EX-99.2 3 dex992.htm PRESENTATION Presentation
SunTrust Banks, Inc.
3Q 2007 Earnings Presentation
October 18, 2007
Exhibit 99.2

1
The following should be read in conjunction with the financial statements, notes and other information contained in the Company’s 2006 Annual Report on Form 10-K, Quarterly
Reports on Form 10-Q, and Current Reports on Form 8-K.
This presentation may include non-GAAP financial measures to describe SunTrust’s performance.  The reconciliation of those measures to GAAP measures can be found in
SunTrust’s earnings press releases, which can be found on SunTrust’s website in the news section of the investor relations pages.  In this presentation, net interest income and net
interest margin are presented on a fully taxable-equivalent (“FTE”) basis, and ratios are presented on an annualized basis. The FTE basis adjusts for the tax-favored status of income
from certain loans and investments. The Company believes this measure to be the preferred industry measurement of net interest income and provides relevant comparison between
taxable and non-taxable amounts.
The
information
in
this
presentation
may
contain
forward-looking
statements.
Statements
that
do
not
describe
historical
or
current
facts,
including
statements
about
beliefs
and
expectations,
and
in
particular
the
outlook
statements
provided
at
slide
14,
are
forward-looking
statements.
These
statements
often
include
the
words
“may,”
“could,”
“will,”
“should,”
“believes,”
“expects,”
“anticipates,”
“estimates,”
“intends,”
“plans,”
“targets,”
“initiatives,”
“potentially,”
“probably,”
“projects,”
“outlook”
or
similar
expressions.
Such
statements
are
based
upon
the
current
beliefs
and
expectations
of
SunTrust's
management
and
on
information
currently
available
to
management.
The
forward
looking
statements
are
intended
to
be
subject to
the
safe
harbor
provided
by
Section
27A
of
the
Securities
Act
of
1933
and
Section
21E
of
the
Securities
Exchange
Act
of
1934.
Such
statements
speak
as
of
the
date
hereof,
and
SunTrust
does
not
intend
to
update
the
statements
made
herein
or
to
update
the
reasons
why
actual
results
could
differ
from
those
contained
in
such
statements
in
light
of
new
information or future events.
Forward looking statements are subject significant risks and uncertainties.  Investors are cautioned against placing undue reliance on such statements. Actual results may differ
materially from those set forth in the forward-looking statements. Factors that could cause SunTrust’s results to differ materially from those described in the forward-looking statements
can be found in the Company's 2006 Annual Report on Form 10-K, in the Company’s Quarterly Reports on Form 10-Q, and in the Current Reports on Form 8-K filed with the Securities
and Exchange Commission and available at the Securities and Exchange Commission's internet site (http://www.sec.gov). Those factors include: changes in general business or
economic
conditions
could
have
a
material
adverse
effect
on
our
financial
condition
and
results
of
operations;
our
trading
assets
and
financial
instruments
carried
at
fair
value
expose
the
Company
to
certain
market
risks;
changes
in
market
interest
rates
or
capital
markets
could
adversely
affect
our
revenues
and
expenses,
the
value
of
assets
and
obligations,
costs
of
capital,
or
liquidity;
the
fiscal
and
monetary
policies
of
the
federal
government
and
its
agencies
could
have
a
material
adverse
effect
on
our
earnings;
significant
changes
in
securities
markets
or
markets
for
commercial
or
residential
real
estate
could
harm
our
revenues
and
profitability;
customers
could
pursue
alternatives
to
bank
deposits,
causing
us
to
lose
a
relatively
inexpensive
source
of
funding;
customers
may
decide
not
to
use
banks
to
complete
their
financial
transactions,which
could
affect
net
income;
we
have
businesses
other
than
banking,
which
subjects
us
to
a
variety
of
risks;
hurricanes
and
other
natural
disasters
may
adversely
affect
loan
portfolios
and
operations
and
increase
the
cost
of
doing
business;
negative
public
opinion
could
damage
our
reputation
and
adversely
impact
our
business;we
rely
on
other
companies
for
key
components
of
our
business
infrastructure;we
rely
on
our
systems,
employees
and
certain
counterparties,
and
certain
failures
could
materially
adversely
affect
our
operations;we
depend
on
the
accuracy
and
completeness
of
information
about
clients
and
counterparties;
regulation
by
federal
and
state
agencies
could
adversely
affect
our
business,
revenues,
and
profit
margins;
competition
in
the
financial
services
industry
is
intense
and
could
result
in
losing
business
or
reducing
profit
margins;
future
legislation
could
harm
our
competitive
position;
maintaining
or
increasing
market
share
depends
on
market
acceptance
and
regulatory
approval
of
new
products
and
services;
our
ability
to
receive
dividends
from
our
subsidiaries
accounts
for
most
of
our
revenues
and
could
affect
our
liquidity
and
ability
to
pay
dividends;
significant
legal
actions
could
subject
us
to
substantial
uninsured
liabilities;
we
have
in
the
past
and
may
in
the
future
pursue
acquisitions,
which
could
affect
costs
and
from
which
we
may
not
be
able
to
realize
anticipated
benefits;we
depend
on
the
expertise
of
key
personnel
withoutwhom
our
operations
may
suffer;we
may
be
unable
to
hire
or
retain
additional
qualified
personnel
and
recruiting
and
compensation
costs
may
increase
as
a
result
of
turnover,
both
of
which
may
increase
costs
and
reduce
profitability
and
may
adversely
impact
our
ability
to
implement
our
business
strategy;
our
accounting
policies
and
methods
are
key
to
howwe
report
financial
condition
and
results
of
operations,
and
may
require
management to make estimates about matters that are uncertain; changes in our accounting policies or in accounting standards could materially affect how we report our financial results
and condition; our stock price can be volatile; our disclosure controls and procedures may fail to prevent or detect all errors or acts of fraud; weakness in residential property values and
mortgage loan markets could adversely affect us; and we may be required to repurchase mortgage loans or indemnify mortgage loan purchasers as a result of breaches of
representations and warranties, borrower fraud, or certain borrower defaults, which could harm our liquidity, results of operations and financial condition.

