EX-99.1 2 l23484aexv99w1.htm EX-99.1 EX-99.1
 

EXHIBIT 99.1
(NATIONALCITY LOGO)
Unaudited
Mid-Quarter Update to Financial Supplement
November 30, 2006
Table of Contents
         
REVIEW OF FINANCIAL TRENDS
     2  
CONSOLIDATED SELECTED AVERAGE BALANCES
     4  
CAPITALIZATION
     5  
FULL-TIME EQUIVALENT EMPLOYEES BY LINE OF BUSINESS
     5  
CONSUMER AND SMALL BUSINESS FINANCIAL SERVICES PERFORMANCE MEASURES
     6  
ASSET MANAGEMENT PERFORMANCE MEASURES
     7  
NATIONAL CITY MORTGAGE STATISTICS
     7  
FIRST FRANKLIN STATISTICS
     8  

 

 

National City Corporation
Review of Financial Trends
This review contains forward-looking statements. Forward-looking statements provide current expectations or forecasts of future events and are not guarantees of future performance, nor should they be relied upon as representing management’s views as of any subsequent date. The forward-looking statements are based on management’s expectations and are subject to a number of risks and uncertainties. Although management believes the expectations reflected in such forward-looking statements are reasonable, actual results may differ materially from those expressed or implied in such statements. Risks and uncertainties that could cause actual results to differ materially include, without limitation, the Corporation’s ability to effectively execute its business plans; changes in general economic and financial market conditions; changes in interest rates; changes in the competitive environment; continuing consolidation in the financial services industry; new litigation or changes in existing litigation; losses, customer bankruptcy, claims and assessments; changes in banking regulations or other regulatory or legislative requirements affecting the Corporation’s business; and changes in accounting policies or procedures as may be required by the Financial Accounting Standards Board or other regulatory agencies. Additional information concerning factors that could cause actual results to differ materially from those expressed or implied in forward-looking statements is available in the Corporation’s Annual Report on Form 10-K for the year ended December 31, 2005, and subsequent filings with the United States Securities and Exchange Commission (SEC). Copies of these filings are available at no cost on the SEC’s Web site at www.sec.gov or on the Corporation’s Web site at www.NationalCity.com. Management may elect to update forward-looking statements at some future point; however, it specifically disclaims any obligation to do so.
Earning Assets, Net Interest Margin, and Net Interest Income
Consistent with recent trends, commercial loan outstandings continue to grow, while the residential real estate and home equity line of credit portfolios are experiencing net declines due to the ongoing “originate-and-sell” strategy for certain of these assets. As a result, overall loan portfolio balances and average earning assets will likely show a linked-quarter decline. Net interest margin has been and is expected to remain relatively stable.
Loan Sales and Servicing
Gain-on-sale margins at National City Mortgage, while benefiting from some improvement in competitive conditions, are showing a mild decline overall due to an increase in wholesale originations, which tend to have lower margins. At National Home Equity, four home equity line sales totaling approximately $2.4 billion, and four home equity loan sales totaling approximately $1.1 billion have been or are expected to be completed this quarter, with gross gain-on-sale margins averaging around 3.4 percent. Gain-on-sale margins for current First Franklin production have been in the two percent area. In addition, $3.6 billion of First Franklin loans that had been in portfolio but moved to held for sale at September 30 were sold in November for a small gain. The total amount sold was less than originally planned due to payoffs and exclusions permitted by the sale contract. Another sale of approximately $650 million is expected to close in December.

