382,416		12,487,536	7.2
Stockholders’ equity		2,720,435		2,696,014	.9		2,720,435		2,596,386	4.8
Shares outstanding		204,384,778		205,009,566			204,384,778		206,417,264
Number of banking offices		482		483			482		466
Number of ATMs		556		559			556		554
Number of full-time equivalent employees (FTE)		5,582		5,564			5,582		5,469
Capital Ratios
Period-end tangible equity to period-end tangible assets		6.70	%	6.85			6.70		6.44
Risk-based capital ratios:
Tier 1 capital		11.23	E	10.50			11.23	E	10.49
Total capital		12.38	E	11.57			12.38	E	11.69
Leverage ratio		7.81	E	8.01			7.81	E	7.76

E—Estimated

NATIONAL COMMERCE FINANCIAL CORPORATION

Year to Date Financial Highlights

(In Thousands Except Share and Per Share Data)

	Six Months Ended				$ Change Fav/(Unfav)		% Change Fav/(Unfav)
	6/30/2003			6/30/2002
Earnings and Earnings Per Share
Revenues (TE)	$	606,469		557,246	49,223		8.8
Net income	$	135,597		155,767	(20,170	)	(12.9	)
Conversion/merger expenses, net of tax		—		3,211	(3,211	)	(100.0	)
First Mercantile litigation, net of tax		13,452		—	13,452		—
Employment contract terminations, net of tax		9,170		—	9,170		—
Operating earnings		158,219		158,978	(759	)	(.5	)
Amortization of core deposit, net of tax		19,494		21,672	(2,178	)	(10.0	)
Operating cash earnings	$	177,713		180,650	(2,937	)	(1.6	)
Average Basic Shares Outstanding		204,947,925		206,058,688
Average Diluted Shares Outstanding		206,225,344		208,634,557
Basic EPS	$	.66		.76	(.10	)	(13.2	)
Diluted EPS		.66		.75	(.09	)	(12.0	)
Basic EPS—Operating		.77		.77	.00		—
Diluted EPS—Operating		.77		.76	.01		1.3
Basic EPS—Operating Cash		.87		.88	(.01	)	(1.1	)
Diluted EPS—Operating Cash		.86		.87	(.01	)	(1.1	)
Key Performance Ratios
Net interest margin		3.92	%	4.36
Efficiency ratio		62.87		55.25
Operating cash efficiency ratio		50.39		46.50
Banking operating cash efficiency ratio		46.52		42.55
Return on average assets		1.26		1.58
Return on average equity		10.13		12.52
Cash return on average tangible assets		1.75		1.96
Cash return on average tangible equity		25.62		30.55
Asset Quality Ratios
Loan loss allowance to total loans		1.30	%	1.30
Net loans charged-off to average loans		.26		.25
Loan loss allowance to net charge-offs		5.00	x	5.30
Selected Average Balances
Assets	$	21,735,352		19,892,485	1,842,867		9.3
Loans		12,701,305		12,222,822	478,483		3.9
Core deposits		12,896,801		12,071,386	825,415		6.8
Stockholders’ equity		2,699,411		2,508,867	190,544		7.6

EX-99.2

Exhibit 99.2

NATIONAL COMMERCE FINANCIAL CORPORATION

Quarterly Financial Results

Second Quarter 2003

	Page
Highlights	2	Current Quarter Financial Highlights
		–       Second Quarter 2003 vs First Quarter 2003
		–       Second Quarter 2003 vs Second Quarter 2002
	3	Five Quarter Financial Highlights
	4	Year to Date Financial Highlights
Income Statement	5	Current Quarter Consolidated Statement of Income
		–       Second Quarter 2003 vs First Quarter 2003
		–       Second Quarter 2003 vs Second Quarter 2002
	6	Five Quarter Consolidated Statements of Income
	7	Year to Date Consolidated Statements of Income
	8	Current Quarter Operating Segment Statement of Income
		–       Second Quarter 2003 vs First Quarter 2003
		–       Second Quarter 2003 vs Second Quarter 2002
	9	Five Quarter Operating Segment Statements of Income
	10	Year to Date Operating Segment Statements of Income
Balance Sheet	11	Current Quarter Average Balance Sheet
		–       Second Quarter 2003 vs First Quarter 2003
		–       Second Quarter 2003 vs Second Quarter 2002
	12	Five Quarter Average Balance Sheets
	13	Year to Date Average Balance Sheets
	14	Current Quarter End of Period Balance Sheet
		–       Second Quarter 2003 vs First Quarter 2003
		–       Second Quarter 2003 vs Second Quarter 2002
	15	Five Quarter End of Period Balance Sheets
	16	Year to Date Rollforward of Stockholders’ Equity
Asset Quality	17	Current Quarter Asset Quality Analysis
		–       Second Quarter 2003 vs First Quarter 2003
		–       Second Quarter 2003 vs Second Quarter 2002
	18	Five Quarter Asset Quality Analysis
	19	Year to Date Asset Quality Analysis
Net Interest Margin	20	Five Quarter Average Balance Sheets and Net Interest Income Analysis
	21	Year to Date Average Balance Sheets and Net Interest Income Analysis

Page 1

NATIONAL COMMERCE FINANCIAL CORPORATION

Current Quarter Financial Highlights

(In Thousands Except Share and Per Share Data)

	Three Months Ended				% Change Fav/(Unfav)		Three Months Ended			% Change Fav/(Unfav)
	6/30/2003			3/31/2003			6/30/2003		6/30/2002
Earnings and Earnings Per Share
Revenues (TE)	$	312,798		293,671	6.5		312,798		285,892	9.4
Net income	$	71,507		64,090	11.6		71,507		80,868	(11.6	)
First Mercantile litigation, net of tax		677		12,775	(94.7	)	677		—	—
Employment contract terminations, net of tax		9,170		—	—		9,170		—	—
Operating earnings		81,354		76,865	5.8		81,354		80,868	.6
Amortization of core deposit, net of tax		9,561		9,933	(3.7	)	9,561		11,052	(13.5	)
Operating cash earnings	$	90,915		86,798	4.7		90,915		91,920	(1.1	)
Average basic shares outstanding		204,628,675		205,270,721			204,628,675		206,368,053
Average diluted shares outstanding		205,700,819		206,755,698			205,700,819		208,978,097
Basic EPS	$	.35		.31	12.9		.35		.39	(10.3	)
Diluted EPS		.35		.31	12.9		.35		.39	(10.3	)
Basic EPS—Operating		.40		.37	8.1		.40		.39	2.6
Diluted EPS—Operating		.40		.37	8.1		.40		.39	2.6
Basic EPS—Operating Cash		.44		.42	4.8		.44		.45	(2.2	)
Diluted EPS—Operating Cash		.44		.42	4.8		.44		.44	—
Key Performance Ratios
Net interest margin		3.86	%	3.98			3.86		4.33
Efficiency ratio		61.39		64.45			61.39		54.25
Operating cash efficiency ratio		50.12		50.69			50.12		46.47
Banking operating cash efficiency ratio		45.98		47.08			45.98		42.74
Return on average assets		1.29		1.22			1.29		1.60
Return on average equity		10.61		9.64			10.61		12.82
Cash return on average tangible assets		1.75		1.76			1.75		1.95
Cash return on average tangible equity		25.90		25.33			25.90		31.28
Asset Quality Ratios
Loan loss allowance to total loans		1.30	%	1.33			1.30		1.30
Net loans charged-off (annualized) to average loans		.28		.24			.28		.24
Nonperforming assets to loans plus foreclosed real
estate and other repossessed assets		.51		.55			.51		.53
Loan loss allowance to net charge-offs (annualized)		4.69	x	5.23			4.69		5.53
Loan loss allowance to nonperforming loans		4.94		4.96			4.94		5.30
Selected Average Balances
Assets	$	22,173,395		21,292,442	4.1		22,173,395		20,233,304	9.6
Loans		12,614,546		12,789,028	(1.4	)	12,614,546		12,335,537	2.3
Core deposits		13,056,980		12,734,843	2.5		13,056,980		12,405,823	5.2
Stockholders' equity		2,702,937		2,695,846	.3		2,702,937		2,529,919	6.8
Selected Period End Balances
Assets	$	22,679,991		21,721,985	4.4		22,679,991		20,812,168	9.0
Loans		12,909,893		12,288,866	5.1		12,909,893		12,470,030	3.5
Core deposits		13,382,416		13,121,371	2.0		13,382,416		12,487,536	7.2
Stockholders' equity		2,720,435		2,696,014	.9		2,720,435		2,596,386	4.8
Shares outstanding		204,384,778		205,009,566			204,384,778		206,417,264
Number of banking offices		482		483			482		466
Number of ATMs		556		559			556		554
Number of full-time equivalent employees (FTE)		5,582		5,564			5,582		5,469
Capital Ratios
Period-end tangible equity to period-end tangible assets		6.70	%	6.85			6.70		6.44
Risk-based capital ratios:
Tier 1 capital		11.23	E	10.50			11.23	E	10.49
Total capital		12.38	E	11.57			12.38	E	11.69
Leverage ratio		7.81	E	8.01			7.81	E	7.76

E—Estimated

Page 2

NATIONAL COMMERCE FINANCIAL CORPORATION

Five Quarter Financial Highlights

(In Thousands Except Share and Per Share Data)