2
3Q 2007 Financial Performance
Income Statement Summary
($ in millions, except per share data)
Net Interest Income (FTE)
Provision for Loan Losses
Noninterest Income
Noninterest Income Excluding Net Securities Gains
& Losses and Net Gain on Sale of Bond Trustee
Total Revenue (FTE)
Total Revenue (FTE) Excluding Net Securities
Gains & Losses and Net Gain on Sale of Bond
Trustee
Total Noninterest Expense
Total Noninterest Excluding Severance
Provision
for
Income
Taxes¹
Net Income Available to Common Shareholders
Net Income Available to Common Shareholders
Excluding Coke Gain
Diluted
Net
Income
Per
Average
Common
Share²
Diluted Net Income Per Average Common Share
Excluding Coke Gain²
3Q 2007
Sept 30, 2007
3Q 2006
% Change
Annualized
2Q 2007
1.
Effective tax rate in 3Q 2007 was 26.7% versus
31.5% in 2Q 2007 due to: taxes paid on The Coca-Cola Company (“Coke”) gain in 2Q;  the true up of expense
associated with the early  termination of a capital security; and lower projected taxable income
2.
Accelerated share repurchase totaling 9.5 million shares completed in 3Q 2007 with 8 million shares fully reflected and 1.5 million partially
Sept 30, 2006
% Change
Nine Months Ended
$1,219.2
0%
4%
$3,627.5
2%
147.0
NM
NM
308.1
NM
819.1
NM
(5)%
2,852.7
10%
818.1
(44)%
(2)%
2,615.2
2%
2,038.4
(57)%
0%
6,480.1
5%
2,037.4
(19)%                          1%
6,242.7
2%
1,291.2
13%
7%
3,778.4
4%
1,246.2   
(2)%
3%
3,733.4
2%
152.9
NM
(26)%
695.2
2%
412.6
NM
(23)%                      1,600.5
(1)%
412.6
(88)%                    (23)%                     1,455.0
(10)%
1.18
NM                      (20)%
4.52
2%
1.18
(81)%
(20)%                            4.11
(7)%