2

 

Mortgage servicing right (MSR) net hedging results were a net loss of approximately $45 million pre-tax through the first two months of the quarter.
Credit Quality
Fourth quarter credit trends continue to display relative stability in the core commercial and consumer portfolios. A series of residential development and construction loans referenced in our third quarter earnings conference call, totaling $48 million and involving a single developer, were placed in non-accrual status this quarter. Deterioration is evident in the non-conforming (First Franklin) residential real estate portfolio, which is in run-off. With respect to that portfolio, it is likely that the allocated allowance will be increased, with an additional provision for loan losses currently estimated at $55 million pre-tax for the fourth quarter.
In addition, a portion of the First Franklin portfolio losses covered by third party insurance are subject to reinsurance arrangements in which the Corporation participates in a layer of losses, with a maximum exposure of $130 million. These losses, recorded as non-interest expense in the Consumer and Small Business unit, are forecasted to be approximately $65 million pre-tax in the fourth quarter, bringing cumulative losses to $80 million and leaving a remaining exposure of $50 million under the reinsurance arrangements.
Capital
Other than 600,000 shares acquired in early October, there has been no share repurchase activity in the fourth quarter, due to restrictions associated with pending acquisition transactions. These restrictions will continue into early January, and as a result, the ratio of tangible common equity to assets, 7.34% at November 30, will remain substantially above the current target of 6.50% through year end.
Other
On December 1, 2006, National City completed its previously announced acquisition of Harbor Federal of Fort Pierce, Florida, for a total consideration of 31 million shares of common stock. The Corporation’s other Florida acquisition, Fidelity Bancshares of West Palm Beach, is expected to close in early 2007.
The previously announced sale of the First Franklin origination and servicing platform is expected to close by year end, subject to regulatory approval. Upon closing, the Corporation will realize a gain of approximately $1 billion pre-tax, approaching $1.00 per share after tax.

3

 

Unaudited
National City Corporation
Mid-Quarter Update to Financial Supplement
CONSOLIDATED SELECTED AVERAGE BALANCES
($ in millions)
 
                                                                                                         
    November   October   September   August   July   June   May   April   March   February   January   December   November
    2006   2006   2006   2006   2006   2006   2006   2006   2006   2006   2006   2005   2005
         
                                                                                                       
ASSETS
                                                                                                        
Available for sale securities, at cost
   $ 7,854     $ 7,856     $ 7,897     $ 7,915     $ 7,810     $ 7,854     $ 7,889     $ 7,661     $ 7,635     $ 7,744     $ 7,779     $ 7,796     $ 7,698  
Portfolio loans:
                                                                                                        
Commercial
   $ 29,918     $ 29,775     $ 29,594     $ 29,514     $ 29,530     $ 29,045     $ 28,656     $ 28,429     $ 27,644     $ 27,447     $ 27,355     $ 27,437     $ 27,586  
Commercial construction
     3,994       3,896       3,798       3,739       3,636       3,585       3,520       3,415       3,410       3,456       3,414       3,340       3,295  
Commercial real estate
     11,861       11,954       11,992       12,015       12,172       12,197       12,119       11,981       11,922       11,964       12,175       12,254       12,064  
Residential real estate
     23,286       23,463       24,425       30,203       30,706       31,368       31,842       32,225       32,890       33,118       32,774       32,672       32,809  
Home equity lines of credit
     14,861       15,104       15,401       15,696       15,784       16,798       17,070       17,400       20,524       20,932       21,477       21,435       21,345  
Credit card and other unsecured lines of credit
     2,803       2,747       2,710       2,645       2,610       2,577       2,529       2,479       2,484       2,505       2,555       2,519       2,436  
Other consumer
     5,253       5,358       5,393       5,283       5,234       5,902       6,033       6,101       6,050       6,057       5,978       5,678       5,771  
         
Total portfolio loans
   $ 91,976     $ 92,297     $ 93,313     $ 99,095     $ 99,672     $ 101,472     $ 101,769     $ 102,030     $ 104,924     $ 105,479     $ 105,728     $ 105,335     $ 105,306  
         
Loans held for sale or securitization:
                                                                                                        
Commercial
   $ 35     $ 36     $ 44     $ 52     $ 50     $ 100     $ 66     $ 39     $ 13     $ 11     $ 11     $ 14     $ 33  
Commercial real estate
     39       172       167       92       90       107       108       213       136       47       73       121       174  
Residential real estate:
                                                                                                        