	Three Months Ended
	6/30/2003			3/31/2003	12/31/2002	9/30/2002	6/30/2002
Earnings and Earnings Per Share
Revenues (TE)	$	312,798		293,671	300,137	296,670	285,892
Net income	$	71,507		64,090	84,866	82,977	80,868
First Mercantile litigation, net of tax		677		12,775	—	—	—
Employment contract terminations, net of tax		9,170		—	—	—	—
Operating earnings		81,354		76,865	84,866	82,977	80,868
Amortization of core deposit, net of tax		9,561		9,933	10,306	10,679	11,052
Operating cash earnings	$	90,915		86,798	95,172	93,656	91,920
Average Basic Shares Outstanding		204,628,675		205,270,721	205,360,814	206,258,720	206,368,053
Average Diluted Shares Outstanding		205,700,819		206,755,698	206,994,530	208,328,301	208,978,097
Basic EPS	$	.35		.31	.41	.40	.39
Diluted EPS		.35		.31	.41	.40	.39
Basic EPS—Operating		.40		.37	.41	.40	.39
Diluted EPS—Operating		.40		.37	.41	.40	.39
Basic EPS—Operating Cash		.44		.42	.46	.45	.45
Diluted EPS—Operating Cash		.44		.42	.46	.45	.44
Key Performance Ratios
Net interest margin		3.86	%	3.98	4.20	4.27	4.33
Efficiency ratio		61.39		64.45	55.25	54.16	54.25
Operating cash efficiency ratio		50.12		50.69	48.34	46.90	46.47
Banking operating cash efficiency ratio		45.98		47.08	43.79	42.73	42.74
Return on average assets		1.29		1.22	1.60	1.59	1.60
Return on average equity		10.61		9.64	12.70	12.63	12.82
Cash return on average tangible assets		1.75		1.76	1.92	1.92	1.95
Cash return on average tangible equity		25.90		25.33	28.37	29.22	31.28
Asset Quality Ratios
Loan loss allowance to total loans		1.30	%	1.33	1.26	1.28	1.30
Net loans charged-off (annualized) to average loans		.28		.24	.22	.29	.24
Nonperforming assets to loans plus foreclosed real estate and other repossessed assets		.51		.55	.51	.50	.53
Loan loss allowance to net charge-offs (annualized)		4.69 x		5.23	5.78	4.44	5.53
Loan loss allowance to nonperforming loans		4.94		4.96	5.30	5.51	5.30
Selected Average Balances
Assets	$	22,173,395		21,292,442	20,981,013	20,639,674	20,233,304
Loans		12,614,546		12,789,028	12,803,821	12,600,075	12,335,537
Core deposits		13,056,980		12,734,843	12,586,572	12,358,788	12,405,823
Stockholders’ equity		2,702,937		2,695,846	2,650,155	2,606,497	2,529,919
Selected Period End Balances
Assets	$	22,679,991		21,721,985	21,472,116	20,943,731	20,812,168
Loans		12,909,893		12,288,866	12,923,940	12,740,563	12,470,030
Core deposits		13,382,416		13,121,371	12,771,186	12,566,599	12,487,536
Stockholders’ equity		2,720,435		2,696,014	2,682,432	2,639,513	2,596,386
Shares outstanding		204,384,778		205,009,566	205,408,183	205,767,938	206,417,264
Number of banking offices		482		483	479	472	466
Number of ATMs		556		559	554	550	554
Number of full-time equivalent employees (FTE)		5,582		5,564	5,548	5,402	5,469
Capital Ratios
Period-end tangible equity to period-end tangible assets		6.70	%	6.85	6.79	6.69	6.44
Risk-based capital ratios:
Tier 1 capital		11.23	E	10.50	10.87	10.55	10.49
Total capital		12.38	E	11.57	12.00	11.74	11.69
Leverage ratio		7.81	E	8.01	7.91	7.85	7.76
E—Estimated

Page 3

NATIONAL COMMERCE FINANCIAL CORPORATION

Year to Date Financial Highlights

(In Thousands Except Share and Per Share Data)

	Six Months Ended				$ Change Fav/(Unfav)		% Change Fav/(Unfav)
	6/30/2003			6/30/2002
Earnings and Earnings Per Share
Revenues (TE)	$	606,469		557,246	49,223		8.8
Net income	$	135,597		155,767	(20,170	)	(12.9	)
Conversion/merger expenses, net of tax		—		3,211	(3,211	)	(100.0	)
First Mercantile litigation, net of tax		13,452		—	13,452		—
Employment contract terminations, net of tax		9,170		—	9,170		—
Operating earnings		158,219		158,978	(759	)	(.5	)
Amortization of core deposit, net of tax		19,494		21,672	(2,178	)	(10.0	)
Operating cash earnings	$	177,713		180,650	(2,937	)	(1.6	)
Average Basic Shares Outstanding		204,947,925		206,058,688
Average Diluted Shares Outstanding		206,225,344		208,634,557
Basic EPS	$	.66		.76	(.10	)	(13.2	)
Diluted EPS		.66		.75	(.09	)	(12.0	)
Basic EPS—Operating		.77		.77	.00		—
Diluted EPS—Operating		.77		.76	.01		1.3
Basic EPS—Operating Cash		.87		.88	(.01	)	(1.1	)
Diluted EPS—Operating Cash		.86		.87	(.01	)	(1.1	)
Key Performance Ratios
Net interest margin		3.92	%	4.36
Efficiency ratio		62.87		55.25
Operating cash efficiency ratio		50.39		46.50
Banking operating cash efficiency ratio		46.52		42.55
Return on average assets		1.26		1.58
Return on average equity		10.13		12.52
Cash return on average tangible assets		1.75		1.96
Cash return on average tangible equity		25.62		30.55
Asset Quality Ratios
Loan loss allowance to total loans		1.30	%	1.30
Net loans charged-off to average loans		.26		.25
Loan loss allowance to net charge-offs		5.00	x	5.30
Selected Average Balances
Assets	$	21,735,352		19,892,485	1,842,867		9.3
Loans		12,701,305		12,222,822	478,483		3.9
Core deposits		12,896,801		12,071,386	825,415		6.8
Stockholders’ equity		2,699,411		2,508,867	190,544		7.6

Page 4

NATIONAL COMMERCE FINANCIAL CORPORATION

Current Quarter Consolidated Statements of Income

(In Thousands Except Share and Per Share Data)

	Three Months Ended			% Change Fav/(Unfav)		Three Months Ended		% Change Fav/(Unfav)
	6/30/2003		3/31/2003			6/30/2003	6/30/2002
Income Statement
Loan income (TE)	$	190,239	199,861	(4.8	)	190,239	218,856	(13.1	)
Securities income (TE)		81,215	70,263	15.6		81,215	73,168	11.0
Other interest income (TE)		357	192	85.9		357	270	32.2
Total interest income (TE)		271,811	270,316	.6		271,811	292,294	(7.0	)
Savings/NOW and money market expense		11,006	11,957	8.0		11,006	18,527	40.6
Jumbo and brokered CD expense		7,378	7,189	(2.6	)	7,378	8,290	11.0
Consumer time deposit expense		36,800	38,142	3.5		36,800	45,046	18.3
Interest expense on deposits		55,184	57,288	3.7		55,184	71,863	23.2
Short-term borrowed funds expense		4,698	4,368	(7.6	)	4,698	4,461	(5.3	)
FHLB advances expense		21,397	22,118	3.3		21,397	22,626	5.4
Trust preferred securities and long-term debt expense		2,133	2,160	1.3		2,133	2,474	13.8
Total interest expense		83,412	85,934	2.9		83,412	101,424	17.8
Net interest income (TE)		188,399	184,382	2.2		188,399	190,870	(1.3	)
Taxable equivalent adjustment		7,218	6,940	(4.0	)	7,218	7,628	5.4
Net interest income		181,181	177,442	2.1		181,181	183,242	(1.1	)
Provision for loan losses		13,376	7,684	(74.1	)	13,376	8,713	(53.5	)
Net interest income after provision		167,805	169,758	(1.2	)	167,805	174,529	(3.9	)
Service charges on deposits		43,500	41,250	5.5		43,500	40,301	7.9
Other service charges and fees		9,721	9,341	4.1		9,721	9,696	.3
Broker/dealer revenue		28,152	21,081	33.5		28,152	17,650	59.5
Asset management		13,356	12,382	7.9		13,356	13,488	(1.0	)
Mortgage banking income		17,092	13,880	23.1		17,092	2,972	475.1
Equity earnings from First Market Bank		1,071	926	15.7		1,071	773	38.6
Other		9,047	7,965	13.6		9,047	8,448	7.1
Investment securities gains, net		2,460	2,464	(.2	)	2,460	1,694	45.2
Total noninterest income		124,399	109,289	13.8		124,399	95,022	30.9
Personnel		83,117	81,679	(1.8	)	83,117	68,373	(21.6	)
Occupancy		13,292	12,904	(3.0	)	13,292	12,209	(8.9	)
Equipment		7,992	7,405	(7.9	)	7,992	6,800	(17.5	)
Core deposit amortization		15,673	16,284	3.8		15,673	18,118	13.5
Other		52,362	46,872	(11.7	)	52,362	45,462	(15.2	)
First Mercantile litigation		1,041	19,654	94.7		1,041	—	—
Employment contract terminations		14,108	—	—		14,108	—	—
Total noninterest expense		187,585	184,798	(1.5	)	187,585	150,962	(24.3	)
Income before income taxes		104,619	94,249	11.0		104,619	118,589	(11.8	)
Income taxes		33,112	30,159	(9.8	)	33,112	37,721	12.2
Net income		71,507	64,090	11.6		71,507	80,868	(11.6	)
First Mercantile litigation, net of tax		677	12,775	(94.7	)	677	—	—
Employment contract terminations, net of tax		9,170	—	—		9,170	—	—
Operating earnings		81,354	76,865	5.8		81,354	80,868	.6
Amortization of core deposit, net of tax		9,561	9,933	(3.7	)	9,561	11,052	(13.5	)
Operating cash earnings	$	90,915	86,798	4.7		90,915	91,920	(1.1	)
Average Common Shares Outstanding
Basic		204,628,675	205,270,721			204,628,675	206,368,053
Diluted		205,700,819	206,755,698			205,700,819	208,978,097
Earnings and Dividends Per Share
Basic	$	.35	.31	12.9		.35	.39	(10.3	)
Diluted		.35	.31	12.9		.35	.39	(10.3	)
Basic operating		.40	.37	8.1		.40	.39	2.6
Diluted operating		.40	.37	8.1		.40	.39	2.6
Basic operating cash		.44	.42	4.8		.44	.45	(2.2	)
Diluted operating cash		.44	.42	4.8		.44	.44	—
Cash dividends		.17	.17	—		.17	.15	13.3

