Exhibit 99.1

FIRST QUARTER 2008

FINANCIAL SUPPLEMENT

If you need further information, please contact:

Dave Miller, Investor Relations

901-523-4162

dwmiller@firsthorizon.com

TABLE OF CONTENTS
				Page
First Horizon National Corporation Segment Structure				3
Performance Highlights				4
Efficiency and Restructuring Initiatives				6
Consolidated Results
	Income Statement
		Summary Income Statement		7
		Income Statement		8
		Other Income and Other Expense		9
	Balance Sheet
		Period End Balance Sheet		10
		Average and Period End Loans		11
		Average Balance Sheet		12
			Average Balance Sheet: Income & Expense	13
			Average Balance Sheet: Yields & Rates	14
	Mortgage Servicing Rights			15
Business Segment Detail
		Segment Highlights		16
		Regional Banking		17
		Capital Markets		18
		National Specialty Lending		19
		Mortgage Banking		20
			Mortgage Banking: Origination Income	21
			Mortgage Banking: Origination Metrics	22
			Mortgage Banking: Servicing	23
		Corporate		24
Capital Highlights				25
Asset Quality
		Asset Quality: Consolidated		26
		Asset Quality: Regional Banking		28
		Asset Quality: National Specialty Lending		29
		Asset Quality: Mortgage Banking & Capital Markets		30
		Asset Quality Highlights: Key Portfolios		31
		Asset Quality Process		32
Glossary of Terms				33
Other Information
This financial supplement contains forward-looking statements involving significant risks and uncertainties.  A number of important
factors could cause actual results to differ materially from those in the forward-looking information.  Those factors include general
economic and financial market conditions, including expectations of and actual timing and amount of interest rate movements including
the slope of the yield curve, competition, customer and investor responses to these conditions, ability to execute business plans,
geopolitical developments, natural disasters, and items mentioned in this financial supplement and in FHN's most recent press release,
as well as critical accounting estimates and other factors described in FHN’s recent filings with the SEC.  FHN disclaims any obligation
to update any such factors or to publicly announce the result of any revisions to any of the forward-looking statements included herein
or therein to reflect future events or developments.

FIRST HORIZON NATIONAL CORPORATION SEGMENT STRUCTURE

 

Regional Banking
-Traditional banking services for consumers and business
-Activities include lending and deposit taking, investments, insurance, financial planning, trust services, asset management,
cash management, and health savings accounts
-Primarily southeastern US footprint, with approximately 200 financial centers in TN and nearby markets
-First Tennessee banking franchise and middle market lending are key businesses
-First Horizon Banks included, although most branches have been sold and the final divestiture is in process as of March 2008
-Formerly included in prior "Retail/Commercial Banking" segment
Capital Markets
-Fixed income sales, trading, and strategies for institutional clients in U.S. and abroad
-Other capital markets products include:
	-Equity research, portfolio advisory, structured finance and investment banking
-Correspondent banking provides credit depository and other banking related services to other financial institutions
	-Formerly included in prior "Retail/Commercial Banking" segment
National Specialty Lending
-Primarily portfolio lending activities such as consumer lending and construction lending outside Regional Banking footprint
-Construction lending includes national home builder, one-time close, and commercial real estate portfolios
	-In January 2008, FHN announced the discontinuation of national home builder and commercial real estate
	lending through its First Horizon Construction Lending offices
-Consumer lending consists mainly of national retail-originated home equity loans and lines
-Formerly included in prior "Retail/Commercial Banking" segment
Mortgage Banking
-Primarily consists of first lien mortgage originations and servicing
-Minimal change compared to prior segment disclosure
Corporate
- Includes executive management, enterprise-wide risk management, corporate finance,
corporate communications and legal functions
-Also includes funding function for the corporation and any impact from balance sheet positioning
-Minimal change compared to prior segment disclosure

3

PERFORMANCE HIGHLIGHTS
Summary of First Quarter 2008 Significant Items (in millions)
Segment			Item	Income Statement	Pre-Tax		Comments
Regional Banking			Loan losses	Provision for loan losses	$(75.3	)	Provisioning for increased deterioration in loan portfolio.
Capital Markets			LOCOM on pooled trust preferred warehouse	Noninterest income: Capital Markets	$(36.2	)	Decline in fair value of warehouse due to widening of credit spreads during the quarter.  Partially offset by a decrease of approximately $12 million in noninterest expenses.
			Loan losses	Provision for loan losses	$(15.0	)	Provisioning for correspondent banking loans.
National Specialty Lending			Loan losses	Provision for loan losses	$(149.5	)	Provisioning reflects additional deterioration in national construction portfolios and inherent losses in home equity lending portfolio.
Mortgage Banking			Adoption of accounting standards	Noninterest income: Mortgage Banking	$96.9		Effects of implementing fair value measurements standard, prospectively electing fair value accounting for almost the entire mortgage warehouse and prospectively recognizing the value of servicing in interest rate lock commitments.
			LOCOM for warehouse	Noninterest income: Mortgage Banking	$(17.0)		Adjustments to carrying values for spread widening and rising delinquencies.
			Election of fair value for mortgage warehouse on SFAS 91 deferrals	Noninterest expense: Various (primarily employee compensation, incentives and benefits)	$(54.5	)	Effect of no longer deferring origination costs for warehouse loans which are now carried at fair value.  Offsetting amount included above as increase in Mortgage Banking noninterest income.
Corporate			Visa IPO gain	Noninterest income: Securities gains/(losses), net	$65.9		Gain on shares redeemed as part of IPO process.
			Visa legal settlement accrual reversal	Noninterest expense: Other	$30.0		Reversal of proportionate share of escrow account established by Visa for certain Visa litigation matters for which FHN has a contingent guarantee.
			Restructuring, Repositioning & Efficiency Initiatives	Noninterest expense: Various	$(17.6	)	Expenses from severance, office closures and First Horizon Banks divestitures.  Detailed further on page 6.
			Restructuring, Repositioning & Efficiency Initiatives	Noninterest income: Various	$(3.7	)	Disposition of 10 First Horizon Bank branches.  Transaction costs for sale of MSR on $7.5 billion of principal.  Detailed further on page 6.
(First Quarter 2008 vs. Fourth Quarter 2007)
Asset Quality
- Provision increased to $240.0 million in the current quarter compared to $156.6 million in fourth quarter 2007
	- Portfolio deterioration in current quarter due to declining economic conditions
	- Continuing to apply focused portfolio management activities to identify problem assets
		- Loan level reviews of commercial real estate and C&I portfolios
		- Home equity loss trends prompted the need for additional reserves given loss severities being experienced
		- Trends in the one-time close portfolio prompted the need for additional reserves
- Net charge-offs were 181 annualized basis points of average loans driven by national construction, consumer lending and C&I portfolios
	- Charging off balances down to most likely estimate of collateral value net of costs to sell
- NPAs increased to 278 basis points from 166 basis points reflecting portfolio deterioration from current economic conditions
	- Total NPAs increased to $620.9 million from $392.4 million primarily from deterioration in national construction portfolios
- Allowance as a percentage of loans ratio increased to 220 basis points from 155 basis points in prior quarter
Capital
- Declared quarterly dividend of $.20 per share
- Current Ratios (estimated based on period end balances)
	- 6.08% for tangible common equity to risk weighted assets
	- 8.10% for Tier I
	- 12.82% for Total Capital

4

PERFORMANCE HIGHLIGHTS (continued)
(First Quarter 2008 vs. Fourth Quarter 2007)
Regional Banking
- Excluding deposits held for sale, average core deposits increased 2% over prior quarter
- Net interest margin declined to 4.39% compared to 4.74% in fourth quarter
	- Reflects inability to pass through all Federal Reserve rate cuts to deposit customers
	- Approximately one-third is offset in Corporate segment due to internal interest allocation
- Noninterest income decreased to $87.1 million from $95.5 million
	- Seasonal decline in fee income
- Provision expense in current quarter reflects increased deterioration in commercial loans
- Noninterest expense declines primarily attributable to effect of efficiency initiatives
	- Partially offset by seasonal increases in personnel costs
	- Prior quarter included recognition of losses on owned real estate and reductions in value of low income housing investments
- Completed disposition of 10 First Horizon Bank branches
	- 9 additional branches expected to be sold in second quarter 2008
	-Loans of $207.7 million and deposits of $118.7 million remain classified as held-for-sale
Capital Markets
- Fixed income revenues were $152.2 million in current quarter compared to $77.1 million in prior quarter
	- Increase in activity during first quarter as Federal Reserve aggressively lowered rates resulting in a steeper yield curve
- Other product revenues decreased to $(18.3) million from $26.2 million
	- No pooled trust preferred transaction executed during first quarter
	- $36.2 million LOCOM adjustment on warehouse to reflect widening of credit spreads
		- Approximate $12 million offsetting decrease in noninterest expense
- Provision increased to $15.0 million from $1.2 million to reflect deterioration of correspondent banking loans
		- Loans participated in through downstream correspondent banks
- Increase in noninterest expense resulted from higher production levels
National Specialty Lending
- Net interest margin declined to 2.31% compared to 2.42% in fourth quarter
	- Driven by additional non-accrual construction loans
- Increased provision for loan losses reflects additional deterioration within national construction portfolios
	- Recognition of inherent losses in consumer lending also contributed
- Contraction of portfolios will continue since origination activity has been significantly curtailed
- Noninterest income improved as repurchase reserves were significantly less than prior quarter
	- Partially offset by decline in value of servicing assets to reflect rate reductions
- Noninterest expense declined from the effects of business reductions initiated during the quarter
Mortgage Banking
- Net effect of adopting new accounting standards positively affected pre-tax earnings by $42.4 million
	- Adoption of SFAS 157 negatively affected earnings by $15.7 million related to valuation of interest rate lock commitments
	- Prospective application of SAB 109 and SFAS 159 positively impacted earnings by $58.1 million
		- Related to recognition of MSR values in interest rate lock commitments and loans
- Increased origination income
	- 35% increase in deliveries and 19% increase in originations as lower rates drove increased refinance activity
	- Gain (loss) on sale margin declined to (20) basis points from 5 basis points
		- Spread widening on adjustable rate and non-agency eligible production continues to adversely impact margins
		- LOCOM adjustments of $17 million in current quarter vs. $10.9 million in prior quarter
- Hedging results positively impacted earnings by $32.7 million vs. $18.6 million negative effect in fourth quarter
	- Resulted from wider mortgage-swap spreads and decreased options expense
	- In prior quarter, value of MSR and other retained interests reduced by $135.3 million from placing more emphasis on broker price discovery
- Net interest income increased in line with increase in warehouse margin and increase in average warehouse balance
- Decrease in servicing runoff to $37.4 million for current quarter from $41.0 million in prior quarter
- Noninterest expense decreased to $147.5 million in current quarter from $174.2 million in fourth quarter
	- $71.1 million impairment of goodwill and $4.8 million legal settlement accrual in fourth quarter
	- Partially offset by $54.5 million increase in noninterest expense (primarily compensation costs) related to loan originations for which fair value was elected
		- Amount is offset by corresponding increase in gain on sale
Corporate Segment
- Visa IPO resulted in $95.9 million improvement in pre-tax earnings
	- Equity securities gains of $65.9 million for shares redeemed in conjunction with IPO
	- $30.0 million of expense reversals associated with Visa's funding of escrow account for certain Visa litigation matters
		- $25.7 million of contingent liability remains for estimated pro rata share of remaining contingent liability for these matters
		- 2.4 million restricted shares retained after IPO will be carried at historical cost basis of $0
- Net charges of $21.3 million recognized for restructuring, repositioning and efficiency initiatives (detail on next page)
	- Current quarter included $17.6 million of expenses, including $2.5 million of asset impairments
	- $2.7 million of transaction costs from sale of mortgage servicing rights presented as reduction of Mortgage Banking income
	- $1.0 million of losses related to First Horizon Bank branch sales presented in (Losses)/Gains on Divestitures
	- Prior quarter included $26.6 million of net charges for these initiatives
- Equity security losses of $10.4 million recognized in prior quarter for impairment of other equity securities

Taxes

 - Approximate $8 million positive quarterly effect from permanent tax credits

5

EFFICIENCY AND RESTRUCTURING INITIATIVES
Unaudited
Summary of Key Initiatives
				Expected Annualized		Expected Timing to Fully Realize
	Area	Key Components		Pre-Tax Benefit		Annual Pre-Tax Benefits
	Enterprise Efficiency Initiatives	Organization and compensation redesign		$175 Million		In 1Q08 run-rate
	(3 Phases)	Procurement & multisourcing
		Repositioning non-core businesses
		Other (facilities, process streamlining, loan divestiture)
	First Horizon Bank Divestitures	Selling 34 full-service locations in VA, MD, GA, TX		$30 Million		Approximately $10 million annualized
						in 1Q08 run-rate; remainder by 3Q08
	Mortgage Restructuring	Eliminating bottom half of retail sales force				In 1Q08 run-rate
		Reducing management & wholesale AEs
		Decreasing support staff and back-office costs
		Closing over 60 offices
				$40 Million
	Downsizing National Lending	Reducing consumer and construction sales forces				Majority in 1Q08
		Decreasing support staff and back-office costs				remainder over 2008
		Cutting network of national FSMs