National City Mortgage
     5,547       5,513       5,395       5,674       5,830       5,850       5,825       5,605       5,220       5,327       6,014       6,784       7,069  
First Franklin
     4,060       3,681       3,750       3,799       3,745       3,133       2,693       2,481       2,278       2,061       2,603       2,642       2,920  
National Home Equity
     581       654       1,043       775       471       652       592       427       258       124       —       —       —  
National City Home Loan Services
     4,876       5,890       5,349       —       —       —       —       —       —       —       —       —       —  
         
Total residential real estate loans held for sale
     15,064       15,738       15,537       10,248       10,046       9,635       9,110       8,513       7,756       7,512       8,617       9,426       9,989  
Automobile loans
     —       —       —       —       —       —       —       —       —       —       —       —       2,178  
Credit card loans
     —       —       —       —       —       —       —       —       398       425       425       415       207  
Home equity lines of credit
     2,236       3,509       3,289       2,928       2,736       3,746       3,574       3,055       407       613       —       —       —  
Student loans
     4       8       14       18       12       4       3       4       4       4       4       4       3  
         
Total loans held for sale or securitization
   $ 17,378     $ 19,463     $ 19,051     $ 13,338     $ 12,934     $ 13,592     $ 12,861     $ 11,824     $ 8,714     $ 8,612     $ 9,130     $ 9,980     $ 12,584  
         
LIABILITIES
                                                                                                        
Deposits:
                                                                                                        
Noninterest bearing
   $ 16,507     $ 16,473     $ 16,593     $ 16,804     $ 16,818     $ 16,960     $ 16,861     $ 17,355     $ 16,830     $ 16,607     $ 16,844     $ 17,606     $ 17,809  
NOW and money market accounts
     29,370       28,895       28,819       28,842       28,771       28,865       28,731       29,023       28,603       28,201       28,282       28,401       28,115  
Savings accounts
     1,790       1,820       1,854       1,895       1,960       2,012       2,038       2,077       2,098       2,089       2,128       2,172       2,185  
Consumer time
     22,198       22,096       22,049       22,025       21,826       21,671       21,534       21,188       20,959       20,684       20,574       20,370       20,115  
         
Core deposits
     69,865       69,284       69,315       69,566       69,375       69,508       69,164       69,643       68,490       67,581       67,828       68,549       68,224  
Other
     4,375       4,714       5,278       5,259       5,095       5,249       6,167       6,136       6,453       6,553       6,612       6,863       6,753  
Foreign
     10,147       10,042       8,933       9,232       8,469       8,696       7,383       6,478       6,771       8,976       9,709       7,729       9,479  
         
Total deposits
   $ 84,387     $ 84,040     $ 83,526     $ 84,057     $ 82,939     $ 83,453     $ 82,714     $ 82,257     $ 81,714     $ 83,110     $ 84,149     $ 83,141     $ 84,456  
         
Federal funds borrowed and security repurchase agreements
   $ 7,100     $ 8,356     $ 7,903     $ 6,625     $ 6,130     $ 5,759     $ 4,773     $ 4,811     $ 5,684     $ 5,891     $ 6,988     $ 7,541     $ 8,986  
Borrowed funds
     2,098       2,428       2,168       1,846       1,772       2,373       3,602       2,298       1,968       2,635       1,981       3,059       2,401  
Long-term debt
     25,839       25,566       27,451       29,132       31,648       32,925       32,940       33,402       33,128       31,374       30,622       31,452       31,394  
Memo:
                                                                                                        
Noninterest bearing escrow balances
   $ 4,169     $ 4,037     $ 4,129     $ 4,273     $ 4,343     $ 4,218     $ 4,006     $ 4,031     $ 3,824     $ 3,620     $ 3,506     $ 4,136     $ 4,346  
Interest bearing escrow balances
     136       131       128       134       148       144       139       133       134       135       140       139       135  
Noninterest bearing deposits excluding escrow balances
     12,338       12,436       12,464       12,531       12,475       12,742       12,855       13,324       13,006       12,987       13,338       13,470       13,463  
Core deposits excluding escrow balances
     65,560       65,116       65,058       65,159       64,884       65,146       65,019       65,479       64,532       63,826       64,182       64,274       63,743  

4

 