Page 5

NATIONAL COMMERCE FINANCIAL CORPORATION

Five Quarter Consolidated Statements of Income

(In Thousands Except Share and Per Share Data)

	Three Months Ended
	6/30/2003		3/31/2003	12/31/2002	9/30/2002	6/30/2002
Income Statement
Loan income (TE)	$	190,239	199,861	214,799	217,482	218,856
Securities income (TE)		81,215	70,263	71,601	73,283	73,168
Other interest income (TE)		357	192	199	217	270
Total interest income (TE)		271,811	270,316	286,599	290,982	292,294
Savings/NOW and money market expense		11,006	11,957	14,036	15,605	18,527
Jumbo and brokered CD expense		7,378	7,189	8,281	8,611	8,290
Consumer time deposit expense		36,800	38,142	40,878	41,651	45,046
Interest expense on deposits		55,184	57,288	63,195	65,867	71,863
Short-term borrowed funds expense		4,698	4,368	4,463	5,393	4,461
FHLB advances expense		21,397	22,118	23,667	24,010	22,626
Trust preferred securities and long-term debt expense		2,133	2,160	2,458	2,410	2,474
Total interest expense		83,412	85,934	93,783	97,680	101,424
Net interest income (TE)		188,399	184,382	192,816	193,302	190,870
Taxable equivalent adjustment		7,218	6,940	6,993	7,442	7,628
Net interest income		181,181	177,442	185,823	185,860	183,242
Provision for loan losses		13,376	7,684	7,127	10,990	8,713
Net interest income after provision		167,805	169,758	178,696	174,870	174,529
Service charges on deposits		43,500	41,250	43,884	41,391	40,301
Other service charges and fees		9,721	9,341	9,736	9,971	9,696
Broker/dealer revenue		28,152	21,081	22,982	19,600	17,650
Asset management		13,356	12,382	11,743	12,785	13,488
Mortgage banking income		17,092	13,880	6,896	5,350	2,972
Equity earnings from First Market Bank		1,071	926	1,084	1,074	773
Other		9,047	7,965	8,968	8,137	8,448
Investment securities gains, net		2,460	2,464	2,028	5,060	1,694
Total noninterest income		124,399	109,289	107,321	103,368	95,022
Personnel		83,117	81,679	75,630	71,149	68,373
Occupancy		13,292	12,904	12,866	12,434	12,209
Equipment		7,992	7,405	7,707	7,454	6,800
Core deposit amortization		15,673	16,284	16,895	17,507	18,118
Other		52,362	46,872	48,873	48,114	45,462
First Mercantile litigation		1,041	19,654	—	—	—
Employment contract terminations		14,108	—	—	—	—
Total noninterest expense		187,585	184,798	161,971	156,658	150,962
Income before income taxes		104,619	94,249	124,046	121,580	118,589
Income taxes		33,112	30,159	39,180	38,603	37,721
Net income		71,507	64,090	84,866	82,977	80,868
First Mercantile litigation, net of tax		677	12,775	—	—	—
Employment contract terminations, net of tax		9,170	—	—	—	—
Operating earnings		81,354	76,865	84,866	82,977	80,868
Amortization of core deposit, net of tax		9,561	9,933	10,306	10,679	11,052
Operating cash earnings	$	90,915	86,798	95,172	93,656	91,920
Average Common Shares Outstanding
Basic		204,628,675	205,270,721	205,360,814	206,258,720	206,368,053
Diluted		205,700,819	206,755,698	206,994,530	208,328,301	208,978,097
Earnings and Dividends Per Share
Basic	$	.35	.31	.41	.40	.39
Diluted		.35	.31	.41	.40	.39
Basic operating		.40	.37	.41	.40	.39
Diluted operating		.40	.37	.41	.40	.39
Basic operating cash		.44	.42	.46	.45	.45
Diluted operating cash		.44	.42	.46	.45	.44
Cash dividends		.17	.17	.17	.17	.15

Page 6

NATIONAL COMMERCE FINANCIAL CORPORATION

Year to Date Consolidated Statements of Income

(In Thousands Except Share and Per Share Data)

	Six Months Ended			$ Change Fav/(Unfav)		% Change Fav/(Unfav)
	6/30/2003		6/30/2002
Income Statement
Loan income (TE)	$	390,100	439,677	(49,577	)	(11.3	)
Securities income (TE)		151,478	142,111	9,367		6.6
Other interest income (TE)		549	587	(38	)	(6.5	)
Total interest income (TE)		542,127	582,375	(40,248	)	(6.9	)
Savings/NOW and money market expense		22,963	35,929	12,966		36.1
Jumbo and brokered CD expense		14,567	17,108	2,541		14.9
Consumer time deposit expense		74,942	93,660	18,718		20.0
Interest expense on deposits		112,472	146,697	34,225		23.3
Short-term borrowed funds expense		9,066	7,961	(1,105	)	(13.9	)
FHLB advances expense		43,515	45,815	2,300		5.0
Trust preferred securities and long-term debt expense		4,293	4,955	662		13.4
Total interest expense		169,346	205,428	36,082		17.6
Net interest income (TE)		372,781	376,947	(4,166	)	(1.1	)
Taxable equivalent adjustment		14,158	15,024	(866	)	(5.8	)
Net interest income		358,623	361,923	(3,300	)	(.9	)
Provision for loan losses		21,060	14,227	(6,833	)	(48.0	)
Net interest income after provision		337,563	347,696	(10,133	)	(2.9	)
Service charges on deposits		84,750	74,127	10,623		14.3
Other service charges and fees		19,062	18,674	388		2.1
Broker/dealer revenue		49,233	33,063	16,170		48.9
Asset management		25,738	26,388	(650	)	(2.5	)
Mortgage banking income		30,972	6,248	24,724		395.7
Equity earnings from First Market Bank		1,997	1,289	708		54.9
Other		17,012	16,096	916		5.7
Investment securities gains, net		4,924	4,414	510		11.6
Total noninterest income		233,688	180,299	53,389		29.6
Personnel		164,796	137,251	(27,545	)	(20.1	)
Occupancy		26,196	23,186	(3,010	)	(13.0	)
Equipment		15,397	13,027	(2,370	)	(18.2	)
Core deposit amortization		31,957	35,528	3,571		10.1
Other		99,234	85,667	(13,567	)	(15.8	)
First Mercantile litigation		20,695	—	(20,695	)	—
Employment contract terminations		14,108	—	(14,108	)	—
Conversion/merger expenses		—	4,940	4,940		100.0
Total noninterest expense		372,383	299,599	(72,784	)	(24.3	)
Income before income taxes		198,868	228,396	(29,528	)	(12.9	)
Income taxes		63,271	72,629	9,358		12.9
Net income		135,597	155,767	(20,170	)	(12.9	)
Conversion/merger expenses, net of tax		—	3,211	(3,211	)	(100.0	)
First Mercantile litigation, net of tax		13,452	—	13,452		—
Employment contract terminations, net of tax		9,170	—	9,170		—
Operating earnings		158,219	158,978	(759	)	(.5	)
Amortization of core deposit, net of tax		19,494	21,672	(2,178	)	(10.0	)
Operating cash earnings	$	177,713	180,650	(2,937	)	(1.6	)
Average Common Shares Outstanding
Basic		204,947,925	206,058,688
Diluted		206,225,344	208,634,557
Earnings and Dividends Per Share
Basic	$	.66	.76	(.10	)	(13.2	)
Diluted		.66	.75	(.09	)	(12.0	)
Basic operating		.77	.77	.00		—
Diluted operating		.77	.76	.01		1.3
Basic operating cash		.87	.88	(.01	)	(1.1	)
Diluted operating cash		.86	.87	(.01	)	(1.1	)
Cash dividends		.34	.30	.04		13.3

Page 7

NATIONAL COMMERCE FINANCIAL CORPORATION

Current Quarter Operating Segment Statement of Income

(In Thousands)