Charges for Restructuring, Repositioning, and Efficiency
By Income Statement Impact (Thousands, rounded)		1Q08			4Q07			3Q07			2Q07
Provision for loan losses	$	-		$	-		$	-		$	7,700
Noninterest income
Mortgage banking		(2,700	)		(6,400	)		-			-
Losses/gains on divestitures		(1,000	)		15,700			-			-
Noninterest expense
Employee compensation, incentives, and benefits		7,400			8,400			9,300			8,000
Occupancy		1,000			5,500			5,100			3,700
Operations services		-			400			-			-
Equipment rentals, depreciation, and maintenance		-			500			800			5,200
All other expense		9,200			21,100			17,600			14,700
Total Income before income taxes	$	(21,300	)	$	(26,600	)	$	(32,800	)	$	(39,300	)

6

CONSOLIDATED SUMMARY INCOME STATEMENT
Quarterly, Unaudited
																	1Q08 Change vs.
(Thousands)		1Q08			4Q07			3Q07			2Q07			1Q07				4Q07		1Q07
Net interest income	$	228,092		$	225,987		$	237,804		$	239,432		$	237,419				1	%	(4	)%
Noninterest income		383,130			103,429			203,475			281,313			272,915				270	%	40	%
Securities gains/(losses), net		65,946			(10,442	)		-			(1,014	)		10,273				NM		NM
Total revenue		677,168			318,974			441,279			519,731			520,607				112	%	30	%
Noninterest expense		438,277			561,559			421,622			457,240			403,012				(22	)%	9	%
Provision		240,000			156,519			43,352			44,408			28,486				53	%	743	%
Pretax (loss)/income		(1,109	)		(399,104	)		(23,695	)		18,083			89,109				NM		NM
(Benefit)/provision for income taxes		(8,146	)		(146,342	)		(9,330	)		(3,861	)		18,802				NM		NM
Income/(loss) from continuing operations		7,037			(252,762	)		(14,365	)		21,944			70,307				NM		(90	)%
Income from discontinued operations, net of tax		883			4,137			209			179			240				(79	)%	268	%
Net income/(loss)	$	7,920		$	(248,625	)	$	(14,156	)	$	22,123		$	70,547				NM		(89	)%
Common Stock Data
Diluted EPS from continuing operations	$	.06		$	(2.00	)	$	(.11	)	$	.17		$	.55			NM			(89	)%
Diluted EPS		.06			(1.97	)		(.11	)		.17			.55			NM			(89	)%
Diluted shares		126,660			126,089			126,058			128,737			128,704				*		(2	)%
Period-end shares outstanding		126,786			126,366			126,388			126,237			125,749				*		1	%
Dividends declared per share	$	.20		$	.45		$	.45		$	.45		$	.45				(56	)%	(56	)%
Key Ratios & Other
Return on average assets		.09	%		(2.65	)%		(.15	)%		.23	%		.74	%
Return on average equity		1.47	%		(42.52	)%		(2.31	)%		3.57	%		11.61	%
Net interest margin		2.81	%		2.77	%		2.87	%		2.79	%		2.84	%
Tax rate	NM			NM			NM			NM				21.10	%
Efficiency ratio		64.72	%		176.05	%		95.55	%		87.98	%		77.41	%
FTE employees		9,555			9,941			11,052			11,903			12,018				(4	)%	(20	)%
NM - Not meaningful
* Amount is less than one percent

7

CONSOLIDATED INCOME STATEMENT
Quarterly, Unaudited
																1Q08 Change vs.
(Thousands)		1Q08			4Q07			3Q07			2Q07			1Q07			4Q07			1Q07
Interest income	$	476,443		$	545,136		$	582,735		$	594,903		$	583,185			(13	)%		(18	)%
Less interest expense		248,351			319,149			344,931			355,471			345,766			(22	)%		(28	)%
Net interest income		228,092			225,987			237,804			239,432			237,419			1	%		(4	)%
Provision for loan losses		240,000			156,519			43,352			44,408			28,486			53	%		743	%
Net interest income after
provision for loan losses		(11,908	)		69,468			194,452			195,024			208,933			(117	)%		(106	)%
Noninterest income:
Capital markets (c)		131,457			98,482			63,722			85,054			87,113			33	%		51	%
Deposit transactions
and cash management		42,553			47,971			44,863			43,079			39,358			(11	)%		8	%
Mortgage banking  (a) (c) (d) (e)		158,712			(113,965	)		39,022			71,300			73,097		NM				117	%
Trust services and investment
management		9,109			10,097			9,922			10,628			9,688			(10	)%		(6	)%
Insurance commissions		8,144			7,529			6,747			7,674			9,789			8	%		(17	)%
Revenue from loan sales and securitizations		(4,097	)		(171	)		4,774			9,615			9,663		NM			NM
Securities gains/(losses), net (b)		65,946			(10,442	)		-			(1,014	)		10,273		NM				542	%
(Losses)/gains on divestitures (a)		(995	)		15,695			-			-			-		NM			NM
Other		38,247			37,791			34,425			53,963			44,207			1	%		(13	)%
Total noninterest income		449,076			92,987			203,475			280,299			283,188			383	%		59	%
Adjusted gross income after
provision for loan losses		437,168			162,455			397,927			475,323			492,121			169	%		(11	)%
Noninterest expense:
Employee compensation,
incentives and benefits (a) (d)		287,470			226,905			236,683			258,191			246,343			27	%		17	%
Occupancy  (a)		28,591			34,209			34,778			33,402			28,784			(16	)%		(1	)%
Operations services		18,964			20,148			18,774			17,457			17,821			(6	)%		6	%
Equipment rentals, depreciation
and maintenance   (a)		15,011			16,252			17,270			21,791			17,613			(8	)%		(15	)%
Communications and courier (a) (d)		11,004			10,664			10,959			10,746			11,540			3	%		(5	)%
Amortization of intangible assets		2,440			2,864			2,647			2,623			2,825			(15	)%		(14	)%
Goodwill impairment		-			71,074			13,010			-			-		NM			NM
Other  (a) (b) (d)		74,797			179,443			87,501			113,030			78,086			(58	)%		(4	)%
Total noninterest expense		438,277			561,559			421,622			457,240			403,012			(22	)%		9	%
Pretax (loss)/income		(1,109	)		(399,104	)		(23,695	)		18,083			89,109		NM			NM
(Benefit)/provision for income taxes		(8,146	)		(146,342	)		(9,330	)		(3,861	)		18,802		NM			NM
Income/(loss) from continuing operations		7,037			(252,762	)		(14,365	)		21,944			70,307		NM				(90	)%
Income from discontinued operations,
net of tax		883			4,137			209			179			240			(79	)%		268	%
Net income/(loss)	$	7,920		$	(248,625	)	$	(14,156	)	$	22,123		$	70,547		NM				(89	)%
NM - Not meaningful
1Q08 Key Impacts
(a) Includes a portion of net charges for $21.3 million, see Restructuring, Repositioning and Efficiency Initiatives page for further details
(b) Includes gain on shares redeemed and legal settlement accrual reversal related to Visa's initial public offering
(c) Includes LOCOM and other loan sale adjustments
(d) Includes effects of electing fair value for mortgage warehouse loans
(e) Includes effect of adopting new accounting standards

8

OTHER INCOME AND OTHER EXPENSE
Quarterly, Unaudited
															1Q08 Change vs.
(Thousands)		1Q08			4Q07			3Q07			2Q07		1Q07			4Q07		1Q07
Other Income
Brokerage management fees and
commissions	$	8,413		$	8,747		$	9,189		$	10,263	$	9,631			(4	)%	(13	)%
Bank owned life insurance		6,962			6,697			6,260			6,250		5,965			4	%	17	%
Bankcard income		5,540			6,221			6,329			6,319		6,005			(11	)%	(8	)%
Other service charges		3,396			3,357			3,581			3,677		3,681			1	%	(8	)%
Remittance processing		3,273			3,450			3,171			3,330		3,500			(5	)%	(6	)%
Reinsurance fees		3,145			2,794			2,418			2,056		1,784			13	%	76	%
ATM interchange fees		2,238			2,224			2,200			2,131		1,917			1	%	17	%
Deferred compensation		(6,550	)		(1,667	)		526			7,603		1,265			NM		(618	)%
Letter of credit		1,458			1,759			1,864			1,495		1,620			(17	)%	(10	)%
Electronic banking fees		1,618			1,636			1,631			1,639		1,655			(1	)%	(2	)%
Check clearing fees		862			1,125			1,275			1,284		1,212			(23	)%	(29	)%
Federal flood certifications		1,523			1,084			1,207			1,383		1,123			40	%	36	%
Other		6,369			364			(5,226	)		6,533		4,849		NM			31	%
Total	$	38,247		$	37,791		$	34,425		$	53,963	$	44,207			1	%	(13	)%
Other Expense
Legal and professional fees (a)	$	15,022		$	17,629		$	13,532		$	14,130	$	11,591			(15	)%	30	%
Computer software   (a)		7,956			26,185			9,334			9,237		9,186			(70	)%	(13	)%
Advertising and public relations (a)		9,327			10,297			10,475			11,312		10,262			(9	)%	(9	)%
Travel and entertainment  (a)		5,027			5,829			7,065			7,391		5,814			(14	)%	(14	)%
Low income housing expense		4,566			6,605			4,483			5,082		4,752			(31	)%	(4	)%
Contract employment  (a)		5,584			5,202			5,770			5,549		5,022			7	%	11	%
Distributions on preferred stock
of subsidiary		4,061			4,679			4,761			4,701		4,658			(13	)%	(13	)%
Foreclosed real estate		6,362			8,871			1,393			3,492		2,292			(28	)%	178	%
Supplies (a)		3,020			3,496			3,382			3,430		3,601			(14	)%	(16	)%
Loan closing costs (c)		13,060			1,279			4,857			3,623		3,024			921	%	332	%
Customer relations		1,707			2,834			2,605			2,420		1,942			(40	)%	(12	)%
Other insurance and taxes		1,758			2,684			1,751			2,003		2,403			(35	)%	(27	)%
Employee training and dues		1,398			1,183			1,703			2,028		1,648			18	%	(15	)%
Fed services fees		1,611			1,463			1,540			1,599		1,445			10	%	11	%
Complimentary check expense		1,298			1,206			1,237			1,324		1,291			8	%	1	%
Loan insurance expense		1,113			1,073			1,123			1,167		1,247			4	%	(11	)%
Bank examination costs		1,053			1,142			1,141			1,091		1,130			(8	)%	(7	)%
Deposit insurance premium		2,827			1,223			615			606		883			131	%	220	%
Other  (a)(b)		(11,953	)		76,563			10,734			32,845		5,895			(116	)%	(303	)%
Total	$	74,797		$	179,443		$	87,501		$	113,030	$	78,086			(58	)%	(4	)%
* Amount is less than one percent
NM - Not meaningful
1Q08 Key Impacts
(a) Includes a portion of net charges for $9.1 million, see Restructuring, Repositioning and Efficiency Initiatives
(b) Includes amounts related to legal settlement accrual reversal related to Visa's initial public offering
(c) Includes effect of election of fair value for mortgage warehouse