Unaudited
National City Corporation
Mid-Quarter Update to Financial Supplement
CAPITALIZATION (Period End)
(in millions, except per share data)
 
                                                                                                         
    November   October   September   August   July   June   May   April   March   February   January   December   November
    2006   2006   2006   2006   2006   2006   2006   2006   2006   2006   2006   2005   2005
       
COMMON STOCK ROLLFORWARD
                                                                                                        
Beginning balance
     602.2       601.9       603.3       604.9       605.1       609.9       609.5       610.0       610.3       613.8       615.0       615.0       619.3  
Shares issued under stock award plans
     .6       1.0       .6       .2       .6       .9       1.9       .8       .9       1.3       .9       .5       .4  
Shares repurchased under repurchase authorizations
     —       (.6 )     (2.0 )     (1.7 )     (.6 )     (5.6 )     (1.2 )     (.9 )     (1.0 )     (4.4 )     (2.1 )     (.4 )     (4.6 )
Shares exchanged for stock award plans
     (.2 )     (.1 )     —       (.1 )     (.2 )     (.1 )     (.3 )     (.4 )     (.2 )     (.4 )     —       (.1 )     (.1 )
         
Ending Balance
     602.6       602.2       601.9       603.3       604.9       605.1       609.9       609.5       610.0       610.3       613.8       615.0       615.0  
         
COMMON STOCK REPURCHASE ACTIVITY
                                                                                                        
Number of common shares repurchased
     —       .6       2.0       1.7       .6       5.6       1.2       .9       1.0       4.4       2.1       .4       4.6  
Average price per share of repurchased common shares
     —     $ 37.02     $ 36.21     $ 36.32     $ 36.31     $ 36.12     $ 37.00     $ 34.92     $ 34.62     $ 34.05     $ 33.96     $ 33.78     $ 32.70  
Total cost
     —     $ 22.7     $ 71.1     $ 62.4     $ 22.3     $ 204.3     $ 44.4     $ 30.6     $ 35.8     $ 149.6     $ 70.7     $ 14.0     $ 150.4  
Common shares remaining under authorization
     13.5       13.5       14.1       16.1       17.8       18.4       24.0       25.2       26.1       27.1       31.5       33.6       34.0  
Shares outstanding:
                                                                                                        
Average basic
     602.4       601.8       602.7       603.7       605.1       608.9       610.3       609.8       609.6       610.9       615.1       615.1       615.7  
Average diluted
     611.2       610.7       611.0       611.9       613.3       617.5       619.4       617.7       617.7       618.6       622.7       622.8       622.8  
FULL-TIME EQUIVALENT EMPLOYEES BY LINE OF BUSINESS(1)
 
                                                                                                         
    November   October   September   August   July   June   May   April   March   February   January   December   November
    2006   2006   2006   2006   2006   2006   2006   2006   2006   2006   2006   2005   2005
         
                                                                                                       
Line of business staff:
                                                                                                        
Consumer and Small Business Financial Services
     12,773       12,714       12,764       12,787       12,807       12,780       12,481       12,494       12,488       12,418       12,437       12,315       12,274  
Wholesale Banking
     2,466       2,465       2,459       2,472       2,427       2,427       2,442       2,449       2,458       2,454       2,491       2,498       2,507  
National City Mortgage
     6,843       6,764       6,837       6,860       6,937       7,088       7,268       7,344       7,305       7,345       7,352       7,673       7,703  
National Consumer Finance:
                                                                                                        
First Franklin Financial Corporation
     2,506       2,460       2,475       2,446       2,441       2,451       2,390       2,390       2,406       2,432       2,412       2,571       2,676  
National City Home Loan Services
     640       600       593       573       567       579       560       554       518       510       517       510       510  
National Home Equity
     438       436       440       435       436       469       468       474       484       488       494       503       504  
National Recreation Finance
     —       —       1       4       10       10       49       49       52       52       52       56       63  
         