	Three Months Ended					% Change Fav/(Unfav)		Three Months Ended				% Change Fav/(Unfav)
	6/30/03			3/31/03				6/30/03		6/30/02
Traditional Banking
Net interest income (TE)	$	183,113		179,167		2.2		183,113		186,096		(1.6	)
Provision for loan losses		(13,376	)	(7,684	)	(74.1	)	(13,376	)	(8,713	)	(53.5	)
Noninterest income		71,294		65,682		8.5		71,294		55,459		28.6
Intangibles amortization		(15,673	)	(16,284	)	3.8		(15,673	)	(18,118	)	13.5
First Mercantile litigation		—		—		—		—		—		—
Employment contract terminations		(14,108	)	—		—		(14,108	)	—		—
Cash operating expense		(116,980	)	(115,279	)	(1.5	)	(116,980	)	(103,237	)	(13.3	)
Income before income taxes (TE)		94,270		105,602		(10.7	)	94,270		111,487		(15.4	)
Income taxes		33,479		38,820		13.8		33,479		39,605		15.5
Net income		60,791		66,782		(9.0	)	60,791		71,882		(15.4	)
First Mercantile litigation, net of tax		—		—		—		—		—		—
Employment contract terminations, net of tax		9,170		—		—		9,170		—		—
Operating earnings		69,961		66,782		4.8		69,961		71,882		(2.7	)
Amortization of core deposit, net of tax		9,561		9,933		(3.7	)	9,561		11,052		(13.5	)
Operating cash earnings	$	79,522		76,715		3.7		79,522		82,934		(4.1	)
Financial Enterprises
Net interest income (TE)	$	5,286		5,215		1.4		5,286		4,774		10.7
Provision for loan losses		—		—		—		—		—		—
Noninterest income		54,215		44,757		21.1		54,215		41,972		29.2
Intangibles amortization		—		—		—		—		—		—
First Mercantile litigation		(1,041	)	(19,654	)	94.7		(1,041	)	—		(100.0	)
Employment contract terminations		—		—		—		—		—		—
Cash operating expense		(40,893	)	(34,731	)	(17.7	)	(40,893	)	(32,016	)	(27.7	)
Income before income taxes (TE)		17,567		(4,413	)	(498.1	)	17,567		14,730		19.3
Income taxes		6,851		(1,721	)	498.1		6,851		5,744		(19.3	)
Net income		10,716		(2,692	)	(498.1	)	10,716		8,986		19.3
First Mercantile litigation, net of tax		677		12,775		94.7		677		—		100.0
Employment contract terminations, net of tax		—		—		—		—		—		—
Operating earnings		11,393		10,083		13.0		11,393		8,986		26.8
Amortization of core deposit, net of tax		—		—		—		—		—		—
Operating cash earnings	$	11,393		10,083		13.0		11,393		8,986		26.8
Fully Consolidated
Net interest income (TE)	$	188,399		184,382		2.2		188,399		190,870		(1.3	)
Provision for loan losses		(13,376	)	(7,684	)	(74.1	)	(13,376	)	(8,713	)	(53.5	)
Noninterest income		124,399		109,289		13.8		124,399		95,022		30.9
Intangibles amortization		(15,673	)	(16,284	)	3.8		(15,673	)	(18,118	)	13.5
First Mercantile litigation		(1,041	)	(19,654	)	94.7		(1,041	)	—		(100.0	)
Employment contract terminations		(14,108	)	—		(100.0	)	(14,108	)	—		(100.0	)
Cash operating expense		(156,763	)	(148,860	)	(5.3	)	(156,763	)	(132,844	)	(18.0	)
Income before income taxes (TE)		111,837		101,189		10.5		111,837		126,217		(11.4	)
Income taxes		40,330		37,099		(8.7	)	40,330		45,349		11.1
Net income		71,507		64,090		11.6		71,507		80,868		(11.6	)
First Mercantile litigation, net of tax		677		12,775		94.7		677		—		100.0
Employment contract terminations, net of tax		9,170		—		100.0		9,170		—		100.0
Operating earnings		81,354		76,865		5.8		81,354		80,868		.6
Amortization of core deposit, net of tax		9,561		9,933		(3.7	)	9,561		11,052		(13.5	)
Operating cash earnings	$	90,915		86,798		4.7		90,915		91,920		(1.1	)

(1) Inter-segment eliminations are not separately presented.

Page 8

NATIONAL COMMERCE FINANCIAL CORPORATION

Five Quarter Operating Segment Statements of Income

(In Thousands)

	Three Months Ended
	6/30/2003			3/31/2003		12/31/2002		9/30/2002		6/30/2002
Traditional Banking
Net interest income (TE)	$	183,113		179,167		186,708		187,947		186,096
Provision for loan losses		(13,376	)	(7,684	)	(7,127	)	(10,990	)	(8,713	)
Noninterest income		71,294		65,682		64,560		62,299		55,459
Intangibles amortization		(15,673	)	(16,284	)	(16,895	)	(17,507	)	(18,118	)
First Mercantile litigation		—		—		—		—		—
Employment contract terminations		(14,108	)	—		—		—		—
Cash operating expense		(116,980	)	(115,279	)	(110,040	)	(106,918	)	(103,237	)
Income before income taxes (TE)		94,270		105,602		117,206		114,831		111,487
Income taxes		33,479		38,820		40,778		40,510		39,605
Net income		60,791		66,782		76,428		74,321		71,882
First Mercantile litigation, net of tax		—		—		—		—		—
Employment contract terminations, net of tax		9,170		—		—		—		—
Operating earnings		69,961		66,782		76,428		74,321		71,882
Amortization of core deposit, net of tax		9,561		9,933		10,306		10,679		11,052
Operating cash earnings	$	79,522		76,715		86,734		85,000		82,934
Financial Enterprises
Net interest income (TE)	$	5,286		5,215		6,108		5,355		4,774
Provision for loan losses		—		—		—		—		—
Noninterest income		54,215		44,757		44,367		42,835		41,972
Intangibles amortization		—		—		—		—		—
First Mercantile litigation		(1,041	)	(19,654	)	—		—		—
Employment contract terminations		—		—		—		—		—
Cash operating expense		(40,893	)	(34,731	)	(36,642	)	(33,999	)	(32,016	)
Income before income taxes (TE)		17,567		(4,413	)	13,833		14,191		14,730
Income taxes		6,851		(1,721	)	5,395		5,535		5,744
Net income		10,716		(2,692	)	8,438		8,656		8,986
First Mercantile litigation, net of tax		677		12,775		—		—		—
Employment contract terminations, net of tax		—		—		—		—		—
Operating earnings		11,393		10,083		8,438		8,656		8,986
Amortization of core deposit, net of tax		—		—		—		—		—
Operating cash earnings	$	11,393		10,083		8,438		8,656		8,986
Fully Consolidated
Net interest income (TE)	$	188,399		184,382		192,816		193,302		190,870
Provision for loan losses		(13,376	)	(7,684	)	(7,127	)	(10,990	)	(8,713	)
Noninterest income		124,399		109,289		107,321		103,368		95,022
Intangibles amortization		(15,673	)	(16,284	)	(16,895	)	(17,507	)	(18,118	)
First Mercantile litigation		(1,041	)	(19,654	)	—		—		—
Employment contract terminations		(14,108	)	—		—		—		—
Cash operating expense		(156,763	)	(148,860	)	(145,076	)	(139,151	)	(132,844	)
Income before income taxes (TE)		111,837		101,189		131,039		129,022		126,217
Income taxes		40,330		37,099		46,173		46,045		45,349
Net income		71,507		64,090		84,866		82,977		80,868
First Mercantile litigation, net of tax		677		12,775		—		—		—
Employment contract terminations, net of tax		9,170		—		—		—		—
Operating earnings		81,354		76,865		84,866		82,977		80,868
Amortization of core deposit, net of tax		9,561		9,933		10,306		10,679		11,052
Operating cash earnings	$	90,915		86,798		95,172		93,656		91,920

(1) Inter-segment eliminations are not separately presented.

Page 9

NATIONAL COMMERCE FINANCIAL CORPORATION

Year to Date Operating Segment Statements of Income

(In Thousands)

	Six Months Ended					$ Change Fav/(Unfav)		% Change Fav/(Unfav)
	6/30/2003			6/30/2002
Traditional Banking
Net interest income (TE)	$	362,280		367,719		(5,439	)	(1.5	)
Provision for loan losses		(21,060	)	(14,227	)	(6,833	)	(48.0	)
Noninterest income		136,976		103,552		33,424		32.3
Intangibles amortization		(31,957	)	(35,528	)	3,571		10.1
First Mercantile litigation		—		—		—		—
Employment contract terminations		(14,108	)	—		(14,108	)	—
Conversion/merger expenses		—		(4,940	)	4,940		100.0
Cash operating expense		(232,259	)	(200,534	)	(31,725	)	(15.8	)
Income before income taxes (TE)		199,872		216,042		(16,170	)	(7.5	)
Income taxes		72,299		76,976		4,677		6.1
Net income		127,573		139,066		(11,493	)	(8.3	)
Conversion/merger expenses, net of tax		—		3,211		(3,211	)	(100.0	)
First Mercantile litigation, net of tax		—		—		—		—
Employment contract terminations, net of tax		9,170		—		9,170		—
Operating earnings		136,743		142,277		(5,534	)	(3.9	)
Amortization of core deposit, net of tax		19,494		21,672		(2,178	)	(10.0	)
Operating cash earnings	$	156,237		163,949		(7,712	)	(4.7	)
Financial Enterprises
Net interest income (TE)	$	10,501		9,228		1,273		13.8
Provision for loan losses		—		—		—		—
Noninterest income		98,972		80,308		18,664		23.2
Intangibles amortization		—		—		—		—
First Mercantile litigation		(20,695	)	—		(20,695	)	(100.0	)
Employment contract terminations		—		—
Conversion/merger expenses		—		—		—		—
Cash operating expense		(75,624	)	(62,158	)	(13,466	)	(21.7	)
Income before income taxes (TE)		13,154		27,378		(14,224	)	(52.0	)
Income taxes		5,130		10,677		5,547		52.0
Net income		8,024		16,701		(8,677	)	(52.0	)
Conversion/merger expenses, net of tax		—		—		—		—
First Mercantile litigation, net of tax		13,452		—		13,452		100.0
Employment contract terminations, net of tax		—		—		—		—
Operating earnings		21,476		16,701		4,775		28.6
Amortization of core deposit, net of tax		—		—		—		—
Operating cash earnings	$	21,476		16,701		4,775		28.6
Fully Consolidated
Net interest income (TE)	$	372,781		376,947		(4,166	)	(1.1	)
Provision for loan losses		(21,060	)	(14,227	)	(6,833	)	(48.0	)
Noninterest income		233,688		180,299		53,389		29.6
Intangibles amortization		(31,957	)	(35,528	)	3,571		10.1
First Mercantile litigation		(20,695	)	—		(20,695	)	(100.0	)
Employment contract terminations		(14,108	)	—		(14,108	)	(100.0	)
Conversion/merger expenses		—		(4,940	)	4,940		100.0
Cash operating expense		(305,623	)	(259,131	)	(46,492	)	(17.9	)
Income before income taxes (TE)		213,026		243,420		(30,394	)	(12.5	)
Income taxes		77,429		87,653		10,224		11.7
Net income		135,597		155,767		(20,170	)	(12.9	)
Conversion/merger expenses, net of tax		—		3,211		(3,211	)	(100.0	)
First Mercantile litigation, net of tax		13,452		—		13,452		100.0
Employment contract terminations, net of tax		9,170		—		9,170		100.0
Operating earnings		158,219		158,978		(759	)	(.5	)
Amortization of core deposit, net of tax		19,494		21,672		(2,178	)	(10.0	)
Operating cash earnings	$	177,713		180,650		(2,937	)	(1.6	)

(1) Inter-segment eliminations are not separately presented.