9

CONSOLIDATED PERIOD-END BALANCE SHEET
Quarterly, Unaudited
																1Q08 Change vs.
(Thousands)		1Q08			4Q07			3Q07			2Q07			1Q07			4Q07			1Q07
Assets
Investment securities	$	3,034,798		$	3,032,791		$	3,076,360		$	3,374,853		$	3,310,960			*			(8	)%
Loans held for sale		3,616,018			3,461,712			2,900,464			3,330,489			2,921,629			4	%		24	%
Loans held for sale-divestiture (a)		207,672			289,878			565,492			-			-		(28		)%	NM
Loans, net of unearned income		21,932,020			22,103,516			21,973,004			22,382,303			22,268,190			(1	)%		(2	)%
Federal funds sold and securities
purchased under agreements to resell		898,615			1,089,495			1,096,624			1,121,052			1,757,365			(18	)%		(49	)%
Interest bearing deposits with other financial institutions		46,382			39,422			30,993			58,241			15,739			18	%		195	%
Trading securities		1,553,053			1,768,763			1,734,653			2,291,704			2,443,342			(12	)%		(36	)%
Total earning assets		31,288,558			31,785,577			31,377,590			32,558,642			32,717,225			(2	)%		(4	)%
Cash and due from banks		851,875			1,170,220			936,707			799,428			861,534			(27	)%		(1	)%
Capital markets receivables		1,680,057			524,419			1,219,720			1,240,456			1,144,135			220	%		47	%
Mortgage servicing rights, net		895,923			1,159,820			1,470,589			1,522,966			1,540,041			(23	)%		(42	)%
Goodwill		192,408			192,408			267,228			279,825			275,582		-				(30	)%
Other intangible assets, net		52,017			56,907			58,738			61,947			61,672			(9	)%		(16	)%
Premises and equipment, net		382,488			399,305			411,515			438,807			445,301			(4	)%		(14	)%
Real estate acquired by foreclosure		106,018			103,982			75,656			67,499			68,613			2	%		55	%
Discontinued assets		-			-			-			-			358		-			NM
Allowance for loan losses		(483,203	)		(342,341	)		(236,611	)		(229,919	)		(220,806	)		41	%		119	%
Other assets		2,293,045			1,949,308			1,874,497			1,654,433			1,935,111			18	%		18	%
Other assets-divestiture (a)		8,759			15,856			22,623			-			-		(45		)%	NM
Total assets	$	37,267,945		$	37,015,461		$	37,478,252		$	38,394,084		$	38,828,766			1	%		(4	)%
Liabilities and Shareholders' Equity
Deposits
Savings	$	4,217,215		$	3,872,684		$	3,592,732		$	3,520,757		$	3,607,674			9	%		17	%
Other interest-bearing deposits		1,986,556			1,946,933			1,674,624			1,822,076			1,941,422			2	%		2	%
Time deposits		2,648,339			2,826,301			2,822,792			2,885,307			2,876,257			(6	)%		(8	)%
Interest bearing deposits-divestiture (a)		99,370			189,051			361,368			-			-		(47		)%	NM
Total interest-bearing core deposits		8,951,480			8,834,969			8,451,516			8,228,140			8,425,353			1	%		6	%
Noninterest-bearing deposits		4,995,696			5,026,417			4,928,233			5,516,735			5,506,791			(1	)%		(9	)%
Noninterest-bearing deposits-divestiture (a)		18,197			28,750			72,404			-			-		(37		)%	NM
Total core deposits		13,965,373			13,890,136			13,452,153			13,744,875			13,932,144			1	%		*
Certificates of deposit $100,000 and more		2,222,016			3,129,532			5,142,169			8,016,808			8,559,807			(29	)%		(74	)%
Certificates of deposit $100,000 and more -divestiture (a)		1,153			12,617			41,037			-			-		(91		)%	NM
Total deposits		16,188,542			17,032,285			18,635,359			21,761,683			22,491,951			(5	)%		(28	)%
Federal funds purchased and securities
sold under agreements to repurchase		3,678,217			4,829,597			4,039,827			3,841,251			3,173,476			(24	)%		16	%
Federal funds purchased and securities
sold under agreements to repurchase - divestiture (a)		11,572			20,999			-			-			-		(45		)%	NM
Trading liabilities		531,259			556,144			543,060			658,533			678,796			(4	)%		(22	)%
Commercial paper and other short-term borrowings		4,753,582			3,422,995			2,396,316			246,815			819,768			39	%		480	%
Term borrowings		6,060,795			6,027,967			5,980,513			5,828,138			5,968,789			1	%		2	%
Other collateralized borrowings		809,273			800,450			820,040			821,966			559,226			1	%		45	%
Total long-term debt		6,870,068			6,828,417			6,800,553			6,650,104			6,528,015			1	%		5	%
Capital markets payables		1,688,870			586,358			1,053,349			1,144,029			1,088,340			188	%		55	%
Discontinued liabilities		-			-			-			-			32,608		-			NM
Other liabilities		1,136,461			1,305,868			1,253,295			1,332,910			1,205,859			(13	)%		(6	)%
Other liabilities-divestiture (a)		1,870			1,925			39,389			-			-			(3	)%	NM
Total liabilities		34,860,441			34,584,588			34,761,148			35,635,325			36,018,813			1	%		(3	)%
Preferred stock of subsidiary		295,277			295,277			295,277			295,277			295,277			-			-
Shareholders' Equity
Common stock		79,242			78,979			78,992			78,898			78,593			*			1	%
Capital surplus		362,823			361,826			360,016			352,138			341,491			*			6	%
Undivided profits		1,704,559			1,742,892			2,048,689			2,120,014			2,155,007			(2	)%		(21	)%
Accumulated other comprehensive (loss)/income, net		(34,397	)		(48,101	)		(65,870	)		(87,568	)		(60,415	)		(28	)%		(43	)%
Total shareholders' equity		2,112,227			2,135,596			2,421,827			2,463,482			2,514,676			(1	)%		(16	)%
Total liabilities and shareholders' equity	$	37,267,945		$	37,015,461		$	37,478,252		$	38,394,084		$	38,828,766			1	%		(4	)%
* Amount is less than one percent
NM - Not meaningful
(a) Associated with the sale of First Horizon Bank branches

10

CONSOLIDATED AVERAGE AND PERIOD-END LOANS
Quarterly, Unaudited
											1Q08 Change vs.
(Thousands)		1Q08		4Q07		3Q07		2Q07		1Q07		4Q07		1Q07
Average Loans (Net)
Commercial
Commercial, financial and industrial	$	7,121,890	$	6,957,498	$	7,061,103	$	7,292,380	$	7,131,102		2	%	*
Real estate commercial  (a)		1,347,377		1,301,866		1,363,363		1,260,196		1,157,711		3	%	16	%
Real estate construction  (b)		2,713,253		2,825,210		2,875,296		2,919,522		2,843,263		(4	)%	(5	)%
Total commercial loans		11,182,520		11,084,574		11,299,762		11,472,098		11,132,076		1	%	*
Retail
Real estate residential   (c)		7,774,415		7,605,345		7,601,422		7,854,784		7,908,039		2	%	(2	)%
Real estate construction  (d)		1,909,061		2,096,561		2,144,902		2,095,021		2,045,952		(9	)%	(7	)%
Other retail		141,961		144,116		149,714		149,976		153,651		(1	)%	(8	)%
Credit card receivables		195,081		201,153		194,376		194,732		195,209		(3	)%	*
Real estate loans pledged against
other collateralized borrowings   (e)		755,071		779,013		808,247		543,771		572,284		(3	)%	32	%
Total retail loans		10,775,589		10,826,188		10,898,661		10,838,284		10,875,135		*		(1	)%
Total loans, net of unearned income	$	21,958,109	$	21,910,762	$	22,198,423	$	22,310,382	$	22,007,211		*		*
Period-End Loans (Net)
Commercial
Commercial, financial and industrial	$	7,238,630	$	7,140,087	$	6,978,643	$	7,218,582	$	7,371,873		1	%	(2	)%
Real estate commercial  (a)		1,345,526		1,294,922		1,326,261		1,389,963		1,144,086		4	%	18	%
Real estate construction  (b)		2,602,968		2,753,475		2,828,545		2,830,856		2,931,183		(5	)%	(11	)%
Total commercial loans		11,187,124		11,188,484		11,133,449		11,439,401		11,447,142		*		(2	)%
Retail
Real estate residential   (c)		7,858,109		7,791,885		7,544,048		7,614,887		7,856,197		1	%	*
Real estate construction  (d)		1,814,863		2,008,289		2,160,593		2,158,775		2,073,293		(10	)%	(12	)%
Other retail		138,253		144,019		144,526		149,157		151,959		(4	)%	(9	)%
Credit card receivables		191,119		204,812		196,967		194,715		187,658		(7	)%	2	%
Real estate loans pledged against
other collateralized borrowings   (e)		742,552		766,027		793,421		825,368		551,941		(3	)%	35	%
Total retail loans		10,744,896		10,915,032		10,839,555		10,942,902		10,821,048		(2	)%	(1	)%
Total loans, net of unearned income	$	21,932,020	$	22,103,516	$	21,973,004	$	22,382,303	$	22,268,190		(1	)%	(2	)%
* Amount is less than one percent
(a) Includes nonconstruction income property loans
(b) Includes home builder, condominium, and income property construction loans
(c) Includes home equity loans and lines of credit
(d) Includes one-time close product
(e) Includes on balance sheet securitizations of home equity loans

11

CONSOLIDATED AVERAGE BALANCE SHEET
Quarterly, Unaudited
																1Q08 Change vs.
(Thousands)		1Q08			4Q07			3Q07			2Q07			1Q07			4Q07			1Q07
Assets:
Earning assets:
Loans, net of unearned income*	$	21,958,109		$	21,910,762		$	22,198,423		$	22,310,382		$	22,007,211			**			**
Loans held for sale		3,728,008			3,337,237			3,963,650			4,087,446			3,646,252			12	%		2	%
Loans held for sale-divestiture (a)		248,751			467,424			-			-			-			(47	)%	NM
Investment securities:
U.S. Treasuries		43,305			36,062			151,831			156,865			50,899			20	%		(15	)%
U.S. government agencies		2,725,948			2,787,078			2,836,619			3,005,463			3,513,737			(2	)%		(22	)%
States and municipalities		12,847			1,740			1,750			1,769			1,769			638	%		626	%
Other		232,472			230,808			237,291			232,850			284,625			1	%		(18	)%
Total investment securities		3,014,572			3,055,688			3,227,491			3,396,947			3,851,030			(1	)%		(22	)%
Capital markets securities inventory		1,961,964			1,934,055			1,810,703			2,546,668			2,409,211			1	%		(19	)%
Mortgage banking trading securities		405,579			527,453			545,201			528,457			331,800			(23	)%		22	%
Other earning assets:
Federal funds sold and securities
purchased under agreements to resell		1,304,707			1,237,957			1,224,193			1,442,951			1,519,375			5	%		(14	)%
Interest bearing deposits with other financial institutions		46,093			28,968			41,118			32,310			19,666			59	%		134	%
Total other earning assets		1,350,800			1,266,925			1,265,311			1,475,261			1,539,041			7	%		(12	)%
Total earning assets		32,667,783			32,499,544			33,010,779			34,345,161			33,784,545			1	%		(3	)%
Allowance for loan losses		(359,600	)		(246,916	)		(236,188	)		(229,157	)		(223,932	)		46	%		61	%
Cash and due from banks		786,693			846,793			788,636			804,816			845,987			(7	)%		(7	)%
Capital markets receivables		297,908			182,358			141,519			165,433			137,536			63	%		117	%
Premises and equipment, net		390,291			407,212			435,480			443,428			449,283			(4	)%		(13	)%
Other assets		3,367,729			3,540,575			3,613,812			3,540,463			3,653,625			(5	)%		(8	)%
Other assets - divestiture (a)		11,581			20,868			-			-			-			(45	)%	NM
Total assets	$	37,162,385		$	37,250,434		$	37,754,038		$	39,070,144		$	38,647,044			**			(4	)%
Liabilities and shareholders' equity:
Interest-bearing liabilities:
Interest-bearing deposits:
Interest bearing deposits - divestiture (a)	$	127,352		$	292,615		$	-		$	-		$	-			(56	)%	NM
Other interest-bearing deposits		1,922,506			1,685,749			1,777,982			1,892,479			1,927,573			14	%		**
Savings		4,134,308			3,749,222			3,475,981			3,538,198			3,413,592			10	%		21	%
Time deposits		2,763,335			2,850,719			2,913,872			2,874,932			2,893,963			(3	)%		(5	)%
Total interest-bearing core deposits		8,947,501			8,578,305			8,167,835			8,305,609			8,235,128			4	%		9	%
Certificates of deposit $100,000 and more		2,696,781			4,464,070			6,802,371			8,271,191			8,040,937			(40	)%		(66	)%
Certificates of deposit $100,000 and more - divestiture (a)		4,770			30,499			-			-			-			(84	)%	NM
Federal funds purchased and securities
sold under agreements to repurchase		5,236,736			4,936,968			4,964,072			4,967,888			4,505,777			6	%		16	%
Federal funds purchased and securities
sold under agreements to repurchase - divestiture (a)		16,171			33,370			-			-			-			(52	)%	NM
Capital markets trading liabilities		846,369			812,969			773,576			1,054,718			1,166,790			4	%		(27	)%
Commercial paper and other short-term
borrowings		3,850,704			2,651,882			1,165,801			560,721			987,898			45	%		290	%
Long term debt:
Term borrowings		6,013,433			5,981,215			5,837,370			5,887,063			5,807,925			1	%		4	%
Other collateralized borrowings		790,811			813,075			807,143			550,604			581,030			(3	)%		36	%
Total long-term debt		6,804,244			6,794,290			6,644,513			6,437,667			6,388,955			**			7	%
Total interest-bearing liabilities		28,403,276			28,302,353			28,518,168			29,597,794			29,325,485			**			(3	)%
Noninterest-bearing deposits		4,743,479			4,838,363			5,096,766			5,304,752			5,104,695			(2	)%		(7	)%
Other noninterest-bearing deposits-divestiture (a)		21,327			54,928			-			-			-			(61	)%	NM
Capital markets payables		292,846			173,351			139,170			182,960			222,607			69	%		32	%
Other liabilities		1,234,695			1,262,345			1,276,262			1,206,237			1,235,077			(2	)%		**
Other liabilities-divestiture (a)		2,335			3,885			-			-			-			(40	)%	NM
Preferred stock of subsidiary		295,277			295,277			295,277			295,277			295,277			-			-
Shareholders' equity		2,169,150			2,319,932			2,428,395			2,483,124			2,463,903			(6	)%		(12	)%
Total liabilities and shareholders' equity	$	37,162,385		$	37,250,434		$	37,754,038		$	39,070,144		$	38,647,044			**			(4	)%
* Includes loans on nonaccrual status
** Amount is less than one percent
(a) Associated with the sale of First Horizon Bank branches