3
1.
Does
not
include
initial
costs
or
non-recurring
expense
reductions
associated
with
E²
implementation,
including
severance
2.
Total realized expense reductions achieved year-to-date through the end of 3Q
($ in millions)
E
2
Efficiency and Productivity Program: Estimated Gross Cost Savings
1
Savings For Fiscal Year 2009 Represent Over 10% of Expense Base
Cumulative Total
2007
2008
2009
Corporate Real Estate
Supplier Management
Offshoring/Outsourcing
Process Reengineering
Organizational Review
100
115
45
125
145
$
$181
$350
$530
TOTAL    
$   530
E
2
2007 Estimated Gross Cost Savings
1,2
($ in millions)
Gross Cost Savings
For 3Q  
= $59.5M
$140.1
$0.0
$135.0
$90.0
$45.0
$181.0

4
Driving Shareholder Value
Capital
Management
•
3Q 2007 results include a pre-tax one-time charge of $45 million associated with the eliminations
•
Over 1,000 individuals notified in late August of position elimination
E
2
Program
Approximately 2,400 primarily non-customer contact employee positions, or 7% of the
workforce, will be eliminated by year-end 2008
Sale and leaseback transactions are progressing
Investing
For
Growth
Mobile Banking and small business Online Payroll applications will be launched in November
Added 178 net new Retail Mortgage Loan Officers; net overall sales team increased by over 300
During 2007, we will open 47 new branches, and improve over 50% of our branches; over 40% will
be refreshed and over 10% will be renovated
Investments in GenSpring family offices include its recent rebranding (formerly AMA), opening a
New York office, hiring several client advisors, and a small acquisition
10.2 million shares repurchased year-to-date
Tier 1 capital target remains at 7.5%; 7.45% at 9/30/07¹
Evaluation of Coke holdings continues with expected communication before year end
•
Completed transactions and initiatives provide 25% of our $100 million run rate objective for 2009
•
We expect to have the remaining for sale properties under contract by year end
•
Closings on the remaining sales are expected to occur during 4Q 2007 and 1Q 2008
1.  Tier 1 capital ratio is estimated as of 9/30/2007

5
Financial Topics:  Margin and Provision
Margin Continues to Improve, Growing to 3.18% in 3Q 2007
Provision Increase of $42.3 Million Over 2Q 2007
Continued improvement from balance
sheet strategies
Trend should continue in 4Q 2007
2008 NIM should benefit from lower
short term rates and yield curve
steepening
Provision
Net Charge-Offs
Net ALLL Increase
Allowance to Loan
Ratio
Charge-Off Ratio
2Q 2007
3Q 2007
$104.7
88.3
$16.4
0.88%
0.30%
$147.0
103.7
$43.3
0.91%
0.34%
3Q 2007 charge-offs largely from
consumer portfolios
YTD charge-off ratio = 0.28%
Through mid-year 2008, we anticipate 
charge-offs will be in the 35-45 bps
range assuming no further material
deterioration in the economy
Allowance ratio adequate to cover
current estimated losses
2.94%
3.02%
3.10%
3.18%
4Q 2006
1Q 2007
2Q 2007
3Q 2007
($ in millions)

6
Financial Topics:  Market Impacts and Expense Growth
$161 million Pre-Tax Impact of Market Conditions on Non-Interest Income
Capital Markets
Mortgage
Treasury
$    (121)
(88)
48
TOTAL    
$   161
Core Expense Growth of 1.5% YTD 2007 over YTD 2006
($ in millions)
Charges equate to $0.28 per share
Further declines in fixed income values
in September added to our previous
$0.20 impact through August
The losses are largely unrealized, but we
do not expect a material recovery in the
short run
Noninterest Expense
Net E²
Non-Recurring¹
Elimination of FAS 91 Deferral²
Reversal of LILO QTE Reserve
True Up of Expense for Early
Termination of Capital Security
Debt Retirement Cost
Adjusted Noninterest
Expense
YTD 2007
YTD 2006
% Change
$3,778.4
(57.6)
(44.5)
33.6
(9.8)
$3,700.1
$3,646.1
(9.9)
10.9
$3,647.1
3.6%
1.5%
($ in millions)
1. 
Includes $45 million of severance recorded in 3Q 2007
2.  Related to fair value accounting election in May 2007