Page 10

NATIONAL COMMERCE FINANCIAL CORPORATION

Current Quarter Average Balance Sheet

(In Thousands)

	Three Months Ended			% Inc/(Decr)		Three Months Ended			% Inc/(Decr)
	6/30/2003		3/31/2003			6/30/2003	6/30/2002
Assets
Cash and due from banks	$	422,653	398,564	6.0		422,653	436,473		(3.2	)
Time deposits in other banks		5,742	9,575	(40.0	)	5,742	22,411		(74.4	)
Federal funds sold and other short-term investments		107,462	51,187	109.9		107,462	21,187		407.2
Investment securities (1)		6,674,537	5,706,704	17.0		6,674,537	5,197,443		28.4
Trading securities		120,999	87,496	38.3		120,999	89,229		35.6
Loans:
Commercial		3,492,900	3,350,959	4.2		3,492,900	3,062,154		14.1
Construction and commercial real estate		3,690,766	3,677,697	.4		3,690,766	3,526,901		4.6
Mortgage (including loans held for sale)		1,159,296	1,601,618	(27.6	)	1,159,296	1,663,703		(30.3	)
Consumer		4,059,490	3,945,287	2.9		4,059,490	3,880,490		4.6
Revolving credit		78,142	76,939	1.6		78,142	68,573		14.0
Lease financing		133,952	136,528	(1.9	)	133,952	133,716		.2
Total loans		12,614,546	12,789,028	(1.4	)	12,614,546	12,335,537		2.3
Allowance for loan losses		164,108	163,203	.6		164,108	160,711		2.1
Net loans		12,450,438	12,625,825	(1.4	)	12,450,438	12,174,826		2.3
Bank owned life insurance		231,397	228,214	1.4		231,397	217,458		6.4
Investment in First Market Bank		29,248	28,353	3.2		29,248	25,317		15.5
Premises and equipment		276,227	258,614	6.8		276,227	247,739		11.5
Goodwill		1,082,077	1,077,121	.5		1,082,077	1,070,724		1.1
Core deposit intangibles		213,065	229,044	(7.0	)	213,065	280,701		(24.1	)
Other assets		559,550	591,745	(5.4	)	559,550	449,796		24.4
Total assets	$	22,173,395	21,292,442	4.1		22,173,395	20,233,304		9.6
Liabilities
Deposits:
Demand deposits (noninterest-bearing)	$	2,375,641	2,140,299	11.0		2,375,641	1,923,408		23.5
Savings, NOW and money market accounts		5,765,351	5,684,696	1.4		5,765,351	5,800,664		(.6	)
Jumbo and brokered certificates of deposit		2,032,881	1,796,198	13.2		2,032,881	1,533,119		32.6
Time deposits		4,915,988	4,909,848	.1		4,915,988	4,681,751		5.0
Total deposits		15,089,861	14,531,041	3.8		15,089,861	13,938,942		8.3
Short-term borrowings		1,388,604	1,249,458	11.1		1,388,604	1,124,318		23.5
FHLB advances		2,197,173	2,056,896	6.8		2,197,173	1,949,166		12.7
Trust preferred securities and long-term debt		299,247	296,745	.8		299,247	282,053		6.1
Other liabilities		495,573	462,456	7.2		495,573	408,906		21.2
Total liabilities		19,470,458	18,596,596	4.7		19,470,458	17,703,385		10.0
Stockholders' Equity
Common stock		409,257	410,541	(.3	)	409,257	412,736		(.8	)
Additional paid-in capital		1,735,104	1,749,408	(.8	)	1,735,104	1,780,106		(2.5	)
Retained earnings		512,491	485,214	5.6		512,491	344,678		48.7
Accumulated other comprehensive income		46,085	50,683	(9.1	)	46,085	(7,601	)	(706.3	)
Total stockholders' equity		2,702,937	2,695,846	.3		2,702,937	2,529,919		6.8
Total liabilities and stockholders' equity	$	22,173,395	21,292,442	4.1		22,173,395	20,233,304		9.6

(1) Average balances exclude the mark-to-market adjustment for Statement of Financial Accounting Standards No. 115.

Page 11

NATIONAL COMMERCE FINANCIAL CORPORATION

Five Quarter Average Balance Sheets

(In Thousands)

	Three Months Ended
	6/30/2003		3/31/2003	12/31/2002	9/30/2002	6/30/2002
Assets
Cash and due from banks	$	422,653	398,564	419,601	418,062	436,473
Time deposits in other banks		5,742	9,575	8,491	5,475	22,411
Federal funds sold and other short-term investments		107,462	51,187	35,083	39,867	21,187
Investment securities (1)		6,674,537	5,706,704	5,382,247	5,310,350	5,197,443
Trading securities		120,999	87,496	70,464	75,782	89,229
Loans:
Commercial		3,492,900	3,350,959	3,246,050	3,164,303	3,062,154
Construction and commercial real estate		3,690,766	3,677,697	3,666,631	3,621,559	3,526,901
Mortgage (including loans held for sale)		1,159,296	1,601,618	1,734,853	1,670,716	1,663,703
Consumer		4,059,490	3,945,287	3,950,658	3,940,340	3,880,490
Revolving credit		78,142	76,939	73,195	70,419	68,573
Lease financing		133,952	136,528	132,434	132,738	133,716
Total loans		12,614,546	12,789,028	12,803,821	12,600,075	12,335,537
Allowance for loan losses		164,108	163,203	163,012	162,243	160,711
Net loans		12,450,438	12,625,825	12,640,809	12,437,832	12,174,826
Bank owned life insurance		231,397	228,214	224,742	221,185	217,458
Investment in First Market Bank		29,248	28,353	27,265	26,221	25,317
Premises and equipment		276,227	258,614	257,005	251,228	247,739
Goodwill		1,082,077	1,077,121	1,073,597	1,071,943	1,070,724
Core deposit intangibles		213,065	229,044	245,583	262,844	280,701
Other assets		559,550	591,745	596,126	518,885	449,796
Total assets	$	22,173,395	21,292,442	20,981,013	20,639,674	20,233,304
Liabilities
Deposits:
Demand deposits (noninterest-bearing)	$	2,375,641	2,140,299	2,120,154	1,989,040	1,923,408
Savings, NOW and money market accounts		5,765,351	5,684,696	5,601,106	5,591,451	5,800,664
Jumbo and brokered certificates of deposit		2,032,881	1,796,198	1,740,695	1,683,886	1,533,119
Time deposits		4,915,988	4,909,848	4,865,312	4,778,297	4,681,751
Total deposits		15,089,861	14,531,041	14,327,267	14,042,674	13,938,942
Short-term borrowings		1,388,604	1,249,458	1,134,553	1,192,955	1,124,318
FHLB advances		2,197,173	2,056,896	2,132,665	2,133,208	1,949,166
Trust preferred securities and long-term debt		299,247	296,745	285,003	281,684	282,053
Other liabilities		495,573	462,456	451,370	382,656	408,906
Total liabilities		19,470,458	18,596,596	18,330,858	18,033,177	17,703,385
Stockholders’ Equity
Common stock		409,257	410,541	410,722	412,517	412,736
Additional paid-in capital		1,735,104	1,749,408	1,752,110	1,773,722	1,780,106
Retained earnings		512,491	485,214	439,535	386,072	344,678
Accumulated other comprehensive income		46,085	50,683	47,788	34,186	(7,601	)
Total stockholders’ equity		2,702,937	2,695,846	2,650,155	2,606,497	2,529,919
Total liabilities and stockholders’ equity	$	22,173,395	21,292,442	20,981,013	20,639,674	20,233,304
Average assets	$	22,173,395	21,292,442	20,981,013	20,639,674	20,233,304
Intangible assets		1,295,142	1,306,165	1,319,180	1,334,787	1,351,425
Average tangible assets	$	20,878,253	19,986,277	19,661,833	19,304,887	18,881,879
Average stockholders’ equity	$	2,702,937	2,695,846	2,650,155	2,606,497	2,529,919
Intangible assets		1,295,142	1,306,165	1,319,180	1,334,787	1,351,425
Average tangible stockholders’ equity	$	1,407,795	1,389,681	1,330,975	1,271,710	1,178,494

(1) Average balances exclude the mark-to-market adjustment for Statement of Financial Accounting Standards No. 115.