12

CONSOLIDATED AVERAGE BALANCE SHEET: INCOME & EXPENSE
Quarterly, Unaudited
																1Q08 Change vs.
(Thousands)		1Q08			4Q07			3Q07			2Q07			1Q07			4Q07			1Q07
Assets:
Earning assets:
Loans, net of unearned income*	$	331,803		$	385,027		$	413,376		$	413,340		$	410,512			(14	)%		(19	)%
Loans held for sale		58,438			62,249			66,570			65,923			58,845			(6	)%		(1	)%
Investment securities:
U.S. Treasuries		340			434			1,856			1,853			636			(22	)%		(47	)%
U.S. government agencies		37,954			39,027			40,293			42,474			50,221			(3	)%		(24	)%
States and municipalities		220			4			4			4			4		NM			NM
Other		2,290			2,904			2,838			2,776			3,514			(21	)%		(35	)%
Total investment securities		40,804			42,369			44,991			47,107			54,375			(4	)%		(25	)%
Capital markets securities inventory		22,652			25,261			25,321			34,087			30,297			(10	)%		(25	)%
Mortgage banking trading securities		13,363			16,436			16,647			16,029			10,317			(19	)%		30	%
Other earning assets:
Federal funds sold and securities
purchased under agreements to resell		9,341			13,485			15,297			18,142			18,821			(31	)%		(50	)%
Interest bearing deposits with other financial institutions		357			450			705			410			260			(21	)%		37	%
Total other earning assets		9,698			13,935			16,002			18,552			19,081			(30	)%		(49	)%
Total earning assets/interest income	$	476,758		$	545,277		$	582,907		$	595,038		$	583,427			(13	)%		(18	)%
Allowance for loan losses
Cash and due from banks
Capital markets receivables
Premises and equipment, net
Other assets
Total assets
Liabilities and shareholders' equity:
Interest-bearing liabilities:
Interest-bearing deposits:
Other interest-bearing deposits	$	5,906		$	5,976		$	6,179		$	6,808		$	6,889			(1	)%		(14	)%
Savings		25,888			30,864			29,140			29,919			26,031			(16	)%		(1	)%
Time deposits		31,502			35,234			34,745			33,555			33,037			(11	)%		(5	)%
Total interest-bearing core deposits		63,296			72,074			70,064			70,282			65,957			(12	)%		(4	)%
Certificates of deposit $100,000 and more		31,069			59,851			92,556			110,630			106,276			(48	)%		(71	)%
Federal funds purchased and securities
sold under agreements to repurchase		38,521			52,635			60,287			61,745			54,379			(27	)%		(29	)%
Capital markets trading liabilities		9,615			10,588			10,295			14,272			16,361			(9	)%		(41	)%
Commercial paper and other short-term
borrowings		31,527			30,229			14,827			7,187			12,785			4	%		147	%
Long term debt:
Term borrowings		66,303			82,870			85,241			83,529			81,834			(20	)%		(19	)%
Other collateralized borrowings		8,020			10,902			11,661			7,826			8,174			(26	)%		(2	)%
Total long-term debt		74,323			93,772			96,902			91,355			90,008			(21	)%		(17	)%
Total interest-bearing liabilities/interest expense	$	248,351		$	319,149		$	344,931		$	355,471		$	345,766			(22	)%		(28	)%
Noninterest-bearing deposits
Capital markets payables
Other liabilities
Preferred stock of subsidiary
Shareholders' equity
Total liabilities and shareholders' equity
Net interest income-tax equivalent basis	$	228,407		$	226,128		$	237,976		$	239,567		$	237,661			1	%		(4	)%
Fully taxable equivalent adjustment		(315	)		(141	)		(172	)		(135	)		(242	)		123	%		30	%
Net interest income	$	228,092		$	225,987		$	237,804		$	239,432		$	237,419			1	%		(4	)%
* Includes loans on nonaccrual status
Income amounts are adjusted to a fully taxable equivalent. Earning assets income is expressed net of unearned income
NM - Not meaningful

13

CONSOLIDATED AVERAGE BALANCE SHEET: YIELDS & RATES
Quarterly, Unaudited
(Thousands)	1Q08		4Q07		3Q07		2Q07		1Q07
Assets:
Earning assets:
Loans, net of unearned income*	6.07	%	6.98	%	7.39	%	7.43	%	7.56	%
Loans held for sale	5.88		6.54		6.72		6.45		6.46
Investment securities:
U.S. Treasuries	3.15		4.77		4.85		4.74		5.06
U.S. government agencies	5.57		5.60		5.68		5.65		5.72
States and municipalities	6.87		.82		.83		.98		.97
Other	3.94		5.03		4.78		4.77		4.94
Total investment securities	5.41		5.55		5.57		5.55		5.65
Capital markets securities inventory	4.62		5.22		5.59		5.35		5.03
Mortgage banking trading securities	13.18		12.46		12.21		12.13		12.44
Other earning assets:
Federal funds sold and securities
purchased under agreements to resell	2.88		4.32		4.96		5.04		5.02
Interest bearing deposits with other financial institutions	3.11		6.17		6.80		5.10		5.35
Total other earning assets	2.89		4.36		5.02		5.04		5.03
Total earning assets/interest income	5.86	%	6.67	%	7.02	%	6.94	%	6.97	%
Allowance for loan losses
Cash and due from banks
Capital markets receivables
Premises and equipment, net
Other assets
Total assets
Liabilities and shareholders' equity:
Interest-bearing liabilities:
Interest-bearing deposits:
Other interest-bearing deposits	1.19	%	1.33	%	1.38	%	1.44	%	1.45	%
Savings	2.50		3.19		3.33		3.39		3.09
Time deposits	4.55		4.73		4.73		4.68		4.63
Total interest-bearing core deposits	2.85		3.33		3.40		3.39		3.25
Certificates of deposit $100,000 and more	4.63		5.28		5.40		5.36		5.36
Federal funds purchased and securities
sold under agreements to repurchase	2.95		4.20		4.82		4.99		4.89
Capital markets trading liabilities	4.57		5.17		5.28		5.43		5.69
Commercial paper and other short-term
borrowings	3.29		4.52		5.05		5.14		5.25
Long term debt:
Term borrowings	4.41		5.55		5.85		5.68		5.64
Other collateralized borrowings	4.06		5.36		5.78		5.69		5.63
Total long-term debt	4.37		5.52		5.84		5.68		5.64
Total interest-bearing liabilities/interest expense	3.51	%	4.49	%	4.81	%	4.81	%	4.77	%
Noninterest-bearing deposits
Capital markets payables
Other liabilities
Other liabilities - divestiture
Preferred stock of subsidiary
Shareholders' equity
Total liabilities and shareholders' equity
Net interest spread	2.35	%	2.18	%	2.21	%	2.13	%	2.20	%
Effect of interest-free sources used to fund
earning assets	.46		.59		.66		.66		.64
Net interest margin	2.81	%	2.77	%	2.87	%	2.79	%	2.84	%
* Includes loans on nonaccrual status
Yields are adjusted to a fully taxable equivalent. Earning assets yields are expressed net of unearned income.
Rates are expressed net of unamortized debenture cost for long-term debt. Net interest margin is computed using total net interest income.
Certain previously reported amounts have been reclassified to agree with current presentation.

14

MORTGAGE SERVICING RIGHTS
Quarterly, Unaudited
																	1Q08 Change vs.
(Thousands)		1Q08			4Q07			3Q07			2Q07			1Q07				4Q07		1Q07
First Liens
Fair value beginning balance	$	1,122,415		$	1,429,245		$	1,481,727		$	1,500,337		$	1,495,215				(21	)%	(25	)%
Addition of mortgage servicing rights		78,871			67,300			97,084			100,550			84,707
Reductions due to loan payments		(37,448	)		(40,930	)		(48,964	)		(62,661	)		(61,698	)
Reductions due to sale		(43,842	)		(96,502	)		-			-			-
Changes in fair value due to:
Changes in valuation model inputs
or assumptions (a)		(254,076	)		(236,695	)		(100,602	)		118,048			(17,833	)
Reclassification to trading assets		-			-			-			(174,547	)		-
Other changes in fair value		(65	)		(3	)		-			-			(54	)
Fair value ending balance	$	865,855		$	1,122,415		$	1,429,245		$	1,481,727		$	1,500,337				(23	)%	(42	)%
Second Liens
Fair value beginning balance	$	25,832		$	28,747		$	27,608		$	25,710		$	24,091				(10	)%	7	%
Addition of mortgage servicing rights		-			-			3,587			3,997			3,998
Reductions due to loan payments		(2,617	)		(2,097	)		(2,559	)		(2,169	)		(2,378	)
Changes in fair value due to:
Changes in valuation model inputs
or assumptions (a)		(3,089	)		(834	)		32			67			(1	)
Other changes in fair value		-			16			79			3			-
Fair value ending balance	$	20,126		$	25,832		$	28,747		$	27,608		$	25,710				(22	)%	(22	)%
HELOC
Fair value beginning balance	$	11,573		$	12,597		$	13,631		$	13,994		$	14,636				(8	)%	(21	)%
Addition of mortgage servicing rights		887			174			87			791			1,041
Reductions due to loan payments		(707	)		(736	)		(1,124	)		(1,154	)		(1,683	)
Changes in fair value due to:
Changes in valuation model inputs
or assumptions (a)		(1,935	)		(462	)		(39	)		-			-
Other changes in fair value		124			-			42			-			-
Fair value ending balance	$	9,942		$	11,573		$	12,597		$	13,631		$	13,994				(14	)%	(29	)%
Total Consolidated
Fair value beginning balance	$	1,159,820		$	1,470,589		$	1,522,966		$	1,540,041		$	1,533,942				(21	)%	(24	)%
Addition of mortgage servicing rights		79,758			67,474			100,758			105,338			89,746
Reductions due to loan payments		(40,772	)		(43,763	)		(52,647	)		(65,984	)		(65,759	)
Reductions due to sale		(43,842	)		(96,502	)		-			-			-
Changes in fair value due to:
Changes in valuation model inputs
or assumptions (a)		(259,100	)		(237,991	)		(100,609	)		118,115			(17,834	)
Reclassification to trading assets		-			-			-			(174,547	)		-
Other changes in fair value		59			13			121			3			(54	)
Fair value ending balance	$	895,923		$	1,159,820		$	1,470,589		$	1,522,966		$	1,540,041				(23	)%	(42	)%
(a) Principally reflects changes in discount rates and prepayment speed assumptions, mostly due to changes in interest rates

15

BUSINESS SEGMENT HIGHLIGHTS
Quarterly, Unaudited
																	1Q08 Change vs.
(Thousands)		1Q08			4Q07			3Q07			2Q07			1Q07				4Q07			1Q07
Regional Banking
Total revenues(a)	$	207,628		$	229,118		$	228,572		$	229,301		$	227,556				(9	)%		(9	)%
Provision for loan losses		75,264			15,831			18,523			14,071			14,204				375	%		430	%
Noninterest expenses		150,520			159,880			153,814			161,336			156,319				(6	)%		(4	)%
Pre-tax (loss)/income		(18,156	)		53,407			56,235			53,894			57,033			NM			NM
(Benefit)/provision for income taxes		(13,542	)		27,024			19,797			11,826			14,620			NM			NM
Net (loss)/income from continuing operations		(4,614	)		26,383			36,438			42,068			42,413			NM			NM
Income from discontinued operations, net of tax		883			4,137			209			179			240				(79	)%		268	%
Net (loss)/income	$	(3,731	)	$	30,520		$	36,647		$	42,247		$	42,653			NM			NM
Capital Markets
Total revenues(a)	$	153,579		$	119,191		$	78,622		$	106,690		$	102,037				29	%		51	%
Provision for loan losses		15,031			1,244			2,018			3,673			1,162			NM			NM
Noninterest expenses		115,728			87,042			73,921			80,480			86,619				33	%		34	%
Pre-tax income		22,820			30,905			2,683			22,537			14,256				(26	)%		60	%
Provision for income taxes		8,437			11,572			900			8,411			5,287				(27	)%		60	%
Net income	$	14,383		$	19,333		$	1,783		$	14,126		$	8,969				(26	)%		60	%
National Specialty Lending
Total revenues(a)	$	54,494		$	54,328		$	62,419		$	71,886		$	76,555				*			(29	)%
Provision for loan losses		149,483			139,398			22,807			19,104			13,127				7	%	NM
Noninterest expenses		25,149			31,069			33,624			38,212			35,179				(19	)%		(29	)%
Pre-tax (loss)/income		(120,138	)		(116,139	)		5,988			14,570			28,249			NM			NM
(Benefit)/provision for income taxes		(46,589	)		(43,857	)		1,811			5,987			9,882			NM			NM
Net (loss)/income	$	(73,549	)	$	(72,282	)	$	4,177		$	8,583		$	18,367			NM			NM
Mortgage Lending
Total revenues(a)	$	199,026		$	(79,826	)	$	69,059		$	103,327		$	97,305			NM				105	%
Provision for loan losses		222			46			4			(112	)		(7	)			383	%	NM
Noninterest expenses		147,543			174,203			108,303			115,461			105,240				(15	)%		40	%
Pre-tax income/(loss)		51,261			(254,075	)		(39,248	)		(12,022	)		(7,928	)		NM			NM
Provision/(benefit) for income taxes		18,513			(99,185	)		(13,984	)		(6,854	)		(10,433	)		NM			NM
Net income/(loss)	$	32,748		$	(154,890	)	$	(25,264	)	$	(5,168	)	$	2,505			NM			NM
Corporate
Total revenues(a)	$	62,441		$	(3,837	)	$	2,607		$	8,527		$	17,154			NM				264	%
Provision for loan losses		-			-			-			7,672			-			NM			NM
Noninterest expenses		(663	)		109,365			51,960			61,751			19,655			NM			NM
Pre-tax income/(loss)		63,104			(113,202	)		(49,353	)		(60,896	)		(2,501	)		NM			NM
Provision/(benefit) for income taxes		25,035			(41,896	)		(17,854	)		(23,231	)		(554	)		NM			NM
Net income/(loss)	$	38,069		$	(71,306	)	$	(31,499	)	$	(37,665	)	$	(1,947	)		NM			NM
Total Consolidated
Total revenues(a)	$	677,168		$	318,974		$	441,279		$	519,731		$	520,607				112	%		30	%
Provision for loan losses		240,000			156,519			43,352			44,408			28,486				53	%		743	%
Noninterest expenses		438,277			561,559			421,622			457,240			403,012				(22	)%		9	%
Pre-tax (loss)/income		(1,109	)		(399,104	)		(23,695	)		18,083			89,109			NM			NM
(Benefit)/provision for income taxes		(8,146	)		(146,342	)		(9,330	)		(3,861	)		18,802			NM			NM
Net income/(loss) from continuing operations		7,037			(252,762	)		(14,365	)		21,944			70,307			NM				(90	)%
Income from discontinued operations, net of tax		883			4,137			209			179			240				(79	)%		268	%
Net income/(loss)	$	7,920		$	(248,625	)	$	(14,156	)	$	22,123		$	70,547			NM				(89	)%

Certain previously reported amounts have been reclassified to agree with current presentation.