Total National Consumer Finance
     3,584       3,496       3,509       3,458       3,454       3,509       3,467       3,467       3,460       3,482       3,475       3,640       3,753  
Asset Management
     1,505       1,498       1,486       1,505       1,513       1,518       1,525       1,532       1,520       1,511       1,502       1,506       1,526  
Corporate support staff(2)
     6,580       6,539       6,566       6,609       6,600       6,629       6,600       6,576       6,617       6,596       6,602       6,638       6,707  
         
Total Employees
     33,751       33,476       33,621       33,691       33,738       33,951       33,783       33,862       33,848       33,806       33,859       34,270       34,470  
         
 
(1)   Represents period-end, active, full-time equivalent employees
 
(2)   Personnel expense associated with corporate staff are allocated to the lines of business either directly based on usage or indirectly as part of the general overhead allocation process

5

 

Unaudited
National City Corporation
Mid-Quarter Update to Financial Supplement
CONSUMER AND SMALL BUSINESS FINANCIAL SERVICES PERFORMANCE MEASURES
(in millions)
 
                                                                                                         
    November   October   September   August   July   June   May   April   March   February   January   December   November
    2006   2006   2006   2006   2006   2006   2006   2006   2006   2006   2006   2005   2005
         
                                                                                                       
Average Total Deposits(1)
   $ 56,781     $ 56,407     $ 56,392     $ 56,367     $ 56,425     $ 56,481     $ 55,965     $ 56,028     $ 55,498     $ 54,770     $ 54,694     $ 54,949     $ 54,461  
DEPOSIT ACCOUNT METRICS(1) (2)
                                                                                                        
Personal Deposits:
                                                                                                        
Noninterest Bearing Checking
                                                                                                        
Average total balance
   $ 2,914     $ 2,934     $ 3,002     $ 2,988     $ 3,059     $ 3,095     $ 3,123     $ 3,306     $ 3,252     $ 3,210     $ 3,147     $ 3,135     $ 3,096  
Number of accounts(3)
     1,707       1,714       1,723       1,729       1,720       1,717       1,711       1,715       1,726       1,733       1,737       1,737       1,747  
Interest Bearing Checking
                                                                                                        
Average total balance
   $ 8,078     $ 7,994     $ 8,030     $ 8,037     $ 8,073     $ 8,133     $ 8,109     $ 8,326     $ 8,098     $ 7,929     $ 8,010     $ 8,035     $ 7,900  
Number of accounts(3)
     1,129       1,120       1,108       1,095       1,075       1,061       1,044       1,025       1,008       991       979       969       961  
Money Market Savings
                                                                                                        
Average total balance
   $ 13,862     $ 13,743     $ 13,710     $ 13,753     $ 13,762     $ 13,822     $ 13,773     $ 13,697     $ 13,683     $ 13,556     $ 13,481     $ 13,376     $ 13,261  
Number of accounts(3)
     971       960       948       933       905       888       869       851       836       815       794       779       768  
Regular savings
                                                                                                        
Average total balance
   $ 1,555     $ 1,580     $ 1,605     $ 1,652     $ 1,717     $ 1,764     $ 1,793     $ 1,819     $ 1,833     $ 1,815     $ 1,839     $ 1,864     $ 1,896  
Number of accounts(3)
     540       547       556       563       574       583       591       599       607       616       624       634       642  
Business Deposits:
                                                                                                        
Average total balance
   $ 8,779     $ 8,674     $ 8,631     $ 8,539     $ 8,611     $ 8,619     $ 8,304     $ 8,289     $ 8,285     $ 8,200     $ 8,324     $ 8,773     $ 8,772  
Number of accounts(3)
     404       403       402       400       396       395       394       392       390       388       387       387       387  
Time Deposits:
                                                                                                        
Average total balance
   $ 21,479     $ 21,380     $ 21,311     $ 21,294     $ 21,107     $ 20,957     $ 20,767     $ 20,506     $ 20,259     $ 19,980     $ 19,828     $ 19,692     $ 19,475  
Number of accounts(3)
     1,054       1,051       1,053       1,054       1,048       1,039       1,038       1,032       1,022       1,013       1,007       1,005       1,004  
CONSUMER LOAN PRODUCTION METRICS (# of loans)(2)
                                                                                                        