Page 12

NATIONAL COMMERCE FINANCIAL CORPORATION

Year to Date Average Balance Sheets

(In Thousands)

	Six Months Ended
	6/30/2003		6/30/2002	$ Change		% Change
Assets
Cash and due from banks	$	410,675	454,467	(43,792	)	(9.6	)
Time deposits in other banks		7,648	25,256	(17,608	)	(69.7	)
Federal funds sold and other short-term investments		79,480	25,021	54,459		217.7
Investment securities (1)		6,193,294	5,014,627	1,178,667		23.5
Trading securities		104,340	82,513	21,827		26.5
Loans:
Commercial		3,422,322	3,025,204	397,118		13.1
Construction and commercial real estate		3,684,267	3,469,588	214,679		6.2
Mortgage (including loans held for sale)		1,379,235	1,726,981	(347,746	)	(20.1	)
Consumer		4,002,704	3,799,552	203,152		5.3
Revolving credit		77,544	67,040	10,504		15.7
Lease financing		135,233	134,457	776		—
Total loans		12,701,305	12,222,822	478,483		3.9
Allowance for loan losses		163,658	159,202	4,456		2.8
Net loans		12,537,647	12,063,620	474,027		3.9
Bank owned life insurance		229,814	215,737	14,077		6.5
Investment in First Market Bank		28,803	25,021	3,782		15.1
Premises and equipment		267,469	239,188	28,281		11.8
Goodwill		1,079,613	1,040,625	38,988		3.7
Core deposit intangibles		221,010	275,911	(54,901	)	(19.9	)
Other assets		575,559	430,499	145,060		33.7
Total assets	$	21,735,352	19,892,485	1,842,867		9.3
Liabilities
Deposits:
Demand deposits (noninterest-bearing)	$	2,258,620	1,835,344	423,276		23.1
Savings, NOW and money market accounts		5,725,246	5,643,359	81,887		1.5
Jumbo and brokered certificates of deposit		1,915,194	1,552,380	362,814		23.4
Time deposits		4,912,935	4,592,683	320,252		7.0
Total deposits		14,811,995	13,623,766	1,188,229		8.7
Short-term borrowings		1,319,415	1,048,208	271,207		25.9
FHLB advances		2,127,422	2,021,161	106,261		5.3
Trust preferred securities and long-term debt		298,003	282,052	15,951		5.7
Other liabilities		479,106	408,431	70,675		17.3
Total liabilities		19,035,941	17,383,618	1,652,323		9.5
Stockholders’ Equity
Common stock		409,896	412,117	(2,221	)	(.5	)
Additional paid-in capital		1,742,216	1,772,944	(30,728	)	(1.7	)
Retained earnings		498,928	321,416	177,512		55.2
Accumulated other comprehensive income		48,371	2,390	45,981		N/A
Total stockholders’ equity		2,699,411	2,508,867	190,544		7.6
Total liabilities and stockholders’ equity	$	21,735,352	19,892,485	1,842,867		9.3
Average assets	$	21,735,352	19,892,485	1,842,867		9.3
Intangible assets		1,300,623	1,316,536	(15,913	)	(1.2	)
Average tangible assets	$	20,434,729	18,575,949	1,858,780		10.0
Average stockholders’ equity	$	2,699,411	2,508,867	190,544		7.6
Intangible assets		1,300,623	1,316,536	(15,913	)	(1.2	)
Average tangible stockholders’ equity	$	1,398,788	1,192,331	206,457		17.3

(1) Average balances exclude the mark-to-market adjustment for Statement of Financial Accounting Standards No. 115.

Page 13

NATIONAL COMMERCE FINANCIAL CORPORATION

Current Quarter End of Period Balance Sheet

(In Thousands)

	As of			% Inc/(Decr)		As of		% Inc/(Decr)
	6/30/2003		3/31/2003			6/30/2003	6/30/2002
Assets
Cash and due from banks	$	536,123	522,814	2.5		536,123	481,326	11.4
Time deposits in other banks		5,265	4,328	21.6		5,265	6,544	(19.5	)
Federal funds sold and other short-term investments		160,383	42,899	273.9		160,383	105,932	51.4
Investment securities:
Available for sale		5,215,357	5,299,253	(1.6	)	5,215,357	4,632,713	12.6
Held to maturity		1,540,860	1,295,609	18.9		1,540,860	839,542	83.5
Trading securities		105,923	80,842	31.0		105,923	110,427	(4.1	)
Loans:
Commercial		3,570,337	3,403,217	4.9		3,570,337	3,114,754	14.6
Construction and commercial real estate		3,719,164	3,689,692	.8		3,719,164	3,582,421	3.8
Mortgage (including loans held for sale)		1,282,062	1,017,221	26.0		1,282,062	1,658,905	(22.7	)
Consumer		4,128,195	3,966,994	4.1		4,128,195	3,910,081	5.6
Revolving credit		79,437	76,616	3.7		79,437	69,388	14.5
Lease financing		130,698	135,126	(3.3	)	130,698	134,481	(2.8	)
Total loans		12,909,893	12,288,866	5.1		12,909,893	12,470,030	3.5
Allowance for loan losses		167,316	162,842	2.7		167,316	161,616	3.5
Net loans		12,742,577	12,126,024	5.1		12,742,577	12,308,414	3.5
Bank owned life insurance		233,452	230,228	1.4		233,452	219,542	6.3
Investment in First Market Bank		29,995	28,923	3.7		29,995	25,839	16.1
Premises and equipment		275,612	274,433	.4		275,612	248,567	10.9
Goodwill		1,083,157	1,077,332	.5		1,083,157	1,071,769	1.1
Core deposit intangibles		204,959	220,632	(7.1	)	204,959	271,318	(24.5	)
Other assets		546,328	518,668	5.3		546,328	490,235	11.4
Total assets	$	22,679,991	21,721,985	4.4		22,679,991	20,812,168	9.0
Liabilities
Deposits:
Demand deposits (noninterest-bearing)	$	2,657,291	2,383,806	11.5		2,657,291	2,051,963	29.5
Savings, NOW and money market accounts		5,849,113	5,795,400	.9		5,849,113	5,732,415	2.0
Jumbo and brokered certificates of deposit		2,063,785	1,804,492	14.4		2,063,785	1,652,279	24.9
Time deposits		4,876,012	4,942,165	(1.3	)	4,876,012	4,703,158	3.7
Total deposits		15,446,201	14,925,863	3.5		15,446,201	14,139,815	9.2
Short-term borrowings		1,465,425	1,351,105	8.5		1,465,425	1,352,416	8.4
FHLB advances		2,274,384	1,951,912	16.5		2,274,384	2,026,082	12.3
Trust preferred securities and long-term debt		295,049	300,127	(1.7	)	295,049	282,108	4.6
Other liabilities		478,497	496,964	(3.7	)	478,497	415,361	15.2
Total liabilities		19,959,556	19,025,971	4.9		19,959,556	18,215,782	9.6
Stockholders' Equity
Common stock		408,770	410,019	(.3	)	408,770	412,835	(1.0	)
Additional paid-in capital		1,730,367	1,743,146	(.7	)	1,730,367	1,779,603	(2.8	)
Retained earnings		533,462	496,783	7.4		533,462	369,912	44.2
Accumulated other comprehensive income		47,836	46,066	3.8		47,836	34,036	40.5
Total stockholders' equity		2,720,435	2,696,014	.9		2,720,435	2,596,386	4.8
Total liabilities and stockholders' equity	$	22,679,991	21,721,985	4.4		22,679,991	20,812,168	9.0

Page 14

NATIONAL COMMERCE FINANCIAL CORPORATION

Five Quarter End of Period Balance Sheets

(In Thousands Except Share and Per Share Data)

	As of
	6/30/2003		3/31/2003	12/31/2002	9/30/2002	6/30/2002
Assets
Cash and due from banks	$	536,123	522,814	517,295	484,879	481,326
Time deposits in other banks		5,265	4,328	12,276	2,984	6,544
Federal funds sold and
other short-term investments		160,383	42,899	73,186	10,722	105,932
Investment securities:
Available for sale		5,215,357	5,299,253	4,777,009	4,512,627	4,632,713
Held to maturity		1,540,860	1,295,609	925,652	934,506	839,542
Trading securities		105,923	80,842	116,954	102,892	110,427
Loans:
Commercial		3,570,337	3,403,217	3,329,451	3,219,205	3,114,754
Construction and commercial real estate		3,719,164	3,689,692	3,655,671	3,668,588	3,582,421
Mortgage (including loans held for sale) (1)		1,282,062	1,017,221	1,798,326	1,685,122	1,658,905
Consumer		4,128,195	3,966,994	3,933,482	3,962,914	3,910,081
Revolving credit		79,437	76,616	74,463	71,805	69,388
Lease financing		130,698	135,126	132,547	132,929	134,481
Total loans		12,909,893	12,288,866	12,923,940	12,740,563	12,470,030
Allowance for loan losses		167,316	162,842	163,424	163,336	161,616
Net loans		12,742,577	12,126,024	12,760,516	12,577,227	12,308,414
Bank owned life insurance		233,452	230,228	227,051	223,425	219,542
Investment in First Market Bank		29,995	28,923	27,997	26,913	25,839
Premises and equipment		275,612	274,433	257,676	253,739	248,567
Goodwill		1,083,157	1,077,332	1,077,118	1,072,371	1,071,769
Core deposit intangibles		204,959	220,632	236,916	253,812	271,318
Other assets		546,328	518,668	462,470	487,634	490,235
Total assets	$	22,679,991	21,721,985	21,472,116	20,943,731	20,812,168
Liabilities
Deposits:
Demand deposits (noninterest-bearing)	$	2,657,291	2,383,806	2,241,833	2,185,954	2,051,963
Savings, NOW and money market accounts		5,849,113	5,795,400	5,666,407	5,558,221	5,732,415
Jumbo and brokered certificates of deposit		2,063,785	1,804,492	1,723,548	1,856,527	1,652,279
Time deposits		4,876,012	4,942,165	4,862,946	4,822,424	4,703,158
Total deposits		15,446,201	14,925,863	14,494,734	14,423,126	14,139,815
Short-term borrowings		1,465,425	1,351,105	1,452,764	1,012,128	1,352,416
FHLB advances		2,274,384	1,951,912	2,106,474	2,218,750	2,026,082
Trust preferred securities and long-term debt		295,049	300,127	296,707	279,112	282,108
Other liabilities		478,497	496,964	439,005	371,102	415,361
Total liabilities		19,959,556	19,025,971	18,789,684	18,304,218	18,215,782
Stockholders’ Equity
Common stock		408,770	410,019	410,816	411,536	412,835
Additional paid-in-capital		1,730,367	1,743,146	1,753,241	1,762,453	1,779,603
Retained earnings		533,462	496,783	467,641	417,769	369,912
Accumulated other comprehensive income		47,836	46,066	50,734	47,755	34,036
Total stockholders’ equity		2,720,435	2,696,014	2,682,432	2,639,513	2,596,386
Total liabilities and stockholders’ equity	$	22,679,991	21,721,985	21,472,116	20,943,731	20,812,168
Total assets	$	22,679,991	21,721,985	21,472,116	20,943,731	20,812,168
Intangible assets		1,288,116	1,297,964	1,314,034	1,326,183	1,343,087
Total tangible assets	$	21,391,875	20,424,021	20,158,082	19,617,548	19,469,081
Total stockholders’ equity	$	2,720,435	2,696,014	2,682,432	2,639,513	2,596,386
Intangible assets		1,288,116	1,297,964	1,314,034	1,326,183	1,343,087
Total tangible stockholders’ equity	$	1,432,319	1,398,050	1,368,398	1,313,330	1,253,299

(1) In late March 2003, the Company consummated a transaction securitizing mortgage loans and retained a majority of the resulting securities. The March 31, 2003 period end balances were reduced by approximately $646 million.