(a) Includes noninterest income and net interest income/(expense)

NM - Not meaningful

* Amount is less than one percent

16

REGIONAL BANKING
Quarterly, Unaudited
																	1Q08 Change vs.
(Thousands)		1Q08			4Q07			3Q07			2Q07			1Q07				4Q07			1Q07
Income Statement
Net interest income	$	120,560		$	133,608		$	136,929		$	137,672		$	138,927				(10	)%		(13	)%
Noninterest income		87,068			95,509			91,644			91,629			88,629				(9	)%		(2	)%
Securities gains/(losses), net		-			1			(1	)		-			-			NM			NM
Total revenue		207,628			229,118		$	228,572			229,301			227,556				(9	)%		(9	)%
Total noninterest expense		150,520			159,880			153,814			161,336			156,319				(6	)%		(4	)%
Provision		75,264			15,831			18,523			14,071			14,204				375	%		430	%
Pretax (loss)/income	$	(18,156	)	$	53,407		$	56,235		$	53,894		$	57,033				(134	)%		(132	)%
Efficiency ratio		72.50	%		69.78	%		67.29	%		70.36	%		68.69	%
Balance Sheet
Average loans (millions)	$	10,705		$	10,667		$	11,162		$	11,162		$	11,022				*			(3	)%
Other earning assets (millions)		339			525			35			23			62				(35	)%		447	%
Total earning assets (millions)		11,044			11,192			11,197			11,185			11,084				(1	)%		*
Core deposits (millions)		10,057			9,852			10,150			10,215			10,305				2	%		(2	)%
Other deposits (millions)		1,160			1,368			1,368			1,265			1,145				(15	)%		1	%
Deposits - divestiture (millions)		153			378			-			-			-				(60	)%	NM
Total deposits (millions)	$	11,370		$	11,598		$	11,518		$	11,480		$	11,450				(2	)%		(1	)%
Net interest margin		4.39	%		4.74	%		4.85	%		4.94	%		5.08	%
Noninterest Income Detail
Deposit transactions & cash mgmt	$	41,227		$	46,647		$	43,630		$	41,901		$	38,438				(12	)%		7	%
Insurance commissions		7,854			7,485			6,507			7,890			9,357				5	%		(16	)%
Trust services & investment mgmt		9,147			10,137			9,972			10,671			9,733				(10	)%		(6	)%
Bankcard Income		4,491			5,035			5,065			5,027			4,774				(11	)%		(6	)%
Other service charges		4,037			4,152			4,185			4,724			4,672				(3	)%		(14	)%
Miscellaneous revenue		20,312			22,053			22,285			21,416			21,655				(8	)%		(6	)%
Total noninterest income	$	87,068		$	95,509		$	91,644		$	91,629		$	88,629				(9	)%		(2	)%
Key Statistics
Locations
Full-Service Financial Centers		206			216			233			233			231				(5	)%		(11	)%
First Tennessee		197			197			199			199			199				-			(1	)%
First Horizon Bank		9			19			34			34			32				(53	)%		(72	)%
Trust Assets
Total assets (millions)	$	11,681		$	12,300		$	12,954		$	12,954		$	12,878				(5	)%		(9	)%
Total managed assets (millions)		5,641			5,880			6,645			6,811			6,700				(4	)%		(16	)%
NM - Not meaningful
* Amount is less than one percent.
Certain previously reported amounts have been reclassified to agree with current presentation.

17

CAPITAL MARKETS
Quarterly, Unaudited
																	1Q08 Change vs.
(Thousands)		1Q08			4Q07			3Q07			2Q07			1Q07				4Q07			1Q07
Income Statement
Net interest income
Correspondent Banking	$	12,808		$	11,437		$	12,483		$	13,776		$	12,799				12	%		*
Capital Markets		6,841			4,389			1,655			(83	)		(2,070	)			56	%	NM
Total net interest income		19,649			15,826			14,138			13,693			10,729				24	%		83	%
Noninterest income:
Fixed income		152,208			77,126			46,003			48,258			46,313				97	%		229	%
Other		(18,278	)		26,239			18,481			44,739			44,995				(170	)%		(141	)%
Total noninterest income		133,930			103,365			64,484			92,997			91,308				30	%		47	%
Total revenue		153,579			119,191			78,622			106,690			102,037				29	%		51	%
Noninterest expense		115,728			87,042			73,921			80,480			86,619				33	%		34	%
Provision		15,031			1,244			2,018			3,673			1,162			NM			NM
Pretax income	$	22,820		$	30,905		$	2,683		$	22,537		$	14,256				(26	)%		60	%
Efficiency ratio		75.35	%		73.03	%		94.02	%		75.43	%		84.89	%
Balance Sheet
Trading inventory (millions)	$	1,962		$	1,934		$	1,810		$	2,546		$	2,409				1	%		(19	)%
Loans (millions)		1,465			1,402			1,291			1,418			1,302				4	%		13	%
Other earning assets (millions)		1,728			1,708			1,532			1,685			1,820				1	%		(5	)%
Total earning assets (millions)	$	5,155		$	5,044		$	4,633		$	5,649		$	5,531				2	%		(7	)%
Net interest margin:
Correspondent Banking		3.28	%		3.01	%		3.17	%		3.33	%		3.48	%			9	%		(6	)%
Capital Markets		.77	%		.49	%		.21	%		(.01	)%		(.21	)%			57	%	NM
Total Capital Markets		1.53	%		1.24	%		1.21	%		.97	%		.79	%			23	%		95	%
NM - Not meaningful
* Amount is less than one percent.
Certain previously reported amounts have been reclassified to agree with current presentation.

18

NATIONAL SPECIALTY LENDING
Quarterly, Unaudited
																	1Q08 Change vs.
(Thousands)		1Q08			4Q07			3Q07			2Q07			1Q07				4Q07			1Q07
Income Statement
Net interest income	$	53,840		$	58,703		$	61,224		$	59,438		$	64,556				(8	)%		(17	)%
Noninterest income		654			(4,375	)		1,195			12,448			11,999				(115	)%		(95	)%
Total revenue		54,494			54,328			62,419			71,886			76,555				*			(29	)%
Total noninterest expense		25,149			31,069			33,624			38,212			35,179				(19	)%		(29	)%
Provision		149,483			139,398			22,807			19,104			13,127				7	%	NM
Pretax (loss)/income	$	(120,138	)	$	(116,139	)	$	5,988		$	14,570		$	28,249				3	%		(525	)%
Efficiency ratio		46.15	%		57.19	%		53.87	%		53.16	%		45.95	%

Balance Sheet
Homebuilder Finance	$	411		$	379		$	357		$	348		$	309		8	%	33	%
Income Property		1,423			1,472			1,483			1,530			1,523		(3	)%	(7	)%
One-Time Close Product		1,909			2,097			2,145			2,095			2,046		(9	)%	(7	)%
HELOC and Other Installment Loans		5,613			5,502			5,360			5,351			5,390		2	%	4	%
Average loans (millions)		9,356			9,450			9,345			9,324			9,268		(1	)%	1	%
Other earning assets (millions)		22			175			355			319			307		(87	)%	(93	)%
Total earning assets (millions)		9,378			9,625			9,700			9,643			9,575		(3	)%	(2	)%
Total deposits (millions)		294			356			426			426			411		(17	)%	(28	)%
Net interest margin		2.31	%		2.42	%		2.50	%		2.47	%		2.73	%	(5	)%	(16	)%

NM - Not meaningful

* Amount is less than one percent.

Certain previously reported amounts have been reclassified to agree with current presentation.

19

MORTGAGE BANKING
Quarterly, Unaudited
																	1Q08 Change vs.
(Thousands)		1Q08			4Q07			3Q07			2Q07			1Q07				4Q07			1Q07
Income Statement
Net interest income	$	31,012		$	22,852		$	26,939		$	28,382		$	20,596				36	%		51	%
Noninterest income
Net origination fees (a)		84,056			5,008			(17,494	)		67,281			63,642			NM				32	%
Net servicing fees		69,343			(118,107	)		49,738			(3,496	)		3,008				(159	)%	NM
Other fees		14,615			10,421			9,876			11,160			10,059				40	%		45	%
Total noninterest income		168,014			(102,678	)		42,120			74,945			76,709				(264	)%		119	%
Total revenue		199,026			(79,826	)		69,059			103,327			97,305				(349	)%		105	%
Noninterest expense (b)		147,543			174,203			108,303			115,461			105,240				(15	)%		40	%
Provision		222			46			4			(112	)		(7	)			383	%	NM
Pretax (loss)/income	$	51,261		$	(254,075	)	$	(39,248	)	$	(12,022	)	$	(7,928	)			(120	)%		(747	)%
Efficiency ratio		74.13	%		(218.23	)%		156.83	%		111.74	%		108.15	%
Balance Sheet
Warehouse (millions)	$	3,230		$	2,672		$	3,311		$	3,531		$	3,030				21	%		7	%
Other earning assets (millions)		860			981			1,007			995			796				(12	)%		8	%
Total earning assets (millions)	$	4,090		$	3,653		$	4,318		$	4,526		$	3,826				12	%		7	%
Escrow balances (millions)	$	1,691		$	1,709		$	1,894		$	2,032		$	1,858				(1	)%		(9	)%
Net interest margin		3.05	%		2.48	%		2.48	%		2.52	%		2.18	%
Warehouse Spread		2.63	%		1.54	%		1.34	%		1.14	%		1.12	%
Noninterest Expense Detail
Commissions & incentives (a)	$	45,956		$	39,359		$	45,112		$	50,660		$	44,984
FAS 91 cost deferral (a)		764			(3,878	)		6,392			(3,832	)		(1,816	)
Other salaries & benefits		35,700			38,727			49,147			55,408			51,882
Total salaries & benefits		82,420			74,208			100,651			102,236			95,050				11	%		(13	)%
Contract labor & outsourcing		2,781			1,968			2,941			2,468			2,574
Equipment & occupancy		14,895			14,814			17,177			16,639			17,221
Foreclosure provision		2,395			4,872			(241	)		2,225			1,611
Other expenses (a)		45,115			120,155			44,327			50,603			40,714
Total expenses before FAS 91 reclass		147,606			216,017			164,855			174,171			157,170				(32	)%		(6	)%
FAS 91 reclassification (a)(c)		(3,962	)		(46,133	)		(61,505	)		(62,996	)		(56,343	)
Total noninterest expense before
segment allocations		143,644			169,884			103,350			111,175			100,827
Segment allocations		3,899			4,319			4,953			4,286			4,413
Total noninterest expense	$	147,543		$	174,203		$	108,303		$	115,461		$	105,240				(15	)%		40	%
NM - Not meaningful
* Amount is less than one percent.
(a) 1Q08 includes effect of adopting accounting standards, including fair value election for warehouse loans
(b) 4Q07 includes $71.1 million of goodwill impairment
(c) See Glossary of Terms
Certain previously reported amounts have been reclassified to agree with current presentation.