Installment loan originations:
                                                                                                        
Home equity(4)
     2,124       2,337       2,110       3,074       2,531       2,491       2,421       1,966       2,702       3,853       1,792       1,854       1,879  
Other(5)
     2,126       2,137       1,912       2,331       2,098       2,057       2,264       1,689       1,570       1,022       997       879       969  
Home equity and other lines of credit
     5,833       6,547       6,550       6,720       5,087       6,541       6,577       6,912       6,193       4,581       4,157       5,044       5,527  
         
Total consumer loan originations
     10,083       11,021       10,572       12,125       9,716       11,089       11,262       10,567       10,465       9,456       6,946       7,777       8,375  
         
BANK BRANCHES AND OTHER
                                                                                                        
Total bank branches
     1,254       1,254       1,253       1,254       1,248       1,245       1,243       1,231       1,230       1,230       1,227       1,220       1,220  
ATMs
     1,965       1,964       1,960       1,957       1,960       1,968       1,967       1,954       1,949       1,945       1,938       1,935       1,934  
Online banking customers
     1,621,800       1,604,609       1,572,084       1,539,606       1,492,613       1,462,992       1,421,577       1,390,907       1,359,249       1,328,120       1,298,121       1,276,855       1,261,859  
 
(1)   Restated to reflect the reassignment of certain deposits with the Wholesale Banking line of business.
 
(2)   Excludes Education Finance and National City Card Services. Additionally, home equity loans generated by the National Home Equity division of the National Consumer Finance line of business are excluded from the consumer loan production metrics.
 
(3)   Represents period-end number of accounts in thousands.
 
(4)   Represents closed-end home equity installment loans included in real estate residential portfolio loans on the consolidated balance sheet.
 
(5)   Represents other secured installment loans. Periods prior to 2006 also included automobile, truck, boat, and recreational vehicle loans.

6

 

Unaudited
National City Corporation
Mid-Quarter Update to Financial Supplement
ASSET MANAGEMENT PERFORMANCE MEASURES
(in millions)
 
                                                                                                         
    November   October   September   August   July   June   May   April   March   February   January   December   November
    2006   2006   2006   2006   2006   2006   2006   2006   2006   2006   2006   2005   2005
       
ASSETS UNDER ADMINISTRATION
                                                                                                        
Managed assets:
                                                                                                        
Value at beginning of period
   $ 60,546     $ 60,468     $ 59,744     $ 58,736     $ 59,217     $ 61,230     $ 62,131     $ 62,669     $ 66,748     $ 66,047     $ 65,010     $ 64,290     $ 63,914  
Estimated change due to market impact
     651       698       731       963       446       (551 )     (594 )     452       939       6       1,039       316       1,146  
Other activity, net
     608       (620 )     (7 )     45       (927 )     (1,462 )     (307 )     (990 )     (5,018 )     695       (2 )     404       (770 )
         
Value at end of period
     61,805       60,546       60,468       59,744       58,736       59,217       61,230       62,131       62,669       66,748       66,047       65,010       64,290  
         
Non-managed assets:
                                                                                                        
Value at beginning of period
     51,725       50,910       49,784       49,798       48,261       48,633       48,404       48,018       43,340       43,487       42,750       42,229       41,546  
Estimated change due to market impact
     595       423       875       8       839       (168 )     (192 )     456       306       (14 )     934       269       896  
Other activity, net
     (489 )     392       251       (22 )     698       (204 )     421       (70 )     4,372       (133 )     (197 )     252       (213 )
         
Value at end of period
     51,831       51,725       50,910       49,784       49,798       48,261       48,633       48,404       48,018       43,340       43,487       42,750       42,229  
         
Total assets at end of period
   $ 113,636     $ 112,271     $ 111,378     $ 109,528     $ 108,534     $ 107,478     $ 109,863     $ 110,535     $ 110,687     $ 110,088     $ 109,534     $ 107,760     $ 106,519  
         