Page 15

NATIONAL COMMERCE FINANCIAL CORPORATION

Rollforward of Stockholders’ Equity

Six Months ended June 30, 2003 and 2002

(In Thousands Except for Share Data)

	Shares of Common Stock		Common Stock			Additional Paid-In Capital		Retained Earnings		Other Comp. Income		Total Stockholders’ Equity
Balance January 1, 2002	205,058,713		$	410,117		1,756,128		276,342		12,744		2,455,331
Net income	—			—		—		155,767		—		155,767
Restricted stock transactions, net	7,065			14		1,172		—		—		1,186
Options exercised, net of shares tendered	1,491,863			2,985		26,064		—		—		29,049
Shares repurchased and retired	(100,000	)		(200	)	(2,337	)	—		—		(2,537	)
Cash dividends ($.30 per share)	—			—		—		(62,197	)	—		(62,197	)
Change in minimum pension liability, net of applicable income taxes	—			—		—		—		98		98
Change in unrealized losses on investment securities available for sale, net of applicable income taxes	—			—		—		—		21,194		21,194
Other transactions, net	(40,377	)		(81	)	(1,424	)	—		—		(1,505	)
Total equity, June 30, 2002	206,417,264		$	412,835		1,779,603		369,912		34,036		2,596,386
Total equity, January 1, 2003	205,408,183		$	410,816		1,753,241		467,641		50,734		2,682,432
Net income	—			—		—		135,597		—		135,597
Restricted stock transactions, net	1,693			3		1,258		—		—		1,261
Options exercised, net of shares tendered	472,596			947		5,607		—		—		6,554
Shares repurchased and retired	(1,474,300	)		(2,949	)	(29,272	)	—		—		(32,221	)
Cash dividends ($.34 per share)	—			—		—		(69,776	)	—		(69,776	)
Change in minimum pension liability, net of applicable income taxes	—			—		—		—		(742	)	(742	)
Change in unrealized gains on investment securities available for sale, net of applicable income taxes	—			—		—		—		(1,955	)	(1,955	)
Change in unrealized loss on hedging instruments, net of applicable income taxes	—			—		—		—		(201	)	(201	)
Other transactions, net	(23,394	)		(47	)	(467	)	—		—		(514	)
Balance, June 30, 2003	204,384,778		$	408,770		1,730,367		533,462		47,836		2,720,435

Page 16

NATIONAL COMMERCE FINANCIAL CORPORATION

Current Quarter Asset Quality

(In Thousands)

	As Of And For The Three Months Ended					% Inc/(Decr)		As Of And For The Three Months Ended				% Inc/(Decr)
	6/30/03			3/31/03				6/30/03		6/30/02
Allowance For Loan Losses
Beginning balance	$	162,842		163,424		(.4	)	162,842		160,194		1.7
Charge-offs:
Commercial		(893	)	(1,441	)	(38.0	)	(893	)	(2,637	)	(66.1	)
Construction and commercial real estate		(84	)	(141	)	(40.4	)	(84	)	(37	)	127.0
Secured by real estate		(1,375	)	(727	)	89.1		(1,375	)	(985	)	39.6
Consumer		(6,289	)	(5,977	)	5.2		(6,289	)	(4,140	)	51.9
Revolving credit		(1,133	)	(941	)	20.4		(1,133	)	(926	)	22.4
Lease financing		(605	)	(53	)	1041.5		(605	)	(173	)	249.7
Total charge-offs		(10,379	)	(9,280	)	11.8		(10,379	)	(8,898	)	16.6
Recoveries:
Commercial		261		273		(4.4	)	261		150		74.0
Construction and commercial real estate		1		7		(85.7	)	1		2		(50.0	)
Secured by real estate		69		26		165.4		69		88		(21.6	)
Consumer		824		931		(11.5	)	824		1,096		(24.8	)
Revolving credit		290		322		(9.9	)	290		287		1.0
Lease financing		32		37		(13.5	)	32		(16	)	(300.0	)
Total recoveries		1,477		1,596		(7.5	)	1,477		1,607		(8.1	)
Net charge-offs		(8,902	)	(7,684	)	15.9		(8,902	)	(7,291	)	22.1
Provision for loan losses		13,376		7,684		74.1		13,376		8,713		53.5
Changes from acquisitions (sales)		—		(582	)	(100.0	)	—		—		—
Ending balance	$	167,316		162,842		2.7		167,316		161,616		3.5
Nonperforming Assets
Nonaccrual loans by loan type:
Commercial	$	20,151		19,833		1.6		20,151		17,676		14.0
Construction and commercial real estate		7,014		6,883		1.9		7,014		9,988		(29.8	)
Secured by real estate		1,901		2,105		(9.7	)	1,901		238		698.7
Consumer		3,227		2,004		61.0		3,227		1,588		103.2
Lease financing		1,550		2,013		(23.0	)	1,550		975		59.0
Total nonperforming loans		33,843		32,838		3.1		33,843		30,465		11.1
Foreclosed real estate		23,961		22,981		4.3		23,961		24,634		(2.7	)
Nonperforming loans and foreclosed real estate		57,804		55,819		3.6		57,804		55,099		4.9
Other repossessed assets		8,420		11,962		(29.6	)	8,420		10,602		(20.6	)
Nonperforming assets	$	66,224		67,781		(2.3	)	66,224		65,701		.8
Ninety days past due and accruing	$	51,761		56,104		(7.7	)	51,761		52,351		(1.1	)
Asset Quality Ratios
Net charge-offs (annualized) by loan type:
Commercial		.07	%	.14				.07		.33
Construction and commercial real estate		.01		.01				.01		.00
Secured by real estate		.45		.18				.45		.22
Consumer		.54		.52				.54		.31
Revolving credit		4.33		3.26				4.33		3.74
Lease financing		1.72		.05				1.72		.57
Net loans charged-off (annualized) to average loans		.28		.24				.28		.24
Nonperforming loans to total loans		.26		.27				.26		.24
Nonperforming loans and foreclosed real estate to loans and foreclosed real estate		.45		.45				.45		.44
Nonperforming assets to loans plus foreclosed real estate and other repossessed assets		.51		.55				.51		.53
Loan loss allowance to total loans		1.30		1.33				1.30		1.30
Loan loss allowance to loans (excluding loans held for sale)		1.35		1.37				1.35		1.31
Loan loss allowance to net charge-offs (annualized)		4.69	x	5.23				4.69		5.53
Loan loss allowance to nonperforming loans		4.94		4.96				4.94		5.30

Page 17

NATIONAL COMMERCE FINANCIAL CORPORATION

Five Quarter Asset Quality

(In Thousands)

	As Of And For The Three Months Ended
	6/30/2003			3/31/2003		12/31/2002		9/30/2002		6/30/2002
Allowance For Loan Losses
Beginning balance	$	162,842		163,424		163,336		161,616		160,194
Charge-offs:
Commercial		(893	)	(1,441	)	(1,287	)	(2,449	)	(2,637	)
Construction and commercial real estate		(84	)	(141	)	(123	)	(126	)	(37	)
Secured by real estate		(1,375	)	(727	)	(951	)	(666	)	(985	)
Consumer		(6,289	)	(5,977	)	(4,053	)	(6,231	)	(4,140	)
Revolving credit		(1,133	)	(941	)	(1,255	)	(955	)	(926	)
Lease financing		(605	)	(53	)	(708	)	(249	)	(173	)
Total charge-offs		(10,379	)	(9,280	)	(8,377	)	(10,676	)	(8,898	)
Recoveries:
Commercial		261		273		125		141		150
Construction and commercial real estate		1		7		—		6		2
Secured by real estate		69		26		49		119		88
Consumer		824		931		813		961		1,096
Revolving credit		290		322		231		179		287
Lease financing		32		37		38		—		(16	)
Total recoveries		1,477		1,596		1,256		1,406		1,607
Net charge-offs		(8,902	)	(7,684	)	(7,121	)	(9,270	)	(7,291	)
Provision for loan losses		13,376		7,684		7,127		10,990		8,713
Changes from acquisitions (sales)		—		(582	)	82		—		—
Ending balance	$	167,316		162,842		163,424		163,336		161,616
Nonperforming Assets
Nonaccrual loans by loan type:
Commercial	$	20,151		19,833		16,992		19,761		17,676
Construction and commercial real estate		7,014		6,883		8,531		6,976		9,988
Secured by real estate		1,901		2,105		2,261		278		238
Consumer		3,227		2,004		2,089		1,461		1,588
Lease financing		1,550		2,013		933		1,178		975
Total nonperforming loans		33,843		32,838		30,806		29,654		30,465
Foreclosed real estate		23,961		22,981		25,480		24,612		24,634
Nonperforming loans and foreclosed real estate		57,804		55,819		56,286		54,266		55,099
Other repossessed assets		8,420		11,962		9,285		9,688		10,602
Nonperforming assets	$	66,224		67,781		65,571		63,954		65,701
Ninety days past due and accruing		51,761		56,104		56,384		49,803		52,351
Asset Quality Ratios
Net charge-offs (annualized) by loan type:
Commercial		.07	%	.14		.14		.29		.33
Construction and commercial real estate		.01		.01		.01		.01		.00
Secured by real estate		.45		.18		.21		.13		.22
Consumer		.54		.52		.33		.53		.31
Revolving credit		4.33		3.26		5.55		4.37		3.74
Lease financing		1.72		.05		2.01		.74		.57
Net loans charged-off (annualized) to average loans		.28		.24		.22		.29		.24
Nonperforming loans to total loans		.26		.27		.24		.23		.24
Nonperforming loans and foreclosed real estate to loans and foreclosed real estate		.45		.45		.43		.43		.44
Nonperforming assets to loans plus foreclosed real estate and other repossessed assets		.51		.55		.51		.50		.53
Loan loss allowance to total loans		1.30		1.33		1.26		1.28		1.30
Loan loss allowance to loans (excluding loans held for sale)		1.35		1.37		1.31		1.30		1.31
Loan loss allowance to net charge-offs (annualized)		4.69	x	5.23		5.78		4.44		5.53
Loan loss allowance to nonperforming loans		4.94		4.96		5.30		5.51		5.30