7
Commercial
$34,970    
29%
Residential
Mortgages
$31,604
   26%
Construction
$14,359     
12%
Home Equity
Lines     
$14,599    
12%
Commercial RE
$12,487       
10%
Indirect
$7,642 
7%
Direct
$4,419
4%
Loan Portfolio: $120,748
1
•
Well diversified by product and client
•
Diversified throughout the SunTrust
footprint
•
No material exposure to credit card or
other consumer unsecured lending
•
The Commercial portfolios, which
represent 39% of total loans, are
performing well overall
•
Trend of increasing charge-offs in
residential mortgage and home equity
portfolios, driven by Alt-A
Credit Perspective
(As of 9/30/07, in millions)
1.  Loan Portfolio also includes credit card balances which totaled $668 million

8
Alt-A 1st
$1,106
3%
Prime 2nd
Mortgage
$3,451
11%
Lot Loans
$1,736
5%
Core Mortgage
Portfolio
$19,526
63%
Alt-A 2nd
$631
2%
Home Equity
Loans
$3,788
12%
Wealth &
Investment
Management
$1,366
4%
Residential Mortgages:  $31,604
Credit Perspective
Note:  LTV’s all at origination and FICO scores refreshed quarterly
(As of 9/30/07, in millions)
•
Core Mortgage Portfolio
•
WA LTV of 73%
•
FICO of 729
•
Lot Loans
•
Developed lots for residences
•
WA FICO of 735
•
Prime 2
nds
•
Purchase money
•
Insured seconds
•
Alt-A 1
st
•
WA LTV is 76%
•
Alt-A 2
nd
•
Portfolio is insured
•
Home Equity Loans
•
WA FICO of 725
•
LTV at 71%
•
40% 1
st
lien

9
Home Equity Lines $14,599
Credit Perspective
(As of 09/30/07, in millions)
LTV at Origination and Refreshed FICO
•
Weighted Average FICO 734
•
24% of portfolio in 1st
lien position
•
Origination Channels
–
Lower risk channels (87% of total)
•
Branch channel (64%)
•
Wealth & Investment Management
(11%)
•
Cross sell to mortgage customers
(7%) 
•
Bank Acquisition (5%)
–
Higher risk channels (13% of total)
•
Wholesale (9%)
•
Purchase Money Lines (4%)
•
Weighted Average seasoning 27 Months
LTV -
$
(in millions)
FICO
<70%
71% -
80%
81% -
90%
91%+
Other
Total
730+
2,875
1,654
1,794
1,831
302
8,002
700-729
560
415
488
561
70
1,982
660 -
699
569
412
522
541
77
2,007
<660
385
317
418
457
144
1,630
Not Refreshed
73
14
19
31
69
194
Total
4,462
2,812
3,241
3,422
661
14,599
LTV -
% of Total
FICO
<70%
71% -
80%
81% -
90%
91%+
Other
Total
730+
19.7%
11.3%
12.3%
12.5%
2.1%
58%
700-729
3.8%
2.8%
3.3%
3.8%
0.5%
14%
660 -
699
3.9%
2.8%
3.6%
3.7%
0.5%
15%
<660
2.6%
2.2%
2.9%
3.1%
1.0%
12%
Not Refreshed
0.5%
0.1%
0.1%
0.2%
0.5%
1%
Total
30.6%
19.3%
22.2%
23.4%
4.5%
100%

10
Construction $14,359
Credit Perspective
(As of 9/30/07, in millions)
•
Construction and A&D for
Commercial purposes accounts
for 27% of the construction
portfolio
•
38% of total residential related
development loans are in Florida
(Res A&D, Res Const, CP, and
Raw Land)
•
The total residential construction
and development portfolio  is
made up of many relatively small
loans with an average size of
$560,000
•
Raw Land is $1.0 billion or 0.8%
of the total loan portfolio and is
geographically dispersed
throughout the SunTrust footprint
Other
  $708
5%
Residential
Construction
$2,835
20%
Construction
Perm
  $3,703
26%
Commercial
A&D 
$669
5%
Commercial
Construction
$3,212
22%
Residential
A&D
  $2,208
15%
Raw Land
$1,024
7%