20

MORTGAGE BANKING: ORIGINATION INCOME
Quarterly, Unaudited
																1Q08 Change vs.
(Thousands)		1Q08			4Q07			3Q07			2Q07			1Q07			4Q07		1Q07
Origination Income
Origination fees	$	54,636		$	47,789		$	56,042		$	68,609		$	58,755
FAS 91 fee deferral (a)		-			(4,818	)		5,563			(2,436	)		(1,016	)
Appraisal, final inspection,
credit report fees		5,953			5,387			6,864			7,860			6,544
Total origination fees		60,589			48,358			68,469			74,033			64,283			25	%	(6	)%
Secondary marketing income
Prime
OMSR, SRP		77,899			66,443			96,527			98,072			76,821
Marketing G/L (Trading Gains)		(33,243	)		(17,247	)		(57,655	)		13,435			17,728
Concessions		(41,146	)		(26,174	)		(49,551	)		(45,609	)		(34,350	)
LOCOM		(16,582	)		(17,631	)		(11,530	)		(6,880	)		(2,519	)
Subtotal Prime		(13,072	)		5,391			(22,209	)		59,018			57,680			(342	)%	(123	)%
Non-Prime
OMSR, SRP		(8	)		14			87			(710	)		331
LOCOM		(433	)		(1,178	)		(2,976	)		(1,604	)		(553	)
Recourse Provision (b)		(1,474	)		(1,444	)		640			(460	)		(1,757	)
Subtotal Non-Prime		(1,915	)		(2,608	)		(2,249	)		(2,774	)		(1,979	)		(27	)%	(3	)%
Total Secondary Marketing income		(14,987	)		2,783			(24,458	)		56,244			55,701			(639	)%	(127	)%
FAS 91 Reclassification (a)		(3,962	)		(46,133	)		(61,505	)		(62,996	)		(56,343	)		(91	)%	(93	)%
Accounting Standards Adoption (c)		42,416			-			-			-			-
Total Origination Income	$	84,056		$	5,008		$	(17,494	)	$	67,281		$	63,641		NM			32	%
Margins
Marketing margin on deliveries (bps):
OMSR, SRP		105			121			131			132			127
Marketing G/L (Trading Gains)		(45	)		(31	)		(78	)		18			29
Concessions		(56	)		(48	)		(67	)		(62	)		(57	)
LOCOM		(23	)		(34	)		(20	)		(12	)		(5	)
Recourse Provision (b)		(1	)		(3	)		1			-			(2	)
Total Marketing Margin on Deliveries		(20	)		5			(33	)		76			92

NM - Not meaningful

(a) 1Q08 decrease due to effects of fair value election for warehouse loans.

(b) Represents the reclassification from expense to secondary marketing income of expected loss provisions related to the recourse obligation on sales of non-prime loans.

(c) Net effect of adopting SFAS 157, SFAS 159, and SAB 109 in 1Q08.

21

MORTGAGE BANKING: ORIGINATION METRICS
Quarterly, Unaudited
																	1Q08 Change vs.
($ in millions)		1Q08			4Q07			3Q07			2Q07			1Q07				4Q07		1Q07
Production
First lien production	$	7,510		$	6,308		$	6,672		$	8,092		$	6,302				19	%	19	%
Breakdown by Product Type
Prime
Conventional Fixed		65	%		63	%		58	%		56	%		53	%
Conventional ARM		7	%		3	%		5	%		3	%		3	%
Jumbo Fixed		2	%		6	%		7	%		9	%		9	%
Jumbo ARM		2	%		3	%		6	%		8	%		6	%
Alt A		2	%		6	%		12	%		14	%		20	%
Government		21	%		17	%		9	%		7	%		7	%
Non Prime		-			-			-			1	%		2	%
Other		1	%		2	%		3	%		2	%		-
Breakdown by Payment Type
Fully amortizing		92	%		89	%		78	%		71	%		70	%
Interest only - fixed		3	%		7	%		13	%		18	%		20	%
Interest only - ARM		5	%		4	%		9	%		11	%		10	%
Option ARM's		-			-			-			-			-
Production Refinanced %		64	%		47	%		31	%		38	%		45	%
Production Purchased %		36	%		53	%		69	%		62	%		55	%
ARMs % (Excluding Gov't ARMS)		9	%		6	%		13	%		15	%		14	%
Sales Force
Total Sales Force		1,565			1,696			2,124			2,508			2,486
Warehouse/Pipeline
Ending Warehouse Balance	$	3,130		$	2,971		$	2,083		$	2,950		$	2,527				5	%	24	%
Ending Pipeline Balance (Locked)		5,293			3,363			4,088			4,288			4,019				57	%	32	%
Loan Sales (Deliveries)
Prime		7,410			5,504			7,398			7,302			5,919				35	%	25	%
Non-Prime		-			-			1			55			134			NM			(100	)%
Total Loan Sales	$	7,410		$	5,504		$	7,399		$	7,357		$	6,053				35	%	22	%
Definitions:
Prime: Mortgages made to borrowers who typically have good credit history, full documentation, and standard structures;
"A" market conventional loans have limited credit and other risks.
Alt-A & GSE Expanded Approval: Resembles prime mortgages but lack full documentation or have non-standard structures.
They have more potential risks than prime, but less than non-prime mortgages.
Non-Prime: Mortgage loans made to borrowers who typically have derogatory information in their credit history;
non-prime loans are also made to borrowers w/ acceptable credit history but have other non-standard loan features.
Government: FHA/VA loans that are eligible for GNMA securitizations and government guarantees.
NM - Not meaningful
* Amount is less than one percent.

22

MORTGAGE BANKING: SERVICING
Quarterly, Unaudited
																	1Q08 Change vs.
(Thousands)		1Q08			4Q07			3Q07			2Q07			1Q07				4Q07			1Q07
Servicing Income
Gross Service Fees	$	88,891		$	90,153		$	90,694		$	90,282		$	100,077
Guarantee Fees		(18,791	)		(19,775	)		(19,312	)		(18,874	)		(18,570	)
Sub-Service Fee Income		243			244			1			11			27
Lender Paid MI		(4	)		(21	)		(9	)		(20	)		(2	)
Net Service Fees		70,339			70,601			71,374			71,399			81,532				*			(14	)%
Early Payoff Interest Expense		(5,446	)		(3,626	)		(3,409	)		(5,036	)		(4,749	)
Ancillary Fees		9,214			9,192			8,696			7,509			7,951
Total Service Fees		74,107			76,167			76,661			73,872			84,734				(3	)%		(13	)%
Change in MSR Value - Runoff		(37,449	)		(40,930	)		(48,963	)		(62,661	)		(61,698	)			(9	)%		(39	)%
Net hedging results:
Change in MSR Value - Other than Runoff**		(255,485	)		(234,998	)		(102,887	)		115,739			(17,138	)
MSR Hedge (Losses)/Gains		280,935			119,651			126,742			(116,955	)		8,773
Change in Trading Asset Value**		(74,136	)		(73,496	)		(24,046	)		28,003			(3,312	)
Trading Asset Hedge (Losses)/Gains		86,322			59,022			29,343			(35,790	)		1,226
Option Expense on Servicing Hedges		(4,950	)		(23,523	)		(7,112	)		(5,704	)		(9,577	)
Total net hedging results		32,686			(153,344	)		22,040			(14,707	)		(20,028	)			(121	)%	NM
Total Servicing Income	$	69,344		$	(118,107	)	$	49,738		$	(3,496	)	$	3,008				(159	)%	NM
Key Servicing Metrics (millions)
Beginning Servicing Portfolio	$	103,709		$	108,401		$	105,652		$	102,822		$	101,370
Additions to portfolio		7,650			6,399			6,484			7,778			6,237
Prepayments		(4,144	)		(2,931	)		(2,829	)		(3,944	)		(3,645	)
Amortization		(675	)		(725	)		(707	)		(708	)		(696	)
Service Release Sales		(69	)		(166	)		(199	)		(296	)		(444	)
Bulk Sale		(7,449	)		(7,269	)		-			-			-
Ending Servicing Portfolio (Owned)	$	99,022		$	103,709		$	108,401		$	105,652		$	102,822				(5	)%		(4	)%
Avg. Servicing Portfolio (Owned)	$	103,794		$	107,259		$	107,073		$	104,208		$	101,992				(3	)%		2	%
Average Loans Serviced (#)		618,505			632,482			652,479			643,314			636,496				(2	)%		(3	)%
Portfolio Product Mix (Average)
GNMA		8	%		8	%		7	%		8	%		8	%
FNMA/FHLMC		64	%		65	%		65	%		64	%		64	%
Private		25	%		24	%		25	%		25	%		25	%
Sub-Total		97	%		97	%		97	%		97	%		97	%
Warehouse		3	%		3	%		3	%		3	%		3	%
Total		100	%		100	%		100	%		100	%		100	%
Other Portfolio Statistics
Net Service Fees - Annualized (bps)		27			26			27			27			32
Total Service Fees - Annualized (bps)		29			28			29			28			33
Ancillary Income per Loan (Annualized)	$	59.59		$	58.13		$	53.31		$	46.68		$	49.97				3	%		19	%
Servicing Cost per Loan (Annualized)	$	56.39		$	50.56		$	48.15		$	49.51		$	49.44				12	%		14	%
Average Servicing Asset (millions)***		1,019			1,353			1,465			1,371			1,505
Servicing Book Value (bps)		98			126			137			132			148
90+  Delinquency Rate, excluding foreclosures		1.73	%		1.48	%		1.18	%		.96	%		.87	%
Change in MSR Asset /
Average Servicing Asset		5	%		46	%		7	%		19	%		19	%
Run-Off Rate - Annualized		19	%		14	%		13	%		18	%		17	%
NM - Not meaningful
* Amount is less than one percent.
** 4Q07 includes a portion of the $135 million valuation adjustment
*** Includes valuation reserve/MSRs only
Certain previously reported amounts have been reclassified to agree with current presentation.

23

CORPORATE
Quarterly, Unaudited
																	1Q08 Change vs.
(Thousands)		1Q08			4Q07			3Q07			2Q07			1Q07				4Q07			1Q07
Income Statement
Net interest income/(expense)	$	3,152		$	(4,795	)	$	(1,224	)	$	454		$	2,744				(166	)%		15	%
Net interest expense from
deferred compensation		(121	)		(207	)		(202	)		(207	)		(133	)			(42	)%		(9	)%
Total net interest income/(expense)		3,031			(5,002	)		(1,426	)		247			2,611				(161	)%		16	%
Noninterest income		14			13,275			3,506			1,691			3,005			NM			NM
Noninterest income from
deferred compensation		(6,550	)		(1,667	)		526			7,603			1,265				293	%		(618	)%
Total noninterest income		(6,536	)		11,608			4,032			9,294			4,270				(156	)%		(253	)%
Securities gains/(losses), net		65,946			(10,443	)		1			(1,014	)		10,273				(731	)%		542	%
Total revenue		62,441			(3,837	)		2,607			8,527			17,154			NM				264	%
Noninterest expense		7,414			110,753			51,345			51,921			17,759				(93	)%		(58	)%
Deferred compensation expense		(8,077	)		(1,388	)		615			9,830			1,896				482	%		(526	)%
Total noninterest expense		(663	)		109,365			51,960			61,751			19,655				(101	)%		(103	)%
Provision		-			-			-			7,672			-				-			-
Pretax income/(loss)	$	63,104		$	(113,202	)	$	(49,353	)	$	(60,896	)	$	(2,501	)			(156	)%	NM
Balance Sheet
Total earning assets (millions)		3,001			2,986			3,163			3,341			3,768				1	%		(20	)%
Net interest margin		.41	%		(.66	)%		(.18	)%		.03	%		.28	%
NM - Not meaningful
* Amount is less than one percent.
Certain previously reported amounts have been reclassified to agree with current presentation.

24

CAPITAL HIGHLIGHTS
Quarterly, Unaudited
																	1Q08 Change vs.
(Dollars in millions, except per share amounts)		1Q08			4Q07			3Q07			2Q07			1Q07				4Q07		1Q07
Tier 1 Capital (a)	$	2,443.6		$	2,459.5		$	2,666.8		$	2,711.3		$	2,739.1				(1	)%	(11	)%
Tier 2 Capital (a)		1,424.7			1,400.5			1,321.4			1,316.2			1,324.0				2	%	8	%
Total Capital (a)	$	3,868.3		$	3,860.0		$	3,988.2		$	4,027.5		$	4,063.1				*		(5	)%
Risk-Adjusted Assets (a)	$	30,179.4		$	30,271.9		$	31,041.9		$	31,224.1		$	31,368.0				*		(4	)%
Tier 1 Ratio (a)		8.10	%		8.12	%		8.59	%		8.68	%		8.73	%
Tier 2 Ratio (a)		4.72			4.63			4.26			4.22			4.22
Total Capital Ratio (a)		12.82	%		12.75	%		12.85	%		12.90	%		12.95	%
Leverage Ratio (a)		6.62	%		6.64	%		7.12	%		7.00	%		7.15	%
Shareholders' Equity/Assets Ratio (b)		5.67			5.77			6.46			6.42			6.48
Tangible Equity/RWA (a)		6.08			6.16			6.75			6.86			6.91
Tangible Book Value	$	14.67		$	14.86		$	16.51		$	16.73		$	17.22
Book Value		16.59			16.83			19.08			19.43			19.88
NM - Not meaningful
* Amount is less than one percent.
(a)  Current quarter is an estimate
(b)  Calculated on period-end balances
Certain previously reported amounts have been reclassified to agree with current presentation.