Proprietary mutual fund assets (included above)
   $ 12,545     $ 12,036     $ 11,946     $ 11,879     $ 11,672     $ 11,848     $ 11,833     $ 11,828     $ 12,198     $ 12,078     $ 12,040     $ 12,213     $ 11,567  
NATIONAL CITY MORTGAGE STATISTICS
$ in millions)
 
                                                                                                         
    November   October   September   August   July   June   May   April   March   February   January   December   November
    2006   2006   2006   2006   2006   2006   2006   2006   2006   2006   2006   2005   2005
         
                                                                                                       
ORIGINATION AND SALES DATA
                                                                                                        
Applications(1)
   $ 6,323     $ 6,514     $ 5,871     $ 6,462     $ 5,361     $ 5,979     $ 6,508     $ 6,017     $ 7,137     $ 5,517     $ 5,648     $ 4,579     $ 6,029  
Percentage of applications represented by refinances
     53 %     58 %     56 %     52 %     48 %     46 %     46 %     45 %     47 %     49 %     53 %     53 %     50 %
Originations:
                                                                                                        
Retail
   $ 2,162     $ 2,276     $ 2,196     $ 2,439     $ 2,225     $ 2,625     $ 2,571     $ 2,294     $ 2,398     $ 1,994     $ 1,803     $ 2,253     $ 2,462  
Wholesale
     1,429       1,539       1,225       1,318       1,030       1,343       1,336       1,260       1,438       1,138       1,107       1,444       1,392  
Less: loan originations for other units (NHE) and portfolio
     (409 )     (431 )     (398 )     (402 )     (366 )     (404 )     (408 )     (427 )     (430 )     (373 )     (334 )     (395 )     (423 )
         
Total originations for sale
   $ 3,182     $ 3,384     $ 3,023     $ 3,355     $ 2,889     $ 3,564     $ 3,499     $ 3,127     $ 3,406     $ 2,759     $ 2,576     $ 3,302     $ 3,431  
         
Percentage of originations represented by refinances
     56 %     56 %     52 %     48 %     47 %     43 %     46 %     48 %     50 %     55 %     55 %     48 %     51 %
Loan Sales:
                                                                                                        
Loans sold servicing retained
   $ 2,564     $ 2,070     $ 2,581     $ 2,325     $ 2,504     $ 2,868     $ 2,549     $ 2,167     $ 2,198     $ 3,028     $ 3,010     $ 3,347     $ 2,863  
Loans sold servicing released
     358       467       231       463       316       235       237       266       258       161       108       202       242  
         
Total loan sales
   $ 2,922     $ 2,537     $ 2,812     $ 2,788     $ 2,820     $ 3,103     $ 2,786     $ 2,433     $ 2,456     $ 3,189     $ 3,118     $ 3,549     $ 3,105  
         
SERVICING DATA
                                                                                                        
Mortgage loans serviced for third parties
   $ 161,984     $ 161,740     $ 162,202     $ 161,653     $ 160,895     $ 161,096     $ 160,652     $ 160,777     $ 160,983     $ 161,380     $ 160,441     $ 159,580     $ 159,040  
 
(1)   Includes loans originated for sale and to be held in portfolio

7

 

Unaudited
National City Corporation
Mid-Quarter Update to Financial Supplement
FIRST FRANKLIN STATISTICS(1)
(in millions)
 
                                                                                                         
    November   October   September   August   July   June   May   April   March   February   January   December   November
    2006   2006   2006   2006   2006   2006   2006   2006   2006   2006   2006   2005   2005
       
ORIGINATION AND SALES DATA
                                                                                                        
Applications(2)
   $ 4,261     $ 4,994     $ 4,024     $ 4,707     $ 4,033     $ 4,583     $ 4,137     $ 3,348     $ 3,633     $ 3,233     $ 3,123     $ 3,605     $ 3,711  
Originations:
                                                                                                        
Total loan originations
   $ 2,559     $ 2,854     $ 2,370     $ 2,891     $ 2,481     $ 2,696     $ 2,290     $ 1,790     $ 2,036     $ 1,777     $ 1,765     $ 2,327     $ 2,203  
Less: portfolio loan originations
     —       —       —       (1 )     —       (1 )     —       —       (222 )     (199 )     (459 )     (223 )     (654 )
         