11
Nonaccrual Loans: $975
Credit Perspective
(As of 9/30/07, in millions)
1.  Includes Home Equity lines on nonaccrual status
•
Commercial portfolios are performing well
overall
•
Residential mortgage non accruals:
–
Alt-A loans make up 50% of the non
accruals but only 5% of residential
mortgage portfolio
–
65% of Alt-A non accruals are 1st
lien with an average LTV of 76%
–
Alt-A 2nds are insured and reserves
have been established for potential
denied claims
–
Most of the remaining residential
mortgage non accruals come from
the Core portfolio, with typically
lower LTVs
•
95% of construction non accruals are from   
residential-related construction and 
development
•
The ALLL covers annualized 3Q 2007
charge-offs by 264% driven by the low loss
content of the residential loan portfolio
Consumer 
$11
1%
Commercial RE 
$41
4%
Construction 
$158
16%
Commercial 
$74
8%
Residential
Mortgages
1
$691
71%

12
Appendix

13
3Q 2007 Financial Performance
Balance Sheet
Real Estate 1-4 Family
Real Estate Construction
Real Estate Home Equity Lines
Real Estate Commercial
Commercial
Consumer –
Direct
Consumer –
Indirect
Total Loans
Loans Held for Sale
Trading Assets
Total Securities Available for Sale
Total Earning Assets
Noninterest-Bearing Deposits
NOW Accounts
Money Market Accounts
Savings
Consumer Time
Other Time
Total Consumer and Commercial Deposits
(Average balances, $ in millions)
3Q 2007
% Change
3Q 2006
$    31,003.5
13,686.6
14,133.1
12,759.3
34,247.9
4,368.0
7,966.4
119,558.7
9,748.0
10,692.4
12,587.1
$  152,327.6
$    21,445.1
19,543.4
22,560.3
4,456.5
16,839.9
11,862.4
$    96,707.6
$    33,875.7
12,805.6
13,626.3
12,808.6
34,306.9
4,206.9
8,339.1
120,742.0
11,026.4
2,988.6
23,996.6
$  158,914.7
$    22,933.4
16,596.2
24,267.0
5,591.2
16,402.5
11,852.2
$    97,642.5
(8)%
7%
4%
0%
0%
4%
(4)%
(1)%
(12)%
NM
(48)%
(4)%
(6)%
18%
(7)%
(20)%
3%
0%
(1)%

14
Outlook
1
•
We expect further net interest margin expansion in 4Q 2007; 2008
net interest margin should benefit from
lower short term rates and yield curve steepening.²
•
We do not expect any meaningful increase in large corporate loans related to “hung”
leveraged buy-out
transactions, as SunTrust does not have any significant exposure
in this area.
•
Through mid-year 2008, we anticipate net charge-offs will be in the 35-45 basis point range assuming no
further material deterioration in the economy.²
•
We do not expect a material near-term recovery of the losses associated with the mark-to-market
adjustments realized in 3Q 2007.
•
We expect the tax rate in the fourth quarter to approximate 30%,
resulting in approximately that level for the
full year.²
•
Our Tier 1 capital ratio target remains 7.5%.
•
In the fourth quarter, we intend to replace approximately $650 million of capital instruments with hybrid
securities that have a higher equity content.
•
E²
Efficiency and Productivity Initiative:
–
We anticipate that we will exceed our upwardly revised E²
target of $181 million in estimated gross cost savings for 2007.
–
In conjunction with our corporate real estate space utilization strategy, we have been actively marketing 469 properties over the past
several months.  A majority of these properties are currently under contract.  We expect to have the remaining properties that are for
sale under contract by the end of the year.  We expect to close the remaining sales during the fourth quarter of 2007 and first quarter
of 2008.
–
We are confident that we will achieve our $350 million gross cost savings goal in 2008.
–
Our 2009 gross cost savings goal remains $530 million.
1.
Actual
results
could
differ
materially
from
those
contained
in
or
implied
by
such
statements
-
a
list
of
important
factors
that
could
affect
actual
results
are
listed on slide 1
2.
Assumes no further material deterioration in the economy