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NATIONAL COMMERCE FINANCIAL CORPORATION

Year to Date Asset Quality

(In Thousands)

	As Of And For The Six Months Ended					$ Change		% Inc/(Decr)
	6/30/03			6/30/02
Allowance For Loan Losses
Beginning balance	$	163,424		156,401		7,023		4.5
Charge-offs:
Commercial		(2,334	)	(3,719	)	1,385		(37.2	)
Construction and commercial real estate		(225	)	(135	)	(90	)	66.7
Secured by real estate		(2,102	)	(1,868	)	(234	)	12.5
Consumer		(12,266	)	(10,532	)	(1,734	)	16.5
Revolving credit		(2,074	)	(1,870	)	(204	)	10.9
Lease financing		(658	)	(341	)	(317	)	93.0
Total charge-offs		(19,659	)	(18,465	)	(1,194	)	6.5
Recoveries:
Commercial		534		525		9		1.7
Construction and commercial real estate		8		2		6		300.0
Secured by real estate		95		92		3		3.3
Consumer		1,755		2,212		(457	)	(20.7	)
Revolving credit		612		509		103		20.2
Lease financing		69		6		63		1050.0
Total recoveries		3,073		3,346		(273	)	(8.2	)
Net charge-offs		(16,586	)	(15,119	)	(1,467	)	9.7
Provision for loan losses		21,060		14,227		6,833		48.0
Changes from acquisitions (sales)		(582	)	6,107		(6,689	)	(109.5	)
Ending balance	$	167,316		161,616		5,700		3.5
Asset Quality Ratios
Net charge-offs by loan type:
Commercial		.11	%	.21
Construction and commercial real estate		.01		.01
Secured by real estate		.29		.21
Consumer		.53		.44
Revolving credit		3.80		4.09
Lease financing		.88		.50
Net loans charged-off to average loans		.26		.25
Loan loss allowance to total loans		1.30		1.30
Loan loss allowance to net charge-offs		5.00	x	5.30

Page 19

NATIONAL COMMERCE FINANCIAL CORPORATION

Five Quarter Average Balance Sheets and Net Interest Income Analysis

(In Thousands Except Share and Per Share Data)

	Three Months Ended
	6/30/2003						3/31/2003			12/31/2002			9/30/2002			6/30/2002
	Average Balance		Interest		Average Yield/Rate		Average Balance	Interest	Average Yield/Rate	Average Balance	Interest	Average Yield/Rate	Average Balance	Interest	Average Yield/Rate	Average Balance	Interest	Average Yield/Rate
Earning assets:
Total loans	$	12,614,546		190,239	6.05	%	12,789,028	199,861	6.32	12,803,821	214,799	6.67	12,600,075	217,482	6.86	12,335,537	218,856	7.11
Investment securities (1)		6,674,537		80,778	4.84		5,706,704	69,677	4.88	5,382,247	71,006	5.28	5,310,350	72,611	5.47	5,197,443	72,555	5.58
Trading securities		120,999		437	1.44		87,496	586	2.68	70,464	595	3.38	75,782	672	3.55	89,229	613	2.75
Time deposits in other banks		5,742		17	1.21		9,575	25	1.06	8,491	37	1.72	5,475	26	1.87	22,411	142	2.54
Federal funds sold and other short-term investments		107,462		340	1.27		51,187	167	1.33	35,083	162	1.85	39,867	191	1.90	21,187	128	2.43
Total earning assets		19,523,286		271,811	5.58		18,643,990	270,316	5.85	18,300,106	286,599	6.23	18,031,549	290,982	6.42	17,665,807	292,294	6.63
Non-earning assets:
Cash and due from banks		422,653					398,564			419,601			418,062			436,473
Bank owned life insurance		231,397					228,214			224,742			221,185			217,458
Investment in First Market Bank		29,248					28,353			27,265			26,221			25,317
Premises and equipment		276,227					258,614			257,005			251,228			247,739
Goodwill		1,082,077					1,077,121			1,073,597			1,071,943			1,070,724
Core deposit intangibles		213,065					229,044			245,583			262,844			280,701
Other assets, net		395,442					428,542			433,114			356,642			289,085
Total assets	$	22,173,395					21,292,442			20,981,013			20,639,674			20,233,304
Interest-bearing liabilities
Interest-bearing deposits:
Savings, NOW and money market accounts	$	5,765,351		11,006	.76	%	5,684,696	11,957	.85	5,601,106	14,036	.99	5,591,451	15,605	1.11	5,800,664	18,527	1.28
Jumbo and brokered certificates of deposit		2,032,881		7,378	1.46		1,796,198	7,189	1.62	1,740,695	8,281	1.89	1,683,886	8,611	2.03	1,533,119	8,290	2.17
Time deposits		4,915,988		36,800	3.00		4,909,848	38,142	3.15	4,865,312	40,878	3.33	4,778,297	41,651	3.46	4,681,751	45,046	3.86
Total interest-bearing deposits		12,714,220		55,184	1.74		12,390,742	57,288	1.88	12,207,113	63,195	2.05	12,053,634	65,867	2.17	12,015,534	71,863	2.40
Short-term borrowings		1,388,604		4,698	1.37		1,249,458	4,368	1.40	1,134,553	4,463	1.56	1,192,955	5,393	1.79	1,124,318	4,461	1.59
FHLB advances		2,197,173		21,397	3.91		2,056,896	22,118	4.36	2,132,665	23,667	4.40	2,133,208	24,010	4.47	1,949,166	22,626	4.66
Trust preferred securities and long-term debt		299,247		2,133	2.81		296,745	2,160	2.95	285,003	2,458	3.45	281,684	2,410	3.42	282,053	2,474	3.51
Total interest-bearing liabilities		16,599,244		83,412	2.02		15,993,841	85,934	2.18	15,759,334	93,783	2.36	15,661,481	97,680	2.47	15,371,071	101,424	2.65
Other liabilities and stockholders’ equity:
Demand deposits (noninterest-bearing)		2,375,641					2,140,299			2,120,154			1,989,040			1,923,408
Other liabilities		495,573					462,456			451,370			382,656			408,906
Stockholders’ equity		2,702,937					2,695,846			2,650,155			2,606,497			2,529,919
Total liabilities and stockholders’ equity	$	22,173,395					21,292,442			20,981,013			20,639,674			20,233,304
Net interest income and margin			$	188,399	3.86	%		184,382	3.98		192,816	4.20		193,302	4.27		190,870	4.33
Interest rate spread					3.56	%			3.67			3.87			3.95			3.98

(1) Average balances exclude the mark-to-market adjustment for Statement of Financial Accounting Standards No. 115.

Page 20

NATIONAL COMMERCE FINANCIAL CORPORATION

Year to Date Average Balance Sheets and Net Interest Income Analysis

(In Thousands Except Share and Per Share Data)

	Six Months Ended
	6/30/2003						6/30/2002
	Average Balance		Interest		Average Yield/Rate		Average Balance	Interest	Average Yield/Rate
Earning assets:
Total loans	$	12,701,305		390,100	6.19	%	12,222,822	439,677	7.24
Investment securities (1)		6,193,294		150,455	4.86		5,014,627	141,056	5.63
Trading securities		104,340		1,023	1.96		82,513	1,055	2.56
Time deposits in other banks		7,648		42	1.11		25,256	310	2.47
Federal funds sold and other short-term investments		79,480		507	1.29		25,021	277	2.23
Total earning assets		19,086,067		542,127	5.71		17,370,239	582,375	6.74
Non-earning assets:
Cash and due from banks		410,675					454,467
Bank owned life insurance		229,814					215,737
Investment in First Market Bank		28,803					25,021
Premises and equipment		267,469					239,188
Goodwill		1,079,613					1,040,625
Core deposit intangibles		221,010					275,911
Other assets, net		411,901					271,297
Total assets	$	21,735,352					19,892,485
Interest-bearing liabilities
Interest-bearing deposits:
Savings, NOW and money market accounts	$	5,725,246		22,963	.81	%	5,643,359	35,929	1.28
Jumbo and brokered certificates of deposit		1,915,194		14,567	1.53		1,552,380	17,108	2.22
Time deposits		4,912,935		74,942	3.08		4,592,683	93,660	4.11
Total interest-bearing deposits		12,553,375		112,472	1.81		11,788,422	146,697	2.51
Short-term borrowings		1,319,415		9,066	1.38		1,048,208	7,961	1.53
FHLB advances		2,127,422		43,515	4.12		2,021,161	45,815	4.57
Trust preferred securities and long-term debt		298,003		4,293	2.88		282,052	4,955	3.52
Total interest-bearing liabilities		16,298,215		169,346	2.09		15,139,843	205,428	2.74
Other liabilities and stockholders’ equity:
Demand deposits (noninterest-bearing)		2,258,620					1,835,344
Other liabilities		479,106					408,431
Stockholders’ equity		2,699,411					2,508,867
Total liabilities and stockholders’ equity	$	21,735,352					19,892,485
Net interest income and margin			$	372,781	3.92	%		376,947	4.36
Interest rate spread					3.62	%			4.00

(1) Average balances exclude the mark-to-market adjustment for Statement of Financial Accounting Standards No. 115.

Page 21