25

ASSET QUALITY: CONSOLIDATED
Quarterly, Unaudited
																	1Q08 Change vs.
(Thousands)		1Q08			4Q07			3Q07			2Q07			1Q07				4Q07			1Q07
Allowance for Loan Losses Walk-Forward
Beginning Reserve	$	342,341		$	236,611		$	229,919		$	220,806		$	216,285				45	%		58	%
Provision		240,000			156,519			43,352			44,408			28,486				53	%		743	%
Divestitures/acquisitions/transfers		-			4			(5,276	)		(12,326	)		2,655			NM			NM
Charge-offs		(101,756	)		(54,891	)		(35,858	)		(26,493	)		(29,665	)			85	%		243	%
Recoveries		2,618			4,098			4,474			3,524			3,045				(36	)%		(14	)%
Ending Balance	$	483,203		$	342,341		$	236,611		$	229,919		$	220,806				41	%		119	%
Reserve for off-balance sheet commitments		11,786			10,726			9,002			10,494			9,406				10	%		25	%
Total allowance for loan losses plus reserve	$	494,989		$	353,067		$	245,613		$	240,413		$	230,212				40	%		115	%
Allowance for Loan Losses
Regional Banking	$	184,472		$	139,150		$	135,736		$	137,237		$	135,938				33	%		36	%
Capital Markets		24,338			13,522			15,072			15,738			14,369				80	%		69	%
National Specialty Lending		273,127			188,550			84,787			75,941			69,517				45	%		293	%
Mortgage Banking		1,266			1,119			1,016			1,003			982				13	%		29	%
Total allowance for loan losses	$	483,203		$	342,341		$	236,611		$	229,919		$	220,806				41	%		119	%
Non-Performing Assets
Regional Banking
Nonperforming loans	$	81,244		$	30,608		$	37,102		$	20,692		$	26,212				165	%		210	%
Foreclosed real estate		38,019			35,026			27,214			27,289			27,204				9	%		40	%
Total Regional Banking		119,263			65,634			64,316			47,981			53,416				82	%		123	%
Capital Markets
Nonperforming loans		13,030			8,970			10,051			11,921			3,598				45	%		262	%
Foreclosed real estate		600			810			810			810			810				(26	)%		(26	)%
Total Capital Markets		13,630			9,780			10,861			12,731			4,408				39	%		209	%
National Specialty Lending
Nonperforming loans		433,285			243,711			142,645			95,411			43,810				78	%		889	%
Foreclosed real estate		29,680			34,120			18,030			14,276			12,040				(13	)%		147	%
Total National Specialty Lending		462,965			277,831			160,675			109,687			55,850				67	%		729	%
Mortgage Banking
Nonperforming loans - held for sale		9,693			23,797			18,508			12,484			10,347				(59	)%		(6	)%
Foreclosed real estate		15,373			15,385			13,992			11,214			11,904				*			29	%
Total Mortgage Banking		25,066			39,182			32,500			23,698			22,251				(36	)%		13	%
Total nonperforming assets	$	620,924		$	392,427		$	268,352		$	194,097		$	135,925				58	%		357	%
Net Charge-Offs
Regional Banking	$	29,942		$	12,421		$	14,748		$	12,772		$	18,472				141	%		62	%
Capital Markets		4,215			2,794			2,684			2,304			(32	)			51	%	NM
National Specialty Lending		64,906			35,635			13,961			8,026			8,181				82	%		693	%
Mortgage Banking		75			(57	)		(9	)		(133	)		(1	)			(232	)%	NM
Total net charge-offs	$	99,138		$	50,793		$	31,384		$	22,969		$	26,620				95	%		272	%
Consolidated Key Ratios
NPL % (a)		2.41	%		1.28	%		.86	%		.57	%		.33	%
NPA % (b)		2.78			1.66			1.13			.81			.56
Net charge-offs % (c)		1.81			.93			.57			.41			.48
Allowance / Loans		2.20			1.55			1.08			1.03			.99
Allowance to loans excluding insured loans		2.26			1.62			1.12			1.07			1.03
Allowance / NPL (d)		.92	x		1.21	x		1.25	x		1.80	x		3.00	x
Allowance / NPA (e)		.79	x		.93	x		.95	x		1.27	x		1.76	x
Allowance / Charge-offs (f)		1.22	x		1.68	x		1.88	x		2.50	x		2.07	x
Other
Loans past due 90 days or more (g)	$	300,185		$	251,509		$	206,660		$	171,027		$	169,840				19	%		77	%
Guaranteed portion (g)		223,572			190,899			158,780			130,858			123,461				17	%		81	%
Foreclosed real estate from GNMA loans		22,346			18,642			15,610			13,910			16,655				20	%		34	%
Period-end loans, net of unearned income (millions)	$	21,932		$	22,104		$	21,973		$	22,382		$	22,268				(1	)%		(2	)%
Insured loans		596			913			928			987			847				(35	)%		(30	)%
Total loans excluding insured loans	$	21,336		$	21,191		$	21,045		$	21,395		$	21,421				1	%		*
Off-balance sheet commitments (millions) (h)	$	6,826		$	6,929		$	7,106		$	7,202		$	7,586				(1	)%		(10	)%

Certain previously reported amounts have been reclassified to agree with current presentation.

NM - Not meaningful

* Amount is less than one percent

(a)  Ratio is nonperforming loans in the loan portfolio to total loans

(b)  Ratio is nonperforming assets related to the loan portfolio to total loans plus foreclosed real estate and other assets

(c)  Ratio is annualized net charge-offs to average total loans

(d)  Ratio is allowance to nonperforming loans in the loan portfolio

(e)  Ratio is allowance to nonperforming assets related to the loan portfolio

(f)   Ratio is allowance to annualized net charge-offs

(g)  Includes loans held for sale.

(h) Amount of off-balance sheet commitments for which a reserve has been provided.

26

ASSET QUALITY: CONSOLIDATED
Quarterly, Unaudited
																	1Q08 Change vs.
		1Q08			4Q07			3Q07			2Q07			1Q07				4Q07		1Q07
Key Portfolio Details
Commercial (C&I & Other)
Period-end loans ($ millions)	$	7,225		$	6,969		$	7,189		$	7,162		$	7,294				4	%	(1	)%
30+ Delinq. %		.93	%		.50	%		.41	%		.66	%		.50	%
NPL %		.64			.24			.33			.31			.45
Charge-offs % (qtr. annualized)		.83			.20			.57			.45			.55
Allowance / Loans %		1.59	%
Allowance / NPL		2.51	x
Allowance / Charge-offs		2.31	x
Income CRE (Income-producing Commercial Real Estate)
Period-end loans ($ millions)	$	1,982		$	1,948		$	1,970		$	1,921		$	1,799				2	%	10	%
30+ Delinq. %		.57	%		1.96	%		.86	%		.38	%		.07	%
NPL %		2.01			.27			.06			.06			.09
Charge-offs % (qtr. annualized)		1.94			.13			.12			.04			.01
Allowance / Loans %		2.47	%
Allowance / NPL		1.23	x
Allowance / Charge-offs		1.28	x
Residential CRE (Homebuilder and Condominium Construction)
Period-end loans ($ millions)	$	1,980		$	2,093		$	2,211		$	2,271		$	2,264				(5	)%	(13	)%
30+ Delinq. %		2.73	%		3.56	%		1.25	%		1.96	%		.82	%
NPL %		12.07			6.43			3.93			1.67			.41
Charge-offs % (qtr. annualized)		5.93			3.82			.51			.29			.43
Allowance / Loans %		3.64	%
Allowance / NPL		.30	x
Allowance / Charge-offs		.58	x
Consumer Real Estate (Home Equity Installment and HELOC)
Period-end loans ($ millions)	$	7,964		$	8,182		$	7,648		$	8,064		$	8,020				(3	)%	(1	)%
30+ Delinq. %		1.55	%		1.43	%		1.25	%		1.01	%		.94	%
NPL %		.11			.09			.09			.09			.06
Charge-offs % (qtr. annualized)		.93			.62			.37			.37			.32
Allowance / Loans %		1.19	%
Allowance / NPL		10.38	x
Allowance / Charge-offs		1.28	x
OTC (Consumer Residential Construction Loans)
Period-end loans ($ millions)	$	1,815		$	2,008		$	2,160		$	2,157		$	2,073				(10	)%	(12	)%
30+ Delinq. %		2.67	%		2.50	%		1.91	%		1.08	%		1.73	%
NPL %		11.01			5.68			3.21			2.60			1.41
Charge-offs % (qtr. annualized)		4.63			2.18			1.16			.68			.14
Allowance / Loans %		6.49	%
Allowance / NPL		.59	x
Allowance / Charge-offs		1.33	x
Other Consumer, Permanent Mortgage, and Credit Card
Period-end loans ($ millions)	$	966		$	904		$	795		$	807		$	818				7	%	18	%
30+ Delinq. %		5.94	%		4.45	%		1.73	%		1.61	%		1.84	%
NPL %		1.96			.31			.21			.19			.10
Charge-offs % (qtr. annualized)		1.69			.96			.90			.93			.76
Allowance / Loans %		1.51	%
Allowance / NPL		.07	x
Allowance / Charge-offs		.89	x

27

ASSET QUALITY: REGIONAL BANKING
Quarterly, Unaudited
																	1Q08 Change vs.
		1Q08			4Q07			3Q07			2Q07			1Q07				4Q07		1Q07
Total Regional Banking
Period-end loans ($ millions)	$	10,803		$	10,631		$	11,161		$	11,085		$	10,986				2	%	(2	)%
30+ Delinq. %		1.23	%		1.16	%		.73	%		.81	%		.66	%
NPL %		.75			.29			.33			.19			.24
Charge-offs % (qtr. annualized)		1.16			.50			.51			.50			.53
Allowance / Loans %		1.71	%		1.31	%		1.22	%		1.24	%		1.24	%
Allowance / NPL		2.27	x		4.55	x		3.66	x		6.63	x		5.19	x
Allowance / Charge-offs		1.49	x		2.62	x		2.37	x		2.48	x		2.35	x
Key Portfolio Details
Commercial (C&I & Other)
Period-end loans ($ millions)	$	6,134		$	5,940		$	6,264		$	6,197		$	6,250				3	%	(2	)%
30+ Delinq. %		.98	%		.50	%		.41	%		.72	%		.51	%
NPL %		.62			.30			.28			.29			.38
Charge-offs % (qtr. annualized)		.75			.31			.67			.53			.70
Allowance / Loans %		1.59	%
Allowance / NPL		2.72	x
Allowance / Charge-offs		2.29	x
Income CRE (Income-producing Commercial Real Estate)
Period-end loans ($ millions)	$	1,365		$	1,320		$	1,350		$	1,346		$	1,227				3	%	11	%
30+ Delinq. %		.52	%		2.60	%		.91	%		.28	%		.10	%
NPL %		1.42			.04			.08			.08			.14
Charge-offs % (qtr. annualized)		2.57			.04			.07			.08			.01
Allowance / Loans %		2.35	%
Allowance / NPL		1.66	x
Allowance / Charge-offs		.93	x
Residential CRE (Homebuilder and Condominium Construction)
Period-end loans ($ millions)	$	526		$	570		$	622		$	628		$	602				(8	)%	(13	)%
30+ Delinq. %		2.61	%		2.10	%		.59	%		.40	%		.09	%
NPL %		4.68			2.14			2.98			.29			.15
Charge-offs % (qtr. annualized)		2.30			2.30			.02			.19			.01
Allowance / Loans %		3.92	%
Allowance / NPL		.84	x
Allowance / Charge-offs		1.65	x
Consumer Real Estate (Home Equity Installment and HELOC)
Period-end loans ($ millions)	$	2,486		$	2,491		$	2,616		$	2,605		$	2,602				*		(4	)%
30+ Delinq. %		1.83	%		1.70	%		1.33	%		1.32	%		1.31	%
Charge-offs % (qtr. annualized)		.76			.64			.40			.59			.41
Allowance / Loans %		.70	%
Allowance / Charge-offs		.92	x
Other Consumer and Credit Card
Period-end loans ($ millions)	$	293		$	310		$	309		$	309		$	305				(5	)%	(4	)%
30+ Delinq. %		1.89	%		1.77	%		1.82	%		1.63	%		1.67	%
Charge-offs % (qtr. annualized)		4.69			1.71			1.53			1.74			1.31
Allowance / Loans %		4.43	%
Allowance / Charge-offs		.95	x