Total originations for sale
   $ 2,559     $ 2,854     $ 2,370     $ 2,890     $ 2,481     $ 2,695     $ 2,290     $ 1,790     $ 1,814     $ 1,578     $ 1,306     $ 2,104     $ 1,549  
         
Percentage of originations represented by refinances
     35 %     37 %     27 %     28 %     27 %     24 %     27 %     29 %     31 %     34 %     36 %     32 %     33 %
Weighted-average note rate
     8.08 %     8.11 %     8.43 %     8.42 %     8.39 %     8.29 %     8.29 %     8.23 %     8.19 %     8.14 %     8.10 %     8.00 %     7.83 %
Weighted-average credit score(3)
     657       654       648       649       651       652       649       653       654       651       652       655       652  
Sales to third parties:
                                                                                                        
Loans sold servicing retained
   $ 2,741     $ 2,553     $ 4,146       —     $ 2,649     $ 464     $ 1,682     $ 2,089     $ 1,192     $ 1,400     $ 1,623     $ 2,071     $ 1,530  
Loans sold servicing released
     —       —       —     $ 868       —       1,928       —       —       —       —       —       —       —  
         
Total Loan sales
   $ 2,741     $ 2,553     $ 4,146     $ 868     $ 2,649     $ 2,392     $ 1,682     $ 2,089     $ 1,192     $ 1,400     $ 1,623     $ 2,071     $ 1,530  
         
Total loan sale revenue
   $ 43     $ 33     $ 8     $ 12     $ 42     $ 59     $ 25     $ 29     $ 26     $ 23     $ 11     $ 29     $ 18  
PORTFOLIO STATISTICS(4)
                                                                                                        
Period-end portfolio balance
   $ 7,903     $ 8,257     $ 8,302     $ 15,326     $ 16,000     $ 16,583     $ 17,281     $ 17,918     $ 18,254     $ 18,693     $ 18,774     $ 18,681     $ 18,801  
Weighted-average note rate
     7.92 %     7.87 %     7.83 %     7.53 %     7.51 %     7.48 %     7.45 %     7.41 %     7.34 %     7.29 %     7.25 %     7.18 %     7.12 %
Weighted-average loan size
   $ 93,614     $ 94,528     $ 95,025     $ 101,908     $ 102,390     $ 102,939     $ 103,645     $ 104,339     $ 106,513     $ 108,389     $ 109,371     $ 110,417     $ 111,752  
Weighted-average credit score(3)(5)
     629       635       635       644       644       645       645       647       647       647       646       652       652  
First-lien weighted-average loan-to-value ratio(6)
     77.75 %     77.84 %     77.92 %     77.19 %     77.25 %     77.31 %     77.37 %     77.44 %     77.48 %     77.55 %     77.57 %     77.57 %     77.58 %
SERVICING DATA
                                                                                                        
Mortgage loans serviced for third parties
   $ 35,850     $ 30,573     $ 28,626     $ 24,952     $ 25,521     $ 23,288     $ 23,287     $ 22,021     $ 20,232     $ 19,391     $ 18,266     $ 16,909     $ 15,105  
 
(1)   First Franklin loans are nonconforming residential real estate loans originated by First Franklin Financial Corp., a wholly-owned subsidiary of National City Corporation and a division of the National Consumer Finance line of business.
 
(2)   Includes loans originated for sale and to be held in portfolio.
 
(3)   Represents the Fair Isaac Corporation FICO® score, a benchmark credit rating system used by most financial companies and National City Corporation. National City is not affiliated with Fair Isaac Corporation and obtains FICO® scores from third-party credit bureaus.
 
(4)   These loans are retained in the residential real estate portfolio.
 
(5)   Based upon most recent available FICO® score for borrowers. FICO® scores are updated quarterly.
 
(6)   Based upon period-end first-lien mortgage loan balance divided by the most recent obtained value of the underlying mortgaged property.

8