* Amount is less than one percent

28

ASSET QUALITY: NATIONAL SPECIALTY LENDING
Quarterly, Unaudited
																1Q08 Change vs.
		1Q08			4Q07			3Q07			2Q07			1Q07			4Q07		1Q07
Total National Specialty Lending
Period-end loans ($ millions)	$	9,114		$	9,554		$	9,079		$	9,509		$	9,391			(5	)%	(3	)%
30+ Delinq. %		1.85	%		2.02	%		1.38	%		1.21	%		1.03	%
NPL %		4.75			2.55			1.57			1.00			.47
Charge-offs % (qtr. annualized)		2.80			1.50			.61			.35			.36
Allowance / Loans %		3.00	%		1.97	%		.93	%		.80	%		.74	%
Allowance / NPL		.63	x		.77	x		.59	x		.80	x		1.59	x
Allowance / Charge-offs		1.07	x		1.32	x		1.53	x		2.28	x		2.05	x
Key Portfolio Details
Income CRE (Income-producing Commercial Real Estate)
Period-end loans ($ millions)	$	428		$	393		$	376		$	349		$	334			9	%	28	%
30+ Delinq. %		.55	%		.76	%		1.37	%		.42	%		.03	%
NPL %		4.65			1.18			-			-			-
Charge-offs % (qtr. annualized)		.87			-			.49			-			-
Allowance / Loans %		3.07	%
Allowance / NPL		.66	x
Allowance / Charge-offs		3.67	x
Residential CRE (Homebuilder and Condominium Construction)
Period-end loans ($ millions)	$	1,363		$	1,431		$	1,479		$	1,512		$	1,535			(5	)%	(11	)%
30+ Delinq. %		2.78	%		4.28	%		1.13	%		2.76	%		1.17	%
NPL %		15.36			7.80			4.18			2.00			.44
Charge-offs % (qtr. annualized)		7.45			4.01			.63			.16			.50
Allowance / Loans %		3.53	%
Allowance / NPL		.23	x
Allowance / Charge-offs		.46	x
Consumer Real Estate (Home Equity Installment and HELOC)
Period-end loans ($ millions)	$	5,478		$	5,691		$	5,032		$	5,459		$	5,418			(4	)%	1	%
30+ Delinq. %		1.44	%		1.33	%		1.14	%		.89	%		.79	%
NPL %		.12			.09			.09			.10			.07
Charge-offs % (qtr. annualized)		1.02			.62			.34			.28			.30
Allowance / Loans %		1.43	%
Allowance / NPL		2.74	x
Allowance / Charge-offs		1.41	x
OTC (Consumer Residential Construction Loans)
Period-end loans ($ millions)	$	1,815		$	2,008		$	2,160		$	2,157		$	2,073			(10	)%	(12	)%
30+ Delinq. %		2.67	%		2.50	%		1.91	%		1.08	%		1.73	%
NPL %		11.01			5.68			3.21			2.60			1.41
Charge-offs % (qtr. annualized)		4.63			2.18			1.16			.68			.14
Allowance / Loans %		6.49	%
Allowance / NPL		.59	x
Allowance / Charge-offs		1.33	x
Other Consumer
Period-end loans ($ millions)	$	29		$	32		$	32		$	30		$	30			(9	)%	(3	)%
30+ Delinq. %		6.90	%		6.00	%		5.56	%		4.89	%		4.79	%
Charge-offs % (qtr. annualized)		9.13			9.61			6.91			6.20			6.80
Allowance / Loans %		.33	%
Allowance / Charge-offs		.60	x

29

ASSET QUALITY: MORTGAGE BANKING & CAPITAL MARKETS
Quarterly, Unaudited
																1Q08 Change vs.
		1Q08			4Q07			3Q07			2Q07			1Q07			4Q07		1Q07
Total Mortgage Banking
Period-end loans ($ millions)	$	647		$	562		$	459		$	475		$	490			15	%	32	%
30+ Delinq. %		7.73	%		5.59	%		1.29	%		1.29	%		1.65	%
Allowance / Loans %		.20	%		.20	%		.22	%		.21	%		.20	%
Total Capital Markets
Period-end loans ($ millions)	$	1,368		$	1,356		$	1,274		$	1,315		$	1,402			1	%	(2	)%
30+ Delinq. %		.82	%		.99	%		.56	%		.38	%		.31	%
NPL %		.95			.66			.79			.91			.26
Charge-offs % (qtr. annualized)		1.23			.86			.85			.49			.01
Allowance / Loans %		1.78	%		1.00	%		1.18	%		1.20	%		1.02	%
Allowance / NPL		1.87	x		1.51	x		1.50	x		1.32	x		3.99	x
Allowance / Charge-offs		1.44	x		1.15	x		1.40	x		2.43	x		79.83	x

30

ASSET QUALITY HIGHLIGHTS: KEY PORTFOLIOS
Unaudited
C&I Portfolio: $7.2 Billion (33% of Total Loans)
	- Impacted by deterioration in economic conditions and impacts of housing market
	- Diverse and granular portfolio
	- Mostly relationship customers in TN and regional middle market lending efforts
Consumer Real Estate (primarily Home Equity) Portfolio: $8.0 Billion (36% of Total Loans)
	- Performance shows deterioration in Q1 primarily related to higher risk markets	Top 10 States
	- Geographically diverse		% OS	Del. %	C/O %
	- Top States (TN= 29%, CA = 14%, WA = 4%, MD = 4%, VA = 3%, FL = 3%)	TN	29%	1.60%	.34%
	- Strong borrower quality	CA	14%	1.15%	1.16%
	- 752 avg. origination FICO; 729 avg. portfolio FICO (refreshed)	WA	4%	.56%	.43%
	- Good collateral position	MD	4%	1.34%	.46%
	- High LTV loans managed through whole loan insurance	VA	3%	2.05%	4.24%
	-26% 1st lien and 74% second lien	FL	3%	2.68%	2.94%
	- 86% of uninsured portfolio <90 CLTV	GA	3%	1.85%	1.55%
	- 14% of uninsured portfolio is HLTV, 62% of which (or 8.7%) have FICO >700	AZ	3%	1.82%	1.27%
	- No longer originating loans >89.9% CLTV	PA	2%	1.64%	.60%
	- Good borrower capacity (33% avg. DTI)	NJ	2%	1.65%	.06%
	- Primarily retail-sourced (85% retail)
	- Mix of older vintage loans	As  0f  03/31/08
	- 57% originated prior to 2006
		FICO (Orig.)
			% OS	Del. %	C/O %
		760+	33%	.38%	.32%
		700-759	43%	1.26%	.95%
		660-699	17%	2.55%	1.38%
		620-659	6%	4.83%	2.61%
		<620	2%	6.98%	2.41%
		As  0f  03/31/08
		CLTV (Orig.)
			% OS	Del. %	C/O %
		>90%	22%	2.44%	1.84%
		80.1%-90.0%	26%	1.79%	1.33%
		<=80%	53%	1.08%	.37%
		As  0f  03/31/08
	As of   Mar. 31,  2008
Homebuilder Portfolio: $2.0 Billion (9% of Total Loans)		Top 10 States
			% OS	% NPL
	- Loans to residential builders and developers	TN	18%	3%
	- Performance under pressure from housing market (oversupply & lack of mortgage availability)	FL	12%	29%
	- Most severe market conditions in Florida, California, Virginia/DC, Nevada, Arizona, and Georgia/Atlanta	WA	10%	4%
	- Condominium construction balances small ($241 million) but individual commitments tend to be larger	CA	9%	17%
	- Managing existing relationships (shrinking business into 2008)	TX	6%	6%
	- Devoting additional resources to manage problem loans	NC	5%	2%
	- Ceased originations for national CRE business in January: wind-down portfolio	VA	5%	23%
		MD	4%	-
		CO	4%	11%
		GA	3%	12%
		As  0f  03/31/08
One-Time Close (OTC) Portfolio: $1.8 Billion (8% of Total Loans)		Top 10 States
			% OS	% NPL
	- Construction-to-perm loans with short duration	CA	22%	27%
	- Performance under pressure from housing market, borrower stress	TX	14%	6%
	and lack of product salability in the secondary market	UT	9%	6%
	- Actively identifying and remediating problem accounts with a variety of strategies	ID	7%	13%
	- Devoting additional resources to manage problem loans	WA	7%	2%
	- Ceased originations for national OTC lending: wind-down portfolio	AZ	5%	5%
		FL	5%	22%
		OR	4%	2%
		VA	2%	3%
		MD	2%	-
		As  0f  03/31/08
Income CRE Portfolio: $2.0 Billion (9% of Total Loans)		Top 10 States
			% OS	% NPL
	- Traditional commercial real estate construction and mini-permanent loans	TN	39%	1%
	- Two-thirds managed by Regional Banking segment	NC	10%	-
	- One-third in national CRE business: wind-down portfolio	FL	9%	11%
	- Performance showing some impact from housing market	MS	4%	1%
		TX	3%	-
		AZ	3%	-
		CA	2%	18%
		OR	1%	7%
		As  0f  03/31/08

31

ASSET QUALITY: PROCESS HIGHLIGHTS
Product	Current Process	1Q08 Actions
Commercial Loans (Real Estate / C&I)
	Risk Grading
	Reserves are established using historical loss factors by grade level. Relationship managers risk rate each loan using grades that reflects both the probability of default and estimated loss in the event of default.  Loans with emerging weaknesses receive increased oversight through our Watch List process.	RMs received additional training and tools to promptly identify weakening credits.  Required RMs to review all the assigned grades for all C&I and CRE loans.
	Portfolio Reviews conducted quarterly by senior credit officers to provide independent oversight of risk grading decisions for larger credits.	Portfolio Review process enhanced and repeated for CRE and expanded to cover C&I portfolio related to the housing industry.
	Watch List Process
	For new Watch List loans, senior credit management reviews risk grade appropriateness and action plans.  After initial identification, RMs prepare monthly Watch List updates for review and discussion by more senior Line and Credit officers.  This oversight brings consistent grading and allows timely identification of loans that need to be further downgraded or placed on non-accrual.
	Classified & Non-Accruals
	When a loan becomes Classified, the asset generally transfers to the specialists in our Loan Rehab and Recovery group. Accounts receive expert workout attention; new appraisals are generally ordered.
	Loans 90 days or more past due, or when we probably will not collect all principal and interest, are placed on non-accrual.
	Impairment Assessment
	All classified non-accrual loans over $1 million are assessed for impairment in accordance with FAS-114.  Although we occasionally use the Discounted Cash Flow approach, most non-accrual assets are viewed as collateral dependent and assessed using a Fair Value of Collateral approach.	Increased number of loans viewed as Collateral Dependent.
	Fair Value estimates start with appraised values, normally from a recently received and reviewed appraisal. Appraised values are adjusted down for costs associated with asset disposal and for our estimate of any further deterioration in values since the most recent appraisal.
	Upon non-accrual, we charge off the full difference between book value and our most likely estimate of the asset’s net realizable value. Possible guarantor support is not factored into the impairment estimates for collateral dependent loans.
One-Time Close (OTC) Loans
	Monthly portfolio reviews conducted with line managers and credit officers.  We examine the inherent risk in credits based on factors such as draw inactivity and borrower conditions, often recognizing problems prior to delinquency.  In addition, all OTC loans that reach 90 days delinquent are placed on non-accrual.	Significantly increased reliance on behavioral factors (vs. primarily delinquency status) to identify potential problem accounts. Improved NPA recognition and sped attendant  remediation efforts.
	A new appraisal is ordered for loans that reach 90 days past due or are classified as substandard during the monthly portfolio review.  Loans are initially written down to current appraised value.  Loans are then charged down to 85% of appraised value when they reach 180 days past due, and to 78% of value when they are taken into OREO.
	Reserve levels established based on a combination of loans grading and portfolio modeling.	Reserve levels adjusted to reflect portfolio deterioration.
Home Equity Loans & Lines
	Loans are classified Substandard at 90 days delinquent. At 180 days delinquent, we assess our collateral position. If value does not support foreclosure, balances are charged off and other avenues of recovery are pursued. If value supports foreclosure, the loan is charged down to realizable value and is placed on non-accrual. When collateral is taken to OREO, the loan is further written down to between 60% and 85% of appraised value depending on the loan amount.
	Reserve levels set through the use of several models that look at historical losses, cumulative vintage performance, and  roll rates.	Additional modeling developed. Reserve levels adjusted to reflect portfolio deterioration.

32

GLOSSARY OF TERMS
Appraisal Fees:  A fee charged to the borrower for the cost of appraising a property.
Concessions:  The net amount of the discount or premium pricing charged to borrowers upon loan origination.  This also includes the servicing release premium paid to correspondents to purchase loans.  Discount pricing is used to competitively price mortgage loans.
Credit Report Fee:  A fee charged to the borrower for the cost of obtaining the borrower’s credit report.
FAS 91 Fee Deferral:  The timing difference between collecting and recognizing origination fees on a loan not carried at elected fair value.  For loans held for sale not carried at elected fair value, origination fees are recognized at the time the loan is sold, not at the time the loan is originated.
FAS 91 Reclassification:  The reclassification of the cost of originating mortgage warehouse loans, not carried at elected fair value, sold during the period.
Final Inspection Fee: A fee charged to the borrower to inspect a property.
Lower of Cost or Market (LOCOM):  A method of accounting for certain assets by recording them at the lower of their historical cost or their current market value.
Marketing G/L (Trading Gains):  The net result of hedging activities.
Originated Mortgage Servicing Rights (OMSR):  The retained right to service a mortgage loan when a mortgage loan is sold on a servicing-retained basis. Represents the present value of the amount by which the estimated future net cash flows from servicing mortgage loans exceeds the cost of servicing mortgage loans.
Origination Fees:  A fee charged to the borrower by the lender to originate a loan.  Usually stated as a percentage of the face value of the loan.
Servicing Released Premium (SRP):  The premium received for selling loans on a servicing released basis.
Tangible Equity/RWA: Shareholders' equity excluding intangible assets and unrealized gains/losses on available for sale securities and cash flow hedges divided by risk weighted assets